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Pound Coin Consultation
Debt and Reserves Management Team
HM Treasury
1 Horse Guards Road
London SW1A 2HQ
21 November 2014
Dear Sir/Madam,
Specification of the new £1 coin: a technical consultation
The British Parking Association (BPA) welcomes your consultation on the ‘Specification of the
new £1 coin’ and is pleased to set out below the Association’s response.
The specification
1. Do you have any views in relation to the four key security features proposed at Budget
2014 (12-sided, bi-metallic, bi-colour and The Royal Mint’s new anti-counterfeiting
technology)?
There is usually a preference for coins with an odd number of sides because these are proven
to roll a lot more smoothly without bouncing, causing less damage to the equipment. However,
the BPA and its members have been informed by The Royal Mint that, following comprehensive
tests in automatic vending and parking payment machines, the 12-sided coin works 100%
successfully.
In terms of safety features and validating the new coins, there are a number of things to
consider. For instance, existing parking machines validate coins through weight, shape and size
alone; some modern machines are also capable of providing a ‘metallic signature’ based on its
alloy composition, but there are currently no parking machines in the UK that can optically
detect bi-colour, bi-metallic coins. In effect, this means that the current technologies are not
even taking advantage of the ‘physical’ security features in the existing £2 coin. We believe that
manufacturers of validators, should be encouraged to embrace these new security features as
well as the emerging technologies, but this will require investment and time to come to fruition.
There are also concerns that The Royal Mint’s iSIS technology may present problems for
authenticating the coins. As we understand it, the new £1 coins will be embedded with
luminescent particles that do not wear over time, giving the coin, with its combined security
features, a circulation period of 30 years. Over time, coins gather dirt and the question was
raised about whether this build up of dirt will generate problems for machines reading the coins.
It was also felt that any new technology based on optical sensing detection will be subject to
normal dust build-up on the machines and this would have an effect on possible accuracy as
well as an increase on maintenance costs.
A potential legal issue was identified, too, regarding the use of iSIS technology. It was posed
that, should a counterfeit coin be identified as such, it would be necessary for the parking
machine to retain the coin. If machines are required to retain the coin without giving value for it
then, understandably, this would upset the motorist who would be of the opinion that they had
paid for their parking. Presently, parking payment machines simply reject coins that are not
recognised or cannot be validated. It may be that this continues. This does, however, leave
counterfeit coins still in circulation: a situation not unlike today.
2. (a) Is there a point within the specified diameter range which you consider to be
optimal?
Existing parking machines include coin safes and coin recycling hoppers to store coins, and the
capacity of these is important if they are to continue to work effectively and efficiently. Reduced
capacity may require more frequent replenishment if the supply of coins expires. Ideally, the
new £1 coin should not be larger than the existing £1 coin because this would reduce the
capacity for coins to be stored in the safe and/or hoppers.
(b) Is there a point outside of the diameter specified range which you feel ought to be
considered?
Ideally, the new £1 coin should be physically unique; not be identical or similar in size to any
existing or non-UK coins, tokens or other similar objects.
3. (a) Do you have any views on the government’s preference for a nickel-brass outer and
nickel-plated steel inner, or on the alternative composition specified?
As above, if the nickel-plated steel inner is heavier than the nickel-plated alloy inner, this will
impact on wear and tear of the internal coin mechanism.
Additionally, the metallic composition of the current £1 coin makes it prone to damage along its
edges causing it to become jammed in the chute of machines. We would like to see this
problem minimised in the design of the new £1 coin.
(b) Is there a metallic composition other than that proposed which you feel ought to be
considered?
No.
4. Do you have any views on the relative merits of sharp or rounded corners?
There is a strong preference for rounded corners on the coin as sharp corners, as shown on the
sample, can, over time, cause damage to parking machines. Rounded corners will also assist
the transit of the coin through coin validation systems.
5. Do you have a view on which feature of the thickness and weight of the coin should be
specifically determined and, if so, what measurement should this take?
Weight is a factor that needs to be given due consideration. Ideally, the new £1 coin should be
less or equal to the weight of the existing coin. Parking machines have to be emptied regularly,
which means that parking attendants have to carry around a large quantity of coins. For
purposes of health and safety, weight should, therefore, be a primary factor when determining
the exact specification of the new coin. It is our recommendation that the coin be as small and
light as is practicably possible; very light coins can be problematic as mechanisms struggle to
detect them and, as a result, these coins are more likely to be rejected. Very heavy coins create
added wear and tear for coin mechanisms.
The thickness of the coin is also an important consideration because the thicker the coin, the
larger the slot needs to be and the greater the chance of foreign objects becoming lodged in the
opening.
Transition effects
6. (a) Would you like to comment on any of the identified transition effects associated
with introducing a new and highly secure £1 coin?
There are currently around 80,000 parking machines in operation across the UK. Of these
80,000 machines, 10,000 dispense change and, consequently, coin sorting in these machines
will present a problem during the six-month period of co-circulation. For example, payment
machines typically have four coin hoppers for recycling of coins: in £1, 50p, 20p and 10p
denominations. The need to include two distinct coin hoppers for each version of the £1 coin
means that one of the other three will need to be temporarily dispensed with. This may create
difficulties in giving change resulting in the need to review tariffs to ensure that appropriate
change can continue to be given.
We are also conscious that the complexity of the designs intended to prevent counterfeiting may
increase the burden on the parking industry in adapting payment machines accordingly,
ultimately increasing costs for the customer.
