Effective November 2017, the Canada Savings Bonds program will be discontinued. This means that both the Savings (CSB) and Premium (CPB) bonds will no longer be available for investment or purchase after October 31, 2017.
Who is affected?
Organizations who offer CSBs through a Payroll Savings Program, and the employees who participate in that program.
When should CSB payroll deductions stop?
The CSB deductions can continue to be deducted from pay and will go towards participants' plans until October 31, 2017, unless the employee and/or your organization's Campaign Director decides otherwise.
All employees' CSB deductions must stop as of November 1, 2017.
The last payroll contribution file must be submitted as per the normal procedure by October 31, 2017.
What else do I need to do?
Communication to the employees ahead of time to help them understand the changes is always a good idea. The Government has already put together a Sample Employee Communication (Word doc link) template to assist your change management.
What about employees' current CSB investments?
Worry not! The funds in participants' Payroll Savings Plan are safe, guaranteed, and will be honoured. All bonds purchased before November will continue to earn interest until the time of redemption or maturity, whichever happens first.
Bond owners can redeem the bonds at any time by accessing the CSB Online Services. Previously, any maturing bonds purchased through the Payroll Savings Plan would be automatically rolled over into the next available series along with accrued interest.
Why is this happening?
The CSB program has been experiencing an overall decline in sales and is no longer a main component of the federal debt-management strategy.
Where can I find more information?
The Federal Government has prepared an excellent and thorough list of CSB Program Questions and Answers for employers, employees and financial institutions.
References and Further Reading on the End of the CSB Program
- Important announcement about the Canada Savings Bonds Program
- Payroll Savings Program: Employees
- Payroll Savings Program: Employers
- Questions and Answers
- Redeeming Funds
- Sample Employee Communication (Word doc link)
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About the Author
Kim Groome, PCP, is a Solution Specialist at Avanti Software. Kim works closely with the Sales & Marketing team to show prospective clients how Avanti's all-in-one people management solution can help their organization. She also develops a variety of resources for Marketing and Customer Success.More Resources by Kim Groome