National Defence Committee on March 1st, 2007

[The Chair, Conservative, Rick Casson]

I call the committee to order.

Thank you all for being here this morning, as we continue our study of the procurement and associated processes to do with the Department of National Defence.

Today we have two sessions, one from nine to ten, and then one from ten to eleven. In the first session we'd like to welcome Douglas Bland, the chair of the defence management studies program, School of Policy Studies at Queen's University, and Alan Williams, former Assistant Deputy Minister (Materiel) of the Department of National Defence. We have these two gentlemen from nine to ten, and from ten to eleven we have the Auditor General.

As usual, we turn the floor over to the witnesses to make brief statements, and then open it to a round of questions.

Mr. Bland, I understand you're going to start. Go ahead, sir.

[Dr. Douglas Bland, Chair, Defence Management Studies Program, School of Policy Studies, Queen's University]

Thank you, Mr. Chair.

I thank the committee for the opportunity to speak with you today.

I've been following your transcripts and your conversations at a distance. In fact I've engaged a couple of graduate students to keep track of the debates that have been going on and the questions and answers. I'm sure you realize this is great food for op-eds in newspapers, but it's also a great case study for students who are trying to understand what I like to call a vigilant Parliament.

I have to apologize for not providing you with any notes beforehand. It was reading week at Queen's last week, and I read something else. The graduate students were looking at the transcripts until last night, when I read them all.

I want to preface this morning's discussion with some remarks that I think will put the issue of defence procurement, as I see it, in context.

The first problem to be addressed is not procurement but the ongoing and immediate capabilities crisis in the Canadian armed forces. The procurement problem is not a crisis of process but a crisis of decision. This is, in any case, a second-order matter, though not an unimportant matter. Let me explain this line of reasoning, and then at the conclusion I'll make some remarks about some of the issues I think have highlighted this debate.

In 2004 a research team at Queen's University published an often quoted work. I'll advertise it. It's called Canada Without Armed Forces.

I asked the researchers a seemingly simple question. It was the question that I think should engage the House and this committee of inquiries over any number of years. The question I put to them was simply this. Based on the capabilities of the Canadian Forces, defined as equipment and people available in 2003--the research year that we did this work--and the signed contracts for new equipment on the table at the time, what would the Canadian armed forces look like in five years, ten years, and fifteen years further out?

Let me briefly read you the main findings of that research. The study revealed a future force undeserving of the title. Rather rapidly and then inevitably, in five years to ten years, Canada's major military equipment will succumb to the combined effects of overuse and technical obsolescence, making them operationally irrelevant. People with the right balance of age, experience, and training will not be available to replace those who will leave the armed forces over the next several years. Support equipment is disintegrating, and little has been done, or can be done in some cases, to stop it, because spare parts and technicians are not available to solve the problems.

Canada is heading for a long period when the government will be without effective military resources, even for domestic defence and territorial surveillance. Even if the next government were to provide nearly unlimited funds in an attempt to overcome this crisis, this deficit, little can be done before the apprehended crisis becomes fact.

Mr. Chairman, this is a statement of the national defence crisis facing this committee and Canada. This is a crisis that no one in the defence establishment at the time refuted, except to say, lamely, we have plans. What they did not say is that we have no money and we have no political support to act on the crisis.

The crisis is upon the nation, and it is unfolding much as we described. Time is the enemy, not money. However, the crisis is overshadowed by the gallant and persistent efforts of General Hillier and members of the Canadian Forces, who in combat operations are making do.

The response one might expect from a vigilant Parliament would have been immediate action to forestall the most dangerous aspects of the crisis. But such action was stalled for two main reasons, in my opinion: first, by a failure of the political community to act in unison to develop a non-partisan national defence strategy; second, by a muddled, directionless public bureaucracy, incapable of developing a plan to resolve the crisis.

That brings me to Mr. Alan Williams' study, which was just completed with our program at Queen's University over the last year.

Again, as with Canada Without Armed Forces, when Mr. Williams started this study I put to him what I thought was a straightforward question. I said to him: “Alan, what would you do if the Prime Minister came into your office and said to you that he wanted the Canadian armed forces rebuilt in five years, or else, and then he left the room? What procurement reforms would you make to accomplish this task?” That's the question.

The result of his work was Reinventing Canadian Defence Procurement, A View from the Inside. It's on the table, I believe, or it's certainly available.

I want to point out that the title Reinventing Canadian Defence Procurement is not accidental. The title was meant to convey starkly that reforming the process, adjusting procedures, or throwing money around Ottawa is not good enough. I'm not interested in reforming failures. Thus, the title and the intent of the research, as Alan Williams will describe in a few moments, is to create a defence procurement system to meet the current crisis, and with political support to prevent the crisis we are now in from recurring.

