National Defence Committee on Sept. 15th, 2010

[Peter MacKay, Conservative, Central Nova, NS]

This aircraft has continued capability that expands upon what an CF-18 can do. It's obviously a fifth-generation aircraft, so we're now four generations past the CF-18, with new on-board sensors, with stealth capability--which is a fifth-generation unique capability--and with the interoperability with other NATO and NORAD countries. All of this tells me, based on expert advice from people like General Deschamps, that this is exactly the type of aircraft that we need not just for today, Mr. Simms, but looking out into the future, whatever those airborne and maritime threats might be.

Perhaps General Deschamps would want to expand on the capability of the aircraft and the airspeed.

[The Vice-Chair, Liberal, Bryon Wilfert]

Since General Deschamps will have an opportunity in the next round, I'll let Mr. Simms ask his questions, and I'm sure he'll come back to the general.

Mr. Simms.

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

My perception of the process that started in 1997 is that we were involved on an information basis only. It seems to me that we never got fully engaged in this process until Lockheed Martin was chosen. So originally I was concerned that the Americans were leading our decision-making here when it comes to our new aircraft, but now you bring in the idea of copyright.

If we're talking about copyright as well, who exactly is writing our requirements? Is it the Americans? Lockheed Martin? Are they writing our requirements as well?

[Peter MacKay, Conservative, Central Nova, NS]

You might want to ask members of your own party that question.

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

Before I finish, could you please add the comment about when exactly we are going to get fixed-wing search and rescue?

[Peter MacKay, Conservative, Central Nova, NS]

Mr. Simms, let me correct an inaccuracy here. To suggest that we were in only in theory under the previous government, your government, is absolute hogwash. We were in for $168 million under the previous administration, which potentially we would forfeit, along with the benefits to the Canadian aerospace industry. So that's not true.

With respect to what we will be able to do in the future for Canadian aerospace, that's been outlined in some detail.

On fixed-wing search and rescue, it's not a matter of doing one or the other. Buying fighter aircraft is not exclusive of buying fixed-wing search and rescue. We are proceeding with a very rigorous process that we hope will conclude and allow for us to proceed this year. That again is something that was neglected by your government. So it's another issue that we inherited and now we've acted upon, and we're prepared to procure new fixed-wing search and rescue in the very near future.

[The Vice-Chair, Liberal, Bryon Wilfert]

Mr. Simms, you have ten seconds.

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

So this year we expect something concrete from fixed-wing search and rescue? Because at this point, despite the three departments, you've even called in the National Research Council, so--

[The Vice-Chair, Liberal, Bryon Wilfert]

Minister, yes or no.

[Peter MacKay, Conservative, Central Nova, NS]

We have sought outside independent advice from the National Research Council. That will help us buy the new fixed-wing system—

[The Vice-Chair, Liberal, Bryon Wilfert]

Thank you.

I know you wanted to slip that in there, Mr. Simms. Thank you.

Mr. Calkins, you have five minutes.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

Thank you, Mr. Chair.

I thought it was going to go to my colleague Mr. Wallace, but that's fine.

I certainly want to thank my colleagues for appearing today. It's a pleasure for me to be back on the defence committee, even if it's just for a day. I certainly enjoyed my time on this committee, for the first year of my term as a member of Parliament. It's good to see Mr. Bouchard back here as well. We spent some time together going around and talking to various people in regard to our military.

Minister MacKay, I guess my question would be to you, through the chair.

The absurdity of the Liberal position has been put out to us. The flip-flop on this particular policy is absurd to me, but I guess we shouldn't be surprised. We've seen it before. My understanding of the CF-18 fleet is that each of those aircraft has an operational time limit of about 5,000 hours on each air frame. We're approaching the end of life, I think, for those aircraft. We started off with nearly 140. I think we're down to 80 or so that are now functional and operational.

The members of the opposition are calling for cancellation of a program that they've started. Canada is now heavily invested. The options, I think, have been laid out quite clearly to us. We can jump out of the program, and then make a decision to buy back into the program, or just buy the Lightning F-35 at the higher rate than we can, actually, because we're part of the program now.

The other option, I guess, if they were to opt out, would be to go look for a fourth-generation fighter, which clearly doesn't meet the operational requirements. Or heaven forbid that a future government might even say that we don't even need fighter aircraft anymore.

