By: David Pugliese, Defence Watch
Auditor General Michael Ferguson appeared before the Senate’s defence committee on Tuesday. His presentation, based on an audit of the Army reserves, as well as his answers to questions from senators painted a less than encouraging picture about the situation the Army’s reserve units find themselves in. Here is some of what Ferguson had to say:
-Training of the Army reserve was not fully integrated with that of the regular Army units. Although the Army reserve was given clear guidance on preparing for domestic missions, units did not receive the same level of guidance or how to train troops soldiers for international missions. The Army Reserve doesn’t always have access to the equipment it needed for training and deployments, Ferguson noted.
– Army reserve units are responsible for training their own soldiers. But the AG found that many reserve units didn’t have the number of soldiers they needed. Twelve of the 123 Army reserve units were smaller than half of their ideal size, Ferguson said.
– The Canadian Army provided funding for 21,000 reserve soldiers but only about 14,000 were active and trained. When Army reserve units met in 2105 for their annual, large‑scale collective training events across Canada, only about 3,600 Army Reserve soldiers attended, Ferguson said.
– DND knows that the current reserve recruiting system doesn’t work and that it needs to take steps to boost retention. It has set a goal to increase the Army reserve by 950 soldiers by 2019. But Ferguson said this goal will be difficult to achieve as the number of Army reserve soldiers declined by about 1,000 soldiers a year for the three years his office conducted the audit. Ferguson pointed to the latest numbers provided by DND; as of May 15, 2016, the number of active and trained Army reserve soldiers dropped by a further 1,000 soldiers, to 13,181.
-Ferguson’s audit found that although individual skills training was designed to train the Army reserve and regular army soldiers to the same standard, reserve courses were designed to teach significantly fewer skills than were taught in regular army courses. This skill gap was not always addressed during the pre‑deployment training of Army reserve soldiers, Ferguson pointed out. One example he used was that when Canadian Army soldiers began to deploy as part of NATO’s mission in Eastern Europe, a gap remained in weapons training between Army reserve and regular force soldiers.
-A number of reserve soldiers weren’t receiving the number of days of training that was predicted for them.
-Even if the reserves had all the personnel needed and all of the equipment required, and were doing all of the training, the result would be a severe strain on the existing funds the force has.
-Twenty‑seven per cent of the Army reserve’s existing budget is being spent on full‑time reservists, even though reserves are supposed to be mostly part-time.
-$166 million out of $706 million of their total budget is being allocated back to National Defence to pay for infrastructure.
“What I’m saying is based on everything that we’ve looked at, it is hard for me to sit here and see how they would be able to fund everything they’re supposed to do within the budget that they currently have,” Ferguson told senators. “But certainly it looks to me like it would be a significant challenge for them.”
Showing posts with label CAF Review. Show all posts
Showing posts with label CAF Review. Show all posts
Thursday, September 22, 2016
Thursday, April 21, 2016
Military Procurement can help break Canada’s innovation logjam
By: Christyn Cianfarani, Globe and Mail
Christyn Cianfarani is president of the Canadian Association of Defence and Security Industries
Stimulating innovation in the Canadian economy has proven to be one of the hardest things for governments to achieve. For a generation, most attempts have barely moved the needle.
Christyn Cianfarani is president of the Canadian Association of Defence and Security Industries
Stimulating innovation in the Canadian economy has proven to be one of the hardest things for governments to achieve. For a generation, most attempts have barely moved the needle.
 |
| A worker heads past CCGS Corporal Teather C.V., a Hero-class patrol vessel, at the Irving shipyard in Halifax, on Friday, Oct. 19, 2012. Christyn Cianfarani argues military procurement can help break Canada’s innovation logjam. (Andrew Vaughan/The Canadian Press) |
But a recent idea floated by Navdeep Bains, the Minister of Innovation, Science and Economic Development – namely, using government procurement as a tool to promote innovation – suggests that new thinking is in the air in Ottawa.
For nearly a generation, Canada has followed the standard policy menu to stimulate innovation. Governments have reduced marginal tax rates on business and workers; invested in university-based research, postsecondary education, training/skills development and infrastructure; opened Canada’s markets to international trade and investment; and provided generous research and development tax incentives.
The results have been disappointing. Canada’s productivity growth, which is highly dependent on innovation, remains stagnant, at about 1 per cent a year. New approaches and new policy tools are needed to break this logjam. One such tool is government buying power: procurement. And defence procurement is particularly well suited in this connection.
The defence industry operates in a managed global marketplace in which governments are the main if not sole customers. In the defence market, governments also have policy levers at their disposal and wider discretion to achieve their objectives than in other markets. Defence procurement, for example, is not nearly as constrained by trade agreements as other economic sectors.
