Thursday, October 10, 2013

How screwed up is Canada's military procurement process?

Canada's military procurement.  A few hits, but mostly misses.  


Canada's military procurement strategy lately seems to beg the question:  "Does Canada have a military procurement strategy?"

Big ticket items, like fighter jets, helicopters, and even a new headquarters seem almost unobtainable thanks to controversy, cost overruns and delays.  In the meantime, the Canadian Armed Forces are left wondering when the new equipment will arrive, if ever.

How bad is it?  Some have compared it to a Monty Python movie.

The Sea King replacement:  Going on 30 years of searching...

The most notorious example, the Sea King replacement, has now been in the works since 1983.  It's one time designated replacement, the EH101, was canned by the Chretien government back in 1993, and the program was put on the back burner until the mid-1990s.  Finally, in 2004, a militarized version of the Sikorsky S-92 Cougar, dubbed the CH-148 Cyclone, was selected.  Now, almost 10 years later, we are still waiting for delivery.  Sikorsky almost seems uninterested in finishing the aircraft's development, and the Canadian Government is now examining other options.


Now you see it...  Soon you won't?
Then there is the well known CF-18 replacement.  In 2010, the federal government, without competition, selected the Lockheed Martin F-35 Lightning II.  This, despite concerns over the F-35's performance, price, availability date, and whether it was even suited for Canada's military.  After a much publicized audit pegged total costs for a F-35 at $46 billion, Ottawa pushed the "reset" button...  Meaning what, we still don't know, but other options are said to be under consideration.

Not enough?

Rendering of the "new and improved" Halifax shipyards.
How about Canada's National Shipbuilding Procurement Strategy (NSPS)?  NSPS aims for strictly Canadian design and construction of all Canadian naval vessels for the foreseeable future.  This, despite the fact that Canada has not built such a craft in almost 20 years and other suitable ships are available.  While the commitment to boost Canada's shipbuilding industry is commendable, it will still be a few years before improvements are completed to the Irving owned Halifax shipyards.  It will also take some time for Canadian firms need time and money to develop the skill sets needed to develop and produce cutting edge naval vessels.  In the meantime, Canada needs new icebreakers and support ships NOW.

A leased CH-178...  Also known as the Russian Mil Mi-17 "Hip".
There is of course, the odd tale of Canada's CH-47 Chinook helicopters.  In 1974, Canada took delivery of 8 CH-47 Chinook heavy-lift helicopters.  In 1991, these were sold to The Netherlands, as it was decided that they were too expensive to operate, and that Canada "didn't really need them anyway".  That was before Afghanistan, however.

Operations in Afghanistan soon revealed a desperate need for a medium/heavy-lift helicopter.  But Canada didn't have any!  New CH-47Fs were ordered, but the earliest they would be delivered was 2012, a full year after the scheduled pull out.  One of the few options available was to lease Russian Mil Mi-17 "Hip" medium-lift helicopters.  While these were not a fully equivalent to the Chinooks, they were available and cheap.  The Canadian government has been rather tight-lipped on this whole predicament.

Canada did eventually end up buying several used CH-47Ds directly from the U.S. Army in 2008.  These choppers were already serving in Afghanistan, conveniently enough.  Of course, just to show how history has a tendency of repeating itself, these CH-47Ds are now being sold.

Finally, this past summer, Canada started taking delivery of its first shiny new CH-47F helicopter.  While it has been presented with great fanfare as an example of how smooth the Canadian military procurement process can be, when looked at as a whole the saga of the Canadian Chinook seems more like a comedy of errors.  We had some, then sold them. We then needed them, so we ordered some more, but we couldn't get them in time, so we leased a few Russian models and bought a few used from the U.S. Army...  Which we are now selling to make room the new ones that are finally arriving now that there is no longer a pressing need.


Proof that Canadian military procurement sometimes goes right.  The C-117.

There have been a few glimmers of hope amongst Canada's dismal procurement record lately however. The C-17 purchase comes to mind, but that was more by accident than design.  Despite cries from the USAF that it had more than enough, the U.S. Congress demanded more C-17s be made in order to keep the factory open.  Canada was lucky enough to simply pick up a few C-17s that weren't really needed by the USAF at the time.  C-17 production is now slated to end in 2015, but there are still calls to keep the line open.

Canada's new Minister of Defense, Rob Nicholson.

With the House of Commons (finally!) getting back together next week, many eyes will be on new Defense Minister Rob Nicholson.  Two things are expected:  Budget cuts and a revamp to procurement.  It won't be an easy job to balance the two, that's for sure.  Many will offer advice, that is to be sure.  The evidence is clear however, that Canada needs a new (has there even been one?) model for defense purchases.  One that is streamlined.  One that can balance the often conflicting demands from Canada's military, its industry, and its taxpayers.

