Consulting firms, including McKinsey, crushed by the Senate

POLITICS – A Senate inquiry committee on Thursday, March 17, accused the French entities of the McKinsey firm of tax optimization so that they would not have paid corporate taxes between 2011 and 2020.

If the US company is excluded, the Senate is more concerned in this report about the increasing reliance of governments on these private companies. With two main questions: their costs and the influence of these private entities on public decision-making.

This phenomenon “didn’t start under this five-year term,” the senators acknowledge. However, it was significantly strengthened under the presidency of Emmanuel Macron, who was himself close to the McKinsey cabinet before his election, as underlined The world. With increasing costs for public finances.

4 million euros for the reform of APL

“According to the elements provided by the ministries, the average cost of a day of (work of) an adviser is EUR 1528 including tax for the period 2018-2020,” the senators note. An average that can go much higher, sometimes above 3000 euros per day.

The McKinsey company invoiced 3.88 million euros for its intervention in the reform of the method for calculating personalized housing assistance (APL). 12.33 million euros for the vaccination campaign.

McKinsey is not an isolated case. Capgemini, which contributed to the development of the Public Action Results Barometer, received 3.12 million euros. Semaphores, responsible for helping the prefectures secure the spread of election propaganda, about 290,000 euros.

In total, the consultancy costs of the ministries, from 379.1 million euros in 2018, amounted to 893.9 million euros in 2021.

The cost to public finances is not the only fear of senators. They note that “consultants have intervened in most of the key reforms of the five-year term”, but they are also concerned about the influence they could have on public decision-making. Indeed, consultancies have “a habit of ‘prioritising’ proposed scenarios” to the administration that asks for them, “strengthening their weight in public decision-making”.

The committee is also concerned about the government’s “dependence” on certain actors and advocates making “the transfer of skills from consultancies to the administration” “more effective”.

Which solutions?

Among their nineteen final proposals, the parliamentarians propose to publish the list of services of the state and its operators in open data. They are also in favor of a systematic review of consultancy services above 150,000 euros and the ban on free services for governments. Another track: the systematic destruction, at the end of their mission, of the data entrusted to the firms.

Finally, the senators are counting on the High Authority for the Transparency of Public Life, whose resources they want to strengthen to monitor whether the cabinets are meeting their ethical obligations. “The health crisis has emphasized the intervention of advisers in the conduct of government policy. It was just the tip of the iceberg,” the inquiry said.

Asked about the Senate report during the presentation of his candidate program, Emmanuel Macron completely assumed the “legitimate” use of private companies, even adding that the increase in this phenomenon would not be “not inevitable”. “It is legitimate that the ministries have called on private companies,” said Emmanuel Macron. However, he wants rules and tenders to be ‘transparent and verifiable’ by ministerial inspections, by parliament and by the Court of Audit. “If we have the skills internally,” it is “good policy” not to call on these advisers, Emmanuel Macron believes.

In mid-January, Prime Minister Jean Castex signed a circular to regulate the use of “intellectual services”. But it is not “binding in nature,” the senators say, and the target of cutting advisory costs by 15% by 2022 is “unambitious”. A month later, under the pressure of the Senators’ investigation and the publication of the book Infiltrators (ed. Allary), the government announced the creation of “a kind of state consultancy, internal, which can support the administrations”, headed by the Minister of Transformation and the Functional Public Amélie de Montchalin.

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