Evidence of meeting #24 for Foreign Affairs and International Development in the 39th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was industry.
A recording is available from Parliament.
Director, Centre for Defence and Security Studies, University of Manitoba
I understand the word “politics”, Mr. Rae. I understand it entirely, but there are two separate issues here. So it may go on as a basket, but you raise a lot of questions that are important, questions in which history is important to us.
We went through these agonizing decisions 40-plus years ago, when it came to issues surrounding Canada's capacity to maintain its own private- or public-owned defence industrial capacity. The decision made then, the famous Avro Arrow decision, and that was followed by others, was that Canada cannot afford to do it, as it does not have the market to sustain it; that Canadian industry can only sustain by access to foreign markets; and that the key access for Canada, as a function of geostrategic interests, simply location, common values, cultures, and the business community was the American market. With questions of access and maintaining access to the market, numerous agreements were reached between Washington and Ottawa that facilitated this close working relationship, which was highly integrated. That gave Canadian firms access to the American market with constraints, which gave American firms prime access to the Canadian market with constraints that we put on them. So it was never a free trade arrangement. It always was a managed trade arrangement, and that has been fairly successful.
Are there new issues that the relationship faces? Of course there are, and the central one is the issue of ITARs when it comes to this question. It seems to me that if we're going to look at the past and what that record is, relative to the current issues of where we're going in the future, we have to ask ourselves very simply whether the Government of Canada, Parliament, the people of Canada, are willing to invest the massive amount of capital for this one critical capability, sustain it, make it dependent on Canada, and probably undermine its ability to access foreign markets because of the dynamic of the international marketplace when it comes to these things. How much are we going to invest? How long are we going to invest before the government comes to the conclusion, which happened 40 years ago, that in fact this is not a wise investment of national capital?
I think we have to be concerned in terms of recognizing that the public-private partnership has been successful up to now, and the question in my mind becomes: why do we think this is suddenly going to change? That seems to be the critical issue that no one wants to answer.
So that's my perspective on it.
President, ImStrat Corporation
Radarsat-1, as far as I understand it, is owned by the Government of Canada. It's government property. So in the old days, the old days being Radarsat International, it was brought up, stood up, and provided the distribution rights to go and sell it on the market, and they were very successful at that--great time, not a problem. And then they were bought out by MacDonald Dettwiler in order to pursue that.
In terms of the future, yes, in terms of private-public partnerships and all that, I find it extremely debatable as to whether these are successful or not, especially within the geomatics industries, considering the number of companies that have gone under for many, many years either because of lack of funding or delayed funding for potential contract opportunities in research and development, and of course with the domination of one primary corporation within a Canadian industry, that being MDA, which saw a lot of focus. That has nothing to do with MDA. It just means that the focus was on the development of Radarsat-2 and its infrastructure.
In terms of the infrastructure to operate this, it's already there. It's been paid for. The Canadian Space Agency operates the Radarsat-2. It operates Radarsat-1. The Canadian armed forces have already invested heavily through Polar Epsilon in the installation of ground station segments and so forth on the east and west coasts as part of the operations in preparation for Radarsat-2.
In the future, it will be joint operations. There's no question. And when I talk about joint operations, I'm not talking about just within a military perspective. I'm talking about a joint operation in terms of having the lead organization be the Canadian Space Agency--that's what they do, that's their job--along with the Canadian military and Natural Resources Canada, specifically the Canada Centre for Remote Sensing. They have a key interest in this whole thing.
In terms of emergency preparedness, in terms of forestry, in terms of geological survey, this Radarsat-2--and not only the Radarsat-2 system, but all the intellectual property that has been developed in the applications--is right here in Canada, so working within that type of organization is tantamount. It's critical, and it has faltered in the last ten years because of the focus of trying to get this Radarsat-2 system up and operational.
Now here we are today. Where's the future? It's joint operations, no question about it. Does Canada take control and ownership of Radarsat-2? As far as I'm concerned, yes. It's got nothing to do with MDA. It has everything to do with national security and how we want to use that system.
Let's look at an example of private-public partnership from the German model, the business model, which I thoroughly enjoy, I'll be quite honest, because I deal directly with Infoterra over in Germany for TerraSAR-X. That's Germany's system. The satellite is owned and operated by DLR, which is a German government organization. The imagery distribution rights have been given to EADS Infoterra, so for worldwide distribution and sales it works out beautifully, because I get it and they get it. We go by the rules and regulations, the laws of Germany. It's not a problem. It works out great.
So in terms of business models, there's not an either this or this. There are various types of business models that could be looked at.
Conservative
Bloc
Diane Bourgeois Bloc Terrebonne—Blainville, QC
Thank you, Mr. Chairman.
