JULY 10 DOLLARS AND CENTS

Press, Volume CVI, Issue 31362, 6 May 1967, Page 16

JULY 10 DOLLARS AND CENTS

Conversion Table Is Fair, Logical Aid

No-one need be confused about converting pence to cents. With 12d equal to 10c in the forthcoming change to decimal currency, it is only common sense that a table of conversion should be devised. The first thing to remember is that the universal table, which converts whole pence values to whole cent values, is only a guide.

One penny is equal to five-sixths of a cent, 2d is equal to one and two-thirds cents, and so on. Obviously something has to be done to make conversion of pence to cents easier; otherwise there would be hopeless confusion. It was found in South Africa and Australia that a “rounding off’ could be achieved by a system of “overs” and “unders” throughout officially approved tables. And this is Exactly what will be done in New Zealand rounding off pence value to the nearest cent values will mean “overs” and “unders” in new prices charged. If the Decimal Currency Board’s recommended table is used properly—and this is the Important thing—“overs” and I “unders” will offset each other, and we will get the same value for our money as before. What guarantee have we that the officially approved

table to balance things out will be used by shopkeepers and businesses? The New Zealand Retailers’ and Master Grocers’ federations—and this covers a great many shops throughout the country—have already clearly indicated that their members will apply the conversion tables fairly. And the same promise has been given by leading chain stores. The Decimal Currency Board says no inflation is expected because of the change nor because of the “over and under” conversion suggested. It says no profiteering is expected; nor will it be worthwhile. South African and Australian experience was that no inflation occurred, says the board. Competition corrected any such tendency, chain stores setting the trend, just as they do now. Some small businesses made incorrect conversions, through misunderstanding, it was reported, but corrected these quickly in the face of lost goodwill and lost trade. There have also been re-

peated assurances from the Government which has made it clear it will not tolerate any form of profiteering. It has said it expects total revenue and expenditure can and will remain constant. One of the surest tests of whether conversion to decimal currency acts to the detriment of the people is to take a look at the cost of living both before and after the changeover. The Australian Consumers’ Price Index showed no unusual change in the March, 1966, quarter after the change there. In fact the March quarter showed a two-point increase, compared with nine points in March, 1965, and eight points in March, 1964. “The fact is,” says the Decimal Currency Board, “that prices in Australia were more stable than usual over the change-over period. We expect the same here. Normal competition and the sensitivity of customers will have a real effect if prices are not properly converted.” Auckland Leaflet Where does this leave us in relation to opinions in the protest leaflet that was distributed recently around Auckland. The pamphlet said it was designed to draw public attention to the fact that the alleged advantages of decimal currency were an insidiously contrived facade for the actual motivating factors of the change. It alleged that depreciation was inevitable because of the projected one shilling to 10 cent conversion. It went on to charge the Government with “adroitly concealing the fact” that, after the change, the cent would be equal in value to the existing penny, not, as was obviously mathematically required, equal to I.Z times the penny. First, whatever is meant by "depreciation” does not really matter so long as the amount of money we have has the same purchasing power, and that we don’t lose on the deal. And,- in any case, the conversion of prices is all-important