Evidence of meeting #77 for National Defence in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was tool.
A recording is available from Parliament.
4:55 p.m.
NDP
4:55 p.m.
Conservative
Pat Kelly Conservative Calgary Rocky Ridge, AB
Thank you, Chair.
I want to return to the Victoria-class submarines. We know that we are generally lucky to have one that's operational at any moment.
This is a direct expense. Again, just so that we understand, is the entire program a direct expense? How does this measure when such an extraordinary amount of money is spent on the maintenance and the non-operational time the individual units have?
4:55 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
As I understand it—and Chris and Binyam can correct me if I'm wrong—the submarines themselves and the personnel on board would be direct, but the base and the expenditures at the base would be either indirect or overhead, depending on the precise nature of—
4:55 p.m.
Conservative
4:55 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
Some of it could be overhead. As Binyam indicated in the response to a previous question, the commander at the base could, for example, be attributed in part to overhead costs for the submarines.
4:55 p.m.
Conservative
Pat Kelly Conservative Calgary Rocky Ridge, AB
All right. Boy, the different grades—direct, indirect—or how you classify these things really weighs into how the ratios work.
4:55 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
I gave examples here that may not be the best examples, but overhead could also be the defence research and development attached to that, maybe not that much in the case of subs but in intelligence or other types of expenditures.
We did a very refined.... There were thousands of lines that were attached to every single military capability, thanks to the granular data that DND provided us. I'm not using the best example because I'm not intimately aware of every single one of these lines, but if you want to have an off-line conversation, I'm sure these two gentlemen would be more than happy to give you more accurate examples.
4:55 p.m.
Conservative
Pat Kelly Conservative Calgary Rocky Ridge, AB
Okay. I picked the submarines because it has already come up, and it's one that I think is an obvious concern. In 2019, we had zero subs that were deployable or at sea for even one day, yet there were significant expenditures on this equipment. I would hope that wouldn't be reported as a direct expenditure, because there are no teeth on a submarine that is on dry land or confined to harbour.
5 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
That reminds me of vocabulary that I learned in another report on dental care. It's “indentured” or something like that: no teeth at all.
5 p.m.
Voices
Oh, oh!
5 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
That would be a good analogy for that specific military capability.
More seriously, though, our tool would be based on historical data, so if there's a year where there were virtually no expenditures, that would be reflected in the data.
5 p.m.
Advisor-Analyst, Office of the Parliamentary Budget Officer
It's averaged over six years.
5 p.m.
Conservative
Pat Kelly Conservative Calgary Rocky Ridge, AB
Okay. Well, it's not that there are no expenditures when this equipment is not in the water.
I appreciate having the information—and I think that we as parliamentarians do—and having tools from the officers of Parliament who help all the MPs to do their jobs and hold the government to account. I do appreciate it. I know that there have been some questions that have been raised that seem to question the utility of what you're doing, and I'd like to make sure the record indicates my support for your office and what you do.
I have one minute left. James has one question.
5 p.m.
Conservative
James Bezan Conservative Selkirk—Interlake—Eastman, MB
Using the submarines as an example, maintenance, repair and overhaul are direct or indirect costs—or is it overhead?
5 p.m.
Special Advisor, Office of the Parliamentary Budget Officer
Some of the maintenance that is done at a fleet maintenance facility would be shown as an overhead. Costs associated with what National Defence terms “national procurement”, which is actually an amount of money it would spend on fixing the submarine, because the submarine is the capability we're looking at, would show up as an expenditure on—
5 p.m.
Conservative
James Bezan Conservative Selkirk—Interlake—Eastman, MB
A life-extension project to a frigate or, let's say, an F-18 fighter jet, would be what...?
5 p.m.
Advisor-Analyst, Office of the Parliamentary Budget Officer
That's capital.
5 p.m.
Liberal
Chad Collins Liberal Hamilton East—Stoney Creek, ON
Thank you, Mr. Chair.
I just want to get back to the program itself. There have been a lot of questions today, mostly around things unrelated to the force structure model, so I'll get back to that.
If I could, Mr. Chair, I'd like to ask—
5 p.m.
Bloc
Christine Normandin Bloc Saint-Jean, QC
The interpreters are telling me that the microphones need to be muted in the room. Otherwise they can't do their work. There's too much noise.
