Industry and Technology Committee on Oct. 1st, 2025

[Wendy Hadwen]

There are a lot of accountabilities for each minister who is running a department with a role to play in this space. Because of the urgency of the threat, and our having resources now in National Defence, we are working extra hard with our colleagues in other government departments to make sure we all row in the same direction and, I would say, in the same boat. There is no room for silos at this time; it's not peace time.

[Michael Guglielmin, Conservative, Vaughan—Woodbridge, ON]

Is your recommendation, then, to just open up the information sharing among different areas of the department?

[Wendy Hadwen]

Yes, and other government departments, so we have an opportunity to get really good at working together in the service of the defence of Canada.

[Michael Guglielmin, Conservative, Vaughan—Woodbridge, ON]

You also spoke candidly about trust being hard won and lost, and how procurement suffers from a reduction in risk appetite due to past scandals and public complaints. Can you elaborate on what specific structural or cultural changes within the Department of National Defence are needed to rebuild that trust and improve risk tolerance?

[Wendy Hadwen]

I am not in a position to comment on the way procurement is managed or structured, nor where the trust comes from. I think we are all committed to trying to get the right capabilities into the hands of the Canadian Armed Forces and all those involved in the defence of Canada so that we can meet the moment.

[Michael Guglielmin, Conservative, Vaughan—Woodbridge, ON]

What concrete steps is the department taking, or should the department be taking, to foster a more open, collaborative relationship with the industry?

[Wendy Hadwen]

As part of our work on the defence industrial strategy, we've come to understand very clearly the appetite in the industry to understand what we are doing and what we intend to do next, so that it can help meet us there and help us solve problems.

As part of our advice to government, we will be thinking about how we can create spaces. There are already quite a few tables where we sit with industry, but there may be an opportunity for more or to change how those work.

May I give Kendal a chance to speak on this?

[The Chair, Liberal, Ben Carr]

We are running put of time.

Ms. Hembroff, if you could be quick, that would be great.

[Kendal Hembroff]

Chair, I don't think I have anything to add on this.

[The Chair, Liberal, Ben Carr]

That's as quick as you can get. I appreciate the accommodation.

Colleagues, that brings us to the end of the first hour of our meeting.

Again, to our witnesses, thank you very much for being available here today.

Major-General, again, I just want to say to you directly, to your staff and particularly to those members of the armed forces who are here in uniform today, thank you very much for your service to our country. The sacrifices you and your families make to keep us safe, in the present and in the future, mean everything to our country. Thank you very much for your attendance here today.

Colleagues, we're going to suspend briefly. We will return once we're set up for the second half of the meeting.

[The Chair, Liberal, Ben Carr]

Colleagues, we are going to continue with the second part of our meeting today. We have three new witnesses joining us for this hour.

I'd like to welcome, appearing as an individual, Professor Ashwin Iyer, who is the director at the Centre for Applied Research in Defence and Dual-use Technologies at the University of Alberta; Madeleine Redfern, chief operating officer and northern director of CanArctic Inuit Networks Incorporated; and Heather Exner-Pirot, director of energy, natural resources and environment at the Macdonald-Laurier Institute.

Witnesses, you will each have upwards of five minutes. I'm typically not strict, but we ran a bit over time in our introductory remarks in the last session, so if you could time yourselves, or just rely on me to give you a bit of a wave at the five-minute mark, I'd appreciate it.

I'm going to start with you, Professor Iyer. The floor is yours.

[Ashwin K. Iyer, Professor, Director, Centre for Applied Research in Defence and Dual-use Technologies, University of Alberta, As an Individual]

Thank you very much, Mr. Chair, and members of the committee, for the invitation to speak today.

As Canada takes historic steps towards a more self-reliant defence industrial strategy, our post-secondary institutions must be considered strategic assets. They provide advanced infrastructure, educate the next generation of innovators, and connect forward-looking research to the practical challenges facing national security and sovereignty across critical defence and dual-use technology sectors, from manufacturing and advanced materials to sensing and navigation, to artificial intelligence and quantum computing.

Universities are trusted public institutions with deep regional roots. They have the capacity to bring together researchers, industry and military end-users in secure, mission-focused environments. They can rebuild and grow sovereign industrial capabilities. They can provide the mechanisms to capitalize on procurement opportunities for Canadian businesses in global defence supply chains.

