Evidence of meeting #70 for Transport, Infrastructure and Communities in the 44th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was mckinsey.
A recording is available from Parliament.
Liberal
Joanne Thompson Liberal St. John's East, NL
Thank you.
Mr. Barton, I'll just go back to you for a moment.
We've heard public-private partnerships spoken about today. Could you speak to the times when that model is appropriate versus when private investment is much more timely or appropriate, understanding that many of the investments need to happen in very short order to meet the reality of where we are in the 21st century and understanding the impact on our infrastructure of a climate crisis?
Former Global Managing Director of McKinsey & Co, As an Individual
I think public money is very important to help provide the security, if you will, or the baseline so that it's going to be long term and it's going to work. Bruno and Janice may correct me, by the way.
It's to provide the baseload to incentivize, then, the private sector to come in and say, “Okay, this is going to have the time frame we're looking at and we can actually see returns from this.” It helps to encourage it. It's much easier to invest in brownfield than in greenfield, and that's why I think—
Liberal
The Chair Liberal Peter Schiefke
Thank you very much, Mr. Barton.
We have 12 minutes left, so we'll do what we like to call a “rapid-fire round”. We'll do four minutes, four minutes, two minutes and two minutes.
We'll begin the four-minute round with Dr. Lewis.
Conservative
Leslyn Lewis Conservative Haldimand—Norfolk, ON
Thank you, Mr. Chair.
My question is for Ms. Fukakusa.
In 2018, you asked McKinsey for suggestions on hiring at the bank. On February 28, 2018, Andrew Pickersgill of McKinsey wrote an email to you with a list of McKinsey's own contractors to hire. Did you expect McKinsey to give you names of outside contractors?
Inaugural Board Chair of the Canadian Infrastructure Bank, As an Individual
No. When we were starting the bank itself, we needed to cast a very wide net on relevant, very capable people in the infrastructure field. That request was made to McKinsey and was like several requests I made across the network to get a candidate pool.
Just to emphasize that, we hired no one on the McKinsey list. In fact, when we did the actual search for our senior positions, we used a search firm. It was just to get a feel for what was there in a potential employment base.
Conservative
Garnett Genuis Conservative Sherwood Park—Fort Saskatchewan, AB
Thank you, Dr. Lewis.
Thank you, Chair.
Ms. Thompson said in her last round that she is “offended” when people “question the character” of witnesses. This might be uncomfortable for some members, but the reality is that Mr. Barton is clearly lying to this committee. We have the emails in black and white and—
Liberal
Joanne Thompson Liberal St. John's East, NL
On a point of order, I am offended when we say to a witness that they are lying. I would like you to use other language, please.
Conservative
Garnett Genuis Conservative Sherwood Park—Fort Saskatchewan, AB
On that point of order, Mr. Chair, a person being offended is not a matter of order.
Liberal
The Chair Liberal Peter Schiefke
I would like to advise all members and invite all members not to accuse any of our witnesses of lying. That is unbecoming of all members of this committee. Let's be diligent in the wording we are using.
Conservative
Garnett Genuis Conservative Sherwood Park—Fort Saskatchewan, AB
Thank you, Chair.
I would hope witnesses would be diligent in the words they use as well, in particular in the correspondence between those words and the facts.
To use sanitized language, this is a point of misinformation that is of significant consequence for this file because it seems that McKinsey was effectively able to infiltrate the government and shape decision-making on many levels and benefit from that shaping of decision-making. Mr. Barton's presence in and close relationship with the government allowed that to happen. I simply cannot square the fact that he has said in his testimony at OGGO that there was a “recusal” or a screen that prevented him from any dealings with McKinsey and that it was “excommunicado”. He repeated some of that testimony verbatim today.
It is impossible to square that with the fact that we have emails in which a partner at McKinsey is facilitating a meeting involving Mr. Barton and in the process has an intimate understanding of his schedule and availability. This is an obvious problem, and again, it is a problem of profound consequence because of the influence McKinsey has been able to exert over operational aspects of government and the significant increase we've seen in the money they've earned from government.
I'm also struck by the fact that McKinsey employees or former employees continue to come before various parliamentary committees and defend the alleged ethical track record of this company when not only do we have these problems of conflict of interest, but we have McKinsey's record in the opioid crisis and its record in assisting with the fingering of dissidents in Saudi Arabia, as well as its various other scandals throughout the world.
In the time I have left, Mr. Barton, I have one more question for you.
What other clients did McKinsey work for that have approved projects with the Infrastructure Bank?
Former Global Managing Director of McKinsey & Co, As an Individual
I'm sorry. Can you say that again? I don't understand your question.
Conservative
Garnett Genuis Conservative Sherwood Park—Fort Saskatchewan, AB
Which other McKinsey clients had approved projects with the Infrastructure Bank? McKinsey did work for the Infrastructure Bank at the same time as they were prospectively working with clients who were trying to do business with the Infrastructure Bank. Which other clients do you work for in the private sector that have approved projects with the Infrastructure Bank?
Liberal
The Chair Liberal Peter Schiefke
Unfortunately, we don't have time for that response. We're already at four minutes and 17 seconds.
Conservative
Garnett Genuis Conservative Sherwood Park—Fort Saskatchewan, AB
Mr. Barton, could you provide that in writing?
Former Global Managing Director of McKinsey & Co, As an Individual
Sure, I'd be happy to do that.
