A nickel for your thoughts on penny abolition

MP introduces private member's bill to halt penny production

Tuesday, April 7th, 2009

The expression “A penny for your thoughts” and countless others may be a thing of the past if a Winnipeg MP has his way.

Pat Martin, New Democratic MP for Winnipeg-Centre, introduced a private members’ bill in the House of Commons on Wednesday that, if passed, would end production of the penny, eliminate it from circulation, and round prices for cash transactions to the nearest nickel.

Pennies would no longer be accepted as legal tender, but Canadians would be able to trade in their penny collections for other currency for a period of time.

Kul Bhatia, an economics professor at Western, agreed with the proposal.

“If it’s a straight cost-benefit analysis, then it’s a good idea,” Bhatia said, adding each penny costs four cents to produce.

According to Martin, a 2007 study by the Royal Canadian Mint found 63 per cent of retailers and 40 per cent of consumers are in favour of abolishing the penny, which costs $130 million per year to produce.

“If Canadians knew how much they cost [to produce], those numbers would go up,” Martin said.

Rounding prices to the nearest nickel would not apply to credit and debit card transactions, and would apply to total transactions, not individual items.

Under the proposed system, a CLT at the Spoke " where only cash is accepted " would cost $4.15 including tax, down two cents from the current price.

Theoretically, retailers could force all prices to be rounded up by raising prices to end in three, four, eight, or nine, which worries second-year international relations student Jessica Dubinsky, who is against Martin’s bill.

“[The penny] is a part of Canadian culture,” she said.

Martin said culture is one of the main reasons some Canadians are against abolishing the penny.

“We have a romantic association with the penny,” he said, referring to olden days of penny candy.

Russ Courtney, a third-year media theory and production student, is less romantic about pennies.

“It seems to be an annoyance to have them,” he said.

Martin acknowledged charities that rely heavily on penny donations may be hurt by the proposal, but the savings from not producing pennies would free up the government to increase support of charities.

Although private members’ bills tend not to pass, Martin is confident his will.

“MPs from all four parties are interested,” he said.

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