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(Bloomberg) — The Bank of Canada is planning to eliminate hundreds of jobs, about 10% of its workforce, as part of Prime Minister Mark Carney’s bid to reduce government expenses.
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About 225 employees at the central bank will be affected, according to a memo seen by Bloomberg News. The cuts will take place “over the next few months” and be completed by June, it said.
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In the note, the bank said it has already lowered non-salary budgets, closed job vacancies and extended early retirement options to employees. But that won’t be enough to reach the 10% budget cost savings the bank committed to by the end of 2026.
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A spokesperson for the Bank of Canada said the organization will align with Carney’s request to save money, as it has done with similar programs in the past.
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The central bank is committed to achieving a 15% total budget reduction over the 2026 to 2028 period, spokesperson Paul Badertscher said in an emailed statement. “Reductions are happening in all departments,” he said. “We will make sure that the bank remains able to deliver on its mandate for Canadians.”
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The number of people working at the bank has surged since the Covid-19 pandemic. The Bank of Canada employed 2,350 people at the end of 2023, up from approximately 1,800 in 2019.
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The cuts are part of the Canadian government’s broader expenditure review. On Tuesday, Finance Minister Francois-Philippe Champagne’s budget included plans to find savings of C$60 billion ($42.5 billion) over the next five years, including shrinking the size of the public service by about 40,000 people.
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At the same time as the spending review, Carney’s government is giving new regulatory responsibilities to the central bank, including oversight of the so-called Consumer-Driven Banking Act.
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In the budget, the government said the bank could retain additional remittances to help fund those new projects.
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In the memo, the bank said it has also committed to another 5% reduction in “corporate-level expenditures” by the end of 2028.
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A letter to federal workers from Privy Council Clerk Michael Sabia, the head of the public service, acknowledged that the planned 40,000 job cuts will have “real consequences for people who serve their country and for their families. I am not going to try to diminish those consequences. They are real.”
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He also said achieving C$60 billion in savings will require “reducing a number of programs, limiting the scope of some and terminating others outright.”
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