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http://www.theglobeandmail.com/servlet/story/RTGAM.20051110.military11/BNStory/National/
By MICHAEL DEN TANDT
Thursday, November 10, 2005 Posted at 7:48 PM EST
Globe and Mail Update
Ottawa - On Monday key cabinet ministers will discuss plans to bypass much of the traditional competitive bidding process for a $12.2-billion purchase of 50 military aircraft -- including 15 Chinook helicopters for the mission in Afghanistan and 16 Hercules transports -- because the need for new planes is so urgent, sources say.
The proposal, driven by Chief of Defence Staff Rick Hillier, has tacit approval from Defence Minister Bill Graham and Prime Minister Paul Martin, sources say. But it is sending ripples of distress through the Canadian aerospace and defence industry, which stands to lose the biggest defence procurement contracts in a generation.
Gen. Hillier, a former commander of allied troops in Afghanistan, has mounted an intense personal lobbying effort to sell the fast-track plan to a reluctant political and policy establishment, sources say. His argument, in essence, is that the military's need for hardware is so urgent that it would be irresponsible to stick to the old decision-making process, which often took several years.
"Hillier's basically saying, we're getting this because I know what we need," said a defence department official familiar with the situation. "It's leadership. We haven't had that before."
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In addition to helicopters and transports, the purchase is expected to include 15 fixed-wing search-and-rescue aircraft and four "northern utility" planes, according to defence department documents obtained by The Globe and Mail.
Department officials have not singled out a favoured rescue aircraft, but are leaning toward the C27J, made by Italian-based Alenia, defence industry sources say. Another option is Spanish-based EADS's C-295. A modified version of Montreal-based Bombardier's turboprop Dash 8 runs a distant third, sources say.
If the plan goes ahead, the first of the new aircraft would be delivered within 36 months, with the last coming into service within 60 months, the documents show. The plan is scheduled to be discussed Monday by Cabinet's powerful operations committee.
Global aerospace industry players, including Montreal-based Bombardier Inc. and Airbus, 80-per-cent owned by EADS, have mounted intense lobbying campaigns of their own to persuade the federal government that Gen. Hillier's plan is rash and will cost far more than it should because the new process is inherently non-competitive.
"It's the same thing as Gomery," said one defence industry insider. "They're saying, 'we've got to do it quickly, so we have to circumvent the process.'"
No one in the Canadian aerospace industry disagrees with the notion that the Canadian military needs new hardware as soon as possible, the insider said. "It's how [Gen. Hillier] is going about doing it. It's going to get them in trouble."
The heart of the matter, he said, is that Gen. Hillier is charismatic and persuasive, and, by virtue of his experience in Afghanistan and elsewhere, has strong ideas about what equipment he likes. As a result, he's pulled the politicians along in his wake, the source said. "He's going for the brass ring."
Although the proposed new procurement process pays lip-service to open bidding, the industry insider said, it's anything but. "They'll claim there's a competition. But the requirements have been set up so that only one aircraft will get the nod."
Senior defence department officials, while not denying this, view it differently.
It would be idiotic not to take senior officers' combat knowledge into account in making procurement decisions, they say. And traditional Canadian procurement is too bureaucratic and slow for a military heading into combat, with a dire need for airlift, and where there are already obvious solutions in the field.
The Chinook-CH47 helicopter, a department official pointed out, is in use now in Afghanistan. "If there's another helicopter that can do the job, we're happy to have it," the official said. "Bring it on." But the Chinook is the only rotary-wing aircraft that can operate "at 40 degrees, up 5,000 feet, pulling 5,000 pounds," the official said.
As for the Hercules transports, he said, the Canadian military uses an older version of the same aircraft now, which makes them easier to integrate.
The Canadian Defence Industries Association has urged the Liberal government to introduce "performance-based procurement," and that's what the government has promised and the military is proposing, the official said.
Tim Page, president of the CDIA, said that's open to interpretation. "The question is, what is a performance-based approach?"
Critics of Gen. Hillier's proposal say there may be aircraft other than the Chinook and Hercules that could do the job as well or better, though not in the precise way specified by the government's request for proposals. "Performance-based is you get yourself from home to work in X time," said one. "You're not out there deciding whether you want to drive in a Lamborghini or a Toyota Corolla."
The Canadian defence industry is adamant, Mr. Page said, that the government should take economic and regional development into account.
Bombardier's proposal to build search-and-rescue craft at its de Havilland plant in Toronto, a defence department official said, has created substantial backroom pressure on Prime Minister Paul Martin to have at least some of the new aircraft built in Canada. Ontario minister Joe Volpe has been active on the file, sources say.
But so far, he said, Mr. Martin has resisted the pressure. He has said the process must be transparent, founded on clear performance markers and open enough to allow any company an opportunity to participate, if it can. Beyond that, the message from the Prime Minister has been that "we will fulfill the commitment to get the troops the equipment they need," the official said.
Senator Colin Kenny, who heads the Senate defence committee, said the dilapidated state of the Canadian military's planes and helicopters requires urgent solutions. He said few in the military would find fault with either new Chinook helicopters or new Hercules transports. "Few people understand the extent of the rust-out," he said.
