National Defense is the department that has deployed the company the most. It has paid McKinsey at least $34 million since 2021, a review conducted using new available data, including coroners, shows.
In particular, the firm has played a role in modernizing the Royal Canadian Navy, promoting cultural diversity in defense and the complaints management system, particularly in relation to sexual misconduct in the army.
The American company is a consulting company with 130 offices in 65 countries and employs 30,000 consultants.
Photo: McKinsey
In early January, a Radio-Canada poll showed that Liberals had spent 30 times more on McKinsey’s services than Stephen Harper’s Conservatives, who had stayed in power longer. After all, the distance is even greater.
These dozens of contracts will be the subject of a parliamentary scrutiny enforced by the opposition, in a powerful position on the Government Business and Budget Proposals Committee. Under pressure, Prime Minister Justin Trudeau also asked two ministers to review McKinsey’s contract award.
Using various financial and contract reports, we have calculated that the amounts granted by the federal government since 2015 have now passed the $100 million mark.
In a response Friday night, Public Services and Procurement Canada (PSPC), responsible for most of the federal government’s purchases, confirmed that they spent a total of $101.4 million on 23 contracts signed over the past seven years.
Lots of immature contracts
Many contracts were mutually signed by the federal government with McKinsey without a tender. This is the case, for example, with Employment and Social Development Canada, Export Development Canada, the Business Development Bank of Canada, the Canada Border Services Agency and even National Defence.
These include calls against a master’s and national standing offer, according to a statement from PSPC. This process was introduced to facilitate government departments and agencies’ access to private sector calibration services.
Ottawa believes McKinsey has exclusive rights to provide certain services in support of complex programs, including digital modernization and other key transformational initiatives.
At least $34 million for National Defense
In recent months, it has been national defense that has drawn the McKinsey firm most in, to the point where the department has spent the most money on the consulting firm’s services since Justin Trudeau came to power in 2015 came .
Since March 2021, at least 15 contracts totaling at least $34 million have been signed, either directly by the department or through Public Services and Procurement Canada (PSPC).
McKinsey served for the Royal Canadian Navy. (file photo)
Photo: The Canadian Press / Adrian Wyld
For example, McKinsey was awarded a $2 million contract to diagnose the Navy’s readiness to execute digital initiatives and another $1 million contract to develop a fleet workforce management tool that relies on artificial intelligence to manage ships who go to sea to allocate suitable and optimal crews.
McKinsey also received $4.5 million from National Defense for leadership leadership and promoting cultural change by developing a diversity, equity and inclusion framework.
According to one of the documents consulted by Radio-Canada, the goals the defense sought with these contracts were achieved.
Despite repeated reminders, the national defense did not answer our questions. As for the McKinsey company, they declined our requests for clarification, claiming that they have a habit of not commenting on our customers’ transactions.
Louise Arbor criticizes McKinsey’s interference in the administration of complaints in the army
As the Canadian Armed Forces have been rocked by multiple harassment and sexual misconduct scandals in recent years, McKinsey has helped the defense develop a modern digital complaints solution to replace the technology and datasets used.
By the summer of 2021, he had been awarded three contracts totaling six million dollars for this mandate. And the results of McKinsey’s work didn’t please former Justice Louise Arbour, the author of the report that called for the military to make sweeping changes. Louise Arbor raises multiple concerns and a doomed system.
Judge Louise Arbor filed her report on harassment and sexual misconduct with the military in May 2022.
Photo: The Canadian Press/Sean Kilpatrick
In this almost 450-page document (New window) she writes: As far as I know, McKinsey has proposed a possible new grievance mechanism […] in the form of a “single reporting window” […] for sexual misconduct, sexual harassment, hateful behavior and complaints.
“McKinsey’s proposed system is of little help when it comes to harassment and sexual misconduct. »
— A quote from the excerpt of Louise Arbour’s report, May 2022
The system proposed by McKinsey would create the same conflict of interest that exists now, she writes, speaking of significant hurdles and inadequate solutions [pour] deal with all matters related to sexual misconduct.
Following the release of this report, McKinsey was awarded a new $2 million contract last October for an update to transform the grievance process.
McKinsey has an international presence in the military sector
For several years, McKinsey has signed contracts with various governments around the world for defense or armaments consultancy. Sometimes even with competing countries or with different military interests.
According to the book When McKinsey Comes to Town, published last fall by two New York Times reporters, the firm worked with the US Department of Defense between 2018 and 2020 and also had ties to China. The American broadcaster NBC (New window) found out that McKinsey simultaneously advised a Russian arms manufacturer and the Pentagon. Earlier this year, a German newspaper (Neues Fenster) revealed that McKinsey has worked with both the German Ministry of Defense and Russian defense contractors.
A contract to analyze the potential of nuclear energy against greenhouse gases
In the winter of 2022, McKinsey was asked by Atomic Energy of Canada to provide data on the cost-competitiveness of CANDU technology and its potential role in increasing zero-emission power generation to meet greenhouse gas reduction goals. The contract cost $540,000.
Proving McKinsey can sell its consultancy across the board, the company was also recruited by Destination Canada from 2018-2021 to identify emerging global tourism trends and identify opportunities in Canada.
For nearly $3 million, the company designed a roadmap to lasting success in Canada’s tourism sector and conducted in-depth interviews with members of the industry. In addition, McKinsey analyzed the evolving impact of the COVID-19 pandemic on Canada’s tourism sector and identified potential avenues for response.
Trudeau opens the door to change
In the coming days, the Government Operations and Estimates Committee will ask the government to declassify all documents and exchanges between Ottawa and McKinsey. Several officials and ministers should be questioned.
These include the Immigration Service of Canada, which, according to our data, is the second department that has most frequently called McKinsey since Justin Trudeau came to power. Almost $25 million was spent on transforming this department.
In a press release (New Window), McKinsey Canada, after initially declining to comment on Radio-Canada’s initial investigation, said it was carrying out its work in a completely impartial manner and dismissed the idea that it was the could affect public policy, particularly in immigration.
Despite what we have recently read or heard in the media, our company makes no recommendations on immigration policy or any other issue, the company argued.
“We are proud of the work we do on behalf of the Canadian government and the programs that have been enhanced through our advice. »
— A quote from the McKinsey Canada statement
For his part, Justin Trudeau has promised to follow up to make sure we [les ententes avec McKinsey ont été faites] is the right way or if we need to modify or change the rules.
Government officials have always sought expert advice to improve service delivery to Canadians and streamline their work, he said.