The consulting firm McKinsey & Company has seen the amount of money it earns from federal contracts explode since Prime Minister Justin Trudeau came to power — to the point where some suggest it may have a central role in shaping Canada’s immigration policies.
A Radio-Canada investigation also learned the private consulting firm’s influence is raising concerns within the federal public service.
According to public accounts data from Public Services and Procurement Canada (PSPC), the Liberals spent 30 times more money on McKinsey’s services than Stephen Harper’s Conservatives did.
In the nine years of the Harper government, McKinsey was awarded $2.2 million in federal contracts. During Trudeau’s seven years in office, the company has received $66 million from the federal government.
McKinsey, an American firm with 30,000 consultants in 130 offices in 65 countries, provides advice to both private and public entities — which sometimes have conflicting interests — and does not disclose its business ties.
For example, Export Development Canada has paid McKinsey $7.3 million to provide various analyses since last year. The Business Development Bank of Canada paid the company $8.8 million for advice in 2021 and 2022.
Major role in immigration department
Radio-Canada’s analysis shows that Immigration, Refugees and Citizenship Canada (IRCC) has turned to McKinsey the most since 2015, with $24.5 million in contracts for management advice.
IRCC and the Canada Border Services Agency account for 44 per cent of federal compensation issued to the firm.
McKinsey refused to answer Radio-Canada questions regarding its role and agreements with the federal government. The government did not provide copies of the firm’s reports in response to Radio-Canada’s request.
McKinsey’s influence over Canadian immigration policy has grown in recent years without the public’s knowledge, according to two sources within IRCC. Both spoke on the condition of anonymity because they were not authorized to speak publicly.
Immigration, Refugees and Citizenship Canada has been McKinsey and Co.’s best customer within the federal government since 2015. (Ivanoh Demers/CBC)
Both held major roles within the department during the height of the consulting firm’s influence and spoke to Radio-Canada separately.
“It was completely opaque. We asked to collaborate, to share our ideas, but it didn’t work,” said one source with an important position within IRCC.
“McKinsey was an idea from the government. The policy was decided for civil servants. It causes a lot of operational instability,” said the second source.
“These people, these firms forget the public interest, they’re not interested in it. They’re not accountable.”
According to contracts, McKinsey was hired by IRCC to develop and implement various strategies for “transformation.”
An IRCC spokesperson said the consulting firm was tasked with reviewing, developing and implementing digital tools, processes and services.
The department spokesperson said the contract was revised during the pandemic — at an increased cost — to help IRCC respond to pressures related to the pandemic, deal with acute demand and maintain essential services for clients.
A mandate for ‘transformation’
Representatives of McKinsey facilitated or attended about 10 meetings of the IRCC transformation committee, according to documents obtained under access to information law. The documents do not include details of those presentations.
“We had a few presentations on very generic, completely vapid stuff. They arrived with nice colours, nice presentations and said they would revolutionize everything,” one of the sources said.
“In the end, we don’t have any idea what they did,” the source added, referring to “nice marketing” that “isn’t science.”
Before a federal committee hearing in late November, IRCC Deputy Minister Christiane Fox said McKinsey was involved in the transformation and modernization of the department’s systems.
“According to managers and politicians, everything that comes from outside is always better, even if we had enough resources internally,” said one department source.
“[McKinsey] always says they have great expertise, but it doesn’t make sense because we have expertise and we’re completely pushed aside,” said the other.
McKinsey head recommended immigration boost
The IRCC sources are also critical of McKinsey’s possible influence over Canada’s immigration targets.
Ottawa announced a plan this fall to welcome 500,000 new permanent residents each year by 2025, with an emphasis on fostering economic growth.
Then-Finance Minister Bill Morneau (right) looks on as Dominic Barton, chair of the Advisory Council on Economic Growth, speaks at a news conference in 2016. Morneau formed the council during his time as finance minister. (Adrian Wyld/Canadian Press)
The advisory council recommended a gradual increase in permanent immigration to 450,000 people per year to respond to labour market dynamics. At the time, Canada was accepting about 320,000 permanent residents.
