25 September 2023

Mint cashes in on unpopular coins

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An audit of the Royal Australian Mint’s strategies for overcoming the community’s declining demand for coins has found them to be mainly appropriate and effective.

In his report Strategies for Addressing the Impacts of Declining Demand for Australian Circulating Coins, Auditor-General Grant Hehir found that while the Mint’s other commercial activities had increased 58 per cent in two years, they did not yet fill the gap created by the drop in income from minting coins.

“The Mint has developed and implemented strategies for addressing the impacts of declining demand for Australian circulating coins that are mainly appropriate and effective,” Mr Hehir said.

“The Mint is yet to achieve its strategic objective of filling the seigniorage gap through growing its commercial business.”

He explained that seigniorage was the difference between the sale price of a circulating coin and the cost to produce and distribute it into circulation.

“The current financial arrangements do not facilitate the return of the Mint’s commercial profits to the Australian Government to support the achievement of the Mint’s strategic goal,” Mr Hehir said.

He noted that the Mint had expanded its commercial business activities and generated growth in commercial revenue and profit.

Commercial revenue had increased from $52.9 million in 2015-16 to $83.7 million in 2017-18, which represented 58 per cent growth over two years.

The Auditor noted that the Mint’s current financial arrangements did not facilitate the return of its commercial profits to the Government to support the achievement of its strategic goal.

“If the Mint continues to strongly grow its commercial activities and revenues, consideration needs to be given to the appropriateness of its current status as a non-corporate Commonwealth entity,” Mr Hehir said.

The Auditor-General’s 43-page report can be accessed at this PS News link and the audit team was Esther Barnes, Veronica Clement‐Jones and Andrew Morris.

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