Briefing binder created for the Interim Deputy Minister of Finance on the occasion of his appearance before the Standing Committee on Government Operations and Estimates on June 21, 2023 on “Federal Government Consulting Contracts Awarded to McKinsey & Company”

On this page

• Committee Member Biographies
• Parliamentary Environment Analysis
• Summary and Rationale for Redactions to Finance Submission
• Summary and Rationale for Redactions to CDEV Submission

Committee Member Biographies

About the Committee

The Standing Committee on Government Operations and Estimates focuses on the estimates process as well as on the effectiveness and proper functioning of government operations.

Under Standing Order 108(3)(c), the Committee's mandate includes the study of:

• the format and content of all estimates documents; and
• the effectiveness, management, and expenditure plans of:
  • central departments and agencies;
  • new information and communication technologies adopted by the government;
  • cross-departmental mandates, including programs delivered by more than one department or agency;
  • Crown corporations and agencies that have not been specifically referred to another standing committee; and
  • statutory programs, tax expenditures, loan guarantees, contingency funds and private foundations deriving the majority of their funding from the Government of Canada.

Liberal Party

Parm Bains
Liberal, Steveston–Richmond East (British Columbia)

Parm Bains has been the Member of Parliament for Steveston-Richmond East since 2021. He currently serves as member on the Standing Committee on Government Operations and Estimates and Standing Committee on Access to Information, Privacy and Ethics.

Prior to his election, Mr. Bains served as a public and media relations officer for the Government of British Columbia. He was also a lecturer at Kwantlen Polytechnic University. He obtained his degree from the British Columbia Institute of Technology and earned a master's degree from Royal Roads University.

Anthony Housefather
Parliamentary Secretary to the Minister of Public Services and Procurement
Liberal, Mont-Royal (Quebec)

Anthony Housefather has been the Member of Parliament for Mount Royal since 2015. He currently serves as the Parliamentary Secretary to the Minister of Public Services and Procurement.

In Parliament, he was Chair of the Standing Committee on Justice and Human Rights from 2015-19. He also served as Parliamentary Secretary to the Minister of Labour from 2015-21.

Mr. Housefather has two law degrees from McGill University and an MBA from Concordia University's John Molson School of Business. Prior to his election, he served as Executive Vice President Corporate Affairs and General Counsel at a multinational technological company, Dialogic Corporation. Moreover, Mr. Housefather served as Mayor of Côte-Saint-Luc between 2005 and 2015.

Majid Jowhari, Vice Chair
Liberal, Richmond Hill (Ontario)

Majid Jowhari has been the Member of Parliament for Richmond Hill since 2015. He is currently Vice-Chair of the Government Operations and Estimates Committee and a member of the Standing Committee on Health. He is also the Vice-Chair of the Canada-China Legislative Association.

Mr. Jowhari is a strong advocate for mental health awareness. He founded the all-party Mental Health Caucus in 2017, advocating for mental health initiatives on Parliament Hill.

In addition, he was named 2018 Parliamentary Mental Health Champion by the Canadian Alliance on Mental Illness and Mental Health in recognition of his Bill C-375, An Act to amend the Criminal Code (presentence report), which was dropped from the Order Paper with the 2019 election.

Prior to entering politics, Mr. Jowhari specialized in large business transition and transformation enabled by technology. He advised fortune 500 companies on strategy and extending value chain business process re-engineering supply chain optimization. He attributes this experience to helping bridge his current role as an MP, where he helps businesses and organizations in the community flourish and further facilitating community and business forums.

Irek Kusmierczyk
Parliamentary Secretary to the Minister of Employment, Workface Development and Disability Inclusion
Liberal, Windsor-Tecumseh (Ontario)

Irek Kusmierczyk has been the Member of Parliament for Windsor-Tecumseh since 2019. He currently serves as the Parliamentary Secretary to the Minister of Employment, Workface Development and Disability Inclusion

Mr. Kusmierczyk's family have lived in Windsor for more than 35 years after immigrating to Canada from Poland. His parents instilled in him a passion for community service, leading him to a career on Windsor City Council, where he was elected three consecutive times. While on council, he successfully advocated for historic investments in flood protection, road improvements, libraries, and parks.

