National Defence Committee on March 9th, 2017

[The Chair, Liberal, Stephen Fuhr]

Thank you for appearing today.

I would like to thank the minister, department officials, and department staff for coming today to talk about supplementary (C)s.

I understand there will be opening remarks. There will be questions.

I realize your time is limited, Minister, so the time allotted for questions and answers is limited and specific. We will try to make sure that everyone gets a chance to participate.

Minister, thank you for coming. The floor is yours.

[Harjit S. Sajjan, Liberal, Minister of National Defence]

Thank you, Mr. Chair.

I'm pleased to be here again to discuss the Department of National Defence supplementary estimates (C). The estimates I will speak to this afternoon represent core requirements for National Defence.

The funding our department is requesting will contribute directly to the operational effectiveness of our military. This will help Canada achieve success both at home and abroad. The department has requested additional funding of approximately $29 million in these estimates. This represents a fraction of our overall estimated spending of $18.8 billion in this fiscal year.

The requests we have made in these supplementary estimates will serve three important purposes in pursuit of the government agenda: first, our commitment to actively contribute to peace and security in the world; second, our commitment to building a strong, modern, and ethnically diverse force through a targeted recruitment; and third, our commitment to good stewardship of resources.

On the first point, our engagement in the world, the largest part of today's requests pertains to Operation Reassurance. This operation relates to NATO assurance and deterrence measures in central and eastern Europe. Canada is a strong and proud partner in the alliance. We stand ready to deploy military personnel and equipment in support of our allies when and where they are needed.

These estimates reflect already-announced changes in our approach to these measures. Canada will assume a leadership role as one of four framework nations as part of NATO's enhanced forward presence. We will be responsible for establishing a leading multinational NATO battle group in Latvia. This demonstrates the high level of trust that allies have for us in Canada. It is also a clear demonstration of Canadian leadership on the international stage and the value of our women and men in uniform.

The additional funding requested for Operation Reassurance will ensure that our military is able to meet its defence commitments around the world.

We are also requesting approximately $2.6 million for the important work that the Communications Security Establishment is doing to address the crisis in Iraq and Syria.

I will turn your attention now to the second topic, recruitment. The most valuable and effective asset in the Canadian Armed Forces' arsenal is its people. We need to continue attracting the best and brightest Canada has to offer into the ranks of our military if we are going to succeed. That requires a concerted recruitment effort including advertising to attract motivated, talented, and qualified women and men to make up today's armed forces. We are requesting an additional $1 million to help build that force through targeted recruiting. In fact, recruitment is the only reason National Defence advertises. We also know how important it is to draw from the entire breadth and depth of Canadian talent.

I would now like to address our third request, which is about good stewardship and giving our women and men in uniform the tools they need. Specifically, we are requesting that roughly $19,000 from the sale of National Defence property be reinvested in an explosive ordnance disposal facility at CFB Gagetown. By reinvesting money from our other revenues, we will ensure that reinvestments in needed facilities like this have no impact on the public purse.

Finally, I would like to talk about transfers. As part of these estimates, National Defence will be receiving $2.8 million in transfers from other departments. An example of this is a $713,000 transfer from Public Services and Procurement Canada. This will help improve contracting and procurement and make it more efficient. Another transfer comes from Global Affairs Canada and totals $91,000 to support defence and security work at missions abroad.

DND will also be transferring funds to other government departments, $3.4 million in fact. This includes $403,000 to the National Sciences and Engineering Research Council of Canada to support joint research grant projects. We will also direct $1.9 million to Global Affairs Canada for a command centre project in Guatemala.

These are some of the many projects that make up the overall budgetary picture of DND.

In short, Mr. Chair, it all comes down to one thing, solid financial stewardship. The Department of National Defence is committed to maximizing value for Canadian tax dollars.

We are committed to ensuring that the money we manage has a positive impact on our most important asset, which is our people. As we move toward a new fiscal year, we continue to build on the government's priorities. We do this while operating within a whole-of-government framework and a complex fiscal environment.

Thank you for giving me the opportunity today to demonstrate how DND is advancing the government's agenda. I will take your questions.

[The Chair, Liberal, Stephen Fuhr]

Thank you, Minister.

Our first seven-minute question will go to Ms. Alleslev.

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

Thank you, Minister. It is always a pleasure to be in your presence. I'm wondering if we could talk a bit about the money going to the Communications Security Establishment. After 70 years, there's no question that we've come a long way from cryptology, and we've just heard significantly from NATO, when some of the members of the defence committee had an opportunity to be in Brussels, and then this past week in Washington, that cybersecurity is definitely one of the significant areas that we need to be focused on.

We're wondering if Iraq and Syria and the money we're going to be putting into this particular aspect is going to give us an additional capability and framework to further that conversation on cybersecurity and our critical role in it.

