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June 11, 2018 | Local, Aerospace, Naval, Land, C4ISR

DND unable to spend billions in equipment funds, pushing projects beyond next election

Murray Brewster

National Defence fell $2.3 billion short in its plan to re-equip the military in the past year — a failing that one defence analyst says guarantees many important decisions on warplanes, ships and vehicles will be pushed beyond next year's election.

Defence Minister Harjit Sajjan revealed the figure Wednesday as he launched the department's long-anticipated investment plan at a major defence industry trade show in Ottawa.

The plan is the Liberal government's spending roadmap for its defence policy, released a year ago, which pledged $6.2 billion in new capital spending in the first year.

New figures show $3.9 billion was spent.

Later in the day, the chair of the Liberal government's council of economic advisers underscored the importance of investment in the defence sector and how it will drive innovation in other sectors.

"If we want to grow — and we can in Canada, and we want to grow more significantly — the defence sector is going to play an essential part in doing that," Dominic Barton said.

Leading-edge military technology and the possibilities for its commercialization can transform the broader economy, he added.

However, the investment plan presented by the Liberals on Wednesday leans heavily on refurbishing existing technology and equipment — mostly aircraft — in the coming decade.

The Defence Capabilities Blue Print will see the air force's CF-18 fighter jets, C-140 Aurora surveillance planes, C-144 Challenger executive jets, C-150 Polaris refuellers and transports, CT-114 Tutor trainers and demonstration jets, C-149 search and rescue helicopters and CH-146 Griffons all given life extensions and upgrades.

New aircraft, including drones, won't be introduced until the mid-2020s — or later.

A defence analyst said that's no surprise since many major decisions will be pushed past the 2019 election. That means it will be up to the next government to make the tough decisions on how much to buy and how much to spend.

"Unless we see an extremely busy June with a lot of announcements on milestone projects, a lot of the work is going to be left until later," said Dave Perry, an expert in procurement at the Canadian Global Affairs Institute.

"They're not moving ahead as quickly as they suggested in the defence policy."

The government could leave even more money on the table this year. Figures compiled by Perry, using the federal government's own budget documents and records, suggest as much as $3 billion could go unspent on military equipment in the current fiscal period.

The former Conservative government was repeatedly criticized for promising the military big things in terms of equipment, but rarely delivering and allowing allocated funds to lapse.

That cash was eventually kicked back to the federal treasury and used for deficit reduction.

DND gets to keep money, spend it later

Sajjan said defence spending is now guaranteed in the fiscal framework, the government's long-term financial plan.

That means National Defence gets to keep the money and spend it later.

"We always know we might not need the extra funds, but they have to be there just in case," Sajjan said. "Rest assured, the unspent $2.3 billion dollars is protected. Those funds remain available when we need them."

He defended the spending "delta," saying that 30 per cent of it comes because projects came in under budget. Another 42 per cent was because of delays by defence contractors.

Approximately one-third, though, relates to the department's inability to make a decision — or develop specifications on time.

Sajjan took a shot at the government of former prime minister Stephen Harper, which used to regularly publish its defence spending plans, but never had specific funding attached to individual projects.

Conservative defence critic James Bezan said there is a disconnect between the government's defence policy and its spending plans as outlined in federal budget documents.

"Nothing seems to match," said Bezan, who treats the federal budget as the last word in spending.

There was no mention of National Defence in Finance Minister Bill Morneau's latest fiscal, presented in February. Defence officials insist that is because the department's spending is already accounted for in the fiscal framework.

The federal Treasury Board, however, must approve funding on a project-by-project basis — and Bezan said that hasn't been done.

"There's no money to do the things Sajjan is out there talking about," he said. "We are still dealing with the problems of getting procurement done in a timely manner and getting it done on budget."

The head of a defence industry group — Sajjan's audience as he made the announcement — said the government does deserve credit for consulting more about projects ahead of time, but there are obvious shortcomings.

"Any time funding moves to the right, it is a predictability problem for us. We want as as predictable and as stable funding as we can get," said Christyn Cianfarani, the president and CEO of the Canadian Association of Defence and Security Industries.

"I still think, systemically, there is a problem and if we don't turn it upside down and shake it — the whole procurement system — and do things differently ... many, many things differently, we'll still see sluggishness in the procurement system."

He said the Liberal investment plan is not "aspirational" and states clearly where the cash is coming from.

The Conservative guidebook in the end "did not deliver for the men and women in uniform," Sajjan told the audience of defence contractors.

http://www.cbc.ca/news/politics/sajjan-dnd-equipment-funds-1.4683606

On the same subject

  • Feds to move military aircraft testing from Alberta to Ottawa, but Cold Lake politicians say they're in the dark

    December 7, 2018 | Local, Aerospace

    Feds to move military aircraft testing from Alberta to Ottawa, but Cold Lake politicians say they're in the dark

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  • National Defence to roll out spending cuts over next three years - officials say extent of impact 'yet to be confirmed'

    September 10, 2023 | Local, Land, Security

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    June 19, 2018 | Local, Aerospace, Naval, Land, C4ISR, Security

