Budget 2024 – what does it mean for metal recyclers?
Cameron Leitch, BMRA’s Policy and Sustainability Manager, details what today’s budget could mean for metal recyclers for the years to come.
You have to go back 14 years for the last time a Labour Chancellor waved that red Budget box in Downing Street. Back then it was Chancellor Alistair Darling. This time, it’s the first female chancellor in its 800-year history, Rachel Reeves.
Prior to the General Election, BMRA conducted a manifesto audit of Labour’s pledges. The contents of the manifesto seemed largely positive for business. We rated several Labour policies, such as plans to launch an industrial strategy, procurement reform and action on late payments as all pro-business. However, many people additionally supported Labour at the election because of its promise to protect “working people”.
Yet people listening to, or reading, the news in recent weeks would have seen several senior Labour officials stumble over definitions of who exactly “working people” are. But on the bare face of it, you have to assume working people are people who work and that definition includes everyone within the metals recycling industry.
As such, the announcement today, that Employer National Insurance contributions would rise from the current rate of 13.8% on earnings above £9,100 a year to 15% on earnings above £5,000 cannot be welcomed by the BMRA. For every BMRA member, this tax rise will make every job much more expensive to maintain. This tax rise could also have the knock-on effect of preventing new hires, which in turn could thwart our industry’s capacity to support Labour’s mission to drive economic growth.
For metal recyclers who pay a proportion of their staff the minimum wage, or close to it, the cost of employing staff will go up further. This is because the Chancellor announced the minimum wage for all age categories will go up from April 2025. The minimum wage for over 21s will rise by 6.7%, from £11.44 to £12.21 from April 2025. For 18 to 20-year-olds, the minimum wage will rise from £8.60 to £10, while apprentices’ pay will rise from £6.40 to £7.55 an hour.
Reeves also confirmed the upcoming Landfill rate changes starting in April 2025 and set out by previous Chancellor Jeremy Hunt in his Spring Budget. To remind readers, the standard rate of disposing waste in landfill will increase to £126.15 from April 2025, up by £22.45 from 2024’s rate of £103.70. The lower rate of landfill tax for inert waste will also rise from £3.30 to £4.05.
As landfill operators are tasked with paying this tax, which they pass onto customers, the cost of disposing waste in landfill will be going up.
Besides tax, pay and landfill, there was some welcome news in the Chancellor’s Budget. The freeze on fuel duty will continue and the additional 5p cut will be maintained for another year. This pledge will ensure metal recyclers, reliant on diesel to power their plant machinery, will not see a considerable increase in fuel costs until at least 2026.
Additionally, Reeves restated her Government’s commitment to an industrial strategy and the National Wealth Fund. On the latter, we will continue to work with Government to ensure BMRA members will be able to access the £1.2bn-£2.3bn of investment in “scrap facilities” earmarked by the National Wealth Fund Taskforce if deployed.
Cameron Leitch, BMRA’s Policy and Sustainability Manager, details what today’s budget could mean for metal recyclers for the years to come.
You have to go back 14 years for the last time a Labour Chancellor waved that red Budget box in Downing Street. Back then it was Chancellor Alistair Darling. This time, it’s the first female chancellor in its 800-year history, Rachel Reeves.
Prior to the General Election, BMRA conducted a manifesto audit of Labour’s pledges. The contents of the manifesto seemed largely positive for business. We rated several Labour policies, such as plans to launch an industrial strategy, procurement reform and action on late payments as all pro-business. However, many people additionally supported Labour at the election because of its promise to protect “working people”.
Yet people listening to, or reading, the news in recent weeks would have seen several senior Labour officials stumble over definitions of who exactly “working people” are. But on the bare face of it, you have to assume working people are people who work and that definition includes everyone within the metals recycling industry.
As such, the announcement today, that Employer National Insurance contributions would rise from the current rate of 13.8% on earnings above £9,100 a year to 15% on earnings above £5,000 cannot be welcomed by the BMRA. For every BMRA member, this tax rise will make every job much more expensive to maintain. This tax rise could also have the knock-on effect of preventing new hires, which in turn could thwart our industry’s capacity to support Labour’s mission to drive economic growth.
For metal recyclers who pay a proportion of their staff the minimum wage, or close to it, the cost of employing staff will go up further. This is because the Chancellor announced the minimum wage for all age categories will go up from April 2025. The minimum wage for over 21s will rise by 6.7%, from £11.44 to £12.21 from April 2025. For 18 to 20-year-olds, the minimum wage will rise from £8.60 to £10, while apprentices’ pay will rise from £6.40 to £7.55 an hour.
Reeves also confirmed the upcoming Landfill rate changes starting in April 2025 and set out by previous Chancellor Jeremy Hunt in his Spring Budget. To remind readers, the standard rate of disposing waste in landfill will increase to £126.15 from April 2025, up by £22.45 from 2024’s rate of £103.70. The lower rate of landfill tax for inert waste will also rise from £3.30 to £4.05.
As landfill operators are tasked with paying this tax, which they pass onto customers, the cost of disposing waste in landfill will be going up.
Besides tax, pay and landfill, there was some welcome news in the Chancellor’s Budget. The freeze on fuel duty will continue and the additional 5p cut will be maintained for another year. This pledge will ensure metal recyclers, reliant on diesel to power their plant machinery, will not see a considerable increase in fuel costs until at least 2026.
Additionally, Reeves restated her Government’s commitment to an industrial strategy and the National Wealth Fund. On the latter, we will continue to work with Government to ensure BMRA members will be able to access the £1.2bn-£2.3bn of investment in “scrap facilities” earmarked by the National Wealth Fund Taskforce if deployed.