CBSA issues: Standing Committee on Government Operations and Estimates—Study on Federal Government Consulting Contracts Awarded to McKinsey & Company (June 5, 2023)
Key messages
1. The CBSA operates in a complex and ever-changing environment. As other large organizations do, we seek outside expertise from time to time to fill knowledge gaps or to complement our own efforts.
2. The CBSA has strived to ensure consistency between information that third parties have agreed to disclose to the committee and information disclosed by the agency. The revised submission made by the CBSA to this committee is as transparent as the agency can be while providing protections on certain information that the federal public service has a legal obligation to maintain. This approach is in line with the principles of Open and Accountable Government, the conventions of which have been upheld by the federal public service under successive governments.
Initial submission and timelines
3. Given the limited time to respond to the request, the volume of materials to translate, the finite number of available translation service providers and the committee's instructions not to employ a multi-tranche submission approach, the CBSA employed best efforts with the resources available to deliver on .
4. The CBSA respects the role of Parliament to hold the Government to account, and is committed to providing information to parliamentarians in a transparent manner.
5. Redactions remain to protect certain information, like personal information where there isn't consent to release, or Solicitor Client Privilege. The longstanding approach over successive governments has been to balance the commitment to transparency with the need to protect information where the public service has an obligation not to disclose.
Questions and answers
What were the reasons for redactions made to the agency's materials submitted to the committee on ?
From the outset, the approach taken by the agency has been consistent with the longstanding approach over successive governments to balance the commitment to transparency with the need to protect information where the public service has an obligation not to disclose.
We are guided in this regard by obligations found in law, including, but not only, the Privacy Act and Access to Information Act.
How many of the redactions made to the agency's production of materials will be lifted in its pending re-submission?
Following McKinsey & Company's agreement to re-submit its documents to the Standing Committee on Government Operations and Estimates without redactions, the CBSA engaged McKinsey & Company, as well as a company that failed in a bid, to seek consent to lift the redactions. Some redactions will remain that relate to the information of other third Parties for which consent has not been granted, vulnerability of infrastructure, Cabinet confidence and the personal information of individuals that does not relate to the position or functions of a government employee or an individual performing services under contract.
Why was McKinsey & Company not consulted on redactions prior to the agency's production of documents on ?
In addition to the CBSA there were 19 other federal Departments and Agencies compelled to produce documents related to contracts with McKinsey & Company. Additionally, McKinsey & Company themselves were also compelled to produce thousands of pages of material. There was insufficient time for all 20 Departments and Agencies to effectively engage with McKinsey & Company between the date of the motion, , and the deadline to submit materials, .
How much did the Canada Border Services Agency spend to translate the materials submitted to the committee on ?
The CBSA's total expenditures in responding to the committee's request are in the order of just under $150,000.
Why was McKinsey & Company not required to deliver products in both languages?
The deliverables requested under McKinsey contracts, were requested in English. Where translation was required, the agency would have undertaken the translation.
Why is the CBSA re-submitting its material to the committee and when will this be done?
The CBSA finalized its new translations, re-assembled its disclosure of documents with certain redactions lifted, and re-submitted its revised package to the committee on . This revised submission is slightly over 4,000 pages (English and French combined).
What personal information is exempt from disclosure under the Privacy Act?
Personal information
Guided by the relevant sections of the Privacy Act, the CBSA released information pertaining to CBSA employees, that pertains to their duties or functions, and information pertaining to McKinsey employees relating to the services performed under contract. The CBSA withheld the personal information of employees pertaining to leave and the personal information of McKinsey employees not related to the services performed such as personal contact information and security screening information.
Following consultation with McKinsey, the CBSA is now providing additional personal information of McKinsey employees, whether or not they provided services under contract, where the CBSA is aware that there is no longer a reasonable expectation of privacy, such as information pertaining to their contact information and employment with McKinsey.
Examples of information that continues to be redacted:
- CBSA employee personal leave
- McKinsey employee personal information:
- Education
- Language
- Date of birth
- Security clearance
- Completed security clearance form
What type of third party information is exempt from disclosure under the Access to Information Act?
Third party information: Section 20 of the Access to Information Act
Subject to this section, the head of a government institution shall refuse to disclose any record requested under this Part that contains financial, commercial, scientific or technical information that is confidential information supplied to a government institution by a third party and is treated consistently in a confidential manner by the third party.
