The history of coins in New Zealand
By Reserve Bank of New Zealand | Monday, 1 February 2016
The early years
In early 1840, Captain William Hobson, RN, the first Governor of New Zealand, extended British laws to New Zealand. This meant that certain sections of the Imperial Coinage Act, 1816 (UK) became relevant to the new colony. This allowed for the standard gold, silver and bronze British coins to circulate freely in New Zealand alongside the existing variety of foreign coins. British coins were made legal tender in terms of the above act by the passing of the English Laws Act in 1858.
In the 1840s and 1850s there was an extreme shortage of coins, especially copper coins. Traders tried the issue of low value paper notes to remedy this situation but this was soon abandoned. Instead, as this shortage intensified throughout the 1850s, businesses in Auckland and Dunedin decided to issue their first copper tokens in 1857. In all, 48 traders (mostly retailers) issued their own penny and half-penny tokens. This practice survived until 1881 with their use gradually declining in the 1880s.
In 1897, New Zealand's currency became subject to certain provisions stated in the Imperial Coinage Act, 1870 (UK). This meant that only British coin became the official legal tender coin of the colony. At that time, it was already one of the two common currencies, along with Australian minted gold sovereign and half sovereign coins.
In 1914, the gradual withdrawal of gold coin from circulation took place.
Silver coin was debased from .925 fine (Sterling Silver) to .500 fine in 1920.
New Zealand introduces its own currency
By 1933, it was obvious that something had to be done about the coin smuggling and the shortage of lower denomination coins in New Zealand. It was decided that New Zealand should start issuing currency from a single bank. The New Zealand Numismatic Society suggested that New Zealand adopt a decimal system of coinage.
However a distinctive New Zealand coinage was introduced in 1933 based on a fractional system (the same as sterling). These new coins used the same weights, sizes and denominations as the British coins. Bronze coins (penny and halfpenny) of British standard were not approved until 22nd December 1939. These were issued in 1940, at the time of the Centennial of New Zealand.
The Coinage Act, 1933 governed the currency, coinage and legal tender in New Zealand, and meant that British coin ceased to be legal tender as at 1st February 1935. New Zealand then became the last and most remote of the self-governing dominions of the British Commonwealth to introduce its own coinage.
In 1947 the issue of cupronickel coins replaced .500 fine silver coins. This proclamation was made under Section eight of the Coinage Act, 1933 and signed on 25th August 1947. Both metal types of coins were still considered to be legal tender. This change was due to the rising costs of mining and the price of silver.
Introduction of Decimal Currency
Decimal currency was introduced to New Zealand on 10 July 1967. A great deal of work was required to make the change from Imperial currency, including a huge publicity campaign. A series of advertisements on television introduced the concepts to viewers in New Zealand.
In 1959, a committee was set up to study and report on decimal coinage. This committee was in favour of such an adoption, and after further study, it was announced in 1963 that New Zealand would change to a decimal coinage system.
In 1964, the Decimal Currency Act, 1964 prescribed the designs, diameters, and standard weights of the decimal coins, which first appeared in circulation on 10th July 1967. These coins were all designed by Reginald George James Berry (known as James) of Wellington. His initials (JB) appear on the reverse of all of our then bronze and cupronickel coins.
The word Shilling was included on the 10 cent coin to assist with the transition to decimal currency, it featured on minting of the 10c coin for the years 1967, 1968 and 1969 and was dropped in 1970. The 1968 10 cent coin minting were for collectors sets only.
The coins introduced were the 1c, 2c, 5c, 10c, 20c and 50c coins.
Now it can be told
This footage tells the story of the distribution of currency for decimalisation on 10 July 1967. $120m of currency, weighing 730 tonnes was sent to nearly 600 bank branches around the country by plane, ferry, truck and train between April and June 1967 as part of Operation Overlander. Everything went without a hitch and not one cent was lost!
The introduction of decimal currency to New Zealand
On the 31st March 1989, the issue of 1 and 2 cent pieces ceased. Both coins were demonetised on the 30th April 1990.
In December 1990, a new 20 cent piece was introduced to replace the old 20 cent piece, as the Kiwi design on the old 20 cent piece was transferred to the new $1 coin. Both designs of the 20 cent coin are legal tender along with the earlier two shilling piece or florin.
On the 11th February 1991, new $1 and $2 coins were introduced to replace the $1 and $2 notes.These two coins and above 20 cent coin were all designed by Robert Maurice Conly, M.B.E. of Wellington.
On the 31st July 2006, the Reserve Bank introduced new smaller and lighter 10, 20 and 50 cent coins made of plated steel. The Bank started withdrawing the corresponding old silver-coloured cupronickel coins at the same time. The 5 cent coin was withdrawn and not replaced. The main reason is that over the years inflation reduced the value of the five cent coin so much that it became a nuisance and of no real value to people making transactions. The old coins were demonetised, i.e. declared no longer legal tender, with effect from 1 November 2006.