The Bank of Canada has signed a contract with EDS Canada Inc. for the provision of systems and operations support services for the federal government's retail debt program to ensure more flexible and cost-effective service.

About 500 Bank of Canada staff are expected to join EDS in its Ottawa offices as part of a 9.5-year contract valued at $400 million, beginning 1 September 2001. The contract results from a year-long competitive process to select a private sector partner from among a number of leading outsourcing companies.

The Bank of Canada will continue to provide advice and serve as fiscal agent for the retail debt program and will remain accountable for customer service, bondholder records, and debt accounting. The Department of Finance Canada retains overall responsibility for the retail debt program. An agency of the department, Canada Investment and Savings, remains responsible for day-to-day management of the program, including product development, interest rate setting, and sales and marketing.

Customer service to Canadians will continue to be provided without charge to owners and buyers of Canada Savings Bonds, Canada Premium Bonds, and other retail debt securities, and through the same established channels, including existing toll-free telephone numbers.

The outsourcing contract will reduce staff levels at the Bank by close to one-third, including about 55 staff being offered departure packages because their positions are being eliminated.