Government Operations Committee on June 5th, 2023

[The Chair, Conservative, Kelly McCauley]

I call this meeting to order. Welcome to meeting number 70 of the House of Commons Standing Committee on Government Operations and Estimates.

Pursuant to the motions adopted by the committee on Wednesday, January 18, 2023, and Monday, April 24, 2023, the committee is meeting on the study of the federal government consulting contracts awarded to McKinsey & Company.

In accordance with our routine motion, I am informing the committee that all witnesses attending by video conference have completed the required connection tests in advance of the meeting.

Colleagues, we have two opening statements, and then a very short commentary by our law clerk.

Mr. Shea, I understand you're starting with an opening statement.

Please go ahead.

[Matthew Shea, Assistant Secretary to the Cabinet, Ministerial Services and Corporate Affairs and Chief Financial Officer, Privy Council Office]

Hello, Mr. Chair and members of the committee.

Thank you for inviting departmental officials, including the Privy Council Office, to provide information about the government’s response to the motion for the production of documents concerning contracts awarded to McKinsey & Company.

My name is Matthew Shea and I am the assistant secretary to the cabinet, ministerial services and corporate affairs, and chief financial officer, at the Privy Council Office.

Canadians expect and deserve value for contracts signed by the government on their behalf. The public service is committed to ensuring procurements are conducted in a fair, open and transparent manner, and in accordance with Treasury Board policies, regulations, guidelines, trade agreements and procedures.

We are also committed to accountability.

The public service understands and respects the role of Parliament to hold the government to account and is committed to providing information to parliamentarians in a transparent manner.

Across the public service, we are making best efforts to respond to the committee's request for the production of documents.

Hundreds of public servants in 20 organizations were mobilized with collecting, reviewing and translating documents, with an estimated total volume of over 220,000 pages. As many of those pages as possible were provided to this committee by February 22. Completing the remaining translation and providing all documents in both official languages is a priority.

The public service is also committed to transparency.

The long-standing approach over successive governments has been to balance the commitment to transparency with the need to protect information.

We typically take steps to protect third party information that represents a commercial sensitivity. Upon learning that McKinsey provided its material to this committee in an unredacted format, we engaged the company to lift redactions wherever possible.

The committee has and will continue to receive revised packages with minimal redactions as a result.

My colleagues joining me today will be pleased to answer questions related to the status of their departmental work.

I will now turn to the documents provided by the Privy Council Office.

The Privy Council Office issued one sole-source non-competitive contract to McKinsey in 2017 in the amount of $24,747 during the period for which the records were requested. Of the 280 pages submitted by the Privy Council Office, redactions remain in two paragraphs that relate to cabinet confidence.

Mr. Chair and members of the committee, thank you for the opportunity to provide you with this context. All of us on the panel look forward to answering your questions this afternoon.

[The Chair, Conservative, Kelly McCauley]

Thank you, Mr. Shea.

Next, we have Mr. Leduc for a two and a half minute opening statement, please.

[Michel Leduc, Senior Managing Director and Global Head, Public Affairs & Communications, Canada Pension Plan Investment Board]

Good afternoon, Mr. Chair and members of the committee.

I wish to thank the committee for inviting me.

CPP Investments is the professional investment management organization that invests the Canada pension plan funds not currently needed to pay current benefits. Our purpose is to help provide a foundation upon which more than 21 million Canadians can achieve lifetime financial security.

Our assets are segregated from government funds and managed exclusively to pay these benefits. The organization’s framework was carefully crafted to ensure we could operate without political interference.

When Canadian governments decided that a national pension fund was needed to address poverty among seniors, consent of the provinces was required. Maintaining provincial authority is deeply enshrined in the Canada pension plan, arguably the best example of co-operative federalism in Canada.

Joint stewardship between federal and provincial governments applies to how we operate. We are focused solely on fulfilling our legislative objectives in the best interests of contributors and beneficiaries. Pursuing complex investment opportunities requires significant and multi-faceted due diligence. To provide you a sense of scale, over the last five years we have carried out more than 300 investment transactions, each of which was valued at over $300 million.

Disclosing commercially sensitive material would severely undermine our ability to achieve our mission. Our success in capital markets depends on our ability to work with partners, confidentially shielded from politics and competitors. Most critically, political demands superseding our commercial activities would erode the fund's position in the most important investment markets in the world.

For example, the U.S. grants special, trusted status to CPP Investments because we are independent and behave independently. Anything that would compromise our respected commercial position would hinder our ability to access and compete in global markets. That's contrary to the best interests of Canadians relying on the CPP for their retirement.

