Launch of the decimal euro

Fifteen years ago, on 1 January 1999, the euro was introduced as an accounting currency. Notes and coins were introduced three years later. Whilst there are arguments for and against the euro, and UKMA takes no position on this issue, no one challenged at the time that the single currency would be decimal.

There are 100 cents to the euro. Some of the subunits in the currencies that the euro replaced were historical ones that were no longer in use when the euro was introduced. The currencies that the euro replaced were all decimal:

  • 100 Groschen = 1 Austrian Schilling
  • 100 Centimes = 1 Belgian franc
  • 1000 mil = 100 cents = 1 Cypriot pound
  • 100 Pfennige = 1 Deutschmark (German mark)
  • 100 cents = 1 Estonian kroon
  • 100 pennies = 1 Finnish markka
  • 100 centimes = 1 French franc
  • 100 lepta = 1 Greek drachma
  • 100 pence = 1 Irish punt
  • 100 centesimi = 1 Italian lira
  • 100 centimes = 1 Luxembourg franc
  • 100 santimi = 1 Latvian lats (replaced by the euro on 1 January 2014)
  • 100 centimes = 1 Monegasque franc (was used in Monaco)
  • 1000 mils = 100 cents = 1 Maltese lira
  • 100 cents = 1 Dutch guilder
  • 100 centavos = 1 Portuguese escudo
  • 100 stotinov = 1 Slovenian tolar
  • 100 haliers = 1 Slovak koruna
  • 100 centimos = 1 Spanish peseta
  • 100 centesimi = 1 Sammarinese lira (was used in San Marino)
  • 100 centesimi = 1 Vatican lira

You might wonder, what has this got to do with metrication?

A common argument used by defenders of imperial measurements is that binary subdivision, divisibility by three and the use of base 12 are more convenient. They point out that the decimal system uses base 10, which is divisible only by 5 and 2.

However, this argument about using non-decimal bases is not used for currencies, and the benefits of decimal systems for accounting and mathematical purposes has been recognised in the UK at least as far back as the 1862 Report on Weights and Measures. So it is no surprise that decimal currencies are used throughout the world and are normally divided into 100 subunits, and in a few cases 1000 units. Likewise, the metric system offers the same kinds of benefits as decimal currencies and is a world standard that is used by about 95% of the world’s population.

When the US dollar was established in 1792, it was a decimal currency with 100 cents to the dollar, and was one of the first decimal currencies. In the eighteenth century, the youthful USA recognised the benefits of using a decimal currency, so it is ironic that it has been so slow to adopt the metric system and is now one of the few countries in the world that does not have it as its primary measurement system.

The UK was one of the last countries to adopt a decimal currency. Decimalisation did not occur until 1971. The UK formerly used a currency with 12 pence to a shilling and 20 shillings to a pound. Its use of bases 12 and 20 had high levels of divisibility, 12 being divisible by 2, 3, 4, and 6 while 20 is divisible by 2, 4, 5 and 10. However, the pre-decimal currency was cumbersome to use and time had to be spent in schools teaching pupils to do the calculations. For example, what is the total amount of items that cost £1 17s 9d, £2, 14s 7d, £1 13s 10d and £2 8s 4d? It is arithmetically challenging, and furthermore you cannot put these figures directly into a calculator to get the answer. Thankfully, we do not need to work out sums in £sd any longer. We now take it for granted that we can easily work out the total cost of items in decimal pounds and pence by putting the figures into a calculator and getting the answer. It is also easier for us to do mental calculations with decimal currency. Nowadays, all national debate about whether the British should adopt the euro is a debate about which decimal currency to use – there is now no question of Britain going back to a non-decimal currency.

History indicates that the British are sometimes late adopters of new systems, whatever the obvious benefits. But in 1965, a minister gave this reply to a Parliamentary question: “…the Government consider it desirable that British industries on a broadening front should adopt metric units, sector by sector,  until that system can become the primary system of weights and measures for the country as a whole.” Could it be that the country had learned that there is little benefit to coming last? The swift and successful adoption of decimal currency a few years later provided further cause for optimism.

Alas,  although almost fifty years have passed and much has been achieved, there is still a great deal to be done if the UK is to enjoy all the benefits of a single, simple and universal system of measures.

And, by the way, could someone explain, if it is a great idea to have 1760 yards in a mile for UK road traffic signs, then why not 1760 pence in a pound (and 1760 cents in a euro)?

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2 Responses to Launch of the decimal euro

  1. Sven G says:

    BTW, in order for currencies to be an integral part of the SI, at least two things should change (with the following examples made with the euro, but of course also applicable to pounds sterling, various types of dollars, etc. etc.; or even a future worldwide unified currency, who knows…):

    - the unit symbol should be written after the value: e.g., not € 500, but rather 500 €;

    - thousands (SI has its preferred prefixes in the form of 10^ +-3n), rather than hundreds, should ideally be used for small vales (i.e., mils instead of cents): e.g., not 5 (euro)cents, but rather 50 m€ (millieuros); and, of course, SI prefixes also for big values: for example, 50 000 euros would become 50 k€ (kiloeuros), 50 million euros would be 50 M€ (megaeuros), and so on.

    Which isn’t exactly what we are accustomed to; but anyway rather easy to change, *if* there is a real will to do it.

    In other words, try to simplify and unify things as much as practically possible…

  2. Sven G says:

    … I forgot to say that, in the list above, the Italian lira (in its most recent form) actually didn’t have any cents: that was also why the numbers were bigger than most other currencies; see also, for example: http://en.wikipedia.org/wiki/Italian_lira

    Attempts were made to introduce the “heavy lira” (i.e., 1 new lira = 1000 old liras), but nothing happened in practice, and it was only the euro that (re)introduced more “normal” numbers for monetary values.

    (BTW, similarly, talking about the SI, one could – at least theoretically – even think about correcting the error of the kilogram being a derived base unit (i.e., with a prefix, which shouldn’t ideally be the case for a base unit) by introducing the “heavy gram” (so, 1 new gram = 1000 old grams, or 1 (former) kg); anyway, returning to the original “grave” unit, or renaming it “bes” or “gio” have proven unsuccessful: well, maybe with some better name proposal in the future something could eventually change, who knows…)

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