Some military analysts have speculated the $35-billion shipbuilding procurement strategy — of which the largest contract, $25 billion, was awarded to Halifax in October — has hit a wall. No final contracts have been signed.
This, combined with $2 billion being cut from the Defence Department budget, has fuelled speculation that the shipbuilding project will be scaled back.
But a government employee directly involved in the shipbuilding negotiations said the value of the work will not go down.
“Absolutely not,” said the staffer, who asked not to be named.
“I’m not aware of any change in the size or scope of the project, and believe me, I would be aware.”
But rising costs could lead to one of three options:
Fewer ships could be built.
The same number of ships could be built but with fewer bells and whistles.
The government could decide to allocate more money to shipbuilding midway through the three-decade life of the contract.
So far, the staffer said, the number of ships is expected to be within the original range.
For example, the shipbuilding strategy called for six to eight Arctic patrol vessels. Getting eight is unlikely, but building six or seven is still seen as doable.
Chris McCluskey, spokesman for Associate Defence Minister Julian Fantino, confirmed that budget cuts would not affect the shipbuilding contracts.
“Media reports suggesting that our shipbuilding strategy is affected by deficit reduction measures are incorrect,” McCluskey said.
On Feb. 14, the government signed umbrella agreements with Irving Shipbuilding, which owns the Halifax Shipyard, and Seaspan, which operates the British Columbia yard that landed an $8-billion contract, the second-biggest. However, the actual contracts have not been signed.
Retired rear admiral Ed Healey, who oversaw the acquisition of Halifax-class frigates in the 1980s, told the Ottawa Citizen that the Harper government gave away all its leverage by selecting the shipyards before it started negotiations.
But Ottawa specifically included a provision to be able to move parts of the contract from Nova Scotia to B.C. or vice versa if negotiations get tough.
“We’re not stupid,” the source said.
In the House of Commons on Tuesday, Halifax West Liberal MP Geoff Regan asked how shipyard workers could have any confidence in the government’s job promises.
Public Works Minister Rona Ambrose responded that she has “every confidence” that Irving and Seaspan will get the ships built on time.
Original Article
Source: the chronicle herald
Author: PAUL McLEOD
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