Following consultation with McKinsey, the CBSAs is no longer protecting any confidential information of McKinsey. However, following our consultation with the other third party, the CBSA is maintaining the redactions relating to the identity of the failed bidder.
Examples of information that continues to be redacted:
- Identity of the company that failed the bid
- Failed bid regret letter
- Uncompleted failed bid evaluation grid
What infrastructure information is exempt from disclosure under the Access to Information Act?
Vulnerability of infrastructure: Paragraph 16(2) of the Access to Information Act
The head of a government institution may refuse to disclose any record requested under this Part that contains information that could reasonably be expected to facilitate the commission of an offence, including, without restricting the generality of the foregoing, any such information on the vulnerability of particular buildings or other structures or systems, including computer or communication systems, or methods employed to protect such buildings or other structures or systems.
CBSA internal links:
The release of the information reveals the structure of the CBSA internal networks. The release of the information would assist individuals in reducing the time it would take to compromise information on our networks once they have gained entry, thereby facilitating the commission of an offence.
Does the Access to Information Act, section 69 apply to the confidences of the King's Privy Council for Canada?
The Access to Information Act does not apply to confidences of the King's Privy Council for Canada, including records that would reveal the contents of any Cabinet Confidence. Prior to the initial package provided to the committee, the CBSA consulted with the Department of Justice and confirmed the existence of cabinet material and removed the information from its disclosure.
How much information will remain redacted?
- A little over 3.5% of the content of the package is redacted in the final submission to the committee
- Personal Information: 93 pages with redactions with an average of 62.9% of the information on those pages redacted, representing 3.26% of the information in the total package
- Third party Information: 22 pages with redactions with an average of 5.7% of the information on those pages redacted, representing 0.07% of the information in the total package
- Vulnerability of systems: 35 pages with redactions with an average of 6.57% of the information on those pages redacted, representing 0.13% of the information in the total package
- Cabinet Confidences: 15 pages with redactions with an average of 16% of the information those pages redacted, representing 0.13% of the information in the total package
- Total: 161 pages with redactions with an average of 39% of the information those pages redacted, representing 3.59% of the information in the total package
McKinsey contract matrix
| Purpose | Business Consulting/Change Management Services contract that resulted in Business Case for CARM |
|---|---|
| Contract period | Award date: End date: |
| $ Value / Spent (dollars) | Contract value: $1.99 million Amount spent: $1.8 million |
| Notes | CBSA received a benefits framework to measure the effectiveness and efficiency of adopting digital processes to improve Revenue Management of Duties and Taxes on imported goods. |
| Additional information | 1) What advice did the CBSA follow from McKinsey as a result of this contract? 2) Why were external resources required to accomplish this work? |
| Purpose | Contract for Executive Transformation Services |
|---|---|
| Contract period | Award date: End date: |
| $ Value / Spent (dollars) | Initial contract value: $791,000 Amended contract value: $1.8 million Amount spent: $1.6 million |
| Notes | Executive Transformation Services to maximize the potential benefits of multiple transformation initiatives underway at the CBSA as well as to provide guidance toward the development of a Renewal Strategy and potential implementation. |
| Additional information | 1) What advice did the CBSA follow from McKinsey as a result of this contract? 2) Why were external resources required to accomplish this work? |
| Purpose | Contract for value (vendor) management work plan |
|---|---|
| Contract period | Award date: End date: |
| $ Value / Spent (dollars) | Contract value: $1.33 million Amount spent: $978,000 |
| Notes | Establishment of a Value Management Office strategy and work plan to support the CARM project. |
| Additional information | 1) What advice did the CBSA follow from McKinsey as a result of this contract? 2) Why were external resources required to accomplish this work? |
| Purpose | Benchmarking contract that was canceled before any work completed |
|---|---|
| Contract period | Award date: Initial end date: Amended date: Contract ended with no expenditures |
| $ Value / Spent (dollars) | Contract value: $1.98 million Amount spent: $0 |
| Notes | Establishment of benchmarking services for the CARM project. This contract was canceled without expenditures after it was determined that the work would be completed with in-house resources. |
| Additional information | 1) What advice did the CBSA follow from McKinsey as a result of this contract? 2) Why were external resources required to accomplish this work? |
McKinsey consult letter
Robert Palter
Senior Partner
McKinsey Consulting
110 Charles Street West
Toronto, ON M5S 1K9
Our File:
AV-2023-05134
Dear Robert Palter:
As you may be aware, the Parliamentary Standing Committee on Government Operations and Estimates (the committee) is undertaking a study of federal government consulting contracts awarded to McKinsey & Company. As part of this study, the committee has ordered the Canada Border Services Agency (the CBSA) to provide all records pertaining to the awarding of contracts to McKinsey & Company.
