Fighter jet fiasco indicative of bureaucratic procurement system: Senator Eaton
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Canada was a founding member of the Joint Strike Fighter program, the U.S.-led consortium with Lockheed Martin to develop the F-35 fighter jet, back in 1997. The government of Australia joined the program five years later.
On December 10, 2018, two F-35s arrived at the Royal Australian Air Force's Williamstown base. They go along with eight other F-35s received by the RAAF, which are currently stationed at the F-35 training centre in Arizona. In total, Australia will receive 72 F-35s as it retires its 35-year-old F-18 fleet by the end of 2023.
And what of Joint Strike Fighter founding member, Canada? Our federal government recently finalized a deal to buy 25 well-used F-18s from Australia — 18 to fly and seven for spare parts.
As we take possession of Australia's scrap, Canada is in the early stages of a minimum five-year-long process to pick a replacement for the F-18, which will be more than 50 years old before it is retired in the 2030s.
We will spend billions to extend the life cycle of a jet the auditor general says, "Will be disadvantaged against many potential adversaries … Threats to the CF-18 would have to be reduced or destroyed by allies before the CF-18 could operate in certain environments, which would limit Canada's contribution to NORAD and NATO operations."
The fiasco of fighter jet replacement is the best example of a procurement system that is cumbersome, bureaucratic and beset by political interference.
Canadian pilots could be training on next-generation aircraft now if not for an ill-advised promise to scrap the planned purchase of the F-35, made by Justin Trudeau as the leader of the third party prior to the 2015 federal election. Instead, the Air Force is stuck with aging jets with limited capabilities and pilots are leaving the RCAF at an alarming rate.
Similar delays are plaguing the $60-billion project to replace Canada's warships with the regrettable consequence that the Irving Shipyard in Halifax is likely to have a significant gap between the completion of the Arctic offshore patrol vessels and the commencement of the surface combatant project. Similar gaps have emerged in the construction of non-combat vessels at the Seaspan yard in Vancouver.
The consequences of these time lags will be rising costs and an inability to retain skilled workers.
I believe the current government is to blame for some of the problems, particularly poor project management and its politicization of the fighter jet replacement. Nevertheless, military procurement has bedeviled successive governments, Liberal and Conservative alike.
That's why I requested the Senate's National Finance Committee, of which I am a member, to study military procurement. The study started before Christmas and will conclude this year.
Political interference, not just for partisan advantage but also due to regional turf protection (we'll hear more of this as the Mark Norman case proceeds, I suspect) bears some of the blame.
The procurement process is expected to serve multiple objectives: delivering the right equipment to the Canadian Armed Forces in a timely and cost-effective manner on the one hand, and providing industrial and technological benefits to the economy on the other.
I support both of these objectives. There are good reasons to build military-industrial capability for regional development and to save costs for maintaining and updating the equipment. But it would be naïve to pretend those objectives don't conflict on occasion.
However, I think the main reason for paralysis in military procurement in Canada is it is too cumbersome and bureaucratic. Process is paramount and results are secondary.
There are layers of committees, depending on the size of the project, with membership from Public Services and Procurement Canada, National Defence, and Innovation, Science and Economic Development.
The consensus-based decision-making process on which these committees operate is supposed to avoid a big mistake — no doubt an appealing quality for a risk-averse bureaucracy, but the downside is the system is not conducive to fast action.
Simply put, the buck stops nowhere.
The consequences are clear, when comparing the federal government's objectives in its June 2017 defence policy “Strong, Secure, Engaged” with what has been delivered.
In the last fiscal year, the policy projected capital spending of $6.1 billion, yet only $3.7 billion was spent. This year, $6.55 billion is called for under SSE, but total appropriations to date amount to $4 billion.
Given this poor track record, the idea that military spending can be cranked up by 70% over 10 years, as envisioned in Strong, Secure, Engaged, looks increasingly fanciful.
Unless ministers start to devote close attention to the management of major projects, or until the process is overhauled, Canadians can continue to expect poor outcomes and wasted taxpayer dollars.
The Honourable Nicole Eaton is a former senator. For more information, please refer to the Library of Parliament Archives.
