Importantly, the CFDS has provided the guidance for development of an investment plan to implement the policy. The investment plan is a critical force development document in that it charts out expenditures for military capabilities, ensuring that they are scheduled at the appropriate time, are balanced and prioritized according to the greatest need. Needless to say, the demand for resources and funding invariably exceeds the supply so the process to establish priorities and scheduling of available money is rigorous and managed very carefully.
It should come as no surprise that times have changed since the current CFDS was released. The global recession which hit later in 2008 eventually resulted in a significant deficit in federal spending for economic stimulus initiatives. The DND budget did not escape the cuts to departmental allocations which followed. Indeed, the military has seen outright reductions from strategic review and deficit reduction initiatives, lack of funding for pay increases, capital equipment spending reprofiling, and other less apparent restrictions which collectively total about $3 billion per year in a budget of approximately $21 billion. Overall, this is a far cry from the two percent real growth proposed at the time of the CFDS creation.
The world environment and the potential demands that might be placed on the Canadian Armed Forces have also changed. The withdrawal of all major elements of military forces from Afghanistan, after 12 years of wide-ranging involvement, will be complete early this year. While a number of other, smaller international deployments will continue, none involves the commitment of personnel and resources that the missions to Afghanistan have demanded. With that intense undertaking essentially behind us, the obvious question is whether a Canadian government would ever again seriously consider another similar combat mission, given the financial cost and the risk to human life, short of a declared war. And yet, the CFDS guidance remains unchanged, leaving DND to assess the potential threats which could precipitate a deployment and the implications for existing and contemplated military capabilities.
As these fundamental changes in circumstance are evaluated it needs to be acknowledged that the full scope of equipment acquisition identified in the CFDS is not affordable. Delays in procurement, with loss of purchasing power due to inflation, have been a factor but there has always been concern that the capabilities desired were more than what the projected defence budget could accommodate. The reality is that the defence budget is smaller now and, until it is returned to initially anticipated levels and more, the CFDS can only be realistically reviewed in the context of the resources available.
To deal with this reality, some “rectification actions” are already being implemented by default through delayed acquisitions, reduction in the anticipated scope of capabilities, extension of the periods of introduction into service, and cancellation of initiatives altogether. However, these actions are often inconsistent with what was originally intended in the CFDS and are really only a stopgap, awaiting a revised policy.
Throughout, it must be recognized that defence procurement is a complex business. Even with a clearly-defined objective and the resources to proceed, it takes years to introduce a new major weapons system into service. And it will be in inventory for decades, in many cases, so it is critical to get it right.
The propensity for military staffs to extract the best capability from each procurement is commendable, but also can cause delay and indecision if fundamental development or modifications are needed, versus a more “off-the-shelf” product. No solution will ever meet the full desired requirement so it is important to recognize that compromise is necessary to ensure continued progress during implementation.
Another complication is that the competition for funding of major equipment acquisitions during any particular period traditionally creates a bow wave of demand that overwhelms the projected funding available. For example, the planned renewal of navy surface vessels is likely to be the dominant factor in managing capital procurement over the next two decades. The overlapping purchases of new fighter aircraft and army land vehicles, not to mention a myriad of other supporting or enabling projects, will demand careful management of the related sequencing of staffing, approvals and funding. The overall “choreography” of preparing and submitting project approval documentation through the various levels of bureaucracy demands an organized corporate approach.
Even so, unexpected delays can occur, which suggests that a mechanism to make adjustments should be in place. In simplistic terms, this mandates the need for over-programming. That is, the total cost of projects being executed should actually exceed the amount of funding available in order to ensure that maximum use is made of the capital allocation for approved projects when slippages occur. If, magically, there is a threat of exceeding the allocation, a delay in approvals or implementation can be invoked to stay within budget. Overall, this equates to government recognition of the need for effective risk management, something that DND has had a long history in doing effectively.
Overall then, notwithstanding the positive aspects of the CFDS initiative, its objectives cannot now be fully satisfied with the projected funding level for Defence. This reality, and the normal evolution of changing defence requirements over time, argues for a proper review of the strategy to return it to topical relevance. The need for an updated CFDS, and a resulting modified investment plan, is especially critical as DND struggles to make ends meet and to make informed decisions regarding spending priorities for capital and operating budget items.
There are several questions which should be considered in this process. Are we clear on the need to contribute to international missions consistent with our national interests? What will be the future appetite for deploying to conflict environments in the future? Should the new capabilities introduced as a direct result of the Afghan campaign (unmanned aerial surveillance, improvised explosive device countermeasures, increased armour protection, armed helicopters, etc) be retained indefinitely? Will we be able to satisfy domestic needs for military action, to include a renewed emphasis on the Arctic, at the same time as we address expeditionary demands?
More generally, will the military be able to maintain a sufficient breadth and depth of capabilities to respond to whatever contingency may arise? Will the personnel strength of the CF be appropriate to future needs and well balanced overall? And should there be a formal periodic review mechanism to update the CFDS as operational priorities and budget challenges change?
In short, the CFDS needs to be reviewed to confirm its major elements – requirements versus affordability – and to be modified in response to changing circumstances. Above all, an affordable solution is needed. This need not be a major policy review, but rather a refinement of the existing plan. It is the appropriate and responsible thing to do.
George Macdonald retired as Vice Chief of the Defence Staff in 2004 and has since worked as a consultant on defence and security issues. He is a board member of the Conference of Defence Associations Institute and a Fellow of the Canadian Defence and Foreign Affairs Institute.