Report suggests arms could boost economy
The Harper governmentis examining ways to turn Canada into a major arms producer in a bid to leverage hundreds of billions of dollars in planned defence spending into Canadian jobs and prosperity.
On Tuesday, an experts’ panel appointed by the government last year recommended focusing on six specific industries in which Canada can become a world leader as part of a revamp of the military procurement strategy.
It said the first priority is to equip the Canadian Forces, but that the government can and should help strengthen the country’s defence and security sector so it can expand its reach into the rest of the world.
Public Works Minister Rona Ambrose said the government will review the panel’s recommendations closely.
However, she also indicated the government is determined to use the planned military spending to help both the military and average Canadians.
“The opportunity here is a great one, not just for the Canadian Forces, but also for the Canadian economy,” she told defence industry representatives in Ottawa. “The opportunity for the Forces and the opportunity for the economy goes hand in hand.”
The panel, headed by Canadian businessman Tom Jenkins, advised the government to nurture six specific industries: Arctic and maritime security; protective equipment for soldiers; command and support capabilities; cybersecurity; training systems; and maintenance and support.
It also said government should establish a balance between developing original defence equipment domestically and being involved in international partnerships, as well as purchasing outright or adapting existing equipment to Canada’s needs.
This would enable not only the equipping of the Canadian military, but also position the country to develop and market weapons, vehicles and other military equipment to the rest of the world.
Competition is expected to be stiff; not only are other countries such as the United States, France, Germany and even Russia already ahead in the game, but many potential customers are implementing deep defence spending cuts.
Still, Jenkins’s panel noted that planned military spending has the potential to have more impact on the Canadian economy than the oilsands, which are estimated to generate $364 billion over 25 years.
Jenkins told reporters it is “a unique time” for the federal government and Canada’s defence industry given that the air force, army and navy are all looking at an influx of new equipment to replace older vehicles and weapons.
For that reason, he said, it is a time when the government and Canada “can think about this strategically” — using those investments for the country’s economic growth and prosperity.
But any effort to modify military spending for economic benefit will be extremely complex as the federal government will be forced to balance not only the needs of the Canadian Forces, but also contend with a powerful and influential defence industry.
The controversy surrounding the $45-billion F-35 stealth fighter program, and problems that have been bubbling around the government’s plan to spend $35 billion on new ships, are examples of the scale of the issues that can plague defence spending.
National Defence, like all federal departments, is also facing deep budget cuts, in the order of between $1.1 billion and $2.5 billion over the next three years.
Most importantly, however, is that the Harper government is reviewing its so-called Canada First Defence Strategy (CFDS), a plan announced in 2008 to invest $490 billion in the military over 20 years.
This is after Defence officials warned as far back as 2011 that the strategy was unaffordable.
Ambrose acknowledged questions around the planned defence spending, but she maintained the Harper government is not wavering in its commitment to investing hundreds of billions into rebuilding the Canadian Forces.
“That spend will continue to be large,” she said.
NDP military procurement critic Matthew Kellway said his party supports creating a strong defence industrial strategy if it creates Canadian jobs and economic prosperity, and he said Canadian industry can compete with other global players.
But he called the Jenkins’s reports release “a terrible irony” given that there are so many unanswered questions around the Canada First Defence Strategy.
“We had better be clear on what money gets spent on this equipment,” Kellway said.