Let me turn now to six issues on the present debate and to discussion about defence procurement that concern me and some of the citizens, students, and other people I speak to often.

First, what we procure and how depends on your answer to this question. What do we want the Canadian Forces to do? The answer, in my view, is confounded by those who try, for whatever reason, to attach or hobble defence policy in the Canadian Forces to specific tasks and missions such as peacekeeping or domestic operations.

In my view, the object of our defence forces must be to develop efficient, effective units that can, at the direction of the government, apply coercive and, if necessary, deadly force to situations endangering Canada's security and defence.

Defence procurement and defence administration generally are the instruments that must be used to provide the means to reach this end. Every other policy or decision that inappropriately interferes with this effort adds negative costs to defence policy.

My second point.... The Canadian armed forces are composed of certain basic capabilities that provide the foundation for operations. No matter what missions governments place on the Canadian Forces, Canada's geography will demand that large sums be spent on transportation, communications, surveillance, and technical capabilities. This suite of capabilities should be considered as operational overhead, without which the Canadian Forces will not be able to conduct any operations in Canada or elsewhere. For this committee and others like it in the future, the question to the government is not whether we maintain these capabilities, but how we do so efficiently and in time to avoid crises in defence and foreign policy.

Thirdly, I have a couple of words on competition within the process, and here Prime Minister Mackenzie King's ambiguity is always useful: competition if necessary, but not necessarily competition as we might think of it in “normal times”.

Alan Williams and I have had long discussions--I think that's a fair word--on this topic. And I think we agree, though our agreement is conditioned by circumstances: in my case, by the circumstances we face today. I will of course let Mr. Williams speak for himself.

The assertion is that competition helps lower costs, and generally I agree with that position. In recent times and debates and statements, critics have declared that the lack of competition, as they term it, on some projects now on the table cost Canadians a lot of money. Non-competition is, in effect, a tax on defence procurement.

My view in the present circumstances is that whatever extra spending there may be is a tax caused not by lack of competition, but by failure of governments to make timely and necessary procurement decisions, decisions that have to be made in time for careful, reasonable competitions to occur. Because we didn't make decisions and are now in a crisis situation, the tax that Canadians are going to pay follows from that, and not from a lack of competition alone.

Fourthly, in the current debate I think we sometimes lose sight of the first principle. The critical requirement is to provide members of the Canadian armed forces with the capabilities necessary for them to do what governments ask the armed forces to do.

In the current discussions much is made of the supposed rush to buy aircraft, but today I would like to emphasize that in the list of statements of requirements as part of that discussion, time is as valid a factor as is any other factor. Indeed, today for aircraft, ships, vehicles, and people, time may be the overriding factor. Napoleon once cautioned his marshals to ask of him anything but time. I think it is a caution that governments today might take heed of.

Fifth, I am, and I was, disturbed by the apparent reluctance of officials to engage in or encourage any substantial discussion on the relationship between process, government organization, accountability, and outcomes. Witnesses have said to you, “There is no need to massively overhaul the system, nor is there any requirement to create new agencies or organizations”. They went on to emphasize and praise “the dedication and professionalism of the civilians and military members” in the system and all the various departments involved in the process. They conceded, however, that “A lot of challenges remain, but they are not insurmountable”.

Unfortunately, as far as I can see from the transcripts, the witnesses did not describe what the challenges might be, but implied that Parliament ought to trust us. But if the process and the structure and the organization are fine, what accounts for Canada without armed forces? Perhaps it's members of Parliament. That seems to be the only answer to the witnesses' statements.

The problem in the system can be explained, can be talked about. And when we ask why does the system fail, I think the answer is we don't know why the system fails. And we don't know why the system fails because there is no member of Parliament, no minister who is responsible to tell you why the system works or why it fails. There are just a lot of members who have things to say.

My final observation is that in my analysis of the session so far I worry that in the continuing and recurring evidence and questions we are missing the wartime context of the matter that's before you. I think it is strange that members of Parliament and the political community generally will argue over $400 million or $500 million and where contracts are going, while at the same time we're spending lives in Afghanistan and elsewhere to meet the government's and Parliament's objectives.

I think we need to discuss not just the dollars, but what is happening to rebuild the armed forces. From my non-partisan political perspective--and I have no political bones at all, of course, or sense--I don't know why the government isn't being challenged for not buying six C-17s. We had 32 Hercules. Why are we arguing over buying just a few, when perhaps government should be challenged to buy 32? Why aren't we rebuilding the armed forces instead of arguing over things as though we were discussing matters in some sort of abstract situation?

