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Metal Thefts (Electricity Industry)

– in the House of Commons at 10:01 pm on 6th September 2011.

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Motion made, and Question proposed, That this House do now adjourn.—(Mr Newmark.)

Photo of Graham Jones Graham Jones Opposition Assistant Whip (Commons) 10:16 pm, 6th September 2011

I start by declaring an interest, as my partner and my son are employees of Electricity North West and it is her and her colleagues’ constant concerns that have drawn my attention to this very serious matter.

The increase in metal theft in the UK and elsewhere in the past few years has been alarming. Electricity North West has seen a 40-fold increase in thefts over the past 10 years and there is a growing body of opinion that those involved in organised crime, buttered by the benefits of high scrap prices for copper, aluminium and brass, have a free hand without disruption to steal, sell and profit.

The shocking figures speak for themselves. In 2009 there were about 100 reported metal thefts per month according to the Energy Networks Association, which represents the electricity and gas network and utility companies. Two years later, in 2011, that figure has risen to 700 thefts per month, and in one calendar month—March this year—it rose to a record 900 reported thefts. We can contrast that with March 2009, when there were around 70 thefts. That is an increase of more than 1000% in two years.

The Association of Chief Police Officers put the annual cost of metal theft to the communications, energy, transport and water industries at £770 million per annum. It is not just electricity that is being targeted, however. The Energy Networks Association and Electricity North West both believe organised crime is involved and thieves are stealing from telecommunications, gas and water infrastructure, rail and tramways, local authority street furniture, such as manhole covers and gates, housing, schools and other buildings. BT reported in October last year that it had had 900 cable theft attacks on its network in the previous six months, affecting more than 100,000 customers. Virgin Media says that the cutting of cables in Teesside alone has cost £166,000 and 1,700 stolen back-up batteries have cost the company a further £680,000. The British Transport Police estimate that over the last three years cable theft has cost the rail industry £43 million and led to more than 16,000 hours of delays. There is evidence that the theft of gates from railway stations is leaving rail networks dangerously exposed. Metal thefts affecting the supply of gas equipment have resulted in fires and explosions.

There is a human consequence to all these thefts. I visited Electricity North West and was told by staff that there is daily worry about people’s safety as a result of metal theft. Innocent children gain access to unsecure substations. Customers receive dangerous high voltages. There is danger to those illegally entering substations and a danger to staff undertaking routine maintenance.

Just over two months ago a 16-year-old boy died in an electricity substation. This happened in the course of an alleged theft of copper cable. According to the Energy Networks Association, there have been four such deaths so far and at least 50 injured. In June this year, many saw the BBC TV news item of a Leeds man with electricity cable burns from a 21,000 V strike from a live power line—burns so bad his own daughter did not recognise him in hospital. The impact blew part of his skull off, leaving his brain exposed. Leeds magistrates gave him a 12-month community service order for burglary.

The reality is that on a daily basis thefts are taking place against our national energy infrastructure across the UK. These are malicious and leave sites unsafe as well as causing disruption to the public and the economy. These thefts have led to 750 cases of loss of supply to at least 25,000-plus homes. Of these there were over 2,500 cases involving damage to customer’s TVs, computers and boilers as a result of the outages. In addition there have been 23 environmental incidents and at least 60 fires. A recent theft in Yorkshire cost local residents and insurers over £500,000 in broken electrical equipment and boilers as a result of a theft of just £40 of copper when customers’ voltage rose from 240 V to a dangerous 430 V.

In Castleford two houses blew up after the neutral wire was removed, resulting in a 430 V current in a cooker burning through a gas pipe. Caught on video, it is lucky no one was home. Until this year, thefts had been mainly from substations, but Electricity North West, like elsewhere, has seen an increase in thefts of overhead line wires from the top of 30 metre pylons carrying 132,000 V. In one incident in Chadderton recently a business owner noticed that a power line had collapsed on to his roof when he arrived for work. The thieves had climbed up an electricity pylon and cut the wire. The thieves did this at two further pylons, managing to steal two 400-yard lengths of copper cable. The nearby Crown Business Centre at Failsworth has been hit five times by copper thieves this year, frequently leaving their telephone lines down. Nothing is stopping the thieves. Only days after the Chadderton theft, thieves struck in Middleton where National Grid discovered that another piece of copper cabling running between two tall pylons had been cut down.

In Accrington this week, thieves have even taken to stealing the brass locks from numerous substations leaving them accessible to inquisitive young children. Earlier this year, the theft of a £5 brass valve from an oil-filled transformer resulted in 30,000 litres of oil leaking out. Luckily, this was contained within the site, but if it had not been, it might easily have caused road accidents or damaged the local environment.

