Wednesday, November 05, 2008

The spectre haunting the defence budget

The new Conservative government:
Ottawa's tumbling fiscal fortunes and the possibility of budget cuts could not have happened at a worse time for the battle-worn Canadian military, which is still waiting on replacements for its tired and aged planes, ships and vehicles.

All across the federal government, preparations began in earnest this week for next year's budget and even some of the Conservative government's most ardent supporters in the defence community are gloomy.

The Conference of Defence Associations, an Ottawa-based military advocacy group, recently questioned the federal government's "ability and willingness" to live up to plans outlined in its defence strategy...

Douglas Bland, chair of defence management studies at Queen's University, said he expects the defence budget will be a tempting target because for bean counters its easy money.

"The defence budget provides - or is - the largest discretionary budget that the federal government has; in other words they're not obliged by agreements with the provinces or statutes to spend on defence," said Bland.

"Therefore it is often tempting for governments under financial stress to reach for the defence budget to make up for deficiencies and deficits."

The Conservatives have cast themselves as defenders of the military, embarked on an ambitious rearmament program and promised regular funding increases.

But behind the rhetoric, pragmatic political and fiscal considerations have tempered the enthusiasm.

A 2006 campaign promise to increase the size of the regular and reserve forces to 75,000 and 35,000 members respectively was quietly scaled back last year for want of funding [see "Overview of Human Resources" at end here].

Critics have pointed out the Tories' much-hyped defence budget increases - 1.5 per cent per year until 2011 and two per cent each year after - barely keep up with inflation and could, depending upon the economy, leave the military further strapped in the future.

When the Conservatives came to power, funding for most of their big-ticket purchases was backloaded to the budget years after 2009-10.

A number of capital projects on the books are stuck - or hopelessly sidetracked in the bureaucracy.

Bland said the economic downturn couldn't have come at a worse time in the rebuilding process.

"We're in a position where time is running out on these pieces of equipment and there might not be any money," he said...

A request to interview Defence Minister Peter MacKay, who was apparently to receive an update this week on the status of major projects, was turned down and his office issued only a terse one-line statement.

"The minister is not prepared to speculate on the budget process," spokesman Dan Dugas said in an email...

In August, the Conservatives quietly killed the $2.9-billion process to replace the navy's 1960s vintage supply ships because the bids were more than what Ottawa was prepared to spend.

Unofficially, National Defence has talked about relaunching the joint support ship program next year, but has been silent on plans to replace the country's aging command and control destroyers.

The Tories have awarded a $3-billion contract to Lockheed-Martin to modernize the country's 12 patrol frigates [Update: a post on the actual contract].

But defence sources said Tuesday that a long-term air force program to purchase high-endurance, unmanned surveillance aircraft for coastal surveillance - known as Project JUSTAS - was being bumped back two years, possibly to 2013-14 [emphasis added].

A proposal to buy 65 Joint Strike Fighters - a roughly $8-billion venture to replace nearly 30-year-old CF-18s fighter-bombers - must be considered by cabinet soon.

Another project that has been delayed because of money and contract delivery times includes the $3.4-billion purchase of 28 CH-148 Cyclone helicopters to replace air force Sea Kings [Update: more on Sea King problems] .

It's unclear what is happening with the $4.2-billion purchase of 16 CH-47F Chinook battlefield helicopters from Boeing [see end of this post]; the $1.2-billion acquisition of 2,300 new medium-sized logistics trucks; and the $1.3-billion plan to purchase 15 new fixed-wing search-and-rescue planes.

There are also projects that haven't even hit the drawing board, including the Tory promise to build six to eight light icebreakers to patrol the Arctic [they're to do much more than that and are not really "icebreakers"].
Aerospace and Defence
Potential Major Crown Projects
that will have IRB requirements


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