Public Accounts Committee on Oct. 7th, 2025

[Stefanie Beck]

As you know, our current projects are usually several months or even years old. So it is completely standard procedure for announcements to be made after a new government comes to power. I want to mention the major decisions we have made recently, including the one about over-the-horizon radar that we have just purchased from BAE Systems Australia. This is a huge investment for Canada's future and for protecting our sovereignty.

We also have another huge project: the purchase of destroyers that will be built by the Irving shipyard in Canada. There are also submarines, which will definitely not come from the United States. So we are already pivoting toward countries other than the United States. However, that does not mean we will no longer buy anything from the Americans, because they make good products. I would add that most of what the defence industry in Canada exports goes to the United States.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Interoperability is indeed important, but where a number of countries are participating, what is Canada's contribution to building the F‑35s? In Quebec in particular, we have an aerospace industry that can build a plane from start to finish. The F35s are being purchased at the expense of a number of other options that would have resulted in more consideration being given to Quebec.

What is Canada's actual contribution? If these planes are costing us a lot of money, what are we getting back in income and other taxes?

[Stefanie Beck]

At present, there are about 30 Canadian companies that build different parts of each aircraft. That comes to over $3 million Canadian per plane. There are also other contracts coming up. I know that every month, Lockheed Martin and Pratt & Whitney go looking for new partners to build these various aircraft, and this is working well in Canada. There are also very specific examples in Quebec. If these Canadian companies did not supply those products, the planes would not be able to fly. They are essential to the future of every plane.

Howmet Aerospace makes optical bed castings—I apologize to the interpreters—and Nav-Aids Ltd. makes port covers and pressure test adapters.

I also have to say that the Canadian government has been helping to promote the defence industry in Canada for years through various programs at the Department of Industry.

[The Chair, Conservative, John Williamson]

Thank you.

Mr. Lemire, you will have an opportunity to ask more questions later.

Our next round will consistent of five members for various times.

Mr. Deltell, you have the floor for five minutes.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

Thank you, Mr. Chair.

Good afternoon, colleagues.

I would like to welcome the witnesses.

Welcome, Lieutenant-General. Thank you very much for your service abroad in Haiti, Bosnia and Kuwait. Thank you for doing our country proud and for starting your career in Valcartier. I am being a bit chauvinistic, but I am very proud of that.

I have a lot of subjects to discuss. Let's start with the question of cost overruns.

Ms. Hogan, you said in your report that the amount initially projected for the Future Fighter Capability Project was $19 billion, but because we did not have good basic information, that amount has now risen to $27 billion. You also said things were not looking good, because there are a number of risks that costs could rise even more.

We are talking about tens of billions of dollars that have been miscalculated, including money from the goods and services tax and income taxes paid by the people following our proceedings right now. How do you explain public finances going this far off track?

[Karen Hogan]

I could refer members to exhibit 2.5 to our report, which explains in more detail why the projected $19 billion went up to $27 billion.

As I said, some costs were beyond the control of National Defence, in my opinion. However, the department had determined that certain elements presented risks. If it had been more proactive in managing those risks, I think that would have helped. That being said, the costs would still have risen.

However, the department could have exercised control over certain elements. For example, the first estimate was based on outdated data, when more up-to-date estimates for fighter jets could have been used.

Delays in moving plans forward, the need to build interim aircraft maintenance facilities, and pilot training also contributed to cost increases.

As we said, the risks, of which there are many, should have been better managed. Six of them were not yet approved at the time the costs were estimated. No risk mitigation plan had been made and two of those risks were inflation and foreign currency. So there are some things that could have been better controlled.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

How can we be confident about what comes next if the risks have not been controlled in recent years?

As you put it so well, we are already slightly behind in terms of facilities and infrastructure, not to mention the runways that will now have to accommodate the CF‑35s. You also talked about certain essential elements needed for full operational capability, such as infrastructure upgrades.

What message is this sending to the taxpayers who are paying for it all and thinking that if things have been done willy-nilly over the last ten years, we need to worry about what is coming?