Liberal
The Chair Liberal Peter Schiefke
Thank you very much, Mr. Barton, and thank you very much, Mr. Genuis.
Next we have Ms. O'Connell.
The floor is yours, Ms. O'Connell. You have four minutes.
Liberal
Jennifer O'Connell Liberal Pickering—Uxbridge, ON
Thank you, Mr. Chair.
Mr. Genuis should read the blues from our previous meeting, where McKinsey representatives said that zero of their clients were working for or being advised on any Canada Infrastructure Bank projects. The blues will provide that testimony as well.
I want to go over a couple of points here.
When Mr. Genuis said McKinsey had a close relationship with the government, I wondered which government it was. Throughout this testimony, we saw that it was perfectly fine when then minister Flaherty and then prime minister Harper worked with and sought the advice of individuals who also worked for McKinsey. The Harper government also provided contracts with McKinsey.
Now that it's no longer a Conservative government in power, they seem to have an issue. There were 11 or 12 OGGO meetings with all the same testimony. Nothing came out of them because it was determined there was not a scandal here. The Conservatives claim to have these so-called smoking-gun emails that say—wait for it—somebody knew Mr. Barton's availability for a meeting. That's it. That's the email they have. They don't have an email about McKinsey being in the room or hosting this meeting, or about McKinsey having any involvement. They have that somebody knew Mr. Barton had availability for a certain time.
It's interesting because we as members get requests to hold meetings all the time. Our staff, I'm sure, often say—I know mine do—“Oh, she's unavailable at that time. She might be available at this time.” Two consultants—two lobbyists—tried to reach out and hold meetings with all of us. Two stakeholders.... That's the big scandal of the Conservatives after four meetings.
I find it interesting to accuse somebody of lying at this committee when the Conservatives continue to ask the same question. The same response is provided, but it's not the response the Conservatives would like; therefore it's a lie.
I think it just goes to show Canadians that this isn't really about looking at the Canada Infrastructure Bank and the McKinsey studies. This demonstrated that there were three contracts with McKinsey. Today, we heard testimony that they followed the procurement process. There were three total consultants considered. McKinsey won out. It was a total of $1.4 million. That's it. There haven't been new McKinsey contracts.
In comparison, P3 Canada was a Conservative infrastructure program. In 10 years, they had 25 projects and a total of $1.3 billion in investments. In five years, the Canada Infrastructure Bank has had 46 projects and $9.7 billion in investment, but 27 billion dollars' worth of infrastructure. Clearly, the work the board did in the restructure or rethink—or whatever you want to call it—resulted in a significant amount of infrastructure being built across this country.
Using a model to fill in the gaps.... We also heard testimony that these were some of the hardest projects to get going. We heard that 450 zero-emissions buses for the City of Brampton would have been impossible. Those were the words of Mayor Brown. It would have been impossible to do without the Canada Infrastructure Bank.
Liberal
The Chair Liberal Peter Schiefke
Thank you very much, Ms. O'Connell.
Mr. Barsalou‑Duval, you have the floor for two minutes.
Bloc
Xavier Barsalou-Duval Bloc Pierre-Boucher—Les Patriotes—Verchères, QC
Thank you very much, Mr. Chair.
It would take too long to present arguments or facts that don't fit Ms. O'Connell's statements at all, so I'll go elsewhere. I do, however, invite people to go and look at the minutes of the May 11, 2023, committee meeting, which may tell them more about McKinsey clients who may have benefited from Canada Infrastructure Bank investments.
Mr. Barton, in closing, I find it hard to believe in the randomness of McKinsey's presence at all stages of the process. So my question is going to focus on the issue of volunteerism at McKinsey.
There was a volunteer presence of McKinsey employees in support of the Advisory Council on Economic Growth when you were its chair. You said you were the chair in a personal capacity, not as McKinsey's director of global affairs. However, it was still people from McKinsey who supported the operation of the council and I'm still looking for a logical explanation for that.
When you make a staff or volunteer investment in an organization like this, I assume people have timesheets and the amounts are quantified. To take it a step further, I'd like to know if you'd be able to tell us how much it cost McKinsey. How many people were involved? What was the total value of this volunteer participation in the Advisory Council on Economic Growth?
Former Global Managing Director of McKinsey & Co, As an Individual
There are a couple of things I have to say. If you're wondering what the role was, it was to provide data at the request of growth council members. They weren't providing recommendations at all. They weren't in the room when any of the deliberations were occurring. It was agreed to up front with the Deputy Prime Minister and Minister of Finance that we were doing this, so it was all clear—
Bloc
Xavier Barsalou-Duval Bloc Pierre-Boucher—Les Patriotes—Verchères, QC
What was the value of the participation and how many people were involved, Mr. Barton? That was my question.
Former Global Managing Director of McKinsey & Co, As an Individual
I don't know. I have no idea what that was. That wasn't the point of it. It was just about getting support. No cost-benefit analysis was done. It was—
Bloc
Xavier Barsalou-Duval Bloc Pierre-Boucher—Les Patriotes—Verchères, QC
People fill out timesheets, Mr. Barton. I've worked in firms and I know how it works; there are timesheets, there are staff involved and there are budgets, too. It's not unlimited, I guess.
Former Global Managing Director of McKinsey & Co, As an Individual
You should ask Mr. Pickersgill or Rob Coulter. I have no idea what that is. It wasn't relevant.