For this and other reasons, many of our allies have for decades used military procurement to drive innovation in their economies. The British, U.S., French and Swedish economies, for example, would not be nearly as innovative today had they not approached military procurement with a focus on developing key defence technologies and innovations at home that often to lead to wider commercial applications and then exporting them abroad. Canada has not traditionally been in that game.
But since the 2014 introduction of the federal Defence Procurement Strategy, we have had a new tool in the policy tool box: “Industrial and technological benefits” (ITBs) and, in particular, the “value proposition” part of that program. The value proposition principle can require bidders on defence projects to make commitments to R&D and intellectual property transfer to Canada, both of which are key drivers of innovation. This principle, still in its infancy, needs to be embraced and used systematically and strategically going forward to enhance innovation in Canada’s defence industrial base.
This would not mean creating an innovative domestic defence industry out of nothing. Rather, it is a case of building upon a solid foundation.
A recently completed Innovation, Science and Economic Development/Statistics Canada survey concludes that the Canadian-based defence industry generates 60 per cent of its revenue from exports, which is 20 per cent higher than the overall Canadian manufacturing industry. An export intensity of that magnitude is an indicator of an innovative industry, especially given the highly regulated and protected international marketplace where defence companies operate.
The survey also reported that more than 30 per cent of employment in the Canadian defence industry is concentrated among highly skilled engineers, scientists, researchers, technicians and technologists, and the sector outpaced the overall Canadian manufacturing average in employee compensation, all of which are innovation indicators.
But to really achieve the result the government is looking for, an effort should be made to marry the innovation agenda with the recently announced defence review. Together, these provide the opportunity to make practical changes to improve the process of defence procurement while enhancing innovation.
Canada should take a page from the playbooks of its allies, which have addressed the industrial dimensions of military procurement in their defence reviews. The Australians, for example, have just published a defence white paper accompanied by a defence industrial policy focused on innovation in that sector.
The notion of using government procurement to move beyond the textbook innovation policy menu would be a welcome innovation in and of itself. The test case for this new approach should be the defence sector, in which Ottawa already possesses innovation policy instruments and is less constrained by trade agreements.
Canada’s defence industrial base can be a real source of innovation-led growth over the next few years. All it takes is government and industry working co-operatively and strategically toward that goal.
For nearly a generation, Canada has followed the standard policy menu to stimulate innovation. Governments have reduced marginal tax rates on business and workers; invested in university-based research, postsecondary education, training/skills development and infrastructure; opened Canada’s markets to international trade and investment; and provided generous research and development tax incentives.
The results have been disappointing. Canada’s productivity growth, which is highly dependent on innovation, remains stagnant, at about 1 per cent a year. New approaches and new policy tools are needed to break this logjam. One such tool is government buying power: procurement. And defence procurement is particularly well suited in this connection.
The defence industry operates in a managed global marketplace in which governments are the main if not sole customers. In the defence market, governments also have policy levers at their disposal and wider discretion to achieve their objectives than in other markets. Defence procurement, for example, is not nearly as constrained by trade agreements as other economic sectors.
For this and other reasons, many of our allies have for decades used military procurement to drive innovation in their economies. The British, U.S., French and Swedish economies, for example, would not be nearly as innovative today had they not approached military procurement with a focus on developing key defence technologies and innovations at home that often to lead to wider commercial applications and then exporting them abroad. Canada has not traditionally been in that game.
But since the 2014 introduction of the federal Defence Procurement Strategy, we have had a new tool in the policy tool box: “Industrial and technological benefits” (ITBs) and, in particular, the “value proposition” part of that program. The value proposition principle can require bidders on defence projects to make commitments to R&D and intellectual property transfer to Canada, both of which are key drivers of innovation. This principle, still in its infancy, needs to be embraced and used systematically and strategically going forward to enhance innovation in Canada’s defence industrial base.
This would not mean creating an innovative domestic defence industry out of nothing. Rather, it is a case of building upon a solid foundation.
A recently completed Innovation, Science and Economic Development/Statistics Canada survey concludes that the Canadian-based defence industry generates 60 per cent of its revenue from exports, which is 20 per cent higher than the overall Canadian manufacturing industry. An export intensity of that magnitude is an indicator of an innovative industry, especially given the highly regulated and protected international marketplace where defence companies operate.
The survey also reported that more than 30 per cent of employment in the Canadian defence industry is concentrated among highly skilled engineers, scientists, researchers, technicians and technologists, and the sector outpaced the overall Canadian manufacturing average in employee compensation, all of which are innovation indicators.
But to really achieve the result the government is looking for, an effort should be made to marry the innovation agenda with the recently announced defence review. Together, these provide the opportunity to make practical changes to improve the process of defence procurement while enhancing innovation.
