The Centre for Policy Alternatives and the Rideau Institute say the $4.3-billion plan has been watered down to the point where it no longer makes much sense, and the country would be better served building high-speed navy cutters and civilian icebreakers.
The Conservatives promised the arctic warships during the 2006 election campaign, saying once in government they would build three heavily armed icebreakers to enforce Canadian sovereignty in the North.
In 2007, the plan changed to up to eight light "ice capable" ships, including a major refuelling station in Nanisivik, Nunavut.
The report by researchers Michael Byers and Stewart Webb chronicles the delays and compromises in ship design, which were made to stay within budget.
The ships, as currently configured, will be too slow, too unstable and too lightly armed, they conclude.
In addition, much like the navy's long-promised supply ship program, delays are eating into the buying power of the government's original arctic warship budget.
"The capabilities of the (arctic ships) have already been pruned due to fiscal restraints," the report says.
"The ships will be smaller than originally planned, which limits their range, their ability to operate in ice, and their ability to deploy a helicopter in moderate or heavy seas."
Defence Minister Peter MacKay dismissed the report and the notion of scrapping the program, describing the latter as a "hair-brained" idea.
The government has already invested considerable time and design money to develop the new ships for the navy, MacKay said in an interview with The Canadian Press.
"I see this as more torqued rhetoric from a guy who claims to be independent, but is in fact a failed NDP candidate," he said — a reference to the fact Byers ran unsuccessfully for the federal New Democrats in Vancouver Centre in 2008.
MacKay defended the design changes, saying Byers is offside with his own party, which is in favour of creating shipbuilding jobs in Canada. The ships' capability is still under development, he added.
Byers said it was unfortunate the minister chose not to respond to the substance of the report.
"Nothing in our report suggests that new Navy ships should not be built. Rather, our concern is that the money and jobs go towards building the right ships, not the wrong ones -- as currently planned." said Byers.
The report says the government would be better served by buying high-speed patrol boats for the navy based upon a proven design, such as the Australian Armidale class.
Those ships could operate in both the Atlantic and Pacific Oceans, leaving the coast guard to focus on the Arctic.
"Given the limited ice capabilities of the (arctic ships), it is foreseeable that coast guard icebreakers might need to accompany them on particular missions," said the report.
"The possibility of having to send two ships worth hundreds of millions of dollars each to deal with a single non-state security threat, such as a drug smuggling or illegal immigration incident, defies logic — given the vastness of the Canadian Arctic and the obvious efficiency of sending a single vessel with a full range of the necessary capabilities."
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