The value of one consulting firm’s federal contracts has skyrocketed under the Trudeau government | 24CA News
The consulting agency McKinsey & Company has seen the amount of cash it earns from federal contracts explode since Prime Minister Justin Trudeau got here to energy — to the purpose the place some recommend it might have a central function in shaping Canada’s immigration insurance policies.
A Radio-Canada investigation additionally discovered the personal consulting agency’s affect is elevating issues inside the federal public service.
According to public accounts knowledge from Public Services and Procurement Canada (PSPC), the Liberals spent 30 occasions more cash on McKinsey’s companies than Stephen Harper’s Conservatives did.
In the 9 years of the Harper authorities, McKinsey was awarded $2.2 million in federal contracts. During Trudeau’s seven years in workplace, the corporate has acquired $66 million from the federal authorities.
McKinsey, an American agency with 30,000 consultants in 130 workplaces in 65 nations, offers recommendation to each personal and public entities — which typically have conflicting pursuits — and doesn’t disclose its business ties.
For instance, Export Development Canada has paid McKinsey $7.3 million to supply varied analyses since final 12 months. The Business Development Bank of Canada paid the corporate $8.8 million for recommendation in 2021 and 2022.
Major function in immigration division
Radio-Canada’s evaluation exhibits that Immigration, Refugees and Citizenship Canada (IRCC) has turned to McKinsey essentially the most since 2015, with $24.5 million in contracts for administration recommendation.
IRCC and the Canada Border Services Agency account for 44 per cent of federal compensation issued to the agency.
McKinsey refused to reply Radio-Canada questions relating to its function and agreements with the federal authorities. The authorities didn’t present copies of the agency’s studies in response to Radio-Canada’s request.
McKinsey’s affect over Canadian immigration coverage has grown lately with out the general public’s information, in response to two sources inside IRCC. Both spoke on the situation of anonymity as a result of they weren’t approved to talk publicly.
Both held main roles inside the division in the course of the top of the consulting agency’s affect and spoke to Radio-Canada individually.
“It was completely opaque. We asked to collaborate, to share our ideas, but it didn’t work,” mentioned one supply with an essential place inside IRCC.
“McKinsey was an idea from the government. The policy was decided for civil servants. It causes a lot of operational instability,” mentioned the second supply.
“These people, these firms forget the public interest, they’re not interested in it. They’re not accountable.”
According to contracts, McKinsey was employed by IRCC to develop and implement varied methods for “transformation.”
An IRCC spokesperson mentioned the consulting agency was tasked with reviewing, growing and implementing digital instruments, processes and companies.
The division spokesperson mentioned the contract was revised in the course of the pandemic — at an elevated value — to assist IRCC reply to pressures associated to the pandemic, take care of acute demand and keep important companies for purchasers.
A mandate for ‘transformation’
Representatives of McKinsey facilitated or attended about 10 conferences of the IRCC transformation committee, in response to paperwork obtained below entry to info legislation. The paperwork don’t embody particulars of these shows.
“We had a few presentations on very generic, completely vapid stuff. They arrived with nice colours, nice presentations and said they would revolutionize everything,” one of many sources mentioned.
“In the end, we don’t have any idea what they did,” the supply added, referring to “nice marketing” that “isn’t science.”
Before a federal committee listening to in late November, IRCC Deputy Minister Christiane Fox mentioned McKinsey was concerned within the transformation and modernization of the division’s methods.
“According to managers and politicians, everything that comes from outside is always better, even if we had enough resources internally,” mentioned one division supply.
“[McKinsey] always says they have great expertise, but it doesn’t make sense because we have expertise and we’re completely pushed aside,” mentioned the opposite.
McKinsey head really useful immigration increase
The IRCC sources are additionally essential of McKinsey’s potential affect over Canada’s immigration targets.
Ottawa introduced a plan this fall to welcome 500,000 new everlasting residents annually by 2025, with an emphasis on fostering financial development.
The goal and its acknowledged justification observe related conclusions in the 2016 report of the Advisory Council on Economic Growth, chaired by McKinsey’s then-global head Dominic Barton.
The advisory council really useful a gradual enhance in everlasting immigration to 450,000 folks per 12 months to reply to labour market dynamics. At the time, Canada was accepting about 320,000 everlasting residents.
