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2008-09
Departmental Performance Report



National Defence





Supplementary Information (Tables)





Table of Contents




Sources of Respendable and Non-Respendable Revenue


Respendable Revenue
Program
Activity
($ thousands)		 Actual
2006-07		 Actual
2007-08		 2008-09
Main
Estimates		 Planned
Revenue		 Total
Authorities		 Actual
Generate and Sustain Relevant, Responsive and Effective Combat-Capable Integrated Forces
Recoveries from Members 124,849 132,345 115,380 115,380 139,198 139,198
Recoveries from OGDs 5,432 5,708 3,636 3,636 6,093 6,093
Recoveries from Other Governments/UN/NATO 16,993 889 14,972 14,972 645 645
Other Recoveries 45,965 41,077 34,247 34,247 63,224 63,224
Subtotal 193,239 180,019 168,235 168,235 209,159 209,159
Conduct Operations
Recoveries from Members 3,470 2,362 1,169 1,169 2,584 2,584
Recoveries from OGDs 697 522 155 155 554 554
Recoveries from Other Governments/UN/NATO 20,224 18,617 8,373 8,373 23,640 23,640
Other Recoveries 3,688 1,673 526 526 6,281 6,281
Subtotal 28,079 23,175 10,223 10,223 33,059 33,059
Contribute to Canadian Government, Society and International Community in Accordance with Canadian Interests and Values
Recoveries from Members 831 616 890 890 560 560
Recoveries from OGDs 10,168 7,330 1,833 1,833 10,705 10,705
Recoveries from Other Governments/UN/NATO 196,052 211,517 203,666 203,666 242,218 242,218
Other Recoveries 6,247 21,584 16,738 16,738 5,788 5,788
Subtotal 213,298 241,047 223,127 223,127 259,270 259,270
Total Respendable Revenue 434,616 444,242 401,586 401,586 501,489 501,489


Non-Respendable Revenue
Program Activity
($ thousands)		   Actual  
2006-07		   Actual  
2007-08		 2008-09
Main
Estimates		 Planned
Revenue		 Total
Authorities		 Actual
Generate and Sustain Relevant, Responsive and Effective Combat-Capable Integrated Forces            
Return on investments 9,030 4,669 N/A - - 2,222
Refunds of previous years' expenditures 64,535 48,421 N/A 26 26 50,757
Proceeds from disposal of surplus Crown assets 19,200 15,149 N/A 83 83 12,241
Other revenue 9,674 28,903 N/A 431 431 6,949
Subtotal 102,439 97,143 0 539 539 72,169
Conduct Operations            
Return on investments 70 93 N/A - - 287
Refunds of previous years' expenditures 10,357 10,214 N/A 2 2 9,729
Proceeds from disposal of surplus Crown assets 994 1,688 N/A - - 2,264
Other revenue 1,516 5,576 N/A 94 94 1,335
Subtotal 12,937 17,571 0 96 96 13,615
Contribute to Canadian Government, Society and International Community in Accordance with Canadian Interest and Values
Return on investments 300 25 N/A - - 66
Refunds of previous years' expenditures 2,894 5,330 N/A 2 2 5,505
Proceeds from disposal of surplus Crown assets 276 563 N/A - - 424
Other revenue 964 3,515 N/A 620 620 7,162
Subtotal 4,435 9,433 0 621 621 13,156
Total Non-respendable Revenue 119,811 124,147 0 1,257 1,257 98,807

Source: Assistant Deputy Minister (Finance and Corporate Services) Group
* Due to rounding, figures may not add up to totals shown.
Note:
1. The Respendable Revenues are $99.9 million higher than initial Planned Revenues due to the following: an increase in Revenue of $53.7 million associated with increased recoveries from foreign militaries for training, fuel, facilities operating costs, communications and North Warning System cost sharing arrangements, an increase of $16.7 million for recoveries from the Canadian Forces Pension Plans due to the in-year approval of the change in administrative cost recoveries, an increase in sales of other goods of $15.7 million, an increase in sales of food services according to Queen's Regulations and Orders of $6.1 million and $7.7 million from a number of diverse financial recovery areas.


Details on Project Spending (Capital Equipment Program over $30 Million)

Projects listed in the table below have been identified as either: (1) projects in which the estimated expenditure exceeds the delegated approval authority granted to DND by the Treasury Board ($30 million with substantive cost estimates), or (2) projects in which the risk is particularly high, regardless of the estimated amounts.


Project Number Project Title Phase Main Estimates 2008-09 Total Estimated Cost Current Estimated Total Cost ($000) Previous Expenditures to end
 2007-08
($000)		 Planned Spending
2008–09 ($000)		 Actual Spending
2008–09 ($000)		 VARIANCE ($000)
Program Activity - Generate and Sustain Integrated Forces
MARITIME EFFECTS
1216 Arctic Offshore Patrol Ship D/I 42,434 34,905 2,001 13,829 6,521 7,308
2549 Canadian Submarine Capability Life Extension I 887,856 896,772 43,212 37,000 23,407 13,593
2573 Maritime Environmental Protection Project I 61,119 55,507 1,834 2,200 1,849 351
2586 Halifax Class Modernization/Frigate Life Extension D 800,951 2,353,370 10,728 52,791 50,713 2,078
2640 Evolved Sea Sparrow Missiles I 505,205 504,936 2,088 8,719 1,547 7,172
2664 Advanced Electro-optic Sensor I 240,499 219,027 40,586 39,837 33,245 6,592
2673 Joint Support Ship D/I 50,204 67,300 23,308 4,114 4,992 (878)
2796 YAG 300 Training Vessel Replacement I 93,039 92,152 20,687 9,155 10,907 (1,752)
  TOTAL MARITIME EFFECTS   2,681,307 4,223,969 144,444 167,645 133,181 34,464
 
LAND EFFECTS
58 Wheeled Light Armoured Vehicle Life Extension I 160,455 160,454 16,753 29,663 17,152 12,511
84 Army GPS Equipment Replacement I 40,509 39,453 6,368 8,185 3,239 4,946
224 Defence Information Broker I 36,370 39,579 13,877 2,300 4,330 (2,030)
1017 Lightweight 155mm Towed Howitzer (M777 LWTH ) I 59,608 25,974 11,469 10,502 6,098 4,404
1070 Armoured Patrol Vehicle I 116,603 123,074 19,588 5,795 3,446 2,349
1111 CF EOD Team Equipment D 33,245 33,450 5,228 16,412 1,098 15,314
1203 Armoured Heavy Support Vehicle I 150,030 148,183 96,739 60,066 76,336 (16,270)
1204 Light Armoured Vechicle Remote Weapon System I 44,441 42,039 7,907 33,000 15,109 17,891
1241 Main Battle Tank I 208,882 578,724 99,008 58,291 37,883 20,408
1242 Improvised Explosive Device and Mine Protection Kits (IEDM PK) I 45,965 39,451 8,673 19,929 11,066 8,863
1436 Low Level Air Defence Modernization I 1,091,549 36,718 8,642 5,928 9,050 (3,122)
2058 Weapons Effect Simulator I 123,993 120,749 17,599 12,785 4,335 8,450
2346 Medium Support Vehicle System I 1,066,680 1,114,024 5,222 10,364 5,119 5,245
2637 Armoured Personnel Carriers I 2,326,668 2,348,900 76,375 120,363 30,607 89,756
2731 Armoured Personnel Carriers Life Extension I 347,637 278,929 12,527 19,529 16,218 3,311
XXXX Clothe The Soldier Omnibus Project I 273,237 217,183 21,341 51,690 59,313 (7,623)
TOTAL LAND EFFECTS 6,125,872 5,346,884 427,316 464,802 300,399 164,403
 
  AEROSPACE EFFECTS              
86 Operational Flight Program I 111,520 111,520 7,467 12,148 11,800 348
113 Advanced Distributed Combat Training System I 187,742 187,742 5,606 10,899 7,695 3,204
180 CF-18 Multi-purpose Display Group Project I 61,925 61,959 0 99 1 98
273 CF-18 Advanced Multi-role Infrared Sensor I 186,059 186,060 34,591 47,222 47,931 (709)
295 Aurora Communication Management System Replacement I 89,745 89,745 3,078 13,700 7,124 6,576
317 Aurora Electro-optical System Replacement I 49,162 49,162 2,143 827 416 411
410 Aurora - Flight Deck Simulator I 40,862 40,862 682 3,083 457 2,626
423 Aurora - Electronic Support Measures Replacements I 194,457 194,457 11,944 33,675 8,435 25,240
428 Aurora - Imaging Radar Acquisition I 280,020 280,018 30,940 35,903 35,426 477
451 Primrose Lake Evaluation Range TSPI System I 33,443 39,064 4,016 2,750 2,152 598
536 Aurora - Operator Mission Simulator I 44,633 44,633 7,251 3,346 4,311 (965)
548 Aerodrome Precision Approach and Landing Systems (APALS) D 47,104 47,007 363 4,341 429 3,912
583 CF18 - Engineering Change Proposal 583 I 854,309 854,309 23,656 5,516 2,549 2,967
609 Fixed Wing Search and Rescue Project D 7,357 0 0 0 0 0
627 CF18 Defensive Electronic Warfare Suite I 177,981 177,981 5,681 38,568 19,157 19,411
646 Omnibus Night Vision Capability (Omnibus) I 34,713 25,591 2,286 9,700 1,344 8,356
743 Tactical Control Radar Modernization I 39,019 39,019 1,025 7,850 0 7,850
1007 Medium to Heavy Lift Helicopters D 2,014,542 0 6,153 100,264 5,127 95,137
1036 Airlift Capability Project (Tactical) I 3,061,277 3,062,982 159,209 603,577 459,147 144,430
1117 Airlift Capability Project (Strategic) I 1,805,752 1,451,555 928,405 256,485 181,076 75,409
1686 CF18 - Advanced Air to Air Weapon - Short Range I 36,685 36,685 78 2,422 0 2,422
2320 Military Automated Air Traffic System I 156,922 156,339 2,143 3,593 3,284 309
2371 Advanced Navigation and Precision Approach I 97,830 97,989 5,658 15,259 2,909 12,350
2398 Joint Command System I 30,583 48,245 3,621 3,103 2,532 571
2517 Canadian Forces Utility Tactical Transport Helicopters I 1,093,098 1,086,133 4,133 5,640 3,479 2,161
2526 Region/Sector Air Operation Centre I 137,568 140,368 2,964 5,401 5,022 379
2619 Air Combat Manoeuvering Instrumentation System I 33,289 31,554 580 0 62 (62)
2657 CC150 Strategic Air-to-Air Refuelling (SAAR) I 132,175 13,672 9,942 6,750 5,112 1,638
2659 CF18 Advanced Precision Guided Munition I 55,243 55,243 2,064 30,410 10,018 20,392
2678 Canadian Search and Rescue Helicopter I 774,445 27,281 1,037 5,480 154 5,326
2680 Maritime Helicopters I 3,160,349 3,160,349 143,665 416,554 416,324 230
2754 CF-18 Advanced Medium Range Air-to-Air Missile I 100,508 100,250 4,973 5,375 469 4,906
5832 CF18 - Engineering Change Proposal - Phase 2 I 423,280 423,281 56,036 71,870 65,388 6,482
TOTAL AEROSPACE EFFECTS 15,553,598 12,321,053 1,471,390 1,761,810 1,309,330 452,480
 
JOINT, NATIONAL, UNIFIED, and SPECIAL OPERATIONS
402 Canadian Forces Joint Experimentation I 33,805 6,664 571 2,000 287 1,713
439 Allied Vaccine Development Project I 33,862 28,208 1,593 3,698 814 2,884
625 Polar Epsilon Joint Space-Based Wide Area Surveillance and Support I 27,436 42,462 3,502 4,830 4,105 725
675 Chemical Agent Sensor ( CAS ) I 65,325 65,325 2,533 25,066 5,378 19,688
2469 Canadian Forces Command System I (CFCS) I 67,212 67,017 1,890 1,200 354 846
2556 Canadian Forces Point Biological Agent Detection, Sampling and Identification Project I 40,049 42,271 15,080 12,900 7,690 5,210
2800 Canadian Forces Health Information System I 79,953 107,650 14,057 5,425 17,747 (12,322)
3667 Surveillance of Space (SofS Project ) I 82,487 83,876 6,911 13,612 14,868 (1,256)
Various Canadian Cryptographic Modernization Project D/I 52,049 111,073 41,298 9,770 9,991 (221)
TOTAL JOINT, NATIONAL, UNIFIED, and SPECIAL OPERATIONS 482,178 554,546 87,435 78,501 61,234 17,267
 
TOTAL GENERATE and SUSTAIN INTEGRATED FORCES 24,842,955 22,446,452 2,130,585 2,472,758 1,804,144 668,614
 
Program Activity - Conduct Operations
 
CONSTANT SITUATIONAL AWARNESS
276 Intelligence, Surveillance, Target Acquisition & Reconnaissance D/I 100,991 312,409 7,010 9,132 5,927 3,205
1012 LF ISTAR - Datalink Communications D 94,161 90,233 17,488 51,462 9,310 42,152
2803 Protected Military Satellite Communication I 531,467 468,019 24,029 23,020 6,102 16,918
TOTAL CONSTANT SITUATIONAL AWARNESS 726,619 870,661 48,527 83,614 21,339 62,275
 
Program Activity - Executive and Corporate Services
 
2272 Materiel Acquisition and Support Information System I 333,014 186,571 17,439 35,712 36,032 (320)
2400 Defence Integrated Human Resource System I 94,259 98,045 10,915 2,940 4,300 (1,360)
2536 Role Three Health Support I 42,453 42,453 0 2,212 0 2,212
TOTAL EXECUTIVE and CORPORATE SERVICES 469,726 327,069 28,354 40,864 40,332 532
 
TOTAL PROGRAM ACTIVITIES 26,039,300 23,644,182 2,207,466 2,597,236 1,865,815 731,421

Source: Assistant Deputy Minister (Materiel) Group
Legend: D = Definition, I = Implementation


Status Report on Major Crown Projects

AIRLIFT CAPABILITY PROJECT - STRATEGIC (ACP-S)

Description: The objective of the Airlift Capability Project - Strategic is to acquire four new aircraft that will provide the global reach and speed necessary to operate effectively over long distances to deliver personnel and cargo directly into a theatre of operations, including a threat environment.

Project Phase: Implementation. All four aircrafts have been accepted on schedule and Close-Out is expected for summer 2012.


Leading and Participating Departments and Agencies
Lead Department or Agency Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments and Agencies Industry Canada and its Regional Agencies


Prime and Major Sub-Contractors
Prime Contractor The Boeing Company, St-Louis, Missouri, USA


Major Milestones
Major Milestones Date
Synopsis Sheet (Effective Project Approval) June 2006
Advanced Contract Award Notice Posted on MERX July 2006
Contract Award February 2007
Delivery First Aircraft August 2007
Delivery Second Aircraft October 2007
Delivery Third Aircraft March 2008
Delivery Fourth Aircraft April 2008
Initial Operational Capability (IOC) October 2008
Full Operational Capability (FOC) Spring 2012
Project Close-out Summer 2012

Progress Report and Explanations of Variances: All four aircraft have been accepted on schedule and have completed close to 5,000 flying hours. The project office is currently working on the Implementation Phase in support of this acquisition. Due to complexities in transitioning to in-service support, Final Operational Capability (FOC) will be delayed to Spring 2012 when the Trenton infrastructure is completed and the Squadron can sustain all Lines of Tasking and all planned mission types as stated in the Statement of Operational Capability. The project will close-out after FOC.

Industrial Benefits: Industrial and Regional Benefits (IRBs) are equivalent to 100% of the acquisition contract, Boeing's share of the in-service support Foreign Military Sales contract value and the value of the engines. (A separate IRB agreement was negotiated with Pratt and Whitney USA for the value of the engines for the C-17). The three IRB agreements total $1.9B. Several IRB announcements have been made and all regions of Canada will benefit from these contracts.

AIRLIFT CAPABILITY PROJECT - TACTICAL (ACP-T)

Description: The objective of the Airlift Capability Project - Tactical is to ensure a continued tactical airlift capability. In combination with the Fixed Wing Search and Rescue project, this project will replace the Canadian Forces' ageing CC 130E/H Hercules fleet. This project will provide the Canadian Forces with an assured and effective tactical airlift capability that allows the requisite operational flexibility and responsiveness to support international and domestic operations.

