Committee overview: Standing Committee on Public Accounts: Auditor General Report 5, Professional Services Contracts (December 11, 2025)

Opening remarks

Thank you Mr. Chair.

As we reported to the Operations and Estimates committee two years ago, McKinsey and Company was paid a little more than $4.3-million for three contracts between 2016 and 2019.

Un quatrième contrat a été annulé avant le début des travaux, car il a été déterminé que ceux-ci pouvaient être réalisés à l'aide de fonctionnaires plutôt que par le biais d'un contrat. Aucun fonds n'a été dépensé dans le cadre de ce contrat.

The CBSA's first contract with McKinsey took place between May and October 2016. It was established to review and validate options, risks and impacts associated with the Agency's Assessment and Revenue Management Project – also known as CARM. The total amount spent was $1.8 million.

CARM was initiated to replace information technology systems and processes used in the collection of the approximately $40 billion in duties and taxes that CBSA collects on all commercial goods imported to Canada. This work was to have an external assessment to validate the approach and potential benefits.

The CBSA's second contract with McKinsey was from October 2017 to October 2018. The work was done to support benchmark traveller processes of other countries and make recommendations on how CBSA can use technology to manage increasing travel volumes. The total amount spent was $1.6 million.

The third contract was awarded under Public Services and Procurement Canada's contracting authority between October 2018 and January 2019, to establish a project management office and amended work plan for the CARM project. The total amount spent was $978,000.

Le quatrième et dernier contrat, conclu le 21 octobre 2022, portait sur des services d'analyse comparative pour le projet de GCRA. Comme je l'ai dit, il a été résilié avant le début des travaux.

The CBSA has benefited from eight audits and reviews covering procurement in recent years. These included reviews by the Auditor General, but also the Procurement Ombudsman and our own internal audit function.

These reviews resulted in 25 recommendations – including the two relating to the OAG's audit on McKinsey. The Agency has now implemented all of them.

Among the improvements CBSA has made are:

• Conflict of Interest Declarations in all contract files
• Integrated procurement as part of business planning, and strengthened governance to increase oversight
• Compliance reviews for all contract files
• Enhanced guidance tools and mandatory procurement training for all cost centre managers

Thank you. I am happy to answer any questions.

Committee Members

Committee Members biographies

John Williamso (Chair)

Political affiliation: Conservative Party of Canada
Constituency: Saint John—St. Croix

• Re-elected for a fourth term in 2025, having previously served from 2011-2015 and returning in 2019
• Has chaired PACP since March 2022. Also sits on Liaison Committee
• Represents southwestern New Brunswick riding that includes portions of border with Maine
• Over 25 years of experience in public policy research and conservative movement activism
• Prior to his election, M. Williamson was employed as an editorial writer for the National Post from 1998 to 2001, and served at the Canadian Taxpayers Federation until 2008. In 2009, he was hired by PM Harper as director of communications in the PMO

Interests: Overall government transparency and accountability

Jean Yip (Vice-Chair)

Political affiliation: Liberal Party of Canada
Constituency: Scarborough - Agincourt

• Elected as MP for Scarborough—Agincourt in a by-election on December 11, 2017, and re-elected in 2019 and 2021
• Has served on Public Accounts since 2018 (vice-chair since 2021), as well as Government Operations and Canada-China committees in the past
• Before her election, Ms. Yip was an insurance underwriter and constituency assistant
• Founder and Chair of the Liberal Chinese Caucus, previously served as Co-Chair of the Seniors Caucus

Interests: GBA+ and gender and diversity considerations in the Public Accounts; Environmental, Social, and Governance reporting.

Sébastien Lemire (Vice-Chair)

Political affiliation: Bloc Québécois
Constituency: Abitibi—Témiscamingue

• First elected as MP in the 2019 federal election, re-elected in 2021 and 2025
• BQ Critic for Public Accounts, Indigenous and Northern Affairs, and Sport
• Also sits on the Standing Committee on Indigenous and Northern Affairs as Vice-Chair. Previously member of INDU
• Graduate in political communication, specializing in public relations and citizen participation
• Professional background includes work as a communications specialist for elected officials in Montreal, the Union des producteurs agricoles in Abitibi-Témiscamingue, and on the board of the Régie des rentes du Québec

Interests: Indigenous rights, fiscal fairness to Quebec, Quebec autonomy.

