NDVA Committee Meeting

STANDING COMMITTEE ON NATIONAL DEFENCE AND VETERANS AFFAIRS

COMITÉ PERMANENT DE LA DÉFENSE NATIONALE ET DES ANCIENS COMBATTANTS

EVIDENCE

[Recorded by Electronic Apparatus]

Wednesday, May 13, 1998

• 1538

[English]

The Chairman (Mr. Robert Bertrand (Pontiac—Gatineau—Labelle, Lib.)): Good afternoon, colleagues. Welcome to the meeting this afternoon.

We have Minister Eggleton with us this afternoon. He's here to talk about the main estimates.

I guess you know the routine, Mr. Minister. You have an opening statement, and then we'll go to question period. Perhaps you would like to introduce the witnesses who are here with you before you start your presentation. So whenever you are ready, please start.

Hon. Arthur C. Eggleton (Minister of National Defence, York Centre, Lib.): Thank you, Mr. Chairman.

I have with me Jim Judd, Deputy Minister of Defence, Vice-Admiral Gary Garnett, Vice Chief of the Defence Staff, and Pierre Lagueux, Assistant Deputy Minister in charge of materiel.

Thank you, Mr. Chairman and members of the committee, for the opportunity to appear before you and discuss with you the main estimates.

[Translation]

Last year, I told you about the four priorities I set for myself, the Canadian Forces and the Department of National Defence. Today, I'd like to reiterate these priorities and, at the same time, update you on what we have achieved.

[English]

My first priority of the four is to continue the process of reform, institutional change, and restore thereby the contract of trust between the forces and the Canadian public.

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Much has already been achieved. The progress outlined in the “A Commitment to Change” document, which we released last October, and the comprehensive amendments to the National Defence Act, which are now before your committee and Parliament, are evidence of that.

Moreover, I think the vital trust and confidence of Canadians and the men and women of the forces has been restored. In the flooding in the Saguenay and Manitoba, and more recently with the ice storm in Ontario, Quebec, and New Brunswick, Canadians saw for themselves the professionalism and effectiveness of their forces.

Canadians are proud of the great work the forces are doing abroad. Most of you visited Bosnia—maybe you will be visiting Bosnia—and saw for yourselves what the international community has known for many years and what they've told me on countless occasions, namely, how good our forces are and the contribution they are making to international peace and security.

My second priority is to provide the forces with the best equipment we can afford. Since last November, when I appeared here to discuss such matters, we announced new search and rescue helicopters as well as the acquisition of four diesel-electric submarines. In the last year, we've also seen significant progress on other important capital acquisitions, such as armoured personnel carriers, maritime coastal defence vessels, and the tactical command control and communications system.

Because capital procurement is an ongoing, long-term activity, we cannot look at just the percentage of capital spending in any one year in an isolated way. Procurement planning must be seen in the context of stable and predictable funding over a 10- to 15-year period. We must continuously adjust funding priorities to ensure that the forces have the tools they need to do their job. Funding in this particular year is at a level that is below where we ideally want to be, but as we are able to gain more efficiencies, cut costs in other areas, and streamline how we do business, we'll be able to move up the capital percentage of our budget.

As the Auditor General said in his report, our procurement system is not perfect, but we are working to improve things. We recognize that there still is a steep hill to climb, but I'm confident that we're going to be able to reach the peak.

My third priority is to open the lines of communications within National Defence, the Canadian Forces, to improve their communications with the Canadian public.

Recently we implemented a new communications policy that encourages members of the forces and the department to be more open and speak out about what they are doing. Also, as you know, I established a monitoring committee on change, which is now being chaired by the Honourable John Fraser. That committee is examining all of our reform initiatives and they are monitoring our success in implementing them. Nothing is going to collect dust on a shelf. That can't happen with that monitoring committee. They report to me twice a year, and I've put their preliminary report on our web site so that all Canadians can see it.

I also expect to soon announce the appointment of an ombudsman.

As I mentioned to you a few weeks ago, in our comprehensive proposed amendments to the National Defence Act, we have included measures that enhance the independence of investigations and improve openness and transparency and therefore trust in our military justice system.

Let me say how much I'm looking forward to working with our new Judge Advocate General, Brigadier-General Jerry Pitzul.

Now my fourth and final priority is the one that perhaps your committee is most familiar with. Like me, you are deeply concerned with the quality of life of the men and women of the Canadian Forces and their families. Your report, after your hearings and your deliberations, on quality of life issues will be a key part of the process to improve this situation. The members of the forces and the department look forward to the report and your recommendations.

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But as you proceed, we are not standing still. Action is being taken on a number of fronts. For example, under the Clothe the Soldier program, we are evaluating and procuring uniforms and equipment to suit the needs of forces personnel.

I might add that I was over at the Louis St. Laurent building in Hull the other day and was able to look quite extensively at the progress and redesign of a lot of the clothing and equipment that are carried by our personnel. Some of it is state of the art. These are among the best designs in the world, and they will be provided for our forces.

I would suggest, Mr. Chairman, that you and the members of the committee go over to the Louis St. Laurent building for that same kind of briefing and see the different pieces of clothing and the development of this Clothe the Soldier program. I think it's well worth while to get that understanding of it.

That's one example. We're proceeding on that. That's a quality of life issue.

We also established a senior officers review board on quality of life to provide strategic direction on human resource management.

We provided, with all these little pay increases and adjustments and closing the gap with the public service, a 9% increase over the last two years for non-commissioned members and general service officers—that's below the senior ranks. We also improved the environmental allowances for people who serve in places like Bosnia.

We also put in place an improved pay and benefits package for the reservists by giving them 85% of the regular pay category and providing for an allowance upon retirement for long service.

We put initiatives in place to help military spouses seek employment, including running workshops on job search techniques and providing financial assistance for the preparation of résumés.

All of these initiatives have been funded out of our current baseline. This hasn't been easy, as you can well imagine with the cuts we've had over the last few years, but we are trying to address these issues because we are starting to reap the benefits of becoming more efficient and effective and saving costs in other areas. We still have a long way to go, and we're going to need your help.

One way we'll have to continue to find money is through our alternate service delivery program. I know you've heard about this during your base visits. As I have said on numerous occasions, we have an obligation to meet budget reduction targets. This is the last year, I might add, of the program review targets that have to be met.

We also have an obligation, of course, to perform our services in an efficient and effective manner. That's what taxpayers expect of us. If we can do so and save taxpayers' money, we should. This is what we can do with the alternate service delivery program.

However, at the same time, this government has an obligation and a desire to make sure that our employees are treated in a fair and humane way. We have demonstrated that by the way we have gone about downsizing the public service, and we will demonstrate it again in terms of how we treat employees under the alternate service delivery program.

For example, the goal in our current review of site-support services at six bases is the development of a most-efficient organization, or MEO. So it's no longer just ASD, it's now MEOASD. I'm sorry to put all those initials on you, but a most-efficient organization is what we'll attempt to do first.

To that end, I recently directed the department to ensure that employees at the six sites have the opportunity—this is important—to demonstrate whether sufficient savings can be achieved through internal redesign of the work before a decision is made to pursue the competitive process through ASD. This could well involve going to the private sector for the services.

So first of all, MEO before ASD. I think that's good. I think it's fair. I think it's a sound business practice. ASD and MEO are about taking a close look at everything we do and choosing the most cost-effective and practical way to support the operations of the Canadian Forces.

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Mr. Chairman, we are meeting our commitments, whether nationally or internationally, and, I might add, we are more combat-capable today than we were just a few years ago. But getting there often requires us to make tough decisions. But as the Chief of the Defence Staff told you a few weeks ago, the modern military's effectiveness is based on four things: leadership, training, equipment, and the conditions of service. You have to get the mix right. But you also have to improve in each of these four areas and I believe we are doing that.

At the end of the day, the goal must be effective, professional, multi-purpose, combat-capable forces. This committee is playing an essential role in helping us to reach this goal. I know that the demands resulting from your base visits have been heavy, but I want to thank you for the work you're doing in studying the quality of life issues. I look forward to receiving your report.

I know many of the issues we are discussing today, and those we will discuss when you submit the report, are complex and challenging, but the government will examine this committee's view on quality of life issues in detail and will respond promptly. This report will not gather dust on some shelf. It is too important to the members of the Canadian Forces, too important to their families. They are counting on you to voice their concerns and they're counting on the government to respond appropriately.

[Translation]

In doing so, the government may have to examine funding issues and other changes to legislation and broad government policy directly related to quality of life initiatives for the Canadian Forces.

[English]

All of these issues must be examined, with your help, if we are to get it right for the Canadian Forces. Thank you very much, Mr. Chairman. I'm happy to take your questions.

The Chairman: Thank you very much.

We now go to question period. Ten-minute rounds, Mr. Benoit.

Mr. Leon E. Benoit (Lakeland, Ref.): Thank you, Mr. Chairman.

Good morning, Mr. Minister and gentlemen.

Mr. Arthur Eggleton: Afternoon.

Mr. Leon Benoit: Or afternoon. Yes, that's right. It's been a great day.

Mr. Minister, in the main estimates, part III, some of the issues, for example, an explanation of the Coyote program and TCCCs, are included in that. Then you have the Auditor General's report, which came out just a couple of weeks ago. And in the Auditor General's report, the Auditor General is very critical of the military in several areas—and I'm sure you're aware of what those areas are, Mr. Minister. But the one area that the Auditor General actually gave a fairly positive review to was the Coyote program. That was one of the areas that he pointed out as being on budget and on time. And yet I received a memo between a couple of generals, General Marleau and General Maisonneuve, in a brown envelope—one of those—and in this memo they are going back and forth saying that in fact the Coyote program could easily be shut down at any time at all in the not-too-distant future due to lack of maintenance, lack of parts, just the lack of capability of keeping these things going.

In fact, they start by saying that:

The attached powerpoint slides were extracted from ADM Mat's 16 Apr presentation to PMB. From the E-Mail correspondence outlined below, it would appear that the Land Staff have reviewed and accepted the impact of the NP funding shortfall and has the “endorsement of the Army”. To ensure that there is no misunderstanding on this matter I would like to elaborate on the impact on the Army of these funding decisions.