Project Phase: Implementation. The ACP-T project entered the Implementation Phase with the December 2007 contract award to Lockheed Martin Corporation for 17 C-130J-30 aircraft. Aircraft deliveries will commence no later than June 2010, with the final aircraft delivered no later than December 2012.


Leading and Participating Departments and Agencies
Lead Department Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments Industry Canada and its Regional Agencies


Prime and Major Sub-Contractors
Prime Contractor Lockheed Martin Corporation, Marietta, Georgia, USA


Major Milestones
Major Milestones Date
Revised Preliminary Project Approval (PPA) June 2006
Solicitation of Interest and Qualification (SOIQ) August 2006
Issue of Request For Proposal (RFP) August 2007
Effective Project Approval December 2007
Contract Award December 2007
First Aircraft Delivery Fall/Winter 2010
Initial Operational Capability (IOC) Fall 2011
Full Operational Capability (FOC) Winter 2013/2014
Project Close-out Spring 2014

Progress Report and Explanations of Variances: Under the agreement of the December 2007 contract award, Lockheed Martin Corporation is required to undertake an open and fair competitive solicitation for the provision of in-service support. The outcome of this Contractor-led solicitation would be one of many deliverables from the contract and will form the basis of a negotiation for amendments to the contract to include in-service support provisions. The in-service support effort will include contractor provided support to: logistics, engineering, maintenance, material, publications, maintenance training, test equipment and electronic information environment.

The ACP-T project is currently running on schedule and on budget.

Industrial and Regional Benefits: This procurement will provide industrial regional benefits equivalent to 100% of the contracted value for both the capital acquisition and in-service support. For the in-service support portion, 75% of the contract value will be direct work performed by Canadian companies. Lockheed Martin Corporation will be required to identify, as specific work packages, 60% of the total acquisition commitment. These Industrial and Regional Benefits requirements will be negotiated and accepted by Industry Canada prior to the in-service support contract amendment signing.

ARCTIC/OFFSHORE PATROL SHIP (A/OPS)

Description: The Arctic/Offshore Patrol Ship (A/OPS) project has been established in order to deliver to the Government of Canada a naval ice-capable offshore patrol ship to assert and enforce sovereignty in Canada's waters including the Arctic. When the project completes, the six to eight fully supported A/OPS delivered to the Canadian Forces will be capable of:

  • Conducting armed, sea-borne surveillance of Canada's waters, including the Arctic;
  • Providing to Government situational awareness of activities and events in these regions; and
  • Cooperating with other elements of the Canadian Forces and other Federal Government departments to assert and enforce Canadian sovereignty, when and where necessary.

Project Phase: Definition/Implementation


Leading and Participating Departments and Agencies
Lead Department or Agency Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments and Agencies Industry Canada and the regional agencies

Prime and Major Sub-Contractors

No prime contractor has been selected. Final selection of the prime contractor will occur at Effective Project Approval, planned for January 2011.


Major Milestones
Major Milestones Date
Treasury Board Preliminary Project Approval May 2007
Release of Definition, Engineering, Logistics and Management Support Request for Proposals (DELMS RFP) December 2007
DELMS RFP Close February 2008
DELMS Contract Award May 2008
Effective Project Approval (SS(EPA)) January 2011
Award of Implementation Contract August 2010
Delivery of First Ship Fall 2014
Initial Operating Capability (IOC) of First Ship March 2015
Project Complete March 2021

Progress Report and Explanations of Variances: The project continues to progress steadily since obtaining Preliminary Project Approval in May 2007. Treasury Board granted expenditure authority of $42.465M ($BY), full up including GST, for Definition Phase. Treasury Board also acknowledged the indicative full up cost of $3,231.7M ($BY) including GST, for acquisition. So far, no variances in cost estimates have been identified. A/OPS is expanding on the Definition Phase to produce a design that will be included as part of the RFP, ensuring that it meets the requirements, and can be used by potential bidders.

Industrial and Regional Benefits: Industrial and Regional Benefits (IRBs) for this project are equivalent to 100% of the contracted value for both the capital acquisition and in-service support.

ARMOURED PERSONNEL CARRIERS (APC)

Description: The Armoured Personnel Carrier (APC) is essential for all foreseeable Canadian Forces roles, including territorial defence, UN peacekeeping and peace enforcement operations, other international commitments, and Aid of the Civil Power. The existing APC fleet does not meet the minimum operational requirements when compared to the modern, technically sophisticated weapons and vehicles Canadian soldiers encounter during operations. They suffer shortcomings in protection, self-defence capability, mobility, carrying capacity and growth potential. The APC Project is fielding a fleet of modern, wheeled, armoured personnel carriers. 651 Light Armoured Vehicles (LAV) III are to be procured in six configurations: Infantry Section Carrier, Command Post, Engineer, Forward Observation Officer, and TOW (Tube Launched, Optically Tracked, Wire Guided) Under Armour, and LAV III Less Kits.

Project Phase: Implementation. All vehicles were delivered by October 2007 and construction activities for indoor accommodation are well under way. The project is scheduled for completion in March 2011.


Leading and Participating Departments and Agencies
Lead Department Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments and Agencies Industry Canada and its regional agencies


Prime and Major Sub-Contractors
Prime Contractor General Dynamics Land Systems - Canada, London, ON


Major Milestones
Major Milestones Date
Treasury Board Approval December 1995
Contract Award December 1996
First Vehicle Delivery July 1998
Exercise of First Option July 1998
Exercise of Second Option July 1999
Exercise of Third Option July 1999
Last Vehicle Delivery October 2007
Project Completed March 2011

Progress Report and Explanation of Variances: In August 1995, the Government approved in principle the procurement of up to 651 APCs. In January 1997, the Government announced the award of a contract to General Dynamics Land Systems - Canada (GDLS-C) to build 240 new eight-wheel-drive APCs. The contract contained three options for an additional 120, 120 and 171 APCs. All three options have been exercised. All vehicles were delivered by October 2007.

The vehicles have been involved in significant operational demands after being fielded and have performed well. They have since undergone a number of modifications to adjust to the modern threat, and will require additional work to optimize performance against these threats. Planning is currently underway to address this issue.

In March 2004, Treasury Board authorized $129M for indoor accommodation for LAV III to facilitate regular maintenance and training programs, and prevent any deterioration that would result from outdoor storage. Construction will take place in six locations: Edmonton, Wainwright, Petawawa, Montréal, Valcartier, and Gagetown. Construction activities are well under way and are scheduled for completion in early 2011. The project can then close in March 2011.

Industrial Benefits: This project includes the following overall industrial benefits, and regional and small business achievements:


Content Benefits
Direct $852.9M
Indirect $742.9M
Total $1,595.8M
Regional And Small Business Benefits
Atlantic Canada $151.4M
Québec $150.6M
Western Canada $155.0M
Small Business $210.3M

CANADIAN CRYPTOGRAPHIC MODERNIZATION PROGRAM (CCMP)

Description: The Canadian Cryptographic Modernization Program (CCMP) is a 12-year program (fiscal year 2004-2005 to 2015-2016) that will modernize the Government of Canada's aging cryptographic equipment and infrastructure in order to safeguard classified information and maintain Canada's ability to establish secure communications both nationally and internationally. The CCMP Omnibus Project includes the following sub-projects:

  • Secure Voice / Telephone Re-key Infrastructure
  • Secure Voice / Telephone Family
  • Classified Security Management Infrastructure (CSMI)
  • Combat Identification Family
  • Link Encryption Family
  • Network Encryption Family
  • Secure Radio Family
  • Secure Mobile Environment

Project Phase: Implementation for some sub-projects and Definition for others.


Leading and Participating Departments and Agencies
Lead Department Communications Security Establishment Canada (CSEC)
Contracting Authority Public Works & Government Services Canada (PWGSC)
Participating Departments and Agencies Government of Canada departments & agencies using cryptographic equipment to protect classified information


Prime and Major Sub-Contractors
Prime Contractor N/A
Major Sub-Contractors Various allied manufacturers of cryptographic equipment


Major Milestones
Project / Sub-project Major Milestone Date
Preliminary Project Approval for the CCMP Omnibus Project March 2005
Preliminary Project Approval for a CCMP Omnibus Project sub-project:
Classified Security Management Infrastructure		 November 2006
Secure Voice/Telephone Re-key Infrastructure - Initial Operational Capability December 2006
Secure Voice/Telephone Re-key Infrastructure - Full Operational Capability June 2009
Classified Security Management Infrastructure - Phase 1 Completed 2011
Secure Voice/Telephone Replacement - Completed December 2011
Secure Mobile Environment - Completed 2012
Link Encryption Replacement - Completed 2013
Classified Security Management Infrastructure - Phase 2 Completed 2014
Network Encryption Replacement - Completed 2014
Classified Security Management Infrastructure - Phase 3 Completed 2016
Combat Identification Replacement - Completed 2016
Secure Radio Replacement - Completed 2016
CCMP Omnibus Project - Completed 2016

Progress Report and Explanations of Variances: Fiscal year 2008-09 was the fifth year of this 12-year program. The CCMP is executing within budget.

In March 2005, Treasury Board granted Preliminary Project Approval to the CCMP Omnibus Project at an estimated full-up cost of $839M with expenditure authority for the project definition phases and management of the program at a substantive full-up cost estimate of $80M.

In November 2006, Treasury Board granted Preliminary Project Approval to the Classified Security Management Infrastructure project at an estimated full-up cost of $182M with expenditure authority for the implementation of Phase 1A at a substantive full-up cost estimate of $31M.

In February 2008, the Secretary to the Treasury Board granted expenditure authority for a subsequent phase of the CSMI project; i.e., implementation of Phase 1B at a substantive full-up cost estimate of $12M, and definition of Phase 2 at a substantive full-up cost estimate of $3M.

The following completion dates have changed from those recorded in the CCMP Omnibus Project PPA approved in March 2005.

  • Secure Voice Re-key Infrastructure close-out was moved to September 2009 in order to incorporate stronger security for re-keying new secure phones. This sub-project achieved Initial Operational Capability on schedule in December 2006, and Full Operational Capability in June 2009. This will be the first sub-project under the CCMP umbrella to reach completion.
  • Secure Voice/Telephone Replacement close-out was moved to December 2011 in order to coordinate software upgrades needed by the new secure phones for interoperability and improved information protection.
  • Classified Security Management Infrastructure Phase 1 completion was moved from 2008 to 2011. Phase 1 was divided into Phase 1A and 1B to reduce the complexity of managing the project.
  • Combat Identification Replacement completion was moved from 2010 to 2016 due to changes in the US program schedule.
  • Classified Security Management Infrastructure Phase 2 close-out was moved from 2011 to 2014 due to delays in the US Key Management Infrastructure program.
  • Link Encryption Replacement completion will occur ahead of schedule in 2013. The first two milestones have been met and the sub-project is on track to meet the December 2009 milestone. Thirty-five percent of the GC link encryption devices, which encrypt information during transmission between two points, have been replaced.
  • Network Encryption Replacement completion was moved from 2011 to 2014 to align with the implementation schedule in DND.
  • Secure Mobile Environment is a new crypto family that was added to the CCMP in June 2007. Handheld wireless devices designed to handle classified information are currently being tested and evaluated.

Industrial Benefits: N/A

CANADIAN FORCES SUPPLY SYSTEM UPGRADE (CFSSU)

Description: The Canadian Forces Supply System Upgrade (CFSSU) project will meet the future supply requirements of the Canadian Forces during all operational situations while effectively and economically managing the Department of National Defence inventory. The system will have an inherent flexibility to manage changes in force structure, size and all types of missions. The CFSSU project will employ information technology to modernize Canadian Forces military supply operations. Not only will this technology dramatically improve productivity, it will also enhance the capability for performance measurement, greatly increase asset visibility, and provide a powerful management tool for provisioning. Additionally, the new supply system will have a deployed capability. The deployed solution is complementing the existing September 2001 corporate implementation to Bases and Wings, as well as the November 2002 implementation, which include all remaining CFSS users, at home and overseas.

Project Phase: Close-Out. CFSS Deployed has been implemented on 17 ships as well as at two sites for CANSOFCOM.


Leading and Participating Departments and Agencies
Lead Department or Agency Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments and Agencies Industry Canada and its regional agencies


Prime and Major Sub-Contractors
Prime Contractor EDS Canada Inc. Ottawa, Ontario, Canada
Major Sub-Contractors Mincom Pty. Ltd. Brisbane, Australia
ADGA Group Ottawa, Ontario, Canada


Major Milestones
Major Milestone Date
Contract Award January 1995
Initial Site Installation December 1995
Warehouse Management Information System Delivery July 1997
Test Development Centre Delivery October 1999
Commence System Development November 1999
Complete System Development March 2001
Commence System Pilot June 2001
Complete System Pilot August 2001
Commence System Rollout September 2001
Complete System Rollout June 2003
(official acceptance)
Project Close-out (E Status) September 2004
Project Close-out (I Status) Spring 2010

Progress Report and Explanations of Variances: Treasury Board initially approved the CFSSU project with an estimated cost of $289.3M. The Treasury Board approved in April 2000, the de-scoping of certain functionality and an increase to project contingency funding of $9.8M. In addition, $5M was approved in order to permit DND the option of restoring the Distribution Resource Planning (DRP) component. The Implementation Phase of DRP was de-scoped and the project budget remained at $304.1M.

The CFSSU Project has been transferred from implementation to Close-out in September 2004. Close-out funding is $3.6M. In March 2006, DND Program Management Board approved the usage of Close-out funds for the project; these funds are to be used until fully expended or the work is completed. This pproject is closed and all Close-out funds and related activities will have ended as of the end of fiscal year 2009-10.


Industrial and Regional Benefits
Region Benefits
Atlantic Canada $51M
Québec $48M
Ontario $26M
Western Canada $105M
Unallocated $10M
Total $240M

CANADIAN FORCES UTILITY
TACTICAL TRANSPORT HELICOPTER (CFUTTH) PROJECT

Description: The purpose of the Canadian Forces Utility Tactical Transport Helicopter (CFUTTH) Project is to acquire helicopters in support of national and international tactical aviation roles. The project supports the Land Force, Air Force, Canadian Expeditionary Force Command (CEFCOM) operations and Civil Emergency Preparedness, as well as a wide range of defence objectives. It has replaced three aging helicopter fleets - the CH118 Iroquois, the CH135 Twin Huey and the CH136 Kiowa. The Bell 412CF/CH146 was procured as a single role multi-mission helicopter capable of supporting a majority of the tasks previously undertaken by fleets it replaced. The operational requirements for the CFUTTH defined the principle task requirements to include the tactical lift of troops, logistical lift, reconnaissance and surveillance, direction and control of fire, aero-medical support and casualty evacuation, command and liaison, and communications assistance. These mission capabilities are employed in support of DND operational commitments, United Nations peacekeeping missions, and support to other Government Departments and Agencies, including aid of the civil power.

Project Phase: Implementation. The project has delivered 100 Bell 412CF/CH146 Griffons, a flight simulator, composite maintenance trainer, facilities, mission kits (including defence electronic warfare suites), as well as other equipment, documentation and services. It is scheduled for completion in November 2009.


Leading and Participating Departments and Agencies
Lead Department Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments Industry Canada and its regional agencies


Prime and Major Sub-Contractors
Prime Contractor Bell Helicopter Textron Canada, Mirabel, QC
Major Sub-Contractors Pratt & Whitney Canada, Montréal, QC
BAE Systems Canada Inc., Montréal, QC
CAE Ltd., Montréal, QC


Major Milestones
Major Milestone Date
Contract Award September 1992
Critical Design Review April 1993
First Helicopter Delivery March 1995
Simulator Acceptance June 1996
Last Helicopter Delivery December 1997
Project Completion November 2009

Progress Report and Explanation of Variances: This project received Government approval in April 1992 and Treasury Board approval in September 1992, with an original budget of $1.293B. Following directed reductions to the project budget and by assuming certain performance risks, the project will be completed in November 2009 for approximately $200M less than the initial Treasury Board budget approval. Remaining work consists of modifying the CH146 to accommodate the Radar Laser Warning Receiver (RLWR) functionality as well as the implementation of the Single-Channel Ground and Airborne Radio System (SINCGARS) capability.

