Defence procurement strategy
Improving Defence procurement
The Defence procurement strategy is based on a whole-of-government approach to defence procurement through the application of early and continuous engagement, timely and effective decision-making to guide and co-ordinate defence and major military procurements while fulfilling the Government's commitment to better ensure that purchases of defence equipment create economic opportunities for Canadians.
The Strategy has three key objectives: delivering the right equipment to the Canadian Armed Forces and the Canadian Coast Guard in a timely manner; leveraging our purchases of defence equipment to create jobs and economic growth in Canada; and streamlining defence procurement processes.
The Strategy is informed by the Government's extensive engagement with the industry and by the recommendations found in the Tom Jenkins report (also called Canada First: Leveraging Defence Procurement Through Key Industrial Capabilities) and David Emerson report (also called Aerospace Review) commissioned by the Government of Canada.
Delivering the right equipment to the Canadian Armed Forces and the Canadian Coast Guard in a timely manner
- Ensuring early and continuous industry and client engagement in the procurement process;
- Publishing an Investment Plan that outlines National Defence procurement priorities; and
- Establishing within National Defence an Independent Review Panel for Defence Acquisition.
Leveraging our purchases of defence equipment to create jobs and economic growth in Canada
- Using a weighted and rated Value Proposition, to assess bids for defence and major Canadian Coast Guard procurements. A guide is available to help develop value propositions;
- Implementing an export strategy to support international sales opportunities and participation in global value chains;
- Applying Canada’s key industrial capabilities to inform potential economic benefits of individual procurements so that they meet the Canadian Armed Forces' needs and increase the competitiveness of Canadian firms in the global marketplace; and
- Establishing an independent, third-party Defence Analytics capability which will provide expert analysis to support the objectives of the Strategy and its evaluation.
Streamlining Defence procurement processes
- Adopting a new regime to ensure streamlined and coordinated decision-making for defence and major Canadian Coast Guard procurements;
- Establishing a Defence procurement Secretariat within Public Services and Procurement Canada (PSPC);
- Applying a risk-based approach for defence procurement approvals; and
- Reviewing the current National Defence delegated authority to purchase goods with a view to increasing the level from the current $25,000 to achieve more efficient procurement practices.
Substantive industry engagement and recommendations from independent advisors, namely the Canada First: Leveraging Defence procurement through key industrial capabilities report by Tom Jenkins and the Aerospace review report by David Emerson, have provided important input and helped inform the Government's approach to developing the Strategy and improving defence procurement outcomes.
Review of Canada’s contract cost principles and profit policy
In 2015, PricewaterhouseCoopers (PwC) reviewed how we determine contract price for defence procurement. The review found that the guidance we used to determine contract price was old and needed updating to keep pace with procurement in Canada and abroad. PwC recommendations are helping us improve our price policies and practices.
- Executive summary of the review of Canada’s contract cost principles and profit policy
- Response to the review of Canada’s contract cost principles and profit policy
- Canada announces - Defence Investment Plan 2018 – May 31, 2018
- Canada announces new defence policy, Strong, Secure Engaged – June 7, 2017
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