Mr. Speaker, I will be sharing my time with the member for Pierrefonds—Dollard.
It is a reasonable expectation that a budget should not just explain to us but to all Canadians how the government plans to spend its revenues. It should tell Canadians what it plans on doing with their tax money. Further, it is a reasonable expectation that a government putting forward a budget would want, and therefore make efforts, to explain to Canadians how it would do that.
However, these are disappointed expectations. Instead, we have a government that lacks the courage to live up to these expectations and even lacks the courage of its own convictions. Instead, we have a fundamentally dishonest document in this year's budget. It ducks, dodges and dives. It makes stuff up and pretends.
Let me illustrate this point with the subject of military procurement. In 2008, the government introduced the Canada first defence strategy, or CFDS. It is not so much a policy or strategy, as it is a mighty expensive shopping list, calling for $490 billion of spending over 20 years. We now know that is vastly understated.
Only two years after its introduction the Department of National Defence deemed the CFDS unaffordable. The briefing book prepared for the Associate Minister of Defence by the department in the wake of the May 2011 election stated, “The funding reductions from Budget 2010 and the reduced funding line going forward will make the Canada First Defence Strategy (CFDS) unaffordable”. The recommendation is to “conduct a CFDS Reset to confirm level of ambition”.
It needs to be noted that the CFDS was considered unaffordable even when the department was still budgeting just $5.7 billion for the sustainment of the F-35, which the CFDS states the government will buy. Therefore, the department's assessment of the unaffordability of the CFDS was and remains accurate.
Of course it is not just the associate minister's briefing book that we have to look to for an assessment of the affordability of the CFDS. The Minister of National Defence put together a transformation team in 2010 to “develop ideas to increase efficiency and effectiveness, and to act as the driving force behind organizational changes needed to reposition the DND/CF for the future”.
I am quoting from the forward to the “Report on Transformation 2011”, otherwise known as the Leslie report after its main author, now retired Lieutenant-General Andrew Leslie. This was not just about finding savings to the tune of a billion dollars per year from the budget. Rather, in Lieutenant-General Andrew Leslie's terms it was also about making “the Canada First Defence Strategy more achievable within the resources available”.
As early as 2010, that shortfall was anticipated to be at least a billion dollars per year.
It should be noted that none of Lieutenant-General Leslie's recommendations were implemented. Also, the reset or rewrite of the Canada first defence strategy recommended by the department and the associate minister remains an outstanding promise of the current Minister of National Defence. In other words, since 2010, the government has carried on pretending that it has a real, viable, affordable plan for military procurement. That pretense carries right on through into this budget with the incorporation of a document entitled, “Canada First: Leveraging Defence Procurement Through Key Industrial Capabilities”, otherwise known as the Jenkins report.
The Jenkins report's principal objective is to “outline an approach to maximize the overall benefit of the government's CFDS investment”. It assumes that the CFDS is affordable, that it is a viable military procurement plan and that it is what it had proclaimed itself to be in 2008. It assumes that military procurement under the CFDS will generate $49 billion of industrial and regional benefits. It continues the pretense that the CFDS is not long dead, and by way of the incorporation of that report into the budget, so does the budget.
One might ask what the harm is in pretending that we can afford that shopping list, when we cannot.
Let us examine the recent case of the joint support ships. In 2004 the Liberal government set out to purchase three of these with a budget of $2.1 billion. By the time the bids from industry rolled in under the Conservatives in 2008, it was clear that there was not going to be enough money to get just two ships. The Department of National Defence advised the minister in August 2008, the very same month that the bids were deemed non-compliant, that it was going to cost at least $3 billion to buy those ships.
The Conservatives responded by budgeting $2.8 billion two years later in 2010. Now the PBO has advised in a recent report on the matter that the government should be budgeting over $4 billion for what it intends to buy. More important, it also advised that the $2.8 billion that the government has budgeted has actually less purchasing power than the $2.1 billion the Liberals had budgeted in 2004.
The Conservatives started from behind and then stepped backward. The threat is that if the government continues to behave this way, if it continues to pretend that it can be things that it cannot, that it can buy things that it cannot, then we will continue to walk backward. It is called program failure and it has devastating consequences to the recapitalization of our Canadian Forces.
From the sea to the air, we can see that when one pretends to be able to buy it all, a priority is put on nothing. We have fixed-wing search and rescue being performed in this country by aircraft that is nearly 50 years old, belongs in a museum and is in need of replacement. However, the effort to procure replacement fixed-wing search and rescue capability has been grounded, squeezed out by other procurements higher up on that shopping list. Asked just last week about this procurement, the minister responded by saying that it was a good question and pointed his finger at his colleagues and their departments.
On the ground there is a different story still. Procurement projects for the family of land combat vehicles are all at different stages. This includes the LAV III upgrades, close combat vehicles, tactical armoured patrol vehicles, tanks and howitzers totalling, as best as one can make out from beating the bushes, about $6 billion in acquisition costs.
Obviously it is the army for whom these vehicles are intended that seems to be taking the brunt of the budget cuts. Now there is no reference per se to DND budget cuts in the budget. Those facts, that information, in the words of one budget commentator, is only being whispered “in Swahili at the bottom of a well”. However, the chief of the Canadian army, Lieutenant-General Devlin, appeared before a Senate committee recently, acknowledging that his force is facing at least a 22% cut. Reports suggest that a further 8% cut is coming effective next week.
With the government keeping up pretences that the CFDS is affordable, that budget axe is going to fall on operations and maintenance and readiness. It means no more Arctic training. It means a fire sale on government property. It means recapitalized fleets with empty gas tanks as the fuel budget going forward comes nowhere near covering cost increases from the past.
The Conservative government introduced the Canada first defence strategy with the promise of “stable and predictable defence funding”. That promise did not even last two years. It is just that the government has spent the last three years pretending that it did not break that promise.
This budget continues that pretence to the detriment of the Canadian Forces. This budget perpetuates the pretense that this is a competent government. It is most certainly not. The military procurement file brings that truth into sharp relief.