Mr. Kusmierczyk worked as the Director of Partnerships for WEtech Alliance, a non-profit regional innovation centre that helps grow technology companies and jobs throughout Windsor, Essex County and Chatham-Kent. He built partnerships with industry, local schools, the University of Windsor, and St. Clair College to grow the FIRST Robotics program in Windsor and Essex that prepares young people for careers in STEM and skilled trades.

Mr. Kusmierczyk earned his PhD from Vanderbilt University with a specialization in local government and cross-border environmental relations around the Great Lakes basin and holds a master's degree from the London School of Economics and Political Science.

Joanne Thompson
Liberal, St. John's East (Newfoundland and Labrador)

Joanne Thompson has been the Member of Parliament for St. John's East since 2019. Ms. Thompson is Chair of the National Seniors Caucus and sits on the Standing Committee on Environment and Sustainable Development and the Standing Committee on Government Operations and Estimates.

Ms. Thompson is a strong advocate for social justice, entrepreneurship, and supporting communities. She attributes this passion from her time volunteering at St. Clare's Hospital at a young age. Prior to her election, Ms. Thompson worked as a registered nurse while attending Memorial University part-time. She continued her career in community health until 1990 when she turned her focus to building a family business with her husband while studying to qualify as a graduate gemologist.

Ms. Thompson also served as the Executive Director of The Gathering Place, a community health centre serving vulnerable populations in downtown St. John's. During her time there, The Gathering Place added an overnight shelter and saw an increase in available services over a four-year period.

Conservative Party

Michael Barrett
Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes (Ontario)

Michael Barrett has been the Member of Parliament for Leeds-Grenville-Thousand Islands and Rideau Lakes since 2018. Mr. Barrett is currently the Opposition Critic for Ethics and Accountable Government. He serves on the Standing Committee on Access to Information, Privacy and Ethics and the Standing Committee on Government Operations and Estimates.

In Parliament, Mr. Barrett has been an advocate for regional priorities such as improving mobile coverage to rural areas through enhanced digital infrastructure and infrastructure projects including major roads and recreational facilities. He is committed to supporting farmers, improving services and care for seniors and veterans, increasing supports for mental health and addiction, and lowering taxes for Canadians.

Prior to his election, Mr. Barrett served in the Canadian Armed Forces as a Telecommunication Lineman. During his time in the CAF, he was posted to CFB Edmonton and participated in domestic operations including at CFS Alert in Canada's High Arctic.

After serving in the CAF, Mr. Barrett worked in the private sector as a human resources manager and a municipal councillor in the Township of Edwardsburgh Cardinal. As councillor, Mr. Barrett chaired the Public Works and Environmental Services Committee and sat on the Port of Johnstown Management Board.

Kelly Block
Conservative, Carlton Trail—Eagle Creek (Saskatchewan)

Kelly Block was first elected in 2008 as the Member of Parliament for Saskatoon-Rosetown-Biggar. She has been the representative for the new riding of Carlton Trail-Eagle Creek since 2015.

Ms. Block currently serves as Opposition Critic for Public Services and Procurement. She was previously the Chair of the Standing Committee on Public Accounts, where served until August 2021. During the 41st Parliament, she served as the Parliamentary Secretary to the Minister of Natural Resources.

In the 43rd Parliament, Ms. Block introduced Bill C-268, An Act to amend the Criminal Code (intimidation of health care professionals), which was dropped from the Order Paper with the 2021 election. The bill aimed protect medical professionals who do not want to participate in medical assistance in dying.

Prior to her election, Ms. Block served on the town council of Waldheim, Saskatchewan for three terms, serving two as mayor. She was also a member of the Saskatoon Regional Health Authority and the Director of Administration at Forest Grove Community Church.

