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The flow of government dollars to global consulting firm McKinsey and Company has increased sharply as the Liberals have turned to the company for help with the struggling Phoenix pay system and other issues, a Globe and Mail analysis of federal outsourcing contracts shows.

The former Conservative government did very little business with McKinsey during its final years in power, but after the Liberals formed government in 2015 spending on the firm’s services began to accelerate. The spending nearly doubled last year as the COVID-19 pandemic worsened.

Five federal departments paid a combined $17.2-million to McKinsey during the 2020-21 fiscal year, compared to $9.3-million the previous year and $3.4-million the year before that. Throughout this period of increased spending, the government maintained close ties with Dominic Barton, who was until 2018 the firm’s head.

A person makes a video call from their phone as they pass a pile of snow in front of Parliament Hill's Centre Block in Ottawa after a winter storm on Monday, Jan. 17, 2022. THE CANADIAN PRESS/Justin TangJustin Tang/The Canadian Press

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Security flaw found in smartphone app for Olympians in Beijing

Security flaws in a smartphone application that is required for athletes and team officials attending the 2022 Beijing Olympics leave users at risk of having their calls and data intercepted, the University of Toronto’s non-profit Citizen Lab has found.

Beijing Olympics organizers require all participants to use the app, which is the property of a Chinese, state-owned company.

The application “has a simple but devastating flaw where encryption protecting users’ voice audio and file transfers can be ... sidestepped” with little effort, Citizen Lab researcher Jeffrey Knockel writes in a new report.

Canadian home prices hit record high in 2021

Canada’s housing market ended the second year of the pandemic with record highs in price growth and home values, suggesting the country’s affordable-housing problem now extends beyond major metropolitan areas and into smaller cities.

The typical price of a home across the country rose 26.6 per cent in December compared with a year earlier – the fastest pace on record – hitting a new high of $811,700, according to the Canadian Real Estate Association’s home price index, which adjusts for pricing volatility.

As the country enters the third year of the COVID-19 crisis, the housing market’s underlying conditions remain essentially the same as they have been from the pandemic’s beginning: The cost of borrowing is close to zero, there is strong demand from domestic residents and there is a shortage of houses for sale.

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ALSO ON OUR RADAR

China expands use of coercion to bring back citizens abroad: China has been expanding its use of coercion to force the return of Chinese citizens who have settled abroad, many of them in Australia, Canada and the United States, in a campaign targeting fugitives and dissidents, a new report by a Spanish-based rights group says.

Health Canada approves COVID-19 antiviral pill: Health Canada yesterday approved Paxlovid, the first oral COVID-19 medication that can prevent severe illness or death in some high-risk individuals, an important milestone that could eventually help alleviate some pressure on hospitals.

Quebec group pushes for new way to measure economy: A diverse group of Quebec leaders in business, labour and other sectors is urging policy makers to look past gross domestic product as a measure of well-being and adopt a broader view of prosperity, as Canada confronts unprecedented health and environmental crises.

Businesses, consumers expect to feel inflation’s pinch for a while: Canadian businesses and consumers expect to feel the pinch of inflation for an extended period of time as continuing supply chain disruptions and labour shortages push up costs and strong demand allows companies to pass these increases along to customers, according to a Bank of Canada survey.

Former Ukrainian president returns to face treason case: Former Ukrainian president Petro Poroshenko returned to Kyiv yesterday and was sent to court to face controversial treason charges, a legal process that exacerbates Ukraine’s political divide at a time when the Russian military remains massed at the country’s border.

Who betrayed Anne Frank? Canadian author details surprising findings: A new book by Canadian author Rosemary Sullivan, The Betrayal of Anne Frank: A Cold Case Investigation takes a look at who revealed Anne Frank’s hiding place to the Nazis. The years-long investigation points the finger at Arnold van den Bergh, a notary before the war and, during the Nazi occupation, a member of the Jewish Council, a body mandated by the Nazis to govern various aspects of Jewish life.


MORNING MARKETS

Crude prices jump: A seven-year high for oil prices pushed benchmark German Bund yields to the brink of positive territory on Tuesday, lifted U.S. Treasuries to pre-COVID levels and left global share markets trudging lower. Just before 5:30 a.m. ET, Britain’s FTSE 100 dropped 0.88 per cent. Germany’s DAX and France’s CAC 40 fell 1.29 per cent and 1.01 per cent, respectively. In Asia, Japan’s Nikkei ended down 0.27 per cent. Hong Kong’s Hang Seng lost 0.43 per cent. New York futures were weaker. The Canadian dollar was trading at 79.91 US cents.


WHAT EVERYONE’S TALKING ABOUT

Campbell Clark: “Being opposition leader is often a thankless task, and Mr. O’Toole’s is more so because he doesn’t have much of a visible constituency inside his own party. His move from “true blue” leadership candidate to moderate leader upset some of the base, and he hasn’t been able to expand the base. The base that wants him to take a hard run at Mr. Trudeau. And he often seems like a leader running in place.”

Andrew Willis: “Selling Freedom Mobile, or any of Shaw’s wireless business, to private equity would also just kick the cellphone competition issue down the road. These fund managers must exit a holding, typically within a decade, to pay back their investors. The logical buyer would be one of the three incumbent telecom companies.”


TODAY’S EDITORIAL CARTOON

Brian GableBrian Gable/The Globe and Mail


LIVING BETTER

Want to travel to a ski resort in Canada during the pandemic? These are the COVID-19 restrictions

For many Canadians, winter is the time to hit the slopes. This year, doing so requires a bit of extra planning. A majority of provinces require proof of vaccination to use non-essential services, but each ski resort has its own set of rules and restrictions when it comes to chairlifts, dining, rentals and more. Here’s what you need to know about the country’s largest resorts.


MOMENT IN TIME: JANUARY 18, 1919

British Prime Minister Lloyd George (L), Italian Council President Vittorio Orlando (2nd L), French council President Georges Clemenceau (2nd R) and U.S. President Woodrow Wilson attend the opening day of the Conference for Peace in Paris on January 19, 1919.AFP/Getty Images

Paris Peace Conference opens

The First World War had been so destructive and traumatic – an estimated 20 million dead and about the same number wounded – that some called it, in hope, the War to End All Wars. But those who arrived in Paris to hammer out the terms of the peace were so determined to punish Germany and its allies that they ensured a sequel. At the historic conference, which began on this day in 1919, French prime minister Georges Clemenceau, British prime minister David Lloyd George and American president Woodrow Wilson demanded that Germany surrender its empire and parts of its territory, pay reparations to the victors and limit the size of its army. British economist John Maynard Keynes was among the first to warn that the terms of the Treaty of Versailles would inevitably lead to another, even more terrible, war. “If we aim at the impoverishment of Central Europe,” he wrote, “vengeance, I dare say, will not limp.” Facing poverty, starvation and civil unrest, many Germans became convinced that they had been betrayed by their own leaders and others from within. One of them was a veteran of the war, Adolf Hitler. John Ibbitson


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