Government Operations Committee on April 5th, 2022

[Prof. Kim Nossal]

I think that the proof will be in the pudding, as they say. I don't know whether or not, in future procurements, we're going to see a reduction of the political games.

I'm not here, by the way, talking about political interference. As our colleague Jim Fergusson said to you, all procurement is political. I'm talking about turning a defence procurement project into a political football. Let's put it this way: We'll see whether or not future generations of politicians will be able and willing to avoid the temptation of transforming this into football.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

Finally, I'd like to get some of your thoughts on the F-35 and its improvements. Do you have any insight on how they may have improved and what that would mean for their capability?

[The Chair, Conservative, Robert Gordon Kitchen]

Excuse me for interrupting, Mr. Bains. The time has actually ended.

Mr. Nossal, if you got that question, it was a great question. If you could provide an answer to us in writing, it would be greatly appreciated.

Thank you very much.

We'll now go to Ms. Vignola for six minutes.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you very much, Mr. Chair.

Mr. Huebert and Mr. Nossal, my first question is for you.

You have both emphasized how harmful the politicization of defence procurement has been, and still is, both to national security and to financial security. You also talked about how Canadians' and Quebeckers' taxes are being used.

I would like you to tell me what a non-politicized and completely neutral procurement process would look like. I would like each of you to answer my question within a minute. I know that is very little time for such a huge task.

[Prof. Kim Nossal]

If you want a really good example of a process that was free of this kind of politicking, look back in history to the time when the Government of Canada replaced a number of fleets of jet fighters with the CF-18 Hornet. The Liberal government of Pierre Elliott Trudeau managed that particular process excellently, and it was not at all politicized except right at the very end when the Parti Québécois government of René Lévesque was involved. Essentially, I think that still remains, after all of these years, an excellent example of a depoliticized process.

[Dr. Robert Huebert]

If we're looking for a process, the identification of a threat has to be central. Once again, on something that Richard said, the manner in which we look for platforms is also part of the problem. That gives further temptation of the politicization.

What we need to understand is that when we talk about the replacement for the F-18s, we're talking about providing for Canadian security in an increasingly dangerous aerospace environment. I think that you have an educational process. This is not about making jobs. This is about giving security, and that has to be something that is constantly rammed home, again and again.

The second process is, of course—and we saw this, to a certain degree, with the creation of the shipbuilding strategy, which we'll talk about in the next hour—that you create independent capability of your experts. Basically, you have the politicians' promise that we set the parameters of what you have to do, come back and tell us, and make sure that what they tell is of course shared publicly, so that there is no suspicion in terms of “the fix is in” on it.

Once you have that decided upon, and once you make the decision on the platform that you are buying, you take a lesson from what the Finns have done and what the Danes have done, and that is to simply say, “Okay, we will now let out air force go and negotiate with the Americans”, or whomever you are negotiating with. You have to have the product. It has to come back, and it has to present into the Canadian security.

If you educate, if you set up the rules of the game and if you have openness in terms of the processes that do not have to be kept secret for security reasons, then you can have a very depoliticized process.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you very much, Mr. Huebert.

Mr. Shimooka, like your colleagues, you are an expert on defence procurement. Concerning the future fighter capability program, do you feel that Canada's evaluation criteria were fair and equitable for all potential suppliers, that they have been so in the past and still are now?

I would like Mr. Shimooka to answer. Mr. Nossal and Mr. Huebert could then comment.

[Richard Shimooka]

It's good that you point out the word “fair”, because that's a really difficult part to parse.

The problem is that this can't be almost an equitable competition. As Mr. Nossal pointed out, the joint strike fighter program is much newer than many of the other options, except for the Gripen. It's significantly more capable. Basically, Canada's participation within the joint strike partnership industrial benefits program should have given it a very large leg-up on all the other options.

What you saw in 2010 was that when the initial evaluation was done by the Department of National Defence and the government, the understanding was that because it's much more capable and significantly less costly, and the industrial benefits were so much more skewed to the F-35, there was no competition required. It would waste taxpayers' dollars to undertake a competition at that time.

Now we fast-forward to 2015 and the current FFCP process. At that time, they had to change the evaluation criteria in order to give other options the ability to compete. There was no way for them to compete fairly in a lot of capability areas or in the industrial benefits aspects, or to at least let them have a plausible chance of winning.