Stephanie Kusie
Conservative, Calgary Midnapore (Alberta)

Stephanie Kusie has been the Member of Parliament for Calgary Midnapore since 2017. She currently serves as the Opposition Critic for the Treasury Board.

In Parliament, she previously served as Deputy Opposition Critic for Health and Opposition Critic for Democratic Institutions, for Families, Children and Social Development, and for Employment, Future Workforce Development and Disability Inclusion. In 2018, Ms. Kusie was elected to the Executive Committee of the Canadian Section of ParlAmericas Interparliamentary Association. In 2020, she joined the International Parliamentary Network for Education as a founding member.

Prior to her election, Ms. Kusie was as a diplomat for the Canadian federal government where she served in Argentina in 2016; was chargée d'affaires and Consul for Canada in El Salvador from 2006-2008; and Consul for Canada at the Consulate in Dallas, Texas from 2010-2013. She also served as policy advisor to former minister Peter Kent during his time as Minister of State for Foreign Affairs for the Americas in 2009. Some of her past duties included negotiating free trade deals, work related to the Keystone Pipeline project, and lobbying the United Nations to place Canada on the Security Council.

She holds a Bachelor of Arts in Political Science from the University of Calgary and an MBA from Rutgers University.

Kelly McCauley, Chair
Conservative, Edmonton West (Alberta)

Kelly McCauley has been the Member of Parliament for Edmonton West since 2015.

Mr. McCauley is currently the Chair of the Standing Committee on Government Operations and Estimates and a member of the Standing Committee on Public Accounts. He previously served as the Opposition Critic for Treasury Board.

Mr. McCauley was born and raised in North Vancouver, graduating from the British Columbia Institute of Technology in 1982. Prior to entering politics, Mr. McCauley spent more than 30 years managing hotels and convention centres from Victoria to St. John's. During that time, he served on many volunteer boards including as Vice President of the Burnaby Board of Trade and Vice Chair of the Avalon Convention and Visitors Bureau.

Mr. McCauley is an advocate for seniors, having served as past president of the Greater Victoria Eldercare Foundation, the largest seniors hospital foundation on Vancouver Island, where he continues to serve as a special advisor. In recognition of his advocacy for veterans, Mr. McCauley was named an honourary member of the Vancouver Island Aircrew Association.

In Edmonton, Mr. McCauley served on the Executive Committee of the Board of Northlands and the Board of the Alberta Aviation Museum. He was also the chairperson of the EI Board of Referees for Edmonton and Northern Alberta and was a founding c-chair of the Edmonton Destination Marketing Hotels.

Bloc Québécois

Julie Vignola, Vice Chair
Bloc Québécois, Beauport-Limoilou (Québec)

Julie Vignola has been the Member of Parliament for Beauport-Limoilou since 2019. She currently serves as the Bloc Québécois Critic for Public Services, Tourism, Government Operations and Procurement.

In Parliament, Ms. Vignola was previously a member of the COVID-19 Pandemic Committee. She is interested in issues affecting Quebec and its residents, most notably around producers and the Phoenix Pay System

Prior to her election, Ms. Vignola was a teacher at a private high school. She holds a bachelor's degree in history and geography from the Université du Québec à Rimouski.

New Democratic Party

Gord Johns
New Democrat, Courtenay-Alberni (British Columbia)

Gord Johns has been the Member of Parliament for Courtney-Alberni since 2015. He currently serves as the NDP Critic for Mental Health, Public Services and Procurement.

In the previous parliaments, Mr. Johns served as the NDP Critic for Small Business and Tourism, Fisheries and Oceans, and Veterans Affairs. He also introduced a private members' bill for a National Cycling Strategy as well as an amendment to the Income Tax Act (C-264, and C-310 in 2022) to increase tax credits for volunteer firefighter and search and rescue responders.

Prior to his election, Mr. Johns was a small eco-business owner, municipal councillor and executive director of the Tofino-Long Beach Chamber of Commerce. He was also an advocate for the environment, coached kids sports and volunteered with the West Coast Recreation Society.

