View from the floor: Spending less, spending more on defence

When it comes to sourcing new equipment for Canada’s armed forces this year, finding a coherent strategy from National Defence, the federal government or from industry is close to impossible.

Over land, on the sea and in the air, deciding what the country needs to defend itself has never been so muddled. Shipyards on both coasts are preparing to build much-needed vessels for our Navy and Coast Guard, but still with inadequate resources for Northern sovereignty patrol.

The Army will not be receiving the “close combat” vehicles National Defence spent years developing and sourcing, because they’re already obsolete and we’re out of IED-infested Afghanistan. The Joint Strike Fighter or F-35 is so expensive, no one even knows how much the program will cost, sending the Feds “back to the drawing board” with no other aircraft to fill the requirement, mainly because the RFP was written around the F-35’s unique stealth capability.

Add to this deep budget cutting (cadets have been told to bring their own parkas for winter training) and it’s a wonder the military can afford boots, let alone function as a ready force. Why? There’s an election coming in 2015, and the Harper government is betting that a balanced Federal budget will take the wind out of Justin Trudeau’s sails at the polls.

A balanced budget is good, but modern military procurement doesn’t spread program risk between the players — contractors have spent money, lots of it, to bring projects like the close combat vehicles this far and they’ll be well paid to close out those contracts.

The F-35 is a different matter. Lockheed Martin has pull in Washington and the program is dogged by cost overruns. That’s not unusual in military aircraft development, but in cash-strapped economies like ours, it translates into fewer planes bought, which increases the cost-per-plane dramatically.

All three US armed services want the F-35, but the number they’ll ultimately buy will depend heavily on that unit cost. The answer is foreign sales, and I’m betting that there’s lots of behind-the-scenes lobbying on Parliament Hill from Washington (and the Pentagon) to get Canada on board to keep the plane affordable.

South Korea looked at their options and chose Boeing’s excellent F-15 Silent Eagle, and then mysteriously reversed that decision in favour of the F-35. South Korea is one of the few nations that have a dangerous, unpredictable threat on their doorstep. Their president sleeps every night within range of North Korean artillery in the hundreds and is openly threatened with attack regularly. Defence is serious in Korea and they chose a cheaper option… and then at the last minute declared a sudden need for advanced stealth.

Politics? It’s hard to think otherwise and you can bet that the pressure from Washington and the threat of losing offset contracts with Canadian suppliers will decide the issue for the Harper government as well. In the end, I believe they’ll buy the F-35. The South Koreans are tough and they succumbed to the pressure… don’t expect anything more from Ottawa.

The metalworking sector is going to have to be tougher. It’s up to us in the industry to help defray the cost to the taxpayer by winning as much as we can of the subcontract work and keeping it in Canada.

Let’s watch the subcontracting process like hawks and make sure we’re competing fairly on price, delivery and quality. We could build our own aircraft, but we won’t. If we won’t build our own, then let’s build as much of it as we can.