[Harjit S. Sajjan, Liberal, Vancouver South, BC]

I'll explain some of the work they do and where this investment goes, and I'll open it up to the DM and to Dom to give some of the details of that work, and I'll also speak from my own experience.

I can assure you, when it comes to intelligence, that intelligence is not just strictly about the military. What we bring, as Canada, to the table is our ability to bring other departments and agencies together and build a much wider picture. CSE plays an absolutely critical role. It's not understood a lot, obviously, for good security reasons, but it provides a phenomenal role as part of that intel fusion.

I'll just turn it over to Dom to explain the details there.

[Dominic Rochon, Deputy Chief, Policy and Communications, Communications Security Establishment]

In terms of the $2.9 million specifically related to these estimates, they're mainly focused more on intelligence capabilities, collection of intelligence to be able to support our troops in theatre. That intelligence contributes to security against cyber-threats, but more specifically in this particular instance, that's not the case. The money specifically in these estimates is not related to what I would refer to as part B of our mandate in terms of thwarting cyber-threats. We actually have that activity, and that activity works hand in hand with regard to our foreign signals intelligence. Our foreign signals intelligence collection does inform better cyber-defence, but in this case the money specifically is going toward part A of our mandate, which is foreign signals intelligence.

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

Will it inform us on our policies going forward and help us to evolve the doctrine because of the approach we're able to use in this conflict area?

[Harjit S. Sajjan, Liberal, Vancouver South, BC]

I can answer for the policy side of the questions. It's not just informing in terms of policies, but in terms of how we operate in a complex anti-intelligence environment. I can say that Canada really sets the example. Other nations look to us. It's not just about creating better policies and how we can share some of our policy experience, but also in terms of the strategies as well. Hence, one of the reasons why we did this is that one of the first requests I got when I visited Iraq was intelligence. I knew exactly what our allies were looking for. It was that fusion ability. I also want to stress how important CSE's work is for the force protection of our people.

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

That's fantastic. Thank you.

I'll go now to procurement because I know you're looking for some transfers from PWGSC so that we can have an increased delegation of authority, so that DND will be able to take a greater responsibility around procurement authorizations and the like. Can you share with us some of what that means, why this is important, and how it's going to help in streamlining our defence procurement process?

[Harjit S. Sajjan, Liberal, Vancouver South, BC]

I'll let the DM get into the details of this, but the delegated authority will eventually allow National Defence to buy supplies up to $5 million in a competitive manner, pending approval by Treasury Board, of course, and this will be exercised in a phased approach. To implement this, National Defence and PSPC agreed to transfer resources to cover the increased workload that it will represent for National Defence.

I'll let the DM get into the specific details of this.

[John Forster, Deputy Minister, Department of National Defence]

We're approaching this in a couple of phases. The first phase was the transfer to us of up to $400,000. We'll put in place systems and processes. We eventually hope to move that, then, to $1 million and then to $5 million. When we've done this process, 80% of the defence procurement, the lower-value regular stuff, will be done by Defence, and Public Services will do the higher-value, higher-risk stuff. We hope that'll speed things up and improve efficiency.

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

Will you have a performance measurement framework in place to measure the success of the performance over the time of procurement?

[John Forster]

Yes. We're going to want to track how well we're doing. The whole goal of this process is to move things faster. We're taking care of the lower-value, more numerous procurements. We want to try to do them quicker.

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

Can you give us a feel for what percentage of all DND procurement that represents?

[John Forster]

We're doing it in three phases, so that we're well prepared and have the processes in place. When we get up to the final stage, about 80% of the defence procurement will be done by us and Public Services will do the rest, including the higher-value, larger projects, like fighter jets, ships, and that sort of thing.

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

Do you foresee a time where you might want to assume more responsibility over that procurement process?

[John Forster]

We'll take it in these three bites and then we'll see where we go from there.

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

Thank you.

I have no further questions.

[The Chair, Liberal, Stephen Fuhr]

Ms. Gallant, you have the floor.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Thank you, Mr. Chairman.

In the supplementary estimates (C), it says that National Defence is receiving an additional charge for IT services from Shared Services Canada. Why is your department being financially penalized for program cost overruns that your department has no control over?

[Harjit S. Sajjan, Liberal, Vancouver South, BC]

I don't think that it's being penalized.

Do you want to take that?

[John Forster]

Actually, we're transferring money to Shared Services to support our Canadian defence attachés overseas. It gives them money to put the IT equipment in and provide the IT support for our personnel overseas. That would be the $12,000 that we're transferring, if that's the one you're asking about.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

I'm asking about the $100 million to $249 million for the Phoenix system. Why is there such a big spread?

[John Forster]

Sorry. I'm unclear....

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

The Guardian system.