Gérard Deltell

Political affiliation: Conservative Party of Canada
Constituency: Louis-Saint-Laurent—Akiawenhrahk

• First elected federally in 2015, re-elected in each subsequent election
• New to PACP in 2025, but previously served for one year 2017-2018; was also member of ENVI (3 years), and shorter roles on RNNR, INDU and OGGO
• Served as representative Quebec's National Assembly from 2008 to 2015, serving as parliamentary leader and house leader from 2012 to 2014
• Had a long career in television journalism that ended when TQS shut down
• Strong supporter of the military

Interests: Financial management and transparency, natural resources and energy policy, respect for provincial jurisdiction, is a car enthusiast.

Anthony Housefather

Political affiliation: Liberal Party of Canada
Constituency: Mount Royal

• First elected federally in 2015, re-elected in each subsequent election
• New to PACP in 2025, previously served on ETHI, JUST, Heritage, and OGGO
• Served as Chair of the House of Commons Standing Committee on Justice and Human Rights from 2016 to 2019
• Was previously parliamentary secretary for TB President, Procurement Minister, and Labour Minister
• Holds two law degrees, previously served as mayor of Cote Saint-Luc, and was also General Counsel at technology company

Interests: Jewish community issues and combating antisemitism, justice and human rights, is a talented swimmer.

Ned Kuruc

Political affiliation: Conservative Party of Canada
Constituency: Hamilton East—Stoney Creek

• First elected federally in 2025
• Represents an urban Ontario constituency in the Hamilton area with diverse economic interests
• Prior to being elected, worked as an entrepreneur and sports management executive; owns several cannabis dispensaries
• Lifelong practice in combative sports (karate, judo, Ju jitsu), serves on Combative Sport Advisory Council to Ontario Minister of Tourism, Sport and Culture

Interests: Crime rates, justice reform, housing affordability, impact of tariffs.

Stephanie Kusie

Political affiliation: Conservative Party of Canada
Constituency: Calgary Midnapore, AB

• First elected in a by-election in April 2017; re-elected in each subsequent election
• Currently serves as Shadow Minister for Treasury Board
• Served on Operations Committee (OGGO) for almost 3 years, is well acquainted with Procurement files; has also served on HUMA, LANG, TRAN, some in the role of Vice-Chair
• Former Canadian diplomat with international experience before entering federal politics

Interests: Fiscal responsibility, foreign policy and internation relations, cost of living, Canada's energy sector.

Tom Osborne

Political affiliation: Liberal Party of Canada
Constituency: Cape Spear, NL

• First elected in 2025, currently serving as Parliamentary Secretary to the President of the Treasury Board
• Prior to federal role, served in provincial government in Newfoundland and Labrador from 1996 to 2024, serving in Cabinet and as Speaker over the years
• His Provincial Cabinet roles included Finance, Health, Justice, Environment, and Education

Interests: Affordability, justice and public safety, the environment.

Kristina Tesser Derksen

Political affiliation: Liberal Party of Canada
Constituency: Milton East—Halton Hills South, ON

• First elected in 2025, after a judicial recount in her riding
• Has undergraduate degree in history and political science and law degree from University of Toronto
• Previously served two terms as a Milton town councilor and ran her own law practice before entering federal politics
• Has volunteered and served on various local boards and organizations in her community

Interests: legal system, affordability, community service.

Mandate of the Committee

When the Speaker tables a report by the Auditor General in the House of Commons, it is automatically referred to the Public Accounts Committee. The Committee calls the Auditor General and senior public servants from the audited organizations to appear before it to respond to the Office of the Auditor General's findings. The Committee also reviews the federal government's consolidated financial statements – the Public Accounts of Canada – and examines financial and/or accounting shortcomings raised by the Auditor General. At the conclusion of a study, the Committee may present a report to the House of Commons that includes recommendations to the government for improvements in administrative and financial practices and controls of federal departments and agencies.