Mr. Chairman, let me return to my opening statement. The crisis this committee is dealing with is not defence procurement as a sometime matter abstracted from circumstances of the times. Canada and the Canadian Forces have been in the midst of a war since about 1992. And we are finding ourselves by our own decisions and choices conducting operations--that is, spending lives--while the capabilities of the Canadian armed forces are literally disintegrating as we talk.

Managing defence procurement in the crisis of failing capabilities and now in wartime demands is demanding, costly, and the prime responsibility of this Parliament. Defence procurement and managing this war demands an agile whole-of-government approach to the problem.

I recommend that this committee conduct its inquiries with this idea in mind. In that regard, and in advance, I strongly recommend that the committee accept Alan Williams' recommendation for the establishment of “Defence Procurement Canada” to manage the whole-of-government system for defence procurement.

Finally, the question I think Canadian political leaders should be prepared to answer is this: What exactly are you going to do, what is your funded plan, to rebuild the Canadian Forces over the next five years? I think Canadians might like to listen to that answer.

Thank you, Mr. Chairman.

[The Chair, Conservative, Rick Casson]

Thank you, Mr. Bland.

Mr. Williams

[Alan Williams, former Assistant Deputy Minister (Materiel), As an Individual]

Thank you, Mr. Chairman.

It is a great pleasure to be back here again, albeit in a different perspective, with my friend and colleague, Doug Bland, to discuss Canadian defence procurement. I will keep my remarks brief so we can have as much time as possible for questions.

Defence procurement is a subject that I am very passionate about and have devoted over ten years to learning and overseeing both at Public Works and Government Services Canada and at the Department of National Defence. Having seen first-hand and up close the tremendous dedication and commitment of our men and women in the military, I do not view this subject merely as an administrative exercise, but rather one that above all must see to their security interests.

In spite of the recent proliferation of reports and studies, the process is still accused of being too lengthy and too costly. Why is this the case, and how can it be improved? The answer, I believe, lies in two facts.

First, heretofore this very complex process has been examined in a piecemeal fashion rather than in a broad, comprehensive manner. As a result it has been difficult, if not impossible, to gain a true understanding as to how all the components fit together. Second, implementation of change has not been given adequate attention.

It was with these limitations in mind that I took to writing Reinventing Canadian Defence Procurement: A View From The Inside. I believe that for the first time anywhere, this book provides a complete and comprehensive description of the entire defence procurement process as well as a road map to implement the 25 recommendations made in the book.

If there is truly a desire to improve the process, I believe I have removed the mystery as to how it can be done. The book not only describes the process, but also provides insight into the behaviour of the players in the process so that one can understand why they are motivated to act as they do. Seeing how everything fits together, we can ensure that the recommendations align together to address the real weaknesses, not the perceived ones.

For example, at a lecture on topics in defence management at Queen's University, I asked the students if they thought the following five statements were true or false:

(1) The bureaucratic defence procurement process is unresponsive.

(2) There is too much political interference in the defence procurement process.

(3) The major funding pressures in the Department of National Defence are to pay salaries and benefits for military personnel and to acquire capital.

(4) It costs less to maintain new equipment than the equipment being replaced.

(5) Canada is dependent upon others, especially the United States, for strategic lift capability.

Perhaps, not surprisingly, most of the students agreed with each statement. In fact, each of these statements is more false than true. Allow me to comment briefly on each.

First, the bureaucratic process can work rather quickly. It took less than two years to sign a contract for the new maritime helicopters from the time Defence Minister David Pratt gave the go-ahead. The most significant cause of the delay was awaiting government approval to proceed.

Second, in the ten years that I have been responsible for procurement, I have not been aware of any instance where a minister has influenced the outcome of any defence procurement. This is largely due to the legal consequences resulting from the passage in the mid-1990s of the agreement on internal trade, or AIT.

Third, today more money is spent on maintaining equipment than on acquiring equipment. Yet historically, emphasis was placed only on the initial cost of acquisition, leaving the department somehow to find the additional funds to support the acquisition. The usual source was the National Defence capital budget, thereby eroding it even further.

Fourth, the costs to maintain new equipment are greater than for the old equipment being replaced. It will cost more to maintain the new maritime helicopters than the Sea Kings they replaced. Today's weapons systems are essentially complex software systems that require frequent and expensive updates and revisions. Accordingly, at the outset of any capital program it is necessary to obtain funding not only for the acquisition, but also for the full life-cycle costs.

