More on the major warship contract

David Pugliese, writing in the Ottawa Citizen, says that “The Liberal government is pushing ahead to try to get the Canadian Surface Combatant deal signed with Irving and the Lockheed Martin-BAE consortium either Thursday or Friday, sources say … [and, he adds] … That $60 billion project will see the eventual construction of 15 warships in the largest single government purchase in Canadian history.

Type_26_CapabilityThe Lockheed Martin and BAE team, Mr Pugliese says, “is offering Canada the Type 26 warship designed by BAE in the United Kingdom … [a class of warship that will also be procured, in small quantities, by the Australian and British navies, and] … Irving is the prime contractor and the vessels will be built at its yard on the east coast.

He reports that “Public Services and Procurement Canada did not respond to a request for comment … [on the somewhat hasty contract signing, but] … some industry representatives are questioning why the government is moving so quickly to get the contract signed. They say with a deal of such financial size – and potential risk to the taxpayer – federal bureaucrats should move slowly and carefully.” I suspect that part of the answer might lie in:

  • The recent decision by the Canadian International Trade Tribunal to dismiss a challenge by one of the companies that was competing for the job ~ which I suspect has given the bureaucrats and their political masters some confidence in the strength of the evaluation process and decision, and they, likely, want to move, decisively, even as there are going to be further legal challenges, according to CBC News, because they want to keep Irving’s workers busy; and
  • The bureaucrats are comfortable because the Type 26 has been selected by two other allied navies.

David Pugliese explains that “The entry of the BAE Type 26 warship in the competition was controversial from the start and sparked complaints the procurement process was skewed to favour that vessel. Previously the Liberal government had said only mature existing designs or designs of ships already in service with other navies would be accepted, on the grounds they could be built faster and would be less risky. Unproven designs can face challenges as problems are found once the vessel is in the water and operating … [but, he says] … that criteria was changed and the government and Irving accepted the BAE design, though at the time it existed only on the drawing board. Construction began on the first Type 26 frigate in the summer of 2017 for Britain’s Royal Navy, but it has not yet been completed.” It is certainly true that unproven designs can face technical, operational and financial challenges, but it is also true that new designs often address flaws in other, more mature contending systems. The decision to only go with a mature, proven design is one that I have, generally, preferred in the systems with which I was concerned, but that may reflect a cautious, conservative nature … some of my friends who were very bright and accomplished engineers chose new technology for their projects and they often turned out just as well as, and even better than mine.

The Canadian Surface Combatant program has already faced rising costs,” Mr Pugliese says, explaining that “In 2008 the then-Conservative government estimated the project would cost roughly $26 billion. But in 2015, Vice-Admiral Mark Norman, then commander of the navy, voiced concern that taxpayers may not have been given all the information about the program, publicly predicting the cost for the warships alone would approach $30 billion,” and subsequently the government has projected that the full, lifecycle costs for 15 ships will be about $60 Billion. My concern, which I have expressed before, is that Canada really needs about 25 surface warships, not 15, and the large Arctic Offshore Patrol Ships are ‘constabulary’ vessels, not warships. Thus I remain convinced that the Royal Canadian Navy needs 10 to 15 of the Type 26 vessels and another 10- to 15 smaller but still well armed corvettes.

Some analysts have said (in the CBC News link, above) that “the process was deliberately structured so that the navy got the ship it needed, not the cheapest one.” If that is the case then it may be that the process was, in fact, properly structured and the government is right to move forward, now, despite the potential court challenges. If the process was designed to get what’s really needed then it might be a rare ray of sunshine in an otherwise cloudy defence procurement system.

But we must remember that the entire government shipbuilding scheme is all about rebuilding our domestic shipbuilding capacity, not, really, about building warships or Coast Guard vessels. There is, without doubt, a political ‘requirement‘ to keep Irving (and Seaspan, on the West coast) busy and to keep workers on the job … that may make awarding a contract very urgent in an election year.

I believe, based on what I’ve read and heard ~ warships are not my area of expertise, that the Type 26 is a good fit for Canada’s needs, and I am hopeful that Irving can build 15 within the budget allowed ~ about $2 Billion per ship, which seems to be about double what most other countries are willing to pay.

2 thoughts on “More on the major warship contract

  1. Strange how the Type 26 meets the requirement when it is unproven in any service, but the F-35 accepted by all our major allies ‘doesn’t work’. I would simply like some degree of consistency. Also as Roger Sashaw pointed out the news release said that the Type 26 met the government’s requirements, nothing about meeting DND’s or the RCN requirements which I take to mean it is being built by Irving.

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