Government policy, and the extent to which policy objectives are achieved, are generally not examined by the Public Accounts Committee. Instead, the Committee focuses on government administration – the economy and efficiency of program delivery as well as the adherence to government policies, directives and standards. The Committee seeks to hold the government to account for effective public administration and due regard for public funds.

Pursuant to Standing Order 108(3) of the House of Commons, the mandate of the Standing Committee on Public Accounts is to review and report on:

• The Public Accounts of Canada
• All reports of the Auditor General of Canada
• The Office of the Auditor General's Departmental Plan and Departmental Results Report
• Any other matter that the House of Commons shall, from time to time, refer to the Committee

The Committee also reviews

• The federal government's consolidated financial statements
• The Public Accounts of Canada
• Makes recommendations to the government for improvements in spending practices
• Considers the Estimates of the Office of the Auditor General

Other responsibilities

• The economy, efficiency and effectiveness of government administration
• The quality of administrative practices in the delivery of federal programs
• Government's accountability to Parliament with regard to federal spending

Scenario note

Topic: Report 5, Professional Services Contracts, of the 2024 Reports 5 to 7 of the Auditor General of Canada
Date and time: Thursday, December 11, 2025 (11:00 am to 1:00 pm)
Location: Room 415, Wellington Building, 197 Sparks Street

Overview

The committee has been examining the backlog of Auditor General reports deferred from the previous Parliament. The Professional Services Contracts audit was requested by the committee through a motion passed on January 30, 2023, instructing the Auditor General to conduct a performance and value-for-money audit covering all contracts awarded to McKinsey & Company by any federal entity since January 2011.

The AG's report on was tabled in June 2024. No organizations were specifically named in the report's sole recommendation, but the CBSA was at the top of the list for spending on services contracts with McKinsey from 2011 to 2023. The recommendation called for:

all federal organizations to implement a proactive process to identify actual or perceived conflicts of interest in the procurement process and retain the result of such a process and completed conflict‑of‑interest declarations in the procurement file.

Timing of rounds of questions:

• Five minutes are allotted for the opening statement
• Questioning of witnesses:
  • First round: six minutes for the first questioner of each party as follows: Conservative Party, Liberal Party, Bloc Québécois
  • For the second, and subsequent rounds, the order and time for questioning is as follows: CPC: 5 minutes, LPC 5 minutes, BQ 2.5 minutes, CPC 5 minutes, LPC 5 minutes

The total time allocated per round of questioning includes the member's questions and the witness' responses. There is no time limit on responses from witnesses; however, succinct answers are preferred.

Witnesses to appear

• Erin O'Gorman, President, CBSA
• Ryan Pilgram, Chief Financial Officer, CBSA
• Mike Leahy, Director General, Commercial and Trade Branch, CBSA
• Name TBC, Public Sector Pension Investment Board
• Name TBC, OAG

Parliamentary analysis – House of Commons

PACP Study: Report 5

This is the fourth meeting of the study.

• On October 7, 2025, officials from PSPC, DND, and the Canada Infrastructure Bank appeared, alongside OAG representatives. At that meeting, members were focused on questioning why procurement rules weren't followed, how much money would be recovered from contractors like GC Strategies, and what specific measures departments have implemented to prevent future non-compliance and ensure better oversight of professional services contracts. Specific questions asked concerning the decision to seek recovery of only $198,000 related to overbilling by GC Strategies were referred to the CBSA
• On November 18, the CFO of Trans Mountain Corporation appeared. At that meeting, members were focused mainly on the McKinsey contract with Trans Mountain, conflict of interest processes, and the Trans Mountain pipeline project's costs and returns. Conservative members questioned witnesses about the non-competitive awarding of contracts and about conflict of interest training
• On December 2, the committee heard testimony from officials from the Business Development Bank of Canada, Canada Post, IRCC and officials from the AG's office. Witnesses shared that their organizations have strengthened documentation requirements, guidance on conflicts of interest, and verification processes since the report. Key issues raised included consultants accessing government systems without proper security clearance, the rationale for awarding contracts to non-lowest bidders, and plans across organizations to reduce reliance on external consultants while maintaining capacity for specialized needs