[Karen Hogan]

Regarding costs, we think $5.5 billion should be added. That gap tells us a bit about how National Defence manages its projects.

I see my responsibility as being to ensure that Canadians and parliamentarians know the total cost of the CF‑18 Hornet to CF‑35A transition, which is why other costs from other projects should be included.

I think our recommendations are going to address the shortcomings we have identified that should be corrected through better, proactive risk management, but also by publicly considering the price of the project and including all the elements that are essential to it in order for everything to be fully operational.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

You don't need a doctorate in history to notice that history repeats itself.

In the 1990s and 2000s, a newly elected government abolished the program that had been designed to upgrade 30-year-old helicopters. A few decades later, in 2015, another newly elected government did exactly the same thing by cancelling a signed contract, and then returning seven years later to the same decision.

I'd like to draw your attention—and I'm speaking more to the people who are watching our proceedings, because I don't want to throw a can of political paint at you—that two Liberal governments did this. The governments of Mr. Chrétien and Mr. Trudeau abolished one program and proposed another, which ended up costing much more seven years later.

Earlier, you answered my colleague's question by saying that there was a lot of concern about the politicization of debates like this. We see that history is repeating itself. Can you explain how a government of the same stripe made the same mistake 30 years later?

[Karen Hogan]

I'm not the person you should be asking. I'm not in a position to explain why some elected officials made the decisions they did.

In my opinion, the time has come for Parliament to decide on the role of the Canadian Armed Forces and what they need to ensure our security and sovereignty. We have to make sure that we don't change our minds, and we have to leave it up to National Defence to buy or build what the armed forces need.

[The Chair, Conservative, John Williamson]

Thank you very much, Mr. Deltell.

Up next is Mr. Osborne.

You have the floor for five minutes please.

[Tom Osborne, Liberal, Cape Spear, NL]

Thank you.

I'll attempt to take the politics out, because I'm not sure what punishing Mr. Chrétien or Mr. Trudeau will do. Focusing on how we improve the future is what I'm interested in.

I know that the joint strike fighter program has certain requirements that need to be met before the jets can be delivered. Can you update us on what measures are being put in place to ensure that we will meet those requirements so that we can receive the fighter jets?

[LGen Jamie Speiser-Blanchet]

I believe I can help to answer that one.

In concert with the future fighter capability project and the project office, we're working together to ensure that the implementation plans are continually monitored and updated. One of the key plans in that, as mentioned by the Auditor General in the report, is the master implementation plan.

This is the overall document and entity that is guiding the Royal Canadian Air Force, in concert with our other partners and colleagues, to ensure that all of those various different pieces are in place.

One of the elements that we also have is the fighter operational implementation working group. That is a governance structure that meets regularly, and it also comprises several sub-working groups. In fact, there are 13, because they're all looking at different elements, from information systems and infrastructure to security and training. There are several. It's important that the fighter operational implementation working group maintains the cohesion that we need to make sure that things are all progressing, and being tracked and monitored, on a routine basis in order to meet the milestones that are outlined in the master implementation plan.

We review that. It is a living document, because conditions certainly change rapidly, and it is something that we're committed to continuing to refresh as often as possible. That is our guiding document to achieve what you've asked.

[Tom Osborne, Liberal, Cape Spear, NL]

We are on track, then, to have those measures in place to receive the jets when the jets are ready.

[LGen Jamie Speiser-Blanchet]

At this point in time, yes, we are. As mentioned in the Auditor General's report, we know that the permanent infrastructure of the two fighter squadron facilities, which are the two main squadron buildings—I was going to say hangars, but they're very large, giant—one in Cold Lake and one in Bagotville, will not be ready until 2031. That is the projected time. However, we have interim plans that are all on track. They're going to involve some temporary training facilities and temporary hangars and hangarettes, which are small structures that are able to shelter the F-35s as they start arriving in Canada. That's projected to be in 2028.

[Tom Osborne, Liberal, Cape Spear, NL]

On the air control and air attack capability, can you talk about that and whether we are ready in terms of those two aspects as well?

[LGen Jamie Speiser-Blanchet]

Forgive me, but which...? Did you say “air control”?