By MICHAEL DEN TANDT
Thursday, November 10, 2005 Posted at 7:48 PM EST
Globe and Mail Update
Ottawa - On Monday key cabinet ministers will discuss plans to bypass much of the traditional competitive bidding process for a $12.2-billion purchase of 50 military aircraft -- including 15 Chinook helicopters for the mission in Afghanistan and 16 Hercules transports -- because the need for new planes is so urgent, sources say.
The proposal, driven by Chief of Defence Staff Rick Hillier, has tacit approval from Defence Minister Bill Graham and Prime Minister Paul Martin, sources say. But it is sending ripples of distress through the Canadian aerospace and defence industry, which stands to lose the biggest defence procurement contracts in a generation.
Gen. Hillier, a former commander of allied troops in Afghanistan, has mounted an intense personal lobbying effort to sell the fast-track plan to a reluctant political and policy establishment, sources say. His argument, in essence, is that the military's need for hardware is so urgent that it would be irresponsible to stick to the old decision-making process, which often took several years.
"Hillier's basically saying, we're getting this because I know what we need," said a defence department official familiar with the situation. "It's leadership. We haven't had that before."
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click here
click here
In addition to helicopters and transports, the purchase is expected to include 15 fixed-wing search-and-rescue aircraft and four "northern utility" planes, according to defence department documents obtained by The Globe and Mail.
Department officials have not singled out a favoured rescue aircraft, but are leaning toward the C27J, made by Italian-based Alenia, defence industry sources say. Another option is Spanish-based EADS's C-295. A modified version of Montreal-based Bombardier's turboprop Dash 8 runs a distant third, sources say.
If the plan goes ahead, the first of the new aircraft would be delivered within 36 months, with the last coming into service within 60 months, the documents show. The plan is scheduled to be discussed Monday by Cabinet's powerful operations committee.
Global aerospace industry players, including Montreal-based Bombardier Inc. and Airbus, 80-per-cent owned by EADS, have mounted intense lobbying campaigns of their own to persuade the federal government that Gen. Hillier's plan is rash and will cost far more than it should because the new process is inherently non-competitive.
"It's the same thing as Gomery," said one defence industry insider. "They're saying, 'we've got to do it quickly, so we have to circumvent the process.'"
No one in the Canadian aerospace industry disagrees with the notion that the Canadian military needs new hardware as soon as possible, the insider said. "It's how [Gen. Hillier] is going about doing it. It's going to get them in trouble."
The heart of the matter, he said, is that Gen. Hillier is charismatic and persuasive, and, by virtue of his experience in Afghanistan and elsewhere, has strong ideas about what equipment he likes. As a result, he's pulled the politicians along in his wake, the source said. "He's going for the brass ring."
Although the proposed new procurement process pays lip-service to open bidding, the industry insider said, it's anything but. "They'll claim there's a competition. But the requirements have been set up so that only one aircraft will get the nod."
Senior defence department officials, while not denying this, view it differently.
It would be idiotic not to take senior officers' combat knowledge into account in making procurement decisions, they say. And traditional Canadian procurement is too bureaucratic and slow for a military heading into combat, with a dire need for airlift, and where there are already obvious solutions in the field.
The Chinook-CH47 helicopter, a department official pointed out, is in use now in Afghanistan. "If there's another helicopter that can do the job, we're happy to have it," the official said. "Bring it on." But the Chinook is the only rotary-wing aircraft that can operate "at 40 degrees, up 5,000 feet, pulling 5,000 pounds," the official said.
As for the Hercules transports, he said, the Canadian military uses an older version of the same aircraft now, which makes them easier to integrate.
The Canadian Defence Industries Association has urged the Liberal government to introduce "performance-based procurement," and that's what the government has promised and the military is proposing, the official said.
Tim Page, president of the CDIA, said that's open to interpretation. "The question is, what is a performance-based approach?"
Critics of Gen. Hillier's proposal say there may be aircraft other than the Chinook and Hercules that could do the job as well or better, though not in the precise way specified by the government's request for proposals. "Performance-based is you get yourself from home to work in X time," said one. "You're not out there deciding whether you want to drive in a Lamborghini or a Toyota Corolla."
The Canadian defence industry is adamant, Mr. Page said, that the government should take economic and regional development into account.
Bombardier's proposal to build search-and-rescue craft at its de Havilland plant in Toronto, a defence department official said, has created substantial backroom pressure on Prime Minister Paul Martin to have at least some of the new aircraft built in Canada. Ontario minister Joe Volpe has been active on the file, sources say.
But so far, he said, Mr. Martin has resisted the pressure. He has said the process must be transparent, founded on clear performance markers and open enough to allow any company an opportunity to participate, if it can. Beyond that, the message from the Prime Minister has been that "we will fulfill the commitment to get the troops the equipment they need," the official said.
Senator Colin Kenny, who heads the Senate defence committee, said the dilapidated state of the Canadian military's planes and helicopters requires urgent solutions. He said few in the military would find fault with either new Chinook helicopters or new Hercules transports. "Few people understand the extent of the rust-out," he said.