Every day ENW suffers theft. Some substations are robbed repeatedly, where even electrified fencing has failed to keep the thieves out. Only last month and for the first time, National Grid suffered the theft of the earth wire from one of the larger pylons carrying a 275,000 V power line. The anti-climbing guard was cut and the pylon was climbed in broad daylight. The earth wire was cut, fell to ground and was then cut up. That all requires specialist knowledge and cutting gear.

The earth wire could easily have fallen on to the live wires below, which could have disrupted the supply of electricity to in excess of 100,000 people. Had it been one of the largest pylons carrying 400,000 V, then this figure would have disrupted electricity supply to some 500,000 people.

Frankly, the police and the Home Office have not taken the issue seriously enough. The paltry amount of Government focus on metal theft and a lack of consistent police action across the country have quietly allowed serious organised criminal groups to muscle in on an increasingly lucrative trade. We are talking about the organised thieves with protected rounds who cruise my back alley each week—and other back alleys in Haslingden and Hyndburn—and expert criminals with know-how. The Government must take the issue seriously; I ask the Minister to consider it at the Energy Emergencies Executive Committee.

In March, two men were sentenced to 20 months for the theft of metal from two substations in Kent. The theft caused £125,000-worth of damage for copper that was estimated at less than £100 in value. The reality is that apprehension for metal theft is rare. If the thief is caught, the offence is punishable only under the Theft Act 1968. While most thefts do thousands of pounds-worth of damage, the law only considers the scrap value, which is a few pounds, and the result is usually just a community sentence, which is completely disproportionate to the consequences of the crime. Metal theft from Electricity North West’s network costs customers approximately £2 million a year.

The electricity and gas industry network companies can only do so much to address the problem. Safety remains their paramount concern. They are making infrastructure as secure as possible, but there are hundreds of thousands of individual sites. In the UK, companies and industries have attempted to deal with the issue by deploying various types of defence, including closed circuit television, forensic marking systems, improved building security, locking and fencing, including electrified fencing, which is used in my area.

Even close collaboration with the police, of the kind that takes place in Greater Manchester, has not stemmed the increase in theft. It appears simply to move the crime to another area, company or private property. It has proved almost impossible to prevent metal theft in a cost-effective way. No industry affected by such crimes has found an effective and enforceable system to deal with the receivers of the metals or deter the perpetrators. With copper prices at £6,000 per tonne, and sky-high aluminium prices, Electricity North West believes that the majority of the metal stolen from its network is either stolen to order and sold through poorly regulated scrap dealers, or bulked at a predetermined location and exported to overseas foundries.

At a recent visit to a reputable wholesale scrap metal dealer, Electricity North West found on site some of its equipment, which had been stolen and had entered the cash-only, no-questions-asked system. The UK is at risk from theft tourism, as our European counterparts are implementing robust regulatory systems governing how metals may be bought and traded. That means that organised crime may choose the UK as a soft option for metal theft. France and Belgium are implementing a process of cashless transactions for scrap metal, and other countries are beginning to address the problem. It is clear that current legislation is not fit for purpose. Even allowing for the redoubling of efforts by companies, metal theft continues to rise at an alarming rate.

There is overwhelming evidence that the Government need to focus on the supply chain, and to reclassify criminal deterrents so that the sentence fits the crime. There must be a focus on the people to whom the thieves sell their stolen metal; they are not always scrap metal dealers. As Electricity North West found out, we may be talking about a container collection point beside the motorway, for movement out of Hull sea port. It is therefore imperative that we close down all means of disposal of stolen metal, and do not just target scrap metal dealers.

So far, the Government have stood idly by, relying on legislation from the age of “Steptoe and Son”. They seem incapable of taking, or unwilling to take, reasonable steps to stamp out criminality and organised crime, despite the warm words of Baroness Browning. The Scrap Metal Dealers Act is from 1964. It imposes no obligation on scrap metal dealers to comply with the law; in fact, it does the opposite. Those who register under the Act can be visited by the police, while those who do not need only be visited if there is a reasonable suspicion that they have stolen metal on their site. That is ridiculous.

I call on the Government to consider making the following changes. They should amend the Scrap Metal Dealers Act 1964. Instead of the current registration scheme, the UK needs a robust licensing regime, with scrap metal dealers paying a licence fee to fund the regulation of the licence. Property obtained through theft should be regarded as criminal assets; that would allow the provisions in the Proceeds of Crime Act 2002 to apply. In line with alcohol licensing powers, police authorities should have the power to search and investigate all premises owned and operated by a scrap metal dealer, and to close scrap metal dealers where criminally obtained materials are discovered. We should restrict trade in scrap metals to cashless payments, and introduce a requirement that scrap metal must not be sold or processed until payments have been cleared. Photo identification and CCTV should be used to identify sellers of scrap and their vehicles. Magistrates should have powers to add licence restrictions and prevent closed yards from re-opening, and criminal gangs should be charged in a way that is proportionate to the consequences of the crime, not the scrap metal value. I ask the Minister to use all his efforts to ensure that something is done before it is too late.