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And then this document goes on to say, Mr. Minister, that in fact if— We have the Prime Minister over in Bosnia today making an announcement of continued participation in the NATO program there, and these two generals, Mr. Minister, say that in fact the way funding has been cut they will not be able to keep the Coyotes and other equipment in a condition that will make it serviceable in that front. They're saying that very shortly down the road, unless something turns around very quickly, there will be such a problem they just won't be able to provide the equipment.

So we have the Prime Minister saying we're going to go ahead. We've had you in the past saying everything's all right. And yet we have these generals saying we have a serious problem and we may have to shut things down.

Mr. Minister, do you feel comfortable that our commitments, and the commitment the Prime Minister is reinforcing today, can be met, both for this term and over the next couple of years?

Mr. Arthur Eggleton: Last I heard the Prime Minister was in London today, not in Bosnia. And we don't use Coyotes in Bosnia. So you don't seem to know exactly what you're getting at here. I'll ask the ADM and—

Mr. Leon Benoit: It's not just that piece of equipment. They're talking about all of the equipment needed, and that's just—

Mr. Arthur Eggleton: We're not going to send people into Bosnia or anywhere else without assessing the equipment they're going to use and making sure that in fact it is going to be in good order and is going to serve their needs and help them to complete their mission.

Mr. Leon Benoit: But we have this memo from General Marleau saying that they just can't. And he refers to a powerpoint slide by the ADM.

Mr. Arthur Eggleton: I'm not sure about your interpretation of that. I'll ask Mr. Lagueux—

Mr. Leon Benoit: It's quite clear. I have the document here and I'd be happy to make a copy available later.

Mr. David Pratt (Nepean—Carleton, Lib.): On a point of order, if he's referring to the document, perhaps just as a matter of courtesy he could provide copies to other members of the committee.

Mr. Leon Benoit: And as a matter of courtesy I will, later. I'll have one for the committee tabled too. It isn't in French, so there may be some objection to that right now.

Mr. Arthur Eggleton: Are you ready for the answer?

Mr. Leon Benoit: Yes.

Mr. Arthur Eggleton: Mr. Lagueux.

Mr. Leon Benoit: Really, no, Mr. Minister, I'm looking for an answer from you. My question to you was, do you feel completely comfortable that the commitments that are made in fact can be met?

Mr. Arthur Eggleton: Yes. Now Mr. Lagueux will be able to expand on this for you.

Mr. Leon Benoit: But why do you think these generals in fact don't agree?

Mr. Arthur Eggleton: I don't know. I haven't talked with them. And you didn't give me the courtesy of giving me that in advance.

Mr. Leon Benoit: No, I did not.

Mr. Arthur Eggleton: There you go.

Mr. Leon Benoit: I assumed you would know, Mr. Minister, what's going on in the military, especially at the level of the generals.

Mr. Arthur Eggleton: I wasn't privy to any conversation between these two generals that you're alleging, but we'd be happy—are you interested in the information or not?

Mr. Leon Benoit: I am, but I'm looking—

Mr. Arthur Eggleton: Fine. Then let's get the information. Mr. Lagueux.

Mr. Leon Benoit: I'm looking for you, Mr. Minister, to answer some of these questions.

Mr. Arthur Eggleton: I gave you the direct answer on it. I gave you a one-word answer. I always thought you liked very pointed answers. So I've given you one. Now we'll fill in some of the details to help educate you, and Mr. Lagueux will help out on that.

Mr. Leon Benoit: I would really appreciate that, Mr. Minister.

Mr. Pierre L. Lagueux (Assistant Deputy Minister, Department of National Defence): Thank you, Minister. Indeed, the LAV-Recce, as the Auditor General has pointed out, has been a very successful vehicle in terms of its capabilities and has been recognized worldwide by several armies around the world in terms of its reconnaissance capabilities. It's a world-class vehicle produced here in Canada by General Motors.

I do not know the specific note to which you are referring, but there has been concern with the delivery of the vehicle with respect to the spares not being delivered at the same time as the vehicle. Since it's a new vehicle, newly produced, they are producing it off the line, and the spares are also being produced, so there's a question of timing. That is why the vehicle has not been fielded at this particular time until the spares are available to go with that vehicle.

Mr. Leon Benoit: Just to make it clear, I'm not only talking about that piece of equipment. In this document they say:

across all inventories of items managed by the DGLEPM (approx 300,000 line items), there is insufficient funding to reprovision in accordance with the requirements identified by the CFSS. The result is frequent and increasing “stock-outs” of items that we managed. The examples are numerous and increasing. Most recently the shortages we have encountered with combat clothing can be attributed to this problem. As the shortfall increases this will become more common across all areas such as clothing, combat and support vehicles and individual weapons support.

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And they go on later to say:

Without additional NP funding, equipment returned from Operation deployment will be placed in repairable reserve in an unserviceable condition. If this continues over the longer term ultimately there will be no equipment to deploy on future operations.

Mr. Arthur Eggleton: Is there anything else? Do you want to get it all read out now?

Mr. Leon Benoit: That's enough for now.

Mr. Arthur Eggleton: Well, thank you.

Mr. Leon Benoit: Mr. Minister—

Mr. Arthur Eggleton: So you're going to interrupt again.

I notice you put a lot of “ifs” in front of things. That's worth noting as well. Anyway, back to—

Mr. Leon Benoit: I'm not putting the “ifs” in there. This is in correspondence between the generals.

Mr. Arthur Eggleton: Well, yes, you're reading it and I'm responding to it. There are a lot of “ifs” in there.

Mr. Lagueux.

Mr. Pierre Lagueux: Thank you, Minister.

The army is recognizing that they do have several new pieces of equipment coming in, such as the LAV-Recce and new APCs. This new equipment of course places demands on the ongoing support as well as the old equipment. The army is looking very seriously at an equipment rationalization program to ensure that the funds we do have are spent on support for new equipment, such as the LAV-Recce. So there's no question that some prioritization of the needs to ensure that the most important equipment and the most important pieces of kit in fact are fully supported—

As the minister said, we do not—

Mr. Leon Benoit: As the committee has travelled to army, navy, and air force bases, we have heard story after story after story of the people servicing this equipment having to rob parts off another piece of equipment that's meant to be serviceable equipment. It takes at least double the labour and a lot of extra cost to have to rob parts off another item that's meant to be an item that's operational. Clearly there is a very serious problem in providing spare parts. What this document does is, I guess, explain why that's happening.

Mr. Pierre Lagueux: There is no shortage of spare parts for any operational equipment that is in Bosnia, for example. I was there personally myself a couple of weeks ago and spoke to the mechanics and to the people there, and they feel they're extremely well supported. That's what they told me, Mr. Benoit. There is no shortage of spare parts there. So we are doing everything that is required to ensure that any piece of operational kit that's in the field is fully supported.

Mr. Leon Benoit: What about in this country?

Mr. Pierre Lagueux: Well, I guess you can look to the ice storm, Mr. Benoit, and see the equipment we used then. We had no problems keeping the trucks on the road and supporting the soldiers.

Mr. Leon Benoit: So you're saying the equipment is all just fine and there's no problem with parts.

Mr. Pierre Lagueux: No, I'm not saying that, Mr. Benoit. I'm saying there's an issue of priorities in terms of how we apportion the money we do have and that we have an active capital program. We have various demands being placed on the budget, and certainly any armed force could do with more money.

Mr. Leon Benoit: On that note, in terms of the new capital program, the Auditor General says in fact the cost of repair and maintenance will be even higher on this new, more sophisticated equipment.

Mr. Pierre Lagueux: When you get new equipment, Mr. Benoit, often you get additional capability, and therefore one has to look at comparing capability to capability. If you're getting additional capability, in fact the cost per piece of equipment may be more, but then you need less equipment overall, so therefore that tends to balance out. You have to look at the big picture here, which the Auditor General I don't think looked at. He looked at pieces fleet by fleet.

Mr. Leon Benoit: Okay, if I could just get back—

The Chairman: Mr. Benoit, your time is up.

[Translation]

Ms. Venne.

Ms. Pierrette Venne (Saint-Bruno—Saint-Hubert, BQ): Good afternoon, Mr. Minister.

I would like to ask you to respond to the people who claim that you are very slick with your answers and that files are piling up, and apparently are even covered in cobwebs. Obviously, I'm just reporting what I've read in the Ottawa Citizen:

[English]

“Is the defence minister too slick?”

[Translation]

I'm just throwing out the question. I think you should be able to give us an answer.

On a more serious note, I would like you to tell us about the privatization of food services and other services. Could you tell us where you are with that, particularly in Long Point, where civilians and military staff are wondering about their future? When will they find out what's going to happen to them? Could you at least give us some idea so that they could maybe plan their year?

[English]

Mr. Arthur Eggleton: Well, first of all, on this whole question about slickness, was that intended to be a compliment or not? I don't know.

Ms. Pierrette Venne: I don't think so.

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Mr. Arthur Eggleton: I do note that in that particular piece they said there were a lot of cobwebs. Well I went to my office and I looked for the cobwebs and I couldn't find any. In fact I couldn't find any files that were collecting dust at all. I think we've moved a lot of files. I'll put up my record of ten months against anybody's in terms of what we've been able to move in that period of time. And we'll continue to move those things.

I think we have a good team of people. We have a new deputy minister, a new CDS, a new minister, a new team in many respects, together with some people who have been around a few years who have great experience. I think we're moving all the issues along.

If there's any issue you don't think we're moving— They didn't mention any in that particular article, but if there are any that you don't think we're moving, it would be a pleasure to respond to you on those.

I'll ask the VCDS to comment on the one specific base you mentioned.

