National Defence Committee on Nov. 21st, 2024

[Marcus Powlowski, Liberal, Thunder Bay—Rainy River, ON]

The minister was asked by Madame Normandin about 155-millimetre ammunition. Certainly the Ukrainians have been running short of that. The minister said that right now we're producing 5,000 rounds per month. Is that going to the Ukrainians?

[Nancy Tremblay, Assistant Deputy Minister, Materiel, Department of National Defence]

What I can say is that Canada has been donating a lot of equipment to Ukraine, including ammunition. So far, there have been more than 20,000 rounds of 155-millimetre ammunition provided to Ukraine.

[Marcus Powlowski, Liberal, Thunder Bay—Rainy River, ON]

What are our plans? Although it's great to be able to shoot off a few rounds ourselves and make sure we can do it, the Ukrainians need them. I don't think the Canadian Army is in desperate need of shooting anybody with 150-millimetre rounds.

Why aren't we giving those to Ukraine?

[LGen Stephen Kelsey]

We always want to do more for Ukraine, but I would counter the argument. To achieve a level of readiness of our forces, we need to constantly practice the competencies of indirect fire. We need the ammunition, regular and reserve, to maintain a level of readiness, so it's a balance.

[Marcus Powlowski, Liberal, Thunder Bay—Rainy River, ON]

As we ramp up—because the minister has said that we want to produce 12,000 rounds per month—is more of that new production going to be going to the Ukrainian forces?

[The Chair, Liberal, John McKay]

Thank you, Mr. Powlowski. Your six minutes has expired.

Ms. Normandin, you have six minutes.

[Christine Normandin, Bloc, Saint-Jean, QC]

Thank you, Mr. Chair.

I have one last set of questions.

My first question is about the 155‑millimetre artillery shells.

There are two things I'd like to know about the manufacturer study that was commissioned in March.

One, has the study been completed?

Two, did the study focus on increasing production of M107 shells or M795 shells?

[Nancy Tremblay]

The study has begun and is in progress. It is focused on the 795‑millimetre variant.

[Christine Normandin, Bloc, Saint-Jean, QC]

Thank you.

In July, at the NATO summit in Washington, the Prime Minister announced that Canada would increase defence spending to meet the 2% target by 2032. I would like to know when the department was made aware of the announcement.

What impact did that increase have on these supplementary estimates? Are you in a position to turn on the spending taps between now and 2032, instead of in the long term?

[Stefanie Beck]

Thank you for your question.

We had been planning and preparing documents for months. We were delighted at the public announcement regarding the increase to 2%.

Now, from an implementation standpoint, we need to figure out how much we can spend annually between now and 2032. Yes, we do have a plan for that too, but we can't spend anything until we have the money in hand, until the supplementary estimates are approved. Right now, we are still in planning mode.

[Caroline Xavier]

If I may, Mr. Chair, I would add that the votes for the CSE have been allocated for this fiscal year, if Parliament passes supplementary estimates (B).

[Christine Normandin, Bloc, Saint-Jean, QC]

I want to make sure I understand something.

The updated defence policy came out in April or May. In it, the government projected an increase in defence spending to reach 1.76%. When that was announced, the government was already working on a plan to increase spending to 2%, as announced in July.

Do I have that right?

[Stefanie Beck]

We are always very optimistic, so we plan accordingly.

[Christine Normandin, Bloc, Saint-Jean, QC]

Thank you.

I have a question specifically for you, Ms. Beck.

The last time you appeared before the committee, we asked you about a defence industry policy. You seemed to be in favour of the idea. Most of our witnesses tend to be in favour of establishing a defence industry policy. The minister is as well.

Everyone is in favour of it, but it doesn't seem as though anything is actually being done to make it happen.

I'd like to hear your thoughts on the subject. What concrete steps can be taken to establish a real defence industry policy?

[Stefanie Beck]

Certainly, nothing has been drafted yet because we have to consult with industry, as well as our allies. The Americans, the Australians and the European Union have recently come out with their own strategies.

Whenever we meet with industry stakeholders, we ask them about this. We also discuss it with our colleagues in other departments.

Certainly, it would be Industry, Science and Economic Development, and PSPC as well.

