A penny saved is a penny earned- A ‘change’ for the Canadian Economy.

Thursday March 29th 2012- The budget announcement by finance minister Jim Flaherty, announced changes that are being brought forward by the Canadian government. One of the major changes in the 2012 budget has to do with the irradiation of the penny.

The debate about eliminating the penny has been going on through decades. Pennies have been circulating in the Canadian system for the past 104 years costing the Canadian government close to $130 million to keep the circulation going. Finally the government has decided to phase out the penny. The machines at the Canadian mint produce pennies that cost them 1.5 cent apiece while the purchasing power of the penny is next to being zero.

Many Canadians think this is just a ‘waste’ that no one likes to carry around and is often left behind as ‘change’ . According to Mr. Flaherty, “ the penny is a currency without any currency” (Hopper, 2012).  Most developed and developing countries have already taken measures to phase out their coin system. The Canadian system has lagged behind in this system of change and is finally taking measures to improve the system.
Most Canadians have stopped using pennies for the lack of purchasing power they carry. Places such as bars, restaurants and parking booths don’t accept pennies as a form of payment. Homeless and poor people who are often seen begging for money don’t even look at the penny as its value has degraded considerably. With the changing times and economic expansion, where the purchasing power of the dollar is going up, pennies are seen as nothing but a waste.

Manitoba MP- Pat Martin on Thursday commented “ Finally, some common sense from government” (Rabson, 2012). Government officials and Canadian people don’t seem to be upset about the penny being eliminated from the system. They in turn think that the government has finally taken steps towards advancement that was long due.

The concern comes forward from the various restaurants and coffee shops owners that would have to re train their staff and re-price all their food and beverages to the nearest nickel rather than pennies. This growing concern of the food and beverage industry in Canada has made this sector ask the government to work closely with them to help ensure that the changes don’t drastically affect this industry.

Are Canadians Happy with the penny being gone?
Most people think that pennies might not be worth a lot of money now, but few years down the lane, pennies will be antique and would be worth a lot of money. For most women who think pennies often make their wallets seem heavier might want to start saving those pennies. Most Canadians are happy about the penny being gone but concerns over what is to come next, often leaves Canadians feeling anxious and confused.

What is to come next?
With the penny being eliminated, people are wondering what is going to be next? Canadians, who have been hit with the harsh budget changes, are left to think what’s in stored for the future. In 2007, Desjardins stated, “ the federal government should consider, a few years later, the relevance of removing the five cent”(Hopper, 2012).  With the many changes that the Canadian government is proposing, the question of what is to come next often lacks a definite answer.

For most Canadians this might not be an issue of concern since they might think that the changes are suppose to be good long term for the economy. For other Canadians such as the baby boomer generation, this might be a sign of a significant change to their values and customs that they have to adapt to since the penny has been part of the Canadian tradition and system for a long time.

The 2012 budget has proposed significant changes and it is up to Canadians how well they respond to such changes. Being a Canadian, the changes do signify some strong promises for the future but how well these ideas will be executed is something we all have to wait and watch.  In relation to the penny being discarded – old fashion tradition of saying – “a penny saved is a penny earned’ won’t be of much significance now.

References:
Hopper, Tristin. “Now the Canadian Penny’s Days Are Numbered, Is the Nickel Next?” National Post. PostMedia Network, 29th Mar. 2012. Web. 29th Mar. 2012. http://news.nationalpost.com/2012/03/29/now-the-canadian-pennys-days-are-numbered-is-the-nickel-next/

Rabson, Mia. “Penny Scrapped, Martin Applauds.” Winnipeg Free Press. 30th Mar. 2012. Web. 30th Mar. 2012. http://www.winnipegfreepress.com/local/penny-scrapped-martin-applauds-145086075.html

Stinson, Scott. “Scott Stinson on Budget 2012: Canadian Penny Fell Victim to Changing Times.” National Post. Postmedia Network, 29th Mar. 2012. Web. 29 Mar. 2012. http://fullcomment.nationalpost.com/2012/03/29/scott-stinson-on-budget-2012-canadian-penny-fell-victim-to-changing-times/

Image: http://www.walletpop.ca/blog/2010/05/08/could-this-be-the-end-of-our-penny/

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