Public Accounts committee  Can I finish my answer?

Public Accounts committee  A guideline is designed to give guidance.

Public Accounts committee  Those discussions have not started yet. In the past, for previous submissions, we definitely used the life cycle.

Public Accounts committee  Treasury Board has a number of policies and directives and guidelines. They cover a wide range of activities and initiatives.

Public Accounts committee  Thank you, Mr. Chair. For the purposes of presenting a procurement project to Treasury Board, we use a 20-year cycle to predict costs, especially for maintenance contracts. As I pointed out, it is difficult to calculate maintenance costs for more than 20 years. So the life cycle of an asset can be calculated for a longer term for planning purposes, but for procurement purposes…

Public Accounts committee  Full life cycle costs are used at different stages of planning.

Public Accounts committee  Mr. Chair, I was asked what Treasury Board uses in making decisions. For acquisition projects, in making decisions, we use the duration. For planning purposes, if a department has to…

Public Accounts committee  Mr. Chair, we are neither at the acquisition stage nor the project stage. So we have not yet received a submission for this acquisition.

Public Accounts committee  The F-35s are not yet at the acquisition stage.

Public Accounts committee  Thank you, Mr. Chair. The Treasury Board guidelines are applied in different circumstances. When you are providing information for approval for a project, the life cycle refers to the life cycle cost of the materiel or the asset to be acquired. In the context of an aircraft or air weapons system or the air materiel that the Department of National Defence has procured even in the very recent years, the Treasury Board submission has always looked at a 20-year life cycle costing, especially with regard to maintenance, because beyond a 20-year timeframe, as I indicated in my previous testimony, it becomes very difficult.

Public Accounts committee  Mr. Chair, the Department of National Defence is subject to the policies, as any other department or agency.

Public Accounts committee  Mr. Chair, when we have received submissions from the Department of National Defence concerning the timeframe for the costing of a life cycle, 20 years has been deemed to be an appropriate timeframe. It is set by the Department of National Defence. Going beyond 20 years is considered too high-risk to ensure that the value in contracting with industry would be sustained, or the costs would be going beyond the 20-year mark.

Public Accounts committee  Mr. Chair, just to be clear, as I indicated in my remarks, the project for the F-35 has not come to the Treasury Board for consideration for its acquisition. So we are not in an acquisition stage at this particular juncture, and therefore we have not been analyzing or considering the cost of the acquisition at this particular juncture.

Public Accounts committee  There are two specific functions that are attributed in the action plan. The first is that we will commission, as I indicated, an independent review of DND's acquisition and sustainment project assumptions and potential costs. Then, prior to the proposal coming to the Treasury Board, the cabinet committee, for consideration, we will review and apply the full due diligence for compliance to Treasury Board policies.

Public Accounts committee  Mr. Chair, members of the committee, good morning. I am Michelle d'Auray, the Secretary of the Treasury Board. The Treasury Board and its secretariat set policies to guide departments in a wide range of management and resourcing activities, including the acquisition of assets. The Treasury Board is also the committee of cabinet which provides ministers with expenditure and contracting authority, when an acquisition process reaches that stage.