Canada should take a page from the playbooks of its allies, which have addressed the industrial dimensions of military procurement in their defence reviews. The Australians, for example, have just published a defence white paper accompanied by a defence industrial policy focused on innovation in that sector.
The notion of using government procurement to move beyond the textbook innovation policy menu would be a welcome innovation in and of itself. The test case for this new approach should be the defence sector, in which Ottawa already possesses innovation policy instruments and is less constrained by trade agreements.
Canada’s defence industrial base can be a real source of innovation-led growth over the next few years. All it takes is government and industry working co-operatively and strategically toward that goal.
Thursday, April 7, 2016
CADSI extends support to Canada’s Defence Review
Published by: Frontline Defence News
Christyn Cianfarani, president of the Canadian Association of Defence and Security Industries (CADSI), has issued the following statement pledging CADSI's support and expertise to the advisory panel to Canada’s Defence Review:
The Canadian Association of Defence and Security Industries (CADSI) welcomes the launch of Canada’s Defence Review and looks forward to being consulted by the Minister of Defence’s advisory panel. Our 1,000 member companies are an important part of the solution with global expertise to contribute.
The ability of the Government and the Canadian Armed Forces (CAF) to effectively implement Canada’s new defence policy is dependent on procuring the equipment and services the CAF needs to carry out its missions. Improving the process of defence procurement is therefore an essential part of developing an effective defence policy.
Canada’s defence industry has unsurpassed knowledge and expertise in procurement. We work with the system in Canada and across the world every day and at every level. We can speak to practical improvements to procurement to ensure the efficacy of a new defence policy developed through the Defence Review.
Our industry plays an essential role in our nation’s security and sovereignty by ensuring ongoing readiness of existing and building new capabilities with world class, innovative technologies made across Canada and sought the world over. The Canadian defence industry and Canada’s defence policy are interdependent and need to be considered as such in the Defence Review.
Christyn Cianfarani, president of the Canadian Association of Defence and Security Industries (CADSI), has issued the following statement pledging CADSI's support and expertise to the advisory panel to Canada’s Defence Review:
The Canadian Association of Defence and Security Industries (CADSI) welcomes the launch of Canada’s Defence Review and looks forward to being consulted by the Minister of Defence’s advisory panel. Our 1,000 member companies are an important part of the solution with global expertise to contribute.
The ability of the Government and the Canadian Armed Forces (CAF) to effectively implement Canada’s new defence policy is dependent on procuring the equipment and services the CAF needs to carry out its missions. Improving the process of defence procurement is therefore an essential part of developing an effective defence policy.
Canada’s defence industry has unsurpassed knowledge and expertise in procurement. We work with the system in Canada and across the world every day and at every level. We can speak to practical improvements to procurement to ensure the efficacy of a new defence policy developed through the Defence Review.
Our industry plays an essential role in our nation’s security and sovereignty by ensuring ongoing readiness of existing and building new capabilities with world class, innovative technologies made across Canada and sought the world over. The Canadian defence industry and Canada’s defence policy are interdependent and need to be considered as such in the Defence Review.
Tuesday, March 8, 2016
Public input unlikely to alter Liberal CAF Vision
Written by: John Ivision, National Post
Within days, Def ence Minister Harjit Sajjan will launch public consultations on the new review that will mandate the future size of the Canadian Forces, what kind of equipment they will use and the theatres in which they will operate.
Within days, Def ence Minister Harjit Sajjan will launch public consultations on the new review that will mandate the future size of the Canadian Forces, what kind of equipment they will use and the theatres in which they will operate.
In tandem with the upcoming defence review, the Department of National Defence will issue a new statement of requirement for the CF-18 fighter jet replacement. Insiders suggest the campaign pledge not to buy Lockheed Martin’s F-35 remains, John Ivison writes, which means it looks like Canada will end up choosing Boeing’s Super Hornet.
The goal is to have the feedback process wrapped up by June 30 and the whole defence review signed, sealed and delivered by the end of the year, just in time for the 2017 budget.
The degree of haste suggests there won’t be much weight placed in those consultations because the Liberals already have a pretty good idea what they want — as the election platform detailed, a “leaner, more agile” military that can defend Canada and North America; can provide support during natural disasters; can offer humanitarian support missions and peacekeeping operations; and (last and, apparently, least) has a degree of combat capability.
In tandem with the defence review, Sajjan’s department will issue a new statement of requirement for the CF-18 fighter jet replacement. Insiders suggest the campaign commitment not to buy Lockheed Martin’s F-35 remains written in stone, even if it’s not clear how you conduct an open and transparent tender process while barring one competitor.