Previous committee studies:

ArriveCAN, of the 2024 Reports of the Auditor General of Canada – Although the committee did not issue a final report, the committee held 24 meetings on the study of the Auditor General's report on ArriveCAN. CBSA officials appeared several times regarding this study, and was named in all eight of the AG's recommendations, which included:

• maintaining financial records, documenting interactions with potential contractors
• documenting reasons for decisions made during non‑competitive procurement processes
• having contracts and task authorizations reviewed by the Procurement Directorate
• ensuring potential bidders are not involved in developing any part of an RFP
• ensuring services contracts and task authorizations specify required qualifications
• ensuring tasks and deliverables are clearly defined in contracts
• verifying names, hours worked, and security clearances before payments
• conducting sufficient testing before updating any applications

Committee members were very interested in getting to the bottom of the matter, hearing testimony from the CBSA President, several former CBSA employees, the President of the Treasury Board, the Deputy Minister of PSPC, the Minister of National Defence, the RCMP Commissioner, representatives from contractors and consultants, and other public servants.

Upcoming PACP studies:

The committee is expected to continue to review Auditor General reports, dedicating different numbers of meetings depending on the implications of the recommended actions for government departments. After the tabling of new audits in October 2025, the committee agreed to undertake a study on the Canada Revenue Agency's Contact Centres (2 meetings have been held), and has held 2 meetings regarding Current and Future Use of Federal Office Space (which was identified as a priority by both the Conservative Party and the Liberal Party).

The committee also intends to study Connectivity in Rural and Remote Areas, Delivering Canada's Future Fighter Jet Capability, Early Learning and Childcare, and the GC Strategies audit. Other reports and subjects proposed by members for the committee's future agenda include: Canada's Record on Sustainable Development, Seniors Programs, CEBA loans, Industrial and Technological benefits, and the Canada Summer Jobs Program.

Other committee studies:

The Standing Committee on Government Operations & Estimates (OGGO) dedicated 17 meetings in the 44th parliament to a study entitled "Federal Government Consulting Contracts Awarded to McKinsey & Company". During this study, this committee adopted a motion requesting that an audit be performed by the Auditor General. The committee did not issue a final report, here is a short overview of meeting developments of relevance to the Agency:

The focus for the CBSA was on three completed contracts totaling $4,337,610 awarded since 2016. During testimony, former Public Safety Minister Mendicino and CBSA President O'Gorman explained that the contracts supported transformational business processes for digital and organizational renewal, particularly the $1.9 million CARM project focused on maximizing revenue collection while facilitating compliant traveler processing. The committee scrutinized the CBSA's procurement processes, with the Minister asserting contracts followed competitive bid processes, though broader findings revealed 78% of McKinsey contracts government-wide were sole-sourced. Members raised security concerns about potential conflicts of interest, questioning whether McKinsey analysts working for CBSA could simultaneously serve clients hostile to Canadian interests, referencing McKinsey's controversial work with U.S. Immigration and Customs Enforcement. The CBSA also confirmed that a fourth $1.9 million contract initiated in October 2022 was terminated before work began as internal resources proved sufficient, and that McKinsey was not involved in the agency's response to the toxic drug crisis.

The Standing Committee on Transport, Infrastructure and Communities (TRAN) conducted a study entitled "The Role of McKinsey & Company in the Creation and the Beginnings of the Canada Infrastructure Bank" in 2024, and tabled a report with recommendations for the government in 2025. The report included 2 supplementary opinions from the CPC and BQ expressing concern about conflicts of interest between senior government officials and McKinsey employees, and improper procurement processes for CIB contracts awarded.

