Mark Collins – Canadian Defence Procurement: Not Buying, Why Book the Bucks?

Actually seems rather sensible in the actually existing circumstances:

1)Armed Forces hardware budget sees funds punted to the future

The Conservative government is making so little headway in six-year-old plans to re-equip the Canadian Armed Forces that it’s again shifting billions of dollars of unspent military-hardware funding to budgets at least half a decade in the future.

The 2014 budget unveiled by Finance Minister Jim Flaherty Tuesday would transfer more than $3-billion of military-equipment spending to fiscal years beyond 2018-19…

These repeated transfers of Department of National Defence capital funding reflects just how badly the Canadian government [and the Canadian Forces] has fumbled the ball on military purchasing [no kidding!], defence insiders say…

The list of postponed military acquisitions has been growing steadily – including search-and-rescue aircraft, next-generation fighter jets, Arctic patrol ships, a major icebreaker, naval resupply ships and maritime helicopters…

David Perry, a senior defence analyst with the Conference of Defence Associations Institute, said he was surprised to learn how much earmarked cash is once again being shifted to future budgets but added that he has tracked a “persistent underspending” of military procurement money in recent years.

Mr. Perry said one problem is the federal government tried to buy so much at once after a relatively long pause in purchasing big-ticket military items that saw Ottawa’s required expertise and capacity wither away…

2) DND Budget Cuts Delay Purchase Of New Equipment To ‘Future Years[note cuts to CF-18 operations at end]


Defence sets aside a certain amount each year to buy new gear, but the new budget kicks that planned spending — originally scheduled to take place between 2014 and 2017 — to “future years,” putting many programs in doubt.

Flaherty defended the decision, saying it wasn’t a cut and the money is being socked away until the military can use it.

“There’s no point in having money sitting there when they can’t spend it this year, which they can’t,” he said prior to the budget’s public release. “So, we’re pushing it forward, not taking it back.”..

The stowing of equipment funds adds to previous Conservative austerity measures, which have already carved as much as $2.1 billion out of defence.

As the biggest discretionary pot of federal money, the military is accustomed to having a target on its back. But the pain won’t end once the government delivers a $6.3-billion surplus at the end of the 2015-2016 budget year, one defence analyst says.

National Defence will continue to feel the squeeze as the Conservatives strive to keep the books balanced — without generating new revenues — in order to finance long-promised goodies such as income splitting, said Dave Perry…

“If you are making all of these moves to restrain federal spending writ large, cut taxes and spend money on other programs, I don’t see a big windfall coming for the military post-2015,” Perry said.
“I just don’t see how it can work given the political parameters they’ve outlined.”

Deferring capital spending will erode the buying power of projects that have already been announced, forcing the military to either make do with fewer ships, planes and vehicles, or settle for less sophisticated gear [emphasis added], he added…

In the meantime, though, Perry said the renewed departmental spending freeze — coupled with other restraint measures — will have a significant impact on defence, forcing it to internally reallocate as much $591 million by 2015.

That will mean less cash for operations, maintenance and training — and the numbers are stark.

In the 2009-10 budget year, the last before the axe began to fall on spending, National Defence was given $7.6 billion to spend on upkeep, fuel, patrols and exercises. According to Perry’s research, that number has fallen by 18 per cent.

The effects are already apparent. On Monday, the Snowbirds flying team announced it was cancelling performances in the U.S. due to budget cuts. A number of the army’s logistics trucks, known as the B-Fleet, have also been mothballed.

And defence sources say funding for CF-18 operations and maintenance, the air force’s premier weapons system, has already been curtailed by as much 25 per cent [emphasis added]…

And here’s another aspect of the budget at MILNEWS.ca:

Budget 2014 (1)  What the document says (page 133)  “…. The Government is implementing the Defence Procurement Strategy to ensure defence procurement generates economic benefits and jobs for Canadians …. The Government’s new approach to defence procurement will help create jobs, build industrial capacity, encourage innovation, promote export opportunities and drive economic growth in Canada ….”  Note how much space is spent on how industry benefits compared to getting the right stuff to the pointy end of the spear…

In which context have a look at these earlier posts:

Reforming Canadian Defence Procurement: Well, it Can’t Get Any Worse…

Reforming Canadian Defence Procurement: Well, it Can’t Get Any Worse…Part 2

J.L. Granatstein – Defence-Procurement plan creates new mess
[the Ross Rifle gets a mention!]

Sigh.

Mark Collins, a prolific Ottawa blogger, is a Fellow at the Canadian Defence & Foreign Affairs Institute; he tweets @Mark3Ds

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5 Comments

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5 responses to “Mark Collins – Canadian Defence Procurement: Not Buying, Why Book the Bucks?

  1. And it does look as if the RCAF will soon have WingCos instead of Lt.Cols–though what this announcement is doing in a budget speech beats the hell out of me (via MILNEWS.ca):

    ‘…
    Budget 2014 (2a) Some highlights from the document itself (this one on page 232) “…. Economic Action Plan 2014 proposes to recognize the historic titles and rank designations of the Canadian Armed Forces in the National Defence Act – The Government of Canada has honoured the proud history of the Canadian Armed Forces by restoring the titles of the Royal Canadian Navy, Canadian Army and the Royal Canadian Air Force, as well as traditional rank designations for our men and women in uniform. In recognition of Canada’s military traditions and heritage, the Government proposes to amend the National Defence Act to enshrine these titles and designations in law ….”’
    http://milnewsca.wordpress.com/2014/02/11/news-112115est-feb-14/

    Budget here:
    http://www.actionplan.gc.ca/sites/default/files/pdfs/budget2014-eng.pdf

    Earlier:

    “Just Wondering: If/When the RCAF Reverts to Old RAF-Style Ranks…”
    http://cdfai3ds.wordpress.com/2014/01/08/mark-collins-just-wondering-ifwhen-the-rcaf-reverts-to-old-raf-style-ranks/

    Mark Collins

  2. And note what the gov’t shows no indication of doing:

    Mark Collins

  3. See my making similar points about review:

    Mark Collins

  4. IMHO the F-35 decision has been punted until after the next federal election.

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