Western Canada, in particular, stands to be a new bastion for national security, serving as an economic and strategic nexus with vital assets in energy, logistics, advanced manufacturing and innovation. Its geographic proximity to the Arctic, combined with a vast resource base and deep regional expertise, establishes its pre-eminence in supporting defence needs in emerging domains such as remote surveillance, uncrewed systems and cold weather operations. Anchored by advanced infrastructure and resilient supply chains in adjacent sectors, such as energy, western Canada is poised to play a central role in the nation's defence industrial strategy.

Alberta features the largest concentration of defence assets in western Canada. Canadian Forces Base Edmonton is home to one-third of the Canadian army's fighting power. 4 Wing Cold Lake serves as the country's premier fighter training facility, while Canadian Forces Base Suffield contains the world's largest land-based military training area.

The Edmonton international airport will be the western main operating base for the Royal Canadian Air Force's CC-330 Husky fleet and will provide the long-term maintenance of Canada's Leopard 2 main battle tanks. Edmonton's rich defence presence is complemented by Calgary's strong and growing aviation and aerospace ecosystem.

These activities are emboldened by a constellation of multinational defence companies. Lockheed Martin Canada, General Dynamics Mission Systems, Arcfield Canada, QinetiQ Target Systems and others have built significant operations in the province. Alberta is also home to several dynamic small and medium-sized businesses situated in and supporting the defence space, including Landing Zones, Canadian UAVs, UVAD, Scope AR, GN Corporations and Guardian Chemicals Inc.

The University of Alberta exemplifies how academic institutions can mobilize regional strengths in support of Canada's defence strategy and economic prosperity. Historically, it was a leading officer training school during both world wars, and established the Khaki University to sustain the education of Canadian soldiers serving overseas during World War I.

Today it continues its defence leadership as a founding member of the Canadian military, veteran and family connected campus consortium initiative, and as one of only two university-based NATO DIANA test centres in Canada. The university is registered in the contract security and controlled goods program, ensuring secure infrastructure and compliance with national security requirements.

The University of Alberta's centre for applied research in defence and dual-use technologies, CARDD-Tech, is Canada's sole university-based centre dedicated exclusively to defence and dual-use technology innovation. CARDD-Tech has engaged closely with prime contractors, Canadian and international tier one suppliers, small and medium-sized businesses, and Defence Research and Development Canada, mobilizing over $25 million in R and D projects within Canada's defence ecosystem in the past year alone.

What has been achieved at the University of Alberta is the vision for a regional ecosystem where industry and end-users, especially the Canadian Armed Forces, are co-located in secure environments for research, development, testing and evaluation. This model of collaborative innovation provides a template for other post-secondary institutions in Canada, demonstrating how local strengths can be mobilized to meet national defence needs. The approach is strongly aligned with the Government of Canada's recently announced defence innovation secure hub initiative, DISH, positioning universities and regions to accelerate defence technology readiness and commercialization for the country as a whole.

Integrated university-housed ecosystems, anchored regionally, will be vital to the acceleration of national defence readiness, keeping jobs, expertise and critical technologies within Canadian borders while strengthening local supply chains. Universities provide the foundation for mission-driven research, talent generation pathways and agile trusted partnerships needed for Canada to secure its future and meet its international obligations.

I believe that the single most important policy initiative that can unlock the full potential of Canada's universities as strategic partners in building a robust defence industrial strategy is sustained funding for secure research infrastructure, directed to proven university partners with demonstrated success in translating concepts to operational technologies with end-users and industry.

These universities need dedicated federal investment to build and maintain secure research environments optimally designed for defence innovation. Urgent infrastructure priorities include facilities to simulate and test the resilience of Canadian-made technologies against electronic warfare attacks, labs for developing advanced materials critical for drone and hypersonic platforms, and capacity to nurture a sovereign, secure semiconductor manufacturing sector. Universities serve as the ideal nexus to manage these secure regional hubs, drawing on operational guidance from co-located military and defence industry partners. This approach will expedite the readiness of Canadian-made technologies, strengthening domestic supply chains and enabling access to global supply chains.

