Purchasing Controversy
© 2006 FrontLine Defence (Vol 3, No 4)

Last month, amidst great ceremony, the Conservative government announced more than $17 billion in new military equipment procurement.

While many of these are necessary for the Canadian Forces, they are now riddled in controversy due to contracting procedures. With this much spending on the line, we must ask ourselves whose interests are really being served.

Canadians have yet to learn why the Conservative government has announced it will effectively sole-source the purchase of military transport equipment from two multinational corporations in the United States: Boeing and Lockheed Martin. On top of this, Boeing is also expected to be handed the $1.6 billion maintenance contract for the unnecessary and costly C-17 purchase without any competition. Further, for the first time in our history, the remaining 20-year maintenance contracts are also expected to be awarded by American firms instead of the Government of Canada.

Canada’s aerospace industry, which is traditionally engaged in the maintenance of military aircraft, stands to see little benefit.

It appears that the acquisition of military equipment is being done as quickly as possible to give the impression that Ottawa is taking action as opposed to meeting the needs of our military. But by acting in this manner, the Conservatives are acquiring military airlift capacity that, as in the purchase of strategic airlift, does not respond to the current needs of the Canadian Forces. And this purchase is planned to proceed without a call for tenders.

It is unclear why the government seems willing to cede the public tendering process for maintenance contracts to American companies without protecting the interests of the Canadian aerospace industry. If Mr. Harper wants to demonstrate a commitment to defending industry here at home, he should guarantee Canadian companies access to a competitive tendering process for these contracts.

Not only will these maintenance contracts be lost south of the border, but the flow-through benefits to research and development will fail to reach Canadian enterprises. And all because no minister in this Conservative government has the courage to stand up for the interests of our own industry.

We must then ask ourselves whose interests the Conservatives are really serving. If it is evident that this procurement will be of great benefit to Canadians, why do Mr. Harper and his colleagues remain silent in these questions? And why are they initiating the purchase of strategic airlift capacity when Chief of Defence Staff Rick Hillier himself has said that this is not a priority for the Forces and that he would prefer to lease these aircraft and spend these procurement dollars on higher priority needs?

If it is certain this is the way to proceed, the Government of Canada should have defended its position more forcefully, rather than leaving so many questions unanswered. Canadians know sole-source contracts do not serve the best interests of tax-payers, since, without a competitive tendering process, they result in unnecessarily high project costs. Canadians have the right to know how such high-profile and expensive projects are managed.

This is not a question of opposing the purchase of military equipment based on partisanship. As those who have followed these files will know, many of the purchases were already in the works under the previous administration. The problem arises from the fact that the tendering process has been rushed, altered, and in some cases, circumvented altogether.

Before this government goes any ­further, Minister O’Connor should immediately take steps to make the purchasing process fair to Canadian industry.
In this way, the process will be more transparent, the Canadian Forces will be better served, and the interests of all Canadians will be protected.

Denis Coderre is a the Liberal critic for Labour and for the Economic Development Agency of Canada for the Regions of Quebec.
© FrontLine Defence 2006