There are two or three European fighter jet options available to the air force, but government officials concede it will be problematic to buy a plane not operated by Canada’s NORAD ally, the U.S. So, it looks as if we will have a lengthy, expensive competition that will end up choosing Boeing’s Super Hornet.
In their campaign platform, the Liberals said they would buy a cheaper option than the F-35 and re-direct the savings to the navy, since there is not enough money left in the capital spending pot to fund all the ships on order under the Canadian Surface Combatant program.
But the only way significant savings are likely to manifest is if the Forces buy a far smaller fleet than the 65 jets planned in the original F-35 contract.
That might be exactly what the Liberals envisage.
The party’s election platform suggested Canada will no longer participate in the kind of air-to-ground campaigns we witnessed in Iraq. If we are no longer in the business of sending our jets overseas, and their sole focus is on continental defence, we can afford a far smaller fleet.
The platform also committed to implement the recommendations of the 2011 Report on Transformation, a controversial effort led by none other than the current Liberal whip and former lieutenant-general, Andrew Leslie.
While the platform is explicit in endorsing Leslie’s road map to a more “modern, efficient and effective military” — less tail, more teeth — mention of the report was conspicuous by its absence in Sajjan’s mandate letter.
Leslie appears to have known his recommendations to reduce headquarters overheads, including the $2.7 billion spent annually on consultants and contractors, would face resistance.
“Very few of the recommendations to get where we think we have to go will be easy, popular or risk free,” he wrote.
He concluded with a quote from Machiavelli: “The innovators have for enemies all those who have done well under the old conditions.”
But he did not perhaps anticipate the virulence with which the advocates for the status quo would fight back against his call to fundamentally restructure the Canadian Forces.
It seems the uniforms, whose livelihoods may have been impacted by the recommendation the Forces adopt a single, streamlined command structure, are still fighting.
People familiar with the current review say many of Leslie’s suggestions for addressing the bloating bureaucracy (the tail grew by 40 per cent from 2004 to 2010; operational or deployable jobs by 10 per cent) are not likely to see the light of day.
Yet “leaner and more agile” — even smaller — may not necessarily be a bad thing. Rick Hillier, the former chief of the defence staff, has advocated reducing the size of the military as the only way to ensure it remains strong and stable. He has said the number of fulltime members could fall to about 50,000 from the current 66,000.
An internal Department of National Defence review conducted by the Conservative government also recommended cutting one infantry company from each of Canada’s nine battalions.
The Conservatives failed to act on that recommendation, having criticized the Liberals for ushering in a military “decade of darkness” under Jean Chrétien.
For the same reason, the Trudeau government is likely to be nervous about reducing head count.
But the crucial metric is budget. As David Perry at the Canadian Global Affairs Institute points out, the Liberals promised to find $3 billion in savings in an expenditure review during the election.
If the defence review is geared to finding savings that are re-invested in new capability areas such as space and cyberspace, a reduction in numbers may be politically marketable.
But if it turns out to be a cash grab, designed to free up funds to flow back into general revenues and fluff the deficit, the Liberals will deserve all the opprobrium that comes their way.
Whatever the granular detail, it seems certain Canada will emerge with military more geared to fighting famine than war.
The goal is to have the feedback process wrapped up by June 30 and the whole defence review signed, sealed and delivered by the end of the year, just in time for the 2017 budget.
The degree of haste suggests there won’t be much weight placed in those consultations because the Liberals already have a pretty good idea what they want — as the election platform detailed, a “leaner, more agile” military that can defend Canada and North America; can provide support during natural disasters; can offer humanitarian support missions and peacekeeping operations; and (last and, apparently, least) has a degree of combat capability.
In tandem with the defence review, Sajjan’s department will issue a new statement of requirement for the CF-18 fighter jet replacement. Insiders suggest the campaign commitment not to buy Lockheed Martin’s F-35 remains written in stone, even if it’s not clear how you conduct an open and transparent tender process while barring one competitor.
There are two or three European fighter jet options available to the air force, but government officials concede it will be problematic to buy a plane not operated by Canada’s NORAD ally, the U.S. So, it looks as if we will have a lengthy, expensive competition that will end up choosing Boeing’s Super Hornet.
In their campaign platform, the Liberals said they would buy a cheaper option than the F-35 and re-direct the savings to the navy, since there is not enough money left in the capital spending pot to fund all the ships on order under the Canadian Surface Combatant program.
But the only way significant savings are likely to manifest is if the Forces buy a far smaller fleet than the 65 jets planned in the original F-35 contract.
That might be exactly what the Liberals envisage.
