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Email this7:26 am
June 29, 2013
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Loonie - not sure it's such a GREAT deal for the Govt - for the simple reason that not many people are buying them anymore - yes perhaps certain old people "because that's the way things were done in their day" but participation has been decreasing significantly and the costs to administer are out of proportion to the return.
Yes it was a good way for people to have enforced savings, but that is not the job of the govt - that is the job of individuals to take responsibility for their finances - saving, borrowing, investing etc.
12:30 pm
September 11, 2013
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Agree on all counts, Brian. I've seen the inside of the federal government at "work" and I'm sure they had a small empire of well-paid, benefitted and pensioned civil servants and bureaucrats employed looking after a relatively small and shrinking operation.
1:56 pm
October 21, 2013
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Today's paper tells me that 2.5 million Cdns hold $6 billion of them. I don't doubt that it is a declining amount.
Apparently they have decided to keep them. I guess they don't want to offend 2,500,000 seniors, which is the group that is most likely to vote for them.
The waste of money that is clearly visible to me is to have hired KPMG to write this report, and then to decide to totally ignore it - apparently without any rationale.
Government takes on all kinds of roles that one might argue do not belong to it in order to nudge things in a certain direction. Always have, and always will. Sometimes this has been necessary or helpful for the public good, sometimes not.
2:33 pm
July 10, 2011
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I think it's a study.. Govt will act eventually..when rates come back I think it can be better with more csb outflows..
The question is do we wait this long.. My idea of a csb in this format is one that is printed and sent? Not the electronic version of everything we have today..
If this is the case it's a strong argument for reforming csb program.. Just make it all digital.. Take the costs out and see what happens..
I don't think the govt will ever end the csb program..
3:03 pm
October 21, 2013
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Old people often don't use electronic media, and that's the market.
6:05 pm
April 6, 2013
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CSB's come in two forms:
- Canada Premium Bonds that are lump sum purchase and have paper certificates, and
- no-certificate Canada Savings Bonds available only through payroll deductions.
According to the CBC article Canada Savings Bonds sales to continue, despite KPMG recommendation to stop, it's not the certificated Canada Premium Bonds that costs the government the most. It is the no-certificate Canada Savings Bonds because of the call centre and other administrative overhead needed to support the payroll savings purchases.
6:09 pm
April 6, 2013
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The full KPMG report is available on the Department of Finance web site.
It is Evaluation of the Retail Debt Program.
KPMG found that the program is supported by a Full-Time-Equivalent (FTE) headcount of 220. Operating costs are about the same as the yearly interest paid on the outstanding CSB's:
The back-office operation is managed and delivered by a team of roughly 220 human resources: 200 HP [outsourced Hewlett-Packard] and 20 Bank of Canada. Our review of comparable programs in other jurisdictions indicated that this number is high. Based on a Full-Time-Equivalent (FTE) headcount of 220, the ratio of debt outstanding per FTE is about $35 million, whereas the range for other jurisdictions was $100 million to $300 million per FTE. A more detailed analysis, beyond the scope of this evaluation, would be required to understand the reasons behind this high number.
...
Today, the operating costs of the Retail Debt Program at $58 million are equivalent to the yearly interest costs (approx. $58 million) on the outstanding stock of retail debt (see Chart 7).
....
6:41 pm
April 6, 2013
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Yatti420 said
I think it's a study.. Govt will act eventually..when rates come back I think it can be better with more csb outflows..
....
Canada Savings Bonds seem to have staying power. According to CBC article Canada Savings Bonds to pay 0.5% in 1st year, a 2004 consultants report, commissioned by the then Liberal government, also recommended the same thing:
Back in 2004, Ottawa was presented with a consultants report that recommended the CSB program be wound down, saying the move could save $650 million over nine years. But the Liberal government at the time rejected that and the Conservatives have kept bond sales going.
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