Phasing-out of one and two-cent coins (A/Min)

One and two-cent coins will begin to disappear from circulation this Saturday, Acting Consumer Affairs Minister Judyth Watson said today.

"The Reserve Bank will stop issuing the copper coins from February 1, and will begin to collect them," Dr Watson said.

"Western Australians need to be aware that the coins will remain legal tender, and can still be exchanged for their face value, though it is likely that they will disappear rapidly from circulation.

"Retailers and other businesses should follow the guidelines set by the Federal Treasury when they round prices up and down.

"The cent will remain the basic unit of account, and goods and services will still be able to be priced in multiples of one cent.

"In transactions where one and two-cent coins are unavailable, businesses should round total prices to the nearest 10 or five-cent mark."

Dr Watson said rounding was not necessary when transactions were made by cheque, credit card or by electronic funds transfer (EFTPOS).

"For this reason, invoiced accounts like electricity and telephone bills should continue to be billed to the exact cent," she said.

"The Prices Surveillance Authority will be monitoring the way the rounding guidelines are applied so there are no unwarranted price increases."

Last July, Consumer Affairs Minister Yvonne Henderson called on the then Federal Treasurer, John Kerin, to set a date for one and two-cent pieces to cease to be legal tender.

Mrs Henderson said that without a time frame for the complete phasing-out of copper coins, confusion would continue over their use and consumers would continue to be disadvantaged.

The Federal Government stopped minting the coins on October 1, 1990.

Mrs Henderson said she had written to retailers asking them to ensure their staff were familiar with the guidelines and suggesting they obtain signs outlining the guidelines from the Prices Surveillance Authority.