US embassy cable - 04OTTAWA3111

C O N F I D E N T I A L SECTION 01 OF 03 OTTAWA 003111 
 
SIPDIS 
 
CONFIDENTIAL NOFORN 
 
SIPDIS 
 
SERIAL:  (U)  IIR 6 815 0010 05. 
 
COUNTRY:  (U) CANADA (CA). 
 
IPSP:  (U) IFC1511; IFC1513; IFC1516; IFC1311; IFC1547; IFC1520; IFC152 
1; IFC1912. 
 
TAGS: PARM, Canadian Military 
SUBJECT: IIR 6 815 0010 05/CANADIAN DEFENCE REVIEW BECOMING 
SCHIZOPHRENIC (U) 
 
 
WARNING:  (U) THIS IS AN INFORMATION REPORT, NOT FINALLY 
EVALUATED INTELLIGENCE.  REPORT IS CLASSIFIED C O N F I D E N 
T I A L/NOFORN. 
 
--------------------------------------------- ------------ 
                     DEPARTMENT OF DEFENSE 
--------------------------------------------- ------------ 
 
DOI:  (U) 20041105. 
 
REQS:  (U) DHCD127055; DHCD204011. 
 
SOURCE: A. (C) //6 815 0364// SENIOR HOST NATION MILITARY 
OFFICER WHO HAS REPORTED RELIABLY IN THE PAST. 
 
B. (C) //6 815 0365// SENIOR HOST NATION MILITARY OFFICER WHO 
HAS REPORTED RELIABLY IN THE PAST. 
 
C. (C) //6 815 0194// SENIOR HOST NATION MILITARY OFFICER WHO 
HAS REPORTED RELIABLY IN THE PAST. 
 
D. (C) //6 815 0199// SENIOR HOST NATION MILITARY OFFICER WHO 
HAS REPORTED RELIABLY IN THE PAST. 
 
E. (C) //6 815 0121// SENIOR HOST NATION MILITARY OFFICER WHO 
HAS REPORTED RELIABLY IN THE PAST. 
 
F. (C) //6 815 0361// SENIOR HOST NATION MILITARY OFFICER WHO 
HAS REPORTED RELIABLY IN THE PAST. 
 
G. (C) //6 815 0366// SENIOR HOST NATION GOVERNMENT OFFICIAL 
WHO HAS REPORTED RELIABLY IN THE PAST. 
 
H. (U) SITREP, ROYAL CANADIAN MILITARY INSTITUTE, 
SEPTEMBER/OCTOBER, 2004 (U). 
 
SUMMARY: (C/NF) CANADA'S LONG-AWAITED DEFENCE REVIEW IS 
LIKELY TO BE A WATERED DOWN UPDATE RATHER THAN 
TRANSFORMATIONAL.  DEVELOPED IN PARALLEL WITH THE 
INTERNATIONAL POLICY REVIEW IT WILL HAVE POLICY AND RESOURCE 
DISCONNECTS. BUDGETARY ENVIRONMENT DIFFICULT. 
 
TEXT:  1. (C/NF) CANADA'S DEFENCE REVIEW EXPECTED BEFORE THE 
END OF CY2004 WILL LIKELY BE DELAYED INTO CY2005.  THE 
FOREIGN AFFAIRS CANADA (FAC) INTERNATIONAL SECURITY POLICY 
REVIEW BEING DEVELOPED IN TANDEM, BUT WITHOUT COMPLETE 
TRANSPARENCY, IS LIKELY TO PROVE A MISMATCH WITH SOME DEFENSE 
OBJECTIVES AND BOTH ARE LIKELY TO BE UNDER-RESOURCED. 
ACCORDING TO SOURCE B, THE DEFENCE REVIEW WILL NOT CASCADE 
FROM THE INTERNATIONAL SECURITY POLICY REVIEW AND THE 
20040417 FIRST-EVER NATIONAL SECURITY POLICY AS ONE MIGHT 
EXPECT.  ADDITIONALLY, THE DEFENCE REVIEW IS UNLIKELY TO BE 
RELEASED IN TIME TO INFLUENCE THE 20050200 BUDGET FOR FY2005 
BEGINNING 20050401. SOURCE C AND OTHER SENIOR DEFENSE LEADERS 
ARE CONCERNED THAT THE FY2005 BUDGET WILL BE THE LAST 
OPPORTUNITY FOR A NUMBER OF YEARS TO GET A PLUS-UP FOR 
DEFENSE BECAUSE THE FY2006 BUDGET WILL LIKELY BE AN ELECTION 
BUDGET AND FOCUS HEAVILY ON MORE POPULAR SOCIAL SPENDING TO 
GARNER VOTES.  THE INITIAL COUPLE OF BUDGETS AFTER THE NEXT 
ELECTION (WIDELY EXPECTED IN 2006) WILL STRUGGLE TO KEEP 
THOSE SPENDING PROMISES FOR SOCIAL PROGRAMS. 
 
