(Ottawa) Defence Minister Peter MacKay dramatically underestimated the cost of last year’s Libya intervention, incremental cost figures released with the DND 2012-13 Report on Plans and Priorities show.
In June 2011 Minister MacKay told Canadians that the incremental cost of the Libya mission from March 2011 to the end of September would be approximately $60 million. The mission was eventually extended for one additional month, ending officially on October 31, 2011.
The figures in the government’s Report on Plans and Priorities, published this week, show that the actual incremental cost of the mission was $99.8 million, almost $40 million more than Minister MacKay estimated.
Part of that difference – probably about 15% – can be explained by the one-month mission extension. But even when Minister MacKay’s estimate is increased accordingly, to about $70 million, it still falls $30 million short of the mission’s actual cost.
“The Rideau Institute warned in June 2011 that the mission costs would likely be much higher than Defence Minister Peter MacKay had estimated, suggesting that the actual incremental costs were more likely to be in the $80 to $85 million range,” said Bill Robinson, a defence researcher and senior advisor to the Rideau Institute. “In the end, even that estimate was too low.”
But when also adjusted to account for the one-month mission extension, i.e., to about $92-98 million, the Rideau Institute estimate turns out to have been much closer to the final figure than MacKay’s estimate was.
“As in the F-35 stealth fighter fiasco, it seems that Defence Minister MacKay was low-balling the true costs of the Libya operation at the time,” said Steven Staples, President of the Rideau Institute.
Minister MacKay discussed the Rideau Institute estimate in an exchange with former defence minister John McCallum during a hearing of the Standing Committee on Government Operations and Estimates on June 14, 2011:
McCallum: My next question has to do with the cost of the Libya mission. Again, I’m a strong supporter of that mission, but in terms of cost, I think your number was approximately $60 million for the full six-month period.
MacKay: That would be, yes, the extension, presuming that the vote –
McCallum: But the Rideau Institute and others have said that the true cost is significantly greater than that. What do you include in the cost? Do you include depreciation on the planes or salaries of military people? And what is the per-unit cost of these smart bombs?
MacKay: They’re incremental costs, firstly, so they don’t include such things as depreciation or salaries. That is not normally part of what would be considered incremental costs when it comes to the mission. So the Rideau Institute, as so often is the case, is wrong.
“Actually, the estimates provided by the Rideau Institute were explicitly for incremental costs only, so it was Peter MacKay who was wrong on that point, just as it was Peter MacKay who turned out to be wrong about the actual cost of the mission,” said Bill Robinson.
The Rideau Institute is an independent research, advocacy and consulting group based in Ottawa.
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For information:
Bill Robinson, Senior Advisor to the Rideau Institute e. newman-robinson@rogers.com
Steven Staples, President of the Rideau Institute e. sstaples@rideauinstitute.ca
With the 2012 Federal Budget only two weeks away, The Canadian Centre for Policy Alternatives (CCPA), in coordination with the Rideau Institute and more than 30 other Canadian civil society organizations, has offered a different vision for Canada’s future. Titled A Budget for the Rest of Us, the 2012 Alternative Federal Budget provides a road map for Canada combat income inequality and avoid a “lost decade” of high unemployment.
Highlights of AFB 2012 include; creating a National Child Care Program, expanding the public health care system, subsidizing affordable new housing, increasing scholarships for students, and developing a more fair system of taxation.
Additionally, the AFB proposes reining in military overspending by returning the Department of National Defence budget to the more sustainable levels of the pre-9/11 period, freeing up $1.28 billion dollars for much-needed social programs in the next year alone:
The National Defence Budget must be brought in line with the changed realities that Canada faces in the world, a decade after the events of September 11, 2001…With Canadian involvement in Afghanistan winding down and our commitment to addressing the global financial crisis, an immediate reduction in the defence budget and an eventual return to pre-2001 levels are realistic goals that would set Canada on the path to fiscal responsibility in the field of expenditures.
The plan also calls for a return to Canadian peacekeeping and a significant increase in the humanitarian aid budget of the federal government.
Remarks by Steven Staples, President of the Rideau Institute, to the House of Commons Standing Committee on National Defence (NDDN) as part of its study on the readiness of the Canadian Forces.
Members of the committee, guests. Thank you for inviting me to appear today to contribute to your study on the readiness of the Canadian Forces.
I am joined by my colleague David Macdonald, an economist and contributor to the Rideau Institute, who wrote our recent report, released last fall, The Cost of 9/11.
The Rideau Institute is a non-profit, non-partisan research, advocacy and consulting group founded in 2006. It specializes in international affairs, and is funded by more than 2000 individual supporters, by commissioned research, and through our social enterprise which provides consulting services to leading Canadian non-profit groups and trade unions. We do not receive government funding, and our supporters do not receive tax deductions for their donations.
