Public Accounts Committee on May 1st, 2017

[John Forster]

We're doing quite a bit. I'll ask Pat to talk about how we use the procurement system to leverage that.

[RAdm Patrick Finn]

I think the key policy enabler is around the industrial and technological benefits program at Industry, Science and Economic Development Canada. In the context that you ask how we are specifically leveraging—

[Chandra Arya, Liberal, Nepean, ON]

No, ITB has been there for a long time, but the benefits that were supposed to come from it are not happening.

[RAdm Patrick Finn]

Well, a lot of it is happening. If you look at a project like the Canadian surface combatant as an example and request for proposals coming in, 10%, I think, is the number of the value that has to be around small and medium enterprises' research and development innovation. We're already seeing, through the application of the policy, direct implications for Canadian companies, small and medium enterprises.

[Chandra Arya, Liberal, Nepean, ON]

I am sorry, but time is short.

One specific segment in the different sectors is the C4ISR. In Ottawa we have 1,700 knowledge-based companies. We have the technology talent. We have everything that is required. We have a model in Washington, Annapolis belt. There are hundreds of small companies that cater to this particular sector. Is there anything you can do to promote small technology companies in Ottawa to specialize in C4ISR?

[RAdm Patrick Finn]

Again, if I could, that's where we're working with ISED, and they lead this area for the government. What we're doing around key industrial capabilities is, in fact, to identify that as a key industrial capability, to leverage it using intellectual technological benefits to drive it into a lot of our products.

[Chandra Arya, Liberal, Nepean, ON]

Once again, KICs we have been talking around, but I'm looking at when the action will start.

[RAdm Patrick Finn]

It has started in a number of things that are being bid on. If I look at such things as fixed-wing search and rescue and a number of other carriers, Canadians are doing a lot of the integration around C4ISR solutions, small and medium enterprises that are being leveraged.

[Chandra Arya, Liberal, Nepean, ON]

Okay.

I hope you guys look into the interaction between DRDC and the industry that takes it to the next higher level. I've been told by a lot of technology companies here that it is very difficult for them to understand the customers' needs. It is very difficult to get to and talk to the end customer because of the security requirements for anybody entering into the DRDC premises to have a meeting.

[John Forster]

We've also heard the same comments as we're doing the policy review. So again, if you can be patient another short while longer, I think you'll see that addressed.

[Chandra Arya, Liberal, Nepean, ON]

Okay.

You also mentioned this different resource management information system. Whenever somebody talks about an information management system, all the flags go up for us. We have seen Phoenix; we have Shared Services, etc. Are you facing any problems there?

[John Forster]

The flags go up with me too, believe me.

As I said, when I came to the department, I think DRMIS had kind of stalled because it was trying to become one system where all the data went into it. We completely changed our approach to that. It will sit on top and grab data from other systems rather than trying to build—

[Chandra Arya, Liberal, Nepean, ON]

No, my thing is, are we getting the resources to implement this?

The last question is, you mentioned it is very difficult to estimate the cost of the various programs we talked about. What is the experience in the U.S., the U.K., or France in terms of their costing?

[The Chair, Conservative, Kevin Sorenson]

Someone has a very short period of time to answer that.

Mr. Finn.

[RAdm Patrick Finn]

It's very similar to ours. In fact, we share best practices, and they have the same challenges we have.

[The Chair, Conservative, Kevin Sorenson]

Thank you.

We'll now move back to the opposition and to Mr. Jeneroux, please.

You have five minutes.

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

Thank you, Mr. Chair.

Thank you to the witnesses for being here today and taking time out of your day to be here.

I want to come back to Mr. Forster on some of the questioning that my colleague beside me was asking, particularly with the life-cycle cost of purchasing the interim fleet of Super Hornets.

There was a National Post article February 2, 2017 where it says, “Sajjan announced in November the government’s decision to buy 18 Boeing Super Hornets as 'interim' fighter jets until a permanent replacement for the existing CF-18 aircraft could be bought.”

On that line of thought, I was hoping you could tell us what was included, what was excluded, and over how many years the life-cycle cost for this would be analyzed?

[John Forster]

I think if you read the actual announcement of the government, it did not say that it had decided to buy. It had decided to enter into discussions with the U.S. government and with Boeing to look at the possible purchase of 18 interim aircraft.

Part of the reason we're not making any decision to buy is we need information on capabilities, cost, schedule, and economic benefits for Canadians. As I mentioned, that letter of request has gone to the U.S. government, and that's the information that the government will then look at before finalizing any decision to purchase.

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

I understand that, and that's similar to your response earlier. However, it's obvious that the minister is preparing to go down this path, so is he going down this path without the support of the department?

I'll read you one more quote, this one directly from Hansard in question period, where the minister states, “We are investing into the legacy fleet as well. Plus, we are buying new Super Hornets.”

I don't know how much clearer that could be. You're obviously buying the Super Hornets, so we are asking for the estimated full life-cycle cost of purchasing them. Do you not have that? You mentioned that you're planning to do it. Can you help us out here? It sounds like the minister is buying these things, but it doesn't sound like you're in the loop that he is buying these things.

[John Forster]

Well, I would draw your attention to the government's announcement. When we get a response from the U.S. government to the letter of request, that will provide us the information on which we'll base a life-cycle cost analysis of those planes, and the government will then make a decision on whether it wants to proceed.

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

So you don't have the life-cycle cost.

[John Forster]

That's what I said. That's why we are getting the information. It's part of our letter of request to the U.S. government. We will do that and do our own analysis and challenge of those numbers, and develop a life-cycle cost estimate in the fall.

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

I can appreciate that if you don't have the information, you don't have the information. But then why is the minister saying, “We are buying new Super Hornets”? Why would you go down this road without having the costs associated with it?

As a guy from Alberta, I think this doesn't seem to jive. Where I'm from, you would go and buy something if you had the estimated full cost of it. You're saying you don't have the estimated full cost, and the minister said we're buying them, so I'm struggling to understand where exactly the disconnect is. Is the minister going alone on this? Is that your opinion, perhaps?

[John Forster]

Of course not, Mr. Chair. The minister is not going alone. He is working with his colleagues, the Minister of Procurement—

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

He doesn't appear to be.