I guess my perspective, to you and to all of my ministerial colleagues here, is that when it comes down to looking at it, those are the four options. Going back to a fourth generation...I don't think we can increase the operational lifespan of the CF-18. I think the current fleet of CF-18s is done. Even if we reduce our operational demands and flying time, we're looking at, what, 2020 at most?

Can you clarify which of those four options seems to make the best sense? Those are the only four options, as I see it.

[Peter MacKay, Conservative, Central Nova, NS]

Mr. Chair, purchasing new aircraft obviously makes the most sense. I thank my colleague for the question.

In fact the Prime Minister was recently in Montreal to announce a further investment in upgrade in the existing fleet of 78 CF-18 fighter planes. So that new investment will allow us to project out to at least the year 2020. We're scheduled now to start receiving the F-35 around the year 2016 or 2017. There won't be an operational gap. That will allow for the training to take place, for the additional transition to occur at air bases like Bagotville and Cold Lake.

As you said, we've seen this movie before when it comes to the cancellation or the delay of contracts. We've seen that film. It's a nightmare. It's called the cancellation of the Sea King replacement. We're now flying 45-year-old Sea Kings as a result of that decision. That political partisan intervention, with a strike of the pen, saw that contract burned at a cost of $1 billion to taxpayers, and at a significant cost, I would say, to the air force in terms of our ability to continue to patrol over the Atlantic and the Pacific and to have those aircraft available to us for international missions, the counter-piracy type of missions, etc., in places like the coast of Africa, off Somalia.

It's important not to have operational gaps. These investments are forward looking. These investments allow us to ensure that we will have this fifth-generation aircraft, as you've mentioned, which is unique, which doesn't mean going back and buying older aircraft that will not have the parts and the spares and the supply chain that we will benefit from with a new fifth-generation aircraft.

This is the right plane. It's the best plane on the planet for the best pilots and the best Canadian air force that we can put forward to protect our country, to participate in international missions, and to do what Canadians expect of them in promoting and protecting our sovereignty.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

Just to follow up, then, I believe 138 CF-18s were originally purchased. If that was the right number then, and we're down to 80 operational now, how do we know that 65 is the right number for today?

[Peter MacKay, Conservative, Central Nova, NS]

That's a very good question. Because of the new technology--the stealth, the interoperability that we will have with our NORAD colleagues—we will be the beneficiaries of this larger package of F-35s that will be operating over North American skies, patrolling our coast lines, because of NORAD. The optimum number of aircraft arrived at by experts like General Deschamps is 65. He'll be able to speak to that further in terms of the technical capability.

So because of all of the advancements that have been made in a fifth-generation aircraft, they can do what 78 aircraft are currently doing. Sixty-five will have that same ability--and perhaps more because of stealth, because of technology, because of interoperability.

[The Vice-Chair, Liberal, Bryon Wilfert]

Thank you, Minister.

The second round will be concluded by Mr. Wallace.

Mr. Wallace, you have five minutes.

[Mike Wallace, Conservative, Burlington, ON]

Thank you, Mr. Chair.

Thank you, Ministers, for being here today.

It's actually an honour for me to be here today. I'm very proud of the fact of our government moving forward on the F-35s. As a matter of fact, today another minister, Minister Van Loan, is touring a plant in the city of Burlington: Goodrich Aerospace Canada. About 130 people work there. They're in the business of service and maintenance of landing gear. They're getting an opportunity to compete and to have a contract to work on this F-35 program that we have.

When I'm back in my riding and talking to people where these jobs are being created and maintained, are there....? Are you telling me today that they'll not only be able to work on services and parts for the Canadian fleet of F-35s, but because of the MOU and the relationship we have with our partners, those jobs may exist for maintenance and work on the F-35s of other countries?

What's the timeframe? Is this an opportunity for them for 40 years? What is the advantage to Burlington in the long run, based on what's happening?

[The Vice-Chair, Liberal, Bryon Wilfert]

Minister Clement.

[Tony Clement, Conservative, Parry Sound—Muskoka, ON]

I'll start off on that and indicate that you're quite right; a lot of these contracts are based on a 40-year lifespan of procurement. Certainly the industrial agreements that Industry Canada has pursued with Lockheed, Pratt & Whitney, and GE Rolls-Royce basically are the keys that unlock the access to the global supply chain. If you talk to Goodrich in your riding, if you go to Bristol-Magellan in Winnipeg, if you go to Pratt & Whitney in Montreal, they'll all be saying the same thing. I gather they'll be here deposing before this committee as well.

