Thank you, Mr. Chair.
Thank you for this opportunity to discuss our report, “Delivering Canada's Future Fighter Jet Capability”, which was tabled in the House of Commons on June 10.
I would like to acknowledge that this hearing is taking place on the traditional unceded territory of the Algonquin Anishinabe people.
Joining me today is Nicholas Swales, who is the principal responsible for the audit.
In December 2022, the federal government finalized an arrangement to buy 88 CF‑35A fighter jets and associated equipment, weapons and services, from the United States to replace Canada's aging CF-18s. The prime objective of the future fighter capability project is to maintain a strong and modern fighter jet capability to defend our country and meet Canada's international defence commitments. This initiative is in its early stages. Based on the current plan, Canada's first CF-35s will be sent to Luke Air Force Base in Arizona in 2026 to support pilot training, while the first aircraft will arrive in Canada in 2028.
For this audit, we wanted to know whether the Department of National Defence had achieved progress on its plans to introduce the CF-35s into service so that fighter capability would be delivered on time and on budget. We found that the estimated costs of the future fighter capability project had significantly increased and that the project faced several risks that could jeopardize the timely introduction of the new fleet. National Defence originally estimated that the project would cost $19 billion. The audit found that this figure was based on outdated information and that, by 2024, the projected costs had increased to $27.7 billion, almost 50% more than the original estimate. Some of the cost increase was caused by factors beyond the department's control, such as inflation and foreign exchange fluctuations.
We found that construction of two fighter squadron facilities to accommodate the CF‑35s was more than three years behind schedule. As a result, an interim plan was needed, which will further increase infrastructure expenses.
We also found that cost estimates for the project did not include other essential elements needed for full operational capability, such as essential infrastructure upgrades and advanced weapons. These would add at least $5.5 billion to the total cost.
In addition, National Defence still had to address other risks that could jeopardize the timely introduction of the CF‑35 jets. For example, in 2018, when we last audited Canada’s fighter force, we found that one of National Defence's biggest obstacles was a shortage of qualified pilots. Six years later, that is still the case. Because the planned pilot training program would not produce enough pilots by 2032‑33, a new approach was needed.
Finally, National Defence also had to complete the transition plans, such as the integrated master schedule and aircraft maintenance plans.
Maintaining a strong fighter-jet capability contributes to the safety and security of Canadians. This is a large, multi-year project that requires active and ongoing management of risks and costs to ensure that the CF‑35 fleet can be brought into service on time. In the current context of increased defence spending, effective oversight and timely decision-making will be essential to optimize resources and ensure operational readiness.
Mr. Chair, this concludes my opening remarks. We will be pleased to answer any questions the committee may have. Thank you.