As part of its production of records, the CBSA provided the committee with a partial disclosure of the requested information in accordance with the legislative framework provided by the Access to Information Act (the act), which contained records that pertain to your organization. In accordance with the principles of the act, portions of the records were redacted pursuant to sections 19 (Personal Information) and 20 (Third Party Information) of the act. The CBSA applied section 20 of the act to redact portions of the records that we believed would result in injury to McKinsey & Company if they were to be made public, and applied section 19 of the act to the personal information of McKinsey & Company employees.
The committee has requested a full disclosure, without redaction, of our initial production of records referenced above. In keeping with the principles of the legislative framework provided by the act, we are requesting that McKinsey & Company undertake a review of the records and that McKinsey & Company inform us should it oppose the disclosure of any part of the attached records that the CBSA withheld in its initial disclosure to the committee. We are seeking your representations only on the redacted portions, which have been highlighted in grey for ease of reference.
If you oppose the disclosure of the highlighted information contained in the attached records, we ask that you submit written representations within 20 days of receipt of this letter and provide sufficient reasons as to why this information should not be disclosed pursuant to paragraph 20. If you have not contacted the CBSA within the 20-day period, the CBSA will provide the committee with a full disclosure of all records previously redacted.
In order to justify the withholding of information under these paragraphs, it is necessary to describe the specific injury that would result from disclosure of the information. Since the courts have rejected the notion of vague general harm, the description of the injury as described in these provisions of the act must include specifics as to the probability and foreseeable impact of disclosure on your current operations.
If you intend to oppose the disclosure, I would also like to draw your attention to section 25 of the act, which establishes the principle of reasonable severability. This means that a record containing information that may be exempt should not be exempted from access as a whole if the exempt information can be severed from the record and the remainder of the record disclosed.
Copies of sections 20, 25, 27 and 28 of the act are enclosed for your information.
Additionally, we have enclosed a list of McKinsey & Company employees for which the CBSA redacted their personal information. As part of our review of the redacted records, the CBSA would like to consult directly with all affected individuals. We would be grateful if McKinsey & Company could provide us with the contact information for the individuals on the enclosed list. Note that the CBSA intends to continue to protect the personal information contained in the records unless the affected individual expressly consents to the disclosure.
Should you have any questions, or wish to discuss any part of this letter, please do not hesitate to contact Neil O'Brien, A/Director, ATIP Case Management, at 343-998-6163 or neil.obrien@cbsa-asfc.gc.ca.
Yours truly,
Dan Proulx
Director General and Chief Privacy Officer
Information Sharing, Access to Information and Chief Privacy Office
Place Vanier Tower A
333 North River Road, 14th floor
Ottawa, ON K1A 0L8
Enclosures: Sections 20, 25, 27 and 28 of the act
Consultation documentation
Sections 20, 25, 27 and 28 of the act
Third party information
20. (1) Subject to this section, the head of a government institution shall refuse to disclose any record requested under this act that contains
(a) trade secrets of a third party;
(b) financial, commercial, scientific or technical information that is confidential information supplied to a government institution by a third party and is treated consistently in a confidential manner by the third party;
(b.1) information that is supplied in confidence to a government institution by a third party for the preparation, maintenance, testing or implementation by the government institution of emergency management plans within the meaning of section 2 of the Emergency Management Act and that concerns the vulnerability of the third party's buildings or other structures, its networks or systems, including its computer or communications networks or systems, or the methods used to protect any of those buildings, structures, networks or systems;
(c) information the disclosure of which could reasonably be expected to result in material financial loss or gain to, or could reasonably be expected to prejudice the competitive position of, a third party; or
(d) information the disclosure of which could reasonably be expected to interfere with contractual or other negotiations of a third party.
Product or environmental testing
(2) The head of a government institution shall not, pursuant to subsection (1), refuse to disclose a part of a record if that part contains the results of product or environmental testing carried out by or on behalf of a government institution unless the testing was done as a service to a person, a group of persons or an organization other than a government institution and for a fee.