Industrial Benefits: To date, Bell Helicopter has claimed $289.5M direct and $252.1M indirect industrial regional benefits, totalling $541.6M, representing 107% of the overall commitment. Bell Helicopter Textron Canada has committed to achieving $506.7M in Canadian value-added industrial regional benefits as follows:


Region Cash Benefits
East $10.0M
Québec $420.2M
Ontario $32.1M
West $12.0M
Unallocated $32.4M
Total $506.7M

CANADIAN SEARCH AND RESCUE HELICOPTER (CSH) PROJECT

Description: Maintaining a national search and rescue capability is a direct departmental objective. The purpose of the Canadian Search and Rescue Helicopter (CSH) project was to replace the CH-113 Labradors with a fleet of 15 new helicopters. The new helicopters have addressed the operational deficiencies of the CH-113 Labrador fleet and eliminated the supportability difficulties of the older airframes. Given expected aircraft availability rates and a sufficient fleet size, continuous operations are anticipated well into the 21st century.

Project Phase: Completed. As of July 2003, all 15 Cormorant helicopters have been delivered. Spare parts and infrastructure are in place to support operations. Initial training is complete. Effective Project Closure was achieved in September 2004, but some work is still ongoing and full completion is not expected before 2013.


Leading and Participating Departments and Agencies
Lead Department Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Department Industry Canada and its regional agencies


Prime and Major Sub-Contractors
Prime Contractor Agusta Westland International Limited (formerly E.H. Industries Ltd. (EHI)),
Farnborough, United Kingdom
Major Sub-Contractors GKN Westland Helicopters, United Kingdom
Agusta Spa, Italy
General Electric Canada Inc., Canada


Major Milestones
Major Milestone Date
Treasury Board Effective Project Approval April 1998
Contract Award April 1998
First Aircraft Delivery (at plant in Italy) September 2001
Final Aircraft Delivery (at plant in Italy) July 2003
Project Completion (Effective Project Completion) September 2004
Expected Project Closure 2013

Progress Report and Explanation of Variances: The project has procured the required aircraft spares, maintenance and support equipment, a Cockpit Procedures Trainer and facilities for the four Canadian Forces search and rescue bases. The project has also established and funded the first two years of an in-service support contractor for follow-on support.

The Cormorant has been operational at the squadrons in Comox, BC, Gander, NF, Greenwood, NS and Trenton, ON. However, CH149 operations at 424 Squadron in Trenton have been suspended temporarily due to the lack of aircraft availability and difficulty to maintain adequate aircrew training.

It should be noted that although Effective Project Closure was achieved in September 2004, some work is still ongoing and full completion is not expected before 2013. The milestones still outstanding are tied to a three year Technical Publication Revision Service which is not expected to begin until fiscal year 2012-2013, and a number of milestones related to outstanding aircraft deficiencies which are expected to take at least two years to address.

Industrial and Regional Benefits: The contractor (AWIL) committed to providing direct and indirect industrial benefits valued at $629.8M, within eight years from the date of contract award. It is estimated that these benefits created or sustained roughly 5,000 person-years of employment in Canada, and that all regions of Canada benefited from this project. The contractor has completed its obligations to Canada in regard to Industrial and Regional Benefits under the CSH contract. Small businesses in Canada will also benefit from the project by the placing of $67.0M in orders.


Region Cash Benefits
Atlantic Canada $43.1M
Québec $317.7M
Ontario $146.5M
Western Canada $86.2M
Unallocated $36.3M
Total $629.8M

HALIFAX CLASS MODERNIZATION/FRIGATE LIFE EXTENSION (HCM/FELEX)

Description: The HCM/FELEX project is the principal component of the overall HALIFAX Class modernization (HCM) initiative. The project will plan and manage HALIFAX Class mid-life refits, acquire the major elements of the new combat system, and deliver stability enhancements, degaussing improvements and a Commander Task Group capability in four ships. As the Design Integration Authority for the HCM, PM HCM/FELEX is responsible for the ship level design integration of all elements of the HCM including any unique/specific engineering changes required to address integration requirements. To ensure that the overall modernization initiative is achieved in a timely, efficient and coordinated manner, the HCM/FELEX project will conduct overall design integration, coordinate schedules, manage inter-project risk, and manage equipment installation during the mid-life refits. Major equipment acquisitions through HCM/FELEX will include a modernized Command and Control System, Multi-Link, Identification Friend or Foe Mode S/5, upgrades to the radars, new Electronic Support Measures System, upgrades to the Internal Communications system, and an upgraded Harpoon Weapon System. These acquisitions will both sustain current capability and contribute to the new littoral operations role of the HALIFAX Class.

Project Phase: Implementation. Implementation of the HCM/FELEX project will occur through three principal contracts: two Multi-Ship Contracts (MSC) for docking work periods/refits and one Combat System Integration (CSI) contract to develop, procure and install the majority of the combat system elements of the project. Project completion is expected by January 2019.


Leading and Participating Departments and Agencies
Lead Department Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments and Agencies Industry Canada and its regional agencies


Prime and Major Sub-Contractors
In-Service Support Contractor (Class Design Agent) Fleetway Incorporated, Halifax, NS, Canada
Internal Communications System DRS Flight Safety, Kanata, ON, Canada
Multi-Ship Contract (East) Halifax Shipyard, Halifax, NS, Canada
Multi-Ship Contract (West) Victoria Shipyard, Victoria, BC, Canada
Combat System Integration Contract Lockheed Martin Canada, Montréal, QC, Canada
Harpoon/AHWCS Boeing


Major Milestones
Major Milestone Date
Preliminary Project Approval (PPA) Approval February 2005 (FELEX)
February 2007 (HCM/FELEX)
Refit Procurement Strategy Approval by TB March 2007
Revised Preliminary Project Approval (Part 1) June 2007
Multi-Ship Contracts (MSC) Awarded (Docking Work Periods & Refits) March 2008 (West)
March 2008 (East)
Effective Project Approval (EPA) Approval (Part 2) September 2008
Combat System Integration Contract Award November 2008
Refits Begin October 2010
Full Operational Capability January 2018
Project Closure January 2019

Progress Report and Explanation of Variances: In September 2008, Treasury Board granted Effective Project Approval and Expenditure Authority for the project. The total full-up project value, including GST, is $2,998M (BY).

Three qualified contractors were selected to receive Request For Proposals through a Solicitation of Interest Qualification process. During the RFP process, two of the potential bidders withdrew from the competition. The sole bid, from Lockheed Martin Canada (LMC), was compliant with all mandatory requirements and a risk assessment of its proposal indicated no unacceptable risks. The CSI contract was awarded to LMC in November 2008.

The HCM/FELEX Project is presently in its implementation phase and is currently within budget.

A Request for Proposal for the Multi-Ship Contracts (docking work periods and refits) resulted in two successful bidders, Halifax Shipyard on the east coast and Washington Marine Group (Victoria Shipyard) on the west coast. Contracts were awarded to the two shipyards in March 2008.

Industrial and Regional Benefits: Industrial and Regional Benefits (IRBs) for this project are equivalent to 100% of the contracted value.

INTELLIGENCE SURVEILLANCE, TARGET ACQUISITION
AND RECONNAISSANCE (ISTAR)

Description: ISTAR is an omnibus project that received Treasury Board approval for definition phase activity in April 2003. The purpose of this project is to develop, deliver and evolve an integrated, interoperable, ISTAR capability that will improve the ability of commanders to visualize the operational area, manage sensors and information collection resources, and to plan and implement actions to successfully complete operational missions. The project will provide enhancements to existing capabilities and include the acquisition of new capabilities in the areas of communications, command and control and sensors. The project includes the acquisition of Unmanned Aerial Vehicles (UAV), Weapon Locating Sensors (WLS) and transformation or enhancement of existing sensor platforms to include Electronic Warfare (EW), Light Armoured Vehicle III, Coyote Reconnaissance Vehicle, Ground Based Air Defence, Geomatic support and Tactical Meteorology Systems.

Project Phase: Implementation. Delays have been experienced in formally advancing the sub-projects to the Implementation Phase due to the impact of numerous Urgent Operational Requirements for Afghanistan that are related to and implemented by the LF ISTAR Project Management Office. In support of Urgent Operational Requirements for OPERATION ATHENA in the 2003/2004 timeframe, the project delivered equipment in the areas of Command and Control, Tactical Unmanned Aerial Vehicles, Weapons Locating Sensors and Electronic Warfare capabilities. These early deliveries enhanced professional knowledge and contributed to project definition work. Early delivery of elements of the Unmanned Aerial Vehicles, Electronic Warfare, and Data Link Communications sub-projects continued during 2006 with the Urgent Operational Requirements for OPERATION ARCHER. As well, urgently required systems in particular the HALO Acoustic Weapons Locating System, the Lightweight Counter Mortar Radar system, and additional Electronic Warfare systems were fielded in 2007. Responding to the need for persistent surveillance identified by the CF Counter IED Task Force and confirmed in the recommendation of The Independent Panel on Canada's Future Role in Afghanistan, the LF ISTAR Project Management Office delivered additional Small Unmanned Aerial Vehicle capability through a contracted service in 2008. In early 2008 the Electronic Warfare sub-project and the Command and Control sub-project were approved for implementation.


Leading and Participating Departments and Agencies
Lead Department Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments Industry Canada and its regional agencies


Prime and Major Sub-Contractors
Prime Contractor for the UAV UOR Op ATHENA sub-project Oerlikon Contraves Inc., Saint-Jean, QC
Major Sub-Contractor for the UAV UOR Op ATHENA sub-project SAGEM SA, France
Prime Contractor for Beyond Line of Sight Satellite (BLOS) UOR Op ARCHER ND Satcom, Germany
Prime Contractors for Mobile Electronic Warfare Team (MEWT) UOR Op ARCHER Agilent Technologies, Ottawa, ON
Digital Receiver Technology Inc, Maryland USA
Signal Technology Associates Inc., Kanata, ON
Xwave, Stittsville, Ontario
Prime Contractor for Mini UAV UOR Op ARCHER Thales Canada, Ottawa, ON
Major Sub-contractor for the Mini UAV UOR Op ARCHER Elbit Systems, Israel
Prime Contractor for Acoustic Weapon Locating System (AWLS) Op ARCHER SELEX Sensors & Airborne Systems Ltd, Basildon
Essex, United Kingdom
Type 1 Radios Data Link Communication (DLC) project - Foreign Military Sales (FMS) US Army, USA
Light Weight Counter Mortar Radars (LCMR) - Foreign Military Sales (FMS) US Army, USA
Small UAV Service Contract In Situ, Bingen, Washington USA


Major Milestones
Major Milestone Date
Treasury Board Preliminary Project Approval April 2003
MND Approval TUAV Unforecasted Operational Requirements (UOR) May 2003
Treasury Board Project Approval in Arrears UAV UOR
Full Operational Capability
Close-out		 May 2005
December 2005
June 2009
Communications & Data Link Component Treasury Board Effective
Project Approval
Initial Operational Capability		 December 2006
October 2009
Command and Control (C2) Treasury Board Effective Project Approval
Initial Operational Capability		 February 2008
October 2009
EW Sensors Treasury Board Effective Project Approval Phase 1
Amendment 1 (AL 1)
Initial Operational Capability
Full Operational Capability		 November 2005
February 2008
March 2008
January 2013
In Service Sensors Enhancement Treasury Board Effective Project Approval March 2010
Medium Range Radar Treasury Board Effective Project Approval June 2010
WLS Acoustic Sensor
Initial Operation Capability (IOC)
Full Operational Capability		 November 2005
March 2008
November 2009
Family of Mini UAV Treasury Board Effective Project Approval (UOR)
Family of Mini UAV Treasury Board Effective Project Approval AL 1		 November 2005
September 2010
Light Weight Counter Mortar Radar Effective Project Approval
Initial Operation Capability (IOC)
Full Operational Capability (FOC)		 March 2007
March 2008,
July 2010
Deliveries Complete all ISTAR sub-projects September 2013
Project Completion March 2014

Progress Report and Explanations of Variances: Prosecuting the Urgent Operational Requirements continues to challenge the omnibus project delivery; however, current estimates are that the project will be complete in 2013 as per the schedule contained in the LF ISTAR Omnibus revised Preliminary Project Approval submission approved by Treasury Board in December 2006. National Procurement funding requirements are being identified in the Effective Project Approval documentation for each of the ten sub-projects. Effective Project Approvals have been received for all but three of the LF ISTAR sub-projects.

Delivery of equipment actually started with UORs in Op ATHENA, and final deliveries are scheduled out to 2013. The currently approved sub-projects in support of Op ATHENA and Op ARCHER are:

  • UAV UOR Op ATHENA
  • BLOS Op ARCHER
  • MEWT Op ARCHER
  • Mini UAV UOR Op ARCHER
  • AWLS Op ARCHER
  • LCMR Op ATHENA
  • Remote Viewing Terminal Op ATHENA

In addition the Data Link Communications project received TB approval in December 2006 and PWGSC received TB contract approval for radios in February 2007. The FMS cases for 1,300 radios have been accepted, initial delivery of equipment started in August 2008 and final delivery is expected June 2009. In February 2008, TB approved the ISTAR Electronic Warfare and Command and Control sub-projects. Implementation has now started. For the Command and Control sub-project action is being taken to effect an early delivery of an All Source Intelligence Center for support to the Vancouver Olympic and Paralympics Games; and of the G8 Summit.

The TUAV project was closed in June 2009 and the AWLS sub-project is scheduled to close in Nov 2009.

The LCMR FOC is tied to a US Army upgrade program. These activities are delayed due to US delays in contracting for the final retrofit of all US, UK and Canadian LCMR to fully meet the specification. There is no technical risk as the final implementation is already used for new system delivery to the US it is purely contracting process delay on the US side. The retrofit is required as we all took delivery of a late LRIP model to meet UOR schedule knowing we would have a retrofit program to meet FOC. This retrofit was planned to reduce fleet maintenance cost by having a single fleet to R&O instead of the current 4 fleets.

Industrial Benefits: Canadian industry benefit from the ISTAR project continues to be determined during the approval of the procurement strategy for each sub-projects. Canadian Industry has derived long term benefit from many aspects of the ISTAR project.

JOINT SUPPORT SHIP (JSS)

Description: The JSS will maintain the Canadian Navy's current naval task group logistic support, while ensuring that the Canadian Forces has an adequate, assured strategic sealift capability to allow it to deploy and sustain operations in support of government policy. It will also enhance Canada's capability for joint command and control of forces ashore. The ships will replace the two ageing Protecteur class support ships currently in service on the east and west coast.

Project Phase: Definition/Implementation


Leading and Participating Departments and Agencies
Lead Department Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments Industry Canada and its regional agencies

Prime and Major Sub-Contractors: No prime contractor has been selected. Final selection of the prime contractor will occur at Effective Project Approval.


Major Milestones
Major Milestone Date
Treasury Board Preliminary Project Approval - (PPA) November 2004
Invitation for Bids Posted on MERX June 2006
Project Definition - Contract Award December 2006
Preliminary Options Analysis Ongoing

Progress Report and Explanations of Variances: In August 2008, the Minister of Public Works and Government Services Canada (PWGSC) announced the termination of the initial procurement process to acquire three Joint Support Ships.

After receiving and evaluating the mandatory requirements for the Joint Support Ship Project from the bidders, the Crown has determined that both proposals were not compliant with the basic terms of the Request for Proposals (RFP). Among other non-compliances, both bids were significantly over the established budget provisions of $1,575B for the Project Implementation (PI) Contract for the delivery of the JSS capability (3 ships).

During the August 08 to March 09 timeframe, the Project Office conducted Options Analysis that examined cost versus capability of various options. Work continues on a recommended course of action for the JSS project with the aim of achieving a departmental decision as soon as possible.

Industrial and Regional Benefits: Industrial and Regional Benefits (IRBs) for this project are equivalent to 100% of the contracted value for both the capital acquisition and in-service support.

LIGHT UTILITY VEHICLE WHEELED (LUVW)

Description: Light utility vehicles are highly mobile and essential to facilitating the tactical command of combat, combat support and combat service support units, to assist in the gathering and dissemination of information and to liaise within and between field formations.

The LUVW Project mandate is to replace Canadian Iltis vehicles with two separate vehicle acquisitions: 1,159 Standard Military Pattern (SMP) vehicles (Mercedes Benz G Wagon) with integrated logistic support and 170 Armour Protection Systems ($241.4M), for use by field force units; and 1,061 Militarized Commercial Off-The-Shelf (Mil COTS) vehicles (GM Silverado) ($65.4M) for use primarily by the Reserve Force for a total project cost of $306.8M.