The party’s election platform suggested Canada will no longer participate in the kind of air-to-ground campaigns we witnessed in Iraq. If we are no longer in the business of sending our jets overseas, and their sole focus is on continental defence, we can afford a far smaller fleet.
The platform also committed to implement the recommendations of the 2011 Report on Transformation, a controversial effort led by none other than the current Liberal whip and former lieutenant-general, Andrew Leslie.
While the platform is explicit in endorsing Leslie’s road map to a more “modern, efficient and effective military” — less tail, more teeth — mention of the report was conspicuous by its absence in Sajjan’s mandate letter.
Leslie appears to have known his recommendations to reduce headquarters overheads, including the $2.7 billion spent annually on consultants and contractors, would face resistance.
“Very few of the recommendations to get where we think we have to go will be easy, popular or risk free,” he wrote.
He concluded with a quote from Machiavelli: “The innovators have for enemies all those who have done well under the old conditions.”
But he did not perhaps anticipate the virulence with which the advocates for the status quo would fight back against his call to fundamentally restructure the Canadian Forces.
It seems the uniforms, whose livelihoods may have been impacted by the recommendation the Forces adopt a single, streamlined command structure, are still fighting.
People familiar with the current review say many of Leslie’s suggestions for addressing the bloating bureaucracy (the tail grew by 40 per cent from 2004 to 2010; operational or deployable jobs by 10 per cent) are not likely to see the light of day.
Yet “leaner and more agile” — even smaller — may not necessarily be a bad thing. Rick Hillier, the former chief of the defence staff, has advocated reducing the size of the military as the only way to ensure it remains strong and stable. He has said the number of fulltime members could fall to about 50,000 from the current 66,000.
An internal Department of National Defence review conducted by the Conservative government also recommended cutting one infantry company from each of Canada’s nine battalions.
The Conservatives failed to act on that recommendation, having criticized the Liberals for ushering in a military “decade of darkness” under Jean Chrétien.
For the same reason, the Trudeau government is likely to be nervous about reducing head count.
But the crucial metric is budget. As David Perry at the Canadian Global Affairs Institute points out, the Liberals promised to find $3 billion in savings in an expenditure review during the election.
If the defence review is geared to finding savings that are re-invested in new capability areas such as space and cyberspace, a reduction in numbers may be politically marketable.
But if it turns out to be a cash grab, designed to free up funds to flow back into general revenues and fluff the deficit, the Liberals will deserve all the opprobrium that comes their way.
Whatever the granular detail, it seems certain Canada will emerge with military more geared to fighting famine than war.
Monday, December 7, 2015
Canadian Defence Review - What Needs to be Reviewed
During the Speech from the Throne last Friday, Justin Trudeau's Liberal Majority Government had little to say on Defence - the few short sentences mentioned little to no specifics.
Here is the text relating to the CAF from the Throne Speech:
"...To contribute to greater peace throughout the world, the Government will renew Canada's commitment to United Nations peacekeeping operations, and will continue to work with its allies in the fight against terrorism.
To keep Canadians safe and be ready to respond when needed, the Government will launch an open and transparent process to review existing defence capabilities, and will invest in building a leaner, more agile, better-equipped military."
Here is the text relating to the CAF from the Throne Speech:
"...To contribute to greater peace throughout the world, the Government will renew Canada's commitment to United Nations peacekeeping operations, and will continue to work with its allies in the fight against terrorism.
To keep Canadians safe and be ready to respond when needed, the Government will launch an open and transparent process to review existing defence capabilities, and will invest in building a leaner, more agile, better-equipped military."
What does that all mean?
We know that during the 2015 Federal Election the Liberals promised to withdraw from the Aireal Bombing Campaign against ISIS; scrap the F-35 Purchase; ensure the Navy got the Vessels it needs; and return to more Peacekeeping missions. Only one of these things was mentioned in the Throne Speech. As Rona Ambrose, the Leader of the Official Opposition pointed out following the reading, the Speech doesn't even mention ISIS.
Let's take a look a a few things within the CAF that need a review;
1. The Budget
Under the previous Liberal Government of Jean Chretien - the CAF called the 1990s the "Decade of Darkness." This is not all that far off from what is was. The Chretien Government cut defence spending 25% from $12 billion in 1993 to $9.4B in 1998; cut troop levels from 74,000 to below 60,000; while at the same time deploying CAF members on almost every UN Peacekeeping mission that came up.
Some of these Missions were highly required; and were laden with heavy burdens for the CAF. One of these missions was the 2000-03 deployment to Ethiopia and Eritrea. Under OP ECLIPSE and OP ADDITION, CAF equipment was hit by a great tole of wear and tare.
During the same time, Canada deployed to Afghanistan in 2002 - which led to a stretching of CAF personnel, when retention within the CAF became a huge problem. All while the CAF was facing a nearly $15 billion equipment shortfall.
