| Australian pound | |||||
|---|---|---|---|---|---|
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| User(s) | Australia | ||||
| Pegged with | British pound at par, and then A£1 = GB 16/- (£0.8) | ||||
| Pegged by | New Guinea pound at par | ||||
| Subunit | |||||
| 1/20 | shilling | ||||
| 1/240 | penny | ||||
| Symbol | £ | ||||
| shilling | s | ||||
| penny | d | ||||
| Plural | |||||
| penny | pence | ||||
| Coins | ½d, 1d, 3d, 6d, 1/-, 2/- | ||||
| Banknotes | |||||
| Freq. used | 10/-, £1, £5, £10 | ||||
| Rarely used | £20, £50, £100, £1000 | ||||
| Central bank | Reserve Bank of Australia | ||||
| This infobox shows the latest status before this currency was rendered obsolete. | |||||
The pound was the currency of Australia from 1910 until 13 February 1966, when it was replaced by the Australian dollar. It was subdivided into 20 shillings, each of 12 pence.
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The history of currency in Australia could be said to begin in 1800, when Governor King issued a proclamation setting the value of a variety of foreign coins in New South Wales. However, because of the shortage of any sort of money, the real currency during the first twenty-five years of settlement was rum, leading to terms such as the "Rum Corps" and the "Rum Rebellion".
Australia's first coinage was issued in 1813 by the colony of New South Wales by punching the middle out of Spanish dollars. This process created two parts: a small coin, which was called the dump in Australia, and a ring, which was called a Holey dollar. One holey dollar was worth five shillings (a quarter of one pound Sterling), and one dump was worth one shilling and three pence (or one quarter of a Holey dollar). This was done in order to keep the coins in New South Wales, as they would be valueless elsewhere.
In 1825, an Imperial order-in-council was issued with the purpose of introducing Sterling coinage to all the British colonies. This was due to the introduction of the gold standard in the UK (1816), and a decline in the supply of Spanish dollars. Most of the dollars used had been minted in Lima, Mexico City, and Potosi, which had become part of new Latin American republics, independent from Spain.
From 1817, when the first bank, the Bank of New South Wales, was established, private banks issued paper money denominated in pounds. In 1852, the Government Assay Office in Adelaide issued gold pound coins. These weighed slightly more than sovereigns. From 1855, the Sydney mint issued half sovereigns and sovereigns, with the Melbourne mint beginning production in 1872. Many of the sovereigns minted in Australia were for use in India as part of a plan that the gold sovereign should become the imperial coin. As it turned out, India was already too entrenched in the Rupee system, and the gold sovereigns obtained by the treasury in India never left the vaults.
Thus, in the lead-up to Federation, the currency used in the Australian colonies consisted of British silver and copper coins, Australian minted gold sovereigns (worth 1 pound) and half sovereigns, locally minted copper trade tokens (suppressed in 1881, some state earlier (Pitt 2000, pp. 10–11)) and private bank notes.
After Federation in 1901, the Australian government assumed the power to issue currency and began overprinting the private issues that were in circulation, in preparation for the issue of a domestic currency. In 1910 the federal government passed the "Australian Notes Act" which prohibited the circulation of State notes. Also passed in that year was the "Bank Notes Tax Act" which imposed a tax of 10% per annum on "all bank notes issued or re-issued by any bank in the Commonwealth after the commencement of this Act, and not redeemed". Both these acts remain on the statute books and perpetuate the prohibition of private currencies in Australia.
In 1910 a national currency was introduced by the Labor Government of Prime Minister Andrew Fisher. The new national currency was called the Australian pound, consisting of 20 shillings, each consisting of 12 pence. Monetary policy ensured that the Australian pound was fixed in value to the pound sterling. As such Australia was on the gold standard so long as Britain was.
In 1914, the pound sterling was removed from the gold standard. When it was returned to the gold standard in 1925, the sudden increase in its value (imposed by the nominal gold price) unleashed crushing deflationary pressures. Both the initial 1914 inflation and the subsequent 1926 deflation had far-reaching economic effects throughout the British Empire, Australia and the world. In 1929, as an emergency measure during the Great Depression, Australia left the gold standard, resulting in a devaluation relative to sterling. A variety of pegs to sterling applied until December 1931, when the government set a rate of 1 Australian pound = 16 shillings sterling (1 pound 5 shillings Australian = 1 pound sterling).
During World War II, the Empire of Japan produced currency notes, some denominated in the Australian pound, for use in Pacific countries intended for occupation. Since Australia was never occupied, the occupation currency was not used there, but it was used in the captured parts of the then-Australian territories of Papua and New Guinea.[1]
In 1949, when the United Kingdom devalued the pound sterling against the US dollar, Australian Prime Minister and Treasurer Ben Chifley followed suit so the Australian pound would not become over-valued in sterling zone countries with which Australia did most of its external trade at the time. As one pound sterling went from US$4.03 to US$2.8, one Australian pound went from US$3.224 to US$2.24.[2]
On 14 February 1966, a decimal currency, the dollar, was introduced after years of planning. 2 February 1963 had been initially planned as the date the new currency would be introduced but this date passed with no fanfare as no progress on developing the new currency had been made at that time. The exchange rate was 1 pound = 2 dollars. Thus, 10 shillings became 1 dollar and 1 shilling became 10 cents.
