Evidence of meeting #27 for National Defence in the 40th Parliament, 3rd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was competition.
A recording is available from Parliament.
4:45 p.m.
Conservative
Laurie Hawn Conservative Edmonton Centre, AB
We can't compete the MOU, with the cost reductions and the access to information that we have as a member of the MOU.... We can't compete with that because that's not a level playing field.
4:45 p.m.
former Assistant Deputy Minister (Materiel), Department of National Defence, As an Individual
You can compete the marketplace against the MOU, absolutely.
4:45 p.m.
Conservative
Laurie Hawn Conservative Edmonton Centre, AB
Is that a level playing field? Would that be fair to Boeing?
4:45 p.m.
former Assistant Deputy Minister (Materiel), Department of National Defence, As an Individual
Why wouldn't it?
4:45 p.m.
Conservative
Laurie Hawn Conservative Edmonton Centre, AB
Because we have a cost advantage of 8% by being in the MOU. We have access to information that we wouldn't have outside of the MOU. So it's not a level playing field. In fact it would be unfair to Boeing.
4:45 p.m.
former Assistant Deputy Minister (Materiel), Department of National Defence, As an Individual
It would not at all. In fact I would argue that Boeing has an advantage. Boeing already knows the costs of this. All they would have to do, assuming they could meet their requirements, is lower their price and they'd win.
4:45 p.m.
former Assistant Deputy Minister (Materiel), Department of National Defence, As an Individual
Well?
October 7th, 2010 / 4:45 p.m.
Conservative
4:50 p.m.
former Assistant Deputy Minister (Materiel), Department of National Defence, As an Individual
Why not? In a competition, all the players sharpen their pencils to give us the best deal. That's why you compete.
4:50 p.m.
Conservative
Laurie Hawn Conservative Edmonton Centre, AB
I'm going to get into the fifth-generation capabilities in a minute, but if you go into a competition knowing what the results of the competition will be because one airplane is so much better than the other because of the fifth-generation capabilities, the outcome of the competition is probably preordained.
4:50 p.m.
former Assistant Deputy Minister (Materiel), Department of National Defence, As an Individual
That argument makes absolutely no logical sense.
4:50 p.m.
Conservative
Laurie Hawn Conservative Edmonton Centre, AB
Can you tell me the advantages of fifth-generation technology in fighter aircraft?
4:50 p.m.
former Assistant Deputy Minister (Materiel), Department of National Defence, As an Individual
I know very little about that, other than what everybody else knows about stealth and lethality and those kinds of issues.
Having said that, that's not my job. I'm not second-guessing the need for fifth-generation. I just want it to be publicly shown why that requirement, as well as every other one, is necessary.
4:50 p.m.
Conservative
Laurie Hawn Conservative Edmonton Centre, AB
So you're not aware--and there's no reason you should be--of the differences between fifth-generation and fourth-generation?
4:50 p.m.
former Assistant Deputy Minister (Materiel), Department of National Defence, As an Individual
No, I am. I didn't say I wasn't.
You are going back and forth. First you were saying if I could run a competition and they could meet the requirements, they would be disadvantaged. I'm saying no. If a competition were held and they could meet the requirements, they would have a cost advantage because they know what Lockheed Martin's aircraft is going to be.
You are now saying maybe they can't meet the requirement. I'm saying the proof is for us to see the statement of requirements and understand why the fifth-generation is required in the role and then let's see what other industries and companies have to say about that. That's all I'm saying.
4:50 p.m.
Conservative
Laurie Hawn Conservative Edmonton Centre, AB
If the requirement is for a fifth-generation aircraft to be interoperable with our allies in all those countries and there is only one fifth-generation aircraft available and the requirement is for a fifth-generation aircraft, then the competition is done.
4:50 p.m.
former Assistant Deputy Minister (Materiel), Department of National Defence, As an Individual
Look, I've seen this many times. You can always take any program and say if this, then that excludes all other competition. I've seen it in many cases. The issue is why do you have to have this “if”? What happens if you don't have this “if”? Then what's wrong with that? Can you prove to me that you need this “if”? That's all I'm saying.
There is no reason for people to be afraid or reticent about seeing exactly why we are saying what we're saying.
4:50 p.m.
Conservative
4:50 p.m.
Liberal
Geoff Regan Liberal Halifax West, NS
Thank you.
I guess what you're saying is that as opposed to this question of starting off by saying there's a fifth-generation aircraft and therefore we have to have it, we ought to be asking what our requirements are and how we can meet them. Is that what you're saying?
4:50 p.m.
former Assistant Deputy Minister (Materiel), Department of National Defence, As an Individual
That's right. And to follow up on Mr. Dryden's and Mr. Bachand's comments, you put the role of the military at the top. That's the basis of everything. What is the role that we see for our men and women in the future? How does our air force play into that? How do these jets play into that? Then you can determine, based on that, the requirements you see.
I have no idea why we are so afraid of making that public and justifying our requirements. It boggles my mind.
4:50 p.m.
Liberal
Geoff Regan Liberal Halifax West, NS
So if one of our top priorities were protecting our northern airspace, for example, from incursion by 30-year-old or 40-year-old Russian bombers with propellers that apparently don't actually come into our airspace but come somewhere near it--and the government gets quite upset about that--then wouldn't speed be more important and wouldn't it be more important...? The F-18s we have currently are in fact, as I understand it, faster than these proposed JSF fighters, according to the specifications.
4:50 p.m.
former Assistant Deputy Minister (Materiel), Department of National Defence, As an Individual
I'm not going to make the same mistake that I'm counselling people not to make. I don't want to pre-judge one requirement or make judgments about the requirements. I've always left that to the military. What I always did, though, was try to make sure that they can be justified in light of the roles they have to play. So I'd prefer to leave it like that.
4:50 p.m.
Liberal
Geoff Regan Liberal Halifax West, NS
When Mr. Hawn says that Boeing can't lower their price, would you agree that if this goes ahead as planned, we will never know the answer to that question because there is no competition?
4:50 p.m.
former Assistant Deputy Minister (Materiel), Department of National Defence, As an Individual
That's right. The whole point of a competition, the reason you go from one car dealership to another, is in order to try to play one against the other. When you go into these things you never know who's going to win.
I've always found that there is always one company, more than any other, that really wants the $16 billion, $15 billion, or $20 billion contract and they will provide the best technical bid and they will also have, by far, the lowest price. And you never know until you test the marketplace. This is a huge contract, and people are going to grasp at it if you give them a chance.