In closing, I'd like to invite the committee to imagine a future where Canada's security, that vital shield protecting our sovereignty, our people and our prosperity, is forged in the classrooms, the labs and the innovation hubs of our universities, where some of our brightest minds turn science fiction into mission-critical technologies, delivering solutions for today's threats while also building capacity for tomorrow's. It's a future where our universities and their networks are viewed as strategic powerhouses, laser-focused on uniting research, industry and the military in a single, secure ecosystem where concepts become innovations, students become specialists, and the collective capability and sovereignty of Canada's defence industrial base are strengthened.

Today, as Canada faces complex global challenges, recognizing—

[The Chair, Liberal, Ben Carr]

Professor Iyer, I appreciate the picture you're painting. I hate to cut you off, but we're 90 seconds over. Out of respect for the committee's time.... I'm sure our colleagues will have questions to send your way that will permit you to expand on that.

Next is Ms. Exner-Pirot.

The floor will be yours for up to five minutes for introductory remarks. Thank you.

[Heather Exner-Pirot, Director, Energy, Natural Resources and Environment, Macdonald-Laurier Institute]

Thank you, Chair and committee members, for the opportunity to speak to you today. I join you from Washington, D.C., where my think tank was co-organizing an event focused on the G7 energy and minerals summit.

We've all noticed how energy and minerals have been, as Minister Hodgson put it in Berlin in August, recentred in Canadian foreign and domestic policy in this past year. Canada is blessed with a tremendous resource endowment, but we have rarely thought of using it in any strategic way. As our adversaries lever their market dominance in energy and minerals in ways that harm our interests and those of our allies, it is essential that we consider ways that Canada can contribute to the security of supply.

With regard to critical minerals and the defence supply chain, the NATO alliance has only recently emphasized the issue, putting out a list of defence-critical materials last December. The United States has acted with more urgency since the Russian invasion of Ukraine in 2022. It has made numerous grants, loans and equity purchases, including through its Defense Production Act, DPA, under which Canada is considered a domestic supplier. The U.S. has made seven awards in critical mineral mining and processing in the last two and a half years in Canada, six under the Biden administration and one under Trump.

The main concern that is focusing everyone's attention is this: In the event of a protracted conflict—for example, with China over Taiwan—the adversary would have an unacceptable ability to restrict key materials and components needed for the defence supply chain. In a war of attrition, China would surely have the upper hand with its vertically integrated supply chain and ability to simply produce more tanks, more ships, more planes, more munitions and more drones. We are already seeing in Ukraine how important an adequate supply of defence equipment and supplies is and how a country such as Russia, with a GDP just the size of Spain's, can leverage its significant defence manufacturing base.

Canada's defence industrial base has unfortunately been allowed to atrophy for many years, and it will take time to build it back up. However, we can play a very important role in the alliance in the short and medium term by providing our allies with the raw materials they need to enhance their defence equipment production. Which materials would those be? The list should likely be derived from a cross-reference of minerals and mineral products that China has a monopoly on or has put export restrictions on, and the NATO critical raw materials list; there is considerable overlap between those two. In particular, Canada can play a role in bolstering the availability of gallium, germanium, tungsten, titanium, bismuth, graphite and some rare earths, and Canada is already a fairly significant producer of cobalt and aluminum.

Although it takes a very long time to develop greenfield or new mines in Canada, most of the commodities I just mentioned are things we already produce and refine, are by-products of things we already produce or refine, or are commodities for which we have old mines where we could restart production. We can do quite a bit in a few years, not a decade, and this is where an industrial strategy comes in. For most of these niche minerals, China has manipulated the market, and there's not a solid business case for private actors to produce these things. I am normally a laissez-faire conservative, but in the case of defence materials, the market is not free. It's incumbent on the government to step in to secure supply.

Canada has committed to dramatically increasing its defence spending. While procurement takes time, Canada can make some strategic investments in critical mineral production and processing in the short term and, if it were for defence purposes, could count it as defence spending.

I'll just note that the DPA funding awarded by the United States was matched in Canada through Natural Resources Canada, not through our Department of National Defence. I think it would be very advantageous to fund and prioritize these projects through the Department of National Defence, to significantly ramp up the funding, to act with urgency and to count it as defence spending.

