On 15 February 1971, known as Decimal Day, the United Kingdom and Ireland
decimalised their currencies. Under the old currency of pounds,
shillings and pence, the pound was made up of 240 pence, with 12 pence in a
shilling and 20 shillings in a pound. The loss of value of the currency meant
that the "old" penny, with the same diameter as the US half-dollar, was of
relatively slight value, while the farthing, which was worth one-quarter of
an old penny, had been demonetised on 1 January 1961.
United Kingdom = Background=
Following the rejection by Parliament of Lord Wrottesley's proposals to
decimalise sterling in 1824, little practical progress towards
decimalisation was made for over a century, with the exception of the
two-shilling silver florin first issued in 1849. A double florin or
four-shilling piece was a further step in that direction but failed to gain
acceptance and was struck only from 1887 to 1890.
The Decimal Association was founded in 1841 to promote decimalisation and
metrication, both causes that were boosted by a realisation of the
importance of international trade following the 1851 Great Exhibition. It
was as a result of the growing interest in decimalisation that the florin was
issued. In their preliminary report, the Royal
Commission on Decimal Coinage considered the benefits and problems of
decimalisation but did not draw any conclusion about the adoption of any
such scheme. A final report in 1859 from the two remaining commissioners, Lord
Overstone and Governor of the Bank of England John Hubbard came out against
the idea, claiming it had "few merits". In 1862, the Select Committee on Weights
and Measures favoured the introduction of decimalisation to accompany the
introduction of metric weights and measures.
The decimalisation movement even entered fiction. In Anthony Trollope's Palliser
novels, Plantagenet Palliser is a passionate advocate of decimalisation, a
cause the other characters seem to find intensely boring. Palliser's scheme
would have divided the shilling into ten pennies. This would have changed the
threepence into 2.5 new pence, the sixpence into fivepence and the half
crown into a two shilling, five pence piece. It would also have required the
withdrawal and reissuance of the existing copper coinage. At the end of
the fifth book in the series, The Prime Minister, Palliser muses that the reform
will not be accomplished, since it can only be done by a Chancellor of the
Exchequer sitting in the House of Commons, and the Duke now sits in the
House of Lords. The Royal Commission on Decimal Coinage,
chaired by Lord Emmott, reported in 1920 that the only feasible scheme was to
divide the pound into 1000 mills but that this would be too inconvenient. A
minority of four members disagreed, saying that the disruption would be
worthwhile. A further three members recommended that the pound should be
replaced by the Royal, consisting of 100 halfpennies.
In 1960, a report prepared jointly by the British Association for the
Advancement of Science and the Association of British Chambers of
Commerce, followed by the success of decimalisation in South Africa, prompted
the Government to set up the Committee of the Inquiry on Decimal Currency in
1961, which reported in 1963. The adoption of the changes suggested in the
report was announced on 1 March 1966. The Decimal Currency Board was created
to manage the transition, although the plans were not approved by Parliament
until the Decimal Currency Act in May 1969. Former Greater London Council
leader Bill Fiske was named as the Chairman of the Decimal Currency Board.
Consideration was given to introducing a new major unit of currency worth ten
shillings in the old currency: suggested names included the new pound, the royal
and the noble. This would have resulted in the "decimal penny" being worth only
slightly more than the old penny. But Halsbury decided, in view of the pound
sterling's importance as a reserve currency, that the pound should remain
unchanged. = Preparation=
Under the new system, the pound was retained but was divided into 100 new
pence, denoted by the symbol p. New coinage was issued alongside the old
coins. The 5p and 10p coins were introduced in April 1968 and were the
same size, composition, and value as the shilling and two shillings coins in
circulation with them. In October 1969 the 50p coin was introduced, with the
10s note withdrawn on 20 November 1970. This reduced the number of new coins
that had to be introduced on Decimal Day and meant that the public was already
familiar with three of the six new coins. Small booklets were made
available containing some or all of the new denominations.
The old halfpenny was withdrawn from circulation on 31 July 1969, and the
half-crown followed on 31 December to ease the transition.
There was a substantial publicity campaign in the weeks before
Decimalisation Day, including a song by Max Bygraves called "Decimalisation".
The BBC broadcast a series of five-minute programmes, "Decimal Five",
to which The Scaffold contributed some specially written tunes. ITV repeatedly
broadcast a short drama called Granny Gets The Point, starring Doris Hare, the
actress in On The Buses, where an elderly woman who does not understand
the new system is taught to use it by her grandson.
Banks received stocks of the new coins in advance and these were issued to
retailers shortly before Decimalisation Day to enable them to give change
immediately after the changeover. Banks were closed from 3:30 pm on Wednesday 10
February 1971 to 10:00 am on Monday 15 February, to enable all outstanding
cheques and credits in the clearing system to be processed and customers'
account balances to be converted from £sd to decimal. In many banks the
conversion was done manually, as most bank branches were not yet computerised.
February had been chosen for Decimal Day because it was the quietest time of the
year for the banks, shops, and transport organisations.
Many items were priced in both currencies for some time before and
after. Prior to Decimal Day the double pricing was displayed as e.g. 1s; from
Decimal Day the order was switched to 5p. For example, this order was used on
most football programmes during the 1970–71 season. High denomination stamps
were issued on 17 June 1970. Post offices were issued with very simple
training stamps in the same colours as the upcoming decimal stamps.
Exceptions to 15 February introduction were British Rail and London Transport,
which went decimal one day early, the former urging customers, if they chose
to use pennies or threepenny pieces, to pay them in multiples of 6d. Bus
companies were another exception, going decimal on Sunday 21 February.