John McCallum, the immigration minister on the time, expressed his reservations in regards to the “huge figure” offered within the report.
But one of many sources at IRCC mentioned the division was shortly advised that the advisory council’s report was a foundational plan.
‘Telling fact to energy’
While Dominic Barton chaired the advisory council from 2016 to 2019, he left McKinsey in July 2018 after a 30-year profession with the agency. The subsequent month, the consulting agency began its first contract with IRCC.
Trudeau named Barton Canada’s ambassador to China in 2019 — a put up he held for 2 years earlier than leaving and becoming a member of the mining agency Rio Tinto.
Shortly earlier than the pandemic, parliamentarians pressed Barton on the work he did for Chinese companies throughout his time at McKinsey.
“I’m very proud of my career and time in the private sector,” Barton mentioned. “We’re known for telling truth to power.”
Barton can be a co-founder of The Century Initiative, an advocacy group calling for insurance policies that might deliver Canada’s inhabitants to 100 million by 2100.
The group was based in 2011, whereas Barton was nonetheless at McKinsey, and has an present government from the agency on its board of executives.
The Century Initiative has been listed on Canada’s lobbyist registry since 2021. It has organized conferences with the immigration minister’s workplace, the minister’s parliamentary secretary and Conservative and NDP MPs.
Radio-Canada’s inquiries to Barton in regards to the enhance in McKinsey’s contracts haven’t been answered.
Single-source contracts
Departments apart from IRCC even have turned to McKinsey.
Public Services and Procurement Canada used the corporate for pc companies. Innovation, Science and Economic Development Canada employed it for administration recommendation, in addition to science and analysis companies.
The Department of National Defence additionally paid McKinsey a number of million {dollars} for management improvement.
Some of those contracts are nonetheless in progress and their whole value is not identified but.
According to Radio-Canada’s analysis, PSPC has referred to as upon McKinsey on behalf of varied federal entities for 18 contracts since 2021 — contracts price greater than $45 million.
All of these contracts have been sole-source, in response to paperwork obtained by Radio-Canada.
The Prime Minister’s Office referred inquiries to the Treasury Board Secretariat (TBS). In an announcement, the TBS mentioned exterior skilled companies deliver in particular experience and assist to deal with fluctuations within the civil service workload.
According to TBS spokesperson Martin Potvin, such a contract might assist fill shortages in sure work teams or geographic places.
He mentioned the choice to resort to outdoors corporations rests with particular person departments.
‘Shadow authorities’
Benoit Duguay, a professor on the Université de Québec à Montreal’s School of Management Services, mentioned he is stunned by McKinsey’s obvious affect.
“How come McKInsey has the skills to do absolutely everything a government does? … It looks like another level of government. Almost a supranational government,” Duguay mentioned in French.
(Duguay is a former advisor himself, although not at McKinsey.)
Isabelle Fortier, professor on the École nationale d’administration publique in Quebec, mentioned using corporations like McKinsey suggests a break between politics and administration of the state.
She mentioned it supplants the inner experience of the civil service and operates as a “shadow government” with out transparency or legitimacy.
The federal authorities mentioned it employs consulting corporations to supply high-quality companies and guarantee the very best worth for taxpayers. It mentioned departments are required to award contracts in a good, open and clear method.
Controversy and requires accountability
McKinsey has suggested many nationwide governments on their COVID-19 pandemic response lately, together with these within the U.S., U.Okay., Germany and Mexico.
The governments of Quebec and Ontario additionally employed McKinsey to advise them on their pandemic responses and plan for the financial restoration.
An investigation by the French Senate accused consulting corporations like McKinsey of undermining nationwide sovereignty and making the state depending on them.
McKinsey additionally has been below investigation in France over tax filings, the awarding of contracts and its function in President Emmanuel Macron’s 2017 and 2022 election campaigns.
In Canada, some specialists are additionally calling for an inquiry.
Ontario lawyer Lou Janssen Dangzalan, who has been learning IRCC’s digital reforms, mentioned an inquiry might present transparency on how consulting corporations deal with authorities contracts.
Fortier, who studied McKinsey’s document in France, mentioned she helps a public inquiry into using consulting corporations.
“We must force the black boxes to open,” she mentioned in French.