An exchange rate of $2.00:£1 was problematic for the pre-decimal penny since the shilling was divided into twelve pence. An exchange rate of $2.40:£1 would have allowed for accurate conversion down to the penny, however the Government thought it more important that the new currency unit be more valuable than the United States dollar which it would not have been under a 2.4:1 ratio. Amounts less than a shilling were converted thus:
| Pence | Accurate conversion | Actual conversion | Pence | Accurate conversion | Actual conversion | |
|---|---|---|---|---|---|---|
| ½d | 5⁄12c | 0.417c | 6½d | 55⁄12c | 5c | |
| 1d | ⅚c | 0.83c | 7d | 5⅚c | 6c | |
| 1½d | 1¼c | 1.25c | 7½d | 6¼c | 6c | |
| 2d | 1⅔c | 2c | 8d | 6⅔c | 7c | |
| 2½d | 2⅟12c | 2c | 8½d | 7⅟12c | 7c | |
| 3d | 2½c | 2c | 9d | 7½c | 8c | |
| 3½d | 211⁄12c | 3c | 9½d | 711⁄12c | 8c | |
| 4d | 3⅓c | 3c | 10d | 8⅓c | 8c | |
| 4½d | 3¾c | 4c | 10½d | 8¾c | 9c | |
| 5d | 4⅙c | 4c | 11d | 9⅙c | 9c | |
| 5½d | 47⁄12c | 5c | 11½d | 97⁄12c | 9c | |
| 6d | 5c | 5c | 12d | 1 s = 10c | 1 s = 10c |
In 1855, gold ½ and 1 sovereigns were first minted by the Sydney mint. These coins were the only denominations issued by the Australian mints until after Federation.
In 1910, .925 fineness sterling silver coins in denominations of 3 and 6 pence, 1 and 2 shillings (florin). Unlike in the United Kingdom, no half crowns were issued. Bronze ½ and 1 penny coins followed in 1911. Production of ½ sovereigns ceased in 1916, followed by that of sovereigns in 1931. In 1937 a five shilling piece was issued to commemorate the coronation of King George VI. This coin proved unpopular and was discontinued shortly after being reissued in 1938.
In 1946, the fineness of the silver coins was reduced to .500 but, unlike New Zealand and the United Kingdom, silver coins continued to be issued until after decimalization.
Numerous private banks issued paper money in Australia, starting with the issues of the Bank of New South Wales in 1817. Acceptance of private bank notes was not made compulsory by legal tender laws but they were widely used and accepted. The Queensland and New South Wales governments also issued notes. The Queensland treasury notes were legal tender in Queensland.
The first national issue of paper money consisted of overprinted notes from fifteen private banks and the Queensland government, issued between 1910-1914 in denominations of 1, 5, 10, 20, 50 and 100 pounds. They were overprinted with the words "Australian note". No 100 pound banknotes of this series are known to exist (Renniks 2000, p. 134)
In 1913 the first national banknotes were introduced in denominations of 10 shillings, 1, 5, and 10 pounds. 1914 saw the introduction of 20, 50, 100, and 1000 pound notes. The 1000 pound note only saw limited circulation and was later confined to inter-bank use. Stocks were destroyed in 1969 and there are no uncancelled examples of this note known to exist in private hands(Renniks 2000, p. 157). There were two types of the never-issued 5 shilling note, one around 1916 and the other 1946 (Renniks 2000, p. 160),[3] both had the reigning monarch and were later destroyed in 1936 and 1953, respectively (Renniks 2000, p. 160).
In the mid-1920s a modified 10 shilling (worded as "Half Sovereign"), and reduced-size 1, 5 and 10 pound notes were issued with the side profile of King George V on the face. These notes still referred to the currency's convertibility to gold on demand. A newer 1000 pound note with the profile of George V was also prepared but never issued. An unissued printer's trial of this note was discovered in London in 1996 and subsequently sold for a sum in excess of 200,000 Australian dollars. Nonetheless, this note is not recognised as a legitimate Australian banknote issue.
Just after the start of the Great Depression in 1933, Australian currency ceased to be redeemable for gold at the previously maintained rate of one gold sovereign for one pound currency. Subsequently a new series of Legal Tender notes were designed, once again bearing the portrait of King George V, in denominations of 10 shillings and 1, 5 and 10 pounds. These denominations and designs were maintained and modified to accommodate the portrait of King George VI in 1938.
The coronation of Queen Elizabeth II in 1953 saw the issue of a new portrait series of prominent persons in Australia's history.
Unissued notes that were printed but never issued for circulation include 2 different 5 shillings, a 1916 with stock destroyed in 1936, and a 1946, stock destroyed in 1953. Both were printed with the reigning king's portrait. Two fifty pound notes were designed, one from 1939 with King George VI and a 1951 as stated above. Both stocks of the £50 note were destroyed in 1958. A 1939 £100 also exist with a brown, green and pink colouration, with stock destroyed in 1958 as well. The last unissued note was a £1,000, with specimens arriving in 1923 and kept till 1928 after a decision not to use the denomination any further. The reserve bank holds specimens of all the stated banknote denominations.[4]
| Preceded by: Pound sterling Ratio: at par |
Currency of Australia 1910 – 1966 |
Succeeded by: Australian dollar Reason: decimalisation Ratio: 2 dollars = 1 pound |
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