On behalf of the Richards of the world, thank you very much for the opportunity to speak about an issue that I have worked on for a large number of years, but, I must admit, never with a great deal of success. To some degree our inability to effect improvements in defence procurement prompted me to reflect on these challenges. With limited improvements in mind, these are the reflections I hope to pass on to you today. I hope they're useful.
Before I come to my substantive remarks I have two meta points. First, I served both Conservative and Liberal governments, and I am convinced my remarks apply to both periods. Second, there is no silver bullet to this multi-faceted problem. Over the years, I have discussed and studied the DP experience of our allies, and everywhere there are levels of complexity that show elements of similarity with ours.
I believe there are three groupings or institutions principally responsible for defence procurement: politicians, public servants and the defence industry. I'll concentrate on the first two. Let me take them in turn.
Politicians, entirely appropriately, set a number of pan-governmental objectives to be pursued. Each objective on its own may be entirely appropriate and reasonable to pursue; however, the problem with DP arises when they conflict with one another. In the area of defence procurement, military acquisitions potentially conflict with any number of other objectives, including industrial objectives, and regional developments and innovation. These objectives are then bureaucratized by the public service and add considerable complexity for everyone involved, including the private sector. Over time all of this develops a culture, which itself becomes highly problematic. I'll say more on this in a second.
I'm not suggesting these objectives should be ignored in the context of defence procurement. Rather, their impact should be detailed and made public so that a judgment can be made on the appropriate balance among the various objectives. Also, in specific circumstances, not routinely but not rarely, the public service should be able to recommend and the government accept that the application of some specific objectives should be suspended. These suspensions in support of urgent defence acquisitions should be susceptible to acceptance by Parliament and the media, which is potentially another area where cultural change would be necessary.
As for the public service, concern about the reactions of ministers, the House and the media have made public servants very rule- and process-oriented and very risk-averse. I suggest this has become the dominant culture with respect to any public servant who has anything to do with defence procurement. The way the Federal Accountability Act has been implemented also does not help.
I'm not advocating irresponsible action but rather an acceptance of some measure of risk and the possibility of error in favour of more effective acquisitions. In practice this might mean an environment where acceptance of exceptions to rules in favour of special arrangements can be sought, without being career-limiting. One easy example is that the public service has become extraordinarily reticent to take any action that raises the possibility of litigation, even though over the years the government wins most of the litigation. There's a real resistance, and this just gridlocks things because of the fear of litigation.
Another issue shared by ministers and public servants is the principle that defence procurement rules apply across the board, notwithstanding the size or complexity of specific acquisitions. I know that I'm generalizing here, but I believe that this approach should be further developed. As an example, increase delegations and have fewer rules when the acquisitions arrive and they're not particularly complex, or when not a great deal of money is involved.
Another matter is illustrated by the debate about the appropriate organization and mandates of departments and agencies involved in defence procurement. In looking at our allies, it's clear there is no perfect model. Whatever model is chosen, it seems to me that it must take into account the political, legal and cultural environment. To me it would seem very problematic to change our current machinery, which involves a great many departments and agencies, without resolving the various issues and challenges surrounding DP.
In conclusion, to the extent that the points I have made are valid, I would suggest they need to be addressed together if a material improvement in DP is to be brought about. As these issues involve multiple departments and legal and regulatory machinery issues, they can succeed only if reforms have the support of the Prime Minister. A single minister, a single department, isn't going to make material changes in this area. It has to be a pan-government operation. In the end, cultural issues may be as important as substantive ones.