Eurozone Cash for Charity

Cambridge 2000 memos

June 2001

The Eurozone is converting to Euros in January 2002. There will be a six month dual currency period, but after that Euros will be the only acceptable currency in the Eurozone countries. Many UK citizens have small amounts of the soon-to-be-obsolete currencies, left over as change from trips to Europe over the years. It is hardly worth any individual converting this money at banks because the bank charges would be a high proportion of the amount converted. The UK government should coordinate with the UK banks to collect this money as charitible donations from the citizens concerned, and then convert it en masse and re-distribute the proceeds to a selected group of charities. It is possible that more than 100 million pounds could be raised for charity. This idea could also be followed in other European states, thus creating a positive pan-European action driven by the people, rather than by governments and their bureaucrats.

One of the reasons the banks charge commission for converting currency is the amount of work involved, principally the time involved by bank staff to do the transaction. As part of this charitible exercise the banks should donate their time to collect the money, and to coordinate the mass conversion. In order to avoid excessive cost the donations should not be individually recorded but just put into collection boxes. This will still leave some effort, e.g. to separate the currencies from the various countries. And inevitably some people will donate currency which is already obsolete. So this is a non-trivial exercise, but if the scheme is well-organised the cost to banks should be minimal. The banks could also help with marketing the idea by providing advertisements on TV. This would also cost money but is something which paints the banks in a positive light and promotes them in any case, so is effectively cost-free.

A number of worthy charities should be identified and the proceeds split between them in some proportion. Individuals donating the money might like to specify one of the chosen charities individually. However, this complicates the donation process, even if every donor was given one vote independent of the amount donated, so this should probably be avoided. In the UK the money could just be given to the Lottery Board to hand out. Or specific European-related objectives could be targetted (although this is perhaps dangerous given the Eurosceptic nature of many British people). For example, money could be used to send British school children to Europe to learn a second language. Or the money could be used to reduce debt of third-world countries. There are plenty of worthy charities. The main objective should be to identify causes with which a large number of British (and European) people can identify.

Of course many people have no Eurozone cash at home, and some who do will probably not be able to find it. But if the average UK household has just ten pounds (on average) in Eurozone currencies, and half of them donate this money to this scheme, then that would raise over 100 million pounds. Of course if that ten pounds is really only one pound, then that would raise only just over 10 million pounds, which is still good but not so exciting, and perhaps not worth all the effort involved. Spreading this across Europe would multiply the numbers by perhaps five or more.

Cambridge 2000 memos