Jura The idiot
General
I noticed they had noticed in Australia Canada commits $60b for 15 new navy ships
June 11, 2017
June 11, 2017
As part of its long-awaited defence policy report, Canada has committed to building all 15 surface combatant ships at a projected cost of up to $60 billion. “This plan fully funds for the first time the Royal Canadian Navy’s full complement of 15 Canadian Surface Combatant ships necessary to replace the existing frigates and retired destroyers,” Defence Minister Harjit Sajjan said.
The number of new warships to be constructed in Halifax by prime contractor Irving Shipbuilding under the government’s massive shipbuilding strategy has been the subject of speculation since the program was announced. Before Wednesday, the official commitment has been “up to 15” ships. Concerns were renewed last week when the parliamentary budget office released a report saying 15 ships would cost taxpayers $61 billion, more than double the $26 billion originally budgeted by the Conservative government that launched the program. Last year, Ottawa moved away from that number, saying costs were too uncertain at this stage in the procurement process.
According to supplementary documents provided during Wednesday’s report release, as part of the review, DND conducted a year-long re-costing of the surface combatants including “private sector firms as well as international experts, such as the U.S. Navy.” Based on this review, the department said, the cost of 15 ships is projected to land between $56 billion and $60 billion. In the policy report, the government promised to provide $17.5 billion to fund equipment projects for the Royal Canadian Navy over the next 20 years ($53.5 billion on a cash basis), including $14.6 billion to fully fund planned equipment projects. The report says this includes sufficient funding to acquire all 15 Canadian navy ships. However, with delivery of the first ship not scheduled until 2026 and the vessels expected to be in service more than 30 years, much of the predicted $56 billion-$60 billion cost of the project will be spent after the 20 years covered by the policy.
Irving will be paid by the government throughout the build process based on the completion of the vessels. In an emailed statement to the Chronicle Herald, Irving president Kevin McCoy said he applauds Ottawa for establishing a new defence policy and allocating additional resources to ensure Canada’s Armed Forces have the tools and equipment they need to operate effectively. “The government’s commitment to the national shipbuilding strategy and its two partner shipyards is a clear signal that Canada’s shipbuilding industry is being revitalized and Canadians are benefiting from coast to coast to coast,” McCoy said.
Public Services and Procurement Canada requested proposals for the new warships. Just this week the department extended the deadline for the second time for the 12 prequalified firms to submit a combined bid on an existing ship design and combat systems integrator. Though the number of warships to be built has finally been solidified, there are still question marks surrounding how many Arctic offshore patrol ships, also being built by Irving, the government will deliver. On Wednesday, the government committed to building five to six ice-capable ships under the program. The official navy website for the AOPS project still says six vessels will be built, and official phrasing in press releases and announcements has shifted between six and “up to six” in the past few years.
The name of the sixth ship has not been announced yet. The reason for this uncertainty is due to how the contract with Irving is structured to include incentives to keep shipbuilding costs down and deliver six ships within a ceiling price, according to information on DND’s website. If costs increase due to unforeseen factors, the contract guarantees the delivery of five ships within that same ceiling price. “If five ships are delivered to the Department of National Defence, the navy will still have a well-equipped fleet capable of carrying out its missions and operations. However, this could result in reallocating frigate resources to supplement Arctic and offshore patrol ships, as required,” the site reads.