“The Liberals are spinning the numbers on military recruitment and spending. Just because people apply to the military does not mean they are accepted and trained. We are not paying to train them. The military is falling apart, and the Liberals are to blame.”

“Mr. Speaker, we hear a lot from this member. He seems to be the only person the Liberals put forward, and he is a fine doctor of spinning. With recruitment, the number of people who apply does not mean the number of additional personnel who have been accepted and trained. We need to train these people. We are not paying for a training budget. Everything is falling apart, and we can place that on the Liberals. The Liberals talk about the percentage. As I mentioned, a lot of what they are doing is budgetary hocus-pocus.”

“I oppose this bill. The government is avoiding its responsibilities, and we do not know how it plans to spend this money. Parliament must oversee and control all government spending.”

“Mr. Speaker, I would like to thank the member for his comments. I agree with him. I think this is yet another way for the government to shirk its responsibilities. We do not know what it intends to do about expenditures. Often, when we see other expenditures, such as those related to the green fund or other initiatives in which the Liberals’ friends are heavily involved, it becomes a serious problem. That is why we really want all of this to be carried out under the scrutiny and control of parliamentarians.”

“The Coast Guard does not count as military spending under NATO rules. Generals should run the new defence agency, not a banker picked by the Prime Minister. This bill gives one minister too much unchecked power over that agency, and that is dangerous.”

“Mr. Speaker, I thank my colleague for his excellent speech and for pointing out the accounting issue with the Coast Guard. The member opposite knows full well that the Coast Guard spending clearly does not meet NATO’s own definition, which requires it to be trained, deployable and operating as a military. In committee, I was interviewing three generals who, in my opinion, should be the ones running the Defence Investment Agency, not a banker buddy of the Prime Minister. Bill C-40 would give the newly created associate minister the direction that the DIA must follow his directions, not “may” but “must”, with little written accountability to this House. Do you agree that this would give, as has been pointed out by many people, unprecedented levels of power to one person? Is that a dangerous thing?”

“I am worried about this bill. It gives buying power to just one minister who does not answer to Parliament. That minister only answers to the Prime Minister, who controls billions of dollars and does not respect this House.”

“Mr. Speaker, I want to thank the member from Vancouver Island for his service in the military for many years. He knows the navy file. It is a challenge. I’m sorry, I have lost track of the question, but I will say that we are very concerned, as far as procurement goes, that it is going into the hands of one minister who is not accountable. Basically, that minister is accountable to the Prime Minister. Again, we are seeing this all over, where the Prime Minister has the control and a budget of billions of dollars, because we do not see a lot of respect from him toward this chamber anyway.”

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“This bill gives a new defence agency too much power without enough oversight. It lets the agency buy military gear and invest public money in private companies at the same time, which creates big conflicts of interest. The bill risks letting private investors get rich while taxpayers take all the financial risk. Parliament must fix this bill to add independent board members, strict conflict of interest rules, and clear financial limits.”

