They were supposed to be cleaner, longer lasting and better for the environment, but the Bank of England has admitted that millions of its new plastic fivers and tenners have just been money down the drain.
In an unexpected manifestation of the country’s shrinking economy, officials have acknowledged that during their first three years in circulation, nearly 50m of the new notes wore out and had to be reissued.
The revelation comes after earlier disclosures that some of the “enhanced” security features – including the Queen’s face – could be rubbed off with a pencil eraser, and that the notes could shrink by three-quarters if left in a newly-ironed trouser pocket.
In the latest admission of losing money hand over fist, which is contained within a response to a Freedom of Information request, the Bank said that around 20m polymer £5 notes, which have a portrait of Sir Winston Churchill on the back, have been replaced in the three years since they were introduced.
Another 26m plastic £10 notes have also been replaced since their launch in September 2017.
The scale of the problem is likely to raise further questions about the durability of the new notes – which the Bank had claimed would last two-and-a-half times longer than paper banknotes, and stay cleaner.
It also said the plastic technology would be “stronger” and “improve the quality of banknotes in circulation”.
However, there were reports as early as 2017 that counterfeit notes were in circulation. In the same year, police came across examples that appeared to be missing the foil image of Big Ben, only to be told by the Bank that it had peeled off.
The notes, which are mostly synthetic but contain traces of animal fat, were also said to be susceptible to damage from tea and red wine spills – despite claims that they were “more resistant to dirt and moisture” than paper currency.
Two years ago, officials dismissed calls to change the composition of the notes, after a public consultation found 88 per cent opposed to the use of chemicals derived from animals.
The Bank acknowledged last night that the notes were “not indestructible” but insisted that the number of reissues was “consistent with the general wear” expected for banknotes, and that the damage so far had been mostly confined to “folds, tears, holes and foil wear”.
It added that 96 per cent of the £5 notes in circulation during 2018 had not had to be reissued.
It is pressing ahead with plans to replace the paper £20 note with a polymer version at the end of next month. The image on its back will be that of the artist, JMW Turner.
A “more secure” polymer £50 note, featuring the scientist Alan Turing, is due to be in circulation by the end of next year, despite the withdrawal of high-value notes in other parts of Europe amid concerns that they were being used for money laundering and tax evasion.
Mark Carney, the Bank’s outgoing governor, has championed the introduction of the polymer currency, which can be recycled into pellets that are then turned into other plastic items.
Writing in his most recent annual report, Mr Carney said the new £5 and £10 notes were “safer than paper notes, and last more than twice as long”.
He added: “They are also better for the environment due to both their longevity and recyclability.”
The Bank said last night: “While we expect the polymer notes to have a longer life, it is too early in the notes’ lifecycle to yet understand the rate of replacement of polymer notes.”