Diane Finley Highlights Defence Industry Owe Large Economic Activity

A federal cabinet minister has publicly highlighted that several defence industry has failing to make more than $5-billion in investments into the Canadian economy, which is a mandatory compulsion for winning military contracts. Defence companies are bound to undertake an equivalent amount of business activity in Canada as the original contracts are worth, which implies that they must make up whatever they outsource to foreign firms in work, supplies and services.

However, the business activity may be in a variety of forms, including sharing technological developments with Canadian companies, investing money into academic research, or purchasing parts and services from a Canadian company for another project. In the statement issued on Wednesday by Public Works Minister, Diane Finley, it was mentioned that one quarter of the $23-billion in commitments made by defence companies by the end of 2011 is still unfulfilled. And alleged that the number would have significantly increased if recent years were taken into account.

Finley is tasked to launch a new federal defence procurement plan. For the time being, she refrained from publicly naming the companies with outstanding obligations but it was mentioned that the government “will make companies publicly accountable for what they propose so that we have transparency in regard to investments that are being made.” According to the new defence procurement plan, several changes have been made in the way companies commit to invest in Canada, along with a public reporting requirement that Finley said “will help ensure that benefits are actually realized, as promised.”

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