Evidence of meeting #38 for National Defence in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was australian.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Peter Jennings  Executive Director, Australian Strategic Policy Institute

4:20 p.m.

Liberal

Sven Spengemann Liberal Mississauga—Lakeshore, ON

Transferable skills.

4:20 p.m.

Executive Director, Australian Strategic Policy Institute

Peter Jennings

—so we're always going to be struggling.

4:25 p.m.

Liberal

Sven Spengemann Liberal Mississauga—Lakeshore, ON

Mr. Chair, I have one more question, but I'll wait for the next round, given that my time's almost up.

4:25 p.m.

Liberal

The Chair Liberal Stephen Fuhr

We'll go to five-minute questions now.

Mr. Robillard is next.

February 14th, 2017 / 4:25 p.m.

Liberal

Yves Robillard Liberal Marc-Aurèle-Fortin, QC

Thank you, Mr. Chair.

Thank you for your testimony, Mr. Jennings.

Industry and academic experts who have appeared before the committee have stated that there are too many federal departments involved in the defence procurement process. In their view, this makes it difficult to establish a clear and direct chain of responsibility through government and the departments.

What do you think of the multi-departmental process in defence procurement in Canada? What in your opinion are its successes and failures?

4:25 p.m.

Executive Director, Australian Strategic Policy Institute

Peter Jennings

Mr. Robillard, I'm hesitant to buy into the Canadian debate, because I'm seriously not familiar enough to really understand the details and finer points about it. Let me answer your question by talking quickly about the Australian context.

We have had success where there has been clarity of responsibility for projects. That operates at a number of levels.

One is for the project itself, and the consortium of industries that will come together to produce the full capability, the platform, the weapons, the sensors, and so forth.

Second is responsibility within the defence department. There, there have been some quite significant changes to pull separate organizations back together into one organization and specifically clarify those lines of responsibility.

The third thing is responsibility at the government level and ministerial responsibility, which in our system are ultimately exercised through the national security committee of cabinet. Less is better, in terms of what's required.

Certainly my observation, having been a career public servant, is that the more entities you have playing the game, the slower the decision-making process. You end up playing interdepartmental football rather than focusing on the need to have sharply defined objectives.

4:25 p.m.

Liberal

Yves Robillard Liberal Marc-Aurèle-Fortin, QC

Thank you, sir.

I will share my time with Ms. Alleslev, please.

4:25 p.m.

Liberal

Leona Alleslev Liberal Aurora—Oak Ridges—Richmond Hill, ON

Thank you very much.

I would like to take that one step further. I understand that the Capability Acquisition and Sustainment Group was started in 2015. I'm interested in knowing what three key challenges that move was made to address.

4:25 p.m.

Executive Director, Australian Strategic Policy Institute

Peter Jennings

It has a prehistory, of course. The group was the Defence Materiel Organisation before that.

There are three key challenges, I think. One is the continued need for upskilling of the workforce within the group. We now have an organization of several thousand people who are responsible for multi-billion-dollar contracts, so the shipbuilding contracts that I described—

4:25 p.m.

Liberal

Leona Alleslev Liberal Aurora—Oak Ridges—Richmond Hill, ON

The whole budget is something like $12 billion. Is that about right?

4:25 p.m.

Executive Director, Australian Strategic Policy Institute

Peter Jennings

No, our defence budget is now in the order of—

4:25 p.m.

Liberal

Leona Alleslev Liberal Aurora—Oak Ridges—Richmond Hill, ON

No, but for the Capability Acquisition and Sustainment Group.

4:25 p.m.

Executive Director, Australian Strategic Policy Institute

Peter Jennings

Yes, that's this year, but if you look at the shipbuilding package I described, it's $91 billion. The last defence white paper announced $261 billion worth of new capability acquisition. With a billion dollars here and a billion dollars there, pretty soon you're talking big money. I think that managing the skill base that's necessary for project management is one of the key challenges the group faces.

The next one is actually getting the decisions put through cabinet. In any one year, we need to take around 40 decisions to the national security committee of cabinet in order to be able to spend our budget. When I say “we”, I mean the defence organization. That is an enormously difficult challenge. It's a high workload for cabinet. It forces that football game I mentioned to think hard about when you slow decisions down. I think a critical vulnerability for our system going forward is whether we can get government to make the decisions fast enough to spend the budget.

The third issue would be the technical risk associated with some of these integration challenges I've mentioned. For example, just to pick one, the submarine design that we selected is based on a nuclear-powered submarine, but our current policy says we will have a conventional drive system, so there are some quite tricky design challenges associated with taking a nuclear design and turning it into a conventional drive. Can we do that, and can we do it in the time frame that lets government make the decisions it wants to make? It's very difficult.

4:30 p.m.

Liberal

Leona Alleslev Liberal Aurora—Oak Ridges—Richmond Hill, ON

Thank you.

4:30 p.m.

Liberal

The Chair Liberal Stephen Fuhr

Mr. Bezan is next.

4:30 p.m.