Project Phase: Implementation


Leading and Participating Departments and Agencies
Lead Department Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Department Industry Canada and its regional agencies


Prime and Major Sub-Contractors
Prime Contractor (Phase 1) SMP Mercedes-Benz Canada (MBC), Toronto, ON
Prime Contractor (Phase 2) Mil-COTS General Motors Defense Military Trucks, Troy, Michigan, USA


Major Milestones
Major Milestone (Phase 1) SMP Date
Award of Contract October 2003
First Full Production Delivery February 2004
Final Production Delivery November 2006
Effective Project Completion November 2009


Major Milestone (Phase 2) Mil COTS  
Award of Contract October 2002
First Full Production Delivery October 2003
Final Production Delivery December 2004
Effective Project Completion December 2009

Progress Report and Explanation of Variances: The project is in full Implementation. Outstanding issues are Amendment 2 to the SMP production contract and delivery of the Mil COTS battery disconnect switch kits. The amendment to the SMP production contract is required to reflect the costs resulting from Design Change Requests (DCRs), as well as additional ILS publication requirements. A contract valued at $1.71M (incl GST) was awarded to Kerr Industries in July 2008 for the delivery of 1,061 battery disconnect switch kits. These kits are required to isolate the electrical system and associated parasitic loads from draining the batteries when the vehicles are not in use. Final delivery is scheduled for March 2009, but it is anticipated that Canadian Forces (CF) Reserve units will not have the last of these kits installed by their local GMC dealership until December 2009.

For the SMP production contract, a total of $19.6M has been applied as holdbacks, which equate to 10% of all paid invoices. It is anticipated that the amendment will be completed and signed by October 2009, at which time these funds can be released.

An Initial Support Contract (ISC) (valued at $17.9M incl GST) was awarded to MBC in November 2005 to provide spares, R&O, lease of diagnostic equipment, support and engineering services, and 4th line vehicle repair, with the last (3rd) year option exercised in October 2007. This contract was amended (value increased by $0.77M) and extended to June 2009 at which time a new "bridging" ISC contract was awarded to MBC in June 2009 (valued at $9.3M incl GST) to allow continued support of the LUVW SMP fleet until the Long Term Support Contract (LTSC) (estimated value of $99M incl GST over 15 years) can be awarded.

A contract valued at $1.87M (incl GST) for Special Tools and Test Equipment (STTE) was awarded to MBC in November 2008. Delivery for STTE will commence in July 2009 to both depots with delivery to the base maintenance facilities completed by September 2009 at which time FOC will be declared. Once FOC has been declared, the project will begin the close-out process with project closure scheduled for December 2009 to coincide with the final installation of the Mil COTS battery disconnect switch kits.

Even with the above mentioned changes, the project is scheduled to close under the allocated funding of $298.4M. The vehicle fleet has been affected by body cracks and inferior weapons station design and quality issues. On the subject of vehicle body cracks, an agreement was arrived at to address vehicles with body cracks and those potentially at risk of developing future cracks. MBC has initiated a redesign of the weapons station to address these deficiencies, with the first two prototypes completed in January 2009.

Industrial Benefits: The industrial benefits are required for Phase 1 for a value 100% of the contract value. Latest report from Industry Canada indicates that Mercedes Benz Canada has exceeded the industrial regional benefit goals by $300M. There are no mandated industrial benefits for the Mil COTS contract. Industry Canada is working with MBC to identify regional components of the Industrial and Regional Benefits (IRBs) program under the Initial Support Contract (ISC). There will be an IRB requirement in the LTSC in the amount of 100% of the contract value.

MAIN BATTLE TANK (MBT)

Description: The purpose of the Tank Replacement Project is to replace Canada's aging Leopard C2 tank fleet with a modern, heavily protected, mobile, direct fire support capability. The Tank Replacement Project is divided into two phases. Phase 1 consisted of the loan of 20 Leopard 2 A6M Main Battle Tanks (MBT), two Armoured Recovery Vehicles (ARV) and logistics support from the German Government for immediate deployment to Afghanistan, as well as the purchase of 100 surplus Leopard 2 MBT from the Netherlands Government. Phase 2 consists of the repair, overhaul, upgrade and introduction of up to 100 Leopard 2 tanks and armoured recovery vehicles into service with the CF.

Project Phase: Implementation. The project received Treasury Board (TB) approval for Phase 1 in March 2007 and expects to receive Effective Project Approval (EPA) for Phase 2 by June 2009. Project constraints include a budget cap of $650M and the requirement for work to be done in Canada.


Leading and Participating Departments and Agencies
Lead Department or Agency Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments and Agencies Industry Canada and its regional agencies


Prime and Major Sub-Contractors
Prime Contractor for ARV upgrades Phase 1 Rheinmetall Landsysteme (RLS), Germany
Prime Contractor for MBT upgrades
Phase 1		 Krauss-Maffei Wegmann (KMW), Germany
Prime Contractor for loaned tanks German Government
Prime Contractor for tank purchase Netherlands Government
Logistic Support Arrangement German Government
Contracts to support operations Various
Phase 2 Contracts for:
  • 20 operational tanks (repair, overhaul and upgrades)
  • 42 Training tanks (repair, overhaul and limited upgrades)
  • 8 ARVs (conversion and upgrades)
  • ILS (parts, ammunition, training and simulation, tools and test equipment, publications)
 Krauss-Maffei Wegmann (KMW), Germany

(other contracts estimated for late 2009 or early 2010)


Major Milestone Date
Treasury Board - Preliminary Project Approval (PPA) March 2007
Phase 1 - Loan Agreement with German MoD May 2007
Phase 1 - Contract to KMW for upgrades to Loaned tanks May 2007
Phase 1 - Contract to RLS for upgrades to Loaned tanks May 2007
Initial Operational Capability - (Phase 1) August 2007
Phase 1 - Acquisition of tanks from Dutch Government December 2007
Letter of Interest April 2008
PPA Amendment approved by TB June 2008
Price and Availability May 2009
Treasury Board - Effective Project Approval (EPA) June 2009
Phase 2 - Contract to KMW for urgent requirement 20 x Leopard 2 A4 (Ops) tanks June 2009
Full Operational Capability - (Phase 2) December 2012
Project Closed-Out December 2014

Progress Report and Explanations of Variances: The imperative to upgrade and deploy the borrowed tanks into Afghanistan to meet the July 2007 Initial Operational Capability (IOC) date required some performance trade-offs. Time was insufficient to develop, qualify, and implement a new passive armour solution and as a result, the 20 borrowed tanks deployed with new slat armour. Time was also insufficient to install air conditioning therefore a crew cooling vest solution was developed and implemented. Some Leopard 1 C2 tanks for use with implements remain in theatre as the Leopard 2 tanks are not designed to accept implements.

The work in support of the Effective Project Approval submission was a priority activity and TB approval for Phase 2 was received in June 2009. The feasibility study with Industry was cancelled by PWGSC, and a reduced technical study was completed by DND using in-house resources and liaison with Allied nations. The Leopard 2 tank capabilities and the Canadian performance requirements have been identified. The Letter of Interest announced the broad objectives of the Project and the Industry responses confirmed a competitive environment. The Price and Availability identified the core deliverables and obtained price and schedule information from Industry. The Effective Project Approval submission to Treasury Board included some indicative costs due to the nature of repair and overhaul activity.

Industrial and Regional Benefits (IRB): No IRBs were required for Phase 1. The IRB requirements for Phase 2 are 100 %, as recommended by Industry Canada.

MARITIME HELICOPTER PROJECT (MHP)

Description: The purpose of this project is to replace the CH124 Sea King with a fleet of 28 new fully equipped Maritime Helicopters bundled with a long-term In-Service Support contract and the modification of the HALIFAX class ships to accommodate the new Maritime Helicopters. This replacement will address the operational deficiencies of the current CH124, eliminate the supportability difficulties of the older helicopter, and provide a sufficient fleet size of multi-purpose shipborne Maritime Helicopters for operations well into the 21st century.

Project Phase: Implementation. In November 2008, the project marked the four-year milestone in the Implementation Phase. The project focus is now shifting from design and engineering to aircraft manufacturing and assembly followed by flight tests and delivery of the aircrafts.


Leading and Participating Departments and Agencies
Lead Department or Agency Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments and Agencies Industry Canada and its regional agencies


Prime and Major Sub-Contractors
Prime Contractor Sikorsky International Operations Incorporated,
Stratford, Connecticut, USA
Sub-Contractors General Dynamics Canada, Ottawa, Ontario
L-3 MAS Canada, Mirabel, Québec


Major Milestones
Major Milestone Date
Preliminary Project Approval (PPA) June 2003
Invitations for Bids Posted on MERX December 2003
Synopsis Sheet (Effective Project Approval) SS (EPA) November 2004
Contract Award November 2004
First Delivery November 2010
Final Delivery 2013
Project Close-out 2014

Progress Report and Explanations of Variances: In December 2008, following discussions to minimize delays in the planned delivery of the integrated Maritime Helicopter, the Government and Sikorsky agreed to a new schedule for the delivery of helicopters starting in November 2010, with delivery of enhanced helicopters commencing in July 2012.

Other components of the project such as construction of the Training Centre building in Shearwater, NS, and ship modification work on HMCS Montréal have progressed well and are on schedule. The first test flight of the Maritime Helicopter occurred on November 15, 2008. The project is currently running within its authorized budget.

Industrial Benefits: The Industrial Regional Benefits are equivalent to 100% of the contract value for the capital acquisition and more than 80% of the contract value for the In-Service Support.


Region Capital Acquisition In-Service Support
Atlantic Canada $239.1M $825.9M
Québec $555.8M $399.2M
Northern Ontario $3.2M $7.6M
Ontario (excluding Northern Ontario) $924.3M $1,073.2M
Western Canada $210.6M $181.4M
Unallocated $10.0M $105.7M
Total $1,943.0M $2,593.0M

MATERIAL ACQUISITION AND SUPPORT INFORMATION SYSTEM (MASIS)

Description: The mission of the Material Acquisition and Support Information System (MASIS) project is to provide a Department of National Defence (DND) integrated materiel acquisition and support information system that enables the cost-effective optimization of weapon/equipment system availability throughout the life cycle. The scope of MASIS includes all end-to-end information requirements within DND/CF related to the materiel acquisition and support functions which are comprised of systems engineering, integrated logistics support (ILS), equipment configuration, technical data management, asset management, maintenance management, project management, performance management, operational support, business management, decision support analysis and contract management.

Project Phase: Implementation. To date the project has completed Phases 1 to 4 and implementation of Phase 5 is currently underway. Project completion is expected for 2012.


Leading and Participating Departments and Agencies
Lead Department or Agency National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments and Agencies N/A


Prime and Major Sub-Contractors
Prime Contractor IBM Canada, Ottawa, Ontario
Major Sub-Contractors SAP Canada, Ottawa, Ontario
Pennant Ottawa, Ontario, Canada


Major Milestones
Major Milestone Date
Definition Phase  
Preliminary Project Approval - Expenditure Authority for Phase 1 June 1998
Contract Awarded for Prime Systems Integrator December 1998
MASIS system - Go Live Phase 1 (202 Work Depot Montréal) September 1999
Implementation Phase  
Expenditure Authority (EPA) for Phases 2 and 3:
  • Implementation of Complex Contracts;
  • Implementation of the MASIS solution to the Navy;
  • Operations Support & Maintenance for MASIS;
  • Planning and scoping for requirements scheduled to be implemented for the Army.
 June 2000
Amended Expenditure Authority (EPA) for Phase 4:
  • Investigation of opportunities to progress the implementation of MASIS to the maximum extent possible within the future available Phase 5 funding;
  • Management of Operations Support & Maintenance for MASIS (outside MASIS project Expenditure Authority);
  • Project was deemed as a Major Crown Project with this approval.
 December 2003
Amended Expenditure Authority (EPA) for Phase 5 to cover rollout of additional functionality to wider user base including Air Force and Army. June 2007
Project Close-out 2012

Progress Report and Explanations of Variances: Following Definition Phase approval, EPA for MASIS was granted to DND in June 2000 in the amount of $147.8M. This authority provided the project the means to cover the work under Phases 1 to 3, which have been completed.

The project follows a cyclical approval and delivery methodology. In December 2003, an additional $34.4M was approved to fund Phase 4 of the project, which has been completed. In June 2007, the MASIS project received Treasury Board approval in the amount of $170M for Phase 5. Phase 5 activities include the rollout of MASIS functionality to Army and Air Force. To date, Phase 5 activities are on budget and on time. Planned completion of project is within the 2012 timeframe.

Industrial Benefits: All industrial benefits are attributed to Ontario since all project expenditures occur in Ontario.

MEDIUM TO HEAVY LIFT HELICOPTER (MHLH)

Description: Over the last decade, the ability to move personnel and equipment by air has become a vital and growing capability requirement for the Canadian Forces in fulfilling a wide range of roles. Canadian Forces operational experience, particularly in current operational theatres, has highlighted the urgent need for medium to heavy lift helicopters to support land forces in a threat environment by quickly, efficiently and safely moving large numbers of personnel and heavy equipment from forward deployed bases, thus reducing their vulnerability to attack. Both at home and overseas, medium to heavy lift helicopters will provide the Government with a wider range of military options for addressing threats and emergencies beyond the Canadian Forces' current helicopter fleets.

The Medium to Heavy Lift Helicopter project will deliver the medium to heavy lift helicopter capability to support land-based domestic and international operations and to support Army Training on the road to high readiness. The project will acquire a minimum of 16 helicopters, integrated logistic support and other related support elements.

Project Phase: Definition


Leading and Participating Departments and Agencies
Lead Department or Agency Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments and Agencies Industry Canada and its regional agencies


Prime and Major Sub-Contractors
Prime Contractor The Boeing Company, Philadelphia, Pennsylvania, USA


Major Milestones
Major Milestone Date
Synopsis Sheet Preliminary Project Approval (PPA) June 2006
Advanced Contract Award Notice Posted on MERX July 2006
Effective Project Approval and Contract Award June 2009
First ACAN Compliant Aircraft June 2012
First MHLH June 2013
Initial Operational Capability (IOC) June 2014
Full Operational Capability (FOC) June 2015
Project Close-out June 2016

Progress Report and Explanation of Variances: With technical support from the Project Management Office, PWGSC commenced negotiations based on Boeing's proposal that was delivered in July 2008. Challenges in areas such as scope of work/cost reconciliation, Terms and Conditions, Industrial and Regional Benefits and In-Service Support competition plan have extended contract negotiations. Best efforts will be undertaken to obtain Treasury Board Approval to achieve contract award in June 2009.

Industrial Benefits: This procurement will provide Industrial Regional Benefits equivalent to 100% of the contracted value for both the capital acquisition and integrated in-service support. The Boeing Company is required to identify, as specific work packages, 60% of the total acquisition commitment prior to contract signing. For the integrated in-service support portion, 75% of the contract value will be direct work performed by a Canadian company. These industrial and regional benefits requirements will be negotiated and accepted by Industry Canada prior to contract signing.

MEDIUM SUPPORT VEHICLE SYSTEM PROJECT (MSVS)

Description: The Medium Support Vehicle System Project is a capability replacement project for the existing Medium Logistics Vehicle Wheeled (MLVW) fleet that has reached the end of its service life due to age, heavy usage and corrosion. The MSVS project will cost approximately $1.2 B (net of GST) and will deliver the following mix of vehicles:

  • medium-sized Standard Military Pattern (SMP) vehicles:
    • Up to 1,500 vehicles, with options for an additional 650;
    • Up to 150 integrated armour protection systems, with options for an additional 150, and
    • Up to 300 companion military pattern trailers, with options for an additional 240.
  • medium-sized Militarized Commercial Off-the-Shelf (MilCOTS) vehicles:
    • 1,300 commercial vehicles with militarized components, with options for an additional 500.
  • Special Equipment Vehicle (SEV) Kits:
    • Up to 1,000 special equipment vehicle kits, with options for an additional 150.

Project Phase: Definition SMP and SEV Kits, Implementation MilCOTS


Leading and Participating Departments and Agencies
Lead Department or Agency Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments and Agencies Industry Canada and its regional agencies

Prime and Major Sub-Contractors: One prime contractor will be selected for each project component. Final selection of the prime contractors will occur through Revised Preliminary Project Approvals (Rev (PPAs)) for MilCOTS Vehicles, SEV Baseline Shelters and SMP Vehicles followed by Effective Project Approval (EPA) for SEV Kits.


