Good afternoon. Thank you for the invitation. My name is Mary Gregory, and I am the associate assistant deputy minister in the industry sector at Innovation, Science and Economic Development Canada.
Under Canada’s defence procurement strategy, our department is responsible for leveraging certain defence procurements to promote economic activity and growth across Canada. The purpose is to ensure that certain large-scale military purchases contribute more broadly to the Canadian economy.
We achieve this mainly through the application of the industrial and technological benefits policy, or ITB policy, since 2014; and where applicable its predecessor, the industrial and regional benefits policy, since the mid‑1980s.
The industrial and technological benefits policy applies on certain defence and Coast Guard projects over $100 million in purchase value that are not subject to trade agreements, or when a national security exemption is applied. The policy requires companies awarded contracts to undertake business activities in Canada equal to the value of the contracts they win.
Business activities can be directly related to the procurement or can include other high-value activities in areas that strengthen Canada's industrial base in defence or other sectors and advance key priorities. A value proposition is generally developed for competitive procurement through market analysis and informed by industry engagement that is conducted in parallel with the work of other departments to support procurement timelines. It can also be developed and applied to directed procurement.
The economic benefit requirements also target business activities in Canada’s key industrial capabilities, which include areas of established strength, such as training and simulation and emerging technologies such as artificial intelligence.
As a core department under Canada's defence procurement strategy, ISED participates in interdepartmental governance, and works closely with our partner departments in the procurement process. This enables our officials to develop economic benefit approaches early on in the procurement process and work in parallel with the work of our partner departments to support timely decision-making and meet procurement deadlines.
With respect to the industrial and technological benefits policy, Canada has developed a robust and flexible tool that achieves positive economic outcomes in an open and transparent manner consistent with the overall procurement process. Canada's regional development agencies can also play an important role in the process and work closely with businesses to streamline the identification of potential suppliers. Contractors are also given a proportionate amount of time in which to complete their obligations, usually tied to the duration of the contract.
Since Canada has leveraged defence procurements for economic benefits for over three decades, most large contractors are well aware of the ITB policy and its associated obligations.
This policy remains an important tool to foster economic growth, support innovation, contribute to exports and help maintain and build Canada's industrial base.
Thank you very much.