Second-Hand Goods Act amendment will bring ‘hardship for waste pickers’ – SEIFSA

The government has published an invitation for public comments on the proposed amendments to the Second-Hand Goods Act.

However, the Steel and Engineering Industries Federation of Southern Africa (SEIFSA) has since criticised the proposed amendments.

Elias Monage, the federation’s president says the amendments result in “hardship for the waste pickers”. The federation also believes the amendments will not achieve the desired effect.

Second-Hand Goods Act

According to the South African Government website, the act aims to “regulate the business of dealers in second-hand goods and pawnbrokers, in order to combat trade in stolen goods; to promote ethical standards in the second-hand goods trade; and to provide for matters connected therewith”.

If successful, waste metal sellers will need to be registered in order to sell metal. However, According to the amendment, Only businesses that have a satisfactory Tax Compliance Status will be eligible to register as scrap and waste metal buyers and sellers.

The amendment aims to curb the vandalism of public infrastructure for metal. It aims to ban buyers from paying cash to sellers for metal.

“The proposed amendments envisage an enhanced reporting system which will require the submission of monthly electronic reports via the Metal Trading System (MTS) showing all purchases and sales of metal products,” says Monage.

Monage says the submission of the granular detail envisaged under the MTS cannot be accepted by the industry in its current form. 

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SEIFSA concerned about the amendments

Monage says the federation will offer no assistance to the government to achieve the aims and objectives of the draft policy on measures to restrict and regulate trade in ferrous and non-ferrous metals waste, scrap and semi-finished ferrous and non-ferrous metal products.

The federation is concerned about the prohibition on the use of cash in scrap and waste metal transactions.

“This will result in unintended economic consequences and hardship for the waste pickers who comprise a large bona fide segment of the supply chain,” says Monage.

He says the 350,000 waste pickers (as per the Department of Trade Industry and Competition) will feel threatened by the proposed blanket prohibition.

“Not only will the proposed prohibition lead to economic devastation, but it will also cause poverty for the waste pickers and people who rely on them,” he adds.

“These waste pickers are not criminals dealing in stolen material but rather legitimate self-employed individuals who are desperately trying to eke out a lawful living collecting untainted scrap metal from legitimate sources and supplying it to registered dealers,” he says.

He stresses that most of the waste pickers are from the informal sector, and many of them do not have the means to establish bank accounts or put in place other channels for the receipt of funds electronically.

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Damage of infrastructure

He says they believe the major contributing factor to the damage to infrastructure comes from the procurement and trade in tainted copper. The amendment of the act can still curb the damage made to infrastructure and the economy will still be met.

They believe the measures that can be put in place include sellers being paid in cash for copper scrap and waste but limited to R10 000 per transaction. “We believe that it would be very unwise to eliminate this critical and crucial part of the supply chain which represents the very foundation of most recycling activities.”