OGGO Committee Meeting
Notices of Meeting include information about the subject matter to be examined by the committee and date, time and place of the meeting, as well as a list of any witnesses scheduled to appear. The Evidence is the edited and revised transcript of what is said before a committee. The Minutes of Proceedings are the official record of the business conducted by the committee at a sitting.
For an advanced search, use Publication Search tool.
If you have any questions or comments regarding the accessibility of this publication, please contact us at accessible@parl.gc.ca.
Standing Committee on Government Operations and Estimates
|
l |
|
l |
|
EVIDENCE
Tuesday, March 22, 2022
[Recorded by Electronic Apparatus]
[English]
Welcome to meeting number nine of the House of Commons Standing Committee on Government Operations and Estimates.
Today, the committee will continue its study on air defence procurement projects. We will hear from representatives of Public Services and Procurement Canada and the Department of National Defence.
Today’s meeting is taking place in a hybrid format, pursuant to the House order of November 25, 2021. Members are attending in person in the room and remotely using the Zoom application. Regarding the speaking list, the committee clerk and I will do our best to maintain a consolidated order of speaking for all members, whether you're participating virtually or in person. I would like to take this opportunity to remind all participants in this meeting that screenshots or taking photos of your screen is not permitted.
Given the ongoing pandemic situation and in light of the recommendations from public health authorities, as well as the directive of the Board of Internal Economy on October 19, 2021, to remain healthy and safe, the following is recommended for all those attending the meeting in person.
Anyone with symptoms should participate by Zoom and not attend the meeting in person. Everyone must maintain a two-metre physical distancing, whether seated or standing. Everyone must wear a non-medical mask when circulating in the room. It is recommended in the strongest possible terms that members wear their masks at all times, including when seated. Non-medical masks, which provide better clarity over cloth masks, are available in the room. Everyone present must maintain proper hand hygiene by using the hand sanitizer at the room entrance.
Committee rooms are cleaned before and after each meeting. To maintain this, everyone is encouraged to clean surfaces such as the desk, chair and microphone with the provided disinfectant wipes when vacating or taking a seat.
As the chair, I will be enforcing these measures for the duration of the meeting. I thank members in advance for their co-operation.
I would like to welcome the witnesses and invite the representative of PSPC to make his opening statement.
Thank you very much, Mr. Chair.
Good afternoon. My name is Simon Page and I am pleased to be with you today in my role as assistant deputy minister of the defence and marine procurement branch at Public Services and Procurement Canada.
The Minister of PSPC's 2021 mandate letter includes a commitment to “Ensure the ongoing delivery of defence procurements in support of Canada's Defence Policy, 'Strong, Secure, Engaged'.”
We work very closely with DND and our other federal partners to ensure that we provide the acquisitions support needed to deliver the right equipment and services to the Canadian Armed Forces in a timely manner. PSPC chairs the interdepartmental governance committees established under the defence procurement strategy to bring together all the key federal players to transparently consider trade-offs related to capabilities, cost, the timely delivery of equipment and services, and economic benefits to Canada.
Defence procurement is very complex and multi-faceted, and the defence procurement apparatus is making sound progress at addressing this complexity and delivering on multiple air defence procurements. Despite the challenges, we are making progress on key air defence procurements and solicitation processes. For example, we have recently achieved important milestones with respect to the future fighter capability project procurement process. We continue to work towards contract award for the future fighter capability project this year.
In February 2022, the final requests for proposals were released for the future aircrew training program and the remotely piloted aircraft system, RPAS, projects. Canada has also released a request for information for the Canadian multi-mission aircraft this past February. Canada is also advancing work to replace its CC-150 Polaris fleet with a strategic tanker transport capability. The contract award for full implementation is anticipated to take place in 2022-23.
In 2021, PSPC, on behalf of the Department of National Defence, awarded two contracts, valued at $186 million, tax included, for the purchase of three new tactical control radars and their in-service support for an initial period of five years.
Finally, in 2022, PSPC, on behalf of DND again, awarded a contract to an Inuit-owned company for the operation and maintenance of the North Warning System. The contract is for an initial period of seven years and is valued at $592 million. The contract also includes four two-year option periods for a total estimated value of $1.3 billion.
As we make progress on major projects, defence procurement continues to innovate to meet the needs of the Canadian military.
Until such time as new fighters are delivered and fully operational, there is a need to extend the life of the CF-18 aircraft. The Hornet extension project, HEP, will provide upgrades to avionics and mission support systems for up to 94 aircraft in order to meet new regulatory requirements and keep pace with allied military interoperability, and will provide combat capability upgrades for 36 aircraft.
To ensure there is no capacity gap until the new fighters are delivered and are fully operational, the interim fighter capability project acquired 18 Australian F/A-18 aircraft, associated spares and equipment to supplement the CF-18 fleet in Canada. All aircraft deliveries were completed in 2021. To date, six aircraft have been introduced into service after some minor modifications and it is expected that all aircraft will be in service by the end of 2022.
Of note, we are making increased use of the phased bid compliance process in projects like the future fighter capability project and the future aircrew training program to foster competition and best value to Canada by increasing the potential number of compliant bids, as PSPC continues to support the streamlining of defence procurement processes and DND in the execution of “Strong, Secure, Engaged”.
That concludes my opening remarks. Thank you all, once again, for providing me with this opportunity to speak with you this afternoon.
Thank you, Mr. Page.
We will now go into our first round of questions.
No, I apologize. I don't know who is speaking for National Defence. Is it both of you? Okay.
Go ahead, General Ménard.
Good afternoon, Mr. Chair. Thank you very much for the opportunity to speak with you this afternoon on air defence.
My name is Major-General Sylvain Ménard. I am the chief of fighter capability, responsible for managing the development of fighter, jet trainer and air demonstration aircraft. In addition to my current role, my experience extends across the defence portfolio, including experience with the North American Aerospace Defense Command, NORAD, as chief of programs and chief of military personnel, where I have participated in managing Canada's air defence team as well as being a leader within Canada's fighter force.
As the chief of fighter capability, I have two main responsibilities.
First, I oversee the continued development of existing aircraft to ensure current missions can continue to safely and effectively carry out their roles. This includes investments in regulatory upgrades for air navigation and communications, enhancements to ensure continued interoperability with allies and introducing limited combat capability upgrades such as improved radar and weapons.
This work includes introducing 18 former Australian CF-18s into Canada's CF-18 fleet. Additionally, the entire CF-18 fleet will receive regulatory and interoperability upgrades, while 36 CF-18s will also receive combat capability upgrades to include new radars and modern weapons. These upgrades, under the current Hornet extension project, will ensure a continued ability to support our commitments to NORAD and NATO while bridging to the future fighter capability.
Secondly, I lead a team that is progressing the introduction of the future aircraft systems and capabilities as outlined in “Strong, Secure, Engaged”. The introduction of the future fighter lead-in trainer and its associated capabilities will allow the RCAF to train future fighter pilots to the level necessary to move on the new advanced fighter aircraft. The new fighter aircraft itself will be a sophisticated platform that will require complex lead-in training to streamline pilot progression and preparation for the new fighter roles.
The RCAF is preparing to bring the new fighter capability to our squadrons and our members. This effort has benefited from many areas of expertise, including successful interdepartmental support, and in advance of a contract award announcement, we are preparing for the transition to a modern jet fighter that will be at the forefront of operations for decades to come.
Finally, I must recognize that, in all the work we do for the air defence of Canada, it is the people who are the strength of the organization, both programmatically and organizationally. The RCAF has focused the priority on our people over recent years, emphasizing comprehensive retention strategies, families and quality of life for our members as we focus on culture and change. The RCAF exists because of its people, and they are our most important asset.
[Translation]
Thank you again, Mr. Chair, for giving me the opportunity to address your committee.
[English]
I look forward to addressing any questions you might have.
I do, Mr. Chair. Thank you for the opportunity.
Good afternoon, everyone. My name is Troy Crosby, and I'm pleased to be speaking to you today in my role as assistant deputy minister, materiel, at the Department of National Defence. As ADM, materiel, I'm responsible for the management of the full life cycle of defence equipment required by the Canadian Armed Forces. This means from acquisition, through maintenance and support, to disposal.
