From coins to cons, Marc Zakian looks at the history of British Money.
ANY OLD IRON
Britons made money before they made writing. Our mysterious tribal ancestors the Celts left no written documents, but Albion’s Iron Age rulers busily minted the country’s first coinage. The Atrebates were a powerful Celtic force. From their stronghold in ancient Silchester they struck gold coins, stamping them with the image of a horse – maybe inspired by the great white beasts hewn into the chalky landscape at Ridgeway, Uffington and Westbury.
Over 45,000 coins survive from Iron Age Britain, minted by tribes from Devon to Derbyshire. The Celts were certainly skilled coin makers, but how they used their money remains a mystery.
POUNDING THE STREETS
The Romans developed the original euro. A denarius paid to a soldier at Hadrian’s Wall could be used to pay for his lunch in Rome and dinner in Athens. Britain’s first mint opened in Roman London in AD 286, making three types of coin: gold (aureus), silver (denarius) and brass (sestertius). Our modern £ symbol derives from an ornate version of the Roman L in Libra Pondo, while the ‘d’ in the pre 1971 Lsd (pounds shillings and pence) was derived from denarius.
The Rome mint was named after the god Juno Monet, giving us the term ‘money, while ‘coin’ derives from the Roman ‘consecratio’ – money issued by the Emperor to honour a deceased family member.
IN FOR A PENNY
When the Anglo-Saxons conquered Britain, money disappeared for two centuries. The first English currency was minted in the 620s. Inscribed with a scrambled imitation of Roman writing, our medieval ancestors carried coins covered in nonsense. The Anglo-Saxons gave us the first shilling – made of gold – and in 675 started minting silver penings, England’s first penny. This denomination has survived for 1,300 years.
With twelve to a shilling, the penny represented a day’s pay for a skilled worker. There was no small coinage and change was given by cutting the penny in two to create ha’pennies, or into four making farthings. Very small transactions were bartered. The pound was born in AD 775. 240 silver pennies made up one pound in weight. This was a vast fortune in the 8th century, and there would be 800 years of inflation until a pound coin was finally minted. In 928 Athelstan, the first King of all England, declared the pound the first national coinage. Today the British pound is the oldest currency in the world.
MAKING A MINT
The Normans changed almost everything in England, except the currency. Anglo-Saxon money was so efficient that William the Conqueror simply swapped the coin-portrait of the old king for his own so everyone knew who was in charge. Norman England saw the first mention of ‘sterling’. The word may have derived from the stars or starlings –both of which appeared on pennies – or from the Germanic ‘ster’, referring to the pure quality of the silver. Coins were struck at Royal mints by ‘moneyers’. One moneyer placed a handmade piece of flat metal between two engraved stamps called dies, then a second worker struck it with a hammer.
Busy workshops would stamp out more than 2,000 blanks a day. This was hot, dangerous work and moneyers regularly lost fingers and eyes. Cheats thrived. Coin clippers would shave off gold and silver slivers to melt down into new coins, while mint workers would try and steal precious metals. With fraud threatening to undermine the currency, in 1124 King Henry I summoned all the moneyers to the Assize at Winchester – then the capital of England – where 94 mint workers were castrated for producing bad coins. Edward I moved the mint to the Tower of London and introduced regular checks. The master moneyer would save one coin from each ten pounds minted and every three months present them at the Trial of the Pyx. This ceremony was presided over by a judge and a jury of assayers. In medieval times this took place at the Palace of Westminster – today it is held at the Goldsmiths’ Hall in the City of London.
During the 17th century, the lack of low-value coins developed into a crisis. Exasperated shopkeepers started making and distributing their own branded tokens, handing them to customers as small change. These could only be spent at the shop that issued them. By 1612 there were hundreds of shops and 3,000 unlicensed mints churning out low-value tokens. In 1672, the Royal Mint finally responded by minting copper pennies. The penny heralded the first appearance of that great patriotic icon, Britannia. The diarist Samuel Pepys claimed that the symbol of British money was modelled on the Duchess of Richmond – who famously refused to become King Charles II’s mistress.
In 1696 the office of Warden and, subsequently, Master of the Mint was awarded to an unlikely candidate, Isaac Newton. The father of modern physics, creator of the theory of gravity and inventor of calculus took over the comparatively mundane task of overseeing the currency. The £500 a year salary was incentive enough for Newton, who was born on a farm and had to work his way through the University of Cambridge.
Newton supervised important changes to the quality and safety of the coinage. But the intriguing part of this story was his sleuthing. He estimated that 20 per cent of the coins in use in 1696 were fake, and the great man spent much of his time investigating forgery – a treasonable offence, punishable by being hanged, drawn and quartered.
Disguised as a habitué of bars and taverns, Newton gathered evidence against the fakers. His arch nemesis was William Chaloner, an elusive serial counterfeiter and confidence trickster. Chaloner was prolific – he forged guineas, crowns, banknotes and lottery tickets, as well as working as a quack doctor and soothsayer. Newton devoted an entire investigation to Chaloner, using a comprehensive network of spies and informants. Chaloner conducted his own defence at his trial, but Newton’s evidence was overwhelming. Chaloner was hanged on the gallows at Tyburn on 22 March 1699, ‘twitching and writhing for several minutes of the hangman’s dance’. Newton remained as Master until his death in March 1727.
A HIGH NOTE
In 1694 the Bank of England was established. The bank issued notes in exchange for gold and silver deposits. The smallest was £50, over twice the average annual income – most people went through life without ever touching a banknote. In 1797 war with France led to a shortage of gold and silver. Panic spread. People rushed to swap their notes for coins and the bank vaults were emptying fast. Most of the silver stored at the Bank of England was Spanish silver reales, known as dollars. To avert a crisis, the bank transformed them into English currency by punching a small image of King George III on top of the portrait of the Spanish king.
The run on the bank was satirised by Gillray in a cartoon titled‘the Old Lady of Threadneedle Street in Danger’. It shows the bank as an elderly woman sitting on a strong box with prime minister Pitt attempting to get at the contents. The name stuck, and to this day the Bank of England is known as The Old Lady of Threadneedle Street.
Within a year of the Bank of England opening, its first trickster was apprehended. Daniel Perrismore forged 60 £100 notes – around half a million pounds in today’s money.
The Bank of England stores 400,000 gold bars in its vaults, each worth around £400,000.
While the rest of the world went metric, Britain stubbornly hung on to its pounds, shillings and pence. With 12 pennies to a shilling and 240 pennies to a pound, generations of school children had the 12 times table drummed into them so they could check their change at the sweet shop.
Coins still in circulation five decades ago bore names that were more Shakespearean than space age. In 1971 most of these historic names were swept away as Britain finally went decimal. There were two survivors – the penny and the pound. When the pound switched from notes to metal in 1983, the forgers set to work – of the 1.5 billion in circulation, about one in thirty £1 coins was counterfeit. In 2017 the new bi-metal pound made it harder to copy. And now the penny, that clink of an Anglo-Saxon England history in our pockets, is under threat. Today over half of 1p coins are used only once, before being either thrown away or stuck in a jar, while the price of the metal in pennies is almost the same as their face value.
Penny wise? Perhaps not, but with electronic payments now the norm, over a thousand years of British cash may be about to be cashed in.
Find out more about the history of money on a guided tour:
Take a Blue Badge Guided tour of the British Museum, including one of the world’s finest numismatic collections, with over one million objects. Or how about a visit to The Bank of England Museum in London or The Royal Mint Experience, in South Wales, the only place in the world where you can watch the United Kingdom’s coins being made.