Fifth and finally, with respect to strategic airlift, it is noteworthy that as of April 2003, when I last asked for the information regarding Operation APOLLO, Canada had moved three times the amount of freight and five times the number of troops for the Americans as they moved for us. The reality is that in coalition warfare each country contributes assets to complement those of its allies.

In retrospect, I probably should have added one more myth--namely, that directing or sole-sourcing a contract speeds up the procurement process. In fact, you can lose more time trying to find ways to avoid competition than conducting an open, fair, and transparent competition.

In addition, sole-sourcing is generally a lose-lose-lose proposition. The taxpayers lose, as more of their money is usually spent on sole-source or directed contracts than when a competitive process is followed. Industry loses, as the quantity and quality of industrial and regional benefits demanded can be compromised. And the military loses--doubly. First, the excess expenditures come from their budget. Accordingly, these funds are not available for reallocation to meet their other priorities. Second, without competition we generally cannot be certain that we are acquiring the best equipment that meets the needs of our men and women in the military.

In my book, I discuss and make recommendations in three broad areas: the legal framework, the industrial impact, and the core procurement process itself. In my brief opening comments, I will just touch on the process, but of course I would be pleased to answer questions on all of the areas.

If there is one overarching observation that can be made, it's that there is a lack of clear accountability at all levels in the process--the parliamentary level, the ministerial level, and the bureaucratic level. The good news is that it is all fixable. I provide details on how it can be done, and done quickly.

In the book, I quote from an Ottawa Citizen article in which Anne McLellan, in addressing a specific defence procurement, refers to Defence Minister Bill Graham and Public Works Minister Scott Brison as the two ministers in charge of the procurement. She was right. With respect to defence procurements, ministers from these two departments are in charge. The problem is that whenever two ministers are in charge, neither is in charge. It is time to address this reality.

Perhaps the most significant of my 25 recommendations is the creation of “Defence Procurement Canada”, or DPC, an organization that combines the procurement resources from National Defence and the contracting resources from Public Works. It becomes the sole organization accountable for defence procurement. While I present five different governance models, I favour the one whereby DPC reports to the Minister of National Defence. Under this model, the Minister of National Defence is accountable for all elements in the procurement cycle, from the preparation of the statement of requirements, through the request for proposals, through the evaluation, and through the contract signing and administration.

The benefits generated from such a model go well beyond clarifying accountability. Significant resource savings will result due to the overlap and duplication of the duties and responsibilities. My conservative estimate is in the range of 48 and 125 person-years, or annual savings of between $4.8 million and $12.5 million annually. Equally important, it alleviates a large skill shortage problem that is becoming even more serious as the population ages.

The process will also be streamlined. When two departments are involved, the process moves only as fast as the slowest of the two. In the book, I cite one example where it took nine months for National Defence to negotiate a deal and over 21 months for Public Works to agree to it. While this may be an extreme case, the reality is that getting approvals through two channels rather than one takes extra time, and therefore slows down the process.

That being true, an obvious question arises--namely, why was the process structured this way in the first place? The answer is twofold. First, Public Works' role was designed to ensure integrity in the process. However, today there are other mechanisms that serve the same purpose. These include the Canadian International Trade Tribunal, the court system, the Auditor General of Canada, the media, and the general openness of our society. All help guard against any wilful manipulation of the defence procurement system. DND and PWGSC personnel are well aware of the dangers in operating with anything less than full openness, transparency, and fairness.

A second argument for the involvement of Public Works is its role as a common service agency, achieving government-wide savings. However, it is quite clear that in this case we are limiting ourselves to defence-specific goods and services, with no potential savings benefits to other government departments.

Delays in the procurement process arise from primarily three sources: first, awaiting government approval to proceed; second, excessive time for the military to finalize their statement of requirements; and third, overlap and duplication between National Defence and Public Works. Accordingly, with Defence Procurement Canada fully accountable, regular reporting on performance can be requested and expected from DPC, including reporting on the causes of any delays.

Finally, my advocacy for DPC should in no way be construed as a criticism of the people in Public Works and National Defence who work on defence procurement. To the contrary, I can personally attest to their smarts, energy, commitment, and integrity. They do magnificent work within the existing governance framework. Imagine what they will achieve once the constraints are removed.

In closing, Mr. Chairman and members of this committee, I am confident that, taken together, the full package of recommendations in the book will address the weaknesses in Canadian defence procurement and make it the best it can be now and in the future. Our men and women in the forces deserve nothing less.