Prime Contractor - MILCOTS Navistar Defence LLC, Warrenville, Illinois, USA


Major Milestones
Major Milestone Date
Preliminary Project Approval (PPA) June 2006
Invitation for Bids Posted on MERX - MilCOTS Vehicles November 2007
Invitation for Bids Posted on MERX - SMP Vehicles Fall 2009
Invitation for Bids Posted on MERX - SEV Baseline Shelters May 2008
Invitation for Bids Posted on MERX - SEV Kits Early 2010
Rev PPA for MilCOTS Vehicles December 2008
Rev PPA for SMP Vehicles Fall 2010
Rev PPA for SEV Baseline Shelters Spring 2009
EPA for SEV Kits Early 2011
Contract Award - MilCOTS Vehicles January 2009
Contract Award - SMP Vehicles Fall 2010
Contract Award - SEV Baseline Shelters Summer 2009
Contract Award - SEV Kits Early 2011
First Delivery - MilCOTS Vehicles Spring 2009
First Delivery - SMP Vehicles Fall 2011
First Delivery - SEV Baseline Shelters Early 2011
First Delivery - SEV Kits Spring 2011
Delivery Complete - MilCOTS Vehicles Fall 2010
Delivery Complete - SMP Vehicles Summer 2013
Delivery Complete - SEV Baseline Shelters Fall 2012
Delivery Complete - SEV Kits Fall 2012
Project Close Out Fall 2013

Progress Report and Explanations of Variances: In December 2008, PMO MSVS obtained Treasury Board expenditure authority for MilCOTS in the amount of $351.8M ($BY), plus GST and a Rev PPA for an indicative full-up cost estimate of $1.22B ($BY), plus GST for all components of the MSVS project.

  • MilCOTS - Agreement in Principle was reached in August 2008 with the single responsive bidder. Rev PPA and contract approval was received in December 2008. Contract was awarded in January 2009.
  • SEV Baseline Shelter - The SEV Baseline Shelter RFP was released to industry in May 2008 and the bid evaluation was completed in July 2008. Negotiations with the single responsive bidder are planned for completion in early 2009. Rev PPA planned for spring 2009 and contract award for this component is planned for Summer 2009.
  • SMP - A revised draft technical specification was posted in November 2008 for industry comment. The complete RFP is planned for release in fall 2009.
  • SEV Kits - The SEV Kits RFP is scheduled for release in early 2010.

Schedule delays have occurred and are attributed to delayed project approval and overall staffing shortages. Cost variances have also occurred and are attributed to the receipt of single bids for MilCOTS vehicles and SEV Baseline Shelters with higher than anticipated price proposals, volatile raw material market and fluctuation in foreign exchange rates.

At this time, Project Close-out is anticipated for Fall 2013. A continuous risk management program has been implemented and costing efforts for the implementation phase are progressing.

Industrial & Regional Benefits: Industrial Regional Benefits (IRBs) equivalent to 100% of the contract value will be required for each project component.

MILITARY AUTOMATED AIR TRAFFIC SYSTEM (MAATS) PROJECT

Description: A national air traffic system project to automate air traffic services has been initiated by Transport Canada (now NAV CANADA). To ensure that military air operations continue to function effectively, remain compatible with the national system, and keep pace with these enhancements, the Department of National Defence and the Canadian Forces established the Military Automated Air Traffic System (MAATS) Project. The project directly supports the defence objective of conducting air traffic control operations.

The MAATS project will provide the essential equipment and system interfaces necessary to automate data interchange between applications. The project will deliver a stable, sustainable, and operational Air Traffic Management System (ATMS) while providing as much integration as possible with NAV Canada's Canadian Automated Air Traffic System (CAATS). Where equipment or system interfaces are not currently available, new equipment will be installed. All existing Defence radar systems will be retained and interfaced to the MAATS as appropriate.

Project Phase: Implementation


Leading and Participating Departments and Agencies
Lead Department Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Departments Industry Canada and its regional agencies


Prime and Major Sub-Contractors
Prime Contractor Raytheon Canada Limited, Richmond, BC
NavCanada, Ottawa, ON
Major Sub-Contractors Hewlett Packard Canada Ltd, Ottawa ON
CVDS, Montréal PQ
Frequentis Canada Ltd, Ottawa ON


Major Milestones
Major Milestone Date
Treasury Board Effective Project Approval July 1993
Contract Award January 1994
Preliminary Design Review September 1997
May 2000
Critical Design Review February 2001
Factory Acceptance Test (Closure) January 2002
Initial Delivery (Montréal) December 2003
Contract Complete (Last Payment) December 2004
Approval received to disengage concurrent development with NAV CANADA project and pursue sustainable minimum military requirement September 2006
Begin Software Development on Phoenix Systems October 2006
Complete Phoenix NAMS II Development October 2007
Initial Operational Capability - First Wing Operational with NAMS II Equipment October 2007
Full Operational Capability (FOC) - All Wings with delivered Equipment June 2009
Begin project Close-out July 2009
Project complete April 2010

Progress Report and Explanation of Variances: Treasury Board initially approved the project with an estimated cost of $179.2M. The project funding was reduced by $15M following departmental review. Partial return of funding was approved at the December 2003 Senior Review Board (SRB). Current departmental funding is $169.2M.

As briefed at SRB in June 2006, the MAATS project objectives were declared unachievable within the existing funding envelope. Given a number of alternative options, the MAATS' Project Management Office (PMO) recommended to cease MAATS development, and continue the project with the implementation of an "in-house" solution coined Phoenix. With the support of the Chief of the Air Staff and ADM(Mat), the Project Management Board (PMB) concurred with the PMO's recommendation in March 2007. MAATS' PMO was directed to de-link the project from NAV Canada's Civilian Automated Air Traffic System (CAATS); concentrate on the re-vitalization and integration of Air Traffic Controller (ATC) information sources at each of the seven wings (Comox, Cold Lake, Moose Jaw, Bagotville, Trenton, Greenwood and Goose Bay); keep military Instrument Flight Rules (IFR) operations at the Wings vice at two Military Terminal Control Centres; and pursue the development and fielding of the Phoenix solution.

Since the approvals were received in July 2007, the Phoenix solution is well on its way upgrading the current Air Traffic Management System capability inclusive of the following sub-systems: the Radar Processor, the Navigational Aids and Meteorological Sub-System (NAMS), the Air Movement Statistics Package and the Flight Data System. Phoenix is based on the proven Radar Processing Display System II (RPDS II), which was certified for Operational Airworthiness and built on standard commercial off-the shelf (COTS) hardware and open source software, thus keeping technical risk LOW. Installation of Phoenix equipment (NAMS II) at 8 Wing Trenton was completed and Provisional Operational Airworthiness Clearance (POAC) was granted in October 2007, ahead of schedule. Actual close out activities, including a project completion report to Treasury Board, will be completed in fiscal year 2009-10.

PMO implemented the last site (Goose Bay) in May 2009 with NAMS II, Frequentis integration voice comms switch and Control Tower Consoles Revitalization. All sites are now synchronized with same technology and interfaces. The Vancouver 2010 Olympics shifted ATESS personnel priorities which has delayed the delivery of some REDDS capabilities development. Currently, Flight Data Entry Terminal (FDET II) which will address flight data processing is the last capability being developed under the project scope with its fielding to occur as a matrix task completed by the LCMM. PMO plans to close the MAATS Project on schedule with the full LCMM in-service support of REDDS in 2009 as its remaining objective.

Industrial Benefits: Canadian industry in the following regions of Canada will benefit from the MAATS project.


Region Cash Benefits
Atlantic Canada 1.6M
Québec 1.0M
Ontario 1.8M
Western Canada 45.8M
Unallocated To be determined
Total $50.2M

PROTECTED MILITARY SATELLITE COMMUNICATIONS (PMSC)

Description: The Department of National Defence and the Canadian Forces require global communications that are secure, guaranteed and directly interoperable with our allies. The aim of the Protected Military Satellite Communications Project (PMSC) is to overcome current Canadian Forces interoperability and global command and control limitations. Upon completion, this project will enable long-range communications to deployed forces and facilitate their interoperability with allies.

Project Phase: Implementation. The PMSC project is being implemented in two phases with project completion expected for Winter 2017.


Leading and Participating Departments and Agencies
Lead Department Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Department Industry Canada and its regional agencies


Prime and Major Sub-Contractors
Prime Contractor United States Department of Defense
Major Sub-Contractors To be determined


Major Milestones
Major Milestone Date
Preliminary Project Approval August 1999
Effective Project Approval November 2003
Initial Terminal Delivery Summer 2011
Initial Satellite Delivery Summer 2012
Terminal Delivery Completed Summer 2013
Project Complete Winter 2017

Progress Report and Explanations of Variances: The PMSC project is being implemented in two phases. In Phase 1, the satellites are being procured under the terms of a Memorandum of Understanding (MOU) with the United States Department of Defense (DOD) that guarantees Canadian participation in their Advanced Extremely High Frequency (AEHF) system. Definition studies for the terminal segment were completed in Phase 1. Under Phase 2, the terminal segment is being procured and will be installed and tested starting in 2011.

In August 1999, Treasury Board granted Preliminary Project Approval to the PMSC Project, with expenditure authority for the implementation of Phase 1 at an estimated cost of $252M and granted approval for the Department of National Defence to enter into a Military Satellite Communication (MILSATCOM) MOU with the US Department of Defense. The MOU was signed in November 1999.

In November 2003, Treasury Board granted Effective Project Approval to the PMSC Project, with expenditure authority for the Implementation of Phase 2 at an estimated cost of $300M. The total cost is now estimated at $552M. The project is on budget.

Industrial Benefits: Under Phase 1, the US Department of Defense has committed to a work share with Canadian industry proportional to our contribution. Suppliers from both nations will be permitted to bid on project work. In Phase 2, the Senior Procurement Advisory Committee (SPAC) endorsed that Terminal acquisition and support will be procured through Foreign Military Sales with installation done through DND managed contracts. Industrial and regional benefits will be sought by Industry Canada at 100% of contract value.

SUBMARINE CAPABILITY LIFE EXTENSION (SCLE)

Description: The Submarine Capability Life Extension (SCLE) project replaced the Oberon class submarine fleet with four existing British Upholder class (renamed Canadian Victoria class) submarines. The project will ensure that Canada preserves its submarine capability within the existing capital budget. The project supports Canada's ability to conduct surveillance and control of its territory, airspace and maritime areas of jurisdiction, as well as Canada's ability to participate in bilateral and multilateral operations.

Project Phase: Implementation. The project has delivered four functional Victoria class submarines with up-to-date, safe-to-dive certificates, four crew trainers (including a combat systems trainer, a ship control trainer, a machinery control trainer, and a torpedo handling and discharge trainer), and four trained crews. Canadianization of three platforms and twelve of seventeen associated projects have been completed. The last platform (HMCS CHICOUTIMI) will complete Canadianization during her Extended Docking Work Period (EDWP) which is scheduled to commence in January 2010 and the remaining five associated projects will be completed by project closure in March 2013.


Leading and Participating Departments and Agencies
Lead Department Department of National Defence
Contracting Authority Public Works and Government Services Canada
Participating Department Industry Canada and its regional agencies


Prime and Major Sub-Contractors
Prime Contractor The Government of the United Kingdom (UK) of Great Britain and Northern Ireland, Ministry of Defence, UK
Major Sub-Contractor British Aerospace Engineering (BAE) Marine Systems (formerly Vickers Shipbuilding and Engineering Limited
(VSEL)/Marconi Marine) Cumbria, UK


Major Milestones
Major Milestone Date
Treasury Board Approval June 1998
Main Contract Award July 1998
Initial Support Contract Award July 1998
Initial Operational Capability April 2006
Full Operational Capability December 2010
Project Close-out March 2013

Progress Report and Explanation of Variances: Effective Project approval was granted to the SCLE project in June 1998 at an estimated total cost of $812.0M (BY) net of GST. The expenditure ceiling was increased by $84.8M by Treasury Board in June 2003 to accommodate increased scope to include 17 submarine related projects and initiatives that were progressing outside the bounds of SCLE. SCLE project is currently expending to budget.

Canada has accepted all four Upholder submarines from the United Kingdom. The operational status of each of these vessels is summarized below:

  • Her Majesty's Canadian Ship (HMCS) Victoria is currently undergoing an Extended Docking Work Period (EDWP) at Fleet Maintenance Facility (FMF) Cape Breton. She is scheduled to undock in November 2009 and complete this activity in May 2010.
  • HMCS Windsor is currently undergoing an Extended Docking Work Period (EDWP) at Fleet Maintenance Facility (FMF) Cape Scott. She is scheduled to undock in late 2010 and complete this activity in 2011.
  • HMCS Corner Brook is operational and is participating in various exercises and patrols. Barring a six-month docking period commencing September 2009, she will remain operational until mid 2011.
  • HMCS Chicoutimi was handed over to Canada in October 2004 and while en-route to Canada, she had an electrical incident at sea that resulted in a fire and was returned to Canada via sealift. Although some of the repairs have been completed, a decision was taken to delay the completion of the repair and Canadianization until her EDWP. HMCS Chicoutimi was signed over to the Canadian Submarine Management Group (In Service Support Contractor) in June 2009. Her EDWP is scheduled to commence January 2010.

Based on progress to date and current information, all performance objectives of this contract will be met within the allocated budget.

Industrial and Regional Benefits: This project will provide an estimated $200M in direct and indirect industrial benefits. This includes Canadian modifications to the submarines and the relocation of the simulators and trainers to Canada. A further $100M in industrial benefits has taken the form of waivers to provide industrial offsets in the United Kingdom for Canadian companies bidding on defence contracts.



Summary of Transfer Payment Programs by Program Activity


($ thousands)   Actual  
2006-07		   Actual  
2007-08		 2008-09
Planned
Spending		 Total
Authorities		   Actual 
Spending
Grants          
Generate and Sustain Relevant, Responsive and Effective Combat-Capable Integrated Forces 130 124 132 132 123
Conduct Operations - - - - -
Contribute to Canadian Government, Society and International Community in Accordance with Canadian Interests and Values 5,171 5,213 5,360 5,360 5,208
Total Grants 5,301 5,337 5,492 5,492 5,331
CONTRIBUTIONS          
Generate and Sustain Relevant, Responsive and Effective Combat-Capable Integrated Forces 11,110 10,449 31,789 11,104 11,098
Conduct Operations - - - - -
Contribute to Canadian Government, Society and International Community in Accordance with Canadian Interests and Values 179,308 160,485 163,486 183,939 182,106
Total Contributions 190,418 170,934 195,275 195,043 193,204
Total Transfer Payments 195,719 176,271 200,767 200,534 198,535

Source: Assistant Deputy Minister (Finance and Corporate Services) Group
* Due to rounding, figures may not add up to totals shown.


Sustainable Development Strategies

The following table reports on progress made by National Defence towards the commitments made in the fourth iteration of the Defence Sustainable Development Strategy. A certain number of these commitments also support the federal Greening Government Operations agenda. These departmental commitments are coordinated by the Office of Greening Government Operations (OGGO) at Public Works and Government Services Canada (PWGSC), which includes work toward common governance, measurement, and reporting methods across departments.


National Defence
Points to Address Departmental Input
1. SDS Departmental Goal: The four overarching Strategic Commitments aim to:
  • move toward a framework of land use management designed to encourage innovative approaches to the stewardship of those lands with the ultimate goal of putting the lands with which Defence is entrusted on a "steady state" footing of sustainability;
  • actively promote the application of innovative sustainable infrastructure principles and concepts and share "lessons learned" with the broader federal community;
  • implement a proactive and comprehensive "Green Procurement" programme across Defence, meeting the recently promulgated Federal Government Policy on Green Procurement; and
  • actively and innovatively prevent negative environmental impacts of specific activities over which Defence can exercise a mitigating influence.

