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'Buy the Best, Kill the Rest'
Dianne DeMille — CASR Editor Federal Budget — February 2003 My strategy was simple: obtain an extra $1 billion per year — $800 million from the Government and $200 million from internally generated improvements in administrative efficiency and re-allocations. I believe that those who oppose my commitment to finding $200 million through re-allocation are wrong. Government has a responsibility to the taxpayer to deliver services at maximum efficiency and minimum cost. New corporate and university leaders, as well as new ministers, will always be told that the low-hanging fruit has been picked and there are no more cost savings to be had. I disagree. Anyone with a $13 billion budget who cannot find $200 million in savings — less than 2% of the budget — should be in another line of work. Other reasons for the $200 million in re-allocation are more pragmatic. Without it, as the Minister of Finance has confirmed, Defence would have fared much worse in the budget. To those who say that Defence did not get nearly enough in the budget, I would also disagree. Some had argued for an immediate increase of up to $4 billion in the base budget for defence. But the reality is that the Department would be challenged to spend billions of dollars in new funding productively, in a single fiscal year. As this audience can fully appreciate, new equipment purchases take careful planning and time. The total additional [federal] spending next year [will be] $4 billion. Defence will get $1 billion. Billions more for Defence next year would mean nothing or next to nothing for health care, social programs, and other priorities. This is not what Canadians want. It is not what the Government wants. And it is certainly not what this Minister of National Defence wants. Now I'd like to say a few words about the broader strategic environment. Strategic Environment Militaries around the world face a daunting double challenge: an altered security environment and rapidly changing technology. Not much more than a decade ago, the dominant threat to the West was the Soviet Union. Integral to Europe's defence were rows upon rows of tanks. What is Europe to do with all those tanks now that the Soviet threat is history? Canada too was configured for the Soviet threat, with a military presence in Europe, much of the navy directed to countering Soviet submarines, and an air force focused as well on the risk of Soviet attack. The Post-Soviet hopes for a peace dividend proved largely illusory, even before September 11, as deployments of the Canadian Forces since 1989 were triple what they had been in the 1980s. Since September 11, it has become clear to all that the world is as dangerous and risky as ever, but for reasons that are new. As if this changed environment were not challenge enough, militaries around the world are also faced with rapidly changing technology. Essentially, this revolution in military affairs [RMA] is the military counterpart of what civilians know as the 'Information Age' or the 'New Economy'. It is the application of computer power to radically increase both the precision of weaponry and the information available to commanders and their troops. A major challenge is to achieve rapid or even instant sharing of this infor- mation with all who need it, within a country's own military, and with allies. Militaries around the world have no choice but to transform themselves [...] For us, the only question is whether Canada will achieve this transformation as well as, or better than, other countries. The way ahead My plan is to operate on two parallel tracks. The first track involves sustainability and the process of transformation. The second track is the defence review. Let me say here what the defence review is not. It is not an excuse to delay decisions. The defence review may result in more money for the Canadian Forces. Or it may not. Today, however, my focus is on the first of these tracks. Part of the budget funding will be directed to medium-term sustainability. [We will:] • Continue our ongoing recruitment campaign • Address key shortfalls in operating budgets • Proceed with the acquisition/upgrading of essential equipment • Strengthen the capabilities of the Reserves • Provide funding for pressing infrastructure and environmental issues These funds will also be used to accelerate the process of transformation. In order to liberate additional funds for this purpose, I have asked the Department to examine existing procurement plans with a view to weeding out low priority projects. Domestically, there are core functions that the Canadian Forces must always carry out. The army must respond to domestic crises like the ice storm, and it must contribute to homeland defence. The navy must patrol our shorelines, and the air force must patrol our skies. Overseas, on the other hand, since Canada always operates as part of a coalition, we have greater freedom to build on our strengths, to specialize, and to choose among alternative capabilities. Since the budget is less than ten days old, it is too early to offer a blueprint for the transformation process. I can, however, do two things. First, I can say that we will have to make difficult choices, asymmetric, unequal choices. When one is embarking on the path of transformation, the worst policy in the world is to have across-the-board budget increases that are equal for all. Second, I can describe three procurement issues by way of examples. Three examples First, the Canadian Forces will not be unilaterally purchasing large transport [airlifter] planes, at a cost of some $3-5 billion. Only two of our eighteen NATO allies, the United States and the United Kingdom, have this capability and their militaries are far larger than ours will ever be. We will consider other, much more cost-effective options, such as a strategic lift capability shared with NATO allies, including the United States. Second, I am impressed by General Jeffrey's vision of the army of the future. Part of that future involves the ISTAR project, which is a good example of transformation and the technology-driven substitution of brain for brawn. ISTAR, which stands for Intelligence, Surveillance, Target Acquisition and Reconnaissance, is a high-tech system that will serve as the eyes and ears of our commanders. It is the sort of project that will help transform our military into a technologically smarter, more modern force. ISTAR is projected to cost $600-700 million over ten years. Let me turn, finally, to the subject of tanks. Here we have to ask two questions. Do we need tanks? Many, including some in uniform, have their doubts. I share these. Does the army need some form of direct-fire support? That is certainly a priority. Moreover, there exists a made-in-Canada direct fire capability that the US military is in the process of acquiring in large numbers. This is an option that we will explore. As Mr. McCallum stated, the only big ticket item to be funded in the upcoming fiscal year will be the ISTAR project. It is a collection of high-tech equipment — sensors, processors, computers, etc. — designed to detect the presence of hostile troops, vehicles, and installations on the battlefield. The data gathered by sensors is fed back to a command centre where the information is processed, enhanced, and integrated into a coherent picture of the battlefield that can be updated constantly in 'real time'. Another modern weapon system hinted at in Mr. McCallum's speech was the 
'Mobile Gun System', the US Stryker M1028, a wheeled armoured vehicle mounting a 105 mm tank gun on a
modified LAV III chassis. The major advantage of this wheeled vehicle was that, unlike Canada's Leopard
tank, MGS can fit inside the CF CC-130 Hercules, crucial for rapid deployment onto any battlefield.
The first 400 Strykers, infantry carriers already delivered to the US Army, were built by General Motors Defense in London, Ontario. This plant was recently purchased by the large US corporation, General Dynamics Land Systems. [Update: DND ordered the MGS (as a 'rider' on the US Army M1028 order) in October 2003. However, the makers have had difficulty producing a combat- ready vehicle light enough to be transported by Hercules. Afghan operations have also revealed little need for this form of 'direct fire support' vehicle.] The defence minister considers such vehicles to be more useful and versatile on the modern battlefield than heavy tanks. Still, his remarks suggest that he wants to pursue a thorough review of defence policy before any more major procurement decisions are finalized. Part 1 — Summary of DND's Major Procurement Plans and Projects |