Canadian Auditor Stands By F-35

Canada: The Parliament of Canada Act mandates the Parliamentary Budget Officer (PBO) to provide independent analysis to the Senate and House of Commons on the state of the nation’s finances, government estimates and trends in the national economy.

After the release of the PBO report “An Estimate of the Fiscal Impact of Canada’s Proposed Acquisition of the F-35 Lightning II Joint Strike Fighter”, the Department of National Defence (DND) provided a comparison of its figures with those of the PBO.

On 3 March 2011, DND informed the PBO that it had not yet undertaken a ‘detailed analysis of the entire project.’

Directly prior to the PBO’s report being released, DND provided its costs with respect to acquisition, initial logistics set-up, and operating and support, among others. However, DND did not provide details of its methodology, assumptions, uncertainties, or risks associated with these figures. Given this, the PBO is left to speculate as to the basis of the costs provided.

It appears that DND has relied upon the 2009 Selected Acquisition Report (SAR), published by the U.S. Department of Defense (DoD), as well as figures provided by the Joint Strike Fighter (JSF) Program Office. However, the reasonableness of relying on such figures might be questioned. The SAR was published in April of 2010. Since then, the JSF program has undergone two restructurings to address significant program delays and cost overruns, including a restructuring of the management of the JSF Program Office (see Nunn-McCurdy breach).

Canada to Upgrade Air Force Radar Systems

Today, the Honourable Peter MacKay, Minister of National Defence, announced support for the Air Force’s vital role in the defence of Canada through significant investments in Canada’s aerospace capabilities. The projects announced today include the modernization of radar systems at 4 Wing Cold Lake and 3 Wing Bagotville, as well as the acquisition of new aircraft cargo loaders, and an upgrade to 17 Wing Winnipeg’s sewer system. Together, these investments will create or sustain an estimated total of 133 jobs across Canada.

“Our government’s investments are helping to ensure that our airmen and women have the up-to-date equipment  needed to perform their missions and build on their remarkable successes,” said Minister MacKay. “We continue to demonstrate our commitment to providing the Canadian Forces  the right equipment and facilities to do their jobs effectively.”

Minister MacKay announced a $55.6 million contract awarded to Thales Canada Inc. for the acquisition of two modern deployable, tactical control radars under the TCR modernization project. The contract provides investment in Industrial and Regional Benefits at 100 per cent of the contract value, creating approximately 40 employment opportunities.