Vice-Admiral G.L. Garnett (Vice Chief of the Defence Staff): I'm not aware of any— There could be some local ASD initiatives at Long Point I can get back to you about. Tomorrow we're having a meeting of the ASD steering committee, which includes members, representatives of UNDE and PIPS, national unions. In fact the V-P from the Montreal-Quebec area, based in Montreal, is a member of that steering committee, so he'll be here tomorrow, along with a variety of representatives of government departments, Treasury Board, Public Works, DND, and HR, to discuss ASD, as the minister has mentioned in his introductory remarks on new initiatives in ASD in relation to the workers having first the opportunity to produce what is called a most efficient organization. So that will be discussed tomorrow in a forum that does include the representative of those workers at Long Point.

If there's some other local initiative in relation to a cafeteria or something, I don't know the answer to that, but I can provide the information back to the committee.

Mr. Arthur Eggleton: As I said, our approach now is to put additional emphasis— We've always tried, of course, to do it through internal reorganization, but we want to put additional emphasis on doing that. If we can get the savings we need through internal reorganization or the MEO, the most efficient organization, we'll do that before we go to an ASD or with the possibility of it being farmed out.

[Translation]

Ms. Pierrette Venne: Basically, it's just a question of the timeframe. I was just asking this question so that the people there know what to expect. Anyone who thinks that some budget cuts may be coming up would maybe like to know about it at least a few months in advance. That's why I was asking my question. I do realize that studies are being done all over the place to determine the most cost-effective way of doing things. Everyone certainly agrees on that point.

Mr. Minister, you said that you didn't want our report on quality of life to gather dust on a shelf, and that you would do everything you could to make sure it was implemented. Have you planned any follow-up to our report and its implementation? Will the quality of life committee or council—I don't remember the exact name—in the Armed Forces be responsible for implementing and following up on our quality of life report?

[English]

Mr. Arthur Eggleton: I suspect they will do a lot of the following up. Of course the first step, once the report is received, will be for the government to make its response, as is the requirement, within 150 days of receiving the report of the committee. We will do that. Then that of course brings me into dialogue with my colleagues in the cabinet as well, where ultimately the decision is made. As soon as the government response has been filed, it will be my priority to see that it is implemented as quickly as possible.

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[Translation]

Ms. Pierrette Venne: Once again, we will want to do a follow-up, because as you know, the soldiers that we met are quite concerned that we're just another committee that's come by to talk with them and that the whole report will be shelved. I would like to reassure the soldiers and tell them that all this work will be put to use.

Lastly, I would like to know how the campaign to recruit women into the forces is coming along. It has a funny name. I can't remember it anymore. Does anyone remember?

[English]

Mr. Arthur Eggleton: Operation Minerva.

[Translation]

Ms. Pierrette Venne: That's it, Minerva. Could you tell me how that's coming along?

[English]

Mr. Arthur Eggleton: First, with respect to the quality of life study, in my first appearance before this committee I asked that the committee resume the quality of life study that had been started by the committee in the previous Parliament.

I asked the committee to add to that visits to different parts of the country to listen to forces personnel and their families. That is because I wanted the committee to hear, and I wanted the public to hear, many of the things that I've heard in travelling to bases and talking with personnel, spouses and their families.

Much of what I read now that arises from the presentations being made to your committee at these hearings are issues, concerns, and challenges that I have heard myself. But I think there needs to be a greater awareness on the part of the public and members of Parliament as to these needs and challenges faced by our personnel.

I have not been shy about my commitment to deal with quality of life issues. I consider this to be a very high priority. It's one of the four priorities I mentioned. I am very grateful for the work your committee is doing, and I'm looking forward to getting those recommendations and continuing to work with you and the government beyond that in implementing them.

During this particular year we have been attempting to recruit significantly more women into the combat roles. We've always had a lot of women fill positions in the Canadian Forces. In fact we are the second highest in the NATO countries. I think the number is about 14%.

The only country that is higher than Canada is the United States. But ironically, they bar women from some 20 different positions, combat role positions, by and large.

We only have one operational one in effect. That's submarines, and who knows, with the new submarines we may be able to change that. We'll certainly be looking at that. But it just wouldn't work in terms of the facilities that are provided and the very cramped quarters on our current submarines.

But through our recruitment this year we are attempting to get more women into combat roles. We've done a lot more advertising geared towards women. These are not just about the typical occupations they've occupied in the past in the forces—the desk jobs, etc.—but for many of the combat roles.

I don't know the results to this point in time, but I think that fairly soon we should be able to tell you how we are proceeding on that.

[Translation]

Ms. Pierrette Venne: Mr. Minister, could you send that to me?

Mr. Arthur Eggleton: Yes.

[English]

As soon as I get the information, I'd be happy to do that.

[Translation]

Ms. Pierrette Venne: Fine. Thank you.

[English]

The Chairman: Mr. Pratt.

Mr. David Pratt: Thank you, Mr. Chair.

Mr. Minister, as you know from the hearings we've held on the quality of life issue, touching concerns about housing, salary, equipment— I know you've followed that very closely in terms of getting reports on it.

The basic message we're getting back from all of this, of course, is that it's going to cost money. In some cases it's going to cost a lot of money.

We've heard that as well from General Baril and General Dallaire. I think General Dallaire's comments were that “it don't come cheap”.

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I guess one of the things that we've heard from members of the forces too is that there's a concern out there amongst the members of the forces that Canadians don't know what they do. Canadians don't have an appreciation for the role that the Canadian Armed Forces play in Canadian society and internationally in terms of peacekeeping operations, our international role, and defending our NATO allies, that sort of thing.

I must say that just recently I got some information like this booklet, “Canada's Defence Team in Action”. I think it is absolutely superb. I got another package recently in my office, which is very good.

But one of the things where we don't seem to be doing a very good job is focusing in on individual stories. We saw that with the Medak pocket, for instance. There are a lot of reasons for that historically, in the wake of the Somalia inquiry, and that sort of thing.

Can you give us an undertaking that some of the people in DND's public relations department will try to focus in on some of these individual stories, whether it's our SAR techs, who in some cases were doing a tremendous job— We heard from a fellow in Halifax, for instance, who was going to be awarded the highest medal for bravery. I haven't heard anything about that in the newspapers.

There are so many individual stories that you hear going from base to base about just extraordinary service on the part of individual men and women. Do you think there's room for improvement as far as the public relations aspect of DND is concerned?

To focus in on this a bit more, it seems to me at least—and I think some of my colleagues agree on this—that the only way we're going to be able to sell Canadians on a larger defence budget is to ensure that they understand what the role of the Canadian Forces is. Can you comment on that.

Mr. Arthur Eggleton: You're absolutely right. I think the ice storms, the floods in the Saguenay and the Red River, as tragic events as these were, did give people an opportunity to get to know Canadian troops, what they're capable of doing and how much they care about their fellow Canadians. But we need to find other ways of them getting to know that.

Last July 1 at the SkyDome in Toronto before a baseball game played between our two Canadian teams, the Expos and the Blue Jays, they honoured heroes of the Canadian Forces. Specific people with specific stories were introduced to a tremendous standing ovation in the stadium.

Those are the kinds of things we need to do a lot more of so they get to know the individual cases, as well as generally what they do in terms of helping out in natural disasters in Canada. There is the military award for the search and rescue technician you mentioned.

We also need to know more about what's happening in places like Bosnia, the kind of goodwill that is created by our forces, who not only patrol the areas and do the job that's expected of them under SFOR, but in their spare time volunteer to help fix up schools and playgrounds.

They get some money from CIDA to help them in terms of the equipment they need, the supplies. But they volunteer the labour, and as a result of that, they've created a lot of goodwill for Canada. So they're terrific ambassadors for our country. We need to hear more of those kinds of stories.

I really applaud your effort to have a day designated for the Canadian Forces. I would very much like to see the House of Commons and the Senate, the Parliament of Canada, express its desire to have that kind of recognition day.

Mr. David Pratt: Is there time for another question, Mr. Chairman?

The Chairman: Yes.

Mr. David Pratt: As an adjunct to the last question, one of the issues, as well, in a parliamentary government is building support among colleagues. We've had the opportunity to visit the bases to see the people operating the equipment, whether it's the ships, the tanks or the submarines.

I'm just wondering if you think it might be appropriate to have some of your cabinet colleagues out to some of the bases so that they can get a better appreciation. As a member of Parliament, I had never been to a Canadian Forces base before this latest series of hearings we're involved in. I had no idea what they were about.

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It's such an incredible eye-opener to talk to the people, to see them doing their job. Has any thought been given to that as far as building political support within the cabinet and the caucus and, for the matter, the entire Parliament?

Mr. Arthur Eggleton: Yes. I encourage it and we help to facilitate it. Members of cabinet have visited bases. A number of them have bases in their constituencies, because members of cabinet are also members of Parliament.

I keep hearing more and more stories, and from all parties in the House and Senate, that indicate they're becoming more and more familiar with what's happening. I would certainly do everything I can to facilitate it.

For further encouragement I'd be happy to write to them just to remind them of that every now and then. Sometimes, with busy schedules, they lose sight of the fact that there are these opportunities out there. There are so many other things to do, and it would be good to remind them every now and then. So I'm quite happy to undertake that.

Mr. David Pratt: Well, the summer might provide a good opportunity that way.

I have one final, quick question. Minister, we have the submarines out of the way, as far as the acquisition is concerned. One part of the helicopter program is coming along. Do you have anything to report on the other part of the helicopter program, in terms of the maritime helicopters?

Mr. Arthur Eggleton: Well, the defence white paper of 1994 indicated four major purchases. There are lots of others—they are not the only ones, by any means—but there are four major ones: search and rescue helicopters, which are now done; submarines, which are now done; and armoured personnel carriers, which are, by and large, done as well. We've ordered quite a number of them. The new version is starting to come off the line late this summer. So we're well under way in that program.

That leaves the maritime helicopter, the replacement of the Sea King. We're now developing our procurement strategy with respect to that. I'm quite mindful of the fact that they are over 30 years of age and their life cycle is up in 2005.

So we don't have a lot of time to move on that, and we are preparing for the procurement strategy on that.

Mr. David Pratt: Thank you.

The Chairman: Thank you very much.

Ms. Lill.

