Evidence of meeting #59 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 work.
A video is available from Parliament.
Liberal
Anthony Housefather Liberal Mount Royal, QC
So, you weren't desperately seeking the business of the Government of Canada. This was not something that McKinsey sought as a number one priority, I would imagine.
Senior Partner, McKinsey & Company
No. We took on the work because many of our junior folks are inspired to try to make Canada a better place. They want to take the skills and capabilities they've learned at McKinsey and bring them to the civil service to make Canada a better place for everybody.
Liberal
Anthony Housefather Liberal Mount Royal, QC
We've been talking a little bit about the preliminary audit results, which, again, are the audit results on the government side, not the McKinsey side. We saw things like, for example, files that did not keep the signatories of the contract on both sides. They only had one of the signatories in the government file, or there were statements of work that were incomplete.
Did the Government of Canada ever send a notice of default to McKinsey under any one of these agreements?
Liberal
Anthony Housefather Liberal Mount Royal, QC
Presumably, the civil servants who awarded the contracts and who determined that outsourcing was required in those cases, because the audits made it very clear there was no political interference, would have determined if they saw deficiencies in the work that McKinsey was doing under the contract and would have sent notices of default.
You're saying that nobody ever got a notice of default and that McKinsey is not aware of any breach of any of these contracts that it ever had.
Liberal
Anthony Housefather Liberal Mount Royal, QC
Okay, perfect.
Let's go back to compliance.
My understanding is that you have a chief compliance officer based in Texas. Is there a worldwide compliance policy, or do you also have a compliance person in Canada who reports to the person in Texas and deals with compliance in Canada?
Senior Partner, McKinsey & Company
We have global compliance and Canadian compliance. It's a global function, but we do have Canadian representation. We have specifically dedicated lawyers, risk managers, contract managers, systems, policies, procedures, checks and balances for Canada.
Liberal
Anthony Housefather Liberal Mount Royal, QC
Presumably, you have that around the world, as well. When you see that there are issues, such as allegations related to opioids in the United States and allegations in South Africa, McKinsey's compliance department, number one, validates whether laws were followed or not and, number two, changes policies in the event that they see there are breaches or deficiencies. Is that correct?
Senior Partner, McKinsey & Company
Yes. McKinsey takes the compliance with all laws, every law, very, very seriously, and we have the people, the tools, the systems and the processes to ensure that we're complying.
Liberal
Anthony Housefather Liberal Mount Royal, QC
When you enter into settlement agreements, for example, it costs McKinsey and partners money, so there would be a goal, presumably, not to further need to enter into settlement agreements and cost the company money. Not only from an ethical standard in terms of improvement but also from a purely financial standpoint, you would want to make sure that you are in full compliance. Is that correct?
Liberal
Anthony Housefather Liberal Mount Royal, QC
No, I'm good.
I just want to thank Mr. Palter for being here.
Conservative
The Chair Conservative Kelly McCauley
Thank you, Mr. Housefather.
Mr. Palter, thank you for joining us today. We appreciate your time.
Colleagues, we're going to suspend for a minute or two.
Mr. Palter, we'll excuse you and your colleagues. Again, thank you for joining us.
Colleagues, we're suspended.
Conservative
The Chair Conservative Kelly McCauley
Colleagues, we are unsuspended.
I'm going to turn things over to Ryan for a couple of minutes. He's going to walk us through his report that we asked for.
Sir, the floor is yours.
Ryan van den Berg Committee Researcher
Thank you, Mr. Chair.
Members will have received yesterday a document from the Library of Parliament that outlines the status of the documents that were ordered by the committee pursuant to the motion of January 18. In that motion, they had requested documents from both McKinsey and federal organizations that had contracted with McKinsey. The report you have focuses on the degree of redactions that were made to those documents.
As we have outlined here, McKinsey has since sent us 91,000 pages of documents. Those were since sent unredacted.
It also describes that there were 20 federal organizations that have sent documentation to the committee, most of which have sent that in redacted form. I think there were 16 in redacted form and four in unredacted form, as well as one that declined to send information. There is an illustrative table at the end of the report that illustrates the extent of the redactions that were made to those documents.
I will leave it there, but if members have questions, they can feel free to ask Diana and me.
Conservative
The Chair Conservative Kelly McCauley
I have started a list. I have Mr. Barrett, Mr. Godin and Mrs. Vignola who want to chat on it.
Go ahead, Mr. Barrett.
Conservative
Michael Barrett Conservative Leeds—Grenville—Thousand Islands and Rideau Lakes, ON
Thanks, Chair.
Thanks to our analysts—
Conservative
The Chair Conservative Kelly McCauley
Oh, I do apologize. I'll interrupt you for a moment.
Thank you, analysts, for that.
Conservative
Michael Barrett Conservative Leeds—Grenville—Thousand Islands and Rideau Lakes, ON
You didn't like that I cut your grass there, Chair.
Conservative
Michael Barrett Conservative Leeds—Grenville—Thousand Islands and Rideau Lakes, ON
Thanks very much for turning this around for us.
This is good, but I think it's important, based on this report, that we do inform the House. Until we do that, the House is unaware that this has occurred.
I would like to amend or add to the end of the report. I will read two quick lines into the record:
The right to institute inquiries and demand papers is one of the privileges of the House of Commons as a collectivity.
Accordingly, the committee wishes to draw the attention of the House to what appears to be a breach of its privileges and/or a possible case of contempt of Parliament and recommends the House to take measures it deems appropriate.
That's the addition I would like to make.
This wording, although I would like to tell you that I just wrote it up now, Chair, is lifted from similar reports that have gone from committees to the House with respect to similar breaches of privileges with respect to requests or orders for production of documents. I think it would be appropriate to include it here.