Why is this so hard?  Because military personnel will request (and deserve) the latest, greatest equipment to help them complete their missions and bring them home safely.  But Canada can't simply shovel money at foreign military contractors.  We need to ensure that some of that money goes toward Canada's economy and helps employ Canadian workers.  Lastly, we need to make sure that the Canadian taxpayer sees value for his or her money.  It's simply not possible to hand over a "blank cheque" hoping it results in the best hardware and the best jobs.

There is a recent focus on making sure that Canadian defense dollars go toward more "built in Canada" products.  Does this make sense if there are proven "off-the-shelf" options available?

Does the current bloated bureaucracy slow things down too much?  Would a more streamlined "secretariat" serve us better, or would it lead to cost overruns and corruption?

A new defense minister would suggest that the Conservative government has something up its sleeve, as there will be some pressure to come up with a strategy before the next federal election, likely due to be called in 2015.  There are already talks about restructuring the upper echelons to save money. With all the other scandals hanging over its head, the governing Tories can't afford to give up their traditional bragging rights of being strong supporters of Canada's military.

What changes are in store?  Will they be enough?

6 comments:

  1. Doug,This in my opinion is your best blog, the one I enjoy the most. What I find most frustrating about our procurement process is the lack of philosophy behind most purchases. Its easy for the US, or the UK, or even Sweden to purchase equipment, they have a philosophy behind them. Are Peacemakers or Peace Keeper? Both? The Cyclone purchase is interesting; By the time we build are new surface combatants will they even need helicopters? Will drone take there place. If war over seas does break out, will ASW ever be important, or will there be a "convoy" of Boeings and Airbuses supplying Europe? Would a few Helicopters for supply, SAR, and piracy suffice. I would argue that 4 large surface combatants (destroyers) would suffice for foreign deployments, backed by a robust Coast Guard Cutter that could be converted to ASW in the time of war. It would be great as a country if we had a philosophy and stuck to it and purchased around it. I think Canadian jobs should be important in this process; we may pay more as tax payers, however the government surely has calculated how much of that money is "recovered" by the government. However I thinks it prudent that we pick our spots. For instance if Canada picked that pretty little Swedish plane (Gipen!) not only should we play a part in manufacturing the craft, but in development and marketing with SAAB to increase economies of scale and our own industries. We either do tanks or we don't, and judging by our ability to ship them, I would say no.
    However terror is the new war, and we have always done peacekeeping so purchase or develop a great armoured vehicle that will withstand IEDs. If we purchase F-35s (because of politics) purchase the C variant. Really, these planes are about networks, sensors, and stealth. They are not really great dog fighters. So really whats the difference if the C models slower or less maneuverable. Its made, not to be detected and fire missiles, thats it. At least the C may be more robust and at least we could refuel it mid air. Im not sure of the Arctic Patrol ships. Critics say they are "slush" breakers, but by the time they enter service, global warming may have done its thing, and it may all it needs to do. They say its to slow, but I suspect it helicopter may do a lot of the work.

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  2. First of all... Thanks very much for your interest and comments! They are appreciated!

    I think you hit on some very important points. including the future importance of UAV's, flexible platforms, and the like.

    The real meat of the issue is that there is no real "vision" of what Canada's military should be, now or in the foreseeable future. There is the "Canada First" defense strategy, but it's pretty darn vague. Sure, it states that the number one job of Canada's military is to protect Canada's sovereignty, but isn't that EVERY military force's #1 priority?

    Canada needs a proper "White Paper" documenting its military priorities and what Canada's military needs to be not only to us, but the world.

    Do we focus on merely protecting ourselves, and avoid U.S. style world policing, or do we follow their lead? Do we take a more active role in peacekeeping duties or focus more on humanitarian efforts? How badly do we want to maintain our Arctic sovereignty? Do we want to take part in the "Asian Pivot"?

    These are the questions that need to be addressed, once that happens, then we can properly focus on procuring the resources needed to do the job.

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  3. I chuckle, CBC just ran a story that says the government is questioning the future role of the maritime helicopter, and may be looking at smaller cheaper helicopters.....lol

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  4. Hi!

    That's a very interesting post. There is no perfect military procurement strategy, especially because of the (apparent) lack of global defense strategy in many countries. In addition, there isn't a strong interest for military matter in western countries, so politicians have few incentive to develop a true strategic vision.

    Even when the process works smoothly, the strategy behind the procurement remains questionable : C-117 is a great transport aircraft but was designed for the BIG U.S needs. I don't know canadian strategic transport needs, but is that not a bit *oversized*?

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  5. From my understanding part of the C-117 purchase was to deploy a rapid emergency team around Canada for disaster relief. The Swedes seem to able to define there defence strategy a purchase around it.....

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  6. ok, thanks for the details.

    Yeah, I think Sweden is one of the example of rational defense strategy. I don't know precisely Swedes defense doctrine, but that's the impression from a foreign point of view. The industrial arm is one side of the defense strategy, and Sweden seems pretty good at it, and moreover demonstrates a true approach of the question "What do we need? What should our army be capable of?".
    There should be more French-Sweden cooperation (nEUROn fallout?), we have a lot to learn from each other.

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