Advice from giant consulting firm McKinsey broke the Canada Infrastructure Bank, and it’s time to fix that mistake.
On May 16, CUPE made our case for building a truly public bank at a House of Commons committee investigating the role of McKinsey in the bank’s design and early days.
Senior research officer Diane Therrien outlined how McKinsey and other corporate players like BlackRock radically shifted the bank’s mandate.
At first, the CIB was supposed to give local governments low-cost loans for infrastructure projects. Then the Liberal government outsourced the bank’s design to a corporate-heavy advisory group chaired by McKinsey’s Dominic Barton. After that, the bank’s focus abruptly shifted to profit-driven projects that cost more, deliver less, and force communities to privatize.
As the bank faces a five-year review, CUPE is calling for a major overhaul of the bank so it can meet community needs and tackle the climate crisis.
The bank was destined to fail from the start. More than five years after its founding, the CIB has not even met its own goal of attracting profit-seeking private investors. From day one, a lack of transparency and accountability have been major problems for the bank.
But luckily, it isn’t too late for the bank to change course. “There are models of successful banks around the world that we can turn to for guidance. There is no need to reinvent things,” said Therrien.
Therrien emphasized that the infiltration of governments by consultants is a widespread problem. Consulting firms are driven by profit and accountable to shareholders – not the public.
“McKinsey and other consultancies are notorious for providing advice to governments that undermines the work of the public service, and that seeks to continue down the dangerous neoliberal path of privatizing public services,” she told the committee.
Watch CUPE’s testimony: