Federal government flouted rules when awarding McKinsey contracts: AG report

The Auditor General of Canada says the federal government flouted proper contracting policies and was unable to show it got value for money when awarding $209 million in contracts to consulting firm McKinsey & Company.

«Across the 97 contracts awarded to McKinsey & Company, we found frequent disregard for procurement policies and guidance and that contracting practices often did not demonstrate value for money,» Auditor General Karen Hogan said in her spring report.

Hogan's office looked at all of the contracts awarded to the American consulting company by federal departments, agencies and Crown corporations between Jan. 1, 2011, and Feb. 7, 2023.

Of the $209 million in contracts that were awarded, the auditor general says that $200 million was spent. Hogan said only about $8.6 million of the $200 million went to McKinsey & Company under the former Conservative government.

Last year, a Radio-Canada investigation found that the amount of money McKinsey & Company earns from federal contracts exploded since Prime Minister Justin Trudeau came to power.

The audit of those contracts by Hogan's office found that from 2011-12 until 2014-15, the company was awarded less than $5 million a year for professional services. That started rising in 2015-16, when it hit $10 million, before steadily increasing to more than $55 million a year by 2021-22.

When the audit strips out the contracts awarded by Crown corporations to focus solely on government departments and federal agencies, the value of contracts given to the U.S. consulting firm in 2021-22 is just above $32 million a year.

Fraction of government spending on contracting

While that number is still dramatically larger than what the company received before the Liberal government came