Questions, Statements, and Debates in the House

June 12, 2025 – during an opposition debate GC Strategies, Conservative members made parallels to contracts between these service providers.

Kelly McCauley (Edmonton West, CPC): Of course, we know the root cause of the problem. The root cause is Liberal incompetence. The cause, of course, is the Liberals' almost stalker-like affection for handing out Canadian taxpayers' money to high-priced management consultants, much like McKinsey. McKinsey, if anyone has not realized, is probably one of the worst corporations in the world. It helped supercharge the opioid crisis. It represents some of the most despotic regimes in the world. If McKinsey were a human being, it would be a Bond villain, yet the government violated procurement rules to shove money into McKinsey's pockets. Even when government bureaucrats came forward and said, "We have the bodies available to do this work", the government broke rules to give money to McKinsey. It was the same with ArriveCAN and GC Strategies.

Related Written Questions (responses attached as annexes):

Q-27 – May 27, 2025 – Laila Goodridge (Fort McMurray – Cold Lake)

With regard to contracts provided by the government to McKinsey & Company since January 1, 2023, broken down by department, agency, Crown corporation, or other government entity: (a) what is the total amount spent on contracts; and (b) what are the details of all such contracts, including (i) the amount, (ii) the vendor, (iii) the date and duration, (iv) the description of the goods or services provided, (v) the topics related to the goods or services, (vi) the specific goals or objectives related to the contract, (vii) whether or not the goals or objectives were met, (viii) whether the contract was sole-sourced or awarded through a competitive bidding process? Response.

Q-65 – May 30, 2025 – Ned Kuruc ((Hamilton East-Stoney Creek)

With regard to contracts that have been cancelled by the government since January 1, 2023, broken down by department, agency, Crown corporation or other government entity: (a) how many contracts have been cancelled; (b) what is the total amount paid out in cancellation fees or penalties; and (c) what are the details of all such cancellations, including, for each, the (i) date on which the contract was signed, (ii) date on which the contract was cancelled, (iii) vendor, (iv) value, (v) description of the goods or services, (vi) reason for the cancellation, (vii) cancellation fee or other similar type of cost to the government?

Annex A - About PACP

The Standing Committee on Public Accounts (PACP) was reconvened on June 19, 2025, following the opening of the 45th Parliament.

Committee Mandate

Pursuant to Standing Order 108(3)(g) of the House of Commons, the Standing Committee on Public Accounts has a mandate to, among other matters:

review of and report on the Public Accounts of Canada and all reports of the Auditor General of Canada, which shall be severally deemed permanently referred to the Committee immediately after they are laid upon the table […]

The Committee also has the general mandate given to all committees under Standing Order 108(2); that is, the power to study and report on all matters relating to the mandate, management and operation of the government department(s) that are assigned to them. In the case of the Committee, the department is the Office of the Auditor General of Canada.

Additionally, the Committee may enquire into any other matter that the House of Commons may refer to it.

The Public Accounts Committee is Parliament's standing audit committee, and it reviews the work of the federal government's external auditor, the Auditor General of Canada.

When the Speaker tables a report by the Auditor General in the House of Commons, it is automatically referred to the Public Accounts Committee. The Committee selects the chapters of the report it wants to study and calls the Auditor General and senior public servants from the audited organizations to appear before it to respond to the Office of the Auditor General's findings. The Committee also reviews the federal government's consolidated financial statements – the Public Accounts of Canada – and examines financial and/or accounting shortcomings raised by the Auditor General. At the conclusion of a study, the Committee may present a report to the House of Commons that includes recommendations to the government for improvements in administrative and financial practices and controls of federal departments and agencies.

Government policy, and the extent to which policy objectives are achieved, are generally not examined by the Public Accounts Committee. Instead, the Committee focuses on government administration – the economy and efficiency of program delivery as well as the adherence to government policies, directives and standards. The Committee seeks to hold the government to account for effective public administration and due regard for public funds.