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Volume 2: Reaching Higher: Canada's Interests and Future in Space – November 2012

Part 3
Analysis and recommendations (continued)

Chapter 3.1
Establishing clear priorities and plans

Public programs related to space must be grounded in carefully considered priorities that reflect the needs and advice of a wide range of users and stakeholders, and are advanced through rigorous plans and stable funding.

Effective priority-setting and implementation are, of course, always necessary when governments make choices about the use of finite public resources—but they are doubly so when every project involves multiple players and requires a significant investment of time and resources, a unique design, a dedicated manufacturing process, and repeated, rigorous testing along the way. A lack of clear priorities and plans increases the chances that substantial public monies will be spent without realizing sufficient positive impacts on the national economy, security, and delivery of public services. In an area as important and complex as space, ad hocery is costly, inefficient, and counter-productive.

A clear sense of direction in the public space program is also important for the space industry, given that government remains the largest customer for space assets outside of commercial satellite communications. Companies need a reasonable level of predictability in their markets in order to make sound business decisions and properly deploy the substantial capital and resources involved.

For a number of countries with space programs comparable in size to Canada's, these considerations have led to revisions in governance arrangements for space-related activities. These changes have been designed to increase the involvement of the highest levels of government in setting overall program priorities, foster coordination across ministries, clarify the roles of national space agencies, and better engage the private sector. For example:

• The United Kingdom has established a space agency for the first time. The agency reports directly to the Minister of State for Universities and Science, and has overall responsibility for all of the country's publicly funded civil space activity. Government departments, research institutions, industry, and publicly funded non-governmental bodies with space-related activities sit on a Space Leadership Council that advises the Minister and agency on national space priorities.
• Japan has created a Cabinet-level committee, chaired by the Prime Minister and supported by a dedicated secretariat in its Cabinet office, with a mandate to establish national space-related priorities, coordinate space-related activities across government, and strengthen the role of the private sector in Japan's space program. The role of the country's space agency, JAXA, has been clarified as one of research, advice, and implementation, not policy-setting.
• Brazil has set up a national council for space policy at the ministerial level, chaired by the President, and has strengthened the mandate of its space agency to support the establishment of priorities for the country's space program and coordinate their implementation. Similar to the situation with Japan's JAXA, the role of Brazil's National Institute for Space Research has been focused on research and implementation.

Figure 10: Space budgets of selected OECD and non-OECD countries as a share of GDP – 2009

Description of Figure

This horizontal bar chart shows the space budgets of 26 selected Organisation for Economic Development and Co-operation (OECD) and non-OECD countries in 2009, as a percentage of gross domestic product (GDP). Among this group, Sweden had the lowest space budget at 0.002% of GDP while the United States had the highest at 0.309%. Canada ranked 15th, with a budget of 0.024% of GDP, and was surpassed by the following countries (in descending order of their budget): the United States, Russian Federation, China, France, Japan, India, Belgium, Germany, Italy, Israel, Norway, Finland, Korea, and Luxembourg.

Source: OECD.

GDP = gross domestic product
OECD = Organisation for Economic Co-operation and Development

Although Canada's public space program has had many successes and is well-regarded internationally, the steps other countries have taken to elevate the priority of space, more clearly delineate responsibilities, and better manage across multiple programs and departments are instructive.

The reality is that over the last decade or so, while other players have modernized their space programs through national strategies and stronger governance, Canada's priorities have been ambiguous and implementation has been below the necessary standard. There is no over-arching articulation of what we want to do in space or how we want to do it. There is no clear mechanism to manage space activities across government. Individual projects such as the RADARSAT Constellation Mission have been announced, only to disappear from view and then reappear later. The CSA's budget has been reduced even as Canada has entered into new commitments, such as extending its participation in the International Space Station until 2020. And Canada's lead with respect to key technologies like space robotics and optical instrumentation is being eroded, in part due to the greater determination other countries have brought to their space programs.

It is essential that there be a Canadian Space Program that is energized and focused through a clear sense of purpose, strong and consistent engagement of stakeholders, more rigorous planning and implementation, and stable funding.