I would like to acknowledge the research contribution of David Macdonald, Bill Robinson, Josh Libben and Kathleen Aiken to our presentation today.
Your report is timely. More than a decade after 9/11, which was followed by such tremendous changes, growth, and heavy combat by the armed forces, the tide is shifting.
In answer to the question you are considering, Are they ready?, one might answer: yes they are, or no they’re not. But I think the answer to the question is a question, which is: “Ready for what?”
Readiness is a measure against a need. What threats are there to Canada? And what are the priorities for our foreign policy, to which National Defence is one contributor?
As you know, the United States has just announced a new direction for its armed forces, born out of three factors, according to the NYT: troubled government finances, winding down of wars in Iraq and Afghanistan, and a changing geopolitical environment.
Such a review is needed in Canada, since we have our own financial challenges to address, our Afghanistan combat mission has ended, and Osama bin Laden is dead.
As David Macdonald pointed out in The Cost of 9/11, in the last decade military spending has increased dramatically. Military spending has nearly doubled (90%) in ten years, 48% adjusted for inflation. When you include other departments, Canada has devoted an additional $92 billion to national security spending, $69 billion in adjusted dollars.
(See chart 1) National Defence spending has never been higher. Spending is more than $21 billion: 6th highest in real dollars in NATO, and in the top 15 globally. Despite a small decline last year, National Defence is predicting further increases – in accordance with the Canada First Defence Strategy.
(See chart 2) Looking at defence spending since the end of the Second World War, when adjusted for inflation our spending has never been higher – exceeding even the height of the Cold War when we faced off against thousands of Soviet nuclear weapons and long-range bombers. Can we say we face a greater threat than that today? And if not, should we continue spending the way we do?
The fact is, we are overspending on defence right now, and we lack a clear sense of how to determine when enough is enough.
(See chart 3) National Defence now accounts for 7.9% of total government spending. However, when you consider only federal department spending, as well as Crown corporations, defence consumes one out of every four available dollars.
As Lieutenant-General Andrew Leslie pointed out in his CF Transformation report, there is substantial room to find savings within the Department of National Defence. Every area of the government has been asked to contribute to helping our federal finances in time of need.
I have heard from many people in the last few days, more than 400 in fact, who have sent ideas for this presentation, and they are worried that their pensions are at risk, or that social programs may erode. They support a military capable of defending our sovereignty, and contributing to UN peacekeeping operations, but not at the expense of caring for people at home. Since we are overspending on defence, we can better protect our social programs through National Defence spending reductions, while still making an international contribution.
(See chart 4) Media reports have indicated that National Defence may be asked for reductions in excess of the 5% or 10% requested by the government. This is reasonable, because our examination of defence and government spending over the last decade shows that while government spending has increased by 40%, defence spending has increased by 60%. That is, defence spending has grown one and a half (1.5) times faster than government spending over the last ten years. In one year alone, the defence budget grew by more than 12%.
It’s clear that the commitments made in the Canada First Defence Strategy must be reviewed. Our allies are going through the same process – many questioning stealth aircraft programs like the F-35 – and Canada should do the same.
As Professor Walter Dorn says, there are hawks and there are doves – but what we need are more owls. We need to spend more wisely.
British Prime Minister David Cameron shared a bit of this wisdom in his speech to Parliament last year. He asked you to look at Afghanistan, and said, “If we’d put a fraction of our current military spending on Afghanistan into helping Afghanistan develop 15 or 20 years ago, just think what we might have been able to avoid over the last decade.”
We can get into a debate about whether the financial burden borne by Canadians over the last ten years was warranted. But I think we should be asking ourselves: Do we want to continue spending at this high level? And more importantly, what are our needs? Can we take action so that we are ready to meet our legitimate security needs, and contribute on the international stage in a manner that Canadians want and support?
As Lieutenant-General Andrew Leslie pointed out in his report, If we are serious about the future – and we must be– the impact of re-allocating thousands of people and billions of dollars from what they are doing now to what we want them to do, to position us for tomorrow, will require some dramatic changes.
The Rideau Institute presents researchers Professor Michael Byers and Stewart Webb as they share the results of their study of the F-35 stealth fighter, which will be published in the esteemed Canadian Foreign Policy Journal in February 2012.
Canada was in the world spotlight earlier this year, when our government refused to allow chrysotile asbestos to be put on a UN list of hazardous substances. Both in the House of Commons and at the UN, Prime Minister Harper and his ministers refused to answer increasingly exasperated questions as to its reason for blocking the listing. Instead, over and over, the government repeated the following words: “For thirty years, Canada has promoted the safe, controlled use of asbestos at home and overseas.”
As well as evading the question, this statement is untrue. In reality, for decades, Canada has done exactly the opposite.
