Canada’s Failed Defence Procurement Policy – Time To Decide……Now!!

DAVEBLOGGINS

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This is an opinion piece by the author for Forum member discussion only and not to be disseminated to any other media.

Since the recent Federal Election, it is useful to look back at the two major political parties to review their defence procurement policies. The Conservative Party platform has a commitment to a fast-track replacement of the ageing CF-18s for the RCAF, and to ensure ships promised to the RCN and Canadian Coast Guard are delivered much sooner under the 2010 National Shipbuilding Strategy (NSS) and the 2017 Strategic document entitled “Strong, Secure and Engaged.” The Liberal defence policy stated that it will “ensure complex defence procurements are delivered on time, and that the government will create a new bureaucracy called “Defence Procurement Canada”. The question to be addressed here is, will there be substantial organizational change in the offing by the newly-minted Liberal Minority Government in the way defence procurement is currently conducted? I would argue that our current defence procurement system is broken and needs to be fixed…now! To add another failed plan to try to and decrease defence procurement time-lines when all it will do is create another failed defence procurement system will again be a strategic failure!

In 2018 the Auditor-General delivered an ugly and daming report on the Liberals’ handling of the fighter jet procurement program – specifically, the plan to buy interim warplanes from Australia until the CF-18 fleet can be replaced. The report described the purchase of these “interim fighters” as an all-out assault on evidence-based policy making. Ottawa can’t carry on with business as usual any longer when it comes to Defence Procurement Policies. The current government must quickly deliver on defence procurement, instead of doubling down on rhetoric. The problem is that past governments haven’t really paid a heavy price for botched military procurement projects. There was no political pain for the agony of the Sea King replacement, in the two-decade long process to replace the helicopter. With respect to the acquisition of 15 new warships for the RCN, it took up to two years of endless consultations with bidders, with the government making up to 88 amendments to the original tender document. In the end, the preferred bid was challenged by a competitor arguing not all of the navy’s criteria were met. The acquisition of the CSCs went from initial costs estimates of $14 billion CAD to estimates now from the Parliamentary Budget Office (PBO) of $77 billion with not a single CSC frigate produced since 2018 and the design phase still not finished by Lockheed Martin (LM) in 2021. The recently announced New Submarine Procurement Project by the RCN to replace the Victoria class fleet is something else for the government to decide upon. Let us hope this project will not take another twenty years for the government to make a decision.

Canada has the worst military procurement system in the world with no fifth-generation fighters or RCN/Canadian Coast Guard vessels to show for it. Since 2012, Public Services and Procurement Canada has assumed responsibility for the overall control and management of major defence procurements. This has introduced a crushing burden of bureaucratic structures that added a superficial ability to provide knowledgeable project management decisions. Despite there being only one realistic supplier for many defence capability requirements, the overriding preference has been to run competitions, increasing program costs and delaying capability delivery. Canada’s fighter replacement program has gone well over 16 years under the present government’s timeline. Most NATO countries required only two to four years to select the F-35. Canada’s air force is obsolescent and will become even more so over the next decade as most of our allies, and the US in particular, equip themselves with fifth-generation fighters. Meanwhile, we will continue to fly the CF-18s we currently have or the F-18s we acquire from Australia. As for maritime operations, here too procurement problems will plague the navy for at least the next decade. Certainly, for reasons of inadequate infrastructure alone, not to mention ongoing procurement problems that plague governments to keep pushing back completion dates, it will be impossible to meet the NATO target of two per cent of GDP on defence spending standard any time soon.”

One of the significant problems in acquiring new capital equipment for both the Canadian Forces and the Canadian Coast Guard is that some direction and decisions have to be quickly made by our politicians in Ottawa soon. For example, why is it taking so long to make a decision on acquiring a new fighter jet to replace the ageing CF-18 fleet. The facts before our “so-called” decision-makers are as follows:

(1) Canada has already spent over $600 million to remain a partner in the F-35 development costs since 1997 to the builder Lockheed Martin (LM) for the aircraft;

(2) Canada’s participation in this program allows Canadian companies to benefit from these contracts and allows Canada to buy the aircraft at a lower cost and a priority access to the production line;

(3) NATO countries have already purchased and are now operating the F-35, such as the US, Britain, Norway and Denmark. Other countries purchasing this fifth-generation fighter aircraft are Australia, Japan and Switzerland; and

(4) Canada purchasing the F-35 will make future RCAF operations compatible with their NATO allies. Even now the RCAF will be years behind operationally with the NATO partners in eventually purchasing 88 F-35s.

Although the Conservatives want to speed up the replacement programs for the capital projects for both the Canadian Forces and the Coast Guard, they fail to clearly address the causes of the current procurement bottlenecks to create faster delivery of defence projects. The Liberals say they are going to establish a new “organization” from the existing scheme, which will only add another layer of bureaucracy to the current regime but again have failed to describe how the current processes can be improved. In My Opinion (IMO), it is critical that Canadian governments quickly carry out a comprehensive review to improve and streamline our defence procurement system within the next 6 months! Ottawa must make a real effort to make decisions much sooner in acquiring capital equipment for the Canadian Forces and Coast Guard. Our operational capability is being seriously affected by the inability to get new equipment into the hands of our Canadian service members much sooner. It is time the federal government made decisions much more quickly to improve our embattled procurement regime that has not worked for many years now.

The Conservative Party platform seems to more adequately capture the urgency associated with the need to procure a number of key weapon system platforms necessary for the CAF to fulfill its mandates required by all Canadians. By extension, this suggests a Conservative government would quickly make some of the hard decisions related to the procurement initiatives, something the current Liberal government appears reluctant to do. Furthermore, the Liberal policy merely chooses to create another layer of bureaucracy to the procurement process, and doesn't serve notice it is prepared to deliver on procurement budgets previously committed, something of importance when it comes to how it intends to fund announced covid-related social support programs. Historically, defence-related budgets or procurement programs are first on the chopping block when it comes to re-allocating budgets. Neither party, however, proposes that a fundamental review of the procurement process is required within the next 6 months in order to fix systemic and structural challenges and inadequacies associated with the current Defence Procurement process.
 
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