It is anticipated that the majority of the parking profession will carry out the most basic upgrade
possible on existing equipment; any new equipment will, over time, carry these added security
features as and when the technology is available. Experience shows that many parking
payment machines have a street life of up to 20 years and in the current economic climate this
is being extended. Potentially, it could take 20 years or longer before parking machines are in
place capable of detecting the bi-metallic, bi-colour and iSIS features.
It is important that the parking profession is fully consulted on the transitional effects, including
the ability for payment machines to accept two £1 coins concurrently, to minimise disruption for
motorists.
Of paramount importance is recognition of the difference between paying for parking and pure
vending. The inability to pay in a vending machine simply means that the consumer goes
without the product or finds an alternative method to acquire it. The inability to pay for parking
can have serious consequences including penalty charges and confiscation of vehicles.
(b) Are there any other potential transition effects that you feel should be brought to the
government’s attention?
The biggest concern for parking providers is the cost of upgrading equipment which, ultimately,
is a cost that will be passed on to the motorist. It is estimated that the simplest software upgrade
on a pay and display machine will cost in the region of £90 to £130 per machine. If the validator
requires changing, this can often also require new fixing brackets for the new validator and
would cost in the region of £250 to £350 per machine. On machines providing change, it will be
considerably more.
Local authorities are expected to run their parking initiatives in a cost-neutral way and those with
an operating deficit do not necessarily have the resources to invest in equipment upgrades.
Added to this is the problem that a significant number of parking machines are between 10 and
20 years old. Due to age, it is likely that these machines will prove more costly or impossible to
convert.
A concern is that the potential costs involved in converting machines will force parking operators
to look at alternative payment solutions, minimising the need for coins: this will include so-called
cashless payment systems, the deployment of which may be accelerated as a consequence.
Currently, more than 80% of all parking payments use cash and research has shown that the
public are not ready to convert fully to cashless payments, so it would be detrimental to
motorists to see a shift like this. Cashless payment technologies, such as smart phone apps,
call centres, payment cards, like debit cards and credit cards, are not universally available, and
usually concentrated in large urban areas. Interoperability is also an issue given the multiplicity
of service providers for phone payment technologies.
As we understand it, there are plans to make the samples available for industry 18 months
before the coin is introduced into circulation. It is important that this timeframe is adhered to as it
allows suppliers time to finalise development and confirm costs with their customers. Some
operators, particularly local authorities with older equipment or a large quantity of machines,
would prefer to spread the cost over two financial years so, in order for this to happen, prices
must be made available by the suppliers by October 2015 at the very latest.
The government should also be aware that a large number of pay and display machines are
battery operated and the battery is charged by solar panels. It is important, therefore, that the
added security features of the coin do not require an increased level of power consumption on
the new validators as this could be costly for the industry to implement.
(c) Do you have any views on the equalities impacts of the proposals?
We feel that due consideration has been given to the blind and partially sighted to design a coin
that is easily identifiable by its 12-sided, bi-metallic and bi-colour aesthetic. It is important that
the public are made aware of the transition to the new coin, particularly the elderly, and we
support the launch of a public education campaign as a way to do this.
Implementation
7. (a) Do you have any views on the proposed timing of the introduction of the new £1
coin in early 2017?
Early 2017 is preferable. Car parks are subject to high demand during busy trading periods so
timing the introduction of the coin to avoid these will be beneficial to the industry and its
customers.
The Bank of England is also introducing polymer banknotes and some parking payment
machines accept £5 and £10 notes so coordination would be beneficial. Upgrading parking
payment systems can be costly and being able to coordinate, for example, software upgrades
on newer machines would be helpful. Physical changes have their own costs either way but
reducing the number of times a machine has to be upgraded clearly has benefits.
(b) Do you have any views on the expected period of co-circulation with the present £1 of
six months?
It would be our preference to encourage all equipment suppliers and parking operators to carry
out the necessary upgrades in the 12 months prior to the coin being released. However, there
are concerns that cash-strapped local authorities will delay the upgrades to their equipment until
the coins are in circulation, creating a problem for equipment manufacturers, suppliers and
motorists accessing the car parks. This could be damaging to the profession as we all know that
the consequences for not paying for parking can be severe.
Based on the number of parking machines and resources (and experience transitioning the new
ten pence coin), a transition period of 12 months is more realistic and would be preferable
among our members.
This also gives suppliers ample time to visit their customers to de-activate the old £1 coin.
About the BPA - Who we are and what we do:
The British Parking Association (BPA) is the largest professional association in Europe
representing organisations in the parking and traffic management sector. These organisations
are many and varied and include manufacturers, car park operators, local authorities, health
authorities, universities and higher education facilities, airports, railway stations, shopping
centres, theme parks, construction companies, learning providers and consultants.
Currently we have over 710 members, equally split between the public and private sectors. As
the recognised authority within the parking profession, the BPA represents, promotes and
influences the best interests of the parking and traffic management sectors throughout the UK
and Europe. As well as this work, the BPA provides its members with a range of benefits aimed
at helping the professional in their day to day work.
The BPA also manages initiatives for the sector including the Safer Parking Scheme (on behalf
of the Associations of Chief Police Officers), the Approved Operator Scheme (for those
managing and enforcing parking on private, unregulated land) and the Parking Forum.
For more information regarding us here at the BPA, please click here.
I would, of course, be very happy to meet with you in person to discuss any of the above issues
in greater detail.
Yours faithfully,
Patrick Troy
Chief Executive