Parliamentary Environment Analysis

Standing Committee on Government Operations and Estimates
Federal Government Consulting Contracts Awarded to McKinsey & Company

Background

• On January 18, 2023, the Standing Committee on Government Operations and Estimates (OGGO) adopted a motion to undertake a study on government consulting contracts awarded to McKinsey & Company since January 1, 2011, with the goal of examining their effectiveness, management and operation including the value and service received by the government. The motion included a request that all departments, agencies, and Crown corporations provide the committee with all documentation related to any such contracts.
• Finance Canada provided all of its relevant documents, in both official languages, to the committee on the requested due date of February 22, 2023. (In contrast, some other departments are providing documents in tranches due to the high volume involved and time required to translate them). On March 7, 2023, the Chair of the Committee wrote to several departments requesting that their documents be resubmitted without redactions. The Deputy Minister of Finance responded with a letter on March 10, 2023, outlining the reasons behind the redactions in the department's submission.
• Over the course of 11 meetings held for this study, OGGO heard from former and current McKinsey associates including Dominic Barton. The committee also heard from the ministers of Public Services and Procurement, Treasury Board, Immigration, Refugees and Citizenship, Public Safety, and National Defence, as well as the Canada Infrastructure Bank, Business Development Bank of Canada, unions, and academics. While OGGO invited the Deputy Prime Minister and Minister of Finance to appear earlier on in the study, she has not appeared.
• During past meetings, committee members repeatedly questioned government officials on the reasons behind redactions in their submissions. Apparently unsatisfied with the responses, the committee adopted a motion on April 24, 2023, to invite the deputy heads of departments, agencies, and Crown corporations who submitted documents with redactions to discuss and answer to "the redactions and improper translation of documents requested by the committee".
• On June 5, 2023, OGGO held its first meeting pursuant to the April 24 motion with a panel of representatives from nine institutions, mostly deputy heads, including one from the Privy Council Office who delivered an opening statement in lieu of every organization delivering one. Michel Leduc, Senior Managing Director and Global Head, Public Affairs & Communications, Canada Pension Plan Investment Board also appeared and delivered an opening statement explaining that releasing commercially sensitive information could harm its competitive position in the global market.
• Discussion at the June 5 meeting largely focused on two themes. First, Parliament's claim to an unfettered right to access information versus the Government of Canada's statutory requirements to protect certain information (e.g., under the Privacy Act). At the onset, the House of Commons Law Clerk and Parliamentary Counsel made a statement outlining the right (privilege) of committees to request documents. Second, questions were posed about specific contracts with McKinsey and the results they achieved.
• June 19 will be the second and final planned meeting pursuant to the April 24 motion.

Conservative Party (CPC)

• On June 5, Conservative members used the House Law Clerk's testimony to raise concerns over the legal and constitutional grounds for departments to withhold information from Parliament. MP Michael Barrett contended that departments received political direction to redact certain information. He also contrasted the government's stance on applying redactions with McKinsey's unredacted submission to the committee.
• MP Stephanie Kusie has been vocal in her frustration with the value of contracts awarded to McKinsey and the amount of work rendered. Ms. Kusie has raised concerns about the government's justification of these expenditures as Canadians struggle with rising costs of living and inflation.
• Conservative members have raised questions about the relationship between key government actors and Dominic Barton and other McKinsey employees, suggesting that these relationships led to a significant increase in government contracts with the firm. In this regard, Conservatives have contended that McKinsey has had undue influence over the development of federal public policy. For example, MP Pierre Paul-Hus pointed to the Advisory Council on Economic Growth (ACEG) recommendation to welcome 450,000 immigrants by 2025, and the government's decision to increase the levels to 500,000.
• In the context of the Advisory Council on Economic Growth, MPs Kelly Block and Stephanie Kusie questioned the intentions behind the pro bono work of Dominic Barton and McKinsey employees. MP Block asked questions about whether pro bono work was a way for McKinsey to become known to the government and obtain additional contracts.