I'm here today to discuss how the department is moving forward with the renewal and replacement of core equipment fleets, particularly in the context of air defence.
[Translation]
We are renewing and replacing basic equipment fleets to support Canada's multi–purpose, combat–capable defence force.
We are committed to providing the Canadian Armed Forces with the modern equipment they need, but we are also ensuring the best value for Canadian taxpayers, creating jobs, supporting Canadian technological innovation, and contributing to long–term economic growth across the country.
[English]
To begin, I will acknowledge that there have been significant impacts over the past two years due to COVID on both our procurement processes and the Canadian defence industry. These impacts have resulted from the sudden transition to remote or hybrid work, reduced or interrupted production capacity, restricted travel and border closures, workforce turnover and impacts to supply chains. These have all resulted in inefficiencies, scarcity of resources, delays and increased costs.
Despite these challenges, our team has continued to make important progress both on our “Strong, Secure, Engaged” projects and with the sustainment of in-service fleets.
[Translation]
The commitments made in Strong, Secure, Engaged continue to be our focus.
To put our work in perspective, the materiel group is currently leading 74 major procurement projects, 13 of which are valued at over $1 billion. Only these 13 projects together have a total procurement budget of over $100 billion.
[English]
National Defence works in close collaboration with our colleagues at Public Services and Procurement Canada and Innovation, Science and Economic Development Canada, as well as with the central agencies, to oversee these projects and the major in-service support contracts for the sustainment of in-service capabilities such as the North Warning System. Our capital acquisition work includes the procurement of a number of air defence capabilities for the Canadian Armed Forces, including the future fighter capability project, the interim fighter capability project, the Hornet extension project and the strategic tanker transport capability project.
Given the horrific world events that we have been bearing witness to recently, our job of sustaining and procuring equipment for our military is more important than ever. That includes, notably, our future fighter fleet.
[Translation]
In parallel with the significant progress we continue to make on the future fighter procurement, infrastructure design and site preparation work has begun in Bagotville and Cold Lake to prepare for the arrival of the future fighter aircraft.
These new fighter squadron facilities will house the tactical combat squadrons and the training squadron and will include spaces for day–to–day operations.
[English]
These facilities are being designed to leadership in energy and environmental design silver and net-zero carbon standards and have taken gender-based analysis considerations into account. There is already good progress in Cold Lake. It is expected that site services will be completed by spring 2022.
While work is progressing on the future fighter capability project and its supporting infrastructure, we're also investing in our current fleet.
[Translation]
To bridge any capability gap until the new fighter aircraft are fully operational, the department acquired 18 F/A‑18 Hornets from the Australian government.
All 18 aircraft have been received by the department and six have now been released to the Royal Canadian Air Force. Work on the remaining aircraft is progressing, with the eighteenth aircraft scheduled to return to service by June 2023.
[English]
Our fighter fleet is also undergoing various upgrades under the Hornet extension project, as you heard, including upgrades to avionics and weapons in order to meet operational requirements until 2032 and to maintain interoperability with our allies as we transition to the new fighter fleet.
These are just a few brief examples of all the ongoing work that demonstrates our progress in these uncertain times. As we continue to navigate through the global context, we're committed to moving forward on the defence investments outlined in “Strong, Secure, Engaged”.
It's important for us to keep these investments on track. This equipment will help to ensure that the Canadian Armed Forces are able to defend Canadians at home and work with our allies and partners abroad.
Thank you, Mr. Chair. I'll be happy to take the committee's questions.
Thank you very much, gentlemen. I appreciate that.
We will now start our questioning. We will start our first round with six minutes from Mr. Paul-Hus.
[Translation]
Thank you, Mr. Chair.
I want to greet the witnesses and thank them for joining us today.
My question is for Major General Ménard.
Major General Ménard, you talk about pilot training in your presentation.
How are you currently preparing pilot and technician training without knowing what types of aircraft we will have in the future?
Thank you for the question.
We are currently continuing with our joint training activities focused on the CF‑18 fleet. As we have mentioned, owing to the ongoing modernization of our F‑18 fleet, and to be able to maintain a reliable operational capability until our future fighters arrive, we are continuing to modernize and to increase our advanced operational capabilities.
Our pilots continue to fine-tune their capabilities and to align them with the new operational capabilities that will apply to the new fighters.
Okay.
Regardless of whether it is the F‑35 or the Gripen E, we are waiting to find out which aircraft will be selected before providing the training.
Is that right?
Yes, that's right.
We are still continuing to increase our operational capability through our investments. We are continuing to increase our capabilities, which will be compatible with the selected platform, regardless of which it is.
What we are investing in training for our aircrews will be applicable to the next fighter.
Thank you, Major General Ménard.
In 2017 or 2018, I went to the headquarters of the North American Aerospace Defense Command, or NORAD, to attend a presentation on the systems. They talked about the future aircraft we will need, which will have to be an integral part of what is referred to as the ultimate system owing to connections to satellites, ships, and so on.
We currently know that the government has made no decision on the next aircraft model.
What will be the impact of purchasing aircraft that would be integrated into this famous ultimate systems, considering the threat in the Arctic and the potential modernization of NORAD and of radar systems? Is it paramount for the new aircraft to be integrated into those systems?
Thank you for the question.
Regardless of which aircraft will be selected, it will have to meet the standards of the ultimate system, as you called it, to enable us to provide modern joint interagency air and space powers.
So the Royal Canadian Air Force will ensure that we can support NORAD, the North Atlantic Treaty Organization, NATO, or the Five Eyes appropriately.
For other more specific questions related to NORAD, I would invite you to consult NORAD authorities.
Okay.
Mr. Page, you told us that nine of the 16 CC‑295 Kingfisher aircraft have been delivered. I have been told that they are not operational. The aircraft have been delivered, but they do not fly and have been stored in hangars, as they are defective.
Is that correct?
[English]
Mr. Chair, thank you for the question.
[Translation]
Yes, we have received nine aircraft purchased under a contract with Airbus, in Spain. We are currently in discussions with the company to resolve technical difficulties we are having with the aircraft.
We are doing that to ensure to be able to get the certification and the necessary qualifications for the next steps and effectively integrate the CC‑295 Kingfisher aircraft into the Royal Canadian Air Force's fleet.
So we have brand-new aircraft that are not operational.
The CH‑149 Cormorant helicopters were also discussed. We have an issue with the company, Leonardo, over the cost of those helicopters. As they need an update, there is a difference in price, which the government is refusing to accept.
Is there any progress in that area? Those aircraft really have to be updated, as they are 20 years old.
Thank you very much for the question.
The file is moving forward. We are engaged in active discussions with Leonardo's representatives. The discussion process is fairly elaborate. We are currently considering a number of options to ensure a viable solution is found, which would be logical for aviation and would have economic benefits and a solid return on investment for Canadians.
I must say that those discussions have not been easy, but they are ongoing. We hope to move the project forward as soon as possible.
Thank you, Mr. Page.
Mr. Crosby, on March 21, 2022, president and CEO of the Aerospace Industries Association of Canada, Mike Mueller, wrote an article in The Hill Times, where he said that industry was prepared to work with the government.
However, as we too often see, coordination and efficiency are problematic in Canada.
Can things be changed or will we always be stuck in a vicious cycle of administrative problems, on the industry side or on the government side?
At the end of the day, even if we are investing more in defence, we are losing our money to needless fees or to a lack of effective processes.
Internally, are you telling yourselves that you should be better?
[English]
It's an opportunity to highlight some of the ongoing work we have through various industry association engagements and directly with industry through our procurement processes.
We work closely with the Canadian Association of Defence and Security Industries and the Aerospace Industries Association of Canada. They're members of what we refer to as DIAG, the defence industries advisory group, that Mr. Page and I are both part of, alongside Innovation, Science and Economic Development Canada, as well as individual representatives from various defence industry companies across the country. Those venues give us the opportunity to exchange information on our practices with respect to ongoing procurements and future potential improvements, taking into account industries' involvement in our Canadian work as well as our international experience.
Thank you, Mr. Crosby. I apologize for cutting you off, but we are limited on time.