Methods used in testing
(3) Where the head of a government institution discloses a record requested under this act, or a part thereof, that contains the results of product or environmental testing, the head of the institution shall at the same time as the record or part thereof is disclosed provide the person who requested the record with a written explanation of the methods used in conducting the tests.
Preliminary testing
(4) For the purposes of this section, the results of product or environmental testing do not include the results of preliminary testing conducted for the purpose of developing methods of testing.
Disclosure if a supplier consents
(5) The head of a government institution may disclose any record that contains information described in subsection (1) with the consent of the third party to whom the information relates.
Disclosure authorized if in public interest
(6) The head of a government institution may disclose all or part of a record requested under this act that contains information described in any of paragraphs (1)(b) to (d) if
(a) the disclosure would be in the public interest as it relates to public health, public safety or protection of the environment; and
(b) the public interest in disclosure clearly outweighs in importance any financial loss or gain to a third party, any prejudice to the security of its structures, networks or systems, any prejudice to its competitive position or any interference with its contractual or other negotiations.
R.S., 1985, c. A-1, s. 20; 2007, c. 15, s. 8.
Severability
25. Notwithstanding any other provision of this act, where a request is made to a government institution for access to a record that the head of the institution is authorized to refuse to disclose under this act by reason of information or other material contained in the record, the head of the institution shall disclose any part of the record that does not contain, and can reasonably be severed from any part that contains, any such information or material.
1980-81-82-83, c. 111, Sch. I "25".
Notice to third parties
27. (1) If the head of a government institution intends to disclose a record requested under this act that contains or that the head has reason to believe might contain trade secrets of a third party, information described in paragraph 20(1)(b) or (b.1) that was supplied by a third party, or information the disclosure of which the head can reasonably foresee might effect a result described in paragraph 20(1)(c) or (d) in respect of a third party, the head shall make every reasonable effort to give the third party written notice of the request and of the head's intention to disclose within 30 days after the request is received.
Waiver of notice
(2) Any third party to whom a notice is required to be given under subsection (1) in respect of an intended disclosure may waive the requirement, and where the third party has consented to the disclosure the third party shall be deemed to have waived the requirement.
Contents of notice
(3) A notice given under subsection (1) shall include
(a) a statement that the head of the government institution giving the notice intends to release a record or a part thereof that might contain material or information described in subsection (1);
(b) a description of the contents of the record or part thereof that, as the case may be, belong to, were supplied by or relate to the third party to whom the notice is given; and
(c) a statement that the third party may, within twenty days after the notice is given, make representations to the head of the government institution that has control of the record as to why the record or part thereof should not be disclosed.
Extension of time limit
(4) The head of a government institution may extend the time limit set out in subsection (1) in respect of a request under this act where the time limit set out in section 7 is extended under paragraph 9(1)(a) or (b) in respect of the same request, but any extension under this subsection shall be for a period no longer than the period of the extension under section 9.
R.S., 1985, c. A-1, s. 27; 2007, c. 15, s. 9.
Representations of third party and decision
28. (1) Where a notice is given by the head of a government institution under subsection 27(1) to a third party in respect of a record or a part thereof,
(a) the third party shall, within twenty days after the notice is given, be given the opportunity to make representations to the head of the institution as to why the record or the part thereof should not be disclosed; and
(b) the head of the institution shall, within thirty days after the notice is given, if the third party has been given an opportunity to make representations under paragraph (a), make a decision as to whether or not to disclose the record or the part thereof and give written notice of the decision to the third party.
Representations to be made in writing
(2) Representations made by a third party under paragraph (1)(a) shall be made in writing unless the head of the government institution concerned waives that requirement, in which case they may be made orally.
Contents of notice of decision to disclose
(3) A notice given under paragraph (1)(b) of a decision to disclose a record requested under this act or a part thereof shall include
(a) a statement that the third party to whom the notice is given is entitled to request a review of the decision under section 44 within twenty days after the notice is given; and
(b) a statement that the person who requested access to the record will be given access thereto or to the part thereof unless, within twenty days after the notice is given, a review of the decision is requested under section 44.
Disclosure of record
(4) Where, pursuant to paragraph (1)(b), the head of a government institution decides to disclose a record requested under this act or a part thereof, the head of the institution shall give the person who made the request access to the record or the part thereof forthwith on completion of twenty days after a notice is given under that paragraph, unless a review of the decision is requested under section 44.
1980-81-82-83, c. 111, Sch. I "28".