Photo of Charles Hendry Charles Hendry The Minister of State, Department of Energy and Climate Change 10:29 pm, 6th September 2011

I congratulate Graham Jones on securing the debate and thank him for the well researched, thoughtful and constructive way in which he addressed the subject. He has undoubtedly highlighted an issue that is growing in occurrence and severity, and he is right to say that more needs to be done. I hope to set out how we intend to go about dealing with it. I am grateful to the hon. Gentleman for raising the matter today.

In my response I shall focus on three things—the risks posed by metal theft to the electricity industry, what we are currently doing to tackle metal theft in the electricity industry, and how the Government propose to tackle the problem in the future. Let me be clear that the Government fully recognise the serious consequences of metal theft. This is not a victimless crime, as the hon. Gentleman made clear. As he said, a young teenager was recently killed attempting to steal copper cable from a substation in Leeds. That is a terrible thing for all concerned to deal with, and unfortunately was just one of several fatalities that occurred over the past year, along with countless injuries to the thieves themselves and the risk to engineers who are called out in the middle of night to make safe equipment that has been damaged.

It is not only those lives that are put at risk, but those of innocent householders whose appliances can be damaged or catch fire because of a metal theft in their area. The lives of our emergency services attending fires caused by metal theft are also at risk. I, too, was shocked to see the recent footage of a gas explosion at a house fire in Castleford on 8 July. It appeared to me that it was only by pure luck that the firefighters in attendance avoided death or at least serious injury.

Lives lost are not the only consequence of metal theft, as the hon. Gentleman pointed out. Across the energy sector, the main risks are disruption to electricity supplies affecting businesses, households and communities; risks to public safety, including through the loss of communications—999 calls, for example, loss of street lighting, traffic lights and safety-related equipment; and financial losses to businesses. Metal theft does not affect only the energy sector. For example, only this morning thousands of commuters from the south-east, including many from my constituency, were subjected to severe disruption when metal thieves stole 50 metres of signalling cable in the London Bridge area.

I understand that Network Rail has provisionally estimated that the cost of this incident is likely to run well into hundreds of thousands of pounds. Sadly, such thefts cause misery for thousands of commuters, cause damage to the economy and are out of all proportion to the value of the cable stolen. This evening I spoke to the Under-Secretary of State for Transport, my hon. Friend Norman Baker, about that mindless, irresponsible and utterly foolish attack on the rail network. We are like-minded in our resolve to take action to tackle the problem, and a meeting has already been convened for Ministers across Departments next week to discuss the issue and all its ramifications.

The hon. Gentleman mentioned an incident that occurred in July 2009 in the area around Dartford in Kent, where up to 100,000 properties were left without power as a result of a suspected attempt to steal metal from four 132 kV copper cables. The extent of the damage meant that it took EDF four days to restore supplies fully, causing widespread disruption to homes and local businesses. Ironically, though this incident cost hundreds of thousands of pounds in damage, compensation and goodwill payments, it is thought that no metal was actually stolen.

Owing at least in part to increasing commodity prices, the electricity industry continues to see an increase in the number of incidents of metal thefts experienced across its networks. Figures supplied by the Energy Networks Association, which hosts the security incident reporting system, show that the average number of incidents per month for 2010 was 440. By July this year, after only seven months of data, the electricity industry is experiencing on average 627 attacks every month.

The exact cost to the United Kingdom of metal theft is difficult to ascertain. There is significant under-reporting of incidents and it is not possible to identify and record every cost associated with an incident. In 2010-11, between 80,000 and 100,000 metal theft-related offences were recorded by police. Last year, the Association of Chief Police Officers estimated that the cost of metal theft to the United Kingdom was £777 million a year. The victims cover all sectors of the community, from power and communication supplies and the rail network to local communities, with church roofs and street furniture being stolen.

As we know, and as the hon. Gentleman rightly pointed out, metal theft is driven by a range of factors. Metal is a sought-after commodity, with prices increasing steadily. Current prices on the global exchanges put the value of copper at between £5,500 and £6,000 a tonne. The expectation is that commodity prices will continue to rise in coming years, so we can assume that the incidence of metal theft will continue to rise unless action is taken, which is what we are determined to do.