Recommendation 1: Canadian Space Program priorities

Canada's space program will be most effective at promoting the national interest and providing services to Canadians if it is anchored in priorities set at the highest levels after appropriate consultation across government and with industry and researchers. In the main, these priorities should be stable, given that the development and deployment of a space asset is a multi-year process that requires sustained commitments of public and private resources.

These priorities should:

• be developed on the basis of advice from ministers from all interested portfolios, along with provinces and territories, industry, and experts from research and academic institutions—this advice will come in part from the Advisory Council described in recommendation 2;
• reflect the areas in which space assets and activities can have the greatest impact in advancing Canada's national interests;
• cover both civil and military assets and activities;
• align with Canada's international partnerships and commitments;
• position the industry to take maximum advantage of emerging opportunities, for example, by extending Canada's lead in niche technologies; and
• be assessed annually in light of emerging circumstances.

Barring major developments that demand a change in course, 10-year and 5-year priorities should remain consistent over their lifespan, while annual priorities should reflect and build on 10- and 5-year priorities.

Once approved, priorities should be reflected in ministerial mandates, with the expectation that follow-through will occur in a timely manner. Where necessary, ministers should bring more detailed project proposals to Cabinet for approval. Approved priorities and projects should, of course, inform the government's budgeting process.

To help industry, researchers, and other interested parties plan their own work, a summary of approved Canadian Space Program priorities and projects should be released to Parliament and the public on an annual basis.

While there are many areas the government might wish to emphasize in its first set of Canadian Space Program priorities, the imperatives of development and security in the North should almost certainly be high on the list. Satellites and associated ground infrastructure are frequently the most cost-effective—and sometimes, the only—tools for unlocking the enormous wealth of the region; monitoring environmental conditions and impacts; allowing for communication among, and delivery of health and education services to, dispersed communities; ensuring that Arctic sea and air transportation are safe; protecting the northern perimeter; and asserting Canadian sovereignty.

In addition, the government should consider, when establishing priorities, how the country's launch capacity needs can be addressed. Canada's public and private sectors already face potential delays and extra costs as they wait in line for a spot on other countries' launch vehicles. Access to reliable launch capacity will become more important as increased use is made of space assets, including small satellites, to meet the country's economic, security, and public service delivery needs. While creating launch capacity alone is likely to be prohibitively expensive, joint efforts with close allies and/or nations confronting similar challenges may be a way of assuring that Canadian assets are near the front of the launch queue in the decades to come.

Finally, a first set of priorities should reflect how Canada will make full and strategic use of its right to access the laboratories and equipment of the International Space Station to advance cutting-edge Canadian research and technological development.

Recommendation 2: An Advisory Council

Space activities are like no other. They involve developing and deploying complex and often unique technologies into a hostile and forbidding environment where there is little or no possibility of second chances or repair and maintenance. As a result, determining what is feasible and desirable in the context of a national space program requires the experience and insights of a wide range of experts.

The most efficient way for government to gather this advice is to hear the unvarnished views of knowledgeable people around a single table. Such an approach can reduce the number of discussions that must take place, improve the quality of decisions, and offer invaluable input on the sorts of trade-offs that are essential in a resource-constrained world.

The Advisory Council should be mandated to advise the Minister of Industry on Canadian Space Program priorities and plans, taking into account factors such as:

• the current and potential niche strengths of the Canadian space industry and research community;
• emerging technologies with the potential for positive economic impacts through a wide range of applications in and beyond the space sector;
• public service delivery needs that can be efficiently met through the use of space assets; and
• opportunities for international cooperation on space-related initiatives.

It is important that the Advisory Council bring perspectives from outside government and across the country. It should, therefore, be chaired by a neutral, non-governmental appointee, and include among its members:

• industry representatives from large, medium-sized, and smaller firms;
• representatives of leading space-related research and academic programs;
• senior officials from the CSA and federal departments and agencies with space-related interests and activities, including those that use satellites to deliver their mandates and those that conduct or fund space-related research; and
• senior officials from provinces and territories interested in using space assets to deliver services in their jurisdictions.

It may be appropriate for senior government officials who participate in Advisory Council discussions to do so in an ex officio capacity, given that they have both an opportunity and obligation to provide policy advice to ministers through other channels.

