How the Lib­er­als are mess­ing up de­fence spend­ing

Cost, le­gal­ity and timetable are big is­sues writes

Ottawa Citizen - - OPINION - Alan Wil­liams.

The gov­ern­ment’s strat­egy to re­place Canada’s CF-18s is re­flec­tive of a gov­ern­ment that ei­ther has no com­pre­hen­sion of how to con­duct the busi­ness of de­fence pro­cure­ment, or un­der­stands the busi­ness all too well but has put po­lit­i­cal ex­pe­di­ency ahead of the best in­ter­ests of the mil­i­tary.

There are three fun­da­men­tal prob­lems with the de­ci­sion to sole-source for 18 “in­terim” Su­per Hor­nets:

First, whether or not you be­lieve there is a “ca­pa­bil­ity gap,” the fact is that an open, fair and trans­par­ent com­pe­ti­tion can be con­cluded within one year. Nor­mally, a com­pe­ti­tion could take up to four years: two years for the mil­i­tary to pre­pare its state­ment of re­quire­ments (SOR) and two years for the civil­ian au­thor­i­ties to con­duct the com­pe­ti­tion.

In this in­stance, a short­ened time pe­riod is fea­si­ble. The mil­i­tary’s SOR has al­ready been pre­pared. In its cur­rent form, it is wired or fixed so that only the F-35 could bid suc­cess­fully to re­place our cur­rent jets. How­ever, these bi­ased cri­te­ria are few in num­ber and eas­ily mod­i­fi­able to en­sure fair­ness to all sup­pli­ers. As such, it would take no more than a few weeks to re­draft the SOR. In ad­di­tion, over the past six years, the po­ten­tial sup­pli­ers have been vis­ited, have filled out ques­tion­naires and have been sub­ject to in­spec­tion ad nau­seam. This con­sul­ta­tive time need not be re­peated. The process can eas­ily be con­cluded within 12 months.

Se­cond, the “in­terim” so­lu­tion is il­le­gal. The gov­ern­ment is wrong when it claims that an “ur­gent” need al­lows it to by­pass com­pe­ti­tion. The spe­cific word­ing in article 506.11(a) in the Agree­ment on In­ter­nal Trade reads in part: “Where an un­fore­see­able sense of ur­gency ex­ists ...” Note the word “un­fore­see­able.”

Bad plan­ning is not an ex­cuse for sole-sourc­ing. A “ca­pa­bil­ity gap” that was al­lowed to grow over many years is hardly “un­fore­see­able.” The article was de­signed to al­low for sole-sourc­ing in the event, for ex­am­ple, that the gov­ern­ment

Boe­ing and its share­hold­ers (have) been given a multi­bil­lion-dol­lar gift.

an­nounced it was send­ing our troops into a theatre of op­er­a­tion and there would be in­suf­fi­cient time to con­duct com­pe­ti­tions. Surely, it is not un­rea­son­able for us to hold our gov­ern­ment lead­ers ac­count­able for obey­ing the law.

Fi­nally, a prob­lem with ac­quir­ing the Su­per Hor­nets is the in­cre­men­tal cost of such an op­tion. The cap­i­tal bud­get of the De­part­ment of Na­tional De­fence is al­ready stretched to its limit. To im­pose upon it an ex­tra bur­den of bil­lions of dol­lars is un­con­scionable and un­nec­es­sary.

It’s very easy to iden­tify the losers in this flawed strat­egy. The gov­ern­ment, for its galling hypocrisy; the mil­i­tary, as its cap­i­tal bud­get is pres­sured and it is forced to en­dure an­other decade with­out a long-term re­place­ment of its jets; us tax­pay­ers, as it is our bil­lions of dol­lars be­ing squan­dered; and Cana­dian in­dus­try now de­prived of high-qual­ity jobs that would have been guar­an­teed un­der a com­pe­ti­tion.

How­ever, this de­lay­ing tac­tic does pro­duce two win­ners. First, Boe­ing and its share­hold­ers for hav­ing been given a multi­bil­lion-dol­lar gift. Se­cond, iron­i­cally and un­doubt­edly much to the cha­grin of the prime min­is­ter, Lock­heed Martin. The F-35 would have a much harder time win­ning a com­pe­ti­tion now than it will in five years. While it has been de­clared op­er­a­tional by the U.S. Marines and Air Force, the fact is that not all soft­ware has been in­stalled. Five years from now, I have lit­tle doubt, all the soft­ware will have been im­ple­mented with the bugs worked out.

Fur­ther­more, in five years the unit price for the jet will have con­tin­ued to de­cline.

To bor­row from Shake­speare, the Lib­eral party may find it­self “hoist with (its) own petard.” Alan Wil­liams is a for­mer as­sis­tant deputy min­is­ter of matériel at the De­part­ment of Na­tional De­fence. He is now pres­i­dent of The Wil­liams Group pro­vid­ing ex­per­tise in the ar­eas of pol­icy, pro­grams and pro­cure­ment. He has au­thored two books, Rein­vent­ing Cana­dian De­fence Pro­cure­ment: A View From the In­side; and Canada, Democ­racy and the F-35.

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