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F-35 debacle spurs Tories to consider new agency for military purchases

Prime Minister Stephen Harper speaks to employees at Virtek Vision International Inc. in Waterloo Ontario March 11, 2011. They manufacture materials used in the F35 fighter jet, the procurement process for which has stirred up much public controversy.

Fred Thornhill/Reuters/Fred Thornhill/Reuters

The Conservative government is exploring handing responsibility for military procurement to a standalone agency as it tries to build a less dysfunctional process for buying defence equipment in the wake of stumbles such as the F-35 fighter project.

There is persistent unease in the Harper government over how badly defence procurement has been handled and the Conservatives have made it clear to senior civil servants, officials say, that they have tremendous interest "in doing this better."

Staff at the Department of National Defence and Public Works are researching the merits of creating a separate purchasing agency as one way of creating a more efficient means of buying defence hardware.

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"This is one idea that's being kicked around," one official said. "PMO hasn't decided what PMO wants on this yet," they said of Prime Minister Stephen Harper's office.

A separate military procurement agency has not always proved to be a sure-fire winner for other countries and critics have raised concerns about how such an entity would be independent yet sufficiently accountable to elected officials.

The search for a fix, though, is evidence of the Harper government's concern for the disturbing record of military procurement snafus that have piled up over the years.

The Conservatives tried to bring more order to military procurement last year when Mr. Harper appointed Julian Fantino as minister responsible for the portfolio. But the Auditor-General's damning April report on mishandling of the F-35 jet purchase, and other purchasing troubles, have focused more attention on the problem.

The Defence Department is expected to resist setting up an arms-length agency that would effectively reduce its power and influence over billions of dollars in military purchasing, and will likely argue it's more practical to merely tinker with the status quo.

DND has taken flak for decades of controversial purchases, from second-hand submarines that failed to meet basic expectations to new top-of-the-line maritime helicopters that are four years late, with no firm delivery date in sight.

The Conservative government has succeeded in buying two fleets of tactical and strategic transport planes in recent years, relying on sole-source purchases of off-the-shelves aircraft instead of buying products that were still in developmental stages.

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But other procurements are bogged down in problems. Plans to buy a new fleet of transport helicopters as well as search-and-rescue planes have yet to get off the ground, as government officials struggle with budgetary and technical challenges.

In many cases, DND tries to "Canadianize" its purchases, seeking complex and expensive modifications to suit its unique needs.

At other times, technical requirements prove too complex. Last month, the government told manufacturers that it had to start anew on a $2-billion Close Combat Vehicle program because none of their proposals were fully compliant.

The Auditor-General has been particularly harsh about military purchases over the years, criticizing a number of big-ticket purchases that were conducted without a full and open competition.

Canada is not the only country struggling with military procurement. In 2005, Australia granted more autonomy to its Defence Materiel Organization in a bid to improve the efficiency of the agency that oversees military purchases.

However, the Australian entity found itself under attack last year after a series of procurement bungles including delays and cost overruns for artillery and warship acquisitions.

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About the Authors
Parliamentary reporter

Steven Chase has covered federal politics in Ottawa for The Globe since mid-2001, arriving there a few months before 9/11. He previously worked in the paper's Vancouver and Calgary bureaus. Prior to that, he reported on Alberta politics for the Calgary Herald and the Calgary Sun, and on national issues for Alberta Report. More

Parliamentary reporter

Daniel Leblanc studied political science at the University of Ottawa and journalism at Carleton University. He became a full-time reporter in 1998, first at the Ottawa Citizen and then in the Ottawa bureau of The Globe and Mail. More

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