Unlike my colleague, to my mind, to understand the future, you have to look to the past. In 2005, this committee examined Bill C-25 which dealt with Radarsat-2. The Bloc Québécois was very visionary at the time, in that it was the only party—indeed it had the support of the NDP—to argue that Bill C-25 did not provide any guarantees that the Radarsat system would not be bought up by another company. At the time, the Liberals and the Conservatives were opposed to beefing up the act to protect Radarsat.
That being said, I would like to come back to something Mr. Last said, namely that not everything is for sale and that national security must remain a consideration. Mr. Last, Mr. Chairman, I would also say that values are very important in this instance, since MDA handles the archival side of things. We are talking about data that is important to Canada. If MDA is sold, who knows what will become of this archived data.
Am I correct in my assessment of the situation?
President, ImStrat Corporation
Yes, that is correct, as a matter of fact.
The archiving of the Radarsat-1, at present, from what I understand through the Canada Centre for Remote Sensing, is being conducted by MDA. What happens to this archive? It's a very good question. You're going to have to ask MDA, or more specifically, I would encourage you to ask CCRS.
Bloc
Diane Bourgeois Bloc Terrebonne—Blainville, QC
Thank you.
Mr. Fergusson, it is a known fact that the majority of Quebeckers are opposed to the militarization of space. I am told that ATK manufactures fragmentation bombs and anti-personnel landmines. Earlier, you talked about decades of Canadian policy. Yet, in recent decades, people have tended to oppose war and to favour negotiation over war.
Canada is a signatory to the Ottawa Convention which calls for the removal of anti-personnel land mines If Radarsat is bought by ATK, a company that manufacturers fragmentation bombs and anti-personnel landmines, do we run the risk of being associated with the United States, a country that has not signed the Ottawa Convention?
Director, Centre for Defence and Security Studies, University of Manitoba
ATK, like most major corporations, has numerous divisions that generally run independent of one another. I don't know the exact organizational structure of ATK, per se. If we took that perspective on this issue, I would suggest there are numerous companies in this country that are American-owned and numerous companies in this country that are Canadian and access the American market that are engaged, one way or another, in defensive sales and development of technologies. In my view, it doesn't make any difference at all to the issue of the question of Radarsat, of the question of this technology in production being sold to ATK. It wouldn't matter if it was ATK, as far as this issue has been constructed. It's only a matter that it's U.S. ownership. That's the issue at play here.
I would remind you that our forces in Afghanistan work very closely with American forces in Afghanistan, and American forces in the United States never signed a landmine ban at all. I don't see why this is an issue. If we're going to make a case that Radarsat-2 and the technology, the intellectual property, etc., of the space system division should be in Canada on national security grounds, which means on grounds of defending the nation from threats to its national security, then that requires the potential threat and deployment of force. So you can't say that on national security grounds we're going to keep this in order not to use it for national security grounds.
Bloc
Diane Bourgeois Bloc Terrebonne—Blainville, QC
Mr. Fergusson, if ATK, a company that manufactures anti-personnel landmines, was to buy Radarsat, what image of Canada would that convey to the rest of the world? Do you want Canada to project a strictly military image? Can we not have values as well? If I understand correctly, you are defending the sale of Radarsat to ATK.
Director, Centre for Defence and Security Studies, University of Manitoba
It has no impact whatsoever on the way Canada looks on the international stage, period. It has no impact in terms of the landmine question working with American soldiers overseas. It's irrelevant.
Bloc
Diane Bourgeois Bloc Terrebonne—Blainville, QC
Let me remind you that Quebec is still part of Canada. Quebec, like many Canadians, is opposed to weaponization and anti-personnel landmines. Perhaps this is something to think about.
Thank you, Mr. Chairman.
Director, Centre for Defence and Security Studies, University of Manitoba
Radarsat has to do with remote sensing. It has nothing to do with weaponization of space. It looks downward. It's not a weaponization issue.
Conservative
President, ImStrat Corporation
In terms of the perception of the selling of Radarsat, if we're going to use that as a test to determine, then we're going to have to go back and look at every single Canadian company that was ever sold to a U.S. company. That's the bottom line. As far as I understand, many U.S. companies have a direct or an indirect relationship with defence, with targeting, with attacking, and with bombing. I'm also talking about remote sensing companies too, in terms of DigitalGlobe down in the United States.
Can Radarsat-2 be used for targeting? No. It doesn't have that capability. But in terms of the perception and the values that Quebeckers want to project, then we're going to have to look at all the Quebec companies that make ammunition in Montreal and that provide it to other countries and also to the Canadian Forces. These are all the different things we have to take into consideration.
Conservative
The Chair Conservative Kevin Sorenson
Thank you, Mr. Last.
We'll move to the government side. Mr. Khan.
Conservative
Wajid Khan Conservative Mississauga—Streetsville, ON
Thank you, Mr. Chair.
I'll be sharing my time with my colleague, Mr. Lebel.