The UN meeting was simply one more egregious example. The Rotterdam Convention promotes responsible trade in hazardous substances. Placing chrysotile asbestos on its list would require that countries obtain “prior informed consent” before exporting it. Canada refuses to act responsibly when it comes to asbestos and opposed even this minimum safety measure, thus ensuring uncontrolled trade of asbestos.
And Canada’s wrongdoing goes far deeper. Canada, in fact, is at the heart of the global asbestos lobby and has repeatedly intervened to prevent other countries from adopting safety controls or bans on asbestos.
When Thailand and South Korea decided to require warning labels on bags of asbestos, the Canadian government exerted political pressure to prevent this.
When South Africa moved to ban asbestos, Canada threatened it with trade sanctions. When Chile announced that it would ban asbestos, PM Chrétien personally telephoned Chilean President Ricardo Lagos to pressure him to withdraw the ban, causing Chilean trade unionists to hold a demonstration outside the Canadian embassy.
Canada even filed a complaint at the World Trade Organization, arguing that countries should not be allowed to ban asbestos. The WTO dismissed Canada’s case in September 2000 and dismissed it again on appeal – one of the rare times the WTO has ruled against corporate interests.
The key player in Canada’s role as global defender of the asbestos industry is the Chrysotile Institute, formerly the Asbestos Institute. Created in 1986 by the Canadian and Quebec governments and the asbestos industry with the specific aim of marketing asbestos to developing countries, it has received around $50 million, mostly from the two governments, and also from the asbestos industry. According to the Institute, representatives of the Canadian and Quebec governments sit on its board of directors.
The Harper government defers to the Chrysotile Institute as its scientific authority on asbestos. In fact, the Institute is the registered lobby group for the Quebec asbestos industry. The Institute has zero scientific credibility and is condemned by medical experts as “endangering public health by disseminating misleading and untruthful information.”
The Chrysotile Institute has assisted in the creation of similar asbestos lobby organizations in India, Russia, Brazil, Mexico and elsewhere.
Luis Cejudo Alva, the president of the Mexican asbestos lobby organisation, Instituto Mexicano de Fibro Industrias, told the BBC how the Chrysotile Institute has paid him to lobby to defeat efforts of Mexican health professionals to get asbestos banned in Mexico.
Alva told the BBC that, but for the quick intervention of Canada’s Chrysotile Institute, Peru would have followed Chile’s lead in banning asbestos. The Chrysotile Institute has played a similar role in countries such as Colombia, Brazil, Indonesia and India, to undermine efforts by health professionals to end the use of asbestos.
Canada became the nexus of the global asbestos lobby when in 1997 the Asbestos International Association (now named the International Chrysotile Association) was incorporated in Quebec under the protection of the Chrysotile Institute. Natural Resources minister, Ralph Goodale, boasted: “The location of this head office underlines Canada’s international leadership and expertise in dealing with chrysotile asbestos issues.”
In spite of its impressive name, the International Chrysotile Association (ICA), is a shadowy organisation. Mysteriously, it has now opened an office in Thetford Mines, the location of Quebec’s only operating asbestos mine. The mine is under bankruptcy protection and about to close down, having exhausted its asbestos deposit, but is seeking to extend the mine into a new deposit.
The ICA office at Thetford Mines refused to provide any information, referring people to long-time asbestos lobbyist in the US, Bob Pigg, who also refused to provide any information.
Quebec’s corporate directory, however, lists Clément Godbout, president of the Chrysotile Institute, as the lead administrator for the ICA. Then follows a list of administrators who are a who’s who of the global asbestos lobby in Indonesia, Bolivia, Peru, UAE, Mexico, Vietnam, Brazil, Iran, Kazakhstan, Russia, China, India, Senegal.
This global asbestos lobby is determined to prevent developing countries from banning asbestos, as the industrialized world has done. Thanks to the ICA, it has the money and a vehicle to do so.
Right now, in Malaysia, the Department of Occupational Safety & Health has proposed a ban on asbestos. A powerful international public relations company, APCO Worldwide, has intervened to stop this. It wants the Malaysian government to exclude chrysotile asbestos. Chrysotile asbestos represents 100% of the global asbestos trade.
APCO has refused a request to identify its client. It has been learned, however, that the client is the International Chrysotile Association.
APCO cut its teeth working for the tobacco industry. It was hired by Philip Morris in 1993 to set up a front group, the Advancement of Sound Science Coalition, to block public health efforts to protect people from second-hand tobacco smoke.
As its expert, APCO hired David Bernstein, whose work has all been funded by the asbestos industry, including a million dollar study commissioned by the Chrysotile Institute. For eighteen years prior, Bernstein carried out research for the tobacco industry.
Canada’s malevolent asbestos legacy to the world continues unabated. When will it stop?
