Transport Committee on May 11th, 2023

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

You were, at the same time, supplying expertise and analysts to the growth council as you were participating in meetings that had as their objective the presenting of McKinsey's prospective ability to provide the government with products and services.

[Andrew Pickersgill]

I don't think that's an accurate characterization.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

What would be an accurate characterization?

[Andrew Pickersgill]

Because there may be some confusion on the role of the growth council, I could spend a moment to describe what we did and were asked to do by the 14 members of that advisory council.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

I'm sorry. No, I don't want a filibustering of my scarce time. What I'd like to know is.... Members know I know something about that.

The issue here is that you were providing, in my understanding, advice to the growth council. You were bringing analysts to the growth council, and you were also bringing analysts to the government in what were effectively sales meetings.

In the process of facilitating those sales meetings, Mr. d'Entremont referenced your work with the growth council, so you were doing both of those things at the same time. Is that correct?

[Andrew Pickersgill]

I don't believe that's a fair characterization. McKinsey provided neutral facts and global case studies as input to a group of Canadians who were meant to make recommendations. We don't recommend policy—

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

That was the growth council.

[Andrew Pickersgill]

That's 2016. I believe you referred to—

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

You were providing information there, and Mr. d'Entremont was facilitating meetings with analysts. Is that right?

[Andrew Pickersgill]

I just want to clarify that McKinsey's role was to provide neutral facts and caselets for input to a group of individuals at the Canadian government to give advice. That was in 2016.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

That's fine, but on the other side....

You're supposed to stop my time during points of order, Chair. I have a minute left, I believe.

Could you clarify if you were providing those analysts to those pitch meetings...? Were they the same people in some cases?

[Andrew Pickersgill]

Meetings with McKinsey, and I think you're referring to 2020, were following the government rules.

In 2016, we provided neutral facts to a set of—

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

I think I have established the point, and you haven't really contradicted it.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Genuis.

Thank you, Mr. Pickersgill.

Just to clarify, Mr. Genuis, I did, indeed, stop your time during the point of order, and it was verified by the clerk, which I do for all members when there's a point of order put forward at this committee.

Next we have Mr. Chahal.

Mr. Chahal, the floor is yours. You have five minutes.

[George Chahal, Liberal, Calgary Skyview, AB]

Thank you, Chair.

Thank you to the witnesses for joining us today.

We have heard a lot of criticism from opposition members about the role of the Canada Infrastructure Bank and that it hasn't completed any projects.

Ms. McKenna, if I can go to you first and the importance of your work as the infrastructure minister, for the Province of Alberta you mentioned, in your opening remarks, that there was a large irrigation project brought forward. Can you talk about the importance of that project for Albertans and farmers, the importance of irrigation in Alberta and the impact this investment would have made and will bring forward for Albertans?

[Catherine McKenna]

Thanks. That's really a great question.

Probably it's best to put it in the words of the former premier of Alberta Jason Kenney who was a big supporter of the Canada Infrastructure Bank, even as a Conservative, because he believed in the importance of getting more infrastructure built, including in Alberta. This is a massive irrigation project. Obviously, the bank is better placed to go through the details of it.

This is what Premier Kenney said:

This historic investment in irrigation infrastructure will create thousands of jobs and support Alberta's economic recovery, while strengthening our competitive advantage. Agriculture is the beating heart of Alberta’s economy and as global demand for agri-food products continues to grow, our producers and irrigation districts will be better positioned to meet that demand for generations to come.

This is really about supporting farmers and supporting irrigation. It could not be more important.

I want to offer my.... I don't want to say condolences, but I know that there are major forest fires right now going across Alberta, so as we see with the change in climate, we're going to have to rethink things, and water irrigation is going to be incredibly important. Canada is a major agricultural producer, as is Alberta, so I think these are really important projects and a great example of an infrastructure project that will make a real difference in the lives of people, including farmers.

[George Chahal, Liberal, Calgary Skyview, AB]

Thank you for that.

I want to go to Mayor Sohi.

Mayor, thank you for joining us today.

You talked about the partnership between all levels of government and the private sector in your opening remarks. I know as mayor you have a tremendous amount of work in infrastructure requirements. I know the City of Calgary has some zero-emission buses. The City of Edmonton also has a huge investment as well.

Can you talk about the importance of that investment for the City of Edmonton and if that could have happened without the Infrastructure Bank partnering with municipalities?