Defence SDS 2006 looks further out than the three-year cycle of the strategy itself. The Strategic Commitment on sustainable military training areas, for instance, spans the period 2003 to 2010 continuing its support of resource conservation, sound environmental stewardship and good governance. Defence is the government's largest employer and consumer of goods and services and is one of the largest landholders. As such, the Department acts in compliance with the Government of Canada's administrative and governance policies, legislation and regulations, and contributes to broader government priorities through responsible stewardship of the assets with which it has been entrusted.
2. Federal SD Goals including GGO goals: In addition to the traditional Strategic Commitments contained in the Defence strategy, SDS 2006 also contains four Monitoring Commitments (commitments to report on government priorities, such as water consumption) and three legacy Targets (targets that were not met in SDS 2000 or SDS 2003, but on which we continue to report). Sixteen Strategic Commitments are set out in Table 1 of the Defence SDS 2006 supporting these key goals.
3. SDS Departmental Results for fiscal year 2008-09: Issues have been raised regarding the completion of a number of lagging commitments this year to ensure that all commitments are completed by the end of the SDS 2006 cycle. All commitments will be closely monitored including following up with the individual sites that are lagging.
4. Supporting Performance Measures: The following outputs/outcomes are imbedded in each of the four overarching Strategic Commitments as found below:
  1. Move toward a framework of land use management designed to encourage innovative approaches to the stewardship of those lands with the ultimate goal of putting the lands with which Defence is entrusted on a "steady state" footing of sustainability;
    • SC.1.1. Measuring the sustainability of military training areas and managing them accordingly; and
    • SC.1.2. Developing urban forest policies, and implementing Urban Forest plans at all affected bases.
  2. Actively promote the application of innovative sustainable infrastructure principles and concepts and share "lessons learned" with the broader federal community:
    • SC.2.2. Improving our understanding of the feasibility of "bundled" Energy Performance Contracts and sharing the lessons learned with our federal colleagues; and
    • SC.2.1. Expanding the integration of the Green Building concept into the total design process.
  3. Implement a proactive and comprehensive "Green Procurement" programme across Defence, meeting the recently promulgated Federal Government Policy on Green Procurement:
    • SC.3.1. Supporting the federal Green Procurement agenda;
    • SC.3.2. Developing and integrating where appropriate Green Procurement modules and messages into all existing training;
    • SC.3.3. Eliminate or reduce 30% of specified nationally procured high-risk hazardous materials (HRHM) from use by 31 March 2010 from a baseline of 31 March 2007;
    • SC.3.4. Acquiring, using and maintaining greener vehicles;
    • SC.3.5. Reducing vehicle GHG emissions by 15% within the commercial pattern on road vehicle departmental fleet by 31 March 2010;
    • SC.3.6. Piloting a managed print solution; and
    • SC.3.7. Minimizing the environmental liability associated with bulk petroleum fuel storage infrastructure and distribution assets.
  4. Actively and innovatively prevent negative environmental impacts of specific activities over which Defence can exercise a mitigating influence:
    • SC.4.1. Reducing disposal of waste fuel by 31 March 2010;
    • SC.4.2. Reducing the long-term impact of releases to the environment by: Increasing the recovery of lead by 5% from 2003/2004;
    • SC.4.3. Reduce the contaminated sites liability by 7% per year from a baseline of 31 March 2006;
    • SC.4.4. Reducing the weight of halocarbons by 5% in in-service systems and equipment as expressed by their Ozone Depletion Potential per year by 31 March 2010 from a baseline of 31 March 2004; and
    • SC.4.5. Reducing Greenhouse Gas (GHG) emissions by 134.9 kilotonne carbon dioxide equivalent by 2010 from 1998 baseline.
5. Achieved SDS Departmental Results for fiscal year 2008-09: For the second year of reporting on SDS 2006:

One Strategic Commitment has been met:

  • SC.3.1. (Supporting the federal Green Procurement agenda);

Eleven Strategic Commitments are on track:

  • SC.1.2. (Developing urban forest policies, and implementing Urban Forest plans at all affected bases);
  • SC.2.2. (Improving our understanding of the feasibility of "bundled" Energy Performance Contracts and sharing the lessons learned with our federal colleagues);
  • SC.3.2. (Developing and integrating where appropriate Green Procurement modules and messages into all existing training);
  • SC.3.3. (Eliminate or reduce 30% of specified nationally procured high-risk hazardous materials (HRHM) from use by 31 March 2010 from a baseline of 31 March 2007);
  • SC.3.4. (Acquiring, using and maintaining greener vehicles);
  • SC.3.5. (Reducing vehicle GHG emissions by 15% within the commercial pattern on road vehicle departmental fleet by 31 March 2010);
  • SC.3.7. (Minimizing the environmental liability associated with bulk petroleum fuel storage infrastructure and distribution assets);
  • SC.4.2. (Reducing the long-term impact of releases to the environment by: Increasing the recovery of lead by 5% from 2003/2004);
  • SC.4.3. (Reduce the contaminated sites liability by 7% per year from a baseline of 31 March 2006);
  • SC.4.4. (Reducing the weight of halocarbons by 5% in in-service systems and equipment as expressed by their Ozone Depletion Potential per year by 31 March 2010 from a baseline of 31 March 2004); and
  • SC.4.5. (Reducing Greenhouse Gas (GHG) emissions by 134.9 kilotonne carbon dioxide equivalent by 2010 from 1998 baseline).

Four Strategic Commitments are lagging:

  • SC.1.1. (Measuring the sustainability of military training areas and managing them accordingly);
  • SC.2.1. (Expanding the integration of the Green Building concept into the total design process;
  • SC.3.6. (Piloting a managed print solution); and
  • SC.4.1. (Reducing disposal of waste fuel by 31 March 2010).

None of the three SDS 2000 Legacy targets, also pursued during SDS 2003, were met:

  • SDS 2000 target A.3. (Develop and implement Integrated Pest Management (IPM) Plans at all Bases /Wings);
  • SDS 2000 target B.1. (Develop and implement Hazardous Material Management Plans at all Bases/Wings/Organizations); and
  • SDS 2000 target D.1. (Implement Environmental Management Systems).

Source: Assistant Deputy Minister (Infrastructure and Environment) Group


Green Procurement


Meeting Policy Requirements

1. Has the department incorporated environmental performance considerations in its procurement decision-making processes?

  • In progress.

2. Summary of initiatives to incorporate environmental performance considerations in procurement decision-making processes:

  • (SC 3.1) Chaired by Public Works and Government Services Canada/ Office of Greening Government Operations (PWGSC/OGGO), DND participates in the Commodity Management Working Group which is comprised of various federal departments. During the evaluation of Goods and Services Special Operation Agencies (SOAs), materiel is also reviewed for having environmentally friendly attributes.
  • (SC 3.2) Personnel (CF and civilian) performing Materiel Acquisition and Support (MA & S) functions have been identified to complete the Canada School of Public Service (CSPS) Campus Direct on-line Green Procurement Course C215E/F. To complement this, Green Procurement modules have been created and are being incorporated into key on-line and existing MA & S procurement course content.
  • DND is an active member of the PWGSC/OGGO's office responsible for the development and implementation of green procurement policy, procedures, tools and contracts in coordination with the Treasury Board Secretariat.

3. Results achieved:

  • (SC 3.1) DND participated to 37 federal interdepartmental commodity group management teams where opportunities for procurement of green commodities are identified.
  • (SC 3.2) Department network firewalls precluding personnel from accessing the CSPS Green Procurement Course C215E/F have been resolved. The software solution was trialed to selected Assistant Deputy Minister - Materiel personnel in the National Capital Region in October 2008. Full implementation of the enabling software across DND is scheduled to be completed in July 2009. 445 DND personnel have so far completed the CSPS courses.

4. Contributions to facilitate government-wide implementation of green procurement:

  • (SC 3.1) DND is an active participant in the Commodity Working Group. Due to the volume of materiel/services utilized, this promotes reviews of materiel/services common to and used by other federal departments.


Green Procurement Targets

5. Has the department established green procurement targets?

  • Yes.

6. Are these green procurement targets the same as those identified in your Sustainable Development Strategy (Table 5)?

  • Yes for DND Sustainable Development Strategy SC 3.1 & 3.2.

7. Summary of green procurement targets:

  • (SC 3.1) Commodity Management Reviews (coordinated by PWGSC/OGGO): Number of federal interdepartmental commodity group management teams in which Defence participates as a percentage of relevant commodity groups.
  • (SC 3.2) Issues regarding the firewall and software used which precluded DND personnel from accessing the CSPS on-line training have been resolved. Personnel identified to complete Green Procurement on-line CSPS training should all have completed their green training by 31 March 2010.

8. Results achieved:

  • (SC 3.1) DND participation to relevant commodity groups: 37/37 - 100%.
  • (SC 3.2) DND required personnel (21,203) will have completed the CSPS Green Procurement Course by 31 March 2010. As of 31 March 2009, 445 DND personnel had taken the course.

Source: Assistant Deputy Minister (Infrastructure and Environment) Group


Responses to Parliamentary Committees and External Audits


Response to Parliamentary Committees
Recommendation Government Response/Commitment Status
2nd Report of the Standing Committee on National Defence, 39th Parliament, 2nd Session, "Procurement and associated processes" (Adopted by the Committee on January 31, 2008; Presented to the House on February 7, 2008)
Original report: http://www2.parl.gc.ca/HousePublications/Publication.aspx?DocId=3240298&Language=E&Mode=1&Parl=39&Ses=2"
Government response: http://www2.parl.gc.ca/HousePublications/Publication.aspx?DocId=3546108&Language=E&Mode=1&Parl=39&Ses=2
1. These ten points (proposed by a Committee witness) may also be used by the Government as fundamental guiding principles in the reform of the defence procurement system. The Government recognizes that this is an area of considerable complexity and importance. The government intends to continue reform in order to pursue a fair, open and transparent procurement process and one that ensures that the taxpayer's money is invested appropriately and diligently. (Full response available online).
  1. Statements of Requirements. No change
  2. Early Industry involvement. The Department has initiated project ACCORD to examine the establishment of a Government-Industry Centre for Capability Analysis (similar to the successful Australian and UK models). Project ACCORD is scheduled to initiate a Request for Proposal for the Options Analysis phase of the project in the August timeframe. This Options Analysis will examine possible impediments to the establishment of such a mechanism such as protecting Intellectual Property Rights and preserving an environment conducive to competition.
  3. Integrated Project Teams. No change. In terms of other innovative approaches to account for the experience base through attrition and cuts that have occurred, realignment of scarce resources into two major project divisions to oversee key transformation projects has been achieved. These divisions act as centres of expertise providing focused, highly skilled personnel that are capable of managing complex acquisitions.
  4. Risk. Piloting of the new policy remains ongoing.
  5. Performance Specs. As a result of utilizing performance specifications and implementing other procurement reforms, timeframes for the acquisition of materiel were reduced from 107 months to less than 48 months.
  6. Vendor performance. The Department is continuing work on finalizing a Vendor Performance measurement process specific to defence acquisitions that would build upon efforts currently underway in this area by Public Works and Government Services Canada (PWGSC).
  7. Procurement strategy. No change.
  8. Defence industrial strategy. Work continues on developing ways to better link defence spending as outlined in the Canada First Defence Strategy (CFDS) to domestic economic benefit as well as developing a structured approach to strategic technology development. During the Fall of 2009, DND along with Industry Canada, PWGSC and the Canadian Association for Defence and Security Industries will hold a series of "Engagement Events" with defence related industries across Canada aimed at better understanding industry's concerns and priorities.
  9. Contractor incentives. No change.
  10. Funding stability. No change.
2. The Department of National Defence investigate ways of making sole source contracting more transparent and accountable, with the aims of substantially reducing wait times for major capital projects necessary for Canada's national security. The Government acknowledges the sensitive nature of sole-source procurement and is committed to improving Parliament's and Canadians' understanding of this process. The Government Contracts Regulations (GCRs) stipulate that competitive tendering should be the norm but do also recognize the legitimate need for the Government to sometimes enter into sole-source contracts. In fall 2007 the Government formally implemented an additional level of scrutiny to address the perception of a lack of fairness and transparency in some sole-source transactions. (Full response available online) Sole source is typically used as a last choice and is subject to national and international trade agreements and the Government Contracts Regulations. The latter recognizes only four situations in which sole sourcing may be considered; pressing emergency, estimated expenditure does not exceed $25,000, or in certain specific situations $100,000; not in the public interest to solicit bids and only one person is capable of performing the contract.
3. Out of concerns for transparency and accountability, the National Defence Capability Plan be made public and tabled with the Standing Committee on National Defence by the end of the current fiscal year. On May 12th, 2008, the Government unveiled the Canada First Defence Strategy (CFDS), its comprehensive plan to ensure the Canadian Forces (CF) have the people, equipment, and support they need to meet Canada's long-term domestic and international security challenges… This announcement complements the significant steps already taken by the Government to strengthen the CF. The CFDS will expand the Regular Force to 70 000 and the Reserve to 30 000, improve key CF infrastructure, increase the overall readiness of the CF and proceed with major fleet replacements projects: surface combatant ships, maritime patrol aircraft, fixed-wing search and rescue aircraft, fighter aircraft, and land combat vehicles and systems. By providing long-term funding stability to the CF and by setting the foundations for a new relationship with industry, the CFDS will allow for greater transparency and accountability in the defence procurement process. Action on this recommendation is completed. The public has full access to the CFDS and to announcements of individual initiatives that stem from the CFDS are opened for competition or development or are completed.
4. Further to the basic elements of the procurement process that the Defence Capability Plan be considered a foundation of that process.

To respond to ongoing and future requirements, the Canadian Forces are transforming and modernizing their maritime, land, air, and special operations forces to meet the challenges of the 21st century. To this end a comprehensive investment plan is being written to implement the CFDS. This plan will define resource allocation plans for equipment, personnel, infrastructure and other essential contributions necessary for the fielding of new equipment and capabilities over the next ten years.

In addition, the formulation of the investment plan is being greatly influenced by the introduction of Capability Based Planning within DND. The Department is currently completing a comprehensive comparison of current force structures and capabilities against the identified needs of the future in order to produce a new strategic capability roadmap. The roadmap will describe a range of capability alternatives and options to address any identified gaps. The alternatives and choices provided in the roadmap are expected to help decision makers to determine what the CF will need to meet the challenges of the evolving security environment. Once agreed, these capability choices will be further articulated and funded in the investment plan. The new roadmap is expected to be ready by mid to late 2008.

This recommendation was accepted and its implementation is completed.

While the Defence Investment Plan was advancing within the Department's internal governance process at the end of the fiscal year, it was approved by Treasury Board on 11 June 2009. This document provides a ten year view of defence investment. This key reference document is used to guide defence planning and internally manage programme resource allocation.

A capability based planning process (CBP) has been adopted by Defence. As part of the CBP, a first version of the strategic capability roadmap was completed in mid-2008. This roadmap was a decision support tool for production of the Investment Plan (IP). A cyclical process of revision and updating of the roadmap and investment plan is being adopted.
5. All major crown projects valued at more than $100M proposed by the Department of National Defence be reported to the Standing Committee on National Defence for examination before the contract is awarded.

The Government notes that the Committee has made this recommendation twice before, but remains of the view that its current reporting to Parliament on defence programs, operations and services, including its provision of information on major crown projects, is fully adequate. In the vast majority of cases, information on these projects is provided to Parliament, and is therefore available to the Committee, well before the contracting stage. To inform Parliament, the Government relies on reporting mechanisms already in place such as the tabling of Main Estimates and Reports on Priorities and Planning, in which the details of major crown projects are provided. At the request of committees, the Minister of National Defence, other Ministers and senior officials appear before Parliament to explain major crown projects proposed by the Department of National Defence.

The release of the CFDS will provide Parliament and Canadians with further insight into the Government's plans. The Government reiterates its commitment to have Ministers and officials appear to discuss all procurement projects of interest to the Committee, and we will continue to cooperate with Parliament in its oversight of defence procurement.

 No change.
6. The Government of Canada investigate ways of changing Department of National Defence procurement processes with the aim of substantially reducing procurement wait times for major defence capital projects necessary for national security. This re-evaluation should include investigating an "in-house" departmental procurement process (i.e. a Defence Department procurement agency), an open and transparent sole sourcing process where appropriate, and a heavier reliance on buying "off the shelf" equipment when suitable.

The Government continues to make improvements to defence procurement policies and processes, and appreciates the Committee's acknowledgement of the successes to date. We can and will do more to simplify and shorten processes while maintaining appropriate safeguards and controls to ensure that Canadians obtain best value from defence spending, and that defence acquisitions are done with as much transparency as possible and subject to adequate checks and balances.

The Committee has correctly assessed that the concept proposed by some to fundamentally restructure the present relationship between DND and PWGSC and create a defence procurement agency is a very complex issue with significant risks on both sides of the argument.

