Evidence of meeting #49 for Government Operations and Estimates in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was know.
A video is available from Parliament.
NDP
Gord Johns NDP Courtenay—Alberni, BC
It sounds like you're pretty motivated. You're getting government contracts like this off the taxpayer. It would motivate you to invest a lot in R and D, especially with the skyrocketing growth in contracts.
Conservative
The Chair Conservative Kelly McCauley
Gentlemen, I'm afraid that's our time.
Mr. Paul-Hus, welcome back to OGGO. You have five minutes, please.
Conservative
Pierre Paul-Hus Conservative Charlesbourg—Haute-Saint-Charles, QC
Thank you, Mr. Chair.
Good afternoon, Mr. Barton.
I have several questions to ask with a view to clarifying a number of points.
You were the global managing director of the McKinsey company from 2009 to 2018. The Trudeau government took over eight years ago, in 2015. From that point on, there was exponential growth in the number of contracts awarded to the company by the Government of Canada.
We would like to know how that came about.
When you were the managing director, you were no doubt involved in the relations. Even though you have said that it's not the case, Mr. Trudeau and Ms. Freeland claimed to be close friends. However, it's not unheard of to boast about being friends with certain people.
We'd like to know the nature of the discussion you had with the Trudeau government, whether with the Prime Minister, Mr. Morneau or someone else, about obtaining contracts that would get McKinsey involved in Government of Canada activities and make it a more active consulting firm.
As an Individual
As I was saying before, there is no relationship on that. I know it sounds like a good story, but there was no linkage between what I was doing and what McKinsey was doing. That's what I've been trying to explain.
Conservative
Pierre Paul-Hus Conservative Charlesbourg—Haute-Saint-Charles, QC
Are you saying that you never had any discussions with the Prime Minister of Canada or with former minister Morneau concerning services that McKinsey could provide to help with the various government departments that were encountering problems?
As an Individual
I never had those discussions. Just let me put things in perspective. McKinsey is a very large firm. The work that's going on in Canada is very small. My objective was to not have anything to do with that work. That was up to the Canadian practice. I had no interest, and I had no conversation.
Conservative
Pierre Paul-Hus Conservative Charlesbourg—Haute-Saint-Charles, QC
Rather than talk about your personal interests, let's talk about McKinsey.
What we're now wondering is what kind of advice the company was giving to foreign countries like Saudi Arabia, Russia and China.
Here in Canada, there are activities for which budgets are allocated to the departments of Citizenship and Immigration, Public Works and Government Services, National Defence, and the Canada Border Services Agency. There are problems in these four departments.
What we don't like is McKinsey developing a policy structure for the Canadian federal government and the ministers announcing a plan that seems to be coming out of nowhere. We can see that the plan came from McKinsey, but we don't know the exact contents and don't know whether the public service is able to implement it.
For example, the government tabled an immigration plan in November, in which we learned that Canada would be welcoming 500,000 newcomers as of 2025. We know that it was one of your recommendations, but the machinery doesn't appear to be able to follow through on it.
Does the usual practice involve you making recommendations to governments and them doing exactly what you suggest?
As an Individual
Mr. Chair, sir, as I said in my opening statement, we did not make policy. There were recommendations that came from the growth council to the government to decide what they wanted to do. As I said, they rejected a number of the ideas we had. That 500,000 figure did not come from the growth council. That's higher than what the growth council said—it's higher. We didn't have anything to do with policy.
The other thing I should make clear is that the growth council was 14 people. I was the chair, but all those people had input to it. There were people from civil society, and there were academics. I just want that to be clear. It's not—
Conservative
Pierre Paul-Hus Conservative Charlesbourg—Haute-Saint-Charles, QC
Let's be even clearer.
What justification can be given for the federal government to give $24 million to the McKinsey firm in connection with the citizenship and immigration department? What sorts of services or information will McKinsey be providing to the federal government for $24 million? Can you give me an example?
Conservative
Pierre Paul-Hus Conservative Charlesbourg—Haute-Saint-Charles, QC
You worked with McKinsey for 30 years. You should therefore have an idea of the sorts of recommendations…
As an Individual
You'll have McKinsey come here, which is good. Ask the team that was working on that, because I honestly have no idea. I wasn't involved.
Conservative
Pierre Paul-Hus Conservative Charlesbourg—Haute-Saint-Charles, QC
Without referring to this specific contract, can you give an example of a recommendation you would make to governments? I'm not asking for a specific example because that would involve a confidential document, but what kind of information do you give to governments? Do you design structures or ways for governments to do things?
We're trying to understand.
As an Individual
McKinsey never provides policy advice. They're executing what government wants to do. Just to give you an example, operations would be one, lean operations, anything that involves a lot of processing. It could be visas, or it could be passports. That's like running a Toyota factory, if you will. There are experts in lean manufacturing and operations. That's an area where you could be doing it.
The second one would be digitization of the business. How do you move from paper to the electronic side of things? How does that work? Those would be two examples of work that I'm familiar with in other countries. Honestly, I'm not trying to be difficult. I think you should challenge the McKinsey people.
Conservative
The Chair Conservative Kelly McCauley
I'm not trying to be difficult, but that's our time, gentlemen.
We'll have Mr. Jowhari, please, for five minutes.
Liberal
Majid Jowhari Liberal Richmond Hill, ON
Thank you, Mr. Chair.
Welcome to our committee, Mr. Barton. Let me start by once again thanking you for coming here voluntarily, as well as for the great work that you did in getting the two Michaels released and, as I now understand, for helping us with the supply chain around PPEs during a very difficult time.
Mr. Barton, quickly, in 30 seconds, can you define what the role of the managing director of a global consulting firm is?
As an Individual
A managing director's job in a global consulting firm, which basically has 2,500 partners, is basically setting strategic direction in terms of where you want the firm to be in 10 years. It is in the managing of the organization, because it's a complex organization. You have offices, you have sectors like banking, retail and so forth, and you have functions, operations and marketing. That's a complex place. Then it's making appointments, appointing people into different roles.
I also spend a lot of my time recruiting. Recruiting is a very important part of what McKinsey is and where it is, so I was often recruiting. That's the level of what you're doing. You're not in the operations.
Liberal
Majid Jowhari Liberal Richmond Hill, ON
Thank you. I appreciate that.
For the record once again, what year was it that you departed from and divested all of your shares in McKinsey?
As an Individual
I'm sorry, but then I was retiring. Everything was gone as of August 31, 2019.
Liberal
Majid Jowhari Liberal Richmond Hill, ON
Can you give us a sense of the revenue of McKinsey in 2018 and then when you fully divested in 2019?
As an Individual
We're a very confidential firm, but I could say it was $10 billion.
Liberal
Majid Jowhari Liberal Richmond Hill, ON
It was $10 billion. Do you have any idea how much revenue from Canada and specifically from the Government of Canada was generated from that?
As an Individual
Again, with all respect, I love Canada. I'm from Canada, but Canada did not move the dial anywhere.