If you have anything further to add to that answer, if you would provide that to the clerk, we'd greatly appreciate it. Thank you.
We'll now go to Mr. Bains for six minutes.
Thank you, Mr. Chair.
My questions are maybe best suited for our representatives from National Defence. I know the major-general mentioned the capacity of the jets and modernizing them. Can you speak to the capacity of both jets, the F-35 and the Gripen, to harmonize with the weapon systems of our NATO allies? Is one more compatible than the other?
Since we are in an open and transparent competition, I would rather not comment on any of the platforms. That is an ongoing competition at this stage.
What I can say, however, is that one of our high-level mandatory requirements is interoperability. Any platform that is still in the race at this time has to demonstrate that it will be fully interoperable with NORAD and NATO for what Canada needs. I will leave it at that.
Okay, I'll move on to the delivery.
What steps have been taken to help ensure the RCAF is ready to take delivery of the new fighter jets and reach operational capability?
As mentioned by Mr. Crosby earlier, there is some preparatory work that is being done both at 3 Wing and 4 Wing for the future fighter squadron facilities. This work right now is platform agnostic, so the preparatory work that we're doing will be able, in due time, to be tailored once we have a decision from the Canadian government. We're doing everything that we can do at this stage to prepare both on the training and on the infrastructure fronts so that the air force is ready to transition to the future fighter once it is selected. I would say that we are being as proactive as we can be, and we are eager to continue to deliver air power and joint space effects for Canada.
Okay.
I'm just going to go into the projects a little bit.
According to DND's 2019 defence investment plan, the department plans to invest $164 billion in capital projects on a cash accounting basis between fiscal years 2017-18 and 2036-37. Of this estimate, roughly $35 billion is intended for capital projects requiring authorities from Parliament between 2017-18 and 2021-22. How have DND's investment plans evolved since its 2019 defence investment plan?
There has been a lot of progress made since the “Strong, Secure, Engaged” defence policy was released in 2017. Since 2019, in some cases, projects have had some delays. However, we've also advanced some projects ahead of their originally intended timelines, such as the armoured combat support vehicle project, which is currently seeing delivery of vehicles well ahead of the initial timelines. We've also advanced the replacement of two of the older Challenger business aircraft that are part of the RCAF's fleet.
We have moved many projects through various phases and gates of the project approval processes. As I mentioned earlier in my opening remarks, we have 74 equipment projects currently under the materiel group's leadership in the phases that we are working on alongside our PSPC colleagues. These are projects for which we are developing the requests for proposals as part of the procurement process, or that have moved through to implementation. We're seeing delivery of equipment now.
We are seeing good progress. There are challenges. It's complex work, which COVID-19 has confounded over the past number of years, but we are looking forward to further progress.
Could you clarify what you mean, specifically?
There are a host of projects, as you'd be well aware. Some of those projects were quickly moved through approval gates right after the release of “Strong, Secure, Engaged”. Others, such as the Canadian multi-mission aircraft project, which is going to replace the CP-140 Aurora aircraft, had been planned for later in the program. It's a phased approach that meets up with the requirements to replace some of the legacy equipment.
In the longer term, there will be additional projects, including the updates and continuous investment in the fleets that we have in service today.
[Translation]
Thank you very much, Mr. Chair.
I want to begin by thanking and sincerely congratulating Mr. Crosby for taking the time to deliver his remarks in both official languages. He delivered over half his remarks in French, and I really appreciate that, as it does not happen very often.
Mr. Ménard, the CF‑18s currently need about 30 hours of maintenance per hour of flight. I would like to establish a comparison with the Australian F/A‑18s. How many hours of maintenance per hour of flight do those aircraft need?
Thank you very much for the question.
I don't know the exact number of hours required for maintaining our Australian aircraft, so I could not make a comparison with our Canadian CF‑18s.
However, I can say that, so far, the six Australian aircraft that have been added to the fleet have flown for over 800 hours. But 800 flight hours for six aircraft is not a lot. So I am not sure this would provide us with all the information we need to give you an exact number.
Thank you for your honesty.
Mr. Crosby, the aircraft that have been kept, both the F‑35s and the Gripen, are not air superiority aircraft.
Why didn't we opt for air superiority aircraft?
[English]
I can provide some initial comments, but this may be a question that my colleague, General Ménard, can address.
What I can say is that as part of the selection process, we've looked at the capability, as well as cost and the economic opportunities that come with each of the potential solutions. The capability lens considers typical fighter roles and missions that would be required and addressed by the Royal Canadian Air Force in the near and longer term.
Perhaps General Ménard has additional comments.
Thank you.
From an air force perspective, we identified the high-level monetary requirements for the aircraft. What we need for Canada is an aircraft that is multirole and that can be a good jack of all trades. At this stage, that's pretty much all I can offer.
We have a relatively small air force but a proud one and one that is renowned to be extremely capable for its size. Whatever platform we select, I think we'll be able to support it in all the roles we need the platforms to do.
[Translation]
Am I to understand that the army is interested in not only air combat, but also ground attacks with those aircraft, explaining the need to turn toward versatility?
According to Canada's defence policy, Strong, Secure, Engaged, we must fulfill our mandate as a NORAD partner and member of NATO. That does mean we have to be a versatile force in order to complete the missions assigned to us.
Thank you.
My next question is about drones, and it will be for Mr. Page, Mr. Ménard or Mr. Cosby.
Bagotville's specialization and its strategic geographic location are practically ideal for rapid air deployment toward the Atlantic, as well as toward the north.
Why have 14 Wing Greenwood and the Ottawa region been preferred over Bagotville for drones?
Thank you very much for the question.
If it's okay with you, I can answer part of the question.
The Royal Canadian Air Force has mandated a committee to perform a detailed analysis of a number of factors before selecting the locations where those new aircraft will be set up. Our country is very large. One of the things we considered is where those aircraft should be set up to cover the entire country. I remind you that Canada is the world's second largest country and that it is bordered by three oceans.
Those factors make it necessary for those places to be close to our area of operations. We also had to take into account infrastructure and the staff required to maintain those platforms. In addition, those places are close to strategic points in terms of command, control and intelligence, as well as all IT infrastructure, among other things.
At the end of the day, the goal was to cover as much territory as possible for Canada. Therefore, 14 Wing Greenwood, in Nova Scotia, and 19 Wing Comox, in British Columbia, were chosen. The main control centre will be established here, in the national capital region.
Gentlemen, I will have time to put other questions to you later.
I just think it's a shame for Quebec's expertise not to be taken into account in these kinds of decision–making processes. I understand that the idea is to share expertise, but this should not be detracting from anyone.
[English]
Thank you to all of you for being here today, and I'm going to leave it open as to who answers the questions.
The Liberals in 2015 campaigned against the F-35 to find a solution to better match the country's defence needs. Now that the F-35 is a front-runner, what's changed?
Maybe, as the entity here running the procurement process for this project, I can provide some light.
The future fighter capability project process continues to progress soundly. It is very active. Our mandate as a defence procurement apparatus was to conduct a fair, open and transparent competition with this project, and we have done so.
We have significantly advanced the competition that was launched in July 2019. This competition was launched through the release of a formal request for proposal to all eligible suppliers at that time.
The evaluation of the proposal was completed in late 2021. I think, as you were tracking, in early December 2021, Canada announced that we had two compliant bidders moving forward with the next procurement phase. The procurement remains very active and very live.
From a process point of view, that's pretty much all the information that can be shared at this time.
We've been a level three partner all these years. What have been the measurable economic benefits of that? Will there be benefit in the future?
With regard to the two compliance bidders we have left, bidders were assessed against specific compliance requirements. Both bidders now have acceptable levels of capability and value propositions. This means that, notwithstanding our next phase in the procurement and notwithstanding the eventual winning bidder, there will be economic benefits for Canada.
Discussing the specifics at this time cannot be done.
Thank you.
I appreciate that.
In terms of one of the advantages of the upgradability and their operability, can you talk about some of the upgrades? How do they make us dependent on other countries? Will there be a bill, for example, from Lockheed every year for software?
As well, how can Canadians be involved in the benefit of this?
Maybe I'll break the ice and turn it over to my colleagues from DND for the second part.
