WESTDEF address by The Honorable Kent Hehr, Associate Minister of National Defence, Calgary, AB, July 5, 2017

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Thank you, Ms. Tomlin.
(President, Western Canadian Defence Industries Association)

Ladies and gentlemen,

Thank you so much for the invitation to speak to you today. As Associate Minister of National Defence, I am always keen to speak about the extended benefits of a strong and secure Canada, but it is a special pleasure to do so in my hometown.

Having spent most of my life and career in the West, I have seen first-hand the impacts that defence and security industries have both on the regional economy and on our Canadian Armed Forces. Nationwide, the sector generates around $10 billion in sales and employs thousands of people in hundreds of businesses. The West is home to many of the industries that contribute to these numbers. Western businesses produce and provide the physical items our military uses every day – necessities like ships, planes, emergency shelters, sensors, and portable energy systems. These are the products that first come to mind for many people when they think of defence equipment and infrastructure.

But as we know, the defence and security industry covers a much wider spectrum of military needs, including those that are less visible. CAF members also need specialized communications software, nanotechnology, virtual training environments, cyber tools, and a host of other apparatus to perform their work to the highest standard. The Western defence and security industries provide both the tangible and intangible equipment and infrastructure that keep the CAF – and our country – safe.

Last year, our department was in the midst of a Defence Policy Review. We reached out to people and groups across the country – all with a stake in Canada’s approach to safety and security – and asked them to tell us what they thought we needed to do to make our defence apparatus strong, modern, and sustainable.

Western Canada’s defence industries answered the call. At last year’s WestDef, you worked together to produce a white paper with valuable recommendations for our country’s defence future. I’m pleased to say that the new Policy addresses several of your suggestions.

You asked that we move forward on the National Shipbuilding Strategy. Without a doubt, the NSS has had proven benefits for shipbuilders on both the east and west coasts. The government’s partnership with Seaspan in Vancouver will produce two Joint Support Ships for the Royal Canadian Navy, and up to 14 more ships for the Canadian Coast Guard. Not only does the construction of these ships inject approximately $8 billion into the Western economy, their subsequent repair, refit, and maintenance will provide numerous opportunities for the Canadian shipbuilding industry – including British Columbia’s.

The National Shipbuilding Strategy has had, and will continue to have, positive impacts on the Western defence industry and on the Canadian economy at large. A recent report by Pricewaterhouse Coopers (PwC) fixes some firm numbers to these impacts. The firm analysed the comparative benefits of a “made-in-Canada” shipbuilding program versus a “made-in Europe” program. The results were striking:

• For every $1 billion spent on a “made-in Canada” program, the Canadian economy will reap between $1.8 billion and $1.9 billion in benefits. By contrast, a “made-in Europe” program would provide far fewer benefits to Canada.
• On a more tangible level, every $1 billion spent on a domestic program created around 8,000 person years of employment - right here in Canada. And a significant number of those years will be worked by Westerners.
• And while shipbuilders will definitely benefit – with approximately $760 million in economic and tax advantages from the program – they are not the only ones to win with this strategy. The Pricewaterhouse Coopers study notes that the domestic supply chain, R&D and technological sectors, and other defence industry investors are expected to see up to $540 million of economic benefits. And of course, the wider economy will also benefit from the prosperity enjoyed by these groups.

These are the impacts of just one large-scale domestic procurement program, and many of them will be felt in the West. Clearly, supporting our own defence industry is more than a patriotic or sentimental decision. It’s one that makes good economic sense. We at Defence will continue to champion the model of the National Shipbuilding Strategy as part of our procurement process.

As strong as our Western shipbuilding industry is, however, it is equalled by the talents and production of our region’s aerospace sector. In February, we awarded an engine repair, overhaul, engineering, and supply chain management contract to Standard Aero in Winnipeg. This contract will ensure the care and maintenance of the engines in our CP-140 Auroras and CC-130 H Hercules aircraft for at least the next four years. To prepare for our new fixed-wing search-and-rescue aircraft, which will start to be delivered in 2019, a training centre will be built in Comox, BC. This centre will generate local employment not only within the facility itself, but also while it is designed and built. We rely on the expertise of the Canadian defence sector for all dimensions of our equipment, from design and construction to maintenance and life extension. Our defence industry’s range of abilities is vital to Canada’s strength and independence, even as we continue to work with partners in an increasingly interconnected world.

And this interconnectedness – for good or for ill – occurs largely in the virtual realm. As defence specialists, you are well aware of the resulting implications for Canada’s security. Last year’s WCDIA white paper also recommended that Defence make full use of Western industry’s vast experience in cybersecurity, and with good reason. More and more, the cyber realm has become an important front for us to defend. Threats to our infrastructure, economy, and social stability are no longer restricted to physical attacks. We must adjust our capabilities to face this new reality, and our new Defence Policy commits to strengthening our cyber and space defences.

