The military is boarding up an intelligence office on the West Coast less than two years after the navy argued it needed more surveillance in a region considered a prime thoroughfare for human smuggling.

The Acoustic Data Analysis Centre at Canadian Forces Base Esquimalt, B.C., will close as part of a three-year drive to carve $1.5 billion from the budget of National Defence.

Operations will be transferred to a similar centre in Halifax, which has been in the middle of a continuing spy scandal involving navy intelligence officer Sub-Lt. Jeffery Delisle.

The navy refused to discuss specifics of the closure, declined interview requests and issued a terse statement that the centre's loss would not have an impact.

"This consolidation will achieve cost savings for the Canadian taxpayer while having no impact on the ability of the Canadian Forces (CF) to meet operational objectives in the delivery of naval intelligence capability," said the statement, issued to The Canadian Press.

Intelligence centres for each coast

As the navy attempted to beef up intelligence during the last two years, it determined that two centres — one on each coast — were important to "divide the world in half for intelligence analysis," said a Sept. 1, 2010, presentation involving the director of maritime strategy.

The report warned that under a centralized approach, maritime intelligence analysts did not have "a region or functional area of expertise" and the lack of finesse made things "very inefficient and time consuming."

Apart from human smuggling, a hot-button political issue, the military has focused on the possibility of weapons of mass destruction — chemical, nuclear or otherwise — slipping into the country through porous coastlines.

Wesley Wark, an intelligence expert at the Munk School of Global Affairs at the University of Toronto, said having analysis centres on both coasts was a point of pride for the federal government in the 2004 national security strategy, in the aftermath of the 9/11 terrorist attacks.

The navy argues that new technology makes it easy to centralize those operations out of Halifax, and the centre in Esquimalt was offered as part of cost-cutting.

But Wark said if that's the case it would make more sense to consolidate everything in Ottawa alongside the country's other intelligence agencies, where they could talk more frequently to one another.

The capacity to monitor what's going on in the world is divided across at least nine government departments and agencies, including the military, the Canadian Security Intelligence Service, Transport Canada and the RCMP.

The Communications Security Establishment, a secret, high-tech eavesdropping section of National Defence, is getting more money and being made a stand-alone organization, but elsewhere there are reductions.

Treasury Board President Tony Clement said Wednesday the government would not proactively release a list of budget cuts.

Wark said he suspects intelligence will suffer because people don't know its successes, and bureaucrats often can't see its value.

Intelligence spending needs strategic thinking

"Not that the intelligence community should be considered special compared to other government operations, but cuts without a strategic sense of their cumulative impact are a very, very bad idea," he said.

"The intelligence community cannot adapt very well to a boom-and-bust cycle."

Some of the boom since 2001 has been to fill in gaps that emerged in the 1990s with the end of the Cold War.

"I'm very worried about the lack of strategic thinking behind all of this because at the end of the day Canada wasn't well prepared for a post-9/11 world, we had to make investments, governments of the day understood that. The need for those investments hasn't gone away," said Wark.

The internal defence reports also warned that the navy's information-gathering capability and voice was not "well linked or centrally co-ordinated" and that military's chief of intelligence has only a "modest" investment in maritime intelligence and no mandate to do more.