The whole Chinese critical minerals dependency challenge will likely take a decade or more to untangle, but the defence supply chain itself is a relatively small market, and Canada could go some ways towards displacing China. This is an issue that Canada should own, take leadership on and help solve for our allies. We don't want to detract from acquiring the assets and systems that we actually need for defence, but we can do a lot with critical minerals in the short term as we ramp up those medium-term pieces.

Thank you for your attention, and I look forward to questions.

[The Chair, Liberal, Ben Carr]

Thank you very much.

In the room with us today is Ms. Redfern.

The floor is yours for up to five minutes.

[Madeleine Redfern, Chief Operating Officer, Northern Director, CanArctic Inuit Networks Inc., As an Individual]

Perfect. Thank you so much.

For those who don't know me, I'm an indigenous woman from Iqaluit, the capital of Nunavut. I'm involved in the high-tech and innovation sectors of telecommunication, digital, transportation and energy. I am the chief operating officer of CanArctic Inuit Networks. The goal is to build 3,000 kilometres of marine fibre optic cable into Canada’s Arctic and interconnect with as many existing or proposed subsea and terrestrial fibre networks. We need redundancy. Of course, I understand and appreciate how interconnected fibre is with satellites.

I'm also the CEO of SednaLink Marine Systems. The goal is to put sensors on certain strategic elements of the subsea fibre optic, effectively allowing sensors to monitor and obtain the necessary marine data with respect to climate change but also with respect to knowing what is in our marine environment, whether that is submarines or unmanned underwater systems.

I'm also the northern director of Arctic360, Canada's only Arctic think tank.

Lastly—I wear many hats, as many northerners do—I am a special adviser to Canadian Nuclear Laboratories and an indigenous member on the nuclear energy leadership table. Our goal is to assist and assess the potential micro and small modular reactors that can provide a full energy solution in rural, remote and northern parts of Canada. Almost all major infrastructure, including fibre optic cables to ground stations, to data centres and to over-the-horizon radar systems, requires energy. We need it to be stable, reliable, abundant, affordable and ideally, of course, clean.

I forgot to say that I am also a director of the Canadian Arctic Innovation Association. We published a study on the viability of airships for civilian and commercial purposes that supplements the airships study that was done by DND. Being able to move large items into Canada's Arctic year-round is a truly transformative initiative that would support not only our communities but also the military.

We know that Canada's Arctic requires investments. We need the very best long-term technological solutions that support not only our communities but also our national security objectives—not just now, but also for the next 50 years. A lot of my involvement and interest in these spaces was due in part to my being mayor of Iqaluit for two terms, president of the Nunavut Association of Municipalities and a member of the Arctic Mayors’ Forum, which had membership from all across the Arctic nations except for Russia.

In these various areas and capacities, the discussions have often centred on what is essential for critical infrastructure for our communities in our regions, which, as I said earlier, of course have been focused around transportation, such as expanding existing runways or seeing those runways paved so that we can actually see more large or specialized aircraft land in those communities, increase the size of the airplanes for food delivery or allow for air force planes to land.

We know that in the Arctic there are many intersectionalities and the necessity for integration. However, these different layers of government and various government departments often create silos, and by extension disconnections and divisions. What I have learned is that at the top, infrastructure priorities and requirements of our northern communities also nicely align with what the military want and need, but despite these, fragmentations and many non-strategic infrastructure investments that have been made in Canada's Arctic unfortunately continue on.

While we know that we're hearing the Government of Canada speak about the necessity of dual-purpose and multi-purpose investments, the reality is that almost none of our government departments know how to put this in practice. In fact, when government departments are pitched with true dual-purpose infrastructure, most will state that their departments have no role or responsibility. I could give you numerous examples, but I'm mindful of the time.

In closing, we recognize how important industry is in being part of the solution as are, as you also heard, universities, defence, our northern communities, our northern leaders and our indigenous leaders.

The challenge is how we ensure that, as we move forward in determining what strategic investments the Arctic needs, we invest in the right ones with the best outcomes that support not only our local security at the community level and our economic development aspirations but also our big national security objectives.

Thank you.

[The Chair, Liberal, Ben Carr]

Thank you very much, Ms. Redfern.

