I currently have $2.60 in my wallet.
$2.35 of this is made up of the following coins: $1 x 1, 50c x 1, 20c x 3, 10c x 1, 5x x3. More astute readers will of course realise that $2.35 is 25 cents short of $2.60 and that is because the last coin that I have is an Australian quarter.
In 2017 the introduction of the quarter was in part commemorative and in part experiment to see how far and wide the coins would travel. In truth, they were withdrawn by the public and kept as keepsakes for the most part but the experiment did show that a few people were in fact willing to use them.
Here's my problem. My problem is not with the fact that I have one coin in my wallet which is unusual but rather that the rest of the coins in my wallet, of which there are eight of them, are not really enough to buy anything useful. Even if you account for shinkflation where the standard 375mL can is disappearing from retail, $2.35 is not enough to buy a 250mL can of Coke at a Colesworth supermarket. Yes, it is possible to buy 2L for less than that but if all you want is a nice refreshing drink and do not need a bladder bursting amount of liquid diabetes gut rot, then you would buy a sensible amount.
Admittedly I am probably quite rare in that I still prefer to use cash for buying small items; this means that I am probably quite anachronistic in that regard. Even worse, I am one of those wacky people who like to buy fruit by the piece, bread rolls as individual baps, and meat by the slice. Yes, I am in fact quite French in this regard as I assemble my own lunch. Fruit and cold cut meat does not increase in price because you buy small quantities and baps at 55c cost $2.75 per week as opposed buying a whole loaf of sliced bread which now costs $2.70. The fun thing about carrying cash to buy small things is that funds transfer is even faster than EFTPOS, for if I hand you a five dollar note, you are now instantly five dollars richer. The network can't go down and you don't pay a fee to a bank to receive the funds.
Most of the current set of coins that we use in Australia, the 5, 10, 20 and even the 50 cents, have their ur-prototype in the 1816 shilling in Great Britain. While Australia was still a collection of British colonies, it used British coins. It took 9 years after the enactment of the Commonwealth before Australia got its own coins and even then, the whole entire planchet set was a 1:1 facsimile of British coins. It wasn't until decimal currency that we got out first deviation with the 1 and 2 cents which were different, and the 50 cent coin which sat on the planchet of the half crown.
Apart from the one and two dollar coins, Australia's coinage is designed for a time which was more than 200 years ago and I think has long outlived its welcome. If coinage has one purpose which is to facilitate basic commerce and it doesn't do that very well, then it seems to me that the best thing to do would be to replace it. I note that Britain already replaced its 5 and 10 pence coins, as well as replacing the 50 pence coin and made all of them smaller.
The smallest of our coins currently in circulation, the five cent coin, when it was introduced, has roughly the same buying power as $23.39 does today. The 10 cent coin has roughly the same buying power as $46.78 does today. The 10 cent coin was exactly equivalent to the shilling upon conversion to decimal currency in 1966. Bob Cratchitt in "A Christmas Carol" by Charles Dickens which was written in 1840, was paid (what was quite a handsome wage at the time) of fifteen shillings a week. It is interesting that the tradition of putting a sixpence into the Christmas pudding which is roughly contemporary to that, is still like putting the equivalent of about $20 into someone's mouth now. It's not a huge sum of money but it is not insignificant. By the time that Enid Blyton came to write the Noddy books in 1949, Noddy's standard charge for a ride in his little red and yellow car is sixpence; which wasn't much for a big person but still reasonably exciting for a small person.
As I write this in 2024, five cents which is exactly the same size and equivalent to sixpence, is so pathetically valueless that it actually isn't worth most people's bother to pick up. All three of the five cent coins in my wallet came to be there because I did bother to pick them up; before they jammed the workings of escalators.
What do you do when a thing doesn't actually do the job it was designed to do? You either throw it away, which is evidently what people already do with five cent coins, or you change the thing so that it does do the job it was designed to do. I prefer the latter. I do not propose that we make the current set of coins smaller but rather, replace all of the silver coloured cupro-nickel coins with the quarter and replace the five dollar note with a coin. This would mean that instead of six coins, there would be only four.
How would rounding work? Exactly the same way as it does now. Electronic payments are rounded to the cent. In principle they can be rounded to the mil and in practice the only organisations that do round money to the mil and smaller are petrol stations and people doing dividend calculations like BHP who declare dividends to six places after the decimal point. At the other end of the
All that aside, twelve goes down and thirteen goes up. Thirty-seven goes down and thirty-eight goes up. Sixty-two goes down and sixty-three goes up. Eighty-seven goes down and Eighty-eight goes up. It this sounds hard, then remember that we have already been through this kind of process in 1992 when 1 and 2 cent coins were quite rightly removed. That 2 cent coin had roughly the same buying power as 7 cents does not and that was not enough for it to survive.
I do not think that there will be the same kinds of objections from charities this time around either. When 1 and 2 cent coins were removed from circulation, there was minor outcry that charities would lose out because people were saving up 1 and 2 cent coins. I do not think that charities want the hassle of collecting tiny change as it is now; much less object to it being gone.
Moreover I do not think that there would be much, if any, objection from the general public either. The people who currently do not use cash have no reason to object and the people who carry cash would I think, be more happy in carrying more useful cash. I find it slightly weird that the change in our pockets which was designed for use 208 years ago, still persists. Using the very long historical rate of inflation of 4% since the founding of the City of Rome in 1 Ab Urbe Condita (753BC), then even the Farthing had more buying power than the biggest coin which I would propose ($5). Part of the reason why we are now a semi-cashless society is that the uselessness of cash to do its only purpose, makes it hard to use. We can make it better.
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