I wish to thank the committee for this opportunity.

I will be pleased to answer your questions.

[The Chair, Conservative, Kelly McCauley]

Thank you, Mr. Leduc.

Now, for a few moments, I'm going to turn things over to Mr. Bédard, who might have an opening commentary.

[Michel Bédard, Interim Law Clerk and Parliamentary Counsel, House of Commons]

Thank you, Mr. Chair.

Thank you, members of the committee.

My name is Michel Bédard, and I am the interim law clerk and parliamentary counsel for the House of Commons.

Thank you for the opportunity to explain and clarify the right of the House and its committees to send for papers and records.

As the grand inquisitor of the nation, the House of Commons has the right to institute and conduct inquiries, as well as to send for papers and records. These rights are part of the House of Commons' privileges, immunities and powers—oftentimes referred to as parliamentary privilege—that are constitutional in nature, as they are rooted in section 18 of the Constitution Act, 1867, as well as in its preamble.

These rights, including the constitutional nature of parliamentary privilege and the fundamental role of the House of Commons and its committees, have been recognized by the Supreme Court of Canada.

There is no limit to the right of the House of Commons and of its committee to order the production of documents, providing that the documents are available in paper or electronic format and are in Canada. This power is subject only to the exceptions and limits explicitly stipulated by Parliament, the House of Commons or its committees.

That said, when they exercise that power and identify the information required for a study, committees should seek to balance their role as a major investigator for the nation with legitimate public interest considerations that can justify limiting the public communication of the requested information to committee members.

When faced with a confidentiality claim, a committee has a number of options. It can decide not to insist on the production of the information or part of the information. It can also choose to put measures in place to safeguard the confidential nature of the information, such as considering the information during in camera meetings, or it can simply maintain its original request for information and insist on the production of the documents unredacted.

Thank you. That concludes my remarks.

I will be pleased to answer questions from committee members.

[The Chair, Conservative, Kelly McCauley]

Thank you, Mr. Bédard.

We'll start with Mr. Barrett for six minutes, please.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

Thanks very much, Mr. Chair.

Mr. Shea, are you familiar with the law as it has been described by the previous speaker, by the parliamentary law clerk? A yes or no would be great.

[Matthew Shea]

I am not a legal expert.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

Okay. Are you aware of the Parliament of Canada's having constitutional power, without limit, to send for papers? Is that something that you are aware of, sir?

[Matthew Shea]

I don't think it's a simple yes or no question because—

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

In fact—

[Matthew Shea]

—there are other privacy acts and information acts that apply.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

Okay. I'm not going to waste the committee's time and have the previous speaker, the law clerk for the House of Commons, re-explain this to you. This isn't something that is political in nature, as one of the other witnesses spoke of. This has been tested by the Supreme Court of Canada. It is an absolute right, without limit, and no other rationale that has been offered by you or by the other agencies that are represented here today offers exemption from the constitutional powers of Canada's Parliament.

Can you tell me if you have been granted, if the PCO has been granted, an exemption to the Constitution?

[Matthew Shea]

Successive governments have taken the same view in terms of the production of documents to Parliament, going back to the 1973 principles governing the production of documents for Parliament. The government of the day tabled its position, explaining exactly what could and could not be tabled to parliamentary committees.

In 2010, the government of the day reviewed this and reaffirmed the same principles, which included being able to exclude things like legal advice, cabinet confidence—

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

The Supreme Court disagrees with you.

[Matthew Shea]

—privacy. The Supreme Court, in some cases—

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

I'm going to reclaim my time. Thank you very much.

Did the Prime Minister's Office direct you to have your department not comply with the order of this committee?

[Matthew Shea]

We received no such direction.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

Who coordinated the effort for you to speak on behalf of all departments about their active participation in a campaign to disregard the legal authority of Canada's Parliament to order the production of the documents that we did?

[Matthew Shea]

I would say that I'm not speaking on behalf of all departments. I simply gave an opening statement in order to maximize the time for the committee.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

It's very interesting. We often have multiple witnesses appear, and it's exceedingly rare that one would just, without discussion with the others, elect to offer opening statements on their behalf and that they would have nothing to add. That, without coordination, is extraordinary.

[Matthew Shea]

There is coordination. It was not direction. I think there's a huge difference. When we met as an ADM working group to talk about how we could best respond to this—

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

I haven't posed a question to you, sir. I haven't posed a question, but I do have a question.

[Matthew Shea]

—there was a request that I give an opening statement.