Author Topic: HM Treasury has doubts about future of 1 and 2p coins  (Read 3488 times)

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Offline chrisild

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #60 on: April 28, 2019, 02:14:46 PM »
Well, as long as the low denomination are softly "phased out" (your previous post), the set is still complete. The mint might even continue to make these pieces, for collectors only ...

Christian

Offline Alan71

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #61 on: April 28, 2019, 04:22:54 PM »
BBC News app says:
ďThe Mail on Sunday quoted a government source as saying: "We will confirm the penny coin won't be scrapped."

Does that mean the 2p might be?

Offline eurocoin

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #62 on: April 28, 2019, 04:24:07 PM »
BBC News app says:
ďThe Mail on Sunday quoted a government source as saying: "We will confirm the penny coin won't be scrapped."

Does that mean the 2p might be?

I was wondering about the same, although I think it unlikely.

Of course we should also not forget that if they decide to keep the coins, that does not necessarily mean that everything stays as it currently is. They may still make changes to the metallic composition or design of the 1p and 2p coins to lower the costs.

Offline Alan71

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #63 on: April 28, 2019, 08:57:10 PM »
Are there any metals much cheaper than steel though?

Iíd like to see a re-sizing, but itís too late for that.  It would enable them to recover the remaining bronze coins from circulation though and people would be forced to cash in their jars of them.

If they do allow them to remain, but cease production of new ones, how long could that go on for?  If people really do throw them away, at some point there would be too few left.  However, in the last couple of years or so, hardly any new ones have appeared and Iíve seen more 1970s to 1990s coins than I have done for years.  At one point, it seemed like every other 1p coin I got in change was the latest date.

Offline FosseWay

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #64 on: April 28, 2019, 10:02:13 PM »
Metals cheaper than steel - aluminium probably is, size for size. You can get a lot more coins of a given size out of a kilo of aluminium.

As to how long the situation can last where coins are no longer produced but can still be used - Canada did precisely this. They stopped minting the 1c coin in 2012 (?) but AFAIK have never officially withdrawn it. Does anyone know how much 1c coins circulate in practice there?

I'm not sure what ditching the 2p but not the 1p would achieve. Two pennies weigh the same as a twopence. If you want to resize them and lose the weight to value ratio, that would result in savings relating to the 2p, but in that case you would actively lose out by having only a 1p coin (since 4p in pennies would weigh 4x the weight of one penny, whereas two twopences would be lighter).

Offline eurocoin

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #65 on: May 03, 2019, 08:27:37 AM »
HM Treasury has around midnight released a statement saying the 1p and 2p will not be demonetized and will not be changed.

Offline andyg

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #66 on: May 03, 2019, 09:09:41 AM »
As I said at the start of this thread - once a prime minister squashes an idea it stays squashed!

Anyhow, the political climate at the moment isn't right, Mrs May cannot afford to do anything even remotely controversial, especially if it might attract the faux outrage of the Daily Mail.
always willing to trade modern UK coins for modern coins from elsewhere....

Offline Alan71

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #67 on: May 03, 2019, 09:19:02 AM »
HM Treasury has around midnight released a statement saying the 1p and 2p will not be demonetized and will not be changed.
I have to wonder why they bothered announcing on Sunday (or whenever it was) that there was going to be an announcement, if nothing is actually going to change!  And when it finally was announced, local election results were coming through. 

A future change of government could always reverse the decision, but Labour donít tend to mess with the coinage.  They brought decimalisation, but any changes to the coinage since have come about due to Conservative government decisions.

Offline hertfordian

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #68 on: May 03, 2019, 11:22:52 AM »
Whilst noting the above comments that have come up since the (non-) announcement today, one thing I have noted but perhaps I just haven't read enough detail on the subject -

Whilst the government are saying that the coins will not be changed or demonetised, are they actually confirming that they will continue to be minted and issued though (or will we have a situation such as I believe has happened in Canada amongst other places based on some postings here the other day)?

After all, considering the change from a few years ago when every year, you would without fail be inundated with new pennies (if not 2p coins), I haven't seen any newer coppers than 2016.  I therefore wonder if there *has* been a decision made but a more subtle one so as to go under the radar of the Daily Mail and the Express. 

Ian
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Offline eurocoin

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #69 on: May 03, 2019, 12:03:19 PM »
Although I agree that the statement is vague (like many coin related statements of HM Treasury), I am sure that if they had decided to no longer produce the 1p and 2p coins, they would have announced it regardless of the possible criticism of the media.

Offline GCVO

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #70 on: May 03, 2019, 12:06:52 PM »
As to how long the situation can last where coins are no longer produced but can still be used - Canada did precisely this. They stopped minting the 1c coin in 2012 (?) but AFAIK have never officially withdrawn it. Does anyone know how much 1c coins circulate in practice there?