Bloc Québécois (BQ)

• The BQ has been the most vocal in their dissatisfaction with the quality of translations of departmental submissions. MP Julie Vignola has focused on her right to obtain documents in French without having to make concessions to her native language. No concerns about the translation of documents submitted by Finance, or its portfolio organizations, have been raised in public meetings.
• A key concern for Ms. Vignola has been around whether policy decisions have come from McKinsey employees or public servants. She has sought assurances from departments that this type of information has not been withheld. This dovetails with concerns over whether McKinsey has had undue influence over the government's decision-making, particularly with respect to recommended immigration targets.
• Ms. Vignola has asked about how to improve integrity and confidentiality processes related to outsourcing to ensure the correct information is tracked and disclosed. Likewise, she has asked about ways to safeguard ownership of government data being used by contractors. Ms. Vignola has also questioned whether McKinsey should be a registered lobbyist.

New Democratic Party (NDP)

• While the NDP has expressed dissatisfaction with the redaction of information provided by federal institutions, they have raised the need to balance parliamentary privilege while minimizing risk to certain information and entities such as the Canada Pension Plan Investment Board.
• The NDP has expressed its belief that contractors have too much influence over government decision-making processes. In this regard, they have sought to shift the committee's focus away from McKinsey and onto contractors in general.
• MP Gord Johns has frequently raised the concern that outsourcing work has resulted in a hollowing out of the public service's capacity to provide advice and deliver programs, and the impacts this has on the morale of public servants. Further, the party's preference is to retain and maintain full time public service jobs, which they believe are being supplanted by contractors
• Mr. Johns has also questioned whether departments received political direction to redact information submitted to the committee.

Liberal Party (LPC)

• In their comments and questions, Liberal members have reinforced the position that parliamentarians have an unfettered right to access information. They have expressed discontent with the number of redactions made by federal institutions, including in contrast to the unredacted submission provided by McKinsey. For this reason, they have questioned officials on the reasons behind the redactions and ways to improve the process in the future.
• MP Anthony Housefather has been vocal in his frustration with competing interpretations on the disclosure of information by government to Parliament. He holds the view that Parliament is responsible for making the final determination and has challenged officials on the authority that allows the government to withhold information.
• LPC members have raised the need to improve transparency and reduce reliance on government outsourcing. Overall, members have focused their questions on ways to improve procurement integrity measures to ensure that sensitive government information is protected when engaging with consulting firms.
• This is consistent with questions that have been raised about strengthening procurement processes to better measure outcomes to ensure that contractors do not have undue influence on government decision-making. To address these concerns, the LPC has repeatedly sought information on international comparisons of government outsourcing practices.

Summary and Rationale for Redactions to Finance Submission

Finance Canada Submission on McKinsey Contracts/Agreements to the House of Commons Standing Committee on Government Operations and Estimates (OGGO) – Summary and Rationale for Redactions

Finance Canada's February 22, 2023, document submission to OGGO protected four categories of information from disclosure. The information in each of these categories is routinely redacted by federal institutions on records prior to being disclosed to other parties or members of the public. For example, when processing Access to Information Act requests or when sharing documents through other mechanisms such as motions from Parliamentary committees.

Below is a general rationale for protecting each of the four categories of information.

The chart describes the redactions applied to the Finance package, which consisted of documents pertaining to the Advisory Council on Economic Growth, and to the Canada Development Investment Corporation (CDEV) contract on the U.S. Inflation Reduction Act. The descriptions below provide more context than one would glean from the documents provided to the committee, but without disclosing the sensitive details redacted. Where applicable, an additional rationale for protecting the information is provided. *Sentence redacted*.