John McCallum, the immigration minister at the time, expressed his reservations about the “huge figure” presented in the report.
But one of the sources at IRCC said the department was quickly told that the advisory council’s report was a foundational plan.
‘Telling truth to power’
While Dominic Barton chaired the advisory council from 2016 to 2019, he left McKinsey in July 2018 after a 30-year career with the firm. The next month, the consulting firm started its first contract with IRCC.
Trudeau named Barton Canada’s ambassador to China in 2019 — a post he held for two years before leaving and joining the mining firm Rio Tinto.
“I’m very proud of my career and time in the private sector,” Barton said. “We’re known for telling truth to power.”
Barton is also a co-founder of The Century Initiative, an advocacy group calling for policies that would bring Canada’s population to 100 million by 2100.
Dominic Barton was Canada’s ambassador to China from 2019 to 2021 after 30 years at McKinsey. (Paul Chiasson/Canadian Press)
The group was founded in 2011, while Barton was still at McKinsey, and has an current executive from the firm on its board of executives.
The Century Initiative has been listed on Canada’s lobbyist registry since 2021. It has organized meetings with the immigration minister’s office, the minister’s parliamentary secretary and Conservative and NDP MPs.
Radio-Canada’s questions to Barton about the increase in McKinsey’s contracts have not been answered.
Single-source contracts
Departments other than IRCC also have turned to McKinsey.
Public Services and Procurement Canada used the company for computer services. Innovation, Science and Economic Development Canada hired it for management advice, as well as science and research services.
The Department of National Defence also paid McKinsey several million dollars for leadership development.
Some of these contracts are still in progress and their total cost isn’t known yet.
According to Radio-Canada’s research, PSPC has called upon McKinsey on behalf of various federal entities for 18 contracts since 2021 — contracts worth more than $45 million.
All of those contracts were sole-source, according to documents obtained by Radio-Canada.
The Prime Minister’s Office referred questions to the Treasury Board Secretariat (TBS). In a statement, the TBS said external professional services bring in specific expertise and help to address fluctuations in the civil service workload.
According to TBS spokesperson Martin Potvin, such a contract could help fill shortages in certain work groups or geographic locations.
He said the decision to resort to outside firms rests with individual departments.
‘Shadow government’
Benoit Duguay, a professor at the Université de Québec à Montreal’s School of Management Services, said he’s surprised by McKinsey’s apparent influence.
“How come McKInsey has the skills to do absolutely everything a government does? … It looks like another level of government. Almost a supranational government,” Duguay said in French.
(Duguay is a former consultant himself, though not at McKinsey.)
Isabelle Fortier, professor at the École nationale d’administration publique in Quebec, said the use of firms like McKinsey suggests a break between politics and administration of the state.
She said it supplants the internal expertise of the civil service and operates as a “shadow government” without transparency or legitimacy.
The federal government said it employs consulting firms to provide high-quality services and ensure the best possible value for taxpayers. It said departments are required to award contracts in a fair, open and transparent manner.
Controversy and calls for accountability
McKinsey has advised many national governments on their COVID-19 pandemic response in recent years, including those in the U.S., U.K., Germany and Mexico.
The governments of Quebec and Ontario also hired McKinsey to advise them on their pandemic responses and plan for the economic recovery.
McKinsey and Co. was hired to provide advice to the governments of Ontario, Quebec and several countries on pandemic response and recovery. (AFP via Getty Images)
An investigation by the French Senate accused consulting firms like McKinsey of undermining national sovereignty and making the state dependent on them.
McKinsey also has been under investigation in France over tax filings, the awarding of contracts and its role in President Emmanuel Macron’s 2017 and 2022 election campaigns.
In Canada, some experts are also calling for an inquiry.
Ontario lawyer Lou Janssen Dangzalan, who has been studying IRCC’s digital reforms, said an inquiry could provide transparency on how consulting companies handle government contracts.
Fortier, who studied McKinsey’s record in France, said she supports a public inquiry into the use of consulting firms.
“We must force the black boxes to open,” she said in French.