At this time, as the procurement process remains live and very active, we cannot assume anything about the winning bidder.
Okay.
What do you need in order to make your procurement succeed? What would cause us to fail, and how can we help address it? Basically, what has been your number one frustration in this process?
I must say that in the execution of this process, there has been very little frustration. As stated a bit earlier, we conducted a fair, open and transparent competition. We had a phased bid compliance process, which was embraced by industry. We're very happy with where we are. We're happy with the recent milestones, with the evaluation being completed, and moving forward with the next phase of the procurement. We are now just about to get to the next step of the phased procurement. There's no indication of failure and there's no frustration. We just need to keep going and execute the process soundly.
Thank you.
Could you perhaps talk about how often leadership has changed in this process? Will it change again in the near future?
Yes, there has been leadership change in the process, but because the process was very rigid and executed according to very specific rules, using a governance that was specifically applied to the project itself and overseen from a process point of view by the defence procurement strategy governance, we would be on solid ground if any other leadership changes were to occur.
We're moving forward. We're approaching some of the last phases of the procurement process. As I said, we're on solid ground and are just trying to execute the remainder of the program.
Thank you.
In terms of Canadian procurement, I mean, when you look around the world, we're criticized for being inefficient compared with other countries. Can you share your viewpoint on how we stand up against other countries in terms of our efficiency on procurement?
I have not done any specific analysis with respect to where we are comparatively with international partners or allies, but as mentioned in our intro remarks, on both the DND side and the PSPC side, we are very proud of the progress we have made here executing “Strong, Secure, Engaged”. With the release of key solicitation processes over the recent while, we are on track to execute the program as per current milestones.
Thank you.
Thank you, Mr. Page and Mr. Johns.
We'll start our second round with Mr. McCauley.
You have five minutes.
Thanks, Mr. Chair.
Gentlemen, thanks for your information so far.
A couple of weeks ago, we had PSPC in to discuss the estimates process. We asked a question from the press release regarding the jets. Over the coming weeks, Canada will finalize the next steps unless we re-engage bidders to provide them an opportunity to improve their proposals. We were told by PSPC that it could delay things for another year on top of the existing delays.
Whose decision is it, at this point, after six years of waiting, to perhaps delay things for another year?
This is part of the live procurement process that I spoke about. Canada is now further progressing the procurement process and we have enough to make a decision about either moving into a—
I'm sorry, sir. This is not progressing the procurement process when you're potentially delaying it.
Whose decision is it to perhaps delay it another year to allow the two remaining bidders to sweeten their deal?
I was just going to get there with the procurement process phase that we're contemplating now. The procurement process is now at a juncture where there's an upcoming decision about either moving into a dialogue—
It's a simple answer. Whose decision is it, please, to perhaps re-enter negotiations with the two remaining bidders?
This has been over a six-year process. Now we're hearing we may decide to award the project or we may delay it for another year to allow the two bidders to sweeten the pot.
Whose decision is that? Is it PSPC? Is it DND? Is it a political decision?
Whose decision is it, please?
This is a Government of Canada defence procurement decision, and defence procurement involves the three departments that are involved in defence procurement, so DND in this case—
Okay. Thank you.
With everything going on with Ukraine, and all the delays, we are still potentially looking at another year added before we make a decision. Is that correct?
As mentioned, the procurement process remains very live. Answering the question would have us lean one way, then, over the other, and I just don't want to answer it at this time to privilege the integrity of the process.
What are we doing different from our allies? This actually came up about four years ago when we asked it in this very committee.
Belgium took a year to decide on a fighter jet; Denmark took less than a year; Finland, three years; Japan, one year; and Poland, less than a year. Why does it take us six years to get to a point where we might delay it another year?
I refer back to this committee: “The Government...remains committed to building a more agile, better-equipped military, while ensuring best value for Canadians”. That was regarding the fighter jets. That was from June 2016. Now, six years later, we could be looking at another year's delay.
What has gone wrong here with our procurement process? You talk about how proud you are of the process, but it has been six years, with perhaps another year added on. We have pilots dropping out of the RCAF, and the PBO and the AG slamming the process, and we can't even get a simple answer as to when we're going to have a decision made. What is the problem here? What is the issue?
I realize it's complicated, but it has been six years, when our allies, with much smaller procurement departments, can make a decision within a year. Here we are, six years in, and it could be another year on top of that.
If we look at the precise window of time when the procurement process took form, through the release of the formal request for proposals and where we are now, I would argue that it has been effected and conducted very effectively.
As you mention, it is complex. It is multi-faceted. Industry is—
How much time has been lost due to political interference as opposed to the complexity of this deal?
I'm going to assume that the decision to delay it another year to have the two companies sweeten the pot is purely a political decision. PSPC tried to say it was the military, but this is for financial considerations, not what the military is asking for.
In my time here, I've been seeing the evaluation of all the proposals being brought home and the step that we conducted in December 2021, with moving forward with two compliant bidders. This has been a process that adhered to the highest principles of integrity. We maintain our standards. We respect the conducting of a fair, open and transparent process right up to contract award.
Thank you very much, Mr. Chair.
I've been following along with the excellent conversation and questions and answers, so I really do appreciate the testimony here today.
I want to just pick up really quickly on a question from my colleague from earlier in the conversation regarding the remotely piloted aircraft systems that are being purchased.
I understand that there are going to be about 240 air force members who will be staffing these systems. I want to know whether we currently have the staffing capacity for the remotely piloted aircraft systems or whether the recruitment will begin as we get closer to the date when those drones are delivered. I just want to see how the training and recruitment match the delivery of those aircraft.
I would like to start by saying that it is a new capability. We don't know exactly which platform we're going to get, so it is hard for us at this time to start training any air force personnel towards that mission. In any of these procurements, as soon as we have an identified platform, we will then put forward a training plan that will be effective in meeting both the initial appraisal capability and the final appraisal capability in due time.
That's pretty much all I can say at this time.
I will say, from an air force perspective, that these will be a brand new, shining capability, so I'm sure that we will not have any issues attracting people to go to operate these platforms.
I appreciate that, Major-General. That makes perfect sense to me.
I have a general question for those who are sort of uninitiated in terms of the process of how PSPC and DND work together. How do the two entities work together to ensure that we are procuring the equipment needed to support Canada's armed forces? What does that back and forth look like? What does the communication collaboration look like, in general terms?
I think the key enabler for our relationship, which is very rich and very continuous, is the defence procurement strategy governance that was established a few years ago in support of defence procurement. It brings to the table the client department, in this case DND and ISED, with PSPC at various levels depending on the complexity. The value of the projects has really been an excellent return on investment.
The conversations happen through the governance. We are able to synchronize on issues, specific requirements, specific appreciation of what the procurement will look like, how difficult this will become as a procurement, a solicitation process, and then specific variables such as procurement strategy and social and indigenous procurement points. We are able to synchronize and align early in the discussion, when the projects are still an option, and that assists in Mr. Crosby's lane. By the time we reach the time to execute an invitation to qualify or release a draft RFP, we know exactly where we're going and we know exactly what we're trying to achieve. We can then move forward in a swifter fashion.
Thank you.
That's terrific. I appreciate that.
I just want to pick up on your mention of the partnership and collaboration with indigenous communities. It's something I wanted to highlight. As outlined in DND's 2022-23 departmental plan, defence intergovernmental affairs is engaging indigenous women's organizations and elders as partners in the work to strengthen domestic and continental defence and to modernize NORAD.
This is an open question to any of the witnesses. Can you speak to collaboration and procurement, especially on procurement that's taking place with Inuit and indigenous partners? You mentioned before a contract being awarded on the maintenance of the North Warning System. Can you maybe speak about how that fits into DND's procurement plans?
I can speak a little about this. Through the same process that I just described, which is our defence procurement strategy governance process, as we capture the requirement and as we capture where the procurement will take place and where the contract will be conducted, we can also collaboratively involve other agencies such as Indigenous Services Canada and organizations that will look at such variables and factors, so they are also involved very early in the process.