2. (C/NF) THE INTERNATIONAL SECURITY POLICY REVIEW WILL FOCUS 
ON THE CANADIAN 3DT APPROACH OF DIPLOMACY, DEFENSE, 
DEVELOPMENT, AND TRADE.  THE 3DT APPROACH WILL CARRY THROUGH 
INTO DEFENSE, BUT ACCORDING TO SOURCE E THERE ARE SIGNIFICANT 
DISCONNECTS IN THE POLICIES AND RESOURCES. AT THE SAME TIME, 
DEFENSE WILL BE CALLED UPON TO TRANSITION FROM A PEACEKEEPING 
FOCUS TO A 'NATION-BUILDING' FOCUS, INTEGRATING THE ELEMENTS 
OF DEVELOPMENT AND TRADE. THE DEPARTMENT IS TRYING TO HOLD 
THE LINE ON ONLY PROVIDING TROOPS WHERE THEY CAN MAKE A 
DIFFERENCE MILITARILY.  ACCORDING TO SOURCE F, THE DEPARTMENT 
OF NATIONAL DEFENCE (DND) IS ATTEMPTING TO KEEP THE CANADIAN 
ARMY IN THE NICHE OF PROVIDING FORCES FOR 'HIGH-END 
INTERVENTION', NOT HUMANITARIAN ASSISTANCE (HA) AND CIVIL 
AFFAIRS (CA). ACCORDING TO SOURCE C, TROOPS PARTICIPATING IN 
SFOR IN BOSNIA OVER THE LAST FEW YEARS HAVE BEEN INVOLVED IN 
CIVIL SUPPORT AND LIGHT DUTY MISSIONS RATHER THAN HARD 
SECURITY AND THIS HAS CONTRIBUTED TO A DECLINE IN THE MORALE 
OF THOSE SOLDIERS  AND LESS WILLINGNESS TO DEPLOY FOR SOFT 
SECURITY MISSIONS.  (FIELD COMMENT:  THIS IS A PRIME REASON 
WHY CANADA IS SEEKING A CHALLENGING PROVINCIAL RECONSTRUCTION 
TEAM (PRT) MISSION IN AFGHANISTAN.) 
3. (U) ACCORDING TO SOURCE H, THE IMPACT OF THE 3DT APPROACH 
IS THAT THE SUCCESS OF CANADIAN FOREIGN POLICY INITIATIVES 
WILL BE INCREASINGLY DEPENDENT ON THE FUNDAMENTAL 
CAPABILITIES OF THE CANADIAN FORCES (CF) TO UNDERTAKE 
SECURITY OPERATIONS DESIGNED TO SUPPORT AND FACILITATE THE 
'DIPLOMACY' AND 'DEVELOPMENT' PILLARS OF 3DT.  SOURCE NOTES 
THE CAPABILITY OF THE CF TO UNDERTAKE THOSE OPERATIONS IS 
DEGRADED BY A FIXED OR DECLINING (IN REAL TERMS) DEFENSE 
BUDGET; RISING OPERATIONS AND MAINTENANCE (O&M) COSTS; 
SHRINKING CAPITAL BUDGETS; AND BY A 'DEFACTO DEFENCE 
CAPABILITIES TRIAGE AS CAPABILITIES SIMPLY DROP OFF THE TABLE 
DUE TO CAPITAL EROSION'. 
 
4. (C/NF)  THE DEEPER ONE DELVES INTO THE ONGOING REVIEW THE 
MORE SCHIZOPHRENIC IT SEEMS. THE GOVERNMENT HAS CALLED FOR 
5,000 NEW REGULAR TROOPS AND 3,000 RESERVISTS, YET THEY HAVE 
NO CAPACITY TO TRAIN AND FIELD THEM FOR YEARS.  PM MARTIN HAS 
PROMISED MORE MONEY FOR THE TROOPS YET HE HAS NO SPECIFICS 
OTHER THAN TO REFER TO THE INVESTMENTS ANNOUNCED LAST YEAR IN 
MARITIME HELICOPTERS, MOBILE GUN SYSTEMS, AND JOINT SUPPORT 
SHIPS (A 6-10 YEAR PROJECT).  THIS, WHILE THE GOVERNMENT HAS 
A 9 BILLION CANADIAN DOLLAR (USD 7.2 BILLION) SURPLUS 
EQUIVALENT TO 70 PERCENT OF THE DEFENSE BUDGET.  NO ONE IS 
TALKING ABOUT USING ANY OF THE SURPLUS FOR DEFENSE. 
ACCORDING TO SOURCE H, THERE IS A 1.6 BILLION CD (USD 1.3 
BILLION) (OVER 10 PERCENT OF THE TOTAL BUDGET) STRUCTURAL 
DEFICIT IN THE DEFENSE O&M BUDGET DRIVEN BY: 
 