That's the key for future jobs. It's not just building for the Canadian supply; it's getting access to the global supply chain. That's what this industry wants. That's what they've told me they want in future IRB agreements that are made, and they certainly would opt for that with respect to the F-35s.

So yes, you're looking at a stream of work, over multiple decades, that allows the companies to do the hires, to hire the skilled labour. We have 83,000 people who work in the Canadian aerospace industry. We are world leaders in many different aspects of aerospace. I want those 83,000 people to be not only guaranteed for those jobs, but we want to expand those jobs, obviously, to renew jobs in our communities. That's the kind of work we're contemplating by making the decision we made here.

[Mike Wallace, Conservative, Burlington, ON]

Thank you, Mr. Chair.

Minister MacKay, I'm assuming that when the program started back in 1997 we weren't the ones who recognized that the current CF-18s would only last until 2015 or 2020. I'm assuming it was recognized by the previous Liberal government that this was a long-term vision: it was going to take time to come up with the plan, get the engineering done, and decide where we were going to go.

Last night on CBC, the Liberal leader was asked directly whether he would cancel the contract. He hemmed and hawed and he gave a non-direct answer. I think he was asked a couple of times.

What does it do to the defence department when they are not sure of what is going to happen tomorrow? When the Liberal leader is not able to say yes or no, and hems and haws and leads Canadians on, what does that do to our men and women in uniform?

[Peter MacKay, Conservative, Central Nova, NS]

I think it's fair to say that it has an impact on their morale. It also affects, in some cases, decisions for their families in terms of where they may be based in the future, and their future career plans. It also has an impact internationally with respect to confidence from our important allies, NORAD and NATO.

I want to come back to the question of the number of aircraft, the 65. Under the current MOU, which, to their credit, the previous Liberal government signed and we've continued, this will allow for the potential for other purchases at a preferred price. It will allow us maximum flexibility in terms of meeting the security environment that may exist in the future.

Certainty is important, and avoiding an operational gap, I stress again, is the most important thing from the air force's perspective. They want to be able to do the job and do it efficiently and effectively with an aircraft that they have confidence in.

We ask a lot of these pilots, and for them to go out over the Atlantic, fly at those altitudes, and meet those challenges, they need an aircraft of fifth-generation capability.

[The Vice-Chair, Liberal, Bryon Wilfert]

Thank you, Minister.

I'm now going to go to the lightning round. The lightning round will be two and a half minutes--questions and answers--in order to accommodate all four questioners.

Mr. Simms.

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

I would like to return to the MOU. I reiterate this because it's of concern to me.

I appreciate the process by which that was started in 1997, but in terms of the future, to be masters of our own domain, to decide what is best for Canadian personnel, I certainly feel that what concerns me about this is that we have given away many elements of our own decision-making to a much greater cause.

I appreciate the fact that Burlington has some good work going on. I appreciate the fact that our people who work in this industry can do incredibly good work and compete internationally. But I also feel that Canadians also demand a dollar-for-dollar IRB in many respects, and I'm concerned that we have pushed this policy aside for reasons of stealth--for want of a better term.

Again, 3.2.1 of the MOU of 2006 states:

Actual procurement of JSF Air Vehicles by the Participants will be subject to the Participants’ national laws and regulations and the outcome of the Participants’ national procurement decision-making processes

I am concerned that we're forgoing that. In the beginning we said that we would have an open, transparent process, but we keep going back to a decision that was made in 2001. And it was one that was more of a done deal than anything else. That kind of freezes us out.

[Tony Clement, Conservative, Parry Sound—Muskoka, ON]

Let me try to add some light to the situation.

When we signed that MOU in 2006, it was Industry Canada. The purpose of that MOU was not to say, when we signed it with Lockheed Martin, that we sign this MOU and then we're going to open up the contract so that we can give the work to Boeing. Nobody would sign a contract like that. The MOU says we're going to work with Lockheed Martin, it's going to be pursuant to our procurement processes and pursuant to the context in which we signed the contract, and the context in which we signed the contract was that a previous government decided--quite rightly--that Lockheed Martin was the way to go. And that's what that MOU says.

[The Vice-Chair, Liberal, Bryon Wilfert]

Thank you very much.

We're now at the end of that one.

Mr. Bachand, you have the floor for 2 minutes and 30 seconds.