National Defence committee  My understanding is that about 10 years ago, a rule was built into the process that declared that an industrial benefit that is offered by a company seeking a contract from National Defence must include 100% of the contract value of content made in Canada. In other words, an airc

National Defence committee  Well, everyone agrees that IRBs are important and are an essential element of any major procurement. The problem that we foresee is that because there are conflicting aspects to it from National Defence to industry, this can lead to an elongation of the procurement process. That

National Defence committee  That's a tough one. It's a subjective area. Defence spending is in fact a zero-sum game. Although the Department of National Defence may have to pay a premium to cover industrial benefits out of the carefully stated defence budget, in that sense they can't acquire as much as th

National Defence committee  That is quite true. Most of our allied countries do have industrial regional benefits programs, sometimes with other names. But it's important, particularly when a country has to buy offshore. There's a balance of payment question that can be resolved with a good industrial benef

National Defence committee  I'm not certain of the details of that, but I believe that's one of the reasons the C-17 has been seen as an excellent solution to the Canadian requirement, that it can handle deployments such as the disaster assistance response team.

National Defence committee  The Canadian aerospace and defence industry does compete very well, but in rather select niche markets. We have learned through sad experience, for example, with the Avro Arrow back in the 1950s, that Canada cannot compete with the big guys around the world, particularly on very

National Defence committee  It might be true, but only in the case where nothing is available on the shelf to meet the requirement. In virtually all cases these days, given the way in which the industry has internationalized, in which interoperability has become an important part of military equipment that

National Defence committee  There are many, many economies, of course, by buying off the shelf. In every case where the Department of National Defence can buy an existing piece of equipment that has been tried and true, used by allied services, they will buy off the shelf. It's a very important feature. The

National Defence committee  Yes. In those comments I was basically looking forward, in a world that is changing very rapidly, with a lot of unforseeable crises coming up. It's precisely at that time, if there were a major international crisis and Canada was one of the long lineup of nations waiting to use

National Defence committee  Obviously, it is the Prime Minister and ministers at the cabinet table in our democratic system of government. It is the tradition that they have final responsibility for making decisions, especially decisions that involve the expenditure of billions of dollars of taxpayers' mone

National Defence committee  I know you didn't. But we must be very careful. You hear it often these days. But is it really interference when the cabinet and the Prime Minister exercise their constitutional responsibilities? Certainly there is a risk that they can jump in at the very early stages of the majo

National Defence committee  It's a very interesting question. There is no simple answer. We can't say, of course, that every procurement should take place in three or five years. It depends very much on the particular program. For obvious reasons, the megaprojects, the huge ones, will take longer than the a

National Defence committee  Yes. Allow me to say that the fact that there's disagreement is not surprising, because there has been disagreement over industrial regional benefits. There is no disagreement on the fact that they are important and they are needed. I do not deny that. I'm calling for a more lo

National Defence committee  Yes, I believe it is, Mr. Chairman. I think it is very fair. I think it is very open. It's very transparent. Having been out of the Department of National Defence for something like 18 years, I see no evidence that there is any attempt to colour the results of any evaluation or

National Defence committee  Yes.