Date Posted:17 December 2015
In February 1959 the Commonwealth Government appointed a Decimal Currency Committee to investigate the advantages and disadvantages of a decimal currency, and, if a decimal currency was favoured, the unit of account and denominations of subsidiary currency most appropriate for Australia, the method of introduction and the cost involved.
The Committee presented its report in August 1960. It recommended the date of introduction of the new system to be the second Monday in February, 1963.
In July 1961 the Commonwealth Government confirmed its support of a decimal currency system, but considered it undesirable to make final decisions on the detailed arrangement that would be necessary to effect the change.
On 7 April 1963 the Commonwealth Government announced that a system of decimal currency was to be introduced into Australia at the earliest practicable date, and gave February 1966, as the tentative change-over date.
On 14 February 1966, a decimal currency, the dollar of one hundred cents, was introduced.
Under the implementation conversion rate, £1 was set as the equivalent of $2. Thus, 10s became $1 and 1s became 10c. The conversion rate 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, with one penny becoming one cent; however, the Government thought it more important that the new currency unit be more valuable than the United States which it would not have been under a 2.4:1 ratio.