A. (U) THE NEED TO RENT CIVILIAN EQUIPMENT AND SERVICES SUCH 
AS AIRLIFT IN PLACE OF INOPERATIVE MILITARY EQUIPMENT (E.G., 
19 OF 32 C-130 HERCULES WHICH ARE NON-OPERATIONAL); 
 
B. (U) THE VAST AMOUNTS OF RESOURCES BEING POURED INTO THE 
MAINTENANCE OF OBSOLETE EQUIPMENT WAITING FOR THEIR 
REPLACEMENTS TO COME ON LINE (E.G., CH-124 SEA-KING MARITIME 
HELICOPTERS AND CC-115 BUFFALO FIXED WING SEARCH AND RESCUE 
(SAR) AIRCRAFT); 
 
C. (U) THE HIRING OF EXPENSIVE CIVILIAN CONTRACTORS WHO DRAW 
MASSIVE OVERTIME TO SUPPLY FIELD LOGISTICS SUPPORT IN PLACES 
LIKE AFGHANISTAN AND THE BALKANS; AND: 
 
D. (U) THE INCREASING COSTS OF REAL PROPERTY MAINTENANCE OF 
WORN-OUT INFRASTRUCTURE ON CANADIAN BASES WHICH ARE KEPT OPEN 
FOR POLITICAL RATHER THAN MILITARY OPERATIONAL REASONS. 
 
5. (C/NF) ACCORDING TO SOURCE D, THE DEFENCE REVIEW WILL ALSO 
CALL FOR AN INCREASE IN STRATEGIC LIFT, BUT MAY POINT TO THE 
JOINT SUPPORT SHIP AS SATISFYING THAT REQUIREMENT WHILE THE 
MILITARY CONTINUES TO RENT UKRAINIAN AN-124 AIRLIFT TO DEPLOY 
THE ARMY.  EVEN THOUGH A NO-COST OPTION OF LEASING FOUR C-17S 
(THROUGH RETIREMENT OF OLDER C-130S AND REDUCTION IN AN-124 
RENTAL COSTS) HAS BEEN PRESENTED TO THE GOVERNMENT OF CANADA, 
ACCORDING TO SOURCE B THE GOVERNMENT STILL HAS A HANGOVER 
FROM THE CANCELLATION OF THE PREVIOUS C-17 LEASE OPTION BY 
THEN MINISTER OF NATIONAL DEFENCE ((MCCALLUM)) WHO REMAINS IN 
CABINET AND HAS MADE DEFENSE PLANNERS RELUCTANT TO READDRESS 
THE ABYSSMAL STRATEGIC AIRLIFT SITUATION. (FIELD COMMENT: 
THE ISSUE OF HAVING ORGANIC AIRLIFT MAY GET ADDITIONAL 
ATTENTION AFTER CANADA HAD TO RENT AN AIRPLANE TO EVACUATE 
CANADIANS FROM COTE D'IVOIRE.  SEVERAL SENIOR OFFICERS MADE 
THE POINT THAT CANADA SHOULD NOT BE DEPENDENT UPON RENTING 
AIRLIFT WITHOUT DEFENSIVE SYSTEMS TO ACCOMPLISH NONCOMBATANT 
EVACUATION OPERATIONS (NEO)). 
 
6. (C/NF) IN A RECENT MEETING WITH U.S. GENERAL AND FLAG 
OFFICERS, SOURCE G ANNOUNCED THAT 'CANADA REQUIRED A NATO OR 
UNITED NATIONS MANDATE BEFORE DEPLOYING TROOPS.'  WHEN A FLAG 
OFFICER QUERIED SOURCE G ON WHAT ADDITIONAL MANDATE IS 
REQUIRED WHEN NATO HAS ALREADY CALLED FOR TROOPS TO TRAIN THE 
IRAQI ARMY AND THE UN IS REQUESTING TROOPS TO SECURE UN 
PERSONNEL ATTEMPTING TO ENSURE FREE AND SAFE ELECTIONS IN 
20050100, SOURCE G OPINED THAT 'THIS IS WHEN CANADA INVOKES 
THE STRATEGIC PAUSE AND THE FACT WE DO NOT HAVE THE CAPACITY.' 
 