“Mr. Speaker, we all support better defence procurement in equipping our military. Today I would like to use my time to suggest a number of protections Parliament should put in place as regards Bill C-40 before we grant sweeping financial and procurement powers to the Defence Investment Agency through this bill. As currently drafted, there are still some important and, as of yet, unanswered questions about governance that I believe we need to address if we are to do the best we can for those who risk their lives on a daily basis for our freedoms. Bill C-40 is the Liberals’ third incarnation of the Defence Investment Agency in just one year. In May, the DIA was to be an agency under direct ministerial management. Five months later, it has been reimagined as an independent Crown corporation. DIA investments will be supported by public capital, also known to Canadians as “our money”. Government purchasing power and regulatory decisions will be used to de-risk private investments. I submit that Canadians providing the money and assuming the risk inherent in de-risking deserve to know that our military, not private investors, is going to reap the rewards. Let us consider one scenario that could happen under Bill C-40. Let us say the DIA acquires shares in an American manufacturer with the finance minister’s approval, because there are no actual “invest Canadian” requirements in this bill. Private equity funds and pension funds may also own shares. The agency then awards that manufacturer a substantial defence contract, perhaps even without a competitive bidding process, where an applicable exception permits it through the bill. Now suppose a competing Canadian manufacturer develops a better product at a lower price. The DIA will have a choice. It can award the contract to the competitor, potentially reducing the value of its own investment, or it can continue supporting the company in which it has a financial interest. This creates the potential for conflicting incentives within the same institution, and there are no provisions in the bill to ensure that the objective of equipping our military with the most appropriate option at the best possible price would supersede the competing objective of growing the DIA investment portfolio. That is why Parliament should insist that procurement decisions and investment decisions be made independently, with additional scrutiny when the DIA proposes awarding a contract to a company in which it holds an ownership interest. It should also establish clear financial rules governing those investments. The government should not be able to take on disproportionate financial risk while private investors enjoy most of the upside. Independent valuations, limits on financial exposure and a requirement to demonstrate that ordinary Canadians are receiving a fair return for the support they provide should all be enshrined in this bill. From a governance perspective, the DIA can have a board of as few as three directors, including the executive chairperson, the CEO and the deputy minister. There is no guarantee of any independent directors, let alone an independent majority. While ordinary audit requirements apply, there is no mandatory audit, investment or risk committee. More remarkably, the transition provisions allow the first executive chairperson to exercise all the powers of the board alone until such time as additional directors may be appointed. Especially in light of the competing investment objectives I identified earlier, Parliament should amend this bill to provide for independent directors, mandatory financial risk oversight and a prohibition on major investment decisions until that governance structure is in place. Executive compensation is another area that should also be examined closely. Cabinet determines base remuneration, but the bill does not establish how executive performance will be assessed. Compensation incentives can produce very different decisions. Will bonuses reward the amount of capital investment, the financial performance of the portfolio or the delivery of equipment to our military? Parliament should be able to ensure that the DIA is primarily focused on serving our military and protecting Canadians. That brings me back to the Prime Minister’s initial decision to appoint an investment banker rather than someone with a defence procurement background to lead this corporation, because it tells us something about the government’s ambitions for this institution. The government would not simply be creating an organization to buy military equipment. It would be creating an institution that could also finance the businesses and industrial capacity behind that equipment. The inherent competition between those objectives makes conflict of interest rules especially important here. The DIA would interact with banks, investment funds and companies whose executives may have long-standing professional relationships with its leadership. Enforceable and transparent disclosure and recusal procedures, including rules for transactions involving former employees, clients and business associates, should apply to everyone making investment and procurement decisions. We have already seen what can happen when government financing organizations operate without effective conflict of interest controls. In 2024, the Auditor General identified 90 cases at Sustainable Development Technology Canada in which conflict of interest policies were not followed, involving decisions on nearly $76 million of funding. Parliament should have learned something from that experience. Bill C-40 contains very broad exceptions to competitive procurement, including contracts intended to support strategically important Canadian industries and products previously supported by government research funding. There is no question that some exceptions are necessary in defence procurement where national security or urgent operational requirements can impact the calculus. However, Parliament should ensure that the normal governance safeguards are put in place: requiring written justification, offering the possibility of independent review and appropriate reporting when competition is bypassed. We also need to address ministerial directions. Section 9 would allow the minister, or the assistant minister and associate minister in this case, to direct the corporation’s activities and require the corporation to comply, yet there would be no equivalent express requirement to table those directions in Parliament. That would create an uncomfortable arrangement where the corporation is supposed to have commercial independence but ministers retain substantial influence without the transparency normally associated with formal directions to Crown corporations. All material ministerial directions should be documented and disclosed, subject to legitimate national security restrictions. The same principle applies to the corporation’s finances. Bill C-40 would provide a revolving $1-billion payment authority for the corporation, a separate $1-billion authority for ministerial activities, and the possibility of loans from the Minister of Finance. Those provisions would not establish a single overall limit on the corporation’s financial exposure. The bill should provide for a complete accounting of the available funding mechanisms, the limits on borrowing and guarantees, and the source of funding for equity acquisitions. Parliament should receive regular reports showing how much money has been invested, who has received it, the value of outstanding guarantees, the losses incurred and the returns earned. Canadians should be able to understand what has happened to their money. Bill C-31 provided for a legislative review within three years. Bill C-40 would extend that period to five years. With that, the government would be creating a more complicated financial institution, while waiting longer to see whether it is working. That should be corrected. Canada needs a more effective defence procurement system. We need our military to be properly equipped, and we should be developing Canadian industrial capacity wherever it makes strategic and economic sense, but the priority must remain the defence of Canada and the interests of Canadian taxpayers. Governance matters. Many of the provisions I have spoken about today may be quite dry, but they are very important. It is not just conflicts of interest that matter. It is also the appearance of those conflicts. When government acts as investor, lender, guarantor and customer, the opportunities for private profit can be substantial, and so can the opportunities for financial losses, poor procurement decisions and preferential treatment. The government has decided it wants to use these powers. The responsibility of Parliament now is to ensure that they are exercised under rules that protect the public interest. The Defence Investment Agency should not become a place where private investors get the financial rewards of government decisions while ordinary Canadians are left paying the bills. I submit that we have opportunities to improve the governance provisions in these bills and that we ought to do exactly that.”

