It costs a pretty penny to produce a penny—about one and a half cents. So recognizing the foolishness of throwing good money after bad (many of the coppers end up in jars and fountains anyway), in 2010, the Senate Committee on National Finance put the penny under a metaphorical microscope.
Now the penny has dropped. Canada's Finance Minister recently announced that as one of the measures of our government's 2012 budget, the Canadian coin with the least value will retire from circulation altogether. In fall of 2012, the Royal Canadian Mint will stop distributing the copper maple leaf.
Many Canadians, including myself, have a particular fondness for the penny. But the job of any government is to do the sensible thing over the sentimental thing. Figures show that our little red cent has been a drag on Canada's economy for many years. Producing them has cost around $11 million more than their worth per year, and in 2006 alone, a private sector study determined an annual maintenance cost of $150 million.
Financial and business communities have made repeated calls for imposing the death sentence on the penny – it costs too much to handle. Other countries – Australia, Brazil, Finland, Israel, the Netherlands, New Zealand, Norway, Sweden, Switzerland and Britain – have already successfully exchanged the penny for better thoughts on keeping an economy strong.
As of this fall, businesses will begin returning their pennies to the Mint for recycling. They'll have more value as molten metal than they do as paperweights or in our piggybanks. No doubt more than a few Canadians will lament the passing of a national icon, but the death of the penny means Canadians will inherit significant savings.
To children counting them – if there are any out there who still do that—a penny saved will still be a penny earned (even if the coppers are only worth one twentieth of their original purchasing power). And until they disappear altogether, three pennies in a fountain – or a cash register – will still be worth three cents.
But the penny will now make a graceful exit from Canadians' pockets. Paper transactions will still be settled to the nearest cent. As pennies become scarce at the cash registers of our nations, costs will be rounded up or down. As long as we have them, we can use them to make or give change. And numerous charities are eagerly accepting the pennies weighing down our wallets and shelves. I encourage that use of them.
But for Canada, in this case at least, not having two pennies to rub together will eventually prove a good thing.