Hammond U- turn over plan to scrap 1p coin
PLANS to ensure that Britons will be able to carry on ‘spending a penny’ will be unveiled this week.
Chancellor Philip Hammond is set to confirm that a controversial proposal to abolish 1p and 2p coins has now been ditched.
The about-turn comes more than a year after Mr Hammond described the coins as ‘obsolete’.
The plan sparked protests, with the Chancellor labelled a ‘penny-pincher’ and Downing Street distanced itself from the idea. In an announcement this week, the Chancellor is expected to say the abolition plan is now dead. A well-placed source said: ‘We will confirm the penny coin won’t be scrapped. You’ll still be able to spend a penny under this Government.’
A Treasury review is expected to safeguard access to cash for people who need it and a new coin-checking service to combat fraud is planned.
Mr Hammond’s penny abolition plan came in last year’s Spring Statement. He also questioned the future of the £50 note amid claims that it is used almost exclusively by criminals.
But Labour MP Wes Streeting complained that as well as leaving working people with ‘fewer pounds in their pocket’, Mr Hammond now wanted to ‘take away people’s one and two pennies, too’. In 2017, it was reported that ex-Chancellor George Osborne had come within weeks of scrapping pennies but was blocked by then-PM David Cameron.
Downing Street reportedly feared the ‘symbolism’ of the Tories doing away with coins would be a vote loser after warnings from charities that their donations would suffer.
More than 500 million 1p and 2p coins have to be produced each year, as so many of them are lost.