This article appeared in the January 21, 2019 edition of The Hill Times.
Canada was a founding member of the Joint Strike Fighter program, the U.S.-led consortium with Lockheed Martin to develop the F-35 fighter jet, back in 1997. The government of Australia joined the program five years later.
On December 10, 2018, two F-35s arrived at the Royal Australian Air Force's Williamstown base. They go along with eight other F-35s received by the RAAF, which are currently stationed at the F-35 training centre in Arizona. In total, Australia will receive 72 F-35s as it retires its 35-year-old F-18 fleet by the end of 2023.
And what of Joint Strike Fighter founding member, Canada? Our federal government recently finalized a deal to buy 25 well-used F-18s from Australia — 18 to fly and seven for spare parts.
As we take possession of Australia's scrap, Canada is in the early stages of a minimum five-year-long process to pick a replacement for the F-18, which will be more than 50 years old before it is retired in the 2030s.
We will spend billions to extend the life cycle of a jet the auditor general says, "Will be disadvantaged against many potential adversaries … Threats to the CF-18 would have to be reduced or destroyed by allies before the CF-18 could operate in certain environments, which would limit Canada's contribution to NORAD and NATO operations."
The fiasco of fighter jet replacement is the best example of a procurement system that is cumbersome, bureaucratic and beset by political interference.
Canadian pilots could be training on next-generation aircraft now if not for an ill-advised promise to scrap the planned purchase of the F-35, made by Justin Trudeau as the leader of the third party prior to the 2015 federal election. Instead, the Air Force is stuck with aging jets with limited capabilities and pilots are leaving the RCAF at an alarming rate.
Similar delays are plaguing the $60-billion project to replace Canada's warships with the regrettable consequence that the Irving Shipyard in Halifax is likely to have a significant gap between the completion of the Arctic offshore patrol vessels and the commencement of the surface combatant project. Similar gaps have emerged in the construction of non-combat vessels at the Seaspan yard in Vancouver.
The consequences of these time lags will be rising costs and an inability to retain skilled workers.
I believe the current government is to blame for some of the problems, particularly poor project management and its politicization of the fighter jet replacement. Nevertheless, military procurement has bedeviled successive governments, Liberal and Conservative alike.
That's why I requested the Senate's National Finance Committee, of which I am a member, to study military procurement. The study started before Christmas and will conclude this year.
Political interference, not just for partisan advantage but also due to regional turf protection (we'll hear more of this as the Mark Norman case proceeds, I suspect) bears some of the blame.
The procurement process is expected to serve multiple objectives: delivering the right equipment to the Canadian Armed Forces in a timely and cost-effective manner on the one hand, and providing industrial and technological benefits to the economy on the other.
I support both of these objectives. There are good reasons to build military-industrial capability for regional development and to save costs for maintaining and updating the equipment. But it would be naïve to pretend those objectives don't conflict on occasion.
However, I think the main reason for paralysis in military procurement in Canada is it is too cumbersome and bureaucratic. Process is paramount and results are secondary.
There are layers of committees, depending on the size of the project, with membership from Public Services and Procurement Canada, National Defence, and Innovation, Science and Economic Development.
The consensus-based decision-making process on which these committees operate is supposed to avoid a big mistake — no doubt an appealing quality for a risk-averse bureaucracy, but the downside is the system is not conducive to fast action.
Simply put, the buck stops nowhere.
The consequences are clear, when comparing the federal government's objectives in its June 2017 defence policy “Strong, Secure, Engaged” with what has been delivered.
In the last fiscal year, the policy projected capital spending of $6.1 billion, yet only $3.7 billion was spent. This year, $6.55 billion is called for under SSE, but total appropriations to date amount to $4 billion.
Given this poor track record, the idea that military spending can be cranked up by 70% over 10 years, as envisioned in Strong, Secure, Engaged, looks increasingly fanciful.
Unless ministers start to devote close attention to the management of major projects, or until the process is overhauled, Canadians can continue to expect poor outcomes and wasted taxpayer dollars.
The Honourable Nicole Eaton is a former senator. For more information, please refer to the Library of Parliament Archives.
This article appeared in the January 21, 2019 edition of The Hill Times.