This all helped the 2006 Conservative victory with their "Stand Up for Canada" campaign, followed by their Canada First Defence Strategy (CFDS) in 2008. The Conservatives made jokes about the Liberal Parties management of the CAF; heavily called them out on deploying the CAF to arid (desert-like) climates in temperate (forest) camouflage. The Conservatives also vowed to move beyond the operational "Tokenism" of peacekeeping, and allow Canada to make a substantial contribution to international security.
Was the Conservative's decade all that much better? If we take a closer look; the period from 2006-2009 can almost be called "Golden Years" for the CAF. In 2006 the Conservatives quickly announced $17 Billion worth of procurement projects. The CAF would be shopping for:
- 3 Joint Support Ships;
- 6-8 Arctic Offshore Patrol Ships;
- 4 C-17 Strategic Lift Aircraft; and
- 17 C-130 Tactical Transport Aircarft
These were just to start the revitalization of the CAF. The Government at the time also announced an increase to $14.5 Billion.
Then came the CFDS - which outlined a 20-year funding formula that would increase defence spending 2% from 2008 until 2028. In real terms, the Budget would increase from $18 Billion (2008) to $30 Billion (*2028 Projection) - an increase of $490 Billion over two decades; of which nearly $50 billion would be for equipment acquisitions. The Government would increase the regular force back to over 70,000 and increase the reserves to 30,000.
Added to the list of procurements for the CAF were:
- 65 "Next-Generation" Fighter Jets to replace the CF-18s;
- 100 Leopard-II Tanks;
- 17 Fixed-Wing Search and Rescue Aircraft to replace the Buffalo aircraft;
- 15 Canadian Surface Combatant (CSC) Warships to revitalize the Royal Canadian Navy;
- 10 to 12 Maritime Patrol Aircaft; and
- A fleet (100+) close combat armored vehicles.
Up until 2010-2011 the Conservative Government largely followed the CFDS - the budget had increased nearly 24%. The CAF had received:
- 3 C-17 Aircraft;
- Dozens of new C-130's;
- Numerous new or leased tanks;
- Numerous M-777 howitzers; and
- purchased Chinook Strategic Lift Helicopters
While these successes seem all well and good - the other procurement plans; particularly the replacement of the entire Naval fleet was on hold. This was partly because of cost overruns in the planning, and development stage of the National Ship Building Plan (NSBP) - it was largely the fault of Afghanistan that everything else was put on hold.
With the Afghan War (2001-2014) the army rightly became the priority; meaning a vast majority of procurement funds were being diverted into its needs. $1.3 Billion was used for the Leopard II tanks; the Parliamentary Budget put the total coast of Afghanistan at $18 Billion through 2011.
At the closing of the stimulous spending in the 2012 Budget, 1/5 of all savings were to come from Defence; and by 2014, 1/4 of all savings came out of Defence. This effectively made CFDS unusable.
From its height in 2011, Defence spending was at $22 Billion, but by 2013, that had dropped to $19 Billion; and when adjusted for inflation it was approimatly the same as it was in 2005 before the Conservatives took power. As a percentage of GDP, it stood at 1.1% (the same level as it was during the "Decade of Darkness")
With these cuts, most projects are underfunded - and on the rails of collapse. The CSC Ships are at least $15 Billion short - and the Navy is estimating it will only get 8 Vessels instead of the needed 15. As a stopgap measure, the CAF is spending $4.2 Billion on upgrades to the Halifax-class frigates to keep them operational until the CSC Fleet is ready (between 2025-2035); another $1.2 Billion to upgrade its current light armored vehicles; and $100 million on a second round of upgrades to the 77 CF-18's still flying; and will spend $500 million to lease a retrofitted boxship that will be made into an interim auxiliary oil replenishment ship (iAOR).
So a major review of the overall Defence budget is required. The Liberal Government has said it will withdraw from the JSF F-35 program which was going to cost nearly $16 Billion for 65 Fighters (including life cycle management costs) and find a cheaper alternative, while moving the saved funds into the CSC Fleet program. The FWSAR aircraft contract has not yet been awarded, and neither has the Maritime Patrol Aircraft contracts. The Liberals will need to be willing to put enough money into Defence to restore the CAF to pre-Afghan War equipment readiness levels. The CAF gained a great deal of experience in Afghanistan, but its equipment got worn out and needs to be replaced.
A Defence review must show that Defence needs more Money; as the Parliamentary Budget Officer believes that just on Procurement, the CAF is short between $33-$42 Billion (November 2015 figures).
