TORONTO — They clutter your dresser and cost too much to make. They’re a nuisance and have outlived their purpose.
Finance Minister Jim Flaherty was talking about the Canadian penny and why the Royal Canadian Mint will end its production this fall as part of his austerity budget.
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“The penny is a currency without any currency in Canada, and it costs us 1.5 cents to produce a penny,” Flaherty told reporters.
Responses Friday were mixed, with some Canadians saying it would make life easier, while others worried it would become an opening for sneaky price hikes.
David Berman, a blogger at the Toronto Globe and Mail, took issue with Flaherty calling the penny a nuisance. “For a government that has been warning Canadians against piling on too much debt, it seems like a contradiction to then denigrate the one-cent coin – hey, it’s still money – as nothing more than a waste of space. It isn’t.”
Flaherty said a Canadian senate committee held hearings on the penny last year and not one witness came forward to say it should be spared.
A government statement said New Zealand, Australia, the Netherlands, Norway, Finland, Sweden and others “have made smooth transitions to a penny-free economy.” It said penny production cost $11 million a year, and that the coins, which feature two maple leaves and Queen Elizabeth II in profile, would remain legal tender until they eventually disappeared from circulation.
The U.S. Treasury Department cited a statement from Treasurer Rosie Rios from earlier this year when asked about the Canadian decision. She said the Obama administration has looked at possibly using cheaper materials to make the penny, which is now made of zinc.
That’s quite a difference from when candidate Barack Obama was campaigning to become president. “We have been trying to eliminate the penny for quite some time – it always comes back,” Obama said at the time. “I need to find out who is lobbying to keep the penny.”
Two separate bills calling for the demise of the penny, introduced in 2002 and 2006 by Republican congressman Jim Kolbe, failed to advance in the U.S. House of Representatives.
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