Science and Research Committee on May 4th, 2026

[Maxime Blanchette-Joncas, Bloc, Rimouski—La Matapédia, QC]

All right. Let me give you another concrete example.

In the case of a contract worth approximately $100 million for night-vision goggles, a Quebec-based company, Canex, located in Saint-Jean-sur-Richelieu, had to take its case to the Canadian International Trade Tribunal. The tribunal asked the government to review a call for tenders that was deemed too restrictive.

We want to encourage innovation. We have companies here that want to innovate. However, they have to go to court to challenge the tender criteria the government has set.

Can this type of situation prevent local companies from contributing to this goal of stimulating innovation in the defence sector?

[MGen Paul Peyton]

I'm sorry, sir. Again, I am not the person to speak to Canadian defence acquisition policies right now. That is not the place where I sit. There are certainly other experts within the Canadian Forces who could better address that question.

[Maxime Blanchette-Joncas, Bloc, Rimouski—La Matapédia, QC]

Let's keep it simple, Major General.

If I have a garden and I don't water it, do you think the vegetables will grow? It's the same thing here. We have businesses, and we're not encouraging them. We're buying solutions from foreign companies, even though we're told that we want to be economically sovereign—and even in terms of defence.

Do you think people will invest here when, at the end of the day, government contracts go to foreign companies?

[The Chair, Liberal, Salma Zahid]

I am sorry for interrupting, but the time is up for you, MP Blanchette-Joncas. Maybe you can come back in the second round.

[Maxime Blanchette-Joncas, Bloc, Rimouski—La Matapédia, QC]

I will ask for a written response, Madam Chair.

[The Chair, Liberal, Salma Zahid]

Major-General Peyton, is it possible to provide a written response to MP Blanchette-Joncas' question?

[MGen Paul Peyton]

I think that is a question that is better addressed to folks who are serving with the chief of force development, chief of program or some entity within the office of the vice-chief of the defence staff.

I'm sorry. I don't mean to push back on you. It's just that I work for NATO DIANA now. It's just not the space that I'm in.

[The Chair, Liberal, Salma Zahid]

I totally understand. Thank you.

With that, the first round comes to an end.

We will start our second round of five minutes with MP Mahal.

[Taleeb Noormohamed, Liberal, Vancouver Granville, BC]

On a point of order, Madam Chair, at what time did we start and how much time do we have?

[The Chair, Liberal, Salma Zahid]

I think we will have five minutes with MP Mahal and MP Nathan, and then two and a half minutes. That's where we will stop. Then we will suspend the meeting to go into the second panel.

[Taleeb Noormohamed, Liberal, Vancouver Granville, BC]

Thanks.

[Vincent Ho, Conservative, Richmond Hill South, ON]

Do I get on a technical [Inaudible—Editor]

[The Chair, Liberal, Salma Zahid]

No.

MP Mahal, please go ahead.

[Jagsharan Singh Mahal, Conservative, Edmonton Southeast, AB]

Thank you, Madam Chair, and thank you to all the witnesses for being here today.

I want to start with Major-General Peyton.

General, Edmonton is home to thousands of active-duty Canadian forces service members. It is a military city and a hub for defence innovation. How accessible is DIANA to small and medium-sized Canadian firms? Are they successfully competing for participation within the program? Can you comment on this?

[MGen Paul Peyton]

Yes, I can, sir. I am well aware of Edmonton. In fact, I served many years there, and I really enjoy the city.

I can tell you that 18% of the proposals that we received came from companies in Alberta, so I think there is an active involvement of innovators in western Canada, and Alberta in particular, that understand what DIANA is doing. In fact, our regional director is at the defence conference that is occurring in Calgary this week, and we have test centre facilities in Alberta as well. We are active all across Canada.

[Jagsharan Singh Mahal, Conservative, Edmonton Southeast, AB]

Given the size of Canada's Arctic region, how can Canada effectively leverage modern drone technology to secure and defend the region?

[MGen Paul Peyton]

That's a great question. In fact, one of the challenges that we initiated last year was operations in extreme environments, which had a very specific focus on the Arctic.

It's not just drones, though. There are so many other capabilities that are available for sense and surveillance, whether they're space platforms, drones or ground-based platforms. Within DIANA, I believe 10 or 15 innovators were selected for that particular challenge. We will leverage the opportunities in the Arctic for testing to connect those innovators with end-users.

Operation Nanook, as an example, is one of the operational experiments and exercises that NATO DIANA will leverage for our innovators to have the opportunity to test their solutions and showcase them in the real operational environments where they'll be required.

[Jagsharan Singh Mahal, Conservative, Edmonton Southeast, AB]

I would now like to go to Mr. Asselin.

Canada produces world-class research. You and Mr. Manhas mentioned in your opening statements that.... This is not just you; we have heard from different witness testimonies that when it comes to research and excellence at the university and college level, Canada is at par with the world, but when it comes to commercialization, we lag behind, whether it's in AI, R and D, or innovation and technology.

In your opinion, what are the main barriers preventing the research from Canadian firms from becoming Canadian jobs and Canadian capabilities?

[Robert Asselin]

That's a good question.

In a nutshell, if I want to be very frank, it's a lack of absorptive capacity on the private sector side. Business R and D in this country is really low. The size of our firms compared to those in the U.S. is tilted on the small side. We don't have enough large firms that do R and D at scale.

Just to give you a stat, Madam Chair, 17% of Canadian manufacturing exports are considered high tech. That's compared to about 30% in the U.S. In other words, we can produce the best inventions and innovations, but if that's not captured on the private sector side, we're not going to get the benefits on the innovation and productivity side.

This is why I speak about interfaces and pathways. Unless we connect all these things together, we're not going to get the results that we need for this country.

[Jagsharan Singh Mahal, Conservative, Edmonton Southeast, AB]

During your testimony, you also mentioned that we are not in parallel when it comes to federal funding. You gave the example of the U.S, where they spend about 15% of their federal budget on university research. Where do we stand in comparison to countries like the U.S.?

[Robert Asselin]

Ours would be only 5%, but in that 5%, most of the R and D would go to federal labs, such as the National Research Council and DRDC, which is the federal lab inside the Department of National Defence. Less than 1% would go to universities. As a country, we're not going to be able to do what we need to do on innovation if we don't change that fundamentally.

I want to be clear. It's not just a question of funding—

[The Chair, Liberal, Salma Zahid]

I'm sorry for interrupting. The time is up for MP Mahal.

We will now proceed to MP Nathan for five minutes.

[Juanita Nathan, Liberal, Pickering—Brooklin, ON]

I'm going to give my time to Taleeb.

[The Chair, Liberal, Salma Zahid]

Okay.

Go ahead, MP Noormohamed.

[Taleeb Noormohamed, Liberal, Vancouver Granville, BC]

Thank you, Madam Chair, and thank you to my colleague.

Thank you to the witnesses for being here.

Karn, it's good to see you here. It's good to see a homegrown Vancouver Granville company here doing amazing work in the space that you're in. I want to thank you for all the work that you're doing, the jobs you're creating and the innovative research and the innovative businesses that you are now leading.

One thing I wanted to touch on has to do with how, in your case, Terramera's soil health and carbon sequestration technology could contribute to northern and Arctic food sovereignty as a defence-relevant objective. Obviously, one of the things that we've been talking a lot about is how we can enhance co-operation with indigenous and northern communities, as well as the private sector, to address evolving threats to the north to build climate-resilient, dual-use or multi-purpose infrastructure, particularly around this area. Anything you could share with us in that regard would be great.