POLITICS

Canada Shipbuilding Program: Harper Expected To Announce Details Of $35-Billion Program

01/11/2012 06:02 EST | Updated 03/12/2012 05:12 EDT
CP
HALIFAX - The prime minister is expected to announce agreements Thursday that will govern the Halifax and Vancouver shipyards through the lifetime of the deal to build Canada's next fleet of navy ships, The Canadian Press has learned.

Stephen Harper will make announcements at the two shipyards Thursday, three months after they were chosen by Ottawa to build the vessels under its $35-billion shipbuilding program.

Harper is expected to announce details of umbrella agreements that are intended to assign the roles and responsibilities of the federal government as well as those of the shipyards, senior defence and industry sources say.

The sources, who spoke on condition of anonymity, said the first order for the Irving shipyard in Halifax will likely be for a new Arctic offshore patrol ship.

But Harper isn't expected to announce any specific ship projects.

As winner of the $25-billion combat ship contract, the Irving shipyard will be responsible for building 21 vessels. Seaspan Marine Corp. in Vancouver will construct seven vessels under an $8-billion agreement to build non-combat ships.

Another $2 billion for smaller vessels is yet to be allocated to another shipyard.

Ottawa's goal in rolling out the national shipbuilding procurement program is to end the boom and bust cycle that has hampered shipbuilding in Canada in the past. The industry has struggled since the last major warship project ended in the 1990s.

The plan aims to see a steady flow of work over the next 20 to 30 years in order to sustain highly skilled jobs.

Negotiations are expected to continue in the coming months on specific contracts, and Irving has already indicated that it hopes to begin cutting steel on its first new vessel by the end of this year.

The navy would like to see the Vancouver yard handle the contract for the new joint support ships to replace its 40-year old supply vessels. But it hasn't settled on a design, meaning a coast guard order would likely be filled first.

The procurement has been hailed by government and opposition MPs alike for its arms-length process.

The Harper government promised to keep politics out of the process by having four senior bureaucrats evaluate the bids, and hiring a fairness monitor and an accounting firm to ensure an unbiased selection process.

Politicians were even cut out of the October announcement on the winning bids, which was delivered by the deputy minister of Public Works.

The process could serve as a model for future military procurements, which have for years been plagued by delays and cost overruns.