Ms. Wendy Lill (Dartmouth, NDP): Thank you.

Thank you, Mr. Minister, for visiting with us. I had the opportunity of being at the Halifax hearings last week, and I must say that I was absolutely appalled by some of those things I heard. I mean, we've all read about the atrocities in Maclean's, etc.

But just to go back to this concept of recognizing our peacekeepers, one of the people there was a peacekeeper who was in Bosnia for seven months sand-bagging contaminated material and PCBs. His health is now destroyed.

He's a very young man, he has a young family, and he'll have a chronic illness now for the rest of his life. In fact we have many young men who are no longer able to serve, and they are desperately trying to cobble together the rest of their lives.

As you know, a lot of them are not feeling that the military is there for them. They feel their pensions are not at all sufficient, and the military is not owning up to responsibilities for their medical conditions. I've heard that time and time again.

I've heard stories of people who believe they got HIV and hep C from transfusions in military hospitals. These are amazing kinds of things. They left me feeling terribly ashamed, because again, I saw these people as doing very valuable work.

We've given them work to do, we respect their abilities, and yet once they are no longer fighting machines, they seem to be thrown on the scrap heap. So I just wanted to leave you with that horrible image I got.

I also want to say that I can't stop getting calls from these people expecting things immediately from this committee. And that's not surprising. Many of them have been waiting for many years to try to get some kind of relief for their straitened circumstances.

So I would like to know if this is a possibility for the many cases coming before this committee that are of an emergency nature. We're not talking simply about clogged toilets, although that is certainly an emergency, but people who have major medical problems, pension problems. They need assistance immediately.

• 1625

Can there be some sort of commitment to dealing with their issues right away, and not simply waiting for a report in the fall? And then who knows how much further down the line any kind of real action on their cases could occur.

Mr. Arthur Eggleton: Absolutely. We're quite prepared to deal with individual cases at all times. I would be pleased to receive from you any particular information about any particular case and have it investigated.

Without commenting on any particular case, let me just say in general that I think we're probably a lot better off than we were a number of years ago, but we have still a long way to go from where we want to be.

In the course of your examination of these issues, we have commissioned two internal reports dealing with how we deal with people who are injured, or how we deal with people who are released for medical reasons. We've given them to your committee so that you can use the information as part of the recommendations you will provide to us.

But as I indicated in my opening remarks, we can't afford to stand still even in this interim period of time, and we will do whatever we can to make changes as we go, to continue the improvements beyond what we have already done.

We also want to make sure you're aware that we do understand and appreciate that there are shortcomings, as those two reports will indicate, and we want to address those issues.

Ms. Wendy Lill: I guess you know that I have some major concerns about alternative service delivery, especially about the wrong process. There is a letter with you now on the issue of the reverse order of merit.

You know that the base commander, a senior bureaucrat, and union officials have a great deal of difficulty with that process, the very negative impact it has had on morale, effectiveness, and efficiency within their operations at the Halifax base.

So again, I request an answer. When are these people, the many workers I see on a weekly basis, going to get their answer about the reverse order of merit process?

Mr. Arthur Eggleton: Actually I thought I had signed a letter and returned to you on that subject. I have looked at the information in some detail. The first round of determining reverse order of merit had shortcomings. We admitted that, and we entered into a second examination of how that was determined.

As near as I can make out, the second round of determination has been handled properly. I believe I've signed a letter to you to that effect, but if I haven't, I'll check when I get back to the office and get you that response as quickly as possible.

I was just told that it was faxed to your office today. I'm sorry.

Ms. Wendy Lill: Okay, I guess I'll wait.

The Chairman: Thank you very much.

Mr. Price.

Mr. David Price (Compton—Stanstead, PC): Thank you very much for being here, Mr. Minister.

I have several questions. One of them has to do with the fact that the prelude to the estimates states that Canada's first mission is to defend Canada and the second is to defend North America.

Now, defending North America means we have to work with the Americans, and as we know, the Americans are a nuclear power. The Minister of Foreign Affairs has asked the Standing Committee on Foreign Affairs to look at endorsing a plan to free the world of all nuclear weapons, world nuclear disarmament.

I don't know if you've discussed this at all with the foreign minister, but I was wondering if you could share the position of the Department of National Defence on this, whether they are for a nuclear-free—

Mr. Arthur Eggleton: Well, there's no such thing as a defence department position and a foreign affairs position. There's a Government of Canada position—

Mr. David Price: But you share back and forth.

Mr. Arthur Eggleton: Of course, we share back and forth. So what you have is a government position. As you know, the Government of Canada doesn't use nuclear weapons in its forces.

Mr. David Price: No, but you're put in an awkward position having to work with the Americans using them, if we decide the Canadian government is going to declare—

• 1630

Mr. Arthur Eggleton: We're also part of NATO, and it's also part of NATO provisions. In fact, the NATO charter and its provisions are under some review and will be under review over the next little while.

Of course, there are three new countries coming in as well, as you know. I take it your sister committee, the one on foreign affairs and international trade, is engaged in that subject matter.

Mr. David Price: Yes, that is what I was—

Mr. Arthur Eggleton: So I would think here again, just like the quality of life study, the government would wait until it hears the recommendations of the committee, and then a government position will be formulated. I can assure you that both the minister of foreign affairs and I will dialogue on the matter.

Mr. David Price: So that hasn't happened at this point.

Mr. Arthur Eggleton: No, that hasn't happened at this point.

Mr. David Price: Okay.

Personnel costs represent half the National Defence expenditures, and there are going to be less and less operational training, maintenance, and equipment purchases as personnel costs increase, especially if there are more pay increases. But the CDS has told us quite clearly that there are not going to be any tradeoffs.

In relation to that, have you put in a supplementary budget request for the pay parity for the reservists and for the pay increases in parity in the regular forces, as other ministers do when they have extra expenses?

Mr. Arthur Eggleton: As per previous agreements with the Treasury Board, the pay parity is being covered out of our own resources.

Mr. David Price: Out of defence.

Mr. Arthur Eggleton: Yes.

The economic increases, the other part of the pay increase—to get the terminology quite correct—are to be covered centrally, not just for defence but for all departments.

If there are additional provisions in terms of pay that this committee recommends as part of the quality of life, then, of course, we have to look at what specifically those provisions are. If they're quite extensive, then they would not likely be within the affordability of our budget. But we'll cross that bridge when we come to it.

Remember also, and this is something that is unique to the defence estimates, in the next fiscal year there will start to be a 1.5% increase in our annual estimates—given that we're $9.4 billion, you can calculate what that would be—that will start moving us back towards the $10 billion point. That increase, which is to offset inflation partially or completely, depending on the inflation rate at the time, is due to start as an add-on to the defence department budget in the next fiscal year.

Mr. David Price: That would be very minor compared to what the Auditor General had to say.

Mr. Arthur Eggleton: The Auditor General is particularly commenting on the capital end of it. The capital portion of the budget is down to about 15%. Ideally, we'd like it up to 20%, or perhaps a little more than that. It has been low once before, but it has also been quite a bit higher at one time. That's why I said earlier we have to look at this over a 10- or 15-year range, not just the single year.

Yes, 15% is low; we've absorbed initially a lot of the cuts as a result of the program review, the budget cuts over the 1994, 1995, and 1996 budgets in the capital budget. But as we gain efficiencies through operation maintenance, which is a little over 30% of our budget, through programs like alternative service delivery, then we'll be able to have additional funds available for capital purposes.

As I think I've also indicated publicly on previous occasions, we're going to look at some creative financing methods also and help get some of our capital purchases. We've already demonstrated that with the submarines, how we're going about purchasing the submarines. We also, of course, are much more these days into off-the-shelf purchases, as opposed to heavy military developmental programs that are much more costly.

There are various means. Of course, new technology coming along all the time saves a lot of money as well. So we will get the capital budget back up to meet our requirements and our essential obligations under the white paper.

• 1635

Mr. David Price: I certainly agree with the off-the-shelf. We've seen what has happened as far as new technology. Some of the things that were bought by the military several years back are not in full operation yet and they're already outdated.

You mentioned ASD. One of the things we heard yesterday at Trenton—when we first heard about the Trenton food services thing it seemed very positive. It had been an in-house bid and everything was going along nicely. But when we got on base and the reports started coming to us, then we heard that the base commander was having to help subsidize the food part of it for his Canadian Forces personnel, and there was even a little worry that the company could fold. And if it did fold they would have to take the next lowest bidder, who was somewhere in the area of $6 million above the DND operating costs of the food services there.

Have you looked into that and seen what we could do to be better prepared when we go for ASD? I won't even get into Goose Bay, which is a whole other situation.

Mr. Arthur Eggleton: I'm happy to answer questions on Goose Bay or anywhere else, but we have a thorough examination of all of the risks involved in these various contracts, and we want to make sure we provide a level of service. At one point I heard there was also a concern—you haven't mentioned it—about the pricing, that some people would have to pay a lot more for their food. That's not the case. For almost everybody it would be about the same, or maybe a little less, on a pay-as-you-go basis. The only difference would be that those people who like to go back for second or third helpings might find it a little more expensive, but for most people who don't do that it won't be more expensive at all.

In terms of the other matters you raised, do you have any information on the Trenton facility?

VAdm G.L. Garnett: I do know about the individuals. The instruction allowed for each individual to have the option of pay-as-you-go or paying the standard full monthly rate. That had not been implemented properly in Trenton, but has now been corrected. So the individual who complained that he was paying more is on a standard monthly rate, and that was always supposed to be an option. I'm not familiar with second bidders or—

Mr. Arthur Eggleton: Was Trenton an in-house? Was it an in-house bid that won it?

Mr. David Price: CF personnel are doing the cooking and civilians are doing the operating, so it was a—

Mr. Arthur Eggleton: As I recall—correct me if I'm wrong here—in this case it was an in-house bid that won.

Mr. David Price: Yes.

Mr. Arthur Eggleton: It's still employees who are operating—-

Mr. David Price: That's right. And that's why it was looked at as a positive, but then we heard all these little side things about it. But I still think it has a possibility—

Mr. Arthur Eggleton: If we still have the—I mean they can't go belly up if it's us. We're the department and they're part of the department. It's not an outside service. It's us.