Significant progress has been achieved in the last two years, through collaborative effort on the part of the departments and agencies involved, to reduce the timelines to procure military equipment. In the past, it has taken an average of nine years from the identification of need to contract award. The Government is well on its way to reducing the average time it takes to reach contract award to less than four years, and is committed to continuously improve the efficiency of military procurement.

As noted in the Government's response to Recommendation 2, we are fully committed to open and transparent processes for both competitive and non-competitive procurements.

The Government agrees with the recommendation to purchase mature "off the shelf" solutions wherever appropriate and continues to follow this approach whenever possible. (Full response available online)

 Through the institution of a series of procurement reforms, the Department was able to deliver on requirements in a most expeditious fashion. For example, timeframes for the acquisition of materiel were reduced from 107 months to less than 48 months. This was achieved through implementation of the following reforms:
  • Minimization of technical specifications;
  • Realignment of scarce resources into two major project divisions to oversee key transformation projects. These divisions act as centres of expertise providing focused, highly-skilled personnel, capable of managing complex acquisitions;
  • Use of high-level, performance driven military specifications whenever possible;
  • Assessment of proposals based upon best overall value; and
  • Establishment of long term, domestic-based, in-service support contracts in conjunction with system acquisitions, with a single entity being accountable for system performance and availability.
7. When large capital projects are awarded the Department of National Defence provide a clear public accounting of why certain contractors were chosen over others, with the obvious exception of classified and proprietary information.

The Government already provides as much information as it can concerning the selection of contractors to meet both defence and non-defence requirements. The Committee will understand that the Government is significantly constrained in its ability to publicly release details of contractors' bids and the analysis of those bids by officials, as the bid documents and their contents are proprietary to the bidders. PWGSC manages the bidding process and is responsible to ensure that solicitation documents clearly describe the bid evaluation process and all selection criteria, including terms and conditions, Industrial Regional Benefits, operational requirements and technical requirements. Non-successful bidders are offered the opportunity to meet with PWGSC and DND representatives to review the evaluation of their bids and gain an understanding of how they were rated and why. They are also advised of the independent redress mechanisms available to them if they feel that the bid process was flawed or unfair. The Government views this system, which has been in place for many years, as providing the best combination of transparency of process and protection of bidders' proprietary information or third-party confidential information.

The Department of Public Works and Government Services Act was amended in May 2008 to create the position of Procurement Ombudsman to ensure greater fairness, openness and transparency in procurement. (Full response available online).

 No change.
8. The Department of National Defence and the Department of Foreign Affairs and International Trade continue discussion with the US Department of State to put in place a system that can be considered just for all Canadian citizens and landed immigrants.

The Government agrees with this recommendation and is pursuing discussions with the US to this end.

The United States' International Traffic in Arms Regulations (ITAR), administered by the State Department, regulates the export of militarily sensitive defence articles and services from the United States. For decades, Canada has enjoyed special status as the only country with specific exemptions under these regulations. However, as discussed in the Committee's Report, following the events of 9/11 ITAR provisions were applied more stringently to remaining licensable export authorizations, especially as regards restrictions on dual-nationality provisions. In practice, this has meant that Canadian citizens born or with nationality from one of about twenty-four proscribed countries were generally denied access to ITAR controlled goods or information. This dual-nationality restriction is inconsistent with the application of the Canadian Charter of Rights and Freedoms.

The priority of the Government of Canada is to continue discussion with the Department of State in order to find comparable long-term solutions for other federal government departments with similar requirements and Canadian industry. The Committee will understand that the issue is complex and will likely take some time to fully resolve to the satisfaction of the Government and Canadians. (Full response available online)

 Limited but measured progress has been made to date. Recent internal initiatives by the U.S. government have raised the possibility of a potential multi-lateral solution on ITAR that could address at least some aspects of Canada's concern. The Committee will understand that this issue is particularly complex and may take some time to fully resolve to the satisfaction of the Government and Canadians.
9. The Government continue to evaluate the new practice (single point of accountability contracting), taking into consideration the intention to sustain, promote, and enhance Canadian regional industries and their participation.

The Government acknowledges the concerns raised regarding "single point accountability contracting" and appreciates the Committee's support for taking the time to properly gauge the potential impacts. We will continue to evaluate all of our procurement strategies to ensure that they remain relevant to current national and international conditions, and deliver the best outcomes for the country.

The "single point accountability" or "total solution" procurement strategy has been adopted in certain acquisitions to address both the reality of a global trend towards tighter control by rights owners over the transfer and use of their Intellectual Property, and a number of cases where the separation of equipment acquisition and in-service support contracts has created costly and difficult problems for the Department of National Defence. In some instances these have affected Canadian Forces operations.

The Government will continue to leverage long-term, high quality work opportunities for Canadian industry through industrial and regional benefits (IRBs). The IRBs associated with these in-service support contracts will provide opportunities for Canadian industry to participate on major defence procurements for at least the next twenty years. This will assist in ensuring the long-term viability of the Canadian industry's in-service support capability.

 No change.
1st Report of the Standing Committee on National Defence, 39th Parliament, 1st Session, "Canadian Forces in Afghanistan" (Adopted by the Committee on June 12, 2007; Presented to the House on June 18, 2007)
Original report: http://www2.parl.gc.ca/HousePublications/Publication.aspx?DocId=3034719&Language=E&Mode=1&Parl=39&Ses=1
Government response: http://www2.parl.gc.ca/HousePublications/Publication.aspx?Language=E&Mode=1&Parl=39&Ses=1&DocId=3077584&File=0
5. DND should review the need for some sort of flexible decompression programme for soldiers going home on midtour leave.

DND currently runs an end of tour Third Location Decompression program to provide personnel with an opportunity to achieve a sense of closure to the mission and to prepare them for their return home. Building on pre-deployment briefings, this program increases awareness of operational stress injuries and provides information on what type of help is available. However, five years of research, literature reviews and experience in the area of deployment health indicate that there is no evidence in the scientific literature to suggest that a decompression program decreases the probability of developing, or increases the chance of recovering from, an operational stress injury. National Defence is continuing to evaluate the benefits of the end of tour Third Location Decompression program.

Equally, there is no evidence that a program to prepare soldiers for mid-tour leave would have any significant impact on their chances of developing, or recovering from, an operational stress injury. Moreover, instituting a mid-tour decompression program would create logistical and operational concerns. Currently, the CF aim to have personnel going on mid-tour leave spend a minimum of one day at an intermediate staging base located in Southwest Asia before starting their leave to allow soldiers a period of adjustment from the high operational tempo and stress in a secure environment. Health services and personnel support are available during this time if soldiers require assistance before their departure. As soldiers on a six month tour receive 18 days of mid-tour leave, the Government believes this short break offers soldiers accessible support if needed without unnecessarily reducing the time spent with their friends and families.

DND continues to conduct an end of tour Third Location Decompression (TLD) program to provide personnel with an opportunity to achieve a sense of closure to the mission and prepare them for their return home as an integral component of the re-integration process. While it remains that there is no evidence in the scientific literature to suggest that a decompression program decreases the probability of developing, or increases the chance of recovering from, an operational stress injury; there is sufficient evidence to suggest that TLD is well received by CF members and that the vast majority feel the program is warranted. Indeed, in surveys of 10,598 CF members that attended TLD thus far, 83% recommended the TLD for future rotations. In a follow up 4 - 6 months later on a subsample, 83% believed the TLD made reintegration easier for them, 71% felt it made them realize that there is nothing wrong with seeking help for a mental health problem, 67% felt it helped them readjust to a Canadian way of life and 67% felt it made reintegration easier for their family. As such, DND deems the program a valuable component of assisting CF members with re-integrating back to routine life, post deployment, and the Department continues to evaluate all elements of the program, and its merits on a recurring basis.

The commitment, with respect to mid tour leave, remains extant. The CF aim to have personnel going on mid-tour leave spend a minimum of one day at an intermediate staging base located in Southwest Asia before starting their leave. This allows soldiers a period of adjustment from the high operational tempo and stress in a secure environment. Health services and personnel support are available during this time if soldiers require assistance before their departure.
6. The government should recognize the critical and growing work done by the Operational Stress Injury Social Support Network and support it with appropriate funding and other resources, so that it can keep up with the growing need of caring for returning Afghanistan Veterans and their families. The Government recognizes the critical work being done by the Operational Stress Injury Social Support (OSISS) network. Since the launch of the OSISS network in February 2002, National Defence funding for OSISS initiatives has increased every year. In 2006, the program launched a Bereavement component to support families who lost a loved one. In fiscal year 2007-2008 alone, the Government approved a 25% increase in Department's funding for OSISS. DND implemented a regional management structure to the program in March 2009 recognizing the importance of supporting front line staff and to create a more robust case management capacity within the program. A comprehensive strategy has now been developed leveraging the success of OSISS which will see the development of a Canadian Peer Based Mental Health Initiative which is fully supported by the CF Surgeon General's office and about to be formally approved by the Chief of Military personnel. This strategy includes the development of a comprehensive education/prevention initiative to mitigate Operational Stress Injuries as well as general Mental Health problems, decrease stigma, provide tangible tools for leaders to intervene at their levels and remove many of the existing barriers to mental health care.
12. The Minister of National Defence should appear at least four times a year before the Standing Committee on National Defence, to provide a televised situation report, outlining the status, activity and effect of all Canadian Forces operational missions being conducted at the time. The Government recognizes and supports the principles of ministerial accountability and responsibility to Parliament, including responding to parliamentary committee questions on the Government's policies, programs and activities. The Minister of National Defence has always worked to accommodate committee requests for appearances and will continue to do so in the future. However, designating a specific number of appearances in advance would be arbitrary and, depending on the tempo of CF operations and developments in Afghanistan, may not be the most effective way to provide information to the Committee. The Government of Canada, including DND, is firmly committed to keeping the Standing Committee on National Defence properly informed of the status of the mission in Afghanistan. At the request of the Standing Committee on National Defence, the Minister appeared on 9 February 2009 with senior departmental officials on the Supplementary Estimates (B). During this appearance he took a number of questions from Committee members on the Canadian mission in Afghanistan.
13. In months during which the Committee is not traveling and in which the Minister does not appear, a Canadian Forces senior officer should continue to appear before the Committee to present a briefing on the mission status, activity and effect of all ongoing Canadian Forces operational missions since the last report and provide a view of what can be expected in the next month. During the last year, National Defence accommodated the committee's request to provide a senior officer to deliver bi-weekly and later monthly operational briefings to the committee. National Defence will continue to provide such briefings to the committee.

At the request of the Standing Committee on National Defence, senior military officials provided operational briefings on the Canadian mission in Afghanistan to the Committee on the following occasions:

9 March 2009: Brigadier-General Champagne, Director-General Operations, Strategic Joint Staff
12 June 2008: Brigadier-General Atkinson, Director-General Operations, Strategic Joint Staff
15 May 2008: Brigadier-General Atkinson, Director-General Operations, Strategic Joint Staff
10 April 2008: Brigadier-General Atkinson, Director-General Operations, Strategic Joint Staff

  • Senior leadership of the Strategic Joint Staff remain ready to present to the Standing Committee on National Defence (NDDN), and have done so a number of times. Appearances to end March 2009 were:
    • 2 March 2009
      RAdm Davidson - Director of Staff Strategic Joint Staff -
      Topic: Vancouver 2010
      Topic: CF Engagement in Afghanistan
    • 11 March 2009
      Cmdre Gardam - Director General Plans Strategic Joint Staff -
      Topic: Arctic & Climate Change
16. The Standing Committee on National Defence should visit the Canadian Forces in Afghanistan at least once annually, at an appropriate time, in order to review the status of the mission at that time and any progress being made. Approval for travel must be sought from the House of Commons and the travel funds are part of a separate budget request. While the Government supports the idea of annual visits in principle, operational and security considerations may affect the timing of any visit. For example, increased operational tempo could limit the availability of personnel the committee might wish to meet, thereby making it difficult for the committee to achieve the strategic objectives of its visit at that particular time. Visits may also be affected by the availability of air transport and accommodation, and be subject to modification due to operational priorities. The Department of Foreign Affairs and International Trade is the lead department for consideration of any VIP travel within a nation outside of Canada, including Afghanistan. The Department of National Defence works to implement travel requests to theatre as approved by the Department of Foreign Affairs and International Trade and must respect other restrictions as dictated by the Government of Afghanistan or NATO. The Standing Committee on National Defence traveled to Afghanistan from 25-27 May 2008.
19. The government should increase the Canadian Forces contributions to Afghan National Army training so that, as the Afghan National Army grows and matures, higher level collective training of new kandaks can be conducted prior to real operations.

The Government recognizes the importance of increasing its contribution to Afghan National Army training; the conditions are now right for Canada to redouble its training and mentoring initiatives and to focus that effort on achieving results in Kandahar Province to reinforce our security, development and reconstruction achievements. Since 2006, Canada has fielded a large Operational Mentoring and Liaison Team (OMLT) in support of the 1st Kandak of the 205th Brigade based in Kandahar Province. With newly formed Kandaks arriving in Kandahar Province in July 2007, Canada augmented its contributions to ANA training by increasing the number of OMLTs to six and assigning them responsibility for three infantry Kandaks, a Combat Support Kandak, a Combat Service Support Kandak, and a Brigade Headquarters. These new OMLTs will be instrumental in raising the operational effectiveness of the recently arrived ANA units to measurable proficiency standards such that they can first participate in International Security Assistance Force (ISAF) missions in support of Joint Task Force Afghanistan, and in time, lead security operations.

The Canadian effort is fully consistent with recent calls by NATO for increased contributions to ANA capacity building, in particular through the provision of Operational Mentoring and Liaison Teams. NATO has expressed its satisfaction with Canada's increased efforts in this respect.

Decisions regarding future levels of Canadian contributions to ANA training will be determined by the ANA's progress and capacity, CF operational requirements and assistance being provided by allies. (Full response available online)

The Government recognizes the importance of increasing its contribution to Afghan National Army training; the conditions are now right for Canada to redouble its training and mentoring initiatives and to focus that effort on achieving results in Kandahar Province to reinforce our security, development and reconstruction achievements. Since 2006, Canada has fielded a large Operational Mentoring and Liaison Team (OMLT) in support of the 1st Kandak of the 205th Brigade based in Kandahar Province. With newly formed Kandaks arriving in Kandahar Province in July 2007, Canada augmented its contributions to ANA training by increasing the number of OMLTs to six and assigning them responsibility for three infantry Kandaks, a Combat Support Kandak, a Combat Service Support Kandak, and a Brigade Headquarters. These OMLTs are instrumental in raising the operational effectiveness of the ANA units to measurable proficiency standards such that they can participate in International Security Assistance Force (ISAF) missions in support of Joint Task Force Afghanistan, and lead security operations.

The Canadian effort is fully consistent with recent calls by NATO for increased contributions to ANA capacity building, in particular through the provision of Operational Mentoring and Liaison Teams. NATO has expressed its satisfaction with Canada's increased efforts in this respect.