Then we also have specific directives released by Treasury Board to the effect that, if the work is going to take place on the three comprehensive land claims agreements, we have specific obligations and specific requirements to inject into the procurement processes. This was done for the program that you just mentioned, the North Warning System, and we were very proud to award this contract to an Inuit company, the Nasittuq Corporation, very recently. We look forward to moving forward with them in the maintenance and operation of the North Warning System.
Thank you.
[Translation]
I will ask a number of rapid-fire questions, as I want to understand properly.
We currently have two aircraft left on the list: the Gripen and the F‑35. Canada has adopted various policies, including the industrial and technological benefits policy, and I would like to be able to make a comparison, as I want to make sure that all of Canada is well favoured for those projects.
First, where will each of those aircraft, be it the Gripen or the F‑35, be maintained, repaired and potentially updated?
Second, how many hours of maintenance will each of those aircraft require, in theory, per hour of flight?
Some commentators are looking down on the Gripen because it is a fourth generation aircraft, but can it not be Canadianized?
Is Canadianization included in the purchase cost?
Thank you for the question.
The tendering process is very active. Unfortunately, we cannot discuss either of the two aircraft remaining in the competition, not even generally. We must protect the integrity of the process, especially because we are approaching a key moment.
What I can tell you is that the two remaining companies, as well as the governments associated with them, regardless of their score, have shown that they meet all the requirements in terms of the three families of criteria: capability, costs—which include maintenance and acquisition—and the value proposition.
Regardless of the final solution, those three criteria will have been fully met.
I just hope that we are not purchasing aircraft that will be flown by Canadians, but that will belong to the Americans.
Providing training and doing maintenance and updates on aircraft here, and not in the U.S., is a significant value added. Otherwise, those aircraft will be paid by Canadians, flown by Canadians, but will belong to the Americans. It would not make any sense.
[English]
Thank you.
In the department's 2022-23 plan, it reads:
Defence Intergovernmental Affairs is engaging Indigenous women’s organizations and Elders as partners in the work to strengthen domestic and continental defence and to modernize NORAD.
Can you talk about the important benefits of engaging indigenous women and elders for continental defence and NORAD's modernization? Can you also provide some examples of areas where indigenous women and elders have strengthened NORAD's operations and where we are right now in that area?
The engagement with various stakeholder groups, notably indigenous communities, through a gender-based analysis plus lens ensures that we are taking into consideration different perspectives and reflecting the opportunities at hand in our procurement processes.
For example, in the case of the future aircrew training process, there was extensive engagement across the country with these various community groups to ensure that we would put in place opportunities where various communities could benefit as outcomes of the process. Another example is opportunities for skills development and, ultimately, employment opportunities across the country that reflect the realities of the local communities where equipment will be operated. This practice will continue in future procurement.
When we're talking about NORAD modernization, there's clearly opportunity there. Again, referring back to the Nasittuq Corporation contract award for the North Warning System and service support contract, we can see the strength of indigenous and Inuit businesses in providing support for the Canadian Armed Forces.
Mr. Chair, government targets have been established. We are aiming to ensure that 5% of the value of defence procurement goes to indigenous business. We're not there yet, but we have great opportunities. As we continue our engagement with these communities, I think we'll recognize additional opportunities that we can build into the procurement processes, both for new acquisitions where we can leverage for skills development or for direct participation, as I mentioned earlier, as well as—
Thanks very much.
The first question I have is in regard to the F-35 and in regard to industrial benefits and place in the production lines.
I'm just curious. In the last couple of years, how many dollars' worth of F-35 production have Canadian companies done?
Mr. Chair, I can provide some information about our participation in the production, sustainment and follow-on development phase memorandum of understanding for the F-35 program. Our last contribution payment was in the order of $70 million U.S. last year, almost one year ago. Over the period of time that Canada has been involved in the program, there has been a total of in the order of $2 billion U.S. of industrial benefit accrued to Canadian industry.
Thank you.
In regard to procurement, there's been a lot of talk recently in regard to the Ukraine conflict. I'm just going to fire off a couple of different items that are being used over there. I wonder if you could tell us if Canada owns any of them or if we're procuring any.
One is the Switchblade drone. Do we own any or have we sent any to Ukraine?
Mr. Chair, as a general answer, for reasons of sensitivity around our contributions, I'm not in a position to provide details about specific equipments or—
It's unfortunate to hear that.
You mentioned you have six Hornets from Australia in service. What does it cost per unit to put it into production?
Mr. Chair, the total value of the interim fighter capability project, to include the acquisition of the 18 aircraft plus two aircraft for spare parts, was $393 million. That also includes the investments to bring them into service, including phase one of the Hornet extension project, which addresses, as the gentleman mentioned, the interoperability and regulatory requirements.
Fair enough, but would you have a unit cost as to how much it's cost to date to get each one of the six into production? What is the average cost to get six of those into Canadian serviceability?
Mr. Chair, I don't have the breakout numbers by airframe.
We've established a budget for the entire investment. We're on track to deliver the entire requirement within that budget of $393 million, as I say, to include the acquisition and the updates of the aircraft to bring them into the Royal Canadian Air Force's service.
Could I please request a bit more information on the question? What do we mean by Arctic air defence? Do we mean within the NORAD umbrella?
I mean for the possible attack from any number of Russian areas, but just the ability for Canada to protect its own Canadian airspace in the Arctic.
For any specific NORAD missions, I would respectfully refer you to the NORAD authorities. In my capacity as the RCAF representative this afternoon, I just want to mention that the Royal Canadian Air Force, of course, generates the personnel to support the NORAD missions, so we train the fighter pilots, the maintainers, all the air personnel, the controllers, and all that. We give them to NORAD, and then they employ those trained personnel for their missions. It would be improper for me to discuss the NORAD capability—
I have one last quick question. Has the government asked you to start procuring items such as the Switchblade, the Stinger, the Javelin, etc., not only for our own defence capabilities, but to be able to contribute? I don't want you to say you can't say because of security or secrecy. I'm asking this: Have you, or are you going to?
Mr. Chair, very quickly, in case I transposed my numbers when I was responding to the earlier question, it's $339 million. I may have said $393 million at some point for the interim fighter capability project investment.
In terms of the question just asked, there are a number of projects in “Strong, Secure, Engaged” to include an anti-tank guided missile project, a ground-based air defence and other investments that will progress in order to deliver required capability to the Canadian Armed Forces.
Thank you for that.
Mr. Crosby, as I said earlier, if there is other information that you think you want to add to that, if you could provide that to the clerk, it would be appreciated. Thank you.
We'll now go to Mrs. Thompson for five minutes.
Thank you, Mr. Chair. My question is for Mr. Crosby.
On procurement, I want to just zoom in here a bit, just for more clarity. There are significant amounts of money involved here and obviously a very complex procurement process. I absolutely appreciate that in your opening comment you referenced that COVID has added another layer in the last two years, certainly, and the current world reality has made this probably even more urgent.
With that in mind, would you mind speaking about National Defence? When a request is made for new equipment, I'd ask you to break down the steps in the process to ensure that the RFP includes the requirements around transparency, because I'm certainly hearing today and in other sessions that an open and competitive process is sometimes questioned.
I'll break the process down into two broad steps. The first two deal with identifying a need and then developing the requirements in an options-analysis phase that's led by the sponsoring service, whether that be the RCAF, the navy, the army or the special operations forces. During that phase, the requirement goes through a number of review committees, including the independent review panel for defence acquisition, to ensure that we'll deliver a capability that fits in the overall capability set or requirement of the Canadian Armed Forces in the short and longer term.
Once the project moves into the definition phase, we work closely with our colleagues at PSPC and in other departments to develop the request for proposal to deliver on that requirement. Going back to an earlier question from the committee, we also engage in a very thorough way with Canadian industry participating in these processes, to ensure that the request for proposal is something they can respond to and understand.
Once we've gone through the competitive process and a contract is awarded, again we work closely with our colleagues in other government departments and with industry through the delivery of the equipment and right through the transition to the in-service...in replacing a fleet, perhaps, which includes the training that Major-General Ménard referenced earlier, making sure that a full capability is delivered. It's much more than equipment, as you can appreciate.
Just to follow along the same thread, there are timelines. I realize this is so complex that it would probably be challenging to say this takes a year or this takes five years, but I'd like you to speak about the realities or variables that can come up during the process that would affect timelines, and what would be a reasonable timeline.
