Construction of new Canadian warships to begin in June

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Initial construction of the first of the new Canadian warships, estimated to cost up to $80 billion, will begin in June, although an actual contract to build the vessels has not yet been signed.

National Defense procurement chief Troy Crosby recently told MPs that low-rate production activities for the Canadian Surface Combatant will begin sometime next month. That will include construction of a small section of the ship’s first structure at Irving Shipbuilding on the East Coast.

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That work continues even though the Canadian government has not yet signed the construction contract to begin building the 15 warships.

National Defense spokesperson Kened Sadiku explained that the contract to build the first ships, known as the implementation contract, will not be awarded until the end of this year or early 2025.

But under the current agreement, low-cost production activities on the ships are covered and the construction of a small section allows construction techniques to be further refined. “Full production is expected to begin under an implementation contract in 2025,” Sadiku said.

The first completed CSC was originally due to be delivered in the early 2020s. But in February 2021, National Defense admitted that delivery of the first ship would not occur until 2030 or 2031.

The project has already faced significant cost increases from the original estimated price of $26 billion. Parliamentary budget manager Yves Giroux now estimates that the cost of the ships is around $84 billion.

National Defense maintains that the cost will be between $56 billion and $60 billion, and its officials have insisted that figure will not increase.

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Critics have called the CSC project, the largest purchase in Canadian history, a bottomless money pit with little accountability or oversight. Since the construction contract has not yet been signed, they have asked that the project be stopped or at least reviewed.

National Defense remains adamant that it will not alter course and that the project, which will acquire ships to replace the current Halifax-class frigates, is a success so far.

Conservative MP Kelly McCauley said he and other MPs believed the construction of the CSC alone would eventually cost more than $100 billion.

This newspaper reported on January 24 that National Defense has covered a new, unprecedented cloak of secrecy around CSC costs.

After withholding documents for nearly three years, the department released nearly 1,700 pages of records that were supposed to describe specific costs and work done so far in the CSC program.

But all details of what taxpayers have spent so far and what kind of work Irving Shipbuilding has done with that money were redacted from the records.

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In an April 8 appearance before the Senate defense committee, Crosby pointed out current problems with Arctic and offshore patrol vessels being built for the Royal Canadian Navy. He testified that National Defense’s handling of those issues “gives me great confidence in our ability to take on the much more complex delivery of the Canadian Surface Combatant in the coming years.”

As Postmedia previously reported, the CSC program was presented as a relatively low-cost, plug-and-play replacement for the Halifax class of warships with a high level of Canadian industrial content.

But, over time, the navy has requested changes that have frequently replaced Canadian-built content with American technology, the net effect being the loss of hundreds of millions of dollars to the Canadian industry and an increase in overall cost, the Postmedia report.

As costs increased, federal officials also made it more difficult to obtain details about spending on the project.

Federal officials have twice attempted to stymie the Parliamentary Budget Officer’s attempts to obtain details and budget outlines for the CSC project, as well as those for other shipbuilding programs under the government’s National Shipbuilding Strategy.

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Industry executives have previously noted that the secrecy is not based on security concerns, but rather concerns that the media and opposition parliamentarians could use the information to closely monitor the military procurement system plagued by issues.

David Pugliese is an award-winning journalist who covers the Canadian Forces and military issues in Canada. To support his work, including exclusive subscriber-only content, sign up here: ottawacitizen.com/subscribe

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