National Defence Committee on May 6th, 2024

[Emmanuella Lambropoulos, Liberal, Saint-Laurent, QC]

Are you of the opinion that Canada is already doing a good job of making sure that's happening or is there something more we could do to help promote what's being made in Canada?

[Mike Greenley]

We have had some good experience doing this in the past. I think there is a worry bead out there right now. If we look at domestic—like army, navy or air force—military activity right now, there seems to be a bit of a push to make sure that having interoperability and interchangeability with the United States means that we use U.S. systems a bit more. We're starting to see that with several procurements right now. We would not want to see that transition into space. We want to continue to leverage our space capability and to be interoperable using Canadian systems and not by procuring American ones.

[Emmanuella Lambropoulos, Liberal, Saint-Laurent, QC]

I guess I'm going to open the floor to all the witnesses for this next question.

The Minister of National Defence came before our committee and noted that Canada's new defence policy is also an industrial policy. Earlier this year, at Aerospace on the Hill, Minister Champagne mentioned an aerospace strategy that would eventually come into play and that the government is starting to consider.

What role do you think your industry could play in this? How do you think this strategy would look for the companies represented here today? How would you contribute to this strategy?

[Michele Beck]

We were quite pleased to see the new defence policy being issued, and we're quite excited by the fact that the government recognizes as well the importance of space to the space defence policy. The industry is innovating at a very fast pace by making services, technology and capabilities available faster, at a lower price point, with probably greater capabilities than governments can move.

We feel that, from a supply perspective, we should be relied upon. We've got expertise that we have been developing for the past 55 years in the sector, and we can provide guidance, consultative services and insight in terms of these capabilities. We welcome the opportunity to work hand in glove with the government to advance these types of services and capabilities.

[Brian Gallant]

On the defence policy review, I just want to echo the comments of Michele. As an industry, we were very excited to see the way in which space is being talked about in the defence policy update and very happy to see that there's a clear recognition of the importance of space to national defence and security.

In terms of the strategy—the defence policy update, if you will—being an industrial plan, it isn't necessarily reflected in the written words of the plan, but I can certainly attest that in discussions with the department and even more specifically with the minister that clearly is the intent. It is certainly something that is supported. The idea that the defence policy update will be a way in which we can further engage and develop the industrial base for space we think would be important.

In terms of having an aerospace strategy, of course on paper the idea of having a strategy and a robust exercise to develop it certainly makes sense. One flag that we certainly would have is that space often risks being lost in the shuffle, as an afterthought, or as just not as much of a priority, when it's lumped in with the sort of general term of “aerospace”. That would certainly be a flag and a worry for industry.

[The Chair, Liberal, John McKay]

Unfortunately, we're going to have to leave it there.

“Space has the risk of getting lost in space.” That was really bad.

Madam Normandin, you have six minutes, please.

[Christine Normandin, Bloc, Saint-Jean, QC]

Thank you very much, Mr. Chair.

Thank you to all the witnesses.

Mr. Gallant, you said that Canada should among other things accelerate the implementation of identified space programs. I would like to know what exactly that means. What would that acceleration involve?

[Brian Gallant]

Quite simply, it means that the procurement process should be faster. I reference things happening outside our organization, but in terms of procurement related exclusively to defence, people are already complaining that it is too slow. For the space sector, the rapid pace of innovation is an additional challenge. If the procurement process takes ten years from start to finish, the service or space product that the government ultimately receives might be obsolete, unfortunately, given the rapid pace of innovation, and since other countries or individuals might have more advanced systems.

[Christine Normandin, Bloc, Saint-Jean, QC]

Thank you very much.

Ms. Beck, in your opening remarks, you said that Canada has a clear competitive advantage over other countries. What does that mean? In what way is Canada competitive? We know that Canada does not have a launching station for military satellites, for instance, so what is Canada's advantage?

[Michele Beck]

Our advantage is in the telecommunications industry.

Our company has been in business for 50 years. We operate satellites for government and for commercial purposes alike. We are in the process of developing a low-earth orbit satellite constellation. This constellation will offer services that cannot be compared to those of the geostationary satellites that we had in the past. This is something new. We offer very secure and very resilient low-latency services that the government, and in particular National Defence, can use to support operations not only here in Canada, but right around the world. It is a global constellation. This capability already exists, and we are now developing the constellation. Being able to offer those services directly here, in Canada, gives us a competitive advantage.

[Christine Normandin, Bloc, Saint-Jean, QC]

I gather you are referring to Telesat Lightspeed, and I would like you to reassure us a bit about that.

Last year, the Globe and Main reported that Standard and Poor's had downgraded Telesat's rating, and that various governments had invested a lot of money in the form of loans or equity capital. Some Standards and Poor's analysts have said that by focusing on Telesat Lightspeed, your company might have put all its eggs in one basket.

