Transport Committee on May 18th, 2023

[Janice Fukakusa]

We had McKinsey, Boston Consulting Group and PwC for the risk segment. What happened with respect to PwC is that they didn't have the scope or the capacity. What I was referring were the two that had also participated on the investment management side. I mean—

[Leslyn Lewis, Conservative, Haldimand—Norfolk, ON]

Can you...?

I'm sorry. Did you want to add something?

[Janice Fukakusa]

Yes. What I wanted to add is that, remember, the whole activity that was happening at the time—and this was right after we were established and had the board together—was about creating very good governance and infrastructure to facilitate the actual investing of the government's and our taxpayers' dollars into infrastructure. The urgency was to get all of these processes in place, so that's—

[The Chair, Liberal, Peter Schiefke]

Thank you.

I'll let you finish, Ms. Fukakusa.

[Janice Fukakusa]

The urgency was to get all of these processes in place because there was a lot of funding available, but without having proper governance around how the money was being decisioned and spent, we couldn't be positive, given the independent board we had at the time, that we were making the right decisions on behalf of Canada.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Ms. Fukakusa, and thank you, Dr. Lewis.

Mr. Iacono, you have the floor for five minutes.

[Angelo Iacono, Liberal, Alfred-Pellan, QC]

Thank you, Mr. Chair.

I'd like to thank the witnesses for being here this morning.

Mr. Barton, why didn't you suggest to the Government of Canada that it continue the P3 Canada fund?

[Dominic Barton]

That's a good question. I can't remember what the background was for it. I think the focus, we thought, was to try to encourage more private capital to come in to ensure that the projects being done would be sustainable and would be profitable, and we were concerned about subsidies. We thought that was the best approach. I think P3s are good, but that was the priority.

The other comment, as I mentioned, is that we also believed brownfield sales would be good. Where there's a utility or an operation that's already moving, do you sell part of that off to the private sector to get capital and then use the proceeds of that to invest in other infrastructure? That was kind of the line.

I think, again, Michael Sabia and Mark Wiseman would be better positioned to answer that than I am.

[Angelo Iacono, Liberal, Alfred-Pellan, QC]

Very good.

Before you made your suggestions to the government, did you study the operation of infrastructure banks elsewhere in the world to use them as a model? What exactly was your process? Could you shed some light on this for us?

[Dominic Barton]

Yes, we did. We looked.

I believe Michael Sabia spoke with—or it was Mark Wiseman; I can't remember—Infrastructure Australia. They have a number of players that have done very well, both at the state level and at the national level. We looked at the U.K. We also looked at what was happening in Europe with various similar initiatives with infrastructure banks or development banks focused on infrastructure. That was part of the process—trying to learn from that.

[Angelo Iacono, Liberal, Alfred-Pellan, QC]

Thank you. Do you feel that the Canada Infrastructure Bank has fulfilled its mandate to date? What do you think of the progress it has made over the past two years?

[Dominic Barton]

Yes, I feel very good hearing that the number is close to $30 billion. It's a real movement.

Just before this call, I was looking on the website at the number of projects being done and the range and scale of the projects. There are large and small ones across the country. I think that is very encouraging.

Personally, I hope there will be more and that we can get more private capital through there. However, $27 billion is a substantive difference. I don't know the details of them but, just in reading about them, they look very exciting.

[Angelo Iacono, Liberal, Alfred-Pellan, QC]

Thank you.

Ms. Fukakusa, did you interview or hire anyone from McKinsey to work at the Canada Infrastructure Bank?

[Janice Fukakusa]

No. When I was chair of the board, I didn't interview or hire anyone. That's—

[Angelo Iacono, Liberal, Alfred-Pellan, QC]

Thank you. Do you feel that the Canada Infrastructure Bank has fulfilled its mandate to date? What do you think of the progress it has made over the past two years?

[Janice Fukakusa]

I can't comment on that because I haven't been close to it since I left. All I can comment on is the fact that, when I left the bank, there was a significant pipeline of different projects in place, and not just in the pipeline but being examined. I thought they were off to a good start.

[Angelo Iacono, Liberal, Alfred-Pellan, QC]

Thank you very much.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Iacono.

Next we have Mr. Genuis.

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

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

Thank you, Mr. Chair.

Mr. Barton, with all due respect, you're expecting this committee to swallow quite a fudge. You're telling us you spoke all the time with Michael Sabia and it was no big deal. It was one public servant to another. He would call you and you would chat.

The core issue here is McKinsey's presence and involvement in these discussions. That's what we're asking for. That's what we need to know about.

When you were talking to, giving advice to and exchanging opinions with Michael Sabia at the time you were both public servants, what was the role of McKinsey in the context of those discussions? Should the public find it odd, or even suspicious, that the conversations between you and another public servant were being facilitated and convened by McKinsey?

[Dominic Barton]

Michael Sabia is the one who asked for the call. You have, probably, many thousands of emails to look at in order to see whether there were any other conversations. I don't have access to them. I had conversations with Michael Sabia when he asked.

He wasn't a public servant during this time. I believe he was at the Munk School. I can't recall correctly. He would call to ask for views on things, and that's exactly how I took it. I didn't see that at all as having anything to do with McKinsey. It was Michael Sabia asking for—

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

Okay. That is what you said before.

If I can drill down here, was McKinsey present for or involved in any of the discussions, formal or informal, that happened between you and Michael Sabia during the time you were Canada's ambassador to China?

[Dominic Barton]

I had many conversations with Michael, and they were not related to or had anything to do with.... Talk wasn't just on the Infrastructure Bank. For the one conversation here, all I recall is speaking with Michael Sabia, and Mark Wiseman being on there. It was a phone line. I didn't see who was in the room. As far as I was concerned, it was a request from Michael Sabia to get input. That's how I saw it and—

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

Thank you, sir. You've said this before.

Was McKinsey on the line or participating in any of these conversations?

[Dominic Barton]

There was one conversation, which apparently there's an email about. I was not aware McKinsey was in that. What I was aware of was that Michael Sabia had asked for a call, and I took it. Again, I couldn't be there the whole time. I wasn't there at the beginning. I joined in the last 30 minutes—

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

This is the June 23 one.