    CANADA TO ACQUIRE THALES ADVANCED GROUND SEGMENT TECHNOLOGY TO RESPOND TO DISTRESS SIGNALS

    • Canada has awarded Thales Canada Phase II of the MEOSAR (Medium Earth Orbit Search and Rescue) Ground Segment contract. • The contract includes the procurement of two MEOLUTs and maintenance services for five years with options for an additional five years. • Using Thales Alenia Space's powerful and compact MEOLUT Next phased array solution, Canada will benefit from the world's first space borne search and rescue system of this type. Canada has awarded Thales Canada Phase II of the MEOSAR (Medium Earth Orbit Search and Rescue) Ground Segment contract. It will support Canada's ability to respond quickly and effectively to distress signals from land, air and sea from coast-to-coast-to-coast; enabling Canada to meet its obligations under the International COSPAS-SARSAT Programme Agreement. The contract includes the procurement of two MEOLUTs and maintenance services for five years with options for an additional five years. Using Thales Alenia Space's powerful and compact MEOLUT Next phased array solution, Canada will benefit from the world's first space borne search and rescue system of this type. Thales Alenia Space designs, operates and delivers satellite-based systems for governments and institutions, helping them position and connect anyone or anything, everywhere. Since its commissioning in 2016, MEOLUT Next has delivered unrivalled performance, detecting distress signals more than 5,000km away. This new capability saves lives. On July 2, 2017 at 6:30 a.m., 70 kilometres off the coast of Sardinia, a 12-meter sailboat with three people aboard triggered its COSPAS/SARSAT beacon when its rudder broke and its engine failed. Its VHF radio out of range, the sailors quickly realized they were in a critical situation with waves over four meters high and the wind blowing at 40 knots. MEOLUT Next was able to receive and process their distress signals in less than five minutes, providing accurate positioning to authorities. An airplane identified the boat less than two hours after the beacon was triggered and a helicopter airlifted the crew to safety, saving all three lives. “Thales Canada is proud to deliver world class solutions that will make life better and keep us safer,” said Jerry McLean, Managing Director and Vice President, Thales Canada. “From complex C4ISR systems to integrated maritime C3 and diverse aerospace solutions, this contract further reflects Thales' continued commitment to Canadian innovation.” “We are confident that our solution will meet and exceed Canada's MEOSAR expectations, offering Canada a decisive technology for its decisive moments,” said Philippe Blatt, VP Navigation France at Thales Alenia Space. “Today, MEOLUT Next is the only solution in the world capable of processing second-generation beacons in real time. Its operational efficiency was recently recognized by Space & Satellite Professionals International (SSPI) for its humanitarian contributions”. Notes to Editor COSPAS/SARSAT COSPAS/SARSAT is an intergovernmental organization founded by Canada, the United States, Russia and France. In operation in 43 countries around the world, this satellite-based search and rescue distress alert detection and information distribution system is best known for detecting and locating emergency beacons activated by aircraft, ships and backcountry hikers in distress. Today, some 500,000 ships and 150,000 aircraft are equipped with COSPAS/SARSAT distress beacons. To date, the COSPAS-SARSAT service has saved more than 37,000 lives. MEOLUT Next Conventional MEOLUT (Medium Earth Orbit Local User Terminal) systems use large parabolic antennas and are limited by how many satellite signals they can receive. Thales Alenia Space's MEOLUT Next solution is compact, measuring less than six square meters, with the ability to track up to 30 satellites, significantly enhancing the distress beacon detection rate while expanding the coverage zone. Since there are no mechanical components, hardware maintenance costs are the lowest on the market. About Thales The people we all rely on to make the world go round – they rely on Thales. Our customers come to us with big ambitions: to make life better, to keep us safer. Combining a unique diversity of expertise, talents and cultures, our architects design and deliver extraordinary high technology solutions. Solutions that make tomorrow possible, today. From the bottom of the oceans to the depth of space and cyberspace, we help our customers think smarter and act faster - mastering ever greater complexity and every decisive moment along the way. With 65,000 employees in 56 countries, Thales reported sales of €15.8 billion in 2017. About Thales Canada A national leader in research and technology, Thales Canada combines its more than 50 years of experience with the talent of 1,800 skilled people located coast-to-coast. With revenues of $500 million, Thales Canada offers leading capabilities in the urban rail, civil aviation and defence and security sectors that meet the needs of customers' most complex requirements across every operating environment. About Thales Alenia Space Combining 40 years of experience and a unique diversity of expertise, talents and cultures, Thales Alenia Space engineers design and deliver high technology solutions for telecommunications, navigation, Earth observation, environmental management, exploration, science and orbital infrastructures. Governments, institutions and companies rely on Thales Alenia Space to design, operate and deliver satellite-based systems that help them position and connect anyone or anything, everywhere, help observe our planet, help optimize the use of our planet's – and our solar system's – resources. Thales Alenia Space believes in space as humankind's new horizon, which will enable to build a better, more sustainable life on Earth. A joint venture between Thales (67%) and Leonardo (33%), Thales Alenia Space also teams up with Telespazio to form the parent companies' Space Alliance, which offers a complete range of services and solutions. Thales Alenia Space posted consolidated revenues of about 2.4 billion euros in 2016 and has 7,980 employees in nine countries. www.thalesaleniaspace.com PRESS CONTACTS Cara Salci National Director, Public Affairs & Communications Thales Canada Tel.: 613-404-9413 cara.salci@ca.thalesgroup.com THALES ALENIA SPACE Sandrine Bielecki Tel: +33 (0)4 92 92 70 94 sandrine.bielecki@thalesaleniaspace.com Chrystelle Dugimont Tel: +33 (0)4 92 92 74 06 chrystelle.dugimont@thalesaleniaspace.com Cinzia Marcanio Tel: +39 06 41512685 cinzia.marcanio@thalesaleniaspace.com https://www.thalesgroup.com/en/worldwide/space/press-release/canada-acquire-thales-advanced-ground-segment-technology-respond

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