When you say “fair”, it's a very difficult challenge to make a competition when one capability is significantly more capable, less costly and whatnot, so that others can have the chance to compete.

[Dr. Robert Huebert]

I'm going to jump in very quickly here. “Fair” has nothing to do with it when we're talking about the security of Canadians. The aerospace industry has fundamentally transformed itself since the 1970s, when, in fact, we could have different airframes competing.

We misuse the term “fairness”. You're really talking about competitiveness.

The reality is that we have a focus on construction. We need to have that long-term understanding. These are all the types of efforts that the Americans put into creation.

When you talk about protecting Canadians from the rising geopolitical threat that is coming from the Russians and the Chinese, and when we start talking about fairness and the time and money that it wastes, which diverts from what we should be focusing on, I have problems with that, to be perfectly honest.

[The Chair, Conservative, Robert Gordon Kitchen]

Thank you, Mr. Huebert.

We'll now go to Mr. Johns for six minutes.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Thank you.

I'm going to go right back to you, Mr. Huebert. You talked, too, about the geopolitical threats and how they have changed. This process started over a decade ago, so the needs and everything have shifted.

Can you talk about the flaws in our procurement process right now?

Also, in terms of level 3 partners, I think you identified Denmark as having a somewhat better process than we have. Can you speak about where there are good processes in procurement? Where can we look at those models? What can we do to update ours, so that we're not in as bad a situation as we are right now?

[Dr. Robert Huebert]

I'll start off with a point that Richard raised, and that is the reality that aerospace threats today are a system of threats. In other words, we have to get out of this mindset that somehow dogfights and individual capabilities of the airframe we're talking about is what is going to give us security as we engage with the enemies we will be engaging with in the future.

We need to have the ability to converse with all sensor capabilities. In other words, if the fighter can actually see the enemy that it is trying to take out, in today's warfare environment it's probably too late. You're probably already dead at that point in time, given what missile technology, surveillance and sensors are now doing.

In other words, it's all about having that domain awareness. That's the strength that the F-35 brings to the fight, and this is why people like the Finns are going for the F-35 rather than the traditional Griffins or the Swedes' materiel that they go to. You have to know that in terms of the ability to win in an aerospace fight, you need to be able to anticipate what your enemy is doing, and that means you also have to have missiles that can reach that range—we start talking about a system—and you need to be able to keep your aircraft airborne. One of the things we haven't talked about is the fact that modern-day air-fighting requires tankers to a degree that we always forget about; it's the unglamorous part of air power that we need for the procurement system.

Once again, when we look at the Danes and at the Finns, what they both started with in their processes was not so much “what's the airframe?”, because, to be frank, the Finns wanted to stay with the Swedes—they like that relationship—but that they recognized the growing aerospace threat the Russians are bringing with their hypersonics, with their fifth-generation fighter capabilities that they bring to the battle, so they in fact had to have a system that was based on the pure protection of Finland and Denmark.

You get that solved—that you are in fact responding to a threat—and that speeds the system and focuses the mind incredibly. We don't seem to see indications of the political interference once that decision is made. Now, of course, what we see is that there is even more urgency for them to acquire this capability.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Thank you.

Mr. Nossal, in a 2016 publication, you argued that due to Canada's geopolitical position and voters' poor appetite for defence spending, Canada should focus on specialized military capabilities instead of developing all possible capabilities. Can you talk about which specialized air capabilities Canada should focus on? Also, has your position changed on those specialized capabilities since that publication? If so, how?

[Prof. Kim Nossal]

On the first question about what kind of air capabilities, I have a very different view on this one than Professor Huebert. There's only one question for me, and that is, what are the Americans flying?

Because of the crucial importance of the air defence of North America, still, after all these years, for me there's only one question to be asked and answered, and that is, what are the Americans flying in the defence of North America and what, then, are we going to be flying? They won't let us fly F-22s, but they're going to be flying F-22s and F-35s, so we need to be flying F-35s as well. From that point of view, that's the reason why, in response to Madame Vignola's question, it really wasn't fair, but that's another issue.