CAPE CANAVERAL, Fla. (AP) — Three NASA astronauts whose prolonged space station mission ended with a trip to the hospital last month declined to say Friday which one of them was sick.
Astronauts Matthew Dominick, Michael Barratt and Jeanette Epps publicly discussed their spaceflight for the first time since returning from the International Space Station on Oct. 25. They spent nearly eight months in orbit, longer than expected because of all the trouble with Boeing’s Starliner crew capsule and rough weather, including Hurricane Milton.
Soon after their SpaceX capsule splashed down in the Gulf of Mexico off the Florida coast, the three were taken to a hospital in nearby Pensacola along with Russian cosmonaut Alexander Grebenkin, who launched with them back in March.
One of the Americans ended up spending the night there for an undisclosed “medical issue.” NASA declined to say who was hospitalized or why, citing medical privacy.
When asked at Friday’s news conference which one had been sick, the astronauts refused to comment. Barratt, a doctor who specializes in space medicine, declined to even describe the symptoms that the unidentified astronaut had.
“Spaceflight is still something we don’t fully understand. We’re finding things that we don’t expect sometimes. This was one of those times and we’re still piecing things together on this,” said Barratt, the only member of the crew who had flown in space before.
Epps said everyone is different in how they respond to space — and gravity.
“That’s the part that you can’t predict,” she said, adding, “Every day is better than the day before.”
Dominick said little things like sitting comfortably in a hard chair took several days to get used to once he returned. He said he didn’t use the treadmill at all during his time in space, as part of an experiment to see what equipment might be pared on a long trip to Mars. The first time he walked was when he got out of the capsule.
The two astronauts who served as test pilots for Boeing’s Starliner — Butch Wilmore and Suni Williams — will remain at the space station until February, flying back with SpaceX. Starliner returned empty in September.
___
The Associated Press Health and Science Department receives support from the Howard Hughes Medical Institute’s Science and Educational Media Group. The AP is solely responsible for all content.
COLUMBIA, S.C. (AP) — Forty-three monkeys bred for medical research that escaped a compound in South Carolina have been spotted in the woods near the site and workers are using food to try to recapture them, authorities said Friday.
The Rhesus macaques made a break for it Wednesday after an employee at the Alpha Genesis facility in Yemassee didn’t fully lock a door as she fed and checked on them, officials said.
“They are very social monkeys and they travel in groups, so when the first couple go out the door the others tend to just follow right along,” Alpha Genesis CEO Greg Westergaard told CBS News.
Westergaard said his main goal is to have the monkeys returned safely with no other problems. “I think they are having an adventure,” he said.
The monkeys on Friday were exploring the outer fence of the Alpha Genesis compound and are cooing at the monkeys inside, police said in a statement.
“The primates are exhibiting calm and playful behavior, which is a positive indication,” the police statement said, adding company workers are closely watching the monkeys while keeping their distance as they work to safely recapture them.
The monkeys are about the size of a cat. They are all females weighing about 7 pounds (3 kilograms).
Alpha Genesis, federal health officials and police all said the monkeys pose no risk to public health. The facility breeds the monkeys to sell to medical and other researchers.
“They are not infected with any disease whatsoever. They are harmless and a little skittish,” Yemassee Police Chief Gregory Alexander said Thursday.
Authorities still recommend that people who live near the compound about 1 mile (1.6 kilometers) from downtown Yemassee shut their windows and doors and call 911 if they see the monkeys. Approaching them could make them more skittish and harder to capture, officials said.
Eve Cooper, a biology professor at the University of Colorado Boulder who has studied rhesus macaques, said the animals have the potential to be dangerous and urged people to keep their distance.
Rhesus macaques monkeys can be aggressive. And some carry the herpes B virus, which can be fatal to humans, Cooper said.
However, Alpha Genesis states on its website that it specializes in pathogen-free primates. Cooper noted that there are pathogen-free populations of rhesus macaques that have been quarantined and tested.
“I would give them a wide berth,” Cooper said. “They’re unpredictable animals. And they can behave quite aggressively when they’re afraid.”