Thank you, and I'll be pleased to answer your questions.

[The Chair, Conservative, Rick Casson]

Thank you very much, Mr. Williams and Mr. Bland.

We'll open it up for a round of questions. It looks like we're going to have enough time to get all four parties involved in just the one seven-minute round. So you can divide it up among yourselves however you wish.

Mr. Coderre, you have seven minutes.

[Denis Coderre, Liberal, Bourassa, QC]

Thank you, Mr. Chair.

I think if we want to have a definition of a breath of fresh air, it is the two witnesses today. Thank you very much. We are really and truly appreciative.

The reason we have this session is to seek solutions. We're not just here, as we say in French, définir le sexe des anges. We are here because we want to have that agenda of vigilance. We believe we should work not only on the issues, but on the perception too, because when we're talking about integrity or accountability, we also need to manage the perception if it's still there.

Mr. Bland, the reason the Liberal Party questioned the acquisition of four C-17s is that we believe we can use the money otherwise, and we should have a definition that includes the word “access” instead of “acquire”. If we work as a coalition and if the air force has had some options in the past to lease, I don't see why we should spend billions of dollars when we won't possess the intellectual property for the industry. If the people from DND want to work with the equipment, we have the ITAR and we have all those issues.

I'd like to ask you one question. It strikes me when we talk about mission, of course, that our role for the armed forces is based at the domestic level. We have the politics of our geography. There's also the issue of international responsibility. Do you believe we should just create an armed force like that? Why can we not have Canadian Forces based on what we want to do at External Affairs or domestically?

How would you definite it yourself? If you're the Minister of Defence, for example, and you have to make a decision to build up your Canadian Forces, how do you make it happen? It's kind of abstract in my mind to say that we won't create an armed force because we want to fulfill our duties with NATO, with peacekeeping or peacemaking and at the domestic level. I didn't quite understand what you meant by that.

[Dr. Douglas Bland]

I'll try to keep the answer short.

The strategy for our armed forces, which most of us here are used to, comes from fifty years of the Cold War. It was a period in which we had what I refer to as a strategy of commitments. In other words, Canada had certain commitments, mostly with NATO, a little bit with the United Nations, and with NORAD, and to ourselves. As long as we were building forces to meet those concrete commitments, everybody was happy.

Once the Cold War ended, we didn't have that strategy any longer. NATO didn't have a strategy. The United States has a different strategy. The UN never has any strategy. We're like the kid in the movie: we're home alone. We had to decide what we were going to do with our own armed forces. What you do in that situation, in my view, because you don't have concrete mission statements any longer, concrete commitments, is to generalize the purpose of your armed forces.

What do armed forces do that no other segment of society does? Why are they a group of Canadians set aside from society for a special purpose? The special purpose is combat operations--land, sea, and air, and in combination. Many of those other things that armed forces do--fight floods in my home town of Winnipeg and forest fires and do incidental peacekeeping missions here and there--are jobs that could be done by someone else. Why would you spend a whole bunch of money on an armed force to do things that someone else can do?

So the point is to concentrate on the specific, necessary advantage that armed forces give you, and then work your defence policy from that point of view.

[Denis Coderre, Liberal, Bourassa, QC]

Thank you.

Mr. Williams, I think it is fair to say that one of the most important factors in procurement policy is accountability. One has the impression, and I am not being partisan here, since we saw the same thing when the government was Liberal, that there is a ping-pong game going on between the departments. I am therefore in favour of this agency.

I would like to talk more specifically about your experiences. You talk about current political interference. When giving his speech a few years ago, General Hillier described himself as a man of decision. He said it was not up to him to go over 15,000 pages of criteria, that he defined four or six principles and decided which planes, helicopters and everything else that he wanted to acquire.

We get the feeling when

what we call the SOR, the statement of operational requirement,

is being prepared at National Defence, that they arrange things to get what they want.

How can we talk about the integrity of the process if we really feel like the dice are loaded from the start? How can we talk about competition when we know, in terms of conditions, that the policy really consists of drawing lines in the sand?

Could you please elaborate on the question of political interference? How can we prevent this type of thing?

This will perhaps be my last question.

We're talking a lot about the paper anything and saying that out of the shell is the greatest thing. Would you make a difference between out of the shell and the paper plane, for example? I believe it's always upgrading anyway, and you don't have such a thing.

Maybe if we want to have a true competition, instead of playing with the requirements, we should stick to the plan, and like the C-17, have two companies and may the best one win.

What do you think?

[Alan Williams]

In my opinion, you put your finger on the most important point.

That's the accountability.