Conservative

James Bezan Conservative Selkirk—Interlake—Eastman, MB

Thank you, Mr. Chair.

Mr. Jennings, it's great to have you at committee. I think Canada and Australia have had very similar types of histories. We've stood shoulder to shoulder in many conflicts going right back to the Boer War, and right now today in Iraq. We do lean on each other for best practices and for how we can get better, and we look at what you're doing. I do appreciate you coming and sharing the information you have.

I agree with you that there is a need to expand upon what we do through the Five Eyes now. What we can do through Canada, Australia, New Zealand, the U.K., and the United States, I think, only enhances our national security interests and our collective security as global partners.

Like Ms. Alleslev, I want to dig more into how you were able to come together under a defence industry minister as somebody taking the lead in making sure the procurement works and getting the politics out of the way, although you're facing some of the challenges that we are with our own shipbuilding strategy and delivering projects on time and on budget. Can you talk to that political window of how they were able to all come together? Was it just bipartisan, or were Labor, National, and Liberal all able to come together, and do the Greens support it? Were you able to get everybody on side, or just the main governing bodies?

4:30 p.m.

Executive Director, Australian Strategic Policy Institute

Peter Jennings

Probably not the Greens, because they would not want to see this investment into these particular capabilities.

Look, I think there was strong common ground for the major centre-left parties and centre-right parties to accept the idea that defence industry policy did need to be seen as a subset of broader Australian government attempts to grow the economy and grow jobs in the economy. It wasn't much of a fight to get the parties to sign up to that. There's still an enormous—and appropriately so—amount of political fight over particular issues relating to contracts and those sorts of things, and that's a healthy function of the system. However, it is very useful to have that broad sense that now we can put the debate over offshore versus onshore behind us, and I really hope we stick with that for the time being.

On the defence industry minister, it is a useful thing for the committee to consider. I think that the government came to that view partly as a workload function between what the minister of defence and the industry minister could do and partly in the realization that the acquisition program set out in our last defence white paper is the biggest risk. It's the one thing that needs the government's closest attention, and it's also some of the biggest expenditure that this or any other Australian government will ever undertake.

Was that worth a cabinet minister's position? I think it was, and I think the government came to that view.

4:30 p.m.

Conservative

James Bezan Conservative Selkirk—Interlake—Eastman, MB

You, as a country, made a decision to keep your destroyers. You're building the first of your Hobart-class destroyers, and I guess you're looking at the risk factors of the proliferation of all the hypersonic cruise missiles that are out there.

Are your destroyers in the traditional sense, or have they a lot more new technology? Are they maybe not as big as previously, but ships that still have all of the capabilities and then some of a traditional destroyer?

4:35 p.m.

Executive Director, Australian Strategic Policy Institute

Peter Jennings

It is a very capable ship, and it is biased toward air defence. Its most capable weapons system is a missile box launcher at the front of the vessel, which is designed to be able to shoot down a range of aircraft and missile systems. It has an upgrade capability, should the government wish in the future to give it an anti-ballistic missile defence capability as well.

4:35 p.m.

Conservative

James Bezan Conservative Selkirk—Interlake—Eastman, MB

Then the hull is a lot bigger than what you're doing with your frigates.

4:35 p.m.

Executive Director, Australian Strategic Policy Institute

Peter Jennings

Yes, it is. Well, actually, that's not quite right. It potentially could be the same hull, because one of the bidders for the new frigates has been the constructor of the air warfare destroyer, which was based on the Spanish F100 design,

Again, the hull is less relevant than the weapons systems that are inside. You can think of this as a ship that could operate very effectively as part of an allied component. If we found ourselves doing something off North Korea with the U.S. and Japan and perhaps yourselves, that ability to operate as part of an allied fleet would be important, creating a screen of protection around a number of vessels doing different tasks.

4:35 p.m.

Liberal

The Chair Liberal Stephen Fuhr

That's your time. Thanks very much.

Go ahead, Mr. Fisher.

4:35 p.m.

Liberal

Darren Fisher Liberal Dartmouth—Cole Harbour, NS

Thank you very much, Mr. Chair.

Thank you very much, Mr. Jennings, for being here and sharing your perspective.

It's probably no surprise that I'm going to speak about the GDP and the commitments we have both made to come toward 2%. My belief is that in some countries it's kind of apples and oranges. I'm interested in Australia. The U.S. includes the Coast Guard in its budget, but Canada doesn't. Do you include the coast guard in your budget, and do you arm your coast guard?

4:35 p.m.

Executive Director, Australian Strategic Policy Institute

Peter Jennings

We have solved that problem by choosing not to have one, Mr. Fisher.

The navy undertakes most of the traditional functions associated with a coast guard. There is also a much smaller level of patrol boat capability that is maintained by the navy as well, which I haven't actually discussed this evening.

That said, we do have an increasingly capable border force, which is part of our immigration and border protection department, which is—

4:35 p.m.

Liberal

Darren Fisher Liberal Dartmouth—Cole Harbour, NS

You have no border, though.