Getting rid of the penny isn't going to save taxpayers as much as the federal government indicated in the March budget.

When Finance Minister Jim Flaherty announced the impending withdrawal of the penny, he said the government would save $11 million a year in production costs.

That's because it costs about 1.6 cents to make each one-cent coin.

But a new analysis of costs, released today, shows that taxpayers will likely only see a savings of about $4 million each year over a six-year period.

That's because it will cost about $38.3 million to redeem some six billion pennies over that same six years.

Here's how the math works.

It's expected to cost $53 million to pay the banks for the face value of the coins, as well as another $27 million in handling and administration costs by the Royal Canadian Mint.

Recycling the zinc and copper from melted-down pennies will bring in about $42.5 million in revenue, leaving the government in the red at just over $38 million.

Adding the $11 million in annual savings from not minting any more pennies gives the government annual savings of almost $4 million per year.

The mint stopped making the coins in May and will stop distributing pennies to financial institutions as of Feb. 4, 2013