We on this side of the House feel there is a bright and growing future for CSA with the ongoing and upcoming programs--the announcement of the astronaut recruiting program, the James Webb Space Telescope, the International Space Station, and the Radarsat Constellation program.
This Conservative government recognizes the strategic importance of having a long-term S and T policy, which is why the government addressed the issue in budget 2008 of transforming ideas into concrete, innovative products.
What I would like to ask anyone.... Perhaps Mr. Last would like to comment on this. Professor Michael Byers of UBC states, and I quote:
Shockingly, Canadians began to lose control over Radarsat-2 before it was even built.
Do you agree with that statement? Is it true today? And do you think it was wrong for the former government--and I have to say Liberal, unfortunately, as they were there at that time, and it's not being political--to have allowed a private company to own and operate a piece of hardware like Radarsat?
Conservative
The Chair Conservative Kevin Sorenson
Mr. Last, it looks like you're geared up and ready for that question.
President, ImStrat Corporation
Yes, and I'll go back a good number of years to when it was first announced that MDA was awarded the contract and the impact it had upon the geomatics industry. Some of them were growing and some of them were very prosperous, both through contracts with the Government of Canada and internationally, and then there was the announcement that all ownership and copyright laws were to be passed over to one particular company. This impacted significantly in terms of further research and development in which other companies wanted to participate with the use of Radarsat-2, because so much work was done with Radarsat-1 and 2. And I'm talking applications here--whether agriculture, forestry applications out in western Canada, in Quebec, and so forth, and also for national security.
All of a sudden we were told by the Government of Canada of the day that in order for us to obtain any funding, in order for us to obtain any support for application development, we had to cooperate with the biggest kid on the block, MDA. This impacted significantly. There's absolutely no question.
Many companies--and I'm sure some of them are still here, but some of them have gone bankrupt due to a lack of opportunity and a lack of support--were completely outraged at that stage and at that time when it was announced by the Government of Canada. It just so happened to be MDA that was awarded it. It had nothing to do with MDA. It was just the decision of having this private-public partnership where a majority of the taxpayers' money was to be invested in this, with a small percentage provided by that company, and then to turn around and tell us, “Oh, and by the way, if you want this, then you'll have to go to your competitor to get that imagery to compete against them”.
So from an industry perspective, yes, it's pretty outrageous. From a national defence perspective or a military perspective, yes, to me it's pretty outrageous. And I find it extremely insulting that I have to go to a private company. As a first-rate developed nation not having their own assets...only Canada.
Director, Centre for Defence and Security Studies, University of Manitoba
Well, I'll take a different tack from Mr. Last to the question you raised.
I'm not sure, as I wasn't here when Mr. Byers made those comments, but I infer that he's raising the question of the access issue and the question of the launch of Radarsat-2 and the dispute that emerged over the question of launch after NASA refused initially to launch Radarsat-2, as they had launched Radarsat-1.
The debate then emerged about whether Canada should seek an alternative launch from either China or Russia, and of course all the political issues emerged, which then brought into play the reality of the integration of Canadian and U.S. industries and technologies. The fact of the presence of U.S. technology on Radarsat-2 gave the United States, of course, leverage on the issue of launch because it had to meet U.S. ITAR technology demands, which then gave us remote sensing legislation.
The answer to the question, of course, is that when one talks about a national space capability, one also is talking about the most important thing that everyone forgets. Radarsat-2 technology is wonderful, but if you can't put it up there, if you have no independent access, and Canada does not have an access capacity, then you rely upon others. Over the decades there has been a very profitable and mutually beneficial relationship with the United States, which now for security reasons on the American part has become a little difficult.
Canada, for a lot of strategic political reasons and economic reasons, cannot simply ignore that reality, and I think this is probably what the reference is. I don't think in that sense we've lost control of Radarsat. I don't think we've lost control of this technology per se. It's the reality of the beast, if you will, that no matter what the government's going to do, it can't really escape from and it has to always be sensitive to these types of questions and issues.
Conservative
Conservative
Denis Lebel Conservative Roberval—Lac-Saint-Jean, QC
First of all, thank you for joining us. I listened to my colleague from the Bloc Québécois talk about what transpired in 2005. We need to ask ourselves what the consequences of this transaction could be.
I am pleased that today, our minister has decided to protect our country when it comes to very important intelligence and security matters. Mention has also been made of important values such as defending our country, democracy and health. Our country continues to defend these values on both the national and international stages.
This issue of Arctic sovereignty worries me a great deal. Mr. Fergusson talked about Canada's inability to adequately defend our sovereignty over the Arctic. One of the areas he mentioned was submarines. I would like to hear Mr. Last's views on defending the Arctic. What capabilities do the Americans have? The motion reaffirms our will to maintain control over the Arctic and to continue working with this aim in mind. I fail to see the purpose of the motion, since it merely reaffirms the same thing.
Having said that, now that we have shown our true colours on the question of defending Canadian technology, can the Americans influence in some way how these services are used?
