Advertisement
Canada markets close in 1 hour 20 minutes
  • S&P/TSX

    21,867.02
    -144.70 (-0.66%)
     
  • S&P 500

    5,065.42
    -5.13 (-0.10%)
     
  • DOW

    38,457.79
    -45.90 (-0.12%)
     
  • CAD/USD

    0.7295
    -0.0025 (-0.34%)
     
  • CRUDE OIL

    82.87
    -0.49 (-0.59%)
     
  • Bitcoin CAD

    88,662.69
    -2,836.39 (-3.10%)
     
  • CMC Crypto 200

    1,397.83
    -26.27 (-1.84%)
     
  • GOLD FUTURES

    2,334.80
    -7.30 (-0.31%)
     
  • RUSSELL 2000

    1,991.54
    -11.11 (-0.55%)
     
  • 10-Yr Bond

    4.6600
    +0.0620 (+1.35%)
     
  • NASDAQ

    15,686.89
    -9.75 (-0.06%)
     
  • VOLATILITY

    15.96
    +0.27 (+1.72%)
     
  • FTSE

    8,040.38
    -4.43 (-0.06%)
     
  • NIKKEI 225

    38,460.08
    +907.92 (+2.42%)
     
  • CAD/EUR

    0.6822
    -0.0014 (-0.20%)
     

William Watson: At least McKinsey doesn’t go on strike

SWITZERLAND-US-FRANCE-MCKINSEY-BUSINESS-CONSULTANCY-COMPANY
SWITZERLAND-US-FRANCE-MCKINSEY-BUSINESS-CONSULTANCY-COMPANY

To govern is to choose, former Quebec premier Robert Bourassa was fond of saying. But that’s so 20th-century. These days, to govern is to choose everything.

I just downloaded the “Inventory of federal organizations and interests” on Ottawa’s “Open Government” website. As you would imagine, it wasn’t a flawless procedure. The resulting spreadsheet is a little chaotic, with columns wandering into each other. But I did manage to glean from the “OrgID” column that the orgID’s go from one to 561, which is a lot of org’s. No wonder they sometimes seem a little distracted in Ottawa. They’re trying to do so much!

I also recently checked the Public Accounts of Canada, vol iii, section vi: Transfer payments. These are all the cheques Ottawa writes to individual organizations. It’s not easy to read. Very small font. Around 60 lines per page. Only listing payments over $100,000, though the existence of payments under $100,000 is noted: on the very first page there are more than 15,000 of those. Total pages: 369. Is there anyone in Canada, me excepted, probably you too, who isn’t getting a grant from the federal government?

ADVERTISEMENT

The section of the accounts that reporters have been scouring lately is number iii: “professional and social services,” where the most-searched name in the last couple of weeks has been “McKinsey,” the consulting firm that has done a lot of work for the current federal government (though only four items in section three last year, totalling just $26.3 million).

The media are suffering McKinsey-derangement syndrome. Yes, if there were cozy deals because the prime minister and former McKinsey chairman and later our ambassador to China Dominic Barton are buddies — or because ambitious cabinet ministers knew they were buddies and wanted to get on the boss’s good side — then that needs to be looked into. But if I were a cabinet minister, I would really, really want to have the ability to go outside my department and even the government for advice — or for whatever McKinsey or other private agencies can provide.

There might be entrenched interests I’d like to get around. I may not want to have to train up my existing bureaucrats to do what could turn out to be a one-time job. I may not want to have to hire new permanent people, pay them government wages with government benefits and indexed government pensions to do a job that an outside agency can do cheaper, better, faster and without anyone going on strike. McKinsey’s people may actually show up at my office, rather than insist on working from home. And so on.

In stories about the Public Service Alliance of Canada seeking a strike mandate from its members, as it’s about to do, one of the 100 items (Lord help us!) said to be on the table is an end to contracting-out and privatization. Everybody loves being a monopolist. What better route to a quiet, well-paid life. But ministers should resist hard before giving in on that one. Yes, there’s a natural populist animus against perceived insiders like McKinsey. But being able to go outside for services is a way to keep everyone honest. If a future Conservative government introduces “McKinsey’s Law,” it should make sure contracting out is still an easily available option. Who doesn’t work harder and smarter in the face of competitive pressure?

Privatization should be in play, too. If you go through the list of the 561 federal entities, it’s hard to believe a few dozen couldn’t be either merged or handed over to private-sector foundations. We’ve got an office of infrastructure of Canada, a Canada infrastructure bank, a couple of dozen other agencies that mention “infrastructure” in their terms of reference and, for good measure, an Asian infrastructure investment bank, as well as both African and Asian development banks. Coming soon, I suppose, infrastructure development banks, or maybe development infrastructure banks.

If you know anyone who works in Ottawa, or if you just keep track of the bizarre and astonishing HR stories that get picked up in the press, you know that it’s a rules-bound place. Everything has to be done by the book. And the book is very, very thick. In both senses of “thick.”

Having spent time in Ottawa, I’ve never found it surprising that estimates for the renovation of 24 Sussex Drive, official home of the prime minister since 1951, are $35 million, which by most Canadians’ standards would cover the cost of completely new construction of an at least modestly appointed palace. The original renovations in 1950, which got the place ready for Louis St. Laurent to move in, cost $500,000 — $5.9 million in today’s dollars.

No doubt everything in the blueprints is first-class, the only class the National Capital Commission thinks appropriate for itself. And of course, unlike any other Canadian doing renovations, it wouldn’t dream of paying cash. But before those governing this misbegotten county decide we can’t even get our act together enough to provide an official residence to our head of government, it would be nice to see estimates that reflected a more reasonable approach to cost and benefit.

I wonder if McKinsey does construction and renovations.

Financial Post