New Scientist - USA (2019-12-21)

F

IND a penny, pick it up, and all day long

you’ll have ... an annoying and practically

worthless disc of copper-electroplated

steel rattling around in your pocket. Far from

stooping to pick them up, most of us are

actively trying to get rid of the luckless things.

According to the UK Treasury, 60 per cent of

one and two pence coins are used once then

lost, stashed or thrown away. Last year, for the

first time in decades, the UK’s Royal Mint didn’t

make any copper coins. There were already

more than enough in circulation.

So why doesn’t the UK follow the lead of

Canada, Ireland and many other countries

and put these coins out of their misery?

Change, it turns out, is hard. Over the years,

the UK’s Bank of England, Treasury, Royal Mint

and even a prime minister have thrown in their

tuppenny-ha’penny worth to defend copper

coins. One argument is that getting rid of

them will cause inflation; another is that it

will prevent shops from selling goods at

that magical £X.99 price point.

Now, though, there is a new reason to

want to see the back of coppers: it would,

ironically, help save cash from being

abandoned altogether.

Finding a penny was once a genuine slice

of luck. A century ago, a British penny (then

1/240th of a pound) was worth the equivalent

of 20 new pence. But today, there is literally

nothing you can buy with one in the shops.

The cheapest item on sale at the UK’s leading

supermarket is a sweet that would once have

been called a “penny chew”. It costs 10 pence.

This is the inevitable fate of small

denomination coins: inflation gradually gnaws

away at their purchasing power, rendering

them obsolete. The last time the UK dropped

one was in 1984, when the halfpenny was

deposited in the great piggy bank in the sky.

Since then, many other countries have

taken their smallest coins out of circulation,

such as Belgium, which binned its one and two

euro cent coins in 2014. But it didn’t abolish the

denominations: cash purchases are simply

rounded up or down to the nearest five cents.

A winning solution, surely – so how long

82 | New Scientist | 21/28 December 2019

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To save the future of cash, we should ditch our

smallest coins and introduce an unlikely new

one, says Graham Lawton