Decisions regarding future levels of Canadian contributions to ANA training will be determined by the ANA's progress and capacity, CF operational requirements and assistance being provided by allies. In that respect, we are planning to add an OMLT in 2010 which will be assigned to a fourth infantry Kandak that is being formed to operate in Kandahar Province.
11th Report of the Standing Committee on Public Accounts, 39th Parliament, 1st Session, "Chapter 2, National Defence - Military Recruiting and Retention" of the May 2006 Report of the Auditor General of Canada, (Adopted by the Committee on November 30, 2006; Presented to the House on December 7, 2006)
Original report: http://www2.parl.gc.ca/HousePublications/Publication.aspx?DocId=2560007&Language=E&Mode=1&Parl=39&Ses=1
Government response: http://www2.parl.gc.ca/HousePublications/Publication.aspx?Language=E&Mode=1&Parl=39&Ses=1&DocId=2830673&File=0
2. That the Department of National Defence report progress in the implementation of its action plan to strengthen the recruitment and retention of military personnel in its annual Departmental Performance Report, beginning with the Report for the period ending 31 March 2007. The Department should also report progress in implementing its national recruiting attractions plan as well as its strategic guidance on national recruiting. In making this information available to Parliament, the Department must make clear reference to the outcomes that are being achieved. The Department of National Defence will ensure that the information identified in this recommendation is included in its annual Departmental Performance Report beginning with the report for the period ending 31 March 2007. The National Attractions Plan is embedded in the CF Recruiting Group's (CFRG) Annual Operations Plan, which has been published for the past three years. Recruiting targets for fiscal year 2007-08 were achieved and for fiscal year 2008-09 CFRG continued to improve on the enrolment targets for Priority Occupations. Also of note, the Strategic Guidance on National Recruiting was published in February 2007.
3. That the Department of National Defence establish a formal commitment to process applications for membership in the Canadian Armed Forces within thirty days, ensure that all applicants are made aware of that commitment and report its progress in meeting those goals in its annual Departmental Performance Report. The Government will continue to explore additional opportunities to streamline applicant processing and is progressing with the development of a robust performance measurement system based on the Treasury Board framework for service standards. Progress in meeting the goals identified above will be included in the annual Departmental Performance Report for the Department of National Defence, beginning with the report for the period ending 31 March 2007. Attainment of the goal for applicant processing of 30% completed in 5 days and 70% in 30 days continues to be a significant challenge. Improvements were made in applicant service, eliminating waiting time and in the prioritization of processing. While the Commanding Officers of Recruiting Centres have been given the authority to conduct parallel processing in order to maximize the use of their resources at any given time and ensure concurrent activity, delays due to difficulties in resolving issues discovered in processing such as medical fitness questions requiring specialist follow-up, further information from applicants or confirmation of pre-security screening status continue to impede significant improvement in average processing times.
8. The Department of National Defence determine the rate of attrition for female members of the Canadian Forces and, in its exit surveys, seek to establish which factors prompt female members to leave the Forces before full service is completed. The results, along with corrective measures taken to encourage women to complete their full service should be reported in the Department's annual Performance Reports, beginning with the Report for the period ending 31 March 2008. A comprehensive survey analysis that will be conducted in the fall of 2007 will allow the Government to better understand the reasons female members of the Canadian Forces decide to leave the military. Should trends be identified that indicate a need for change, the Government will initiate appropriate corrective measures. The results of this survey analysis, together with any corrective measures undertaken, will be reported in the Departmental Performance Reports, beginning with the report for the period ending 31 March 2008.

The CF Retention Strategy was approved by the Armed Forces Council in March 2009 and includes six lines of operations and 43 initiatives. The main lines of operations are Career/Employment Management, Career/Family Balance and Basic Training. Four of the initiatives have been implemented and the rest will be implemented over the next two years. The strategy is based on CF attrition research findings and is designed to address attrition issues and increase retention at two specific points. The first one is attrition occurring during the first year of service (YOS) and the second is attrition occurring at and after 20 YOS.

Female Attrition Rates for the CF Regular Force


Fiscal year Officers Non-Commissioned Members
2001/2002 4.7% 6.9%
2002/2003 6.5% 6.7%
2003/2004 6.6 % 6.5%
2004/2005 5.5% 6.3%
2005/2006 6.0% 6.2%
2006/2007 5.0% 8.1%
2007/2008 6.9% 9.8%
2008/2009 5.6% 8.1%

The female attrition rates in fiscal year 2008-09 are lower then that for men. The male rates in 2008-09 were 6.9% for officers and 9.3% for Non-Commissioned Members (NCM). A study examining retention of women in navy occupations is being conducted.
9. The Department of National Defence begin to report the results of the exit surveys it conducts among members of the Canadian Forces in its Departmental Performance Reports beginning with the Report for the period ending 31 March 2007. References to the methodology and scope of the surveys should be included. The Department of National Defence will ensure that the information identified in this recommendation is included in its annual Departmental Performance Report. However, since the comprehensive analysis of survey results will not commence until the fall of 2007, the reporting of these results can only begin with the report for the period ending 31 March 2008. The Exit Survey is given to all Regular Force members who are leaving the CF voluntarily. Survey completion is voluntary. Analysis of Exit Survey data from 2005 to 2008 has begun. The objective of the analysis is to assess departing members' satisfaction (agreement) with several organizational issues as well as determine the extent to which these organizational issues and dissatisfiers influence their decision to leave the CF. Final results will be formally reported next year by the newly stood up team within Defence dedicated to the Attrition and Retention research and analysis.
10. That the Department of National Defence establish a target for the maximum acceptable rate of attrition of its trained effective strength and monitor the performance of the package of measures it has instituted to meet that target. The Department should begin to report its progress in its annual Departmental Performance Report beginning with the report ending 31 March 2007. The Government will include data regarding attrition rates in the Department of National Defence annual Departmental Performance Report beginning with the report ending 31 March 2007. However, the data will be based on trend analysis as opposed to pre-determined targets.

During fiscal year 2008-2009, the CF set the Strategic Intake Plan at its highest level in many years and sought to recruit 7,995 personnel, up from 6,716 during 2007-08. Actual recruiting intake of 7,701 personnel resulted in an overall success rate of 96.3%. In order to help achieve the recruiting target for this fiscal year, the Department over-recruited for the infantry occupation by 44 percent. Once over-recruiting of the infantry occupation is factored out, the recruiting success rate was 88% of the established target.

Projected attrition for the year was 6,250 personnel; however, actual attrition was 6,217 personnel, for a 12-month average attrition of 9.1%. A decline in attrition was observed in the 3rd and 4th quarters of fiscal year 2008-09, with voluntary attrition in particular showing a downward inflection over the last 6 months of the fiscal year. Although it is too early to make a causal linkage this downturn coincided with the economic downturn.

As a result of continuing success in recruiting and lower than forecast attrition, force growth this past year was approximately 1,494 personnel - more than double the growth in the previous year, which was 628 personnel. Regular Force strength at fiscal year-end was 65,897 personnel and the CF is on track to meet the 2011-12 growth target of 68,000. Successes during the past fiscal year are the result of Canadian Forces Recruiting Group (CFRG) and the Environments to increase recruiting numbers and the Canadian Forces Leadership Recruit School (CFLRS) Retention Strategy that is starting to result in a reduction in Basic Military Qualification (BMQ) attrition. Should the external labour market experience continued and protracted deterioration, reduced attrition may be seen.

15th Report of the Standing Committee on Public Accounts, 39th Parliament, 1st Session, "Chapter 5, Relocating Members of the Canadian Forces, RCMP, and Federal Public Service" of the November 2006 Report of the Auditor General of Canada (Adopted by the Committee on May 16, 2007; Presented to the House on May 29, 2007)
Original report: http://www2.parl.gc.ca/HousePublications/Publication.aspx?DocId=2955368&Language=E&Mode=1&Parl=39&Ses=1
Government response: http://www2.parl.gc.ca/HousePublications/Publication.aspx?Language=E&Mode=1&Parl=39&Ses=1&DocId=3077631&File=0
5. That the Department of National Defence, the Royal Canadian Mounted Police, and Treasury Board Secretariat include, in their annual Departmental Performance Reports, references to the Integrated Relocation-Program as it relates to their employees. Information on the numbers of employees using the Program, the costs, and the extent to which the purposes of the Program are being achieved must be included. This performance information must be included in DPRs beginning with Reports for the period ending 31 March 2008. The Government accepts this recommendation.

The purpose of the Integrated Relocation Program (IRP) is to relocate CF personnel and their families in the most efficient fashion and at the most reasonable cost to the public while having a minimum detrimental effect on the employee and family, and on departmental operations.

During fiscal year 2008-09, the CF authorized the service provider, Royal Lepage Relocation Services (RLRS), to effect relocations for 15,500 personnel. Records indicate that the administration fees paid to RLRS for providing relocation services totalled just under $26.5 million, including GST. The summation of the flow through costs for reimbursements made to CF personnel for relocation benefits were slightly greater than $240 million.

The CF IRP policy manual that was completely re-written in fiscal year 2007-08 for the policy year 2008-09 was very successful. Further adjustments were made to the IRP provisions for FY 2009-10 with the goal of making the program more flexible and providing increased options to members. Surveys administered regarding the level of satisfaction CF members have with the program indicated that the majority of the people are satisfied with the program. Work is nearly complete on the preparation of the Request for Proposal to re-tender the relocation contract through PWGSC for effect 1 December 2009.


Response to the Auditor General (including to the Commissioner of the Environment and Sustainable Development)

Office of the Auditor General (OAG)

During the reporting period, the Auditor General tabled one Chapter in Parliament that included recommendations directed at the Department of National Defence and the Canadian Forces - "Support for Overseas Deployments" tabled in May 2008. In March 2009, the Auditor General tabled "National Security: Intelligence and Information Sharing" which involved the Department and the CF. However, DND was not the lead department for this Chapter, and none of the audit recommendations required a response from DND.

Also during the reporting period in response to the annual request by the OAG, National Defence provided updates on the status of all OAG audit recommendations tabled in Parliament during the five-year period 2002-03 to 2006-07.

In the Chapter entitled "Support for Overseas Deployments", the Auditor General concluded that despite shortcomings in the supply chain, no reports of supply problems that significantly affected operations were identified. However, this was found to be largely due to the high level of dedication and hard work of CF personnel. The Auditor General also concluded that unless certain supply chain deficiencies are addressed, the Department's ability to provide timely and appropriate support could be at risk over time.

The Chapter entitled "National Security: Intelligence and Information Sharing" was a follow up to a November 2003 Audit Observation and the March 2004 Chapter on "National Security". The Auditor General examined the progress made by 14 departments and agencies, including the DND/CF and Communications Security Establishment Canada, that are involved in the management and sharing of intelligence information. For just over half of the original recommendations, progress was listed as satisfactory.

These two Chapters, including departmental responses to the Auditor General's recommendations, can be accessed on the Auditor General's website at the following link: http://www.oag-bvg.gc.ca/internet/English/parl_lpf_e_1193.html.


External Audits

No non-OAG external audits specific to the DND/CF were reported on during 2008-09.

Note: These refer to other external audits conducted by the Public Service Commission of Canada or the Office of the Commissioner of Official Languages.

Sources: Assistant Deputy Minister (Policy) Group; Assistant Deputy Minister (Materiel) Group; Canadian Expeditionary Force Command Group; Canadian Operational Support Command Group;
Chief Military Personnel Group; Strategic Joint Staff Group; and Vice-Chief of the Defence Staff Group


Internal Audits and Evaluations

Internal Audits (current reporting period)

The following table lists the internal audit work completed during fiscal year 2008-09, as well as the audit work active in fiscal year 2008-09 that has carried forward into fiscal year 2009-10. Completed audit reports, which include management action plans developed in response to audit recommendations, can be found at the following link: http://www.crs-csex.forces.gc.ca/reports-rapports/index-eng.asp


Name of Internal Audit Audit Type Status Completion Date1
Internal Audit of the Close-In Weapon System Support Contracts Contract Management Completed December 2008
Audit of Inventory Management: Stocktaking, Adjustments and Write-Offs Financial Management / Asset Management Completed December 2008
Follow-Up on Internal Audit: Airbus Maintenance Contract Follow-Up/Asset (Contract) Management Completed December 2008
Follow-Up on Audit of Security Clearance Process Follow-Up/Security Completed September 2008
Follow-Up on Audit of Sensitive Inventories Follow-Up/Security Completed September 2008
Follow-Up on Internal Audit: Combat System Engineering Support (CSES) Contracts Follow-Up/ Asset (Contract) Management Completed September 2008
Follow-Up on Internal Audit: Wheeled Light Armoured Vehicle (WLAV) Life Cycle Support Contracts Follow-Up/ Asset (Contract) Management Completed September 2008
Audit of Chemical, Biological, Radiological and Nuclear (CBRN) Defence Omnibus Contract Capital Acquisition Completed June 2008
Audit of Land Command System Support Contract Asset (Contract) Management Completed June 2008
Audit of Contractor-Held Inventory Asset Management/Financial Management Completed June 2008
Audit of Year-End Expenditures Financial Management Completed June 2008
Audit of M113 Armoured Personnel Carrier (APC) Intellectual Property Other Completed 1st Quarter FY 2009-10
Audit of Capital Asset Valuation Financial Management/ Asset Management Completed 1st Quarter FY 2009-10
Audit of Fixed-Wing Search and Rescue Acquisition Capital Acquisition Completed 2nd Quarter FY 2009-10
Review of Human Resources Service Delivery People Management In progress 2nd Quarter FY 2009-10
Audit of Contaminated Sites Liability Environmental Management In progress 2nd Quarter FY 2009-10
Review of TB Submission Process Capital Acquisition/Corporate Governance In progress 2nd Quarter FY 2009-10
Risk Analysis of Contracts Risk Analysis - Asset (Contract) Management In progress 2nd Quarter FY 2009-10
Audit of Inventory Management: Surpluses and Disposal Asset Management/ Financial Management In progress 2nd Quarter FY 2009-10
Follow-Up on Internal Audit: CP140 Aurora Maintenance Contracts Follow-Up/ Asset (Contract) Management In progress 2nd Quarter FY 2009-10
Follow-Up on IT Security: Certification & Accreditation Follow-Up/ Security In progress 2nd Quarter FY 2009-10
Audit of the Canadian Forces Housing Agency (CFHA) Agency Operations In progress 3rd Quarter FY 2009-10
Audit of Revenue Management Financial Management In progress 3rd Quarter FY 2009-10
Audit of Security Incident Management Security In progress 3rd Quarter FY 2009-10
Audit of Minor Warships and Auxiliary Vessel In-Service Support Contract Asset (Contract) Management In progress 3rd Quarter FY 2009-10
Audit of the Implementation of Modern Management Financial Management / Corporate Governance In progress 3rd Quarter FY 2009-10
Risk Analysis of Information Management Projects IM/IT Management In progress 2nd Quarter FY 2009-10
Audit of Contracting for Professional Services Contract Management In progress 3rd Quarter FY 2009-10
Audit of Leave & Absence Administration People Management In progress 3rd Quarter FY 2009-10
Chief Review Services Perspective 2008 Other In progress 3rd Quarter FY 2009-10

Note: Date approved or expected to be approved by the DND/CF Audit Committee

Evaluations (current reporting period)

The following table lists the evaluation work completed during fiscal year 2008-09, as well as the evaluation work active in fiscal year 2008-09 that has carried forward into fiscal year 2009-10. Completed evaluation reports, which include management action plans developed in response to evaluation recommendations, can be found at the following link: http://www.crs-csex.forces.gc.ca/reports-rapports/index-eng.asp


Name of Evaluation Program Activity Evaluation Type Status Completion Date1
Summative Evaluation of the Class Grant Program for the Offices of the National Cadet Leagues Contribute to Canada and the International Community Summative Completed September 2008
Summative Evaluation of the Chemical, Biological, Radiological, Nuclear (CBRN) Research and Technology Initiative (CRTI) Generate & Sustain Integrated Forces Summative Completed June 2008
Formative Evaluation of the Contribution Program for the Promotion of Defence and Diplomacy Objectives Implemented by the Military Training Assistance Program (MTAP) Contribute to Canada and the International Community Formative Completed June 2008
Evaluation of the Benevolent Fund Class Grant Program: Royal Canadian Naval Benevolent Fund Generate & Sustain Integrated Forces Summative Completed 1st Quarter FY 2009-10
Evaluation of the Contribution to the Civil Air Search and Rescue Association (CASARA) Generate & Sustain Integrated Forces Summative Completed 1st Quarter FY 2009-10
Evaluation of the Contribution to the Biological and Chemical Review Committee Contribute to Canada and the International Community Summative Completed 1st Quarter FY 2009-10
Summative Evaluation of the Contribution Program for the Promotion of Defence Diplomacy Objectives (MTAP) Contribute to Canada and the International Community Summative Completed 1st Quarter FY 2009-10
Evaluation of CF Recruiting, Absorption and Retention Generate & Sustain Integrated Forces Impact In progress 3rd Quarter FY 2009-10
Evaluation of the Care of the Ill and Injured and Their Families Generate & Sustain Integrated Forces Impact Completed 2ndQuarter FY 2009-10
Evaluation of the Named Grant to Institute of Environmental Monitoring & Research Contribute to Canada and the International Community Summative In progress 3rd Quarter FY 2009-10
Evaluation of the Contribution Program in Support of the Search and Rescue New Initiatives Fund Contribute to Canada and the International Community Summative Completed 2nd Quarter FY 2009-10
Evaluation of Alternative Dispute Resolution Internal Services Implementation Completed 2nd Quarter FY 2009-10

Source: Chief of Review Services Group
Note: Date approved or expected to be approved by the Deputy Minister / Chief of the Defence Staff after review by the DND/CF Evaluation Committee.