Mr. David Price: Yes, but they were forced to go—if it's absolutely ASD and they can't supply the services for the money they have, then you have to go to the next bidder. Apparently that was in the contract.

Mr. Arthur Eggleton: I haven't heard—

Mr. David Price: But we're getting into details and that's not—

Mr. Arthur Eggleton: I'd be happy to look at it further, but as far as I know it's doing okay.

Mr. David Price: I'm looking at the long run and what's going to happen in the rest of the ASD.

Mr. Arthur Eggleton: There's an example. We've gone through 15 ASDs so far and six of them are in-house, they're internal. So our people have been doing pretty well. Also, I think one of them was an employee takeover. There's a difference between internal and employee takeover, and then there have been partnership arrangements and some that have gone outside. So it has been quite a mixture, and now with this additional emphasis on MEO we're going to see if we can do more of them in-house and get the savings there. But we've been—you mentioned Goose Bay. There's $20 million a year that we're going to save.

Mr. David Price: Okay.

The Chairman: Thank you, Mr. Price.

We now go to the five-minute round.

Mr. Benoit.

Mr. Leon Benoit: Thank you, Mr. Chairman.

Mr. Minister, on Monday the Prime Minister will announce in Bosnia the continued support for NATO operations. In the information that I've tabled before the committee I think we have clearly demonstrated that there will be some serious problems in terms of Canada providing what they need to meet that commitment.

Being in government is about setting priorities and being the Minister of Defence is about setting priorities based on the information you get from the defence department

• 1640

Through access to information we received some information on a conference in Winnipeg on July 29, 1997. I believe you were given an invitation, Mr. Minister. Over 300 people attended. It was the brainstorm of General DeQuetteville, who was commander of Air Command and chief of air staff at that time. Through the information we got—it took us nine and a half months and two attempts to get this information—it wasn't released until after DeQuetteville retired.

We found that this conference, which I understand was more of a retirement party, cost over $2 million. The information that we could glean showed $2 million.

Mr. Minister, how many generals are there in the forces right now?

Mr. Arthur Eggleton: Sixty-six, and that includes admirals.

Mr. Leon Benoit: If we have retirement parties like that for all of them it's going to cost a lot of money.

Through access to information we also got information on General DeQuetteville's expense account. We can't get all of the information. For example, there are 58 flights to places like Istanbul, Miami, Kuala Lumpur, Chile, Argentina, Venice, and so on where we can't determine what kind of flight the general took. But the documented costs that we could identify amounted to about $556,000 over a 28-month period.

The total figure would probably be closer to $1 million to $2 million. If you got each of the generals spending that kind of money on travel— With regard to priorities, do you think that is a reasonable balance?

All of the problems the committee has heard about, and you're aware of those— Meeting after meeting we've heard about serious problems with shortages of funds, and then this kind of information comes out showing that kind of waste and spending. Do you believe those are reasonable priorities that have been set?

You don't think that's a loaded question or anything, do you?

Mr. Arthur Eggleton: What a flight of fancy you were going on there.

First of all, let me start with what you refer to as the serious problems in meeting our commitments in Bosnia. We're in Bosnia until next month, and as for the government's decision with respect to what is beyond that, stay tuned. But there are no serious problems in meeting that commitment. We can meet that commitment.

Mr. Leon Benoit: But don't you think it's reasonable—

Mr. Arthur Eggleton: You've asked the question, so let me answer it.

If we are going to stay in Bosnia, we will continue to meet the commitments and obligations and we will ensure the best possible protection for our Canadian forces as they work in Bosnia.

With respect to this conference in Winnipeg in July 1997, it was a conference. There was some very useful dialogue and information, and as part of that there was a farewell—as I understand it; I wasn't there—for General DeQuetteville, who is the past head of Air Command.

Mr. Leon Benoit: What about the price tag?

Mr. Arthur Eggleton: To start taking that and talking about all those other trips—I'd be happy to get you more information about that. It could be that there are some that the others at this table might—

Mr. Leon Benoit: Could we get information on all the generals and their costs, their expense accounts?

Mr. Arthur Eggleton: Wait a minute now.

The Chairman: Mr. Benoit, let the minister answer.

Mr. Arthur Eggleton: First of all, you don't take their costs associated with the head of Air Command and then multiply it by the number of generals we have. The costs involved in his functioning in that office are quite different from generals or admirals in lower-ranking positions who don't have that command of the air force. We only have three heads of our services, and he was one of them, so obviously you don't do some simplistic multiplication times 66, as you're attempting to do.

Mr. Leon Benoit: Would you make that information available, Mr. Minister?

Mr. Arthur Eggleton: I told you I would make that information available. I told you that a moment ago. I'll give you whatever we've got here now, and whatever additional information we can give you about that conference, we will do that.

I don't know about all these other things. It sounds like a fishing expedition to me, but if you have any specifics—

Mr. Leon Benoit: We got the information through access to information. It's not a fishing expedition.

• 1645

Mr. Arthur Eggleton: If you have anything specific rather than just there's all these trips and you multiply by 66—

Mr. Leon Benoit: Could you release information on each of the generals on their expense accounts for the past few years?

Mr. Arthur Eggleton: You tell me what you're specifically looking for and we'll get you information on it.

Mr. Leon Benoit: You talked about a more open military, Mr. Minister. With all due respect—

Mr. Arthur Eggleton: It's much more open.

Mr. Leon Benoit: —you it said again and again. What is the problem with getting this information on the expense accounts? I think it's reasonable. The Canadian public is paying the salaries of these people.

Mr. Arthur Eggleton: We'd be happy to get you the information. We'd also be happy to get from you some constructive contribution to how we can improve the Canadian Forces, but maybe that's asking for too much.

Anyway, I'll ask my colleagues here at the table whether they have anything else on the conference in Winnipeg.

Okay, we'll provide you with that information as soon as possible.

Mr. Leon Benoit: Thank you.

The Chairman: Thank you, Mr. Benoit.

Mr. Proud.

Mr. George Proud (Hillsborough, Lib.): Thank you, Mr. Chairman.

Mr. Minister, I welcome you here today. I'm not going on a fishing expedition, but I do have some concerns, as you already know. When I look at the estimates and what has happened in the last number of years, I think the budget shouldn't be where it's going. During the review in 1994 I had wanted to set a certain standard, but of course that was overruled.

We looked at program review. We've gone through program review. In this particular case I think we've cut a lot. Since that time we've asked our military to go on many missions, and I think that's right. I think we should be involved in the NATO and UN operations and all of these other operations.

In going around the country the committee has heard that people like this. They don't mind doing it provided they have the equipment and the people.

I don't know what will be in the committee's report. I have a pretty good idea there's going to be a couple of things. One of them is that the Department of National Defence is going to need more money. The budget will have to go up. If you look at the public opinion polls, I think this is very positive.

I think the people feel that way. As Mr. Pratt said, as we make the public more knowledgeable about what our troops are doing, what their roles are, and the roles they play domestically and internationally, I think now is the time we can build on this.

I don't like to date myself, but I've been on this committee longer than anybody around this table. I've seen it with a budget of $12 billion and now I see it with one of $9 billion, and I don't like that. Mr. Minister, I think we have an opportunity now to see if we can get more money into this budget. We're not going to be able to do it all in one year, but I believe one of the recommendations of this committee will be that, because we need more people.

I believe firmly that we take part in these peacekeeping missions or whatever missions there are throughout the world with our combat-capable military. To do that we're going to need more money and more people. That's been loud and clear at the hearings I've been to, and I've sat in on a few of them.

I wanted to ask you another question when I heard you talking about alternative service delivery and the case of Goose Bay. You once said, and I want this on the record, that with the changes in Goose Bay, and today you mentioned the possibility of saving millions of dollars—with it easier for our NATO allies to take part in operations at this facility, does that make more jobs possible?

Mr. Arthur Eggleton: Thank you very much, and thank you for all of your years of strong support for the Canadian Forces.

I am no different from any other minister. Yes, I'd like more money for the Canadian Forces. I'd like more money in my budget. We all know that we went through the reduction exercise so that we could balance the books of the government and get rid of our deficit, and that has created some very positive changes in the economy in this country. We paid a pretty fair price for it in Defence, because even before the program review cuts started, cuts were being made by the previous government as well. So I don't mind telling you, I was happy when Defence didn't get mentioned in this year's budget. It's probably the first time in a decade, but it was also the first time we didn't get cut.

• 1650

It's not easy to deal with these cuts—23% in four years and 30% in our purchasing power—but we will manage.

Yes, we're going to need more money for certain things, but like any other minister, I don't think we're going to get it on just, “Give us an increase” or “Give us a percentage across the board”. We have to do it on a case-by-case basis, as I hope we can on the quality of life issues and as we were able to do in a smaller way in the ice storm. When it came to how the incremental costs were going to be absorbed and passed in the Saguenay and the Red River floods, we absorbed them into the departmental budget. I went to the Treasury Board and said, “We need the money for the ice storm, because otherwise it comes out of something else, and I don't think that's fair to the troops, to take it out of training or anything else.”

So we have to take it on a case-by-case basis for additional funds, and of course, as indicated earlier, we have to find more efficient and effective ways of doing our operation and maintenance. We have to use alternate service delivery, MEO, and other means to be able to make those efficiencies and bring about that streamlining.

Also, with changes in technology and the new way we carry on capital programs, we're finding in some areas that less manpower is necessary. Look at the submarines, for example. The new submarines will have a much smaller crew. The operating costs of the submarine will be substantially less. We're saving several millions of dollars in operating costs every year. The crew is now about 40, compared to 77, on the Oberon, and yet there are two decks. There's a lot more space there. And it's faster and quicker to dive. It has a lot of features that we don't have in the present submarine. So we're getting greater capability, less personnel, and better technology, all of which together means less costs to operate.