= After Decimal Day= Decimal Day itself went smoothly.
Criticisms included the small size of the new halfpenny coin and the fact that
some traders had taken advantage of the transition to raise prices. Some used
new pennies as sixpences in vending machines. After 15 February, shops
continued to accept payment in old coins, but always issued change in new
coins. The old coins were returned to the banks and in this way the bulk of
them were quickly taken out of circulation.
The new halfpenny, penny, and twopence coins were introduced on 15 February
1971. Within two weeks of Decimal Day, the old penny and old threepenny coins
had left circulation, and old sixpences were becoming rare. On 31 August 1971,
the penny and threepence were officially withdrawn from circulation, ending the
transition period. The government intended that in speech
the new units would be called "new pence", but the population decided that
it was clearer and quicker to pronounce the new coins as "pee". Shortenings such
as "tuppence" are now rarely heard, and terms such as "tanner", which previously
designated amounts of money, are no longer used. However the slang word
"quid"—referring to a pound and dating from pre-decimal times—has survived. The
guinea in expressions such as 80 gns has almost completely disappeared from use,
apart from a few esoteric uses, notably in the sale of horses.
The public information campaign over the preceding two years helped, as did the
trick of getting a rough conversion of new pence into old shillings and pence
by simply doubling the number of new pence and placing a solidus, or slash,
between the digits: 17p multiplied by 2 = 34, — approximately equal to 3/4, with
a similar process for the reverse conversion. The willingness of a young
population to embrace the change also helped. In general, elderly people had
more difficulty adapting and the phrase "How much is that in old money?" or even
"How much is that in real money?" became associated with those who struggled with
the change. Around the time of Decimalisation Day,
"Decimal Adders" and other converters were available to help people convert
between the old and new coins. The following is a table showing conversions
between the decimal and pre-decimal systems.
= Validity of old coins= All pre-decimal coins are now no longer
legal tender. Public outcry at the proposed demise of the old sixpence,
worth exactly 2½p and originally slated for early withdrawal, postponed its
withdrawal until June 1980. Shillings and two shillings, together
with their same-sized 5p and 10p coin equivalents, co-existed in circulation
as valid currency until the early 1990s. In theory this included coins dating
back to 1816; in practice the oldest were dated 1947 when these values
stopped containing silver. The coins were withdrawn when smaller 5p and 10p
coins were introduced in 1990 and 1992 respectively.
The face value of Maundy money coins was maintained, effectively increasing all
their face values by a factor of 2.4, as the coins continued to be legal tender
as new pence. The numismatic value of each coin, though, greatly exceeds face
value. = Subsequent changes=
The decimal halfpenny, introduced in 1971, remained in circulation until
1984, by which time its value had been greatly reduced by inflation. It was not
struck, except for collectors' sets, after 1983 and was demonetised on 31
December 1984. The 50p piece was reduced in size in 1997, following the reduction
in size of the 5p in 1990 and the 10p in 1992. The 1p and 2p underwent a
compositional change from bronze to plated steel in 1992. However, both
coins remain valid back to 1971, the only circulating coins valid on Decimal
Day still to be valid. In 1982, the word "new" in "new penny"
or "new pence" was removed from the inscriptions on coins, to be replaced by
the number of pence in the denomination. This coincided with the introduction of
a new 20p coin, which, from the outset, simply bore the legend "twenty pence".
A £1 coin was introduced in 1983, and a £2 coin in 1997.
Ireland When the old pounds, shillings, and
pence system was in operation, the United Kingdom and Ireland operated
within the Sterling Area, effectively a single monetary area. The Irish pound
had come into existence as a separate currency in 1927, but the terms of the
Irish Currency Act obliged the Irish currency commissioners to redeem Irish
pounds on a fixed 1:1 basis, and so day-to-day banking operations continued
exactly as they had been before the creation of the Irish Pound.
This state of affairs continued until 1979 when Irish obligations to the
European Monetary System forced them to break the historic link with Sterling.
In Ireland, all pre-decimal coins, except the 1s, 2s and 10s coins, were
called in during the initial process between 1969 to 1972; the ten shilling
coin, which, as recently issued and in any event equivalent to 50p, was
permitted to remain outstanding. The 1s and 2s were recalled in 1993 and 1994
respectively. Pre-decimal Irish coins may still be redeemed at their face
value equivalent in euro at the Central Bank in Dublin.
Pre-decimal Irish coins and stamps' values were denoted with Irish language
abbreviations and pingin) rather than abbreviations derived from the Latin
solidi and denarii used in other Sterling countries. Irish people and
business otherwise used "£sd" just as in other countries. Thus prior to
decimalisation coins were marked '1p', '3p' etc. rather '1d' and '3d' as in
Britain. Low-value Irish postage stamps likewise used 'p' rather than 'd'; so a
two-penny stamp was marked '2p' in Ireland rather than '2d' as in the UK.
After decimalisation, while British stamps switched from 'd' to 'p', Irish
stamps printed the number with no accompanying letter; so a stamp worth 2
new pence was marked '2p' in the UK and simply '2' in Ireland.
See also Banknotes of the pound sterling
Introduction of the euro References and sources
References Sources
The Royal Mint, All Change: 25th Anniversary of Decimal Currency in
Britain External links
Decimal Currency — The System a public information film produced to educate the
public about the new system Committee of the Inquiry on Decimal
Currency: report D Day delivers new UK currency
Britain to go decimal in 1971 Decimalisation
The History Files: Decimalisation in the UK.
Musical satirist Tom Lehrer singing a song about plans for the decimalisation
of the UK's currency on the David Frost Report.