Peter Barry
Ceist:13 Mr. Barry asked the Minister for Finance if he will consider issuing a new two-pound bank note.
Ceisteanna — Questions. Oral Answers. - Issue of Currency.
The issue of the currency is a matter for the Central Bank. The bank informs me that it has no proposals to issue a note of this denomination.
(Limerick East): I would like the Minister to take this suggestion on board as a serious one. The new pound coin is not very popular and has not really worked well. People are going around with pockets full of these coins. I think it is reasonable that there should be a note of a smaller denomination than the £5 note.
It is very good in the national collection.
(Limerick East): It is also inflationary. If you give any child less than a pound coin you are in trouble. A note of a smaller denomination than the £5 note is now required, and I would ask the Minister to take this up with the Central Bank as a serious suggestion.
I accept what the Deputy is saying. There is mixed reaction to the pound coin. The complaint of confusion with the 10p coin is the most common one that I hear about and that the Central Bank receive most calls about. The Central Bank plans to introduce smaller and the lighter 5p, 10p and 50p coins. That is their next programme. They are going to give priority to the 10p coin as the one which is causing the most trouble in relation to the one pound coin. Their plan was to go ahead with the alternation of the 50p coin first but that is not creating any problem. It is heavy and is distinctively different from the others. Therefore, the 10p coin will now get precedence over it.
There also have been some complaints in that the one pound coin is the same size as the old pre-decimal penny, and that large quantities of these coins have been used in some vending machines. The bank assured the Department earlier this year, before we issued the coin, that following discussions with manufacturers of vending machines it was possible to distinguish electronically between the one pound coin and the old one penny coin on the basis of metal composition and, in some cases, design. However, there appears to be a problem with certain old machines and this is being investigated by the Central Bank. The Department have asked the bank to work closely with the trade bodies to advise on conversion of machines and, where possible, to withdraw such old penny coins as show up in those old machines.
There also have been some reports in the media of alleged one pound counterfeit coins but these have so far proved to be false. In the UK Royal Mint less than a dozen defective coins out of a total of 40 million have so far come to notice. The Central Bank is in contact with the Royal Mint to ensure more adequate quality control. The objective it to clear up those matters first. There is no perceptive demand for a £2 note. Priority will be given to the 10p coin which is causing the most problems with the new one pound coin.
(Limerick East): There are circumstances where you take a taxi and the driver does not have a £5 note, therefore you end up with six or seven pound coins stuffed into your pocket. People are carrying around a lot of coinage at the moment and that is inconvenient. There is a strong case to be made for a note of a lower denomination than the £5 note. Five pounds is a sizeable amount of money and it should be possible to have a note of a lower denomination. The Minister should take up this suggestion. I know it would cost more to issue notes rather than coins because they do not last very long, and I know there is a reluctance on the part of the Central Bank and the Department to restore notes. They have been trying to remove notes from circulation for quite some time. As I have said, there is a case to be made for a note along the lines suggested by Deputy Barry.
Certainly the Deputy is right in saying that the Department are reluctant to issue notes because of the cost involved. The Central Bank has to bear the full cost of issuing notes, which would be very high. We will certainly reconsider the whole matter but I am not giving a commitment to the Deputy or the House that we will issue a two pound note. There are arguments for and against it. It is true that with the introduction of any new coinage there are certain teething problems and it takes a while to get used to them. You do not have to give a pound to every child — there are 50p, 10p and all sorts of coins. Deputy Noonan told us one time in the House that the condition of our notes was disgraceful and that they should not be used. He was absolutely right and we were glad to get away from the £1 notes. They were very expensive to issue and they did not last very long. Let us give the one pound coin another chance and see how we get on.
(Limerick East): It is very good for church gate collections.
It increases your collection from 50p to a pound and you should not be complaining about that.