Personal Information

• The redacted information qualifies as personal information because it consists of information about an identifiable individual.
• The personal information protected mostly consists of hand-written signatures, addresses, social insurance numbers, personal banking information, dietary restrictions, and official language preferences.
• The Privacy Act permits the disclosure of personal information to a third party in very limited circumstances when its disclosure clearly outweighs any potential resulting invasion of privacy. This test was not met in this instance as releasing this information would not have added any value for the Committee or others interested in the study.

Security of systems or structures

• Public servants' mobile numbers have been redacted to avoid personal security threats to individual mobile device holders, as this information can be used for geolocation tracking and malicious targeting.
• Information relating to the department's secure IT infrastructure was protected as disclosure poses real and serious security risks to the integrity of Finance Canada's network. Public disclosure of this information exposes the department to potential future cyber attacks and Finance Canada has consistently protected this information since the occurrence of significant cyberattack in 2011.

Solicitor-client privilege

• The protection of legal advice ensures that communication between a government institution and its solicitors is protected to the same extent as it is in the private sector.
• The interest protected by this privilege is of all persons to have full and ready access to legal advice without concern of disclosure. If an individual cannot confide in a lawyer knowing that what is said will not be revealed, it will be difficult, if not impossible, for that individual to obtain proper legal advice based on candid discussions within the solicitor-client relationship.
• Although the relevant email strings contained a number of exchanges between departmental officials and their legal advisors, only the substantive information that qualified as solicitor client privilege was protected.

Confidential business information

• Only one document contained redactions in this category: Background notes for meeting with McKinsey and another consulting company concerning their responses to a Request for Proposals for a report on the U.S. Inflation Reduction Act.
• Disclosure of this information could reasonably prejudice the competitive position of the two companies (i.e., McKinsey and *information redacted *). Note: It should not be disclosed in committee that *information redacted* is the second company). Information of this nature, gathered at this stage in the contracting process, clearly qualifies as confidential business information.

Summary and Rationale for Redactions to CDEV Submission

Joint Finance Canada – Canada Development Investment Corporation Contract with McKinsey on the Implications of the Inflation Reduction Act – Summary and Rationale for Redactions

• In late 2022 and early 2023, Finance Canada officials collaborated with the Canada Development Investment Corporation (CDEV) on a contracted engagement with McKinsey and Company to assess the impacts of the United States' Inflation Reduction Act.
• CDEV acted as the contract authority, while the overall management of the project was jointly administered with Finance. The department largely engaged on the subject matter with McKinsey as the contract progressed, including the review of final report drafts.
• Accordingly, Finance Canada officials supported the review of CDEV's submission to the House of Commons Standing Committee on Government Operations and Estimates (OGGO) in response to its January 18, 2023, request for documents with a focus on the final report prepared by McKinsey.
• Finance identified information in McKinsey's report that falls into the following two categories of confidentiality and recommenended to CDEV that this information be protected from disclosure. This type of information is routinely redacted by federal institutions prior to disclosing records to other parties or members of the public.

Confidential Business Information of third parties

• Several sections of the report qualify as confidential business information because specific firms are identified along with information about their investment intentions. Also redacted is some of their detailed proprietary business information about project costs, cost competitiveness in the global marketplace, and other sensitive insights.
• This information could be harmful to firms' business interests and may materially benefit competitors if not protected. 

Information that could harm the economic interests of Canada

• The report contains information and analysis that continue to feed into Finance policy development. This includes the implications of the Inflation Reduction Act on Canadian industry and the competitiveness of firms in Canada and the U.S. The government's capacity to manage the economy, including securing projects of national economic significance could be at risk if this information is not protected.   
• In addition, information in this report relates to proprietary or commercial business information that is of substantial commercial value and, if released, could interfere with ongoing commercial negotiations between the government and third parties. This could, in turn, jeopardize the government's competitive position in ongoing negotiations on several projects and potentially result in economic losses to Canada.
• Information protected relates to decisions about project locations, the weighting of various incentives in investment decision-making, and information on projects associated with specific firms.

The chart below identifies the redactions that have been applied by Finance Canada officials to the McKinsey-produced final report in CDEV's package for OGGO (pages 59 through 206).