Recommendation 3: Disciplined governance and implementation

Overall direction is only meaningful if properly implemented. Because space projects are complicated and often break new technological ground, they carry an inherent risk of false starts and unexpected detours. Experience illustrates this risk: major space projects in Canada and abroad have been bedevilled by project management issues, cost overruns, and missed deadlines. In such a context, rigorous governance and planning are a must. Once Cabinet has pointed the way, government departments and agencies must be properly organized to follow through.

A deputy minister-level Space Program Management Board—with the Deputy Minister of Industry serving as Chair and the President of the CSA as Vice-Chair—should be mandated by the Clerk of the Privy Council to ensure the coherence and coordination of federal space-related activities, once Cabinet has approved priorities. Support and advice to the Board should come from the CSA as well as the deputy ministers' own departments.

This Board, in turn, should implement arrangements to ensure that major projects are planned and executed in the most rigorous manner possible. It could, for example, strike project-specific steering committees comprising representatives of the CSA, federal departments and agencies involved in the project or initiative, interested provincial and territorial governments, and research institutions. Participation in such steering committees would normally follow a "pay-to-play" rule: those funding a project or initiative should have a voice in how it is designed and implemented.

To provide information on these activities to Parliamentarians and the public and to strengthen accountability, the Reports on Plans and Priorities and Departmental Performance Reports for the CSA and all departments and agencies involved in the Canadian Space Program should specify, in detail, how those organizations are implementing Canadian Space Program priorities. Effective delivery of space-related commitments should be considered in assessing the performance of relevant deputy ministers and senior managers.

Proposed governance structure for the Canadian Space Program

Recommendation 4: Predictable funding

In a field in which projects can take a decade to go from concept to operation, sustained funding commitments are essential. Budgetary uncertainty is a recipe for eroding value and increasing risk to the public purse, private industry, and the research community.

Funding stability requires an explicit assurance of continued support as long as activities and projects stay on track. It is not a blank cheque: where milestones are missed, the government must have the ability to use its financial authority as purchaser to compel better performance. Nor does it mean the federal government should be covering all required expenditures itself: given the cost and complexity of space assets, and the benefits of cooperation, multi-payer funding models will often be more appropriate than single-payer models.

Within those limits, however, predictability in long-term funding is essential to effective management and the success of a national space program.

Canadian funding sources for major projects may include:

• the CSA, whose core budget should allow it to make a modest contribution to each major project;
• federal departments, agencies, and research bodies that will use the asset or initiative to support delivery of their mandates;
• provincial and territorial governments that will make use of the asset or initiative;
• research and academic institutions interested in using the asset or initiative as a platform for conducting research;
• the builders and operators of the asset, through public-private partnership arrangements; and
• special allocations from general government coffers, in the same manner as such allocations are made for infrastructure projects such as bridges and ports.

Figure 11: Core budget of the Canadian Space Agency – 2001-02 to 2012-13

The domestic funding formula for each project should reflect considerations such as the nature of the project itself, the capacity and willingness of potential users to make a contribution, and the overall fiscal situation. Special allocations from government coffers may be more appropriate in the early stages of a project's lifecycle, when required expenditures may outstrip users' ability to pay, but should decline over time. This would be consistent with funding patterns for many types of basic or developmental infrastructure.

In some cases, international cooperation will be critical to seeing a project to fruition and to its long-term operational success. Canada has a history of working closely with other countries on space initiatives—a history that has allowed it to strengthen its international visibility and relationships, establish a global reputation for niche technological strengths, and gain access to multi-billion-dollar assets, like the International Space Station and the Mars Curiosity rover, that it would never have been able to develop and build on its own.

Canada's reputation as a dependable and sophisticated collaborator positions us well for deeper cooperation with:

• traditional partners NASA and the ESA, which remain the world's largest space agencies;
• emerging (or re-emerging) space powers such as Russia, China, India, Brazil, and Japan—where export controls complicate cooperation with these countries, joint efforts can be focused on areas that are not security-sensitive; and
• Arctic Council members, who are likely to share Canadian interests in developing satellites, ground stations, and small satellite launch capacity to support economic development, safe transportation, public service delivery, and environmental stewardship in northern regions.

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