TORONTO - The phasing-out of the penny will lurch ahead today with the Royal Canadian Mint officially ending its distribution of one-cent coins to Canada's financial institutions.
The move comes nearly a year after Finance Minister Jim Flaherty announced the demise of the penny, whose production cost came to exceed its monetary value.
But as it faces extinction in the pockets and tills of most Canadians, the humble penny is still in demand in some artistic circles where it retains significant value.
Renee Gruszecki, a Halifax-based academic and archivist, has spent the past year making a living through a jewelry business devoted primarily to preserving the country's stray cents.
About 30,000 strategically sorted pennies fill Gruszecki's home and eventually find their way into the accessories produced at Coin Coin Designs and Co.
Gruszecki, a long-time collector of lucky pennies, believes her pieces will help preserve a symbol that is both an object of superstition and a Canadian icon.
"The maple leaf is synonymous with everything Canadian. We all identify with it," she said in a telephone interview. "Now it's just no longer going to be present among us, so I'm saddened by that."
The Bank of Canada's Currency Museum has already taken steps to preserve the penny's place in Canadian culture.
A mural consisting of nearly 16,000 one-cent pieces has been assembled at the museum to commemorate the coin's history, said assistant curator Raewyn Passmore.
The mosaic, which depicts a giant penny measuring about two square metres, is comprised of coins ranging from the lustrous to the tarnished.
Passmore said the design was meant to honour a coin which, while lacking buying power now, enjoyed many years of prominence since its first minting in 1858.
"It was probably the most common coin in circulation at one point and probably the most useful for ordinary people," she said. "We wanted to make a tribute to a sometimes overlooked coin."
The penny's current lack of value was the impetus for its demise, a point recently driven home to Canadians hoping to use their discarded coins to raise money for charity.
Jeff Golby, director of charity bank Chimp Fund, launched a publicity campaign shortly after the last penny was struck in an effort to persuade Canadians to discard their copper coinage into the coffers of cash-strapped organizations.
A massive penny party held in downtown Ottawa netted more than 120,000 cents, but it only served to starkly illustrated the coin's economic shortcomings.
Canadians who want to dispose of their spare change, Golby said, could find better uses for it than stopping by a charitable penny drive.
"On some level you go, 'OK, it can't hurt,' but when you factor in what it costs to charity . . . in time, in rolling costs, it's not a cost-effective way for charities to really actually net decent money," he said.
The logistical challenges associated with the penny were among the reasons Flaherty cited for discontinuing the coin, adding that the economic toll worked out to about $11 million a year.
Retailers will be among the first to phase out the coin, and Canadians will see the effects almost immediately.
The Federal Government has issued guidelines urging store owners to start rounding prices up, or down, to the nearest nickel for cash transactions. Electronic purchases will still be billed to the nearest cent.
Internet search-engine giant Google is marking the passing of our penny with a dedicated doodle on its Canadian homepage.
And while some may lament the one cent coin's end of days, it's been a bit of a boon for penny wise entrepreneurs like Gruszecki.
Sales of her jewelry spiked as the coin's demise drew nearer, she said, adding that Canadians' disregard for the coin as a form of legal tender has not diminished their sense of its value.
"I hope my jewelry will serve as a means for them to save a penny and keep the penny in circulation," she said.
"If you're wearing it on a ring or you're wearing it around your neck, you keep its visual presence certainly alive. If there can be an additional layer of meaning to it, all the better."
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When Does It End?
The Royal Canadian Mint stopped making new pennies in May, 2012, after the government announced in its spring budget it’s discontinuing the coin. On February 4, 2013, the Mint will stop distributing pennies to financial institutions, marking an official end to the era of the penny. But pennies will still be around, and will only fully disappear as stores stop using them over time.
Do I Have To Stop Using Pennies?
No. You can keep using pennies for as long as you want, but stores will no longer have to accept them. As time goes on, it will become harder and harder to use pennies as fewer and fewer stores accept them.
How Will Prices Change?
They won’t. Or at least they shouldn’t. The idea of “one cent” isn’t going away — a store can still advertise something as costing 99 cents, even if you can’t pay that price physically. It’s only at the point of sale that prices will be rounded up, once taxes and everything else have been calculated.
How Will Rounding Work?
Any price that doesn’t end in a five or a zero will have to be rounded up or down. The Mint has released a set of guidelines for this. If a price is a few cents above a five or zero, you round down; otherwise you round up. So if something costs $1.01 or $1.02, the price become $1.00. If something costs $1.03 or $1.04, it becomes $1.05. But these are guidelines, not the law, and some stores may choose to simply round up for everything.
What About Credit And Debit Cards?
For electronic transactions, cheques and money orders, nothing will change. A $1.03 purchase on Interac will still cost you $1.03.
Are We Ready For This?
Maybe. Almost. According to a survey from the Retail Council of Canada, nearly a quarter of Canadian retailers say they’re not prepared for the switch, with another quarter uncertain. So prepare for the possibility of a few glitches here and there at the checkout line, as retailers adjust to the new reality.
Has Anyone Tried This Before?
Sure. Australia got rid of its penny in 1966, when it switched from the Australian pound to the Australian dollar. The land down under has been doing nicely with five-cent pieces ever since. And over the years countries have often eliminated their smallest currency denominations as inflation ate into their value.
Will My Pennies Be Worth More Once The Penny Is Eliminated?
It’s inevitable that pennies will go up in value as they become historical artifacts. But don’t expect them to make you a millionaire anytime soon. There are literally billions and billions of Canadian pennies out there, with a market value of about 1.5 cents each, based on their metal content. It will take many years for pennies to become valuable collectors’ items. But the pennies in your pocket are actually already worth more than their face value, thanks to the high price of metals in recent years. One of the main reasons for discontinuing the penny is that it costs more to produce than it’s worth. So if nothing else, you can always sell a penny for scrap metal, and make a (tiny) profit.
How Can I Get Rid Of My Pennies?
If you’re not interested in collecting pennies on the chance they’ll go up in value, you can take them to your local bank. They’ll pay you for the pennies’ value in a larger denomination, and send the pennies along to the government, which will in turn reimburse the bank.
How Many Pennies Are They Taking Out Of Circulation?
The Royal Canadian Mint says it’s nearly impossible to tell how many pennies there are in circulation, because of hoarding by consumers. But in recent years more than 800 million pennies were minted per year, typically, though the numbers fluctuated wildly. In 2011, the Mint issued 1.1 billion pennies, up from 486 million the year before. So it’s fair to say there are billions and billions of them out there. Pictured: Jim Flaherty, Minister of Finance, with Ian Bennett, president and CEO of the Royal Canadian Mint
What Coin Will They Get Rid Of Next?
It will probably be some time before Canada eliminates another coin denomination, but there is already chatter out there about <a href="http://www.huffingtonpost.ca/2013/01/02/canadian-penny-nickel-discontinued_n_2396990.html">the nickel being more trouble than it’s worth....</a>