On the question of going after niche, the one thing that hasn't changed since I wrote Charlie Foxtrot in 2016 is that Canadians have not grown any less cheap about defence expenditures. They may be willing to increase the defence budget in the shorter term, given what's happening in the world, but the essence is that Canadians are still extremely cheap, and therefore we need to tailor our military along the lines of what actually Canadians will agree to purchase.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Mr. Shimooka, you were talking about how there are different processes internationally. Can you point to a country that has a good procurement process Canada should look to?

[Richard Shimooka]

That's a complex question.

I think there are segments of procurement processes that we see internationally where we can see that it worked. The United Kingdom has had some successes. The Australians have as well. The United States is another country, and also France.

I would specifically look at some programs that have actually achieved their cost targets, capability targets and also industrial or technology development. An example I've raised before was the M-SHORAD program in the United States. There are also the examples that Mr. Huebert discussed of how Finland or even Switzerland have identified selecting the F-35. It really depends on what you're looking at.

One of the biggest challenges we're seeing right now is basically trying to get software-enabled capabilities, which is this next generation of capabilities that are really critical for situational awareness, and identifying and prosecuting targets. Those are big challenges.

The United States has made some really big steps in trying to get those capabilities faster and deliver them to their war fighters quicker and on cost. I'd probably look at those efforts there.

[The Chair, Conservative, Robert Gordon Kitchen]

Thank you.

We will now go to our second round of questions.

We will go to Mr. McCauley for four minutes.

[Kelly McCauley, Conservative, Edmonton West, AB]

Gentlemen, thanks very much.

I'm going to ask the same question of the three of you. I'll just ask if you can each take about a minute and a half to respond, starting with you, Mr. Huebert, and then Dr. Nossal and Mr. Shimooka.

There's the issue of “the buck stops here” responsibility with procurement. How do you see it best set up for Canada? We repeatedly see departments and ministers come before us and there's never a straight answer of who's responsible for a decision.

Our system is very clearly broken. How do you see us tackling that as a country?

[Dr. Robert Huebert]

It gets even worse because we've allowed almost no room for failure within the individual departments. In other words, look at the penalty of what happens if someone has been delayed. In terms of the individuality within, for example, DND, we'll see the accusations. You can talk to the individuals involved. It often freezes activity.

Then we get to the very top aspect and once again, because of the diffused nature and the way so much of what is happening is hidden from view, we can't see who the political leader is who said that we will delay on this decision, that we will go forward or that we will ultimately make it happen. There is an increasing inability to understand that and that means—

[Kelly McCauley, Conservative, Edmonton West, AB]

How do we tackle that, then?

I'll give you an example. A couple of weeks ago we had PSPC in. We were asking about the potential delay of another year for the F-35 decision. We asked who made this decision. The answer was that we, as a government, did.

Well, who was it? It's just passing the potential blame around.

[Dr. Robert Huebert]

We can take a little bit of a lesson from the Japanese. They're the one example we haven't talked about at this point. In terms of their major procurement, they have bipartisan acceptance. Part of it is because they have a shared view. It doesn't matter if it's the liberal democrats or the socialist party, there is the recognition of the growing Chinese threat. Their submarine program probably stands out as one of the very best of procurements that we could talk about. I know that's for the second hour.

It goes to the heart of what Dr. Nossal was saying about political gamesmanship. If we can create a norm within the Canadian government that this is not about Liberals, Conservatives, NDP or Bloc Québécois coming ahead or showing that they're getting their individual ridings, but it's in fact for the security of—

[Kelly McCauley, Conservative, Edmonton West, AB]

I'm going to interrupt you briefly to give Dr. Nossal a chance.

Mr. Shimooka, I'll get you on my next round.

Dr. Nossal, do you want to chime in?

[Prof. Kim Nossal]

Yes, thank you.

I think there's always a tendency to want to follow the Australians here because they tried an experiment with creating a separate department of defence procurement. They've abandoned that, and they've essentially put their defence procurement back under the authority of the Minister for Defence.

When we think about changes that we could make, my own view is that we need to get rid of this tripartite view of procurement, industry and national defence, and recognize that what we're talking about here is a national defence expenditure. That means that, ideally, the Minister of National Defence should have that authority.

That's what I would be inclined to do.

[Kelly McCauley, Conservative, Edmonton West, AB]

That's perfect. Thanks, gentlemen.

[The Chair, Conservative, Robert Gordon Kitchen]

We will go to Mr. Housefather for four minutes.