Obituary: The penny: 1876 — 2013
Gone, but not soon forgotten, Canada’s lowly penny is expiring after a life almost as long as the country’s itself. Reporter Hank Daniszewski looks back on the modest coin’s legacy.
After decades of declining worth, the Canadian penny has finally been polished off.
The venerable 1-cent coin officially dies Monday, when the Royal Canadian Mint will stop circulating it.
It was 137.
Costly to produce, and an annoyance to many, the penny had been in fading health for years. Millions of Canadians kept it stashed away, out of sight and out of mind, in jars, boxes and drawers.
In last year’s federal budget, Finance Minister Jim Flaherty decided to pull the plug on the coin.
The Royal Canadian Mint stopped making new pennies last year.
The inspiration for countless expressions, the penny is survived in Canada by its older-currency siblings the nickel, dime and quarter, and a generation of loonies and toonies. It was predeceased by similar small-currency cousins in other countries.
Eventually, all the pennies — Canada has produced 35 billion of them since 1908 — will be gathered up and melted down.
Though gone, the penny will not easily be forgotten: It can still legally be used and banks will take them, but insist they be rolled up.
Its legacy will also endure at the cash register, since starting Monday the government is “encouraging” merchants to round off all cash transactions to the nearest nickel from now on “in a fair and transparent manner.”
WHY THE PENNY HAD TO DIE
It came down to dollar and cents. It costs 1.6 cents to make each penny. Killing it will save Ottawa $11 million a year.
The penny remains legal tender indefinitely. How the new approach will work:
— Non-cash transactions, such as on debit and credit cards, will still be calculated to the cent.
— Cash-only transactions — 22% of all purchases — will be “rounded out” to the nearest nickel if merchants follow federal advice.
— Examples: A purchase costing $1.01 or $1.02 becomes $1. One costing $1.03 or $1.04 becomes $1.05
THE PENNY PROSECUTOR
Pulling the plug on the penny can’t come soon enough for John Palmer, a retired economics professor in London who’s long been one of the nation’s leading proponents for abolishing the penny. He even appeared before a Senate committee studying the issue.
Besides its high production cost, Palmer argues pennies have long been useless as currency and are a nuisance for retailers and consumers.
“I’m surprised merchants have not been making more changes in anticipation. I see more ‘penny cups,’ but merchants have not started rounding out prices,” said Palmer.
He said Canada should soon take the next step and eliminate the five-cent coin.
“Some people will feel nostalgic, but I don’t think most of us will miss the penny much.” said Palmer.
Most merchants are ready for the penny’s death, says the Retail Council of Canada. It convinced Ottawa to hold off until Feb. 4, after the holiday rush, to let merchants prepare. “We didn’t hear a lot of grumbling from members. It was never a burning issue,” said spokesperson Sally Ritchie.
— Cash-register charity boxes have been a favourite way to get rid of pennies for many years.
— Finance Minister Jim Flaherty urged Canadians to donate their penny stashes to charity, to get them out of circulation faster.
— The Tim Horton Children’s Foundation, which collects about $1 million a year in pennies, is making a last push to bring in as many as it can.
“Our millions of guests have their own motivations for putting pennies — versus nickels, dimes or quarters — in those boxes,” said foundation spokesperson Dave Newnham. “I don’t know if there is any way to predict” how the penny’s demise will affect donations.
— Habitat for Humanity for Oxford-Middlesex-Elgin has also launched a penny drive and has collected 1.4 million since last May.
— Nicknamed a ‘copper,’ the penny since 2000 has actually been made of 95% steel with a copper facing.
— Australia, New Zealand, Brazil, Finland, Israel and The Netherlands are among countries that have eliminated the penny or its equivalent.
— The Dominion of Canada issued its first penny in 1876
— Britain minted Canadian pennies until 1907.
The coin leaves a colourful legacy of expressions, some of which will have to be explained to future generations:
— Pinching pennies
— A penny for your thoughts
— A “bad” penny
— A penny saved is a penny earned
— Penny wise, pound foolish
— See a penny, pick it up and all the day you’ll have good luck