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Nickel may become Canada's new penny
Pity the Poor Penny;
Most Say It's Not Worth
the Copper It's Minted With
By the Canadian Press
Thursday, October 11, 2007
OTTAWA -- Canadians have given the Royal Canadian Mint more than their two cents worth about what they can do with that ubiquitous brown coin filling jars around the house.
In a survey on the future of the penny, Canadians and particularly retailers have told the Mint that it should follow the example of Australia and New Zealand and get rid of the nuisance coin.
The poll found that an overwhelming majority (63 percent) of small retailers -- the fast food restaurants, grocery stores and coffee shops that regularly come into contact with the coin -- want the penny to be removed from circulation, while only 19 per cent favoured its continuance.
The opinion was more split with customers. Of 1,500 Canadians polled, 42 per cent agreed with retailers that the penny is not worth the copper it's minted with, although 33 per cent said they still wanted it around.
One reason for customers' greater reluctance to get rid of the penny is that Canadians overwhelming believe retailers will use this as an excuse to round prices up, rather than down.
The two most often cited reasons for getting rid of pennies by retailers are that they cause them to carry too much change and they are practically worthless. In fact, the vast majority of retailers say they allow customers to purchase a product even if they are a penny or two short.
And customers told the Mint that they often toss their penny change into a jar on the counter.
But the penny has its defenders, including large retailers that are concerned about limiting pricing options and tax implications.
A spokesperson for the Mint said no decision has been made on whether to act on the survey results, adding that it would be up to government to order the penny's removal.
And Christine Aquino of the Mint wanted to clear up one general misconception -- the penny is worth more than it costs to make it, although it's a close call.
The Mint survey does make it clear that removing the penny would not be an easy proposition. There are approximately 26 billion in circulation and the Mint churns out a billion more each year.
The easy part would be to simply stop making them. But after that it gets more complicated, the Mint says.
For instance, some suggestions are for the Mint to buy back all the pennies and melt them down, although collecting 26 billion pennies would take time. And what would happen to hoarded pennies that were not turned over for destruction, would they remain legal tender?
Another reason to retain the penny, a large majority of Canadians told the Mint, is that it is simply part of Canada's heritage. And that is worth something.
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