The British government has affirmed that it has no current plans to scrap the country’s lowest-denomination coins, the 1p and 2p, despite a report from the Treasury that raised the possibility of such a move.
The clarification came after media and public opposition to suggestions put forward in HM Treasury’s latest consultation document, which was published this week and asks for feedback on the issue as part of a wider investigation into the use of cash and digital payments.
According to the Treasury, around six out of ten 1p and 2p coins are only used once. After this, most are simply put into savings jars or left lying around, while eight percent are simply thrown away. This means the Treasury has to mint over 500 million 1p and 2p coins every year to replace those that fall out of circulation.
It also noted that with changing purchasing habits in the UK, in particular greater use of alternatives such as contactless for low-value payments, there has been a reduction in demand for these coins.
“From an economic perspective, having large numbers of denominations that are not in demand, saved by the public, or in long-term storage at cash processors rather than used in circulation does not contribute to an efficient or cost-effective cash cycle,” the consultation stated.
However, it seems the public may not feel the same way. Several major media outlets in particular came out against any plans to scrap 1p and 2p coins, with the Daily Mail’s front page described it as a potential “PR disaster in the making”.
In response, a spokesman for prime minister Theresa May said there were “no proposals” to scrap 1p or 2p coins, and the consultation’s call for evidence is simply to help the government better understand how people use cash.
“One of the elements was whether the denominational mix of coins meets the public need. From the early reaction it looks as if it does,” he added.