Thanks, Mr. Chair. It's a pleasure to be here to talk to you about these matters.
I'd like to begin by making a comment about the tragedy currently unfolding in Ukraine. We have a moral obligation to step forward and do our part in addressing the violence taking place now. In all likelihood, going forward we'll find ourselves in a similar position elsewhere in the world. To do our part, though, we can't continue to squander precious time and resources through abhorrent procurement practices, which are on full display in our attempts to acquire new fighter jets and new ships.
I'd like to talk for a moment or two about how to fix defence procurement, and then give some comments on the recent decision to acquire the F-35s.
For over a decade, I've been a fervent advocate of the need to establish one point of accountability. Christian mentioned this in his comments. Quite simply, there is excessive overlap and duplication between the roles of the Minister of National Defence and the Minister of Public Services and Procurement in Canada. Unless and until one minister is placed in charge of defence procurement, it will never be as efficient or as effective as it could be.
Among our close allies, Canada stands alone with this system of dispersed accountability. The United States Secretary of Defence is accountable for military procurement. In the United Kingdom, the responsibility falls to the Secretary of State for Defence. In Australia, defence procurement is under the authority of the defence materiel organization, which is accountable to the Minister for Defence.
In December 2019, I was encouraged that the government was finally going to act on this recommendation. The mandate letters at the time for the Minister of National Defence and the Minister of Public Services and Procurement included a directive to bring forward options for the creation of a new, single entity, “defence procurement Canada”. Sadly, my hopes were dashed when the December 2021 mandate letters to these two ministers no longer referenced this matter.
I recognize that addressing this governance issue will not solve all the procurement problems, but it is a necessary first step. The benefits of creating a single procurement organization go beyond strengthening accountability. First, the process would also be streamlined. At the present time, the process only moves as fast as the slower of the two organizations permits. The result is that many months can be lost due to briefings and approvals through multiple organizations.
Second, savings will emerge from the elimination of overhead and duplication of functions through the merging of PSPC and DND resources. These savings can help mitigate the impact of the significant staff cutbacks over the past two decades.
Third, until one minister is vested with overall accountability for defence procurement, it will be difficult, if not impossible, to introduce system-wide performance measures.
With respect to performance measures, famed management guru Peter Drucker once said, “Any government, whether that of a company or of a nation, degenerates into mediocrity and malperformance if it is not clearly accountable for results”. Without performance measures open to public scrutiny, performance suffers. We need indicators that, at a minimum, measure cost and timeliness. If costs are rising, why are they rising? If delays are occurring, where in the process are the bottlenecks? It is impossible to make improvements if we don't have a clear understanding as to where the problems lie.
Finally, we need a capital plan with the following attributes. First, it must be a fully costed, long-term plan. The Department of National Defence's defence investment plan is a weak and inadequate attempt to meet this need. It lacks sufficient granularity to be effective. The costing debacle of the CSC proves this point. Unlike the defence investment plan, the full life-cycle costs for each project should be displayed over a 30-year period and mapped against the projected available funds year by year.
Second, it requires cabinet approval. Cabinet approval makes it more difficult for governments to change priorities for partisan political purposes.
Third, it needs to be made public. The benefits of such a public plan would be far-reaching. From a public information standpoint, all Canadians would have a better understanding of what...and how the money is being spent. Parliamentary committees like yours could more readily provide rigorous oversight over these billions of dollars of expenditures.
Lastly, knowing that this plan is less likely to be modified, potential suppliers will more readily take the necessary time to position themselves in an optimum position to compete at the appropriate time.
With regard to the recent announcement, I do have a couple of concerns—