Thank you very much.
It's a great honour to be here. My comments are directed at all the members, but especially to the members of the new government, because you have some very difficult decisions to make.
I'm going to start by providing just a bit of context. Let me preface this by saying that I think you will have to recommend to substantially increase Canada's defence budget. We are currently drifting below 1% of GDP. I suspect that you will need to increase that to at least 1.5% and perhaps even 2% of GDP. This has an impact on the issues that you are discussing in this committee.
Just to flesh that out with a bit of context, the Canadian navy is in serious trouble. It has no supply ships. It has no air defence destroyers. Its marine coastal patrol vessels have been deemed unworthy of a mid-life refit. The submarines are close to 30 years old and have spent most of their lives in refit and maintenance. On the navy, I could go on.
The army is in serious trouble. The fleet of armoured trucks is for the most part undeployable and seriously in need of replacement. For example, if you are thinking about engaging in United Nations peacekeeping on any scale, you'll need to replace those trucks first.
The air force is in trouble. Canada's search and rescue fixed-wing planes are approaching half a century in age. Our fighter-jet fleet is 30 years old. There are serious concerns about metal fatigue. We have only 14 long-range search and research helicopters. In this, the second-largest country on earth, the Canadian Forces, the Royal Canadian Air Force, is on record as saying that they need at least 18 to do the job properly.
Again, I could go on. The north warning system needs to be upgraded.
This is all core context, because it amounts to tens of billions of dollars that you will need to spend.
Let's talk about the situation with regard to air warning and defence in the north. I want to deal first with the issue that has come before this committee in the past year or so, that of drones for Arctic surveillance.
The good news here is that the Canadian Forces and the Canadian government more generally are actually pretty well equipped right now in terms of Arctic surveillance. We have RADARSAT-2, which is the world's best synthetic aperture radar satellite built for the Arctic. We have funding committed for the first three satellites in the RADARSAT Constellation. You should think hard about increasing that to the proposed six.
We have the northern watch system, which is highly functional but needs to be upgraded in the next 5 to 10 years. We have the Aurora maritime patrol aircraft, 14 of which are going through a major refit process. There are four more for which the parts for the refits have been acquired. I would recommend that you refit all 18. They provide an excellent surveillance capacity. Transport Canada has two Dash 8s, and one Dash 7. They overfly every foreign vessel visiting Canada's Arctic.
There are other capabilities. There are RCMP officers in every single northern community. That's surveillance.
Do we actually need drones for the Arctic? Well, on my priority list of spending, they simply wouldn't be there. I would like to gently suggest that the reason they have been put forward in the context of the Arctic is that the previous government twice denied a request from the Canadian Forces to acquire drones for use in armed conflicts overseas. They didn't get it for those, and the Arctic may have been an additional argument that was introduced. Be careful about this.
In terms of fighter aircraft, I've already mentioned that the CF-18s are getting very old. They desperately need to be replaced. They need to be replaced within a reasonable budget, and the planes that replace them need to be not just capable of Arctic operations but suited for Arctic operations. Be very careful about costs here. Some of these planes are proven and have set costs. One of the planes that could be under consideration is not yet proven, is not yet complete, and has uncertain costs. Then you have other factors that come into play, like changes in the exchange rate between Canada and the United States.
The acquisition budget for the F-35s of $9 billion for 65 planes was set at an exchange rate of 92¢ on the U.S. dollar. At today's exchange rate, at 77¢ to the dollar, you can only buy 56 F-35s, so consider whether or not your government, within a set budget and a minimum number of planes, is going to be able to acquire some of the aircraft under consideration. That should be part of the actual statement of requirement, a minimum number of planes for the set budget.
Another issue concerning the F-35 that I just want to flag is the single engine. I know you've heard testimony on this, and you've been told that fighter jet aircraft engines are becoming progressively more reliable. That indeed is true, but twin engine jets are still more reliable than single engine jets. I would refer you simply to the U.S. Air Force safety center website, which actually has charts that show the reliability of different engines and different planes. The single engine planes like the F-16 are getting more reliable, but they are still not approaching the reliability of comparable twin engine planes.
I heard a very strange comment from one of your previous witnesses who was citing the fact that because trans-ocean civilian airlines are moving from four engine to two engine planes, somehow that makes the F-35 appropriate for the Arctic. I don't think anyone in this room would want to fly from Ottawa to London, England, on a single engine civilian aircraft.
I looked at the safety record of the Boeing 777, the world's safest twin engine civilian aircraft, and somewhere in the world, at least once a month—once a month—a Boeing 777 loses an engine. We never hear about it because they have a second engine that they can fly and land safely with, but be very careful about this.
Finally, on missile defence, I have heard previous witnesses being asked in this committee about the possible costs of Canada joining missile defence. There are actually numbers on this. We know how much the U.S. government has spent on its midcourse interceptor system here in North America: $40 billion U.S. We know how much they are spending per year to maintain and grow that system: $1 billion U.S.
You might imagine, and perhaps you might want to ask, whether the United States will let Canada join for free. I doubt it. If we say that perhaps they would want us to pay our share of the retrospective costs of building up the system, the Canadian population is one-tenth that of the United States, so that's $4 billion. If they say that they want us to pay one-tenth of the ongoing annual cost, that is $100 million. You can ask them, but it needs to be factored in, in terms of considering all of these different priorities, as do the risks that are being addressed. If you assume that North Korea is somewhat rational, and it has a choice between sending an intercontinental ballistic missile toward Canada or the United States that draws a bright red line back to North Korea and invites almost certain retaliation, it has a choice between doing that and putting its nuclear warhead on a small private yacht and sailing it into Seattle, Los Angeles, or Vancouver Harbour.
Again, I'm not saying that you shouldn't take risks seriously; I'm just saying that you need to consider costs, you need to consider the degree of risk, and you need to actually consider whether or not the money that is being asked for by some other experts, which they're asking you to spend, actually has gone through a careful risk analysis.
In my analysis, we're good on surveillance in the Arctic right now and we'll be so for the next 20 years. There's no need for drones. We do need long-range fighter aircraft for the Arctic, but they need to be twin engine planes and they need to fit within a reasonable budget. We don't need to join U.S. missile defence because the threat, relatively speaking, does not top out on that priority list, and the cost of joining is likely to be prohibitively high in a very stressed budget situation where you are already going to have to significantly raise Canadian defence spending.
Thank you very much.