Madame Dancho, the floor is yours for six minutes.

[Raquel Dancho, Conservative, Kildonan—St. Paul, MB]

Thank you, Mr. Chair.

Thank you to our expert witnesses for being with us today and sharing your time with this committee on this important study.

My first few questions will be for Ms. Exner-Pirot concerning your expertise on critical minerals and the role they play in our defence sector.

I think most Canadians understand that we have critical minerals in Canada, but perhaps their appreciation for how very blessed we are relative to other countries is relatively unknown. We've had governments at all levels that have been opposed to various mining developments and the like or, if they do approve, it takes many years.

For the purposes of this committee in looking at a defence industrial policy, could you give us a bit more information on why it is critical that we take our natural resources in the mineral sector seriously and move more quickly to develop those resources?

[Heather Exner-Pirot]

It's obvious that we're in a geopolitical era that is marked by conflict, tension and possible outright conflict as we see that Russia invaded NATO airspace this week, last week and the week before. It feels like we are getting closer to conflict. The U.S. secretary of war just invited all the generals to D.C. to warn them to prepare for war.

How we won wars in the past was by having a better defence manufacturing base able to produce more and out-compete and outlast the competition. We have, in the last 20 years, very much globalized supply chains. China has absolutely been strategic in taking advantage of that and dominating some important supply chains that are essential. They're critical, as we call them.

We at least need to focus on being able to be independent in our defence manufacturing base. We cannot allow China, number one, but also other adversaries to control what we can produce and to hamper that production.

That's why we need to act with some urgency here. Not a lot of our NATO allies have the ability to do that, but Canada does.

[Raquel Dancho, Conservative, Kildonan—St. Paul, MB]

Thank you.

My understanding is that, while we have the raw materials—and of course we can do a much better job of ensuring we get them out of the ground—and that's a big asset, what we currently produce and what we could maximize for our allies.... We export raw materials, but perhaps not as much effort is on creating the defence things out of those raw materials.

Is that an accurate assessment, or are we doing both things well? Overall, what is your assessment there?

[Heather Exner-Pirot]

It is definitely accurate. Our manufacturing has declined, as has almost every Western country's manufacturing base, but Canada has a competitive advantage in raw materials production. We should work with our allies to figure out what part of the process we hand over. Is it materials or how processed or how refined they are so they could put them into their manufacturing base in the short term?

You can't produce anything if you don't have the raw materials. That is one area where Canada can shine and make sure that they are at a stage where we can hand them over to allies and their producers who can put them into materials.

[Raquel Dancho, Conservative, Kildonan—St. Paul, MB]

Can you just provide some basic examples for everyday Canadians, who may understand that yes, of course, there are things that go into these defence materials, of what Canada has and critical things for our defence procurement that we need that it creates or contributes to?

[Heather Exner-Pirot]

Yes, there are quite a few. I'll mention gallium and germanium because these are things that China has put export restrictions on recently. They are by-products of things we produce.

If you didn't know—and I think we all know—we are big aluminum producers. Gallium is a by-product of that, and the market for gallium wasn't very good. China kept prices very low. There was no incentive for anyone to turn that into a product, so China developed an almost complete monopoly on gallium. Again, the market is very small and niche. It's not a lot of money, but you still need that for components to make things.

It's the same with germanium. It's a by-product of zinc refining, which we do in Trail, B.C. Again, the market was so small that there wasn't a lot of private sector incentive to compete with China on it.

It won't take a lot for Canada to develop the things we already have and to develop a tack to start processing them so that we can use them in our own supply chains.

[Raquel Dancho, Conservative, Kildonan—St. Paul, MB]

What sorts of products would come out of that?

[Heather Exner-Pirot]

There are lots of lists you can see, things like munitions, materials like tungsten and bismuth you need to make things hard. Obviously, there's every component of a battery. A lot of warfare now is being conducted through drones. You need particular components for batteries for that and all the things that go into a battery, which China has dominated. There's aluminum. I mean, at the end of the day, when you're building all these things, you need a ton of aluminum. NATO actually declares that a critical raw material, even though we're having a hard time finding buyers for our aluminum in Canada right now with the tariffs. You would hate to lose that capacity, because in the event of a conflict, you would need so much aluminum production to keep up.