It's a triumvirate, if you will. We try to identify the challenges we are facing, while looking for solutions in partnership with industry.

[Christine Normandin, Bloc, Saint-Jean, QC]

Indeed, financial decisions usually involve not just the Department of National Defence, or DND, but also Public Services and Procurement Canada, or PSPC, as well as Innovation, Science and Economic Development Canada, or ISED. Several parties have a say, which tends to slow down procurement of new technology, among other things.

Does the will exist to create a more effective, centralized decision-making process, rather than always having three departments each do their own vetting?

[Stefanie Beck]

A few years ago, the decision was made to involve a number of departments to ensure that the money was being well spent. There are always ways to find a balance. For instance, during the last process, to procure the P‑8 aircraft, it was clear from our standpoint what the Royal Canadian Air Force's needs were.

PSPC focused on what the best way to purchase or procure the aircraft was. ISED looked at how to maximize the benefit for Canadian industry. Each department applied its own lens, and we ended up with a solution that suited us perfectly.

[Christine Normandin, Bloc, Saint-Jean, QC]

I'm almost out of time, but I have another question for you.

Should risk tolerance be built into an industry policy? Is that the key to any future policy? Public servants are reluctant to make decisions that could draw criticism.

[Stefanie Beck]

In developing the strategy, we want to be very clear about the risks. We want everyone involved to be fully aware of the risks when the decision is made. We don't worry only about ourselves.

[The Chair, Liberal, John McKay]

Thank you.

Ms. Mathyssen, you have six minutes.

[Lindsay Mathyssen, NDP, London—Fanshawe, ON]

Thank you, Mr. Chair.

Building from that last conversation, this industrial policy, it seems a bit as though in your response you were talking about going to the industries in general and having these conversations, yet it's the government that must take the lead.

Part of the leadership that's required is, of course, ensuring that we have “made by Canadians for Canadians” involvement in that. I have a bill that would require Canadian investment in that production for Canadians, by Canadians, with good unionized jobs. A perfect example of that is in my own riding, where the Canadian light armoured fleet is being made. Many have spoken to me about the protection of that, and it's good to see. We could do further investments in terms of water bomber fleets made in this very country, which we're not doing, to combat climate disasters, and further investment in Canada's shipyards.

Is there in the works a far more domestic procurement strategy, as opposed to what we're seeing in terms of the quite elaborate buying of American industrial solutions?

[Stefanie Beck]

I think that's a really important goal of this defence industrial strategy—to demonstrate what kinds of products can be made efficiently, cost-effectively, here in Canada, and particularly where we have areas of expertise that we want to encourage and grow, especially from a developmental perspective.

There will be times when the equipment that makes sense for us to buy is not made in Canada. Those are the ones where we want to try to make sure there are offshoots—parts, for instance, that are made in Canada. I would point, for example, to the F-35s, where we're not building the entire aircraft but there are Canadian suppliers that are part of that process. In every single F-35, there are parts made.... What I'm trying to say is that we need to be able to identify which parts of the Canadian defence industry we can bolster and support, because we know we will always need that sovereign capability, and which parts are where, frankly, taxpayer dollars are better spent more efficiently with some other supplier.

[Lindsay Mathyssen, NDP, London—Fanshawe, ON]

Is there no understanding, though, even if you're spending a little more within Canada, that it actually helps Canadian taxpayers, considering we're talking about very good-paying Canadian jobs?

[Stefanie Beck]

Sure. It's a decision, though. We can lay all that out in the strategy and can be clear that, if you want to support a Canadian buyer in this particular instance, it might take a bit longer and might cost a bit more. However, we can be clear about that and not wonder later on why it cost so much—because we made a decision to invest in Canada.

[Lindsay Mathyssen, NDP, London—Fanshawe, ON]

To shift back to what we were discussing when the minister was here, he said, about the five-year review, that he was taking it seriously but that the review hasn't started. However, the external monitor reported there was already an approved redesign of SMSRC on the shelf.

I'm trying to determine what's going on there, in terms of that miscommunication, because it was not made clear when I asked the minister. Is it that the design is being created and that there's an expectation, within the five-year review, that it will just be rubber-stamped? What's going on in terms of that? There's a conflict or a contradiction there.