“Some government-owned corporations are run well. But this bill needs to do a much better job of showing how this new defence corporation will be run. I just proposed specific ways to fix that.”

“Mr. Speaker, I would submit that if the hon. member had listened to my speech, he would know that I have just proposed a number of very specific measures that I believe would enhance the governance of this particular Crown corporation. I do agree with him that there are some Crown corporations that have excellent governance mechanisms. At the moment, on the surface of the bill before us, I think there is much room for improvement.”

“I agree that this bill has serious transparency problems. People have raised many concerns about accountability, and the government needs to listen to them. We still have a lot of work to do on this bill.”

“Mr. Speaker, I would like to thank the member for his question, and I am continuing to work on being able to answer questions in French. I do agree that there are some significant transparency issues. I am encouraged in some ways by the fact that this is really the third iteration of the organization. However, there have been many concerns around transparency and accountability raised in the chamber thus far, and I would urge the government to pay close attention to them. I think there is substantial and significant work to be done on the bill.”

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“I am worried about this bill. Creating this new government corporation could pull us into the American military system and lead to contracts Canadians do not want.”

“Mr. Speaker, it was not very long ago that BC Ferries awarded a contract to China. That was not in the interests of the Canadian people, and most people we talked to on the street thought it was absolutely ridiculous. Meanwhile, the federal government gave billions of dollars to BC Ferries, but the Liberals just shrugged their shoulders with no regard. Would allowing this Crown corporation open the door for the Crown corporation to be sucked into the American military complex? We would then have a situation such as BC Ferries, where it would be awarding contracts that the Canadian people may not appreciate.”

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“This bill does not require investing in Canadian businesses. The Liberals need to fix it so it helps Canadians more.”

“Mr. Speaker, I thank the hon. member for the concern he shows for people in my community, who, like the people in his community, are dependent upon ferry services for most of their daily existence. This is one of the reasons I wanted to highlight the importance of the fact that there are currently no invest Canadian provisions in the bill. Many members have raised issues, and I think a number of them are legitimate. I hope the government is paying attention to these debates and remarks, and that the Liberals will go back to the drawing board and make some improvements to the bill that would enhance the impact of these very important decisions on Canadians.”

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“This bill is not ready. It could cause conflicts of interest and bad unintended results. Parliament needs to make major changes to improve it.”

“Mr. Speaker, again, it goes to the fact that the bill feels like one that is half-baked. There are so many possibilities. I go back again to the fact that it would not just be an actual legal conflict of interest that we need to be concerned with. We need to also be concerned about appearances. Right now, I think that the government is actually leaving itself vulnerable to all kinds of unintended consequences if Parliament is not given a chance to have a substantially amended and improved bill.”

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