As well, in closing, I'd like your thoughts on what could be put in place to tighten the process if, indeed, you feel there's even a need to tighten it.
Perhaps, Mr. Chair, I can provide some opening comments. Mr. Page may have something to add here as well.
It would be difficult to provide a generic answer. The procurements we pursue vary greatly in complexity. Some will move quite quickly through the process, and I think we've demonstrated well the ability to accelerate processes where the operational requirement has shown a need, as we've seen through COVID. Also, I mentioned a couple of the “Strong, Secure, Engaged” projects that have progressed well ahead of their originally planned timelines.
In other cases, such as the future fighter capability competitive process, it's very complex. There's a lot there that has to be addressed, and those processes clearly take longer, including through the industry engagement process and the period of time during which they're preparing their proposals.
The strength of the system right now is, as Mr. Page mentioned earlier in his comments, around the close collaboration between the government departments involved. There isn't a day that goes by—seven days a week, I think—that I'm not on the phone with Mr. Page at least once. We work very closely together with our colleagues to address the challenges we have and seek advice from industry where that's appropriate.
Very quickly, Mr. Chair, I think Mr. Crosby described it really well.
We're also keeping in mind today, as we procure materiel and equipment, other considerations such as social procurement, greening and indigenous procurement, as mentioned before.
Thank you.
[Translation]
Thank you, Mr. Chair.
My question will be for Mr. Crosby.
Mr. Crosby, in his recently published report on defence spending, the Parliamentary Budget Officer noted that last year alone, $1.3 billion had been returned to the state because the money had not been invested in defence procurement.
Could you tell us which projects were not executed due to lack of capacity or time?
[English]
Mr. Chair, the outcomes of last year's progress would be spread across any number of projects. Some of the spending that would have been forecast well in advance of even the last fiscal year would have reflected forecast delivery timelines.
In some cases, COVID and supply chain challenges have really been an impediment to industry. We've seen late deliveries of component parts and of supply that held up their production, and, of course, we pay once we've received materiel, so that is reflected in those lapses.
[Translation]
The COVID‑19 pandemic did indeed cause problems, and we understand that this may explain the situation. Earlier you said that, during the pandemic, we saw that the government could be very efficient, that everyone could really buckle down and work faster.
Due to the current conflict in Ukraine, have any ministers asked you to act more quickly to acquire military equipment or to make various purchases of urgently needed equipment?
Have you received any such instructions?
[English]
We are moving forward on our “Strong, Secure, Engaged” investments, and we respond to priorities as they're identified. In this case, if Ukraine has identified any specific requirements, appropriate authorities have taken a look at those, and we've been able to work with them to see what opportunities there are for us to provide support.
[Translation]
Let's say that the answer was very political.
The question is simple. Have the procurement officials at the Department of National Defence and Mr. Page at the Department of Public Works and Government Services been instructed to make purchases quickly?
Have you been instructed to expedite procurement processes for the different types of equipment needed to make Canada operational?
We know that Canada is deficient in this regard. Have you received specific instructions, yes or no?
[English]
Mr. Chair, at this point we have no specific activity that we're accelerating, but we are ready to do that as operational requirements might require.
[Translation]
Thank you for the answer, Mr. Crosby.
Mr. Page, I'm going to return to the issue of NORAD modernization and the famous contract that was awarded to an Inuit company. Giving $592 million in contracts to an Inuit company isn't an issue. But will this company contribute to modernizing NORAD, or is it simply going to conduct maintenance? We're having trouble getting details on that.
What will be the tangible results of this investment? Is it simply to conduct equipment maintenance? If so, please know that I don't have a problem with that.
In addition, is there any proposal to go further, given the threat emerging right now? This has been an issue for quite some time and I wonder if there are any plans to speed up modernization.
Do you have any comments on that?
Thank you very much for your questions, Mr. Paul-Hus.
I will speak to the first part, and then I will turn it over to the Department of National Defence team.
The contract awarded to Nasittuq is for maintenance and in‑service support of the North Warning System. It therefore does not include a modernization component.
For the second part, I will turn the floor over to my colleagues from the Department of Defence.
[English]
[Translation]
Of course, Mr. Crosby.
My question was on modernizing NORAD.
We know that the Inuit company is currently conducting maintenance, but are you planning to start any modernization initiatives soon?
General VanHerck, commander of NORAD, came in December and said that he is starting to lose patience.
What is Canada doing? Are you in the process of getting ready to move this file forward?
[English]
Thank you for repeating the question for me.
Budget 2021 did provide an initial $252 million over five years to support continental defence and NORAD modernization initiatives, including advancing research related to all domain awareness, sustaining the North Warning System and modernizing long-range communications capabilities. That work is ongoing.
[Translation]
Given that billions of dollars are needed to support these modernization initiatives, we obviously won't get very far with $250 million.
I'm done, Mr. Chair.
[English]
Thank you, Mr. Chair.
First and foremost, I'll start by thanking Major-General Ménard and the men and women of the Royal Canadian Air Force for their commitment to keeping Canada safe across all our borders, and the contributions of the broader Canadian Armed Forces in making sure that Canada remains safe and stays engaged internationally. Sir, thank you very much.
I'll continue on the topic of NORAD modernization. I believe this question will be for the Major-General.
In Canada's defence policy, “Strong, Secure, Engaged”, it is noted that Canada needs to remain agile and flexible within a global security environment that is complex and unpredictable. In the second report of the defence committee on aerial readiness, it also indicated that the advancement of new missiles with dangerous capabilities in terms of their precision and unpredictable nature constitutes an important new challenge to NORAD.
This is my question for the Major-General: Given the current global context, the ongoing threat imposed by Russia and Russian advances specifically in the hypersonic missile, how is Canada maintaining its flexibility and agility in terms of NORAD or other forms of preparation and protection?
Thank you very much for your appreciation of all CAF members.
I will highlight that, unfortunately, in my capacity as a representative of the Royal Canadian Air Force, I cannot speak on NORAD at this stage. As I mentioned earlier, the Royal Canadian Air Force trains and supplies the personnel and equipment to NORAD, and NORAD employs those forces readily, but unfortunately it would be improper for me in my capacity this afternoon to answer the question that you posed. I'm sorry about that.
Let me ask a follow-up question. You're preparing the men and women who will be supporting. There are two schools of thought around modernization: One is more around the update, and the other one is expansion, expanding the scope of NORAD.
Are you in any position to be able to talk about those two items as an expert?
Again, at this stage, I think it would be improper for me as an air force representative to comment on NORAD's steps forward and what NORAD intends to do for its modernization. I'm sorry I cannot provide more at this stage.
Okay. Well, thank you for that.
Let's go to the purchase of the 88 fighter jets to improve capability. In your opening remarks, I believe it was either you or Mr. Crosby who talked about the fact that we need to make sure we stay compatible with our allies. NORAD and NATO are our allies, especially the U.S. and Europe within NORAD and NATO, and especially when it comes to defending our northern territories.
How do those 88 fighter jets and their capabilities and platforms factor into the process to ensure, whether we go through modernization version one or modernization version two, that we'll be able to keep our northern borders secure?
I'm willing to take an answer from anyone.
I would like to say that the 88 fighters that the RCAF has identified as the magic number, if you will, are based on the mandate that has been given to the Royal Canadian Air Force in Canada's defence strategy, “Strong, Secure, Engaged”. We went into a detailed analysis. This amount of aircraft will enable us to fulfill our mission requirements, first for NORAD, then for Arctic sovereignty and things of that nature, and for NATO, as well. It will also ensure that we can make a meaningful and credible contribution to our Five Eyes partners.
This is what I have to offer at this stage.
I think I have about 10 seconds.
Is it fair to say that, regardless of the platform, whether we go with Saab or with the F-35, the capability is there?
The Royal Canadian Air Force put in its operational requirement the high-level monetary requirement that we need for operational capability. Interoperability is right up there with our NORAD and NATO partners. I expect that any platform that is selected will meet that high-level monetary requirement. It's a fundamental requirement for the Royal Canadian Air Force.
[Translation]
Thank you very much, Mr. Chair.
