PLANS to potentially scrap 1p and 2p coins are set to be unveiled this week, it was confirmed last night.
Chancellor Philip Hammond will rule on the future of the small denomination coins in the coming days, the Treasury said.
Copper 1p and 2p coins could be scrapped for good after the Treasury confirmed it will be making an anouncement on their future ‘shortly’[/caption]
Chancellor Philip Hammond said last year that low-denomination coins were ‘obsolete’[/caption]
It comes a year after Mr Hammond called them “obsolete” his Spring Statement – suggesting he could be prepared to ditch pennies and 2p coins.
A Government consultation about the mix of coins in circulation appeared to pave the way for the end of both copper coins.
But the Prime Minister’s official spokesman later declared there were no plans to scrap coppers.
The Treasury would not comment on reports that the coins could be saved after all.
But it confirmed that “the result of the review will be announced shortly”, the BBC reported.
1p ‘NEARLY WORTHLESS’
The Mail On Sunday yesterday quoted a government source saying the coins would stay in circulation.
Their source said: “We will confirm the penny coin won’t be scrapped.”
But according to the Treasury, surveys suggested that six-in-10 1p and 2p coins were only used once before being put in a jar or discarded.
As many as one-in-12 copper coins were binned, the consultation document said.
Due to inflation, the 1p coin is now worth less than the halfpenny was when it was scrapped in 1984.
But there are fears that retailers will jack up prices by rounding up to the nearest 5p if the coins are abolished.
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However, the rise of contactless and card payments could help counter this.
Canada, the home of Bank of England governor Mark Carney, are among several countries who have ditched their low denomination coins.
Other countries where small coins have been scrapped include Australia, Brazil, and Sweden.
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