The Coyote was mentioned earlier. Now there's a world-class reconnaissance vehicle. There's one that is admired by the armed forces of other countries. And wait until you see the innovative stuff they're doing in the Clothe the Soldier program. You'll see we are able to come up with a number of innovations that are less costly and yet will give us some of the best equipment.

We're not going to get the best equipment in every area. There are some areas where we just can't, given the size of our military. We're not into attack helicopters, for example. We won't have every capability, but with the capabilities we do have, we can use a lot of innovation. Canadians have shown they can do that.

So as much as we'd all like to have more money, we'll have to do it on a case-by-case basis and use innovation and our ingenuity, efficiency, and effectiveness to accomplish it.

The Chairman: Thank you, Mr. Proud.

Mr. Arthur Eggleton: Oh, I forgot NATO.

The Chairman: Okay.

Mr. Arthur Eggleton: You see, one of the reasons we needed to go to ASD in Goose Bay is that the costs there are absorbed by our allies, not by us. I don't think much of anything is absorbed by us in Goose Bay. Most of it we charge off to our allies who use the facility as part of the low-level flying training.

Our allies were getting after us about our costs, saying they were too high. If we didn't stay competitive, we could have lost them and we would have lost the base. I know the change was hard for some people in Goose Bay, but the alternative was a lot worse. The alternative was we'd close the base.

But now that we're able to cut the costs to our allies and perhaps put in some new equipment as well, we have the opportunity to go in the other direction: to expand. I'm hopeful that because we're now more efficient in our operation there and we'll be able to provide better services, we'll get more use. More use means more revenue into the defence department budget to help meet some of our other needs.

• 1655

NATO flying training is also a good example where we can do that.

Mr. George Proud: Just talking about getting more money into your budget, I asked you one day at a briefing we had about sending these people to Central Africa. It costs the department of defence x number of dollars to send them there, and the country pays so much money to the Government of Canada. I asked you to give— Do you get that money back into your budget or does that go back to general revenue?

Mr. Arthur Eggleton: The money that comes from the United Nations?

Mr. George Proud: Yes, to pay for our people going there.

Mr. Arthur Eggleton: Does that go back into our budget?

A voice: CRF.

Mr. George Proud: That's what I was trying to head off.

Mr. Arthur Eggleton: I should tell you, though, that on the expense side of things, we get a special allowance from Treasury Board for those kinds of missions and for emergency situations such as the ice storm. When we go over that allowance, I go back to Treasury Board and get an additional amount of money. So we're not out of pocket for what we're spending in Central Africa. We have a special allowance for it.

But believe me, in all other cases, I will go to the Treasury Board and do my best to wrestle them on getting the money to come back into our accounts so we can use it for purchase of equipment.

Mr. George Proud: Thank you.

The Chairman: Mr. Benoit.

Mr. Leon Benoit: Thank you again, Mr. Chairman.

Mr. Minister, you mentioned the Clothe the Soldier program. I don't know whether this is part of the program or not, but again, in this document I've tabled, the comment is made—and this is one of the slides—that:

Free issue of new service women's dress cannot occur - new dress will be introduced once old stock depleted

- quality of life issue - if you are purchasing a new item of service dress, depending on your size, you may receive either the “old” unpopular item or the “new” preferred item.

That doesn't sound as though the Clothe the Soldier program is going all that well, Mr. Minister—that combined with what we've heard again and again, that in fact they've had to call in the personal combat equipment so the next tour over to the former Yugoslavia can be properly equipped. These things together seem to me to make it fairly hard for you to say things are going all right with that program. I'd just like you maybe to comment on that.

Mr. Arthur Eggleton: Well, things are going right with the Clothe the Soldier program. First of all, there is a difference from the standard combat clothing and some of the concerns that have been raised there, and I'll comment on those in a minute.

But let me talk about Clothe the Soldier, because Clothe the Soldier really is dealing with updating a lot of the uniform—not only the uniform, but the kit, other things they carry with them as standard equipment, or in some cases, environmental clothing in certain theatres of operation, such as Bosnia.

What you just read there and said it doesn't look as though it's going all that well— Remember, we can't do these things overnight. They take some time. There's a lot of design and engineering going into this. One of the things they're insistent on doing is, they're not just making decisions in some committee in the St. Laurent Building; they're going out and asking the troops, and asking the troops to test these. In fact they've sent out to them a lot of different options: test this hat, test this vest, test this, test that. And they're getting a lot of feedback.

Gradually these things are being decided and the orders are being put in. So it's not happening all overnight, but within the next couple of years we'll see some very substantial changes in the clothing. There are new helmets. In fact the armies of other countries are looking at our helmets. They think they're pretty good. There are so many other parts—new vests, new coats, new this, new that—that are much better designed, in a contemporary fashion using contemporary materials, than the old clothing, a lot of which was designed back in the 1960s.

No, I'm not finished, not finished, not finished.

Mr. Leon Benoit: But what they're referring to here is the women's dress, and that sounds like uniforms. It sounds to me like it would probably be covered under the Clothe the Soldier program. You really can't expect to get the new clothing.

• 1700

Mr. Arthur Eggleton: I'll ask the ADM Materiel to respond further on the women's clothing.

Mr. Pierre Lagueux: Thank you, Minister.

The Clothe the Soldier program—and the minister has offered to come to the Louis St. Laurent Building and look at that—is focused on equipping the soldier in the field with the equipment he or she needs to operate in the field. A servicewoman's dress is not something normally worn in the field by the soldiers, I'm sure you'll understand.

Mr. Leon Benoit: The combat equipment, then, which has been talked about a lot, seems to be awfully limited for new tours going over to Bosnia. That would be covered by the Clothe the Soldier program.

Mr. Pierre Lagueux: That is correct, in that the Clothe the Soldier program is focused on that in terms of the combat gear and the additional equipment—vests and so on—

Mr. Leon Benoit: Is $500 million what's being spent on that? And the program was announced two years ago or something?

Mr. Pierre Lagueux: I don't believe $500 million is the total cost of it. I can't, off the top of my head—

Mr. Leon Benoit: I think it was announced June of 1996, if I'm not mistaken.

Mr. Pierre Lagueux: That's the total program, and there are several phases to it, because there are several pieces of equipment. There's hot weather clothing, there's arctic gear, there's protection equipment, and so on.

The idea behind the Clothe the Soldier program is that for the first time we're looking at the solider as a system. In the past, the pieces of kit were bought as requirements came up, and quite often we had difficulty in putting all the different pieces of kit together. A helmet with a different frag vest, with a different piece of kit—quite often these things didn't fit very well together, and that's what we're looking at now.

Mr. Leon Benoit: How much of the $500 million has been spent so far?

Mr. Pierre Lagueux: First of all, Mr. Benoit, I'm not sure that $500 million is an accurate figure. I'll have to check that, to get back to you on that, but to my memory, it doesn't seem to me to be the right figure. I'll have to get back to you again on how much we've spent to date.

As the minister has said, Mr. Benoit, we are being careful to ensure that every piece of equipment we buy is thoroughly tested by the soldiers in the field and that we get their full feedback and comments on that, to make sure that when we do introduce it into the field, it is soldier-tested and meets the requirement and fits together.

Mr. Leon Benoit: What would be a normal time period from the time a program—Clothe the Soldier, specifically—is announced to the time it could be seen to be doing the job it was intended to do?

Mr. Pierre Lagueux: It certainly depends what you're buying. As I said, there are several different pieces of kit. If you're going to buy a piece of kit off the shelf that exists, a common commercial piece of kit, then you can do that very quickly. If you're looking at something that is a little more complex and that you want to fit altogether as part of a system, then you want to do some tests, some trials, and that will take longer. Certainly it would vary for the different pieces of equipment.

In many cases we are told, for example, “Why don't you just go buy a parka off the shelf, maybe get it in a different colour, and put it on your soldiers?” For a lot of this type of gear, the commercial gear is for the weekend hiker or skier. It's not meant to be worn, for example, as it is by the soldiers who wear it when they're in the field 24 hours a day, 7 days a week. It doesn't stand up to that type of wear and so on, so we want to do tests. We want to ensure that perhaps the textiles are good.

Mr. Leon Benoit: Okay. Thank you for your answer.

Mr. Minister, back to the 66 generals left in the Canadian military.

Mr. Arthur Eggleton: I haven't finished my answer about the—

Mr. Leon Benoit: What kind of—

Mr. Arthur Eggleton: —combat clothing that you referred to.

Mr. Leon Benoit: I'm satisfied with that for now, Mr. Minister.

Mr. Arthur Eggleton: I'm not satisfied, because I haven't given the answer yet, and I'd like to be able to give the answer.

He keeps wanting to ask questions before he gets answers.

The Chairman: Okay, Mr. Benoit. Shall we let the minister answer?

Mr. Leon Benoit: I only have five minutes, though.

Mr. Arthur Eggleton: You talked about shortages of clothing, and there have been some shortages of clothing in terms of standard combat uniforms—some of the sizes of boots and shirts and pants. By the way, those basic things we never ask anybody to return or leave behind. Those are basic, standard combats. They're worn here in this country every day.

We had at least one of the suppliers go bankrupt, so there was a shortage for a while. Also, there has been a substantial increase in use of these standard combat uniforms because the army decided to no longer use the garrison uniform. They felt, in fact, they could do with and save costs using the standard combats on a day-to-day basis, and of course the dress wear at other times.

However, we've let more than $8 million of contracts this year to make up for that shortfall in some sizes and supplies. We've moved some of the supplies around, better managed them, and that problem is very quickly coming to an end. But that's not at all related to the Clothe the Soldier project, which has to do with different design of new equipment to be used in the field.

• 1705

Mr. Leon Benoit: We have our concerns about both. So I don't really care about the technicalities—

Mr. Arthur Eggleton: That's why I wanted to answer it, because you asked it.

Mr. Leon Benoit: In regard to these 66 generals, who keeps track of their personal expenditures? There must be some monitoring.

Mr. Arthur Eggleton: Oh, of course.

Mr. Leon Benoit: When you hear the kinds of figures we've found here, I'm certainly concerned about the monitoring.