Mr. Crosby, regarding the purchase of the Australian F‑18s, is Canadianization included in the total price of $339.3 million, yes or no?
[English]
[Translation]
Thank you.
In your opinion, Mr. Crosby, is the aerospace industry a strategic industry for the federal government right now?
[English]
The Canadian aerospace industry is a world leader in many domains and provides very important support to a number of our fleets across the country. I see it continuing to do that well into the future.
[Translation]
Thank you.
Mr. Ménard, just between us, be honest, which plane would your guys like to work with?
We know that our current planes are outdated, which explains some of the recruitment problems. No one likes to play with old toys, be they two or fifty years old.
Which fighter aircraft do your pilots prefer?
Thank you for the question.
I will say that all airmen and airwomen in the Royal Canadian Air Force are looking forward to the decision and to working with the new fighter.
At this point, it would be inappropriate for me to give an opinion as to what type of aircraft the airmen and airwomen of the Royal Canadian Air Force want to fly, since Canada is in an open and transparent process.
I'm going to talk briefly about recruitment problems.
As I just said, we agree on the fact that no one likes to play with old toys. It is possible that youth are less attracted to the military because of problems with equipment.
That being said, do you think the upcoming announcement about purchasing fighters will increase youth interest in military aviation?
What will you do to increase interest?
Thank you very much for the question.
I want to say that at the Royal Canadian Air Force, our organization has no shortage of candidates who want to become airmen and airwomen.
Of course, in the last few years, due to the pandemic, it has been a little more difficult to recruit people because of all the public health measures in place. Having said that, we don't generally have a problem in terms of attracting staff.
I can't speculate on what effect the announcement of a new aircraft will have, but we at the Royal Canadian Air Force are certainly looking forward to hearing the decision. There's no doubt that new equipment of any kind is always more appealing to the new generation.
[English]
Thank you, Mr. Chair.
One war and battle that we don't talk enough about is the war against climate change. We know that the military has stepped up, and we are all grateful, whether it be with the floods, or last summer when 350 military personnel helped tackle fires that were raging across the interior in British Columbia and Manitoba.
What is DND's goal in terms of helping tackle this war we have against climate mitigation and change, and the fires? We know it has downloaded the primary responsibility on the provinces.
I think about Coulson Aircrane Ltd., a company in my riding, which is a global firefighting leader, especially when it comes to night firefighting capacity. They are in Australia, Argentina, the United States, Chile and Bolivia, but they are not doing business here in Canada. They could help us put out fires that are raging and would be helping tackle climate change by putting them out quickly. It's that Canadian story of Canadian companies not getting procurement from the government that could help us take on these huge issues.
Maybe, Mr. Page, you can help with this because it is defence-related, DND-related. My question is why in Canada does the military not support aerial firefighting capabilities with C-130s, CH-47s and Black Hawks? This is common practice in the United States.
Maybe you can tell me whether you are considering it or looking at it, because I think it would be very important for the federal government to take leadership and help support this really important need.
In terms of the word “need” here, I don't want to shy away from answering a question, but I think I will defer to my colleagues in DND.
In PSPC, when we execute a solicitation process, we get the requirement from the client, in this case DND, and then we look at how to execute the solicitation process.
I think that is what's happening right now. The provinces are making requests and the federal government is stepping in, but why isn't the federal government getting ahead of it, playing offence, and actually assuming the responsibility of night firefighting capacity, for example, working with companies like Coulson and actually being there on ready and on standby to help support provinces? We know it's going to get worse and we know a lot of provinces actually don't have capacity.
Is this something DND is considering and looking at?
Thank you, Mr. Chair.
I will defer to my DND colleague here. In PSPC I'm responsible for the defence and marine branch, and that requirement is not being tracked at the moment.
Thank you, gentlemen.
Unfortunately, timewise we need to move along.
We will go to Mr. McCauley for five minutes.
Thanks, Chair, and thanks, gentlemen.
Can you update us on this issue with the C-295 Kingfisher? There were centre of gravity issues and, I guess, issues about the inability of search and rescue to parachute out of the back of the plane.
I'm curious as to why we took so long to procure. How did we end up with planes being delivered that can't be used?
As is typical in our procurement processes, once we are in a contract with a provider, of course, we start to work much more closely. We move through the process of ensuring that the equipment meets the contracted operational and performance requirements, and we conduct testing and ultimately—
This is a mature design, a long-existing design. How did we end up with planes that have centre of gravity issues? It's not a new build.
Mr. Chair, the C-295 is a mature aircraft. The aircraft that we have for our fixed-wing search and rescue requirements has been modified to fulfill the operational requirement for fixed-wing search and rescue, as was mentioned in the question, to include the ability to have parachutists, search and rescue technicians, safely exit the aircraft to conduct search or rescue operations.
That testing is under way right now, and we have successfully and safely demonstrated the ability of the parachutist to exit the aircraft.
Specifically in terms of the question around centre of gravity issues, all aircraft have centre of gravity considerations and they are dealt with through appropriate operational procedures.
Were you expecting these problems in advance, then, if all airplanes have centre of gravity issues, as you just stated?
Not necessarily. I have to correct myself if I said that. It's not centre of gravity issues. They're considerations in how the aircraft is safely operated by the crews.
How modified have they been from the existing design, then? These planes have been around for a long time. I remember reading that the RFPs were a hundred thousand pages from the three companies. We covered every possible outcome for modification.
How did we end up with planes that can't be used or are being so delayed for years?
Mr. Chair, some of the modifications that are being brought to the C-295 for our application include Airbus enclosing the landing gear. In the older model C-295, you would actually see the wheels protruding below the belly of the airplane. Given the range and endurance requirements for our fixed-wing search and rescue role over our huge territory, Airbus has put enclosures around the wheels to increase the aerodynamic efficiency of the aircraft.
Who's paying to get these up to speed so to speak, or up to code, so that they can be used? When will we actually see them in service, and in what numbers?
Mr. Chair, the procurement process and the proposal that was provided by Airbus included the cost of these modifications, which go beyond the ones I've described to date and include bringing mission systems specific to the fixed-wing search and rescue role [Inaudible—Editor] search radar—
Right. You're saying these delays for the centre of gravity issues and the issues of parachuting out the back will not cost Canadian taxpayers one penny.
The cost of any modifications or testing followed by modification would be with Airbus. Of course, we continue to invest time and effort in the process and we want to see it conclude as quickly as possible.
The initial operating capability timelines for the aircraft have been reviewed recently. We're going to see an extended timeline in order to see those aircraft in use.
Maybe you can send the committee a note in writing about the timelines.
I think you or one of the other witnesses commented earlier about difficulty negotiating with Leonardo regarding contracts for fixing the Cormorant. Is that correct? Did I hear right?
I recall that Leonardo sued us for the bid on the fixed-wing search and rescue. They got a sole-source contract worth billions to work with the government. Now they're making things difficult for us on fixing these vital helicopters.
Mr. Chair, just to clarify, there is no contract at this point for the Cormorant mid-life upgrade project.
I would ask Mr. Page if he has anything he'd like to add on that.
Thank you very much.
Mr. Page, if you have anything further that you can add to that, we'd appreciate you providing that to the clerk.
I will now go to Mr. Housefather for five minutes.
Thank you very much, Mr. Chair.
I want to thank the witnesses. I think recently we have all been so moved by what is happening in Ukraine that we see the vital importance of the work that you do every day to make sure the men and women of our armed forces have the equipment they need to function and thrive.
I'm going to try my best not to get into the contract itself, because I understand there are still two finalists and we can't favour one over the other. We can't say things about the F-35s that we can't say about Gripen E.
One thing I want to ask is, when does the Department of Defence determine that you need capabilities outside of the generic plane that would normally be sold? For example, the U.S. military would use the F-35 Lightning, too. When would we determine that the Canadian Armed Forces would require something different from the generic plane being used by other allies?
As I mentioned earlier, the Royal Canadian Air Force is really keen to deliver on its mission set that has been dictated to us by “Strong, Secure, Engaged” in Canada's defence policy, so our goal is to make sure we meet Canada's expectation of its Royal Canadian Air Force.
