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Top lawyer calls on government to resurrect Metal Theft Bill to combat rising claims

21 May 2012

Browne Jacobson is appealing to the Government to resurrect its lost Metal Theft (Prevention) Bill and tackle the scrap dealers head-on following news that a plaque commemorating the deaths of children has been stolen in Warrington.

The scrap metal trade is worth almost £6 billion a year and £1billion of that is illegal trade with an estimated 60 per cent of the stolen metal ending up abroad.

Nichola Evans, Partner from law firm Browne Jacobson, explained: "The industry is acting under laws that are past their sell by date and it is vital the Government takes action now by resurrecting the proposed Bill to prohibit cash payments for scrap metals, increase police powers and permit unlimited fines for all relevant offences."

Metal theft cost the Church of England £10 million last year, as the number of incidents more than trebled in certain areas. The ongoing epidemic saw the value of church insurance claims rise from £173,000 in 2009 to almost £4.5 million across England in 2011.

More than 2,500 claims were made last year alone and the church was forced to bear the brunt of the costs as thieves exploited soaring metal prices by targeting lead and copper roof coverings and pipes.

Nichola Evans said the number of thefts was actually likely to be much higher as she predicts that less than half of the cost of metal theft was claimed, often due to the fact that excesses maybe higher than the claim itself.

She explained: "The claims do not just cover the cost of replacing the item, which can be high especially for listed buildings, but if copper water pipes are stolen there can often be a building insurance claim for water damage which can be far higher than the theft of the metal itself."

Some UK insurers have reacted by capping the value of total claims that are paid out in a single year. Policyholders are also seeing an increase in the levels of excess per insurance policy.

The insurance industry has also called on Local Authorities to allow different, less thief-attracting, building materials to replace metal in order to reduce the increasing number of repeat crimes, but this is falling on deaf ears particularly in the case of listed buildings.

Nichola concludes: "The solutions are simple; the UK public, the victims of metal theft and the insurers must appeal to the UK Government to resurrect the vital legislation needed to combat this crime. If the price of precious metals continues to rise, we will see more thefts, more claims, fewer insurer policies on the market and increasing excess levels or premiums.

"The current antiquated legislation allows hundreds of thousands of pounds to be exchanged in carrier bags, the police do not have enough power to close scrap yards down and fines often amount to an average of £350."

"Tougher legislation along with technology is the answer. The Government must introduce a cashless system, unlimited fines and photographic identification and licensing for traders akin to that of asbestos disposal. In addition scrap metal yards should install CCTV and number plate recognition. The Government also needs to tackle illegal exports of metal.

"Coupled with this, building owners should consider replacing lead with fibreglass or other cheaper materials where permitted. Installing motion sensors, alarms and CCTV can also help to reduce premiums. I would also advise the general public to remain vigilant and report any suspected metal theft immediately."

With metal theft costing the UK economy approximately £770 million per year*, in January 2012, the Home Secretary Theresa May announced that the Government would be legislating to prohibit cash payments to purchase scrap metal and to significantly increase the fines for all relevant offences under the existing Scrap Metal Dealers Act 1964. These changes will be introduced by way of Government amendments to the Legal Aid, Sentencing and Punishment of Offenders Bill.

However, this Bill was subsequently rejected at its second reading with a split in the Government between those who want action and those who believe the legislation will create damaging red tape.

Greater Manchester Police are leading the way in combatting metal theft. Operation Alloy partners the policy with scrap metal dealers, utility and transport authorities in order to bring criminals to justice and has reduced metal theft across the region by a third since its inception in 2011.

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Lakhbir Rakar

Lakhbir Rakar

PR Manager