Mr. Arthur Eggleton: Which figures are you concerned about?

Mr. Leon Benoit: The ones I've presented to you already.

Mr. Arthur Eggleton: Are you going to give them to me in writing? I just heard you loosely referring to them. If you'd give them to me—

Mr. Leon Benoit: We received them through access to information, Mr. Minister—

Mr. Arthur Eggleton: Good.

Mr. Leon Benoit: —so I think you should have access to them. I would hope your department isn't keeping you in the dark.

Mr. Arthur Eggleton: Absolutely, but I want to make sure we're talking about the same figures you are. So if you give me those figures, we'll get you back an answer.

The Chairman: Thank you very much, Mr. Benoit.

Mr. Leon Benoit: Thank you.

The Chairman: Mr. Clouthier.

Mr. Hec Clouthier (Renfrew—Nipissing—Pembroke, Lib.): Thank you very much, Mr. Chairman.

Mr. Minister, if you were pleased the way the budget unfolded this year in February, I was absolutely ecstatic, because for the first time in many years and many budgets, the funding was not slashed to the defence department. I believe a lot of that credit goes to yourself and to the committee who have realized that our military need and would like to get more funding.

I come from the field of business. I don't believe anyone around this table would say we don't want more funding for our military. It's a very important part of the Canadian fabric, and certainly we want more money. But there's also the reality of the situation.

When Mr. Proud asked you about the funding that NATO gives to the Government of Canada and he asked where did it go, apparently it went into the general revenue fund. Perhaps we could borrow the fishing rod that Mr. Benoit uses on occasion when he goes fishing and try to catch that money and bring it back to the DND budget before it gets away on us, because we need that money.

I'm sure, Mr. Minister, we would be solidly behind you in any effort whatsoever to make sure the funding that is raised by DND, be it in lumber sales—and I have often cut wood on the military base at Petawawa and I believe it is absolutely atrocious that somehow that money is going into the general revenue fund. How are we suppose to be doing the upgrading in the military when we're losing that money?

One of the reasons that ASD has apparently been implemented is to save money, become more efficient. I'm very interested to know, Mr. Minister—and perhaps you or one of your colleagues could explain to me a bit about this new acronym, MEO, which is most efficient organization, because I believe you did say this would try to be implemented before we go to the actual ASD.

As you know, in regard to the base in my riding, CFB Petawawa, my preference is that ASD not come. As I've clearly indicated to the workers there, saying, “Listen, we have to become more efficient; we have to become more cost-conscious or else it could come”, my preference is that it not come. But I would like either you, Mr. Minister, or one of your colleagues to extrapolate a bit or elucidate on this MEO and the timeframing of it, how long it would be before it would be implemented, how much of an opportunity you would give for it before you would actually go the ASD, or is there a cost figure percentage that you would want to save on each and every base before you would actually turn to the ASD?

Mr. Arthur Eggleton: MEO, which stands for most efficient organization, I think actually started with the air force. They started to use that phrase in part of their efforts to streamline and cut costs and become more efficient. So we're sort of borrowing it for all of our services and all of our operations.

First of all, any time we engage upon any of these exercises, MEO or ASD, we start with full consultation with the unions, with the employees involved, with all of the stakeholders. What we will do in our studies in that process, as it weaves along, is determine where we think we can make savings, how much savings we think we can make.

Then what we would do in an ASD context is say, “Okay, bid”. We could have in-house bids; we could have employee takeover bids; we could have partnership bids with the private sector or complete private sector. What I'm saying now is I want to make sure we give the chance to do this inside through an MEO, a most efficient organization. Let's see if we can get almost all those savings internally, and then continue to operate the department as part of the forces.

• 1710

If after all these consultations we find we can't get enough of those savings or we can get a lot more by going to ASD, we're going to go to ASD. First we'll see if we can do it internally. Indeed, in some of the ASDs, in 6 of the 15 I mentioned, the staff proved they could do it internally. In other cases we've decided not to proceed with ASD because when we did our studies, we didn't think we would save enough to bother putting everybody through that kind of a procedure.

That's what we're going to look at. I can't give you an overall percentage. It's MEO—

The Chairman: Could you hang on for just a minute?

Mr. Arthur Eggleton: Yes.

The Chairman: Mr. Benoit, if you want to hold a press conference, could you hold it outside the room, please. We're trying to listen to the minister. Thank you.

Mr. Leon Benoit: I'm sorry, Mr. Chairman.

The Chairman: I'm sorry, Mr. Minister, please go ahead.

Mr. Arthur Eggleton: I'm sorry to interrupt your press conference. You don't mind, do you?

With an MEO, the idea is to try to do it internally before going to an ASD. That we will have to determine on a case-by-case basis as we go through the process.

I want to do it properly, but I want to do it expeditiously because we need the savings. We need to be able to take the savings from more efficient operation and use it to buy the equipment our people need, to provide the training they need, to make sure we can meet our commitments in places such as Bosnia.

Mr. Hec Clouthier: Mr. Chair, it's going to be shorter than short, because the next question was going to be to help Mr. Benoit. It was a very important question, I believe. He was going to be interested, but he has left the room.

Thank you very much, Mr. Chair.

The Chairman: Mr. Price.

Mr. David Price: Thank you, Mr. Chairman.

Mr. Minister, when we were down in Clearwater, we actually had a chance to visit the Sea King maintenance bays, as I call them. I was totally taken when I saw how much they did on a very positive side. They really tear these things down and take them apart.

I was bothered by a couple of things we heard there. We were talking about 30 to 40 hours per hour of operations; that was the number of hours required for maintenance. They told us there it was 70 hours. They take into account replacing the structures that are cracking and the supports for the motor, and that's a rather major job because they have to peel the skin back and so on. It bothered me a lot. It means the helicopters are taking an average of 70 hours for every one hour of work. As Hec was saying, as a businessman I look at it and ask whether we really shouldn't be moving things a little faster, because the costs are going way up.

Another part that also bothered me is the engines on them. There are two engines on the Sea Kings. If one fails, they can get back slowly but are going down all the time. It's that type of situation, very touchy. They have ordered new engines, which are a little more powerful, enough that if one engine fails they can get back with the one engine. The problem is that these new engines that were ordered are still sitting on the shelf; they can't use them because they have some defects.

I feel we're throwing money away. If we start today—we don't seem to have started yet—heading toward the new helicopters, there will still be several years down the road before they can go on line. These guys are working really hard, and they're doing a super job to keep things together. We haven't had too many accidents to date, but it's a very worrisome thing. It's worrisome for them. I talked to several of the pilots who are very nervous about flying these Sea Kings.

Mr. Arthur Eggleton: I agree, we want to replace them as quickly as possible, and that's why we're headlong into the development of a procurement strategy.

• 1715

We won't put up a Sea King unless it's safe to put it up, but you're quite right, the older they get the more maintenance they require, the more attention they're going to need. I've been down there and had a look at them as well. We're anxious to see it move as quickly as possible, and some of the announcements we've made this year involved the replacement of older equipment. We've done two of them, and this is another one to come.

Now, on any of those specifics— Mr. Lagueux.

Mr. Pierre Lagueux: Thank you, Minister.

I believe the figures that were quoted, which I think you've alluded to, also include modifications that have already been done to the helicopter. In fact, I think a modification to the existing engine is being done at the moment. It's an upgrading of that engine, which was—

Mr. David Price: They said they can't get any new engines. This is a new engine build by GE, I believe.

Mr. Pierre Lagueux: It's a modification to that engine the U.S. navy put in. We're putting it in now, as well.

I was not aware of the problem you referred to.

Mr. David Price: They had several sitting on the rack. They said they couldn't use them. They'd been told to keep them there for now, because there was a problem.

Mr. Pierre Lagueux: I'm not aware of that, but I will check into it when I get back.

Mr. David Price: David was there and Hec was there too.

Mr. Pierre Lagueux: No, I'm just not aware of it, so I will verify it to see what the problem is. I was not aware of its being a problem.

I'm aware of the modification program to the engine, but I'm not aware there was a problem with it.

Mr. David Price: No, it's just that all this money is going out. It's a business.

I think it was last fall it was mentioned that you had sent a letter to Senator Forrestall saying there was a group in place to start the planning for the procurement of these helicopters. There's still no movement at all on it. It's been—

Mr. Arthur Eggleton: There is movement. It just hasn't become public yet. I first of all—

Mr. David Price: Okay. Can you tell me they are actually working on it?

Mr. Arthur Eggleton: Oh yes. I can tell you we're working on it. I'm personally working on it. I've asked questions frequently about where we are in the process, and I've asked that this process be moved along.

It is moving along. As I said a few moments ago, we also have to be innovative and creative in how we go about doing these things, so we're looking at a number of different options on going about this.

As soon as we're ready to go, I have to go to the cabinet. Major capital purchases for Defence go to the cabinet, but as quickly as we can get it out as public information and make you aware of what our procurement strategy is, the better it will be.

Mr. David Price: I realize a lot of us are leasing vehicles these day.

Mr. Arthur Eggleton: Oh yes. I'm happy to look at that.

Mr. David Price: Thank you.

The Chairman: Mr. O'Reilly.

Mr. John O'Reilly (Victoria—Haliburton, Lib.): Thank you very much, Mr. Chairman.

Welcome, Mr. Minister, and thank you for coming again and supplying some very valuable information.

I have basically three questions.

In some of your talks, was there a time period for the replacement of the 30-year-old Hercules? At least I think they're 30 years old.

On the quality of life, did you indicate you've implemented a senior officers' review board? How is it working if you have?

You indicated this is the last year for program review. Is that the 1998 calendar year or the fiscal year? Will it also be the end of the ASD program?

Those are my three questions.

Mr. Arthur Eggleton: Taking them in reverse order, yes, this is the last year for the program review cuts. It doesn't mean it's the last year for cost savings in different areas and the transfer of money into other areas, but it's the last year we will have cuts in the budget overall as per current government plans.

As Mr. Clouthier mentioned earlier, as much as I'd like to take credit, it was actually promised in the election campaign that the cuts were over for all departments, not just Defence.

