![]() The $5, $10, $20, $50 and $100 notes made by Note Printing Australia for the Reserve Bank have an astronomical markup. This means the government makes tens of millions per year replacing – at a huge markup – things we have lost.Īnd it’s just the beginning. Most of the coins that we provide are against coins that disappear down the back of chairs, down the back of car seats, into rubbish dumps and, in some cases, are taken overseas.Īsked whether he was seriously suggesting a hundred million or so coins per year disappear, MacDiarmid replied he was. Merely replacing coins as they get worn out doesn’t earn seigniorage.īut a previous head of the Mint, Ross MacDiarmid, let the cat out of the bag in 2014 when he told a Senate committee: Surely we’ve got just about all the coins we need. That the government can keep making money from seigniorage appears to defy common sense. This financial year the government expects A$59 million, next year $67 million. The paradox of going contactless is we're more in love with cash than ever It’s called “ seigniorage”, an ancient French word that refers to the profit only a seignior (feudal lord) can make from the exclusive right to mint coins. The profit – the huge markup – goes straight to the Commonwealth budget as non-taxation revenue, tens of millions per year. Usually it costs the Mint far less to make each coin than each one becomes worth the moment it is sold to a bank (before metal prices climbed, it cost the mint about 20 cents to make a $2 coin, and about 15 cents to make a 50 cent coin). The Mint makes an extraordinary 120 million to 140 million coins per year (even more, as much as 175 million when Australians stocked up on cash during the first year of COVID), and it is a money-making operation in more ways than one. (And yes, he noted “for the avoidance of doubt, for any conspiracy theorists out there, all coins bearing the face of Queen Elizabeth II will remain legal tender”.) Briefly, in the days after the death of the queen, we were afforded a glimpse into the machine that makes Australia’s money.Īssistant Treasury Minister Andrew Leigh turned up at the Royal Australian Mint to explain the process by which a portrait of the King Charles will replace the portrait of the queen on the heads-side of coins minted from 2023.
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