Good afternoon. My name is Mark Beauregard and I am the vice-president for regulatory affairs at the Aerospace Industries Association of Canada.
Our members manufacture aeronautical and space products and engage in aircraft maintenance, repair, and overhaul. They contribute $28 billion to the economy each year and help to employ well over 200,000 people. Over 80% of the aerospace industry's goods and services are exported. Much of this is for civil applications.
Our industry complies with a vast regime of safety standards and regulations destined to ensure that air travel remains safe, reliable, and sustainable. Of course, safe products and services are an essential, necessary part of this safety imperative. This is only possible through international cooperation and a network of global regulatory bodies and arrangements.
Canada has long been a global leader in this area. Transport Canada's civil aviation branch, or TCCA, is known worldwide as one of the big four regulatory bodies, along with the U.S. FAA, Europe's EASA, and Brazil's ANAC. This is important not only because of the clear role TCCA plays in aviation safety, but also because TCCA's approvals and certifications open doors for Canadian products and services into global markets and make it easier for Canadian manufacturers and service providers to do business in foreign jurisdictions. TCCA's leadership doesn't only keep us safe, it also helps make us more prosperous.
We estimate that TCCA's continued position as a global certification leader can be directly linked to at least 30% of all Canadian aerospace activity. That's an economic impact of $10 billion in GDP each year. This should be a good news story, an example of how a modern regulator keeps Canadians safe and creates economic opportunity for innovative and entrepreneurial Canadian businesses. However, Transport Canada's ability to maintain its standard of service is at risk, even as its role is more important than ever.
Over the past 10 years, Canada's aerospace industry has grown substantially. Our economic impact has increased by 31% in terms of GDP, by 39% in terms of productivity, and by 64% in terms of R and D spending. Over the same period of time, the budget for Transport Canada's certification and standards branch has not increased at all. In fact, in real terms it has actually been reduced. This is having a significant negative impact. The lack of adequate funding has resulted in delays on certifications and approvals. It is creating bottlenecks and is impeding the industry's ability to keep up with demand and stay competitive in foreign markets. We are now seeing warning signs that TCCA's global reputation as a leading aviation authority is being questioned by the international community. Once that reputation is lost, the competitive advantage enjoyed by Canadian companies that rely on TCCA services will also disappear.
It's a well-known truism that reputations take years to build, but can be lost very quickly. This is certainly applicable to TCCA. To put it bluntly, TCCA's long-held position as a leading global certification and regulatory authority is at risk.
But there are a couple of pieces of good news. First, it's not too late to fix the problem and restore Transport Canada's ability to continue its role as a world-leading aviation authority. Second, it's not a difficult fix. We estimate that a budget infusion of $30 million over five years into TCCA's certification and standards branch would be enough to protect the $10 billion that TCCA helps drive into our economy each year.
As you look at the study, we encourage you to consider the important role that TCCA plays in ensuring Canada's aviation safety, as well as the impact it has on Canadian businesses and communities that reap the rewards of its global leadership. I urge you to ensure that TCCA receives the financial support it needs to do its very important work.
Thank you for your time. I'm happy to answer any questions.