We take the issue very seriously. Through the security task force of the Energy Emergencies Executive, the Department of Energy and Climate Change and the electricity network operators meet regularly to discuss a range of security issues, and metal theft is a standing item on the agenda. The chair of the task force also represents the electricity sector at the Association of Chief Police Officers’ metal theft working group. Working with the Home Office, we have secured the inclusion of metal theft in its recently published organised crime strategy “Local to Global: reducing the risk from organised crime”, which shows that we share the hon. Gentleman’s view that organised crime is involved in this activity.

The inclusion of metal theft in the organised crime strategy will help to raise the profile of this increasing problem across several critical national infrastructure sectors, including energy, and increase the priority it is given by relevant enforcement agencies. The multi-agency ACPO metal theft working group, which is chaired by British Transport police, has developed a new strategy to tackle metal theft. The working group comprises members from across law enforcement, the utilities sector and Government Departments.

The new strategy covers four objectives: increasing the effort required to steal metal; increasing the risk to offenders; reducing the ease and rewards for offenders selling stolen metal; and increasing the risk for scrap metal dealers of handling stolen material. Progress is being made on a number of actions from this strategy, ranging from developing metal alternatives and considering how to make metals more difficult to steal, which is very much a longer-term action, to developing a more co-ordinated law enforcement approach and intelligence sharing across the utilities sector and police forces on a regional basis.

Although individual progress is being made by police forces and the electricity industry to tackle metal theft, we are conscious that more effort is required if we are to address this problem seriously across all critical national infrastructure sectors. The Government are looking at what more can be done. Discussions, led by the Home Office as the lead Department for crime prevention, are under way with a number of Departments, including DECC, to identify further options for tackling metal theft.

At the recent parliamentary event to which the hon. Gentleman referred, hosted by the Energy Networks Association, my noble Friend Baroness Browning set out the Home Office’s proposals for taking this work forward. This focused on a number of key areas. First, it focused on exploring the feasibility of introducing tighter regulations on the scrap metal industry in order to tackle the ready market for stolen metals. This includes, as he has asked, looking at modernising the Scrap Metal Dealers Act 1964, which does not reflect the current £5.6 billion scrap metal recycling industry. It will also include looking at amending and improving the existing scrap metal dealer registration regime.

Photo of Graham Jones Graham Jones Opposition Assistant Whip (Commons)

I appreciate the Minister giving way on this point and the fact that he is looking at amending the legislation. Could he indicate when he thinks legislation might be brought in to have an impact on scrap metal dealers, or give a time frame?

Photo of Charles Hendry Charles Hendry The Minister of State, Department of Energy and Climate Change

The first priority, as I am sure the hon. Gentleman understands, is to decide what are the best courses of action and determine what needs primary legislation and what can be done through secondary legislation. We are at the stage before that, but I hope that I am showing him that, with the new Minister, Baroness Browning, coming in, a great sense of urgency is being given to the sort of solution he has been highlighting.

Baroness Browning also spoke about closer links to environmental legislation and the licensing requirements for waste management and the need for more stringent identification requirements when selling metal, to identify both the seller and the owner of the material. The current regime requires little more than any name written down on the dealer’s records. The power to close scrap metal yards where there is clear evidence of sustained illegal activity is being considered, as is the possibility of moving away from cash as a method of payment for this industry, thereby removing the perceived easy access to cash. We are absolutely looking at the issue the hon. Gentleman has highlighted. If there are any other issues on the list he set out, I will ensure that they are on the agenda for the meeting so that we look at the full range of possible options.

Photo of Jim Shannon Jim Shannon Shadow DUP Spokesperson (Health), Shadow DUP Spokesperson (Transport)

There seems to be an insatiable demand for scrap metal in other parts of the world. Like many others in the Chamber, I suspect that the metals are ending up in the far east. Does the Minister intend to have more stringent export controls?

Photo of Charles Hendry Charles Hendry The Minister of State, Department of Energy and Climate Change

Part of the purpose of looking at the issue as an organised crime activity is that it gives us a much greater ability to look at it internationally. The hon. Member for Hyndburn highlighted how action is being taken in other European countries, and there is certainly a need for an international co-ordination of approaches—better understanding and better information sharing—so that when things are happening through an international chain, we can pursue them and make sure that the relevant people are brought to justice in the most appropriate regime.

The Government have no desire to target or hinder the perfectly legitimate and valuable green economy work undertaken by the vast majority of law-abiding scrap metal dealers. However, elements of the industry are facilitating the theft of metals, and steps must be taken to shut such disposal routes.

I thank the hon. Member for Hyndburn for securing this important debate. I assure him and the House that the Government take the issue very seriously. We will be having the meeting next week, on a cross-departmental basis, and the issues that he has highlighted will be addressed then. As I have explained, we are determined to address the issue, which is causing massive inconvenience, great threats and a really serious challenge to people working in the industry.

Question put and agreed to.

House adjourned.