As I made the point in my comments and in the book, I think all levels of accountability are not where they ought to be, if in fact the process is to be the best it can be. Without being too critical in front of you, I do make the point fairly dramatically in the book that I think this committee can play a much greater oversight role in being made aware of defence procurement plans and having strategic discussions.

As my colleague mentioned, how do these acquisitions link to the defence policy paper? How will they ensure that it allows the military to do what the government wants them to do, what Canadians expect them to do? The kinds of questions and debates at this committee can be much more strategic in nature.

I think witnesses should be interviewed prior to coming here, so that you have a better understanding of what we're about to say, and the questions can be based on more information.

At the ministerial level, we've talked a lot about that. There is absolutely no question in my mind that if you wanted to bring a minister here to be held accountable for defence acquisitions, you could not do that. There is no one minister you can bring here and hold accountable.

Mr. Bland was telling me that he had a research assistant going through the transcripts. Now that I'm out of government, I went through them all myself. That's how I spent my time. It was very clear from your discussions with the ministers that neither one was being held fully accountable.

[The Chair, Conservative, Rick Casson]

We have to move on, as our time is short. I apologize, but keep that thought; we may be able to carry it on.

Mr. Bachand, you have seven minutes.

[Claude Bachand, Bloc, Saint-Jean, QC]

Thank you, Mr. Chair.

I would first like to welcome our friends. I will begin by explaining why the Bloc Québécois really pushed to have this kind of study done.

The government wants to acquire equipment worth some $20 billion. I have always been baffled by the fact that members of Parliament, including those on the defence committee, were completely excluded. This is not an easy situation for parliamentarians. We are dealing with public servants and generals who have been around for some 30 years. We are trying to understand how things work, but we are left with the impression that everything is shrouded in a culture of secrecy. These people form a group. They make their preparations and the further things are kept from parliamentarians, the better. This is why I pushed for this study to be conducted. The culture of secrecy applies to everyone who appears before us as witnesses.

Mr. Williams, you are a changed man. I remember asking you some questions when you were a public servant. You do not have the same attitude. As I said, a culture of secrecy surrounds all of this. We must overcome it. We, as parliamentarians, have the considerable advantage of being those whom the taxpayers entrust to ensure that their tax dollars are spent appropriately.

Furthermore, Mr. Bland, you admit that the Canadian Forces have been neglected for years. However, one cannot build an army simply because one decides to do so. A defence policy must be adopted. The Liberals did so in 2005 and the Conservatives subsequently said that they would likely continue in the same direction. Everyone is now wondering what should be included in that policy and we are all anxiously awaiting the defence capability plan, which we have yet to see. We are in the process of purchasing some $20 billion worth of equipment, but we do not know whether it can be justified in the context of a new defence policy.

We hope to conclude our study by asking ourselves what the best solution would be. You suggested some avenues, Mr. Williams. You talked about the primary role of the Department of National Defence, and Public Works and Government Services. For now, the process is very fragmented. When we ask one minister a question, he tells us to ask the other minister the following week, since it is not his responsibility. When we ask that minister, he tells us that we should have asked the first minister the week before. We are in a rather awkward situation.

Could you please elaborate on the industrial benefits? This is very important to us. As I am sure you are aware, there is currently a debate raging on this. The Bloc Québécois is presenting a motion in the House today. I think the Department of Industry has a role to play. You did not mention this in connection with Defence Procurement Canada, but I imagine you want these people to complete the work of the first two and to ensure that the benefits are properly distributed.

I have raised many questions and will therefore hand over the floor. I am anxious to hear your answers.

[Dr. Douglas Bland]

I'll just say something quickly.

[The Chair, Conservative, Rick Casson]

Go ahead, whoever wants to start.

[Dr. Douglas Bland]

I'll just say three quick things.

With respect, the culture of secrecy, if it exists, seems to me to be contagious as governments change. But that aside, in writings and research and in working with the Somalia inquiry, for instance, during that period, I'm very eager to have a vigilant Parliament in matters of national defence. I think members should inform themselves in these committees and so on, but you can't do it yourself. I have always said, as other people have said, that committees such as this need strong research support, and I would encourage Parliament—or the House of Commons, anyway—to vote themselves money for these kinds of committees.

Secondly, white paper or no white paper, I think it's essential and I think it would be very pleasant if this committee and others like it could come up with a non-partisan defence policy for Canada. I don't actually see much difference between the Liberal statements in earlier years and the Conservative statements now.