We are creating a new capability within the Canadian Armed Forces – that of Cyber Operator – which focuses on protecting critical networks and data from cyber threats. This new role moves beyond purely defensive cyber activities, providing us with the capability to conduct active cyber operations against external threats to Canada.

This new mandate will require the best technology in the field, and we are confident you can help us provide it. We will invest heavily in research and development of new cyber and space technologies – in areas ranging from surveillance to satellite communications. We know from the important role that Western industry has played in projects such as Polar Epsilon II that the West has the capacity to partner with Defence on other satellite and secure communications initiatives. We look forward to seeing what Western innovators can produce to help protect the integrity of Canada’s cyber infrastructure.

Our need for innovation, however, extends beyond the cyber realm. You have asked through the white paper for a renewed focus on federal research and development, with the goal of creating opportunities for local manufacturing that could ultimately be exported globally.

We agree that defence R&D is an area of incredible potential both for National Defence and for Canadian industry. The global security landscape is shifting rapidly, and new challenges and questions face our armed forces every year:

How do we keep our military on the leading edge of cybersecurity?

What measures can we take to protect CAF members from improvised explosive devices?

Are there ways in which we can leverage remotely piloted systems in order to keep Canadians – and our personnel – as safe as possible?

As dedicated and intelligent as our Defence researchers and scientists are, we know that our best hope of arriving at modern security solutions rests in partnering with leading minds in other sectors.

That’s why the new Defence Policy commits to investing $1.6 billion in science, technology, and innovation over the next 20 years, a substantial portion of which will allow us to launch a new program: Innovation for Defence Excellence and Security, or IDEaS for short.

The IDEaS program will benefit the defence industry in Canada – including the Western defence industry – in several exciting ways.

It will encourage collaboration among industry, academia, government, and other partners to undertake research and development in areas of defence and security where we most need to modernize.

It will create competitions that invite innovators to develop and present their solutions to current defence and security challenges.

And it will ensure that the best R&D is assessed in a timely way by CAF and public safety operators, accelerating the pace at which defence solutions are implemented.

We are excited about the IDEaS program and its potential to improve the CAF’s suite of tools to defend Canada and Canadians. But we are also excited about the opportunities it offers Canadian industry to offer inventive, advanced, and pioneering solutions. And as a Westerner, I know that our defence and security partners will tap into the pioneer spirit that helped build this region and take advantage of every opportunity to showcase their innovation and know-how.

I’ve spent quite a bit of time today on the economic benefits of what the defence and security industries produce, especially here in the West. We at National Defence are fortunate to be able to draw upon such a deep pool of expertise to equip the women and men of our military.

But – if I may briefly speak from my perspective as Minister of Veterans’ Affairs – I also want to draw attention to the depth of skills and knowledge that former CAF members can bring to your sector.

Over 206,000 veterans live in B.C., Alberta, Saskatchewan, and Manitoba. While not all of these individuals are looking for new careers, we know that many of them are. Each year, around 10,000 Canadian Armed Forces members release from the Regular and Reserve Force, and most are eager to embrace new challenges in a civilian career. A natural choice for many is the defence sector. Since this sector is the single biggest employer for CAF veterans, I know I may be preaching to the converted here. That said, I never miss an opportunity to praise their skills.

Veterans are adaptable and resilient, work skilfully under pressure, and have extensive experience both leading and working in teams. These are highly employable traits in any sector, but here’s one that applies specifically to your field: they know Canadian defence. They value its strengths, understand its challenges, and are motivated to find ways to make it the best it can be.

We at both National Defence and Veterans’ Affairs want to help former CAF members make the transition to a fulfilling career. And we want to make it easier for employers like you to engage this highly skilled group. The new Defence Policy outlines our plan to create a new Canadian Armed Forces Transition Group – 1,200 strong – that is devoted to providing veterans individualized resources to support their journey from military to civilian life.

Moreover, Veterans’ Affairs is overhauling career transition services that will include coaching, guidance on education and training, and funding for college, university, or other professional development that will complement their already-impressive skill set. This funding is valid for up to ten years after a CAF member’s release and is applicable to part-time studies. These flexible terms allow for a CAF veteran to enter the civilian workforce, then pursue professional development that will hone their skills in their chosen career – a scenario that enriches both the employee and their employer. More than ever, CAF veterans will continue to be a valuable asset to the defence and security sector – just as Canada’s defence and security sector is a valuable asset to our country.

Within National Defence, we often speak of a Defence Team – the civilians and military members who work together to ensure Canada’s safety and security. I would reinforce that the Defence Team stretches beyond the precincts of our military and our department. It includes partners like you – the researchers, innovators, builders, and industrialists – that develop and furnish the tools that keep Canada safe. Together, we are building a strong, secure, and engaged Canada.

Thank you.