Canada’s chief statistician says a controversial “pilot project” involving the collection of customer data from banks will not go ahead until the anxieties about the effort are addressed. Anil Arora told the Senate of Canada’s banking, trade and commerce committee on Thursday that the proposal has not yet been implemented and that no related data has been harvested by Statistics Canada. “I can assure you that we will not proceed with this project until we have addressed the privacy concerns expressed by Canadians by working cooperatively with the privacy commissioner and with the financial institutions,” Arora said.
The flurry of concern over the StatsCan proposal began when Global News reported in late October that the agency was asking several banks for information on the financial transactions of hundreds of thousands of Canadian households. After the report was published, Arora said in a statement that the traditional ways of gathering information, “are no longer sufficient to accurately measure Canada’s economy and societal changes.” Arora added that more than three-quarters of purchases are made online by Canadians, and that Statistics Canada “has to have access to these data” in order to provide quality statistics in certain areas, such as housing and debt. The chief statistician continued to defend the need for quality stats on Thursday, noting there is wide use of the agency’s information. He noted that, “while the notion of 500,000 addresses may seem large,” there are more than 14 million households in Canada. Arora also stated at the end of October that they had already worked with the Office of the Privacy Commissioner of Canada during the planning of the project, but that he had invited the commissioner to provide additional recommendations on the effort. Soon after, the privacy commissioner’s office announced an investigation into StatsCan, saying they had received complaints about the agency “and its collection of personal information from private sector organizations.” But when the privacy commissioner appeared before the committee on Thursday, the watchdog said the potential size of the pilot project was relatively new knowledge. “Before these complaints, we had discussions about administrative data collection in general, about certain pilot projects in general, but not about numbers until very recently,” said Daniel Therrien, the privacy commissioner. Neil Parmenter, the president and chief executive officer of the Canadian Bankers Association, told the committee that the group and its members “have been clear that we have serious concerns over the privacy implications of the StatsCan transaction-level data request.”
(The CBA has) been clear that we have serious concerns over the privacy implications of the StatsCan transaction-level data request
Neil Parmenter, Canadian Bankers Association
Parmenter, like Arora, stressed that no customer-transaction data or other personal information had been transferred to StatsCan, although he added later that some financial institutions had received “compel letters.” The CBA, he said, was also encouraged that the privacy commissioner was reviewing the request. “Trust and confidence of the Canadian public is critical,” Parmenter said. “As such, the banking sector continues to emphasize the central importance of protecting the privacy and security of customer financial data and personal information.” The issue has also become a political football, with the Senate banking committee saying it would hold “at least” one hearing on the subject. Collection of banking data has become a topic of debate in the House of Commons as well. Conservative opposition leader Andrew Scheer declared on Wednesday that, “the only thing Canadians want to hear from the Prime Minister is that he is cancelling the project.” Prime Minister Justin Trudeau fired back by saying that the government understands the need for reliable data, but also prioritizing the protection of privacy. “That is why this data that Statistics Canada collects is anonymized, is subject to stringent controls,” Trudeau added. “Indeed, this is the pilot project it is working on now, which has not even rolled out yet.” • Email:
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For investors the unexpected shift pressed on an old nerve, said David Tyerman, transportation and industrials analyst with Cormark Securities. “Bombardier has had problems historically and the problem is often that their balance sheet gets into trouble because they chew up a lot of cash,” he said. “So this is tapping into a long-standing concern. It did come out of the blue and with a company that has a fair bit of debt. It’s a sensitive issue.” Bombardier is carrying $9.5 billion in adjusted debt, much of it built up through cost overruns and delays tied to the development of its Global 7500 private jet and the C-Series narrow-body airliner. “Investors won’t like the big chop to cash flow guide, which raises questions (regarding) management credibility and ability to complete a successful turnaround,” Cai von Rumohr, an analyst with Cowen Equity Research wrote in a note to clients. Bellemare is pursuing an aggressive strategy in a bid to build Bombardier’s future around trains and private planes. The firm ceded 50.1 per cent of the C-Series airliner to European giant Airbus Group SE earlier this year and the long-range Global 7500 business jet is set to debut next month. It has also slashed costs, selling off non-core assets and streamlining processes. The asset sales announced yesterday will bring in about $900 million. The company still holds its CRJ regional jet program, where it will focus on reducing costs while exploring “strategic options” for the future, the company said. 
The turnaround drive has brought with it thousands of job cuts. The latest round, announced yesterday, will yield annual savings of $250 million by 2021, the company said. “This is very bad news, it sends a worrisome message about the future of the industry,” Renaud Gagne, head of the Unifor labor union’s Quebec branch, said in a statement. “We are in the dark as far as what comes next.” Since Bellemare took the reins in 2015, the company has improved its profitability and made strides toward its 2020 objectives, analysts say. Bombardier’s profit margin (EBIT margin) on its rail division rose to 9.3 per cent last year compared with 5.6 per cent in 2015. Meantime, the profit margin in its business jet division rose to 8.4 per cent from 4.4 per cent over the same period. “From a business jet standpoint Bombardier appears to be in a much better position now compared to a few years ago,” Daniel Hall, senior valuations analyst with FlightAscend Consultancy said in an email. “Speaking to the market, there is definitely a lot more confidence with Bombardier — they are also in better shape with regards to delivery numbers and orders.” 
