There are some quick fixes, and then there are some more strategic “systems change” answers to your question, Mr. Ste-Marie.
On the quick fixes, you know, it's almost like the Hippocratic oath that doctors take of “First, do no harm.” The first thing I would ask is a simple change to the DND IDEaS program, which has so far proven itself wholly insufficient in so many cases.
I'll give you an example. If you look at the challenge sandboxes in the U.K. or the United States that try to get homegrown start-ups to test their technologies and are their versions of DND IDEaS, you'll see that if you win one of those challenges in the U.K. or the United States, you are automatically plugged in to a procurement stream. That is how it's supposed to work.
In Canada, if you win an IDEaS challenge, not only does it grant less money and take more time, but in many cases you are in fact prohibited from going into a procurement stream. That is almost Kafkaesque, in that it achieves the opposite of the goal that it's meant to achieve and does not align with best practices in any other NATO country. Addressing that would be a quick fix.
For another quick fix, there seems to be a cultural issue. In some of the qualitative results that we turned up in our survey, we turned up horror stories from Canadian SMEs, and I'll give you an illustrative example. I've heard a version of this story seven or eight times.
An entrepreneur who does light manufacturing out of Kitchener-Waterloo in Ontario called me and said that they'd made a heat sink or a cold plate, a little device that ends up going into a light armoured vehicle. In the past it's gone into a CF-18. They sell only into the NATO supply chain.
This entrepreneur told me that over the course of 18 years, he has been debanked not once, not twice, but three times by a tier one Canadian bank. Why? It wasn't because he's doing anything illegal but because there's a stigma around defence, a perfectly legal industry, and some local banker just decided to act on their own and debank this individual and not provide him credit. He got the letter saying that they need his money out of his account in 30 days.
There's a cultural issue here too, and as my learned colleague Mr. Smith alluded to earlier, hopefully unlocking capital from the BDCs and the EDCs will help free up the Canadian banks to feel better about lending to perfectly legal industries.
Then on the systems change side, again there are a couple of things, like the DIU model in the United States and the NSSIF model in the U.K. These are off-the-shelf models to help make sure that even when we're doing targeted procurement of massive foreign systems, we're still using that to do aggressive licensing of technical data in direct support of domestic innovation when we have to buy foreign systems like submarines.
The last thing I would say is that there has to be an element of borrowing off-the-shelf best practices. We need to push procurement authority way down to the command level, and I think this riffs off Mr. Greenley's point earlier about restructuring. In the countries that do this best in the NATO alliance, not every procurement decision is made at a centralized level. You can set a threshold—call it $200 million illustratively—and say that a commander is able to bring a start-up on base and test it out, and if there's a solution that's 80% there at 25% the cost, they can buy it tomorrow.
Yes, that will lead to some duplicative buying, but that trade-off is worth it to get the capabilities into the hands of the Canadian Armed Forces much more quickly.