But those aside, is the argument that we can't go ahead with procurement of support ships for the navy until we have a white paper, that we can't buy basic things like airplanes, communication systems, and equipment for the north until we have a white paper? I don't know of any responsible statement by any party in Canada saying we don't need these overhead investments, as I call them, so that we can do other things.

Someone could write a white paper statement this afternoon and we would all come to the same conclusion: that there are certain basic military capabilities we need, no matter who is in power, what we're doing and where we're going, and I think that's where we need to work.

[The Chair, Conservative, Rick Casson]

Mr. Williams.

[Alan Williams]

I hope this isn't really a dramatically new me; I like the old me. But you're quite right: when you are in the bureaucracy, you're part of that team. If you disagree internally, once the decisions are made, that's what you reflect as part of the citizen, and I don't think you'd want it any other way.

I have a few points. In terms of money, this isn't a $20-billion problem; this is a $100-billion problem. If you figure on expenditures of $4 billion to $5 billion a year to buy and maintain equipment for 20 years, you're talking $80 billion to $100 billion. That's the amount of oversight, the dollar value you should be looking at. I agree totally with you: I think there is too much secrecy, there isn't enough valued input by this committee overseeing the strategic kinds of discussions and decisions that have to be made. Absolutely. I would agree with Doug.

I'm not sure that you need the fine print in order to decide on some major strategic decisions. Having said that, I think you should be able to have your cake and eat it too. I think you should be able to review a draft of the defence capability plan. I think the defence capability plan should be out. It should be there to debate and discuss as a critical document supporting the government's policy paper, and the linkage between the two is where I think you could have tremendously valuable discussion.

Once you get to that decision, then I think you can have very strategic, timely decisions about how you go about getting those capabilities filled. As Doug Bland said, part of the problem is that delaying the decisions can force you into suboptimal acquisition options, so the earlier you can look at the policy, the earlier you can link the capabilities to those policies, the faster you can get to discussing how you go about doing it and doing it right, which are, of course, the substantive issues my book deals with.

[The Chair, Conservative, Rick Casson]

Thank you very much.

Ms. Black, seven minutes.

[Dawn Black, NDP, New Westminster—Coquitlam, BC]

Thank you, Mr. Chair.

Thank you both for coming today. Welcome back, Mr. Bland. I haven't been here when you've been here in your other role, Mr. Williams, but welcome today also.

It's been a real surprise to me, and it's been articulated already as we've gone through these hearings and had the various ministers and their officials here, that there is not a political person, a minister, who is finally accountable and responsible for the decisions. As one of the other members said on the committee, you would ask one minister a question--I asked one minister a question about his area of responsibility, and he said “That's not me, you'd better ask the other minister”. That's been a real surprise to me as a new person on this committee, the way it ping-pongs back and forth, and that there isn't one final person responsible.

I wanted to ask you why you chose the Minister of National Defence, after having worked through Public Works, why that was your choice.

The other question I had was around the issue of the procurement process. You've been on the inside of the process, but away from it for several months now. What are your views on the decisions that were related to the C-17 and the intention to go ahead, now, with the C-130J Hercules?

I have three or four questions here, and I'll get them all out and hopefully you'll both have time to respond.

The government has put out a plan now for $17 billion in defence procurement. You've made some strong recommendations around the procurement process. Given what Mr. Bland said and others have said, that the need is very pressing, would you think that these purchases should be held up while there's a reform of the process, or should the ones that are in the pipe already go ahead?

I'm also very interested in the issue of search-and-rescue planes, coming from British Columbia and the complex nature of search and rescue there with the mountains and the ocean and all of that. I think it seems to be really delayed, and I'm wondering what you could tell us about that.

The last comment I want to make is that I certainly agree with whoever said that we should get the position papers of witnesses to members of Parliament before the day of the meeting, because it's quite bizarre that you want to have informed discussion and debate at committee, yet you don't know what witnesses are going to say until they appear. When I was a member of Parliament in the early nineties, we did get the position papers ahead of time, and that gave you time to read and ask perhaps more informed questions.

The last comment is about the agreement on internal trade, which I think came out of the CF-18 decisions that were made. Now in this procurement, it's been negated through making a decision that the national security issues prevail. So I would like comments on that as well.

Thank you.

[Alan Williams]

Let me start on a few things in a random order

First of all, in terms of the transcripts, my point is more than transcripts. It's not so much my opening statement and Doug's that I'm thinking of. But given your limited resources, I would expect that one of your researchers would interview witnesses well before, beyond our statement, question and challenge and bring that back to this committee so that you have substantive information upon which to further.... It's not just the opening statements; it's beyond that. That's point number one.

