HALFPENNY NOT BEING REVALUED

Press, Volume CV, Issue 31005, 10 March 1966, Page 1

HALFPENNY NOT BEING REVALUED

(From Cur Own Reporter)

WELLINGTON, March 9.

The Cabinet has changed its mind about revaluing the halfpenny to 0.6 pence to remain in circulation and serve as a half-cent after the change to decimal currency next year, the Under-Secretary of Finance (Mr Muldoon) said today.

He said halfpennies would be retained in circulation after the change and for as long as required but would not be revalued.

On December 23, 1964, Mr Muldoon announced a Cabinet decision to revalue the halfpenny. The plan was widely welcomed.

Since then. Ministers have decided to retain halfpennies as such for “fine price shading” and not to force them out of circulation but eventually to eliminate them for lack of demand. Dual currencies will circulate for some time after the official conversion date. Although halfpennies will provide fractional “fine price shading” for goods priced and

paid for in present currency they will not for those priced and paid for in the new currency.

The new minimum decimal coin value. Ic, will be worth 1.2d —an indivisible unit of 20 per cent greater value.

Because there will be no 2.5 cent pieces in the decimal series, a coin valued at half a cent will be in demand for articles at present costing 3d or some multiples of 3d. The 3d piece itself will remain in circulation for some time after the change and will create need for a half-cent in change-giving.

All decimal prices will now have to be rounded to the nearest cent, whereas present currency prices will be sustained to the nearest halfpenny, particularly in grocery lines. HOARDING FEARED Revaluation plans had drawbacks. They raised the prospect of hoarding, because 240 halfpennies, worth 10s the day before the change-over, would have become worth 12s only 24 hours later. This is believed to have been a major factor in the discarding of revaluation plans. It had also been decided to mint no more half-pennies after this year but that decision, too, may now have to be modified. Mr Muldoon said yesterday that he believed recent reports of a shortage of halfpennies in retail trading in New Zealand had been exaggerated. MAY MINT MORE “I have asked the Treasury to ensure that it has adequate stocks erf halfpennies and pennies. In Australia, there was a penny shortage just before the change-over there. “We will mint more of the two coins if necessary to provide enough stocks." Mr Muldoon said the British choice of the pound value for the basic unit of decimal currency from 1971 had been based on a split decision of the Halsbury Committee on Decimal Currency. Although it had recognised that from the purely domestic point of view a 10s unit with no fractional cents would have been preferable, the committee and then the Government had chosen the pound to preserve the value of sterling as an international currency unit. BRITISH PROBLEMS •As a result, the British minor decimals unit, the cent, would be worth 2.4 d and there would have to be a half-cent, worth 1.2 d or N.Z.lc. Having to account in halfcents would create complications in British trading, accounting, banking and office machinery. British studies suggested that it would be 1996 or later before the fractional halfcent disappeared from circulation there, Mr Muldoon said.