at the crossroads

Grant McDonald

Managing Partner & Head of Tax, and KPMG Global Sector Leader, Aerospace and Defense

KPMG in Barbados


​This article was first published in the Canadian Defence Review Magazine in December 2020

By Grant McDonald

Strong at home, secure in North America and engaged in the world. This is the vision set out in Canada's defence policy, Strong, Secure, Engaged (SSE), which directs Canada to work with the U.S. to ensure that NORAD – the North American Aerospace Defense Command, is modernized.

It is time. Even in the midst of fighting the war on COVID-19, Canada cannot lose focus on NORAD nor its obligations as a founding member of the North Atlantic Treaty Organization (NATO). In fact, the global pandemic has amplified international insecurity and exacerbated geopolitical tensions.

The breadth and scope of our national security risks have never been greater. We are under siege from the growing proliferation of cyberattacks from state and non-state actors. Our northern sovereignty is under attack as climate change opens up maritime traffic, increasing boundary disputes and unlicensed natural resource exploitation. Ballistic missiles – now considered a premodern combat weapon – pale next to new weapons technology from hypersonic glide vehicles, unmanned aerial systems and new-generation cruise missiles. The list of potential threats to Canadian safety and sovereignty is unfortunately a long one.

NORAD – born out of the Cold War in 1957 by the U.S. and Canada – controls and protects Canadian and American airspace against possible aircraft, missile, or space attack. A maritime warning function was added in 2006. Since Russia restarted its long-range aviation program in 2007, NORAD had intercepted several Russian bombers every year. In just the first 10 months of 2020, there have been 14 such interceptions.

The short- and long-range ground-based, unmanned radar stations – known as the North Warning System – are no longer adequate in this hyperconnected world where the consequences of a slipup can be catastrophic. NORAD requires modern tools to detect, track, identify, deter and defeat all threats to both Canada and the U.S.

A recent paper from the Conference of Defence Associations Institute (CDAI) sheds important light on the role Canada's aerospace and defence (A&D) industry can play in the modernization of NORAD. The paper calls upon industry to stay abreast of defeat developments, in particular sensor and joint all-domain command and control (JADC2) capabilities. It encourages the federal government to direct and prioritize R&D activities and create a new procurement program, one that includes a "buy and try" approach with open architecture to rapidly grow JADC2.

JADC2 aims to connect existing and future sensors from all U.S. military services – the Air Force, Army, Marine Corps, Navy, and Space Force – into a single network, harnessing the power of technology to analyze the intelligence, surveillance and reconnaissance data so that commanders can make faster and better-informed decisions. The amount of data from sensors is growing exponentially, with much of it left on the cutting-room floor. Artificial intelligence (AI) can help to process and present it in actionable form.

Canada is a leader in quantum computing, data analytics, AI and machine learning (ML) – the very technologies that will enable JADC2. The federal government should be encouraged to think outside the box, by providing incentives for innovative non-traditional defence players to join JADC2 development. Exploring public-private partnerships while considering how to protect intellectual property rights will also need to be addressed.

There is also a need for enhanced, less burdensome data and technology transfer between our two countries. While this has been a somewhat challenging policy issue, we need to solve the classification conundrum, preserving protections but permitting appropriate classifications in a timely process to ensure Canadian companies can participate fully – as they should - in NORAD's renewal.

The need to modernize is imperative. Under SSE, a number of current and planned investments contribute to continental defence. These include the naval surface combatants and Arctic patrol vessels, the air force fighter jets as well as remotely piloted systems and additional space capabilities.

More specific NORAD initiatives are moving forward. Recently, it has held Joint Agile Basing Airpower Seminars to bring key stakeholders in science, environment, information, governance, and logistics together to look at the challenges of agile basing in the Arctic to explore synergies between air operations, Indigenous communities, security, climate science, and economic development. The use of nanosatellites was discussed among the topics to support many functions that would benefit both the military and Northern and Indigenous communities, such as communications, data relay, exploration, remote sensing to astronomy.

So much still needs to be accomplished. Canada's A&D industry is a wellspring of technological innovation which can contribute to the overall modernization efforts.

We stand at the crossroads. Decisions must be made, which cannot be put off much longer, and the Canadian and U.S. A&D industry can contribute in a meaningful way.

Will NORAD continue to be relevant in detecting, deterring and responding to threats against Canada and the continent?

It is time to determine our legacy.

Grant McDonald is the Global Aerospace and Defence Industry Sector Leader at KPMG in Canada.

© 2022 KPMG LLP, an Ontario limited liability partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

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