"This gap must be addressed if the government hopes to recapitalize the CAF, maintain the current force structure, and ensure defence sustainability. This paper will explore some of the short- and long-term challenges currently facing the CAF, from capability gaps to recapitalization, and assess some of the Liberal promises to fix these problems. It concludes with some thoughts on the need to recalibrate defence resource allocations." (McDonough)
With the Afghan War (2001-2014) the army rightly became the priority; meaning a vast majority of procurement funds were being diverted into its needs. $1.3 Billion was used for the Leopard II tanks; the Parliamentary Budget put the total coast of Afghanistan at $18 Billion through 2011.
At the closing of the stimulous spending in the 2012 Budget, 1/5 of all savings were to come from Defence; and by 2014, 1/4 of all savings came out of Defence. This effectively made CFDS unusable.
From its height in 2011, Defence spending was at $22 Billion, but by 2013, that had dropped to $19 Billion; and when adjusted for inflation it was approimatly the same as it was in 2005 before the Conservatives took power. As a percentage of GDP, it stood at 1.1% (the same level as it was during the "Decade of Darkness")
With these cuts, most projects are underfunded - and on the rails of collapse. The CSC Ships are at least $15 Billion short - and the Navy is estimating it will only get 8 Vessels instead of the needed 15. As a stopgap measure, the CAF is spending $4.2 Billion on upgrades to the Halifax-class frigates to keep them operational until the CSC Fleet is ready (between 2025-2035); another $1.2 Billion to upgrade its current light armored vehicles; and $100 million on a second round of upgrades to the 77 CF-18's still flying; and will spend $500 million to lease a retrofitted boxship that will be made into an interim auxiliary oil replenishment ship (iAOR).
So a major review of the overall Defence budget is required. The Liberal Government has said it will withdraw from the JSF F-35 program which was going to cost nearly $16 Billion for 65 Fighters (including life cycle management costs) and find a cheaper alternative, while moving the saved funds into the CSC Fleet program. The FWSAR aircraft contract has not yet been awarded, and neither has the Maritime Patrol Aircraft contracts. The Liberals will need to be willing to put enough money into Defence to restore the CAF to pre-Afghan War equipment readiness levels. The CAF gained a great deal of experience in Afghanistan, but its equipment got worn out and needs to be replaced.
A Defence review must show that Defence needs more Money; as the Parliamentary Budget Officer believes that just on Procurement, the CAF is short between $33-$42 Billion (November 2015 figures).
"This gap must be addressed if the government hopes to recapitalize the CAF, maintain the current force structure, and ensure defence sustainability. This paper will explore some of the short- and long-term challenges currently facing the CAF, from capability gaps to recapitalization, and assess some of the Liberal promises to fix these problems. It concludes with some thoughts on the need to recalibrate defence resource allocations." (McDonough)
 |
| From Maclean's Magazine Defence Issue during the 2015 Election. |
2. Procurement
Procurement has largely been a joke in the CAF for many years, plagued by an over complex bureaucracy - projects have been started, and cancelled multiple time costing taxpayers millions of dollars. The Procurement process needs to be simplified while ensuring the correct and needed equipment is purchased in a timely manner at an appropriate cost.
Here is a list of current projects and their overruns:
Procurement has largely been a joke in the CAF for many years, plagued by an over complex bureaucracy - projects have been started, and cancelled multiple time costing taxpayers millions of dollars. The Procurement process needs to be simplified while ensuring the correct and needed equipment is purchased in a timely manner at an appropriate cost.
Here is a list of current projects and their overruns:
- Arctic Off Shore Patrol Ships - Cost: $3.1 Billion for 6 to 8 Ships, the first delivery was expected in 2013 - it is now not expected until 2021; with the final ship in 2025. In all likely hood, only 6 will be built.
- Maritime Patrol Aircraft - Cost: $7 Bullion for 10 to 12 Aircraft. Delivery was supposed to take place in 2020 - but current fiscal restraints has the contract date not until 2025, with delivery taking place between 2026 and 2035. Instead the RCAF is spending $2 Billion to upgrade its 14 CP-140 Aurora's.
- Canadian Surface Combatant Fleet - Cost: $29 Billion (Estimated to be at least $14 Billion short). Original first delivery date was between 2016 and 2017; especially for the Joint Support Ships (AORs) but all dates now between 2021 and 2035. (This includes the JSS Contracts)
- CF-18 Replacement Program - Cost $17 Billion (Estimate based on F-35 Purchase). Fleet was supposed to be replaced by 2017. CF-18s currently undergoing 2nd Life extension plan to keep the fleet flying until at least 2020, with delivery of new aircraft not expected until between 2025 and 2035.
- Close Combat Vehicles - Cost: $2.1 Billion - Project Cancelled in 2013 due to Financial Restraints.