The ASD, no, that will take longer. In fact, we have an obligation always to look at efficiencies within our department. Remember, a lot of the program review cuts we've taken, including the final instalment this year, are coming off capital. Our capital is coming down to about 15%. That is low. We've got to get back up again. One of the ways I'll get it back up is to find further efficiencies in operations and maintenance. It's difficult to find further efficiencies in personnel, given that we're trying to give them pay increases. The efficiencies we're still going to need will be defined through MEO and ASD kinds of endeavours. That will go beyond this year.

• 1720

The senior officers' review for quality of life comes under the jurisdiction of the assistant deputy minister of personnel. He and his committee have looked at a number of quality of life issues, because there are a lot of things that can be done. Aside from those you're looking at, a lot of little things can be done internally. As I said earlier, we don't want to stand still during this period of time.

I want to make sure that anything they do, they tell you about it.

When General Dallaire, the ADM of Personnel, was here, he mentioned a five-point program. Here we're talking about five pillars, five categories within which all the programs for quality of life would operate. All of that information you should have. Of course we've still got a lot of stuff to fill in under each of those five pillars, which is part of what you're doing.

All of that information will be provided to you on an ongoing basis, so that you can incorporate it, understand what's being done, and understand how they can play a role in implementing what you recommend from the quality of life study.

With respect to the Hercules, one of the things about the Hercules I like is that they were bought at different periods of time. Yes, I think there might be some that are 30 years old, but there are also some that are only 4 or 5 years old. That makes life a lot easier than it does with the Sea Kings, where you've got everything coming up to 30 years of age at about the same time.

That's one thing I like about the Herc. At least I think it's the way we did it with the Herc. I'm not confusing it with the Aurora.

Can you comment further on the 30-year-old Hercs?

Mr. Pierre Lagueux: Yes, Minister.

We do have different ages of Hercs, as the minister has said. We bought two new stretch Hercs, a little bigger Hercs, a couple of years ago. Before that, about five or six years ago, we bought five new Hercs, which we converted into the tanker to provide us with a tanking capability. We do have some newer ones in the inventory. They're not all 30 years old, although there are probably some of that vintage.

At the moment we have an avionics update program on the Hercs, to bring all the Hercs up to the same standard of cockpit, with new avionics in the cockpit to modernize them and extend the life of the fleet. We also have an extensive structural program to ensure the structural integrity of the fleet.

The air force is looking to the future to replace the Herc. The C-130J is one— the J model is a new model that Lockheed currently produces. It's being looked at by countries such as Australia and Britain, although there are problems with it. The program is late. We will be looking at it, but at the moment our approach is to modernize, standardize, and extend the life of the fleet through a modern avionics program.

We of course have some newer ones in the fleet as well.

Mr. John O'Reilly: Thank you.

The Chairman: Thank you very much.

Ms. Lill.

Ms. Wendy Lill: Thank you.

I am not familiar with the questioning order in this committee. It's different from that in some others.

Mr. David Pratt: It favours the opposition.

Ms. Wendy Lill: Oh, okay.

I feel a bit handicapped in that I haven't received your letter regarding the ROMs—

Mr. Arthur Eggleton: I'm sorry about that.

Ms. Wendy Lill: —and I'm hoping you're not simply going to say the second ROM straightened things away, because obviously it didn't straighten it away with the people involved in the first ROM. I know there have been grievances around the second ROM as well.

I guess I will wait for the letter, and I must say that you can be sure it's not going to go away if it's simply that kind of a response.

Mr. Arthur Eggleton: I'll tell you what. If you're not satisfied with the letter, I'd be happy to sit down with you and bring an official or two with me and we can talk about it further.

Ms. Wendy Lill: Great.

Mr. Arthur Eggleton: I know you're trying to do what you feel is best for the people down there, and certainly in your letter to me you've written quite extensively about the matter. I want to make sure that I do my best to give you— It may not be an answer you can agree with at the end of the day, but I want to try to deal with it as best we can.

Ms. Wendy Lill: That's great.

I have one other question, and it's around ASD and the whole business of downsizing. I want to ask you a question around quality of life.

With ASD we are seeing privatization of many of the jobs, and with that goes a reduction in the salaries. We know that. We can look at Goose Bay. We can see jobs that were $15 an hour down to $7.50 an hour. So there are a couple of questions there.

• 1725

There are cost savings to DND on this, there's no doubt about it. The budgets are going way down. But what about the cost to the communities, and whose responsibility, really, is that? Do you think about that kind of thing? What is the impact on the morale of large numbers of people who see their family-supporting jobs going down in pay scale and loss of security? Suddenly, instead of working for the Department of National Defence, they are working for, say in Goose Bay, a British consortium. Do we have concerns about these kinds of operations being run by companies from multinationals? Are those concerns of yours? I'd be interested in knowing that.

Mr. Arthur Eggleton: We spent a considerable time looking at the Goose Bay situation. Yes, we look at things like cost to community, but it's very difficult when you have 23% less money, 30% less purchasing, and your capital budget is down and you have to make sure you get equipment so these people can safely carry out their responsibilities. You still have to deal with the fact that you have to work it within the money you have.

And yes, we just saved the base in North Bay. The community first came forward and said, “Look, keep the base here. There are all these pluses to it in terms of jobs in the community, economic development in the community, amongst other things, amongst quality of life issues, etc., in the community.” I said, “Yes, but I still have to meet this budget I have.” So we were able to, fortunately, come up with a win-win solution, something that is a winner for the community and at the same time trims $300 million over 20 years in our cost. Yes, we do pay attention to it, but we really also have to live within the means we have.

In the case of Goose Bay, I was concerned when some of those offers and projected salaries were coming in far below what these people had earned, and we did in fact put a supplementary package into place with the permission of the Treasury Board to bring them up to a situation where nobody would have less than 80% of what they got before in a similar job. There were some jobs that went from being full-time to part-time. We couldn't assure that, but in terms of the full-time jobs, it was 80%.

One of the things they'd had, you see, at Goose Bay was a special allowance. When Goose Bay was set up, there wasn't anything there. The base created the community, so there was an allowance given for being in a remote location, and the civilians went on to get that allowance. The civilians there today live in the community and they're going to get an allowance for being in an isolated location. On top of that, they actually got money every year for transportation to go to civilization, so to speak, even though they lived in the community.

So it was kind of difficult at the end of the day. Obviously the private sector firm wasn't going to give them those kinds of things, so we did put a special cost allowance in to bring it up. I think the lessons learned there are quite instructive in terms of how we'll proceed in other ASDs.

No, we don't rule out multinationals. They have to live within the law of Canada. Most of them employ Canadians. In fact, in the case of Serco, the company at Goose Bay, it is required that 75% or 80% of their employees have to be from the previous employees who did the work for us. Their manager is a local one, so not withstanding that they're multinational. Remember also, so are some of the users. The Brits are there as well in terms of being one of the users at Goose Bay. Most of the other ASD companies we have in Canada are Canadian companies.

So that's the story on that. We have to continue to be as efficient and effective as we can, because unless we can get additional moneys on a case-by-case basis, we have to live within our means and yet do the job we are tasked by the white paper to do.

The Chairman: Thank you very much.

The last question goes to Mr. Pratt.

Mr. David Pratt: Thank you, Mr. Chair, for your indulgence.

• 1730

When we were in Halifax there was a story that appeared in the Chronicle-Herald the day after we left. I'm presuming it was a result of the hearings. The headline was “Military soliciting `offensive”' and the story was about Senator Forrestall making some comments with respect to some work that's being done by the Canadian Forces personnel support agency.

When we were there, one of the things we heard was that Rear Admiral Dusty Miller was actively working within the community in terms of getting sponsors, which I thought was a great idea, to offset some of the cost being faced by members of the forces. Obviously, in terms of improving their situation, you could either reduce their costs, increase their salaries, or maybe do a combination of both.

One of the things that I came across was, for instance, a phone card for members of the navy. Actually this particular phone card was for the HMCS Toronto. It has a $36 value, but it sells for a lot less than the face value of $36.

The bottom line, from my perspective at least, is that what Admiral Miller is doing out there is incredibly innovative. There's a lot of purchasing power in the Canadian Armed Forces. If we can get corporate sponsors, like MT&T in this particular case, there are a lot of benefits for individual forces members. I'll pass this card to you, Minister, so you can have a look at it.

Mr. Arthur Eggleton: I take it that it has the HMCS Toronto on it.

Mr. David Pratt: It is in fact the HMCS Toronto.

Are the forces looking at doing that on a more widespread basis? I think it's an excellent opportunity again to involve the business community, to involve the public, and to support the men and women of the Canadian Forces.

Mr. Arthur Eggleton: I'm all for these things. I think this is terrific.

In regard to the article the other day about that, this particular committee, which is actually a committee of the forces, tries to find sponsorship, for example, for the Snowbirds. All of the militaries in the world do this, things that are not out of public funds but are part of the way of creating greater knowledge, awareness, and appreciation of our military, whether it's Snowbirds or Tattoos or whatever. These are things for which, yes, we go after sponsors. We traditionally do that. Other militaries, our allies, the United States, the British, and everybody, they do it as well.

There are limits on these things. You obviously don't put advertising on the helmets or something like that.

These are great ideas.

Also, they like their Tim Hortons coffee on the HMCS Toronto, so I took them a bunch of coffee while I was over there. They kindly contributed as well.

So, yes, we look at all sorts of means of these things. I think they're nice gestures. I think an opportunity to phone home is great.

The Chairman: Mr. Price, you have a 10-second comment?

Mr. David Price: Yes. I was just wondering if you put money in the budget for the new submarines coming from the British to change the steering wheel from the one side to the other.

Voices: Oh, oh!

Mr. Arthur Eggleton: Thank you very much.

The Chairman: Mr. Minister, I want to thank you again for coming before us this afternoon. It is always so interesting when you come. Usually I have to coax some of the members for questions, but when you come there just doesn't seem to be enough time. Thank you again.

The meeting is adjourned.