Strategic Review (SR) and Deficit Reduction Action Plan (DRAP) - DPR - 2013-14

Strategic Review (SR) and Deficit Reduction Action Plan (DRAP)

Priority – Ensuring Defence Affordability

Implementing the Strategic Review and Deficit Reduction Action Plan. These initiatives are focused on eliminating low performing and low priority activities and on generating savings though more efficient ways of delivering the Defence program. Together, they represent a savings of $1,682M for fiscal year (FY) 2013-14.

Strategic Review (SR): Defence examined 100% of its program and determined the bottom 5% of low priority or underperforming activities for a total divestment of $989M. The divestments are grouped into three categories: increasing efficiency and effectiveness, focusing on core role and meeting the priorities of Canadians.

• Financial: Implemented over the course of two years, a $525M reduction was implemented in FY 2012-13 and the full reduction in FY 2013-14 and onwards.
• Implementation Status: In FY 2013-14, approximately 60% of the activities were completed, demonstrating full savings. Due to complexity and dependency on external factors, some of the initiatives have experienced delays. It is expected that approximately 90% of the SR activities will be complete with savings generated by the end of FY 2014-15. An alternative savings proposal (capital equipment) was developed to cover initiatives that either were not accepted by Treasury Board Ministers or for which savings did not materialize. Following a rationalization of the capital equipment program, this program was reduced by $154M.

Deficit Reduction Action Plan (DRAP): While SR centered on divesting low performing or low priority programs, DRAP focused on savings through efficiencies. Defence’s DRAP plan consists of 9 broad initiatives, many of which are linked to the Report on Transformation 2011. Implemented over three years, these initiatives will save $1.1B by FY 2014-15.

• Financial: Defence’s DRAP reductions amounted to $692M in FY 2013-14.
• Implementation Status: The Department has set specific performance measurements to monitor the implementation of DRAP initiatives. A Corporate commitment has been made to support initiatives to improve the productivity, efficiency and effectiveness of operations and service delivery, to transform business practices and to identify savings. Of the nine initiatives, seven successfully completed all activities in FY 2013-14 with the remaining two commencing implementation on 1 April 2014. Defence is on track for personnel reductions, both civilian employees and full-time Reserves and in reducing expenditures related to contracting. One initiative, efficiencies relating to National Procurement, has successfully achieved full savings one year early.