But isn't ITAR-friendly.
Evidence of meeting #37 for National Defence in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was boeing.
A recording is available from Parliament.
Evidence of meeting #37 for National Defence in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was boeing.
A recording is available from Parliament.
9:10 a.m.
Liberal
Denis Coderre Liberal Bourassa, QC
You know that the process is extremely important in our analysis. Can you table before the committee all the correspondence between your officials and National Defence's officials dealing with briefing on the ITAR issue?
Before signing a contract, well, since you're a good lawyer, you have a plan B, as you said, and you want to make sure that everything is as it should be before you sign off on a contract.
Would you be prepared to table your correspondence before the committee, and be transparent like Gen. Lucas was last week, so that we can get a firm grasp of what went on in yyour briefing? Would you be willing to do that?
9:10 a.m.
Minister of Public Works and Government Services
No. I'll table what should be tabled and if it is required by law, and nothing else, Mr. Coderre.
9:10 a.m.
Conservative
9:10 a.m.
Conservative
Russ Hiebert Conservative South Surrey—White Rock—Cloverdale, BC
Thank you, Mr. Chair.
My colleague in her previous round of questioning talked about an issue that I think is worth delving into a little bit deeper. Mr. Coderre has repeatedly argued before this committee and in public that it would be far better for the military to lease or rent strategic airlift from our allies than purchase it. Now, apart from the fact that every military witness who has been before this committee has testified that purchasing these aircraft was the best option, I want to talk about the possibility that--heaven forbid--if the Liberals were to return to power, they would cancel the contract.
This certainly wouldn't be a first time, as you probably know. As you may recall, the Liberal government, as one of its first acts of power in 1993, cancelled the EH-101 contract that had been negotiated by the previous Conservative government to replace the aging Sea Kings. At the time the Prime Minister called these helicopters just too expensive. He dismissed them as Cadillacs, as being too good for the military, and the previous Liberal government paid a $470 million penalty to cancel the contract. They then took 11 years to identify a suitable replacement, which is the H-92 Superhawk, at a cost of $5 billion. This was a billion dollars more than the EH-101 contract, and now we're expecting delivery in 2009, when we would have had the previous helicopters for several years now.
So my question to the minister is this. What would be the consequences if the Liberals were to return to government and cancel yet another contract for much-needed equipment for our military?
9:10 a.m.
Minister of Public Works and Government Services
Sorry, I missed the beginning of the question. Did you ask what would happen?
9:10 a.m.
Conservative
Russ Hiebert Conservative South Surrey—White Rock—Cloverdale, BC
What would be the consequences if they were to return to power and cancel yet another needed purchase for our military?
9:10 a.m.
Minister of Public Works and Government Services
As I said earlier, this is an enforceable contract, so if they cancelled it we would face litigation from Boeing. I can't tell you what the outcome would be, but this is an enforceable contract, and hence it could cost us a lot of money, for sure, most definitely.
That's number one, and number two is we'd need to go back to the drawing board in terms of providing our armed forces with the type of airlift they require, which is really also almost as important as the financial consequences, when you think about it. They've been deprived of these assets for too long. When we formed the government, we faced the situation that basically the Liberals had, for reasons of their own--I'm not quite sure what they were--decided not to equip the military as they should, particularly given the theatre they're in right now in Afghanistan. They actually sent them to Afghanistan.
Hence we're stuck having to equip the military. And I think we've gone about it the right way in the first phase of our C-17s, and I think our military are happy at the type of acquisition we've made. So if we were to cancel this, there would be financial consequences and there would be dire consequences, I think, also in Afghanistan and elsewhere where our forces serve.
9:15 a.m.
Conservative
Russ Hiebert Conservative South Surrey—White Rock—Cloverdale, BC
Considering that the contract that was cancelled by the previous Liberals was about a $4 billion contract and the penalties that were paid were $470 million, the C-17 contract being close in rough numbers to that same amount, is it not hypothetically possible that the penalties would be several hundred million dollars?
9:15 a.m.
Minister of Public Works and Government Services
It could be. Listen, clearly it's going to be very expensive. Again, it's an enforceable contract. These aircraft are going to be delivered. We've signed a long-term in-service support agreement, so the consequences financially would be awful. There would just be clearly—
9:15 a.m.
Conservative
Russ Hiebert Conservative South Surrey—White Rock—Cloverdale, BC
For the government and the taxpayers.
9:15 a.m.
Minister of Public Works and Government Services
For the taxpayers, and then for the military, as I said, they'd be devastating.
9:15 a.m.
Conservative
Russ Hiebert Conservative South Surrey—White Rock—Cloverdale, BC
Mr. Chair, I'll share the balance of my time with my colleague Mr. Calkins.
9:15 a.m.
Conservative
Blaine Calkins Conservative Wetaskiwin, AB
I believe I had a question on the paper, if you remember what it was. By the time I ask it again, my minute's going to be up.
9:15 a.m.
Conservative
Blaine Calkins Conservative Wetaskiwin, AB
In the project management life cycle, at what point does Public Works get involved? When does DND hand it off? Is there collaboration throughout the process? How is that working, and how is it being changed, if at all?
9:15 a.m.
Minister of Public Works and Government Services
I'll let Terry answer that question with respect to the military per se.
February 20th, 2007 / 9:15 a.m.
Director General, Land, Aerospace and Marine Systems and Major Projects Sector, Public Works and Government Services Canada
We're involved quite early in the process. Certainly the production of the statement of requirements is done with the military, by the military, and for the military. But once they have that produced, and they've decided to embark upon a project, we're involved very early in the game in what are called integrated project teams. So we get an understanding of exactly what the military is attempting to procure.
Then we go into interdepartmental committees, where the requirements that the military has put forward are challenged, and not just by us, but by our colleagues in the Treasury Board Secretariat, PCO, Finance, Industry Canada, the regional agencies, and Indian Affairs. Everybody has an opportunity to have a challenged function to make sure that everyone understands what the requirements are and that everyone is essentially in agreement with the project going forward.
From that point, we work closely with our colleagues in National Defence and Industry Canada to bring the project home.
9:15 a.m.
Conservative
The Chair Conservative Rick Casson
Thank you very much.
To finish up the second round, we have Mr. Coderre.
9:15 a.m.
Liberal
Denis Coderre Liberal Bourassa, QC
Thank you very much, Mr. Chairman.
Let's imagine, Mr. Fortier—given that Canada is a very generous country—that a disaster occurred in Cuba and that the C-17 was used. We get to Cuba, deliver the goods, just like we did with the Tsunami and in other situations. That's appropriate, that's normal, from a humanitarian standpoint. The plane is damaged, and there's a defect.
Are you aware that because we're talking about Cuba here, and also because of American security regulations, we wouldn't be able to, for instance, get the missing part needed to repair the plane? When you signed the contract, did you consider that?
9:15 a.m.
Minister of Public Works and Government Services
As far as maintenance is concerned, Mr. Coderre, and more specifically what would happen should an aircraft encounter difficulties in a particular country, I'd have to ask Mr. Williston to answer that question as, I'm sure you'll agree, it is more technical.