With regard to why the Minister of National Defence, in the book I did present five different.... The agency itself, Defence Procurement Canada, can report to the Minister of National Defence, it can report to the Minister of Public Works, it can report to a third minister, and there are administrative options within that. I chose it for the one reason that I have been talking about all along: I think it's important that one minister is being held accountable. The same minister who's accountable for the statement of requirements would be the Minister of National Defence; otherwise you split it.

You also have a human resource issue, because many of the resources within this organization will be military, and it's a lot easier for human resource management, frankly, to move these military people back and forth between this organization and the army, navy, or air force organization in a more seamless kind of way. This gets to Monsieur Bachand's point a little bit too. In the book I do comment that the deputy minister and myself thought we had an agreement at one point in time with Public Works to try this, but it got snafued. At some point in time you ask how often you are going to bang your head against the wall to make this happen.

This committee, under Pat O'Brien's chairmanship, also made the recommendation that this be looked at, but the government response was no, we don't think we ought to. As a player in the system, once a government makes that decision, that decision is made, and it would be inappropriate for me to challenge it.

There are a lot of procurements in the pipeline right now. The last thing I would suggest we do is hold them up. They warrant appropriate debate and discussion, and I think it's appropriate that we go about doing them the right way. As I said in my comments, the right way doesn't mean a long period of time, and the biggest delays are in getting approval. To give the government full credit, if it said it wants to buy tactical lift, strategic lift, and heavy lift helicopters, that's great. That eliminates one huge obstacle. Once that's done, let's move quickly through the front door, and not try to find a back door to go through. That would take, in my estimation, more time, so I wouldn't delay it.

In terms of fixed-wing search and rescue, this is an interesting case study, because you may recall that in 2004 money was put in the defence budget in the order of $1 billion or $1.3 billion to buy them, with the view that this is something we can do quickly. Here we are three years later, and nothing has been done. One of the major reasons for this is that in developing the requirements it seemed to me there was a tendency to try to make this skewed for one aircraft over the other. Part of the attention of why it didn't go forward is there was some opposition from people like myself and others who felt it's the wrong way of doing things.

One example.... You can say in your requirements something that makes intuitive sense: it has to go a certain speed; it has to go 273 knots an hour. But when you think about it, that doesn't make any sense, because what's important is not how fast it goes, but how long it takes to get wherever you have to go. There's a difference. If you locate your aircraft at different places within the country, you may not need to go as fast in order to get there within the requisite period of time.

And people here have talked about the importance of indicating things in performance terms. That means saying what the aircraft must do, not what it must be. It must be able to save lives within a period of time, as opposed to being able to necessarily be an aircraft that can fly so fast. It's getting the mindset changed to a performance base from a detailed spec base that is a key part of this solution.

I see I'm being waved by the chairman.

[The Chair, Conservative, Rick Casson]

I'm sorry, I will try to move on.

We will wrap up now with Mr. Hiebert for seven minutes.

[Russ Hiebert, Conservative, South Surrey—White Rock—Cloverdale, BC]

Thank you, Mr. Chair.

I'll be splitting my time with my colleague, Mr. Calkins.

Thank you both for being here today. Thank you, Mr. Williams, for your book and the insights that it provides.

[Alan Williams]

I don't get royalties, I want you to know, so this is purely—

[Russ Hiebert, Conservative, South Surrey—White Rock—Cloverdale, BC]

Your number one recommendation is the creation of an organization called Defence Procurement Canada, under the statutory authority of the Minister of National Defence, and you've talked about this currently being under four departments. Do you not think it would be giving too much authority to the Minister of National Defence to put all of those current four ministries under one individual?

[Alan Williams]

That's a great question, and it should be a concern. But this is why you can't look at that option or recommendation in isolation.

This committee has a key role. If you don't hold that minister accountable, if you don't get the information you need to hold that minister's feet to the fire, then it won't work. But the fact is there are other things around it to ensure that holding the minister accountable isn't negated by other problems.

On the other hand, if you do split it, my view is you won't get performance measures. The reason it's hard to get performance measures today is that no one likes to stick their neck out when they cannot be accountable for the whole. “I'm not going to do it if in fact you are part of the system, because maybe you are delaying it.”

If you hold one minister accountable, you can honestly and legitimately demand measures of performance. You can know how money is being spent, why things are proceeding, and where the delays are. So I think that clear accountability overrides everything.

But in order to safeguard, you have to make sure that the other players in the system are doing their oversight roles too—which means this committee in particular doing its legitimate oversight and examining role.

[The Chair, Conservative, Rick Casson]

Mr. Bland has a short comment.