- FWSAR Aircraft - Cost: $1.4 Billion - Original Delivery Date was 2014-2015. There has been no contract awarded, it is expected in early 2016, with delivery between 2021 and 2025.
- UAV Program - Cost: $1.5 Billion - Original Delivery Date was 2011 - now not expected until between 2021 and 2025.
- LAV III Life Extension Program - Cost: $1.2 Billion - Expected completion 2018.
- Maritime Helicopter Program - Cost: $5.7 Billion - Replacement of the Sea King Helicopters. Program was started in 2004, with delivery in 2008. Was later cancelled and restarted. Now deliveries started in 2015 but full operational status not expected until 2018, and final delivery in 2020.
- Medium Support Vehicles (1,500 Military Pattern Trucks) - Cost: $1.2 Billion. The Program has been cancelled twice since 2006. Original delivery was set between 2008 and 2010. Contract was due in 2015 and delivery between 2017 and 2018.
- Medium Heavy Lift Helicopters - Cost: $4.9 Billion. 15 of 16 Planned were purchased; but 5 years later than originally scheduled. Last was delivered in 2014.
- Tactical Armoured Patrol Vehicle - Cost: $708 Million for 500 vehicles. Contract was awarded in 2012 with deliveries expected in 2014. Problems with the design of the vehicle has post postponed deliveries until at least 2016.
A Defence review must show that Defence to simplify the procurement process, and increase the amount of currency available for these projects. As delays run longer, it is inevitable these programs will cost even more.
3. Peacekeeping and Staffing Levels
If the Liberal Government plans to return Canada to it's global Peacekeeping Role, both Procurement and the Budget need to be fixed first. The more missions you deploy on, the greater amount of the Defence budget is spent on Deployment costs (higher wages, shipping, and equipment). Equipment breaks in theater, and it is often cheaper to scrap the equipment in theater than ship it home to repair it. The more missions, the more equipment you need to have to deploy in the first place.
So before you can deploy on a greater number of UN mandated missions, you need to resupply and re-arm the CAF; which means more Money. You also need to work on increasing staffing levels, which inevitably, you guessed it - costs more money. The more deployment CAF personnel go on, the higher number of retirements from the CAF - so retention then becomes an issue.
These are the three things that I believe need a review in the Canadian Defence World. What do you think?
Sources:
Collins, Jeffrey F. "Reviving and Revising the Canada First Defence Strategy." (November 2014) http://www.c2cjournal.ca/2014/11/reviving-and-revising-the-canada-first-defence-strategy/#
Maclean's Magazine: "Election Issues 2015: A Maclean's Primer on Defence Spending" (August, 2 2015) http://www.macleans.ca/politics/ottawa/defence-primer/
McDonough, David. "Procurement Challenges for the New Liberal Government." CDA Institute Vimy Paper November 2015. http://www.cdainstitute.ca/images/Analysis/McDonough_Analysis_November_2015.pdf
Perry, David. "The Growing Gap Between Defence End and Means." CDA Institute Vimy Paper June 2014. https://www.cdainstitute.ca/images/PerryBudgetJune2014.pdf
If the Liberal Government plans to return Canada to it's global Peacekeeping Role, both Procurement and the Budget need to be fixed first. The more missions you deploy on, the greater amount of the Defence budget is spent on Deployment costs (higher wages, shipping, and equipment). Equipment breaks in theater, and it is often cheaper to scrap the equipment in theater than ship it home to repair it. The more missions, the more equipment you need to have to deploy in the first place.
So before you can deploy on a greater number of UN mandated missions, you need to resupply and re-arm the CAF; which means more Money. You also need to work on increasing staffing levels, which inevitably, you guessed it - costs more money. The more deployment CAF personnel go on, the higher number of retirements from the CAF - so retention then becomes an issue.
These are the three things that I believe need a review in the Canadian Defence World. What do you think?
Sources:
Collins, Jeffrey F. "Reviving and Revising the Canada First Defence Strategy." (November 2014) http://www.c2cjournal.ca/2014/11/reviving-and-revising-the-canada-first-defence-strategy/#
Maclean's Magazine: "Election Issues 2015: A Maclean's Primer on Defence Spending" (August, 2 2015) http://www.macleans.ca/politics/ottawa/defence-primer/
McDonough, David. "Procurement Challenges for the New Liberal Government." CDA Institute Vimy Paper November 2015. http://www.cdainstitute.ca/images/Analysis/McDonough_Analysis_November_2015.pdf
Perry, David. "The Growing Gap Between Defence End and Means." CDA Institute Vimy Paper June 2014. https://www.cdainstitute.ca/images/PerryBudgetJune2014.pdf
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