Give Canadian firms bigger role in DND contracts: panel

An independent report has produced a number of prescriptions for Canada’s ailing military procurement system, but stops short of suggesting how the Harper government should administer the cures.

The analysis, written by a special advisory panel to Public Works Minister Rona Ambrose, makes a series of recommendations on ways to leverage Canadian industrial participation in billions of dollars in planned defence spending.

But the panel, led by noted businessman Tom Jenkins, didn’t address the fundamental question of whether the country would be better served by leaving defence purchasing to a separate agency, the way it’s handled in Britain and Australia.

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The other option would be for the Harper government to create specialized secretariats, under the umbrella of Public Works, to shepherd each, individual purchase, the way it has done with the troubled F-35 stealth fighter project.

What the panel did was “make a series of principled recommendations of what a secretariat or board would have as its attributes,” Jenkins said Tuesday. “Personally, I’m not particularly persuaded by one or the other.”

In 2008, the Harper government set out an ambitious agenda for re-equipping the military. But the plans have largely floundered amid a series of delays, cost overruns and tightening budgets.

National Defence is currently rewriting its marquee, $490 billion, 20-year defence strategy after discovering that some of the projects outlined five years ago, including the stealth fighter, might not be affordable.

The report suggests, among other things, that Canadian companies should take the lead or play a major role in follow-on support contracts for the billions of dollars in ships, planes and vehicles bought for the Forces.

It says impending U.S. defence cuts represent a threat to Canadian defence exports, but also offer an opportunity for industry to create new, specialized markets.

The report suggests areas where the government could focus its industrial attention and encourage development.

Companies like Montreal-based CAE, which is a world leader in flight simulation technology, were held up as an example of where Canadian companies can position themselves in the world market to serve not only the Canadian military establishment, but other countries as well.

But when it comes to how much the government is willing to invest in the defence industry sector, Ambrose said government is more powerful as a customer than as a subsidizer.

Jenkins said an independent research organization specializing in defence affairs and procurement – modeled on the C.D. Howe Institute – would serve both the government and public well in future debates.

Much of the controversy surrounding the F-35 purchase has revolved around conflicting numbers and views of the stealth fighter, its capabilities and limitations.

A non-partisan institute could serve as an authority, but Jenkins says the recommendation is not a result of the fighter replacement fiasco.

The New Democratic opposition was skeptical of the findings.

Procurement critic Matthew Kellway noted the independent report focused on existing defence spending plans.

But since those plans are already being rewritten, there may be far fewer dollars to spend, he said.


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