A bombshell of a report was released on the influence of private consulting firms on public policy in France, and it seems that the Macron government has been overusing such services in a more than dubious manner.
A Senate inquiry committee revealed in a 400-page document, that almost €1 billion has been spent in consulting fees, with very little to show for it.
Just two weeks before the first round of the French presidential election, ‘McKinsey Gate’ - as it has been dubbed in reference to the US-based management consulting company that was used- is now threatening Macron’s re-election campaign.
It is also shedding light on the influence of external firms on the activities of the French state.
When pandemic first hit, the government found itself severely underprepared. Although warned by France’s ambassador to China, Laurent Bili, that there was an outbreak of a new deadly virus in the Wuhan region, Emmanuel Macron and his administration failed to take the matter seriously. The rest, as they say, is history.
After several lockdowns, overflowing hospitals, overworked medical personnel who were at breaking point, and tens of thousands of deaths, the government opted to seek help from international consultants instead of relying on the already existing services within its ministry of health.
It was reported that consulting firms secured 28 contracts from the government for a total of €11.3 million. McKinsey secured the biggest share of the consulting piece, receiving around €4 million.
What has shocked many about the links to McKinsey, is the fact that the company has been involved in the biggest health scandal of recent decades in the US, and was accused of fuelling the country’s opioid crisis. Indeed, the firm had been advising pharmaceutical giant Purdue Pharma on how to aggressively market its highly addictive OxyContin and even on how to give incentives to keep selling the product in cases of side-effects or death. To avoid further prosecution, McKinsey paid an astronomical $600 million settlement. Yet, this firm was somehow deemed worthy of leading France’s health strategy.
To make matters worse, the Senate also uncovered through discussions with the head of the public sector division, Karim Tadjeddine, that for the past ten years, McKinsey had not paid taxes in France.
Tadjeddine was also asked by the committee to describe what was achieved from the €500,000 euro deal between McKinsey’s public sector service and the ministry of education. This was a simple enough question, but alas a clear response with a list of outcomes was too much to expect. Tadjeddine’s answer reaffirmed what was already suspected, very little.
The question remains, with so much expertise within France, why was there a need to spend such excessive amounts of money seeking help from abroad?
France has for a long time prided itself in having elite public schools to train the future high ranking public service holders. The most notorious being the ‘Ecole Nationale d’Administration (ENA)’ which was founded in 1945 by former president Charles De Gaulle as a “nursery for future clerks of the Republic”. Several of France’s presidents and a considerable number of its ministers and senior public officials have graduated from the institution.
Not to mention, Emmanuel Macron himself created the ‘Haut Commissariat au Plan’ for the purpose of developing and managing public policy decisions.
As revealed by the 2017 Macron Leaks, prior to his electoral victory, the president was surrounded by McKinsey consultants who had “worked for free” during his campaign trail. In the long term of course, this paid off for McKinsey because they won on two levels. The firm secured highly profitable contracts from the French government, while advising it to further apply neoliberal reforms, dismantle the welfare state through privatisation and austerity, which it also of huge benefit to them.
A McKinsey alum, Thomas Cazenave, ended up heading the inter-ministerial directorate for public transformation (DITRP), a position created in the wake of Macron’s electoral win.
The growing influence of consulting firms on the French state did not start with Macron, however. Under former president Nicolas Sarkozy, François Daniel Migeon, who had served as general director for the ‘modernisation of the state’ under his government, had previously worked for McKinsey.
Nevertheless, an important difference is that the number of consulting contracts more than doubled since 2018, according to the Senate investigation.
To quell public outrage, the minister of public transformation and service, Amélie Demontchalin, - another client of McKinsey- held a press conference during which she declared “We have nothing to hide.” She was joined by the budget minister, Olivier Dussopt, who is under investigation for receiving bribery in the form of works of arts.
Nothing about the event was exactly reassuring, especially given that the full extent of taxpayers’ money that has been spent on these consulting companies could be even more than €1 billion because the investigation was only based on 10% of state operators.
Emmanuel Macron reiterated that there was nothing to hide during a France Info interview. He added that if accusers had proof of any wrongdoing then they should bring the matter to court. This is of course a classic deflection tactic because the president and his administration are not being accused of breaching the law, but for breaching public trust.
Macron has avoided to address the obvious conflict of interest: that a private firm has been advising the French government while pushing for reforms that obviously serve its own agenda. And, that the state has spent a billion euros on these fees which neither made their policies successful nor popular. When all is said and done, all that the government has to show for all of this is the 150,000 Covid-19 related deaths and so much suffering across society.
The McKinsey affair highlights how public policy is no longer being conducted by elected and accountable public servants, but by faceless lobbyists who barely pay their taxes yet are hired by tax-funded institutions. Two weeks before the election, Emmanuel Macron has failed to bury the scandal which has been capitalised on by his rivals across the board. How the scandal is dealt with will ultimately test whether France is functioning democracy on the international stage, as well as amongst its own people who will make their feelings clear to Macron at the ballot box.
Yasser Louati is a French political analyst and head of the Committee for Justice & Liberties (CJL). He hosts a hit podcast called "Le Breakdowh with Yasser Louati" in English and "Les Idées Libres" in French.
Follow him on Twitter: @yasserlouati
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