[Amarjeet Sohi]

Broadly speaking, municipalities are still facing a huge infrastructure deficit. Yes, over the last number of years, in partnership with the federal government and here in the province, we are trying to close that gap, and it is being closed.

Federal investments into the Yellowhead expansion are making a difference, as are federal investments in expanding the LRT system in the city and some of the trade corridor improvements in Edmonton, again, with federal-provincial-municipal partnerships. It's very important that we continue to explore partnerships and clear the way to invest in infrastructure to close that gap.

We have an ambitious goal of electrifying the entire fleet for our public transit. That's close to 900 buses. Canada Infrastructure Bank was helpful for us to initiate that work, and we look forward to that partnership in the future. We also have a huge lead in retrofitting our old buildings to better energy standards as well as repurposing them, maybe for housing to meet that housing infrastructure gap, so I think there's a role for the Canada Infrastructure Bank to play in that area. We have huge issues with our flood mitigation because of climate change, and there have been federal investments in that area. We look forward to working with the CIB in that as well.

There's a lot of potential for municipalities to tap into the billions of dollars that are available that we don't have. As a municipality, we don't have the resources. We have a very limited borrowing capacity, so that's where we want to focus.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mayor Sohi.

Thank you, Mr. Chahal.

The next member to take the floor is Mr. Barsalou‑Duval.

Mr. Barsalou‑Duval, go ahead for two and a half minutes.

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

Thank you, Mr. Chair.

Earlier, I talked about the $9.6-million contract that was awarded by Minister Sohi when he was Minister of Infrastructure and Communities. This is the infamous contract awarded to McKinsey for nearly $10 million to develop a national infrastructure strategy.

I wanted to come back to this subject, Mr. Pickersgill and Mr. Palter, because you said earlier that your involvement in the Canada Infrastructure Bank was not the creation of the bank, even though you gave pro bono advice to the Advisory Council on Economic Growth, but that it was really limited to the three contracts that were signed with the bank. Yet my colleague Ms. Lewis said earlier, quoting a McKinsey submission, “We have a deep understanding of the CIB and the important context surrounding it. We clearly understand the objectives of the Infrastructure Bank from our work with the CIB.”

This is from a submission that was made in March 2018. So that was before the three infamous contracts that were subsequently received. So you had already worked with the CIB, if I am not mistaken. That is what the quote says, or at least what was said about it.

I'm trying to understand how you would have gotten a $10-million contract to develop a national infrastructure strategy, in which you apparently did not address the issue of the Canada Infrastructure Bank at all. This same bank received $35 billion in public funds, which is not insignificant. A $10-million contract is not a $5,000 contract, it is not a $50,000 contract, it is a very large contract. You'd have to be completely incompetent not to address that, and I don't think you are.

You certainly touched on the issue of the Canada Infrastructure Bank. So you probably forgot to tell us something earlier.

[Robert Palter]

Mr. Chair, I will confess that we have never done any work with the Department of Infrastructure Canada, so, as for the $9.6-million contract, I don't know what it refers to.

As I stated in my testimony at OGGO, McKinsey doesn't do policy work, and this would sound like policy. I'm surprised to hear that there's a contract of that nature, because we would not have taken that on in accordance with our risk management policies.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Barsalou-Duval.

Thank you, Mr. Palter.

Next, we have Mr. Bachrach.

The floor is yours. You have two and a half minutes.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Thank you, Mr. Chair.

McKinsey informed the investment criteria of the bank. We've heard that already. There are concerns about a conflation between the public interest and the private interest when it comes to the P3 model. We've heard that already. I think it makes sense to pressure test some of the assumptions and conclusions that the bank made with regard to the public interest.

My question is for Ms. McKenna.

Ehren Cory, the CEO, said about the Lake Erie connector project, “This project will allow Ontario to export its clean, non-emitting power to one of the largest power markets in the world”. As minister, did you ever see evidence that Ontario had a surplus of clean power to export?

Has she left?

[A voice]

Yes.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Can anyone else answer? Okay, I'll move onto a different question.

I'll go back to Mr. Cartwright.

Mr. Cartwright, this discussion is really about two things. It's about McKinsey's role and it's also about this balance between the public interest and the private interest. We've heard some innuendo and assertions around potential conflicts of interest and that sort of thing.

Stepping aside from that, I wonder what McKinsey's central role in the Canada Infrastructure Bank says about the balance of public and private interests in the investments.