That said, one of the primary roles for our air force is to be interoperable with NORAD, NATO and Five Eyes partners. That's why we have put that in place in our requirements and we expect that the aircraft we will purchase for the future fighter capability will be interoperable and meet those missions.
Now, if for some reason Canada wants us to evolve or change our role, we will have to look at the requirements at that stage and then we would make an operational deficiency report. We would engage with ADM(Mat) colleagues and then PSPC to find a solution on that front.
From an air force perspective for operational requirements, that is how the air force would select a specific operational requirement that it needs. It's based on what we've been tasked with by our government.
[Translation]
Thank you, Mr. Ménard.
[English]
If nobody else has anything to supplement that with....
I guess the point is that when you're buying the generic equipment, the equipment will be cheaper and will probably come faster than when you're customizing it. I think it's something interesting to look at each and every time.
Can we talk about the process for the fighter jets?
Mr. Page, by the way, it has always been a pleasure to work with you and the department.
How has the risk been mitigated by the type of process we've done, in terms of the lengthy process of vetting suppliers and bringing it down as we have right now?
I think we have done this risk mitigation piece that you're talking about in various ways. For me, probably the most prevailing way was the engagement with industry. Right from the start, well before the release of the request for proposal, we had a very rich engagement with the suppliers about Canada's requirements. We engaged them throughout with mandatory and rated requirements.
As I said, we engaged them well before the RFP was released. There was a publishing of the draft RFP, and then eventually also the use of the phased bid compliance process.
Even after the submission of their proposal, we maintained a dialogue with those who submitted bids, to make sure we had a very relevant competition that was, again, conducted in an open, transparent and fair fashion.
In terms of evaluating the bids right now, in terms of looking at the two suppliers that are left and determining what the next stage will be, if we go with one or if we continue talking to both, would it be true to say that there are people from both departments and possibly another department involved in the process?
For example, Madame Vignola asked a very good question about what the pilots want, but wouldn't the Department of Defence and their wishes be represented at the table in the group of people who are evaluating these bids?
The bid evaluation piece was conducted under a very specific and, again, a very rigid governance established only for the evaluation of the proposals. These evaluation teams, multidisciplinary teams, involve members of the Royal Canadian Air Force, members of the materiel group represented by Mr. Crosby, members of ISED and members from my department.
From a process point of view, the entirety of the process was overseen by the defence procurement strategy governance at the ADM and DM level. A very limited number of people would have had access to the entirety of the evaluation and would have known where the entirety of the evaluation was going. We also used a fairness monitor throughout to make sure we were doing the right things, again in an open, fair and transparent manner.
Thank you, Mr. Page.
We've now finished our third round and we're about to now start our fourth round.
I want to thank the witnesses who are here.
With respect to the time, we're going to one quick, rapid-fire round right now.
I'm going to allow for one question from the NDP and the Bloc and two questions from the Liberals and the Conservatives.
There's a time limit on this, so I will cut you off right at that time.
We'll go with Mr. Johns for one question, please.
Okay.
I asked a question earlier about our capability in air defence in the war against climate change.
I think, Mr. Page, you deferred to your other colleagues, whether it be Mr. Crosby or whoever else may answer it.
Right now, Canada has invested $3.4 million in Coulson enterprises, the company I talked about earlier, through the strategic innovation fund, to modify their Boeing 737 plan. It has a dual purpose, both for aerial firefighting and for tanks and passengers.
I asked why Canada is not using the military to support aerial firefighting capabilities. Is this something you're considering or looking at? We know there's a huge gap and there's a need for federal leadership, and you've got a global company like Coulson.
In the current defence and marine portfolio, such requirements are not present.
My assessment and my understanding of such requirements is that they are generated at the provincial level. My branch, defence and marine procurement, deals with federal clients, including DND, the Coast Guard, Transport and the RCMP.
Thank you.
[Translation]
Ground-based air defence is expected to include several components which I will not list, but the cost should be between $250 million and $499 million.
First of all, what accounts for this overall gap of $249 million? Secondly, when does the government hope to see this defence commissioned and operational?
When I talk about ground-based air defence, I'm talking about one or more effector platforms, munitions, a sensor suite, fire control software, and an integrated C4ISR networked system, costing between $250 million and $499 million.
Why is there a $249 million difference?
When will this system be purchased and when will it be operational?
Thank you for the clarification.
The ground-based air defence system is the responsibility of the Canadian Army. So as an airman representing the Royal Canadian Air Force, it would be difficult for me to answer that question. I'm sorry.
[English]
Mr. Chair, I think I can help with a quick response there.
The bands of potential build costs are meant to inform where the investment could lie, but until we move further through the process, the exact figures will continue to mature.
Thank you, Mr. Crosby.
At some point in time, if you can provide the committee with further answers I'd appreciate that.
We'll now go to Ms. Thompson for two questions.
Thank you, Mr. Chair.
Mr. Page and Mr. Crosby, I'd like to go back to a comment you made in my last round, which I thought was really quite interesting. You both referenced working collaboratively and working across departments, versus a more siloed approach.
It led me to go back to something that I had been reading in preparation for today. There are observers who believe that defence procurement strategy governance will improve procurement processes in Canada in terms of transparency, accountability and efficiency. Likewise, there are commentators who believe that the processes would be improved in a more centralized defence procurement approach, under a single defence procurement strategy. I believe this was in place in 1969, when we moved to a more open system.
A centralized approach would create a significant shift in the way that procurement defence occurs across Canada, ending five decades of a multidepartment strategy. I'm really interested in both of your thoughts on both sides, the multidepartment strategy and then a more centralized strategy. This is all in a need to look at improvements or more transparency and accountability.
Maybe I can start quickly and then give the floor to my colleague, Troy.
Without characterizing it as centralized now, what has been created under the defence procurement strategy and the governance system we have now is very close to a centralized model. The various pillars of defence procurement are properly considered, and there are healthy discussions about the various pillars and how they should be managed as we execute a procurement process. These pillars would be the capability that will come from the client, the performance, the value for money and the economic benefits.
At these governance meetings that we have, we also have central agencies with us that will provide their consideration and their concerns immediately at the outset of a procurement, and then throughout, which also adds to the centralized variable of the model and to its efficiency.
I would quickly add that we work, as Mr. Page has said, very closely on the more complex, typically high dollar value programs. That said, National Defence has quite a level of delegated authorities. The vast majority of our procurements—the lower dollar value, less complex activities—are managed within the Department of National Defence so that we can concentrate our time and effort with our interdepartmental colleagues, where they have the most value.
[Translation]
Thank you, Mr. Chair.
Major-General Ménard, you've been in the Canadian Forces for a very long time and you've come up through several ranks.
As a major-general, do you have any advice for the committee on military procurement projects? I'm not playing politics here, because you've served under both Liberal and Conservative governments.
What advice would you give us, as part of our study, about air capability, but especially about the military procurement process?
Thank you very much for the question.
I want to thank the committee for the work it is doing. When we see what is happening in Europe right now, we are fortunate to have the government structures we do, which demonstrate considerable intellectual rigour.
I am not a procurement expert, and I would prefer not to comment on what could be improved or to give your committee advice. It would make me uncomfortable.
Thank you, Major-General Ménard.
The Boeing Super Hornet was removed from the competition. What criteria informed this decision?
[English]
[Translation]
Thank you for the question.
Without going into detail, I would say that all of the companies involved in the bidding process had to prove that they met established criteria before moving on to the next stages of the process.
Boeing did not meet one of the criteria and that is why they were excluded from the process.
[English]
Thank you very much to the witnesses. We really appreciate your being here.
Mr. Cosby, Mr. Page and Major-General Ménard, thank you to all three of you for bearing with us as we went a little longer than we originally scheduled. We appreciate your attending, as we appreciate it every time you appear before us, so thank you.
I'd also like to thank the interpreters and the technical staff who have been working with us here today and bearing with us as we go, as well as our analyst and our clerk.
I have just one last thing for the committee. I've been asked whether the committee might be interested in doing a tour of Centre Block. If that is the case, please express that to me, and then I will relay that and we'll see if we can arrange it. We would do that as a committee, if you're interested.
With that said, I declare the meeting adjourned.
Publication Explorer
Publication Explorer