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Federal Conservatives have demanded the Carney government open the books on the recent $2.3-billion military satellite deal with Telesat — a call that lays the groundwork for a bruising political battle this fall depending upon how far they want to take it.
The Official Opposition wants to see public disclosure of the contract and what sort of safeguards were put in place to prevent a conflict of interest for Prime Minister Mark Carney.
The plan to deliver state-of-the-art, secure communications for the Canadian military in the Arctic languished for decades before it was formally set in motion last week.
Carney and the CEO of Telesat, Dan Goldberg, are longtime friends and conservative pundits lit up social media last week with comments and concerns about the program.
James Bezan, the Conservative defence critic, said it’s important to get the satellite capability into the hands of the military as quickly as possible, but the public needs an extra level of reassurance, given that the contract award was expedited over a matter of several months.
“This is about a matter of trust and transparency,” Bezan said. “We’re calling for a release of the contract, the terms of the contract and the decision-making process that was used by the government right up to the prime minister and cabinet.”
That could be a tall order. The confidentiality of corporate contracts and cabinet discussions is deeply institutionalized within the federal government and protected by legislation.
Specifically, cabinet confidentiality hides why a project was selected, and commercial exemptions keep the exact terms of the deal under wraps. The public and opposition MPs often rely on independent watchdogs, such as the auditor general or parliamentary budget officer (PBO), to retroactively investigate whether Canadians received good value for taxpayer money.
The last major battle over cabinet confidentiality and document access in Parliament took place two years ago in a historic fight over Sustainable Development Technology Canada — or the “green slush fund” as the opposition referred to it.
The Conservative-led opposition passed a binding House of Commons order demanding the Liberal government turn over all internal files regarding that foundation to Parliament’s law clerk. The fight ended when House Speaker Greg Fergus delivered a landmark ruling that sided with the opposition, stating that the House’s constitutional power to order documents is absolute and supersedes cabinet confidentiality and privacy laws.
Bezan said the Telesat deal needs to be closely examined because of the prime minister’s friendship with Goldberg: “Was the ethics screens used? Was Prime Minister Carney involved in the decision-making process? Did he recuse himself when these discussions were taking place at the cabinet table?”
In a written statement, the Privy Council Office (PCO) said the awarding of the contract by the Defence Investment Agency followed the proper process.
Carney, upon assuming office, agreed to a conflict-of-interest screen that applies to any decision that could improperly benefit a private interest.
The federal government has unveiled its ‘Build at Home’ defence industrial strategy, which shifts away from heavy reliance on the U.S. and other foreign suppliers and makes having military equipment built in Canada the default.
“This screen is respected at all times,” said Pierre Cuguen, a spokesperson for PCO. “This conflict-of-interest screen is administered by the prime minister’s chief of staff and the clerk of the Privy Council to ensure that the prime minister is neither informed of official matters or decision-making processes involving the interests of the companies concerned, nor called upon to participate in them.”
Goldberg said Carney had nothing to do with the contract award and he expressed frustration with the Opposition’s claims.
He pointed to a Conservative government first proposing the Arctic satellite network in 2008.
“This was a Harper government initiative,” Goldberg said.
“We went through an absolutely rigorous process, identifying, I think it was at one point, something like 20 to 24 different kinds of alternative, kind of network configurations that could meet the [military] requirements.”
Conservatives also expressed concern about the $600-million contract that Telesat was given to bring broadband connectivity to the Far North under the federal Universal Broadband Fund. The program was hit with a series of delays, including supply chain issues related to the COVID-19 pandemic.
Originally, Telesat had contracted with France’s Thales Alenia Space to build the satellite fleet. But supply bottlenecks and severe post-pandemic inflation forced Thales to raise prices beyond the scope of the project’s budget.
Telesat restructured the entire program and pivoted to Canada’s MDA Space as the new prime contractor. In 2024, the company renegotiated federal and provincial loan guarantees to ensure delivery of the satellite system by 2028.
Goldberg said they’re on track to meet that target.
“My colleagues and I at Telesat are overwhelmingly proud to be a part of delivering this much-needed capability, delivering it early, delivering at a phenomenal value proposition to the Canadian taxpayer,” said Goldberg.
“It was procured in an absolutely rigorous arm’s-length manner.”