7. (C/NF) SOURCE F HAS BEEN HIGHLY FRUSTRATED BY THE ENTIRE 
DEFENSE REVIEW PROCESS AND CALLED IT 'SCHIZOPHRENIC.'  EVEN 
THOUGH THERE HAVE BEEN PLANS MADE AT THE REQUEST OF THE CHIEF 
OF DEFENCE STAFF TO STUDY HOW CANADA MIGHT CONTRIBUTE TO 
TRAINING AND EQUIPPING THE IRAQI ARMY, THE IRAQ ISSUE IS SO 
CHARGED IN PARLIAMENT AND DOMESTICALLY THAT CANADA WILL BE 
UNLIKELY TO EVEN PROVIDE IRAQI ARMY TRAINING OUTSIDE IRAQ, 
SUCH AS INVITING IRAQI OFFICERS AND NCO'S TO PARTICPATE IN 
MILITARY TRAINING COURSES IN CANADA. 
 
COMMENTS: 1. (C/NF) FIELD COMMENTS. FRUSTRATIONS ARE RUNNING 
HIGH AS THE DEFENCE REVIEW ENTERS ITS FINAL PHASE. 
INTER-SERVICE RIVALRIES ARE REEMERGING WITH SOME CAPITALIZING 
ON THE CHICOUTIMI SUB ACCIDENT TO CALL FOR AN END TO SUBS IN 
THE CANADIAN FORCES, WITH THE ARMY NOT SUPPORTING STRATEGIC 
AIRLIFT FOR THE AIR FORCE ('WE'VE ALWAYS GOTTEN THERE 
SOMEHOW, HAVEN'T WE?'). BOTH THE GOVERNMENT AND THE POLLS ARE 
SAYING MORE SHOULD BE SPENT ON DEFENSE WHILE, AT THE SAME 
TIME, THE GOVERNMENT IS ASKING FOR MONEY BACK FROM DEFENSE. 
OF THE 800 MILLION CD (USD 650 MILLION) ADDED ANNUALLY TO THE 
DEFENSE BUDGET TWO YEARS AGO, THE GOVERNMENT WANTS BACK 135 
MILLION CD (USD 110 MILLION) THIS YEAR, 185 MILLION CD (USD 
150 MILLION) IN FY2005, AND 480 MILLION CD (USD 400 MILLION) 
FOR FY2006 AND BEYOND (FROM A DEFENSE BUDGET OF JUST OVER 12 
BILLION CD (USD 10 BILLION)) TO PAY FOR HEALTH CARE, CHILD 
CARE, AND OTHER SOCIAL PROGRAMS. OPTIONS ARE BEING CONSIDERED 
SUCH AS CUTTING THE OPERATIONAL BUDGET BY FIVE PERCENT, 
CLOSING BASES (EXTREMELY POLITICALLY SENSITIVE - AN ORDER OF 
MAGNITUDE HIGHER THAN BRAC), AND RETIRING NAVAL RESERVE 
VESSELS. 
 
2. (C/NF) WHILE THE TOP-HEAVY CANADIAN MILITARY TOTTERS 
ALONG, THERE IS LITTLE CAUSE FOR OPTIMISM THAT THIS DEFENCE 
REVIEW IS GOING TO BE THE CATALYST FOR ANYTHING MORE THAN 
PRESERVING EXISTING SERVICE EQUITIES, SALAMI-SLICING OF A 
BUDGET TOTALLY INCAPABLE OF SUSTAINING AND RECAPITALIZING 
EVEN THE SMALL EXISTING FORCE, AND DELIVERING WEAK PLATITUDES 
ON HOW CANADA'S MILITARY WILL BE A VITAL CONTRIBUTOR TO THE 
3D APPROACH, CONTINENTAL SECURITY, AND GLOBAL PEACE 
OPERATIONS. 
 
3. (U) SOURCES REMAIN AVAILABLE FOR FURTHER EXPLOITATION. 
 
4. (C/NF) THIS REPORTING SUPPORTS PRIORITY 3, PARAGRAPHS 1B 
AND 1D OF THE DAO OTTAWA OPERATING DIRECTIVE. 
 
5. (U) DIRECT ANY QUESTIONS CONCERNING THIS IIR TO DHO-1 AT 
STU III (703) 907-0541, OR GRAY 981-8236. 
 
COLL:  (U) AB; AC; AD; AH; AS; AI; DB; MM. 
INSTR: (U) US NO. 
PREP:  (U) 6-03048. 
ACQ:  (U) CANADA, OTTAWA (20041115). 
DISSEM:  (U) FIELD:  AMEMB OTTAWA. 
WARNING:  (U) REPORT CLASSIFIED 
C O N F I D E N T I A L/NOT RELEASABLE TO FOREIGN NATIONALS. 
 
SIPDIS 
DRV FROM:  DO HUMINT SCG SEPTEMBER 2003 
DECL ON:  X1