They disappeared from circulation nearly instantaneously when banks stopped giving them out in February 2013. Any that are spent go on a one-way trip to their deaths.

Canada historically followed the USA in rarely/never demonetizing obsolete currency. That changed with regard to banknotes last year, but not coins yet.

Offline Pabitra

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #71 on: May 03, 2019, 03:47:36 PM »
Stopping minting and banks giving them out are two distinct and different activities.

The banks continue to give out if there is demand for them.They give out from what they get in from stores and persons who handle small coins as a part of their professional activity ( roadside musicians for instance).
When the incoming deluge of small coins is larger than outgoing, the banks do not need to indent from central bank or mint.
In such scenario, the fresh minting stops since aggregated projected requirement to the mint is zero.
The coins remain in circulation and very much legal tender.
Since there is no fresh demand, there is no reason to mint and hence no reason to look for smaller, different alloy or cheaper alternatives.

Offline FosseWay

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #72 on: May 03, 2019, 04:01:00 PM »
^ That ignores the facts of how these coins are used in reality in the UK. They are generally handed out in change and then hoarded. Some of those hoarded eventually get paid in in bulk to bank accounts or donated to charity, but the sheer number of new 1p coins that historically have been minted each year suggests that the majority simply disappear, either for ever or for a sufficiently long time for them not to be relied on as part of the ongoing supply.

If you are going to retain them in use, you have to guarantee that the supply of them will meet demand. You can't have situations where people are expecting odd numbers of pennies in change but retailers can't provide them. The alternative is to go for "Swedish" rounding. The situation in this respect is different from other situations where UK coins have ceased to be made but continued to be valid currency, such as with the old sixpence in the first 9 years of decimal currency. They became scarcer and scarcer in use, but this didn't matter because there were other ways of making up the sum in question.

Someone upthread mentioned that now is not the time in the UK to make controversial decisions relating to matters of the heart, and that comment was spot on. There is no sensible reason for 1p and 2p coins to continue in use. Their tiny value and the fact that more and more transactions are electronic and can be paid precisely regardless of the status of the coins mean that the loss of the coins would be insignificant to more or less any individual consumer. Where there might be a negative would be for charities, which benefit from people hoarding coppers and then donating them in bulk.

But messing with the coinage is emotive, and getting rid of a basic denomination like the penny doubly so. Regardless of how much knowledgeable people would point out that the decimal penny is actually not all that old or historic, there would be strident headlines about abolishing a denomination that stretches back to Offa and so forth. There are plenty of other issues in play at the moment that involve opposition between heart and head; we don't need another one.

Offline Alan71

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #73 on: May 03, 2019, 04:45:01 PM »
After all, considering the change from a few years ago when every year, you would without fail be inundated with new pennies (if not 2p coins), I haven't seen any newer coppers than 2016.  I therefore wonder if there *has* been a decision made but a more subtle one so as to go under the radar of the Daily Mail and the Express.
There was an issue of 1p coins dated 2017.  It was by no means a small issue, but Iíve not had that many of them in change.  Itís possibly still too early to call on whether there will be a 2018-dated issue.  Apart from one date, 1972, the 1p has had a continuous date run from 1971.  The last 2p date Iíve seen is 2016.  Previously only six dates werenít issued: 1972 to 1974 and 1982 to 1984.

However, the lack of new coins is consistent across most of the denominations and probably reflects the move to more electronic payments.  The government perhaps donít want to force the issue - if coin use is declining generally, there will be a surplus held in bank vaults etc.  Why withdraw 1p and 2p coins if new coins of other denominations arenít required?  Melting them down and turning them into what?

Earlier in the decade, the Royal Mint had a cupro-nickel recovery program going on which meant masses of new steel 5p and 10p coins replacing the old.  This program not only appears to have stopped, but Iím wondering if itís gone into reverse.  More recently, Iíve seen increasing numbers of 1990s and 2000s 5p and 10p in change.  I wonder if some of the ones withdrawn were not melted down and have now been put back?

Also the emphasis appears to be on choice - cash users should not be treated differently to others, and ďroundingĒ would do precisely that. 

Iím happy to see the 1p and 2p remain.

Offline <k>

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Re: HM Treasury has doubts about future of 1 and 2p coins
« Reply #74 on: May 03, 2019, 04:51:57 PM »
Earlier in the decade, the Royal Mint had a cupro-nickel recovery program going on which meant masses of new steel 5p and 10p coins replacing the old.  This program not only appears to have stopped, but Iím wondering if itís gone into reverse.  More recently, Iíve seen increasing numbers of 1990s and 2000s 5p and 10p in change.  I wonder if some of the ones withdrawn were not melted down and have now been put back?

I'd noticed the same in recent days and wondered about it too. 

Quote
Iím happy to see the 1p and 2p remain.

I am not. They are only ever used in supermarkets. In cafes, everything is priced in multiples of 10p, so even the 5p isn't of much use these days.