Alpha Genesis provides primates for research worldwide at its compound about 50 miles (80 kilometers) northeast of Savannah, Georgia, according to its website.
Locally, it is known as “the monkey farm.” And there is more amusement than panic around Yemassee and its population of about 1,100 just off Interstate 95 about 2 miles from Auldbrass Plantation, a Frank Lloyd Wright house designed in the 1930s.
There have been escapes before, but the monkeys haven’t caused problems, said William McCoy, who owns Lowcountry Horology, a clock and watch repair shop.
“They normally come home because that’s where the food is,” he said.
McCoy has lived in Yemassee for about two years and while he plans to stay away from the monkeys, he has his own light-hearted plan to get them back.
“I’m stocking up bananas, maybe they’ll show up,” McCoy said.
The Alpha Genesis compound is regularly inspected by federal officials.
In 2018, the U.S. Department of Agriculture fined Alpha Genesis $12,600 in part after officials said 26 primates escaped from the Yemassee facility in 2014 and an additional 19 got out in 2016.
The company’s fine was also issued because of individual monkey escapes as well as the killing of one monkey by others when it was placed in the wrong social group, according to a report from the USDA.
The group Stop Animal Exploitation Now sent a letter Thursday to the USDA asking the agency to immediately send an inspector to the Alpha Genesis facility, conduct a thorough investigation and treat them as a repeated violator. The group was involved in the 2018 fine against the company.
“The clear carelessness which allowed these 40 monkeys to escape endangered not only the safety of the animals, but also put the residents of South Carolina at risk,” wrote Michael Budkie, executive director of the group.
The USDA, which has inspected the compound 10 times since 2020, didn’t immediately respond to the letter.
The facility’s most recent federal inspection in May showed there were about 6,700 primates on site and no issues.
In a 2022 review, federal veterinarians reported two animals died when their fingers were trapped in structures and they were exposed to harsh weather. They also found cages weren’t adequately secure. Inspectors said criminal charges, civil penalties or other sanctions could follow if the problems weren’t fixed.
Since then, Alpha Genesis has undergone six inspections with minor problems reported only once.
In January 2023, the USDA said temperatures were out of the 45 to 85 degree Fahrenheit (7.2 to 29.5 degree Celsius) required range at some of the compound’s monkey cages. The inspection found moldy food in one bin, sharp edges on a gate that could cut an animal and sludge, food waste, used medical supplies, mechanical equipment, and general construction debris on the grounds.
Supporters of medical research involving nonhuman primates said they are critical to lifesaving medical advances like creating vaccines against COVID-19 because of their similarities to people. Keeping a domestic supply of the animals is critical to prevent shortages for U.S. researchers.
Humans have been using the rhesus macaque for scientific research since the late 1800s. Scientists believe that rhesus macaques and humans split from a common ancestor about 25 million years ago and share about 93% of the same DNA.
These monkeys have been launched into space on V2 rockets, used for AIDS research, had their genome mapped and made stars of their own reality television show. They were in such high demand in the early 2000s that a shortage led to scientists paying up to $10,000 per animal.
Outside of rats and mice, rhesus macaques are one of the most studied animals on the planet, said Dario Maestripieri, a behavioral scientist at the University of Chicago who wrote the 2007 book “Macachiavellian Intelligence: How Rhesus Macaques and Humans Have Conquered the World.”
The animals are very family oriented, siding with relatives when fights break out. And they’re adept at building political alliances in the face of threats from other monkeys. But they can be painful to watch. Monkeys with lower status in the hierarchy live in a constant state of fear and intimidation, Maestripieri said.
“In some ways, they kind of represent some of the worst aspects of human nature,” Maestripieri said.
___
Lovan reported from Louisville, Kentucky, and Finley reported from Norfolk, Virginia.
Finance Minister Chrystia Freeland speaks with reporters after chairing a special cabinet committee working on Canada’s plan to deal with the incoming Donald Trump administration. Freeland says she’s stood up for Canadian interests in the past and is ready to go another round. (Nov. 8, 2024)
