1p and 2p coins given a reprieve
The Chancellor recently consulted on whether the current mix of coins and banknotes in circulation was serving its purpose. Society is increasingly cashless, with card payments overtaking cash payments for the first time at the end of 2017.
However, the Treasury has estimated that 2.2 million people in the UK are reliant on cash and a disproportionate number of those are elderly or vulnerable. An independent review of cash published in March said eight million people still needed cash.
The 1p and 2p coins were under threat. One survey suggested that six in 10 of UK 1p and 2p coins are only used once before being put in a jar or discarded. One in 12 is thrown into a bin. The 1p coin is now worth less than the halfpenny when it was abolished in 1984.
The £50 note also appeared under threat, as the Chancellor implicated them in criminal activity. However, that has now been redesigned to make it less vulnerable to fraud.
Mike Cherry, national chairman of the Federation for Small Businesses, said keeping 1p and 2p coins in circulation was the right call: “The freedom to use pennies is still important to a lot of small firms. For many, being able to charge prices that end in 99p rather than a round pound figure can be enough to tip intrigue into a sale, particularly where lower-value items are concerned.”