Where do things stand a year later, financially speaking? How is the company doing?

[Stephen Hampton, Head, Public Policy and Strategic Accounts, Telesat]

In August last year, we announced that we had entered into a contract with MDA Space to build 198 satellites. We have funding arrangements in place to be fully funded. Since August, we've hired almost 150 people. We're looking to do significantly more this year. We're investing tens of millions of dollars. I think our capex guidance for this year is almost $1.4 billion, so we are off to the races, and very excited about the future.

Michele, Brian and Mike have spoken to how the space sector is exploding around the world. Having a global, low-latency broadband network is truly a differentiator. From customers here in Canada and all around the world, we're hearing, “We need this. We need this. We need this.”

We're very excited and very optimistic about the future.

[Christine Normandin, Bloc, Saint-Jean, QC]

In one minute, can you tell us how much progress has been made on Telesat Lightspeed? How are things going? What is your timeline?

[Stephen Hampton]

We'll start launching satellites in mid-2026. We'll enter global service toward the end of 2027, and then we'll continue adding satellites from there. That's the timeline.

[Christine Normandin, Bloc, Saint-Jean, QC]

Thank you.

Mr. Chair, I will use my remaining 40 seconds later on.

[The Chair, Liberal, John McKay]

You have 30 seconds. I'll pass them over to your next round.

Madame Mathyssen, you have six minutes.

[Lindsay Mathyssen, NDP, London—Fanshawe, ON]

Thank you all for attending today.

A lot of you have spoken about this incredible opportunity for Canadian jobs. I wanted to ask about the jobs that are currently held through MDA Space. Unifor has been on strike since April 8. Its members are incredibly proud to be part of the production of those satellites and putting them into orbit.

Can you talk to us about the fact that MDA Space won't meet their demands for a cost of living adjustment and a fair pension? Can you talk to us about what you're doing and what steps you're taking to get back to that table and provide the incredible workers who do those jobs what they're asking for?

[Mike Greenley]

MDA Space has a great workforce. We're up over 3,000 people now. We had about 1,700 people when I started six years ago. We crossed the 3,000 line this year. We hired 900 people last year. We'll hire over 1,000 people this year. Certainly, the growth in space is turning into good jobs.

We have a history, as a company, of being able to work with all kinds of employees, both represented and non-represented employees, and I feel we have a very good human resources framework in being able to do that in terms of total compensation, our salaries and our benefits programs, which are actually very good.

I won't comment specifically on an active negotiation, but we do respect, certainly, the represented workers' desire to go on strike and to express themselves that way as part of the process of dealing with represented workers. We're optimistic that we'll come to a solution here as we go through the next few weeks.

[Lindsay Mathyssen, NDP, London—Fanshawe, ON]

One thing New Democrats have done recently was our motion on Palestine, which included ending military exports to Israel. Of course, many Canadian civil organizations have tried to track and report on Canada's arms export and trade regime. A lot of what we export goes towards Israel's space program. Have you—and I think I'll take that to Mr. Greenley and Ms. Beck—received anything from the government in terms of what the government promised, that the House would issue the notice to exporters and the ending of those exports? If you have any indication, received any communications from government or have any connection with that, I'm just curious about progress on that motion.

[Mike Greenley]

For me personally, we have export control teams in the company that deal directly with the government every day. Anything we export has to have the appropriate export permits from the Government of Canada, so that interface is there. I don't see all that daily traffic, so I honestly can't answer. I have not personally seen anything, but I wouldn't, normally: The export control teams would see that.

[Lindsay Mathyssen, NDP, London—Fanshawe, ON]

Is this something you can report back on to the committee so we that can see if the government is following through on their commitments on that?

[Mike Greenley]

I can certainly go and ask, yes.

[Lindsay Mathyssen, NDP, London—Fanshawe, ON]

Ms. Beck.

[Michele Beck]

Yes, likewise we do have an export control working group as well at Telesat, but to our knowledge—and I just checked with Mr. Hampton—we haven't heard of anything coming in to the company, but we'll take an undertaking and get back to you.

[Lindsay Mathyssen, NDP, London—Fanshawe, ON]

Thank you very much.

The relationship we have with the United States in terms of that space domain has been strained at times because of the Americans' policies on foreign entities, like Canadian companies, for example, accessing the infrastructure and technologies they have. I ask this in terms of some of the commentary around the national space council: Is that something you believe that council could help to negotiate? Do you have any other recommendations in terms of that limit on the barriers that, mainly, the U.S. government—because it is so dominant in this field—has in terms of Canadian participation, sharing of data, that sort of thing?