Ottawa Business Journal
Published: Monday, April 7, 2008 Recognizing the economic value of our defence, security industry By now you've noticed that this edition of the OBJ is focused on the Canadian defence and security sector to coincide with the 10th edition of the CANSEC conference, taking place this week at the Ottawa Congress Centre. In a professional capacity, I interact with the defence and security sector and am amazed by the quality of the people and the ingenuity and innovation that drives its product and service offerings. However, this sector is not without its challenges. The first challenge is a festering perceptual issue and one that requires repeated education and refutation of the critics. The second challenge is a more intricate and important question of public policy which will impact the long-term viability of a Canadian presence in these sectors. Unfortunately, CANSEC will likely make as many headlines for the demonstrations and protests it inspires than the well chosen-words of its speakers or the advances in technology on display from some 180-plus vendors. Opponents of CANSEC will crank out their rhetoric of "weapons manufacturers, arms merchants and warmongers" in their facile black-and-white view of the world. Of course, the real world is much more nuanced. This sector is key to Ottawa's technology past and likely a prominent player in our economic future. To start, a cursory review of Denzil Doyle's family tree of local technology companies illustrates that many trace their origins back to Computing Devices in the 1950s and the stimulus provided by the Canada-U.S. Defence Development and Defence Production Sharing Arrangements (DDSA & DPSA respectively). In turn, these arrangements led to various spin-off industrial development and support programs which, over a series of government reorgs, now exist under the umbrella of Industry Canada. What the critics overlook are the civilian/commercial spin-offs that have come from military technology and the dual-use of applications that can address many of today's pressing global issues. As you read this, CANSEC protestors are probably e-mailing each other, chatting on cell phones or using GPS in their cars to get to the Congress Centre. Ironically, all these technologies can trace their birth back to military applications. Maybe the miniaturization in handheld PDAs or the computing power on their notebook PCs is being used to draw up protest march plans and news releases denouncing CANSEC participants. Again, this miniaturization is courtesy of initial defence applications. No doubt they will decry the use of Unarmed Aerial Surveillance vehicles (UAVs), which keep our soldiers safe in Afghanistan, never stopping to think that the same UAV technology can be deployed in fighting forest fires, monitoring high-speed police chases, and measuring changes in the Arctic ice shelf, all the while saving lives and reducing greenhouse gas emissions that would come from the deployment of heavier aircraft with human occupants. This columnist prays that once they are done protesting – which is their democratic right, courtesy of the almost 110,000 Canadian graves dug across the globe in the past 150 years – they return home safely. But if by chance they meet with an accident, they may need a skin graft, artificial blood or brain trauma surgery and thank goodness that these modern medical techniques were pioneered in some far-off war zone. The other challenge that our Canadian defence and security sector must grapple with is the inherent public policy conflict when it comes to government procurement. The front-line buyer (DND, public health agency or local emergency management authority) is rightly concerned with buying the best product; tanks, engines, HAZMAT suits or encryption software, to get the job done. However, other players also factor in budget parameters and in the case of major procurements, the question of "how many jobs will this create in my political backyard," is ever-present. The fancy policy term for this question is industrial and regional benefits, or IRBs. While it is an understandable political desire for government, especially the feds, to attempt to spread defence and security sector work in various regions and amongst downstream Canadian suppliers, there are some within the industry and economic purists from the outside who argue that Canada's IRB strategy further drives up costs – borne by taxpayers – by creating false economies that are dependent upon continued procurement, and unnecessarily delays the already overdue acquisition of equipment to support our forces abroad and protect Canadians ... on our streets, on our own buses and in our own homes. This debate is one of critical importance to the future of the security and defence sector. It is also one that should be monitored by our local cluster of defence-related companies. Above and beyond the value of the equipment and services they provide, they should strive to apply some of the brainpower behind their product innovations to the thought leadership that is needed to further refine and improve Canada's defence and security procurement policies. This is the way forward for these sectors. = = = = = Walter Robinson is a principal with Tactix Government Consulting. He is a former federal director of the Canadian Taxpayers Federation and a former chief of staff to the mayor of Ottawa. |