OTTAWA — The Harper government has moved to blunt expected criticism of the navy’s delayed supply ship program and its marquee shipbuilding strategy.
Senior officials at Public Works, who oversee the National Shipbuilding Procurement Strategy, held a briefing Wednesday ahead of the release of a report today by parliamentary budget officer, Kevin Page.
The watchdog’s report will say the program to replace the navy’s 45-year-old joint supply ships is not affordable given the inadequate $2.6 billion set aside by the government.
But senior Public Works officials, who spoke on the condition that their names not be used, insisted the program remains on track to deliver two, possibly three ships by 2018-19.
The joint supply ships budget includes a 15 per cent contingency, of about $300 million, and has an escalation factor of 2.7 per cent for ship construction costs, an official said.
National shipbuilding projects go through assessments to ensure the budget can deliver what’s needed, he said. For the joint supply ships, the next checkpoint is part of the ongoing design selection process, which includes an independent third-party review. “At this point in our review cycles, the [joint supply ships] project remains affordable.”
The favoured design is expected to be chosen this spring among two being considered.
The design then goes to the shipyard to be developed to a “production-ready” state.
As that takes place, construction estimates are refined, he said. During this stage, design trade offs may take place to keep the project affordable.
Vancouver-based Seaspan Marine Corp. won the right in 2011 to negotiate $8-billion worth of contracts to build federal non-combat vessels, including the supply ships. Seaspan, owner of Vancouver Shipyards and Victoria Shipyards in Esquimalt, is investing $200 million in infrastructure to prepare for upcoming work.
Plans call for the majority of the work to be carried out in Vancouver, with ships brought to Esquimalt for the remainder of construction, tests and trials.
Last week, a total of $15.7-million in federal contracts were announced with Seaspan. Funds go to planning and assessment of designs of the joint supply ships, a review of a polar icebreaker design, and to refine design and specifications for an offshore fisheries science vessel, as well as producing construction plans and figuring out what’s needed in materials, labour and sub-contractors.
Page’s stinging criticism of the F-35 stealth fighter ignited a political controversy that ultimately resulted in the Conservatives’ re-examination of the multibillion-dollar program.
The navy supply ships were first ordered by the Paul Martin government in 2004, but initial proposals by shipyards were deemed too expensive by the Harper government in 2008.
The program was forced to go back to square one with a drastic scaling back of the capabilities the navy wanted for the ships.
Page’s report is expected to show that when inflation is factored in, the new, less capable ships will cost more than if the government had stuck with the original plan.
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