21/28 December 2019 | New Scientist | 83Some self-service
checkouts dish
out irrationally
large quantities
of changehave 1p and 2p coins got? Don’t cash in your
coppers just yet. Last year, the then prime
minister, Theresa May, announced that the
coins were safe for “years to come”.
The decision was hailed by fans of cash,
who said that pinching pennies would have
sent a signal that society no longer cared
about the 20 per cent of people who rely
on notes and coins. But according to Adam
Townsend at Imperial College London, we
have all been short-changed: keeping coppers
will ultimately hasten the demise of cash. To
defend coins and banknotes – and there are
many good reasons for wanting to do so – we
should cull the weakest coins and introduce
a new, rather odd one.
At this point, it might be fun to ask
yourself what coin would be the most useful
addition. You might think a 99p, or a US-style
quarter. Perhaps a £3 coin? Don’t put your
money down just yet.
Townsend’s starting point was nothing to do
with the cashless society, but instead a simple
matter of annoyance. He was baffled and irked
by supermarket self-checkouts, which dish out
irrationally large quantities of change. If he
paid in cash, he never got 50p or 10p pieces,
but fistfuls of 20ps, 5ps and coppers. The
reason is that the machines are made in the
US, which has fewer coins in circulation than
the UK, and so don’t have enough change-
dispensing tubes for the UK’s eight-coin system.
That led him to a surprisingly fiendish
question: if you make a purchase with cash,
what is the average number of coins you can
expect to get back in your change?
Being an applied mathematician, he decided
to use real-world transaction data from the
Office for National Statistics about the cash
value of actual purchases of goods and
services. After crunching the numbers, he
found that the average number of coins
you can expect as change in the UK is 4.61.
This rises to 5.91 if you use a self-checkout.
For comparison, he looked at other
economies. The UK average is similar to other
places that use a “1, 2, 5” coinage system, such
as most of the eurozone. The US fares slightlyworse at 4.75. For nostalgia fans, predecimal UK
currency comes in at 4.9. Worst of all is Japan,
which uses a “1, 5” system that is common in
Asia and that pays out an average of 7.51 coins
per cash transaction.
Not coincidentally, the most change-
efficient countries include ones that recently
phased out small coins, such as Canada (3.94),
Sweden (2.32) and New Zealand (2.96). Simply
phasing out 1p and 2p coins would improve
the UK’s score to 3.43, Townsend calculated.
But he says we could do even better. As well
as taking coins away, you can add them. So he
also analysed the effect of introducing one newcoin. This brought an unexpected result: the
most efficient system, which would instantly
reduce the average number of coins in change
to 2.6, requires a coin worth £1.75.
“It’s a bit of a silly number,” he says. He
admits that he can’t imagine checkout staff
being happy with the introduction of such
an arithmetically challenging coin, but points
out that it is simply a thought experiment.
There is a genuine case for making cash
more efficient and attractive, however. “There
are good social reasons to encourage people
to use cash, which is an argument for making
coins better,” he says. Among these are privacy,
security and the fact that many people still
don’t have a bank account.
Of course, introducing a £1.75 coin wouldn’t
be a permanent fix. Inflation, like death and
taxes, is inevitable, so the price of transactions
will gradually rise, rendering the £1.75 coin less
and less efficient. Yet, as Townsend points out,
prices are to some extent influenced by the
coins in circulation. In the US and Canada, for
example, Townsend has observed that prices
ending in 25 and 75 are more common than
elsewhere, driven by quarter coins. A £1.75 coin
would temporarily stabilise prices around its
multiples, he says.
But not forever. Once coppers are gone, the
5p will be next in line for the chop. Even a £1.75
coin will eventually be considered worthless.
By then, our unloved 1ps and 2ps may well be
collectors’ items, worth more than that odd
£1.75 coin that was introduced for some stupid
reason all those years ago. So next time you
see a penny on the street, pick it up and put it
somewhere for posterity. ❚Graham Lawton is a features
writer at New Scientist. He is
on the money“ What coin would be the most useful
addition? A 99p, or perhaps a £3 coin?”
0 5 10 15 20
SOURCE: ADAM TOWNSENDIndia
Sweden
New Zealand
UK (without 1p and 2p)
Norway
Switzerland
Canada
Turkey
UK
Most eurozone countries
US
South Korea
China
UK self-service checkout
Russia
Japan
Harry Potter universe*Coin overload
Average number of coins expected in your change
if you pay with a banknote in these places*In Harry Potter’s
wizarding world, there
are 29 Knuts in a Sickle
and 17 Sickles in a
Galleon (which is taken
as the lowest “banknote”
because it is the
largest coin)Number of coinsAL
AMY^ STOCK
K^ PHOTO