[Tom Osborne, Liberal, Cape Spear, NL]

With respect to Canada's future fighter jets, National Defence is also responsible for improving the Canadian Armed Forces' air control and air attack capabilities.

[LGen Jamie Speiser-Blanchet]

I believe those are, if I'm understanding correctly, capability sets that we achieve with the fighter aircraft, so that would all be encompassed within the type of training that we provide to our air crew.

As far as I know, that's something that is being worked on, and I don't know of any delays or challenges with that.

[Tom Osborne, Liberal, Cape Spear, NL]

In terms of the shortage of pilots, engineers and aircraft maintenance personnel, can you talk about your recruitment strategies to ensure that we have those resources in place to receive the jets in a timely manner?

[LGen Jamie Speiser-Blanchet]

We have a number of efforts in place, because it is well known that we have been short on personnel. As was mentioned and highlighted, in the fighter force specifically there has been a shortage of pilots and a low number of technicians. We have put many initiatives in place. There's no one-size-fits-all approach that is going to fix everything. However, we are seeing progress in the numbers, and they are increasing.

For example, some of the proactive enrolment of skilled pilots has taken place, and we have been able to re-attract back to the RCAF some pilots who had retired. Some of that was due to an increase in pilot pay specifically, which took place before the most recent increase in pay for all military members this past summer. Those are having the positive effect of attracting some members to return to the force if they had left. If we have those skilled applicants with that experience, then that is something we prioritize. We have people in place to help them return and go through that re-enrolment process more effectively.

We also have a number of subsidized education and recruiting allowances on the technician side. We are working with many civilian colleges that offer some of the training, so we can leverage the training that is happening with academia right now. We are able to work with them as partners to subsidize some of the training or education, so those technicians can then join us.

In terms of current staffing levels, since our most recent report to this committee in June, the fighter pilot staffing level has increased to 70.5% of what it was. It had last been reported at 66%, so this is a positive improvement that we must absolutely maintain.

For our maintenance personnel, we're up to 86%, which is up 1.6% from June. A lot of these efforts, in concert, are working to ensure we can not only attract new members to come through but in many cases retain the experienced members we have invested so much in, certainly in terms of a fighter capability.

[The Chair, Conservative, John Williamson]

Thank you.

That is your time and well over. I wanted to get a full answer from the general.

Mr. Lemire, you have the floor for two and a half minutes.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Thank you, Mr. Chair.

Ms. Beck, during his visit to the United States today, Prime Minister Mark Carney highlighted that Canada will invest $1 trillion over the next five years. One of the things we can expect to see is significant military spending. Why is the government still turning to the United States after campaigning and saying that it had to elbow its way? I think this is a situation that will increase our dependence on the United States.

The Americans would also have asked us to ensure greater security on our military bases hosting the F‑35s. They also said that the security access required to work on the F‑35s is more important.

How did you assess those requests? What are the costs associated with them? Have they been costed in predictable spending?

[Stefanie Beck]

Thank you for those questions. They aren't entirely related, but I'll answer them. I'll let my colleagues answer as well.

I'll repeat what I found with respect to procurement. We're diversifying our sources to meet our national defence needs by purchasing from Australia, the United Kingdom or Europe. We travel, make calls, and receive visitors from abroad to find out where we can find other sources to help us defend our country and to have better partnerships for the future of our industry. Indeed, a stronger and more resilient industry will need to be created in the future.

With respect to the issues related to the security of various infrastructures, I'll ask Mr. Hammerschmidt to answer as well. Those are changes that took place after 2019, so this is still one of the challenges we have in calculating various costs. However, beyond serving as a facility for aircraft repairs, it’s also used for training and maintenance, among other things.

I have to say this in English.

If you think of a big, compartmentalized security room—a classified room—it's basically that over the aircraft.

I'll now give the floor to Mr. Hammerschmidt.

[Peter Hammerschmidt, Assistant Deputy Minister, Infrastructure and Environment, Department of National Defence]

Unfortunately, since a number of terms are technical, I'll have to speak in English.