Copies of the motions
The motion reads as follows:
That the committee undertake a study, pursuant to Standing Orders 108(3)(c)(iii) and (ix), regarding government consulting contracts awarded to McKinsey & Company by the Government of Canada, or any Crown corporation, since , examining their effectiveness, management and operation, including the value and service received by the government, provided that:
(a) the committee schedule meetings to receive witness testimony (i) the President of the Treasury Board, the Minister of Public Services and Procurement and the Deputy Prime Minister, Minister of Finance, Minister of National Defence, Minister of Immigration, Refugees and Citizenship, Minister of Health, and Minister of Public Safety each be invited to appear for an opening statement and at least three full rounds of questions, (ii) the most senior executives at McKinsey & Company in Canada, Dominic Barton, and any other witnesses the committee decides be invited to appear, and (iii) the parties shall each provide to the clerk of the committee, by 3:00 pm EST on Tuesday, , their preliminary lists of other witnesses who the Chair shall schedule in a manner fair to all parties;
(b) the committee report forthwith to the House that it recommends that the Auditor General be called upon to conduct, as soon as possible, a performance and value for money audit of the contracts awarded to McKinsey & Company since , by any department, agency or Crown corporation;
(c) the committee order each department, agency or Crown corporation which entered into a contract (including a memorandum of understanding or other agreement) with McKinsey & Company since , to provide the clerk of the committee in both official languages within five weeks of the adoption of this order, as they become available, and notwithstanding any non-disclosure agreements which might be applicable, copies of
(i) requests for tenders or other procurement requests related to contracts awarded to McKinsey & Company,
(ii) tenders, bids, proposals or other applications received in respect of those procurement requests,
(iii) contracts entered into, including any amendments thereto,
(iv) all correspondence and electronic communications including emails, text messages, message app communications, and handwritten notes pertaining to these contracts,
(v) statements of work performed by McKinsey & Company under each contract,
(vi) all work product provided by McKinsey & Company under each contract,
(vii) invoices provided by McKinsey & Company,
(viii) records of all payments made to McKinsey & Company,
(ix) the hourly and or daily rates McKinsey & Company charged for each employee working on all respective contracts the company has received since , and
(x) the names of project managers and or project authorities from McKinsey & Company on all respective contracts and projects the company received since ;
(d) the committee order McKinsey & Company to provide, to the clerk of the committee within three weeks of the adoption of this order, and notwithstanding any non-disclosure agreements which might be applicable, with respect to each contract entered into with a department, agency or Crown corporation of the Government of Canada since , copies of (i) all records referred to in paragraph (c), (ii) all records concerning the details and descriptions of work performed under each contract, (iii) timesheets documenting work done for each respective contract, (iv) the hourly and or daily rates McKinsey & Company charged to the government or crown corporation for each respective contract awarded to them since 2011, (v) the names of project managers and or project authorities from McKinsey & Company assigned to each project from a contract with the government or crown corporation since , (vi) all records concerning subcontracts issued by McKinsey & Company in relation to each contract, including tenders, contracts, or memoranda of understanding (including any amendments thereto), invoices, payments and evaluations, (vii) all correspondence and electronic communications including emails, text messages, message app communications, and handwritten notes pertaining to these contracts, and (viii) the complete client list of all organizations McKinsey & Company has worked with since ;
(e) the evidence and documents received as part of this study be also considered in the committee's study on the outsourcing of contracts.
Michael Barrett moved, that the committee:
a) Invite the deputy heads from the following entities in relation to the redactions and improper translation of documents requested by the committee on :
- Atomic Energy of Canada Limited
- Business Development Bank of Canada
- Canada Border Services Agency
- Canada Development Investment Corporation
- Canada Post
- Canada Pension Plan Investment Board
- Department of Finance Canada
- Employment and Social Development Canada
- Export Development Canada
- Immigration, Refugees and Citizenship Canada
- Innovation, Science and Economic Development Canada
- National Defence
- Natural Resources Canada
- Office of the Veterans Ombud (Veterans Affairs Canada)
- Privy Council Office
- Public Sector Pension Investment Board
- TransMountain Corporation
b) Invite the Office of the Law Clerk to brief the committee, in public, on the extent of the committee's powers to call for documents;
c) Instruct the Chair to send a letter to each of the entities listed in section a) of this motion to inform them that the committee is currently considering referring this issue to the House of Commons as a possible breach of parliamentary privilege.
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