SUPPORT US

In The Media

VIDEO: New plan for warships will likely hit $40 billion price tag: defence analyst

by Marieke Walsh (feat. David Perry)

Global News
June 14, 2016

The federal government’s plan to find an off-the-shelf design for its new set of warships won’t keep the budget under the initial price tag, says one senior defence analyst.

David Perry, senior analyst with the Canadian Global Affairs Institute says the initial $26 billion price tag for 15 warships announced in 2015, was “unrealistic” and remains so even with Monday’s changes.

Perry says the government is “not going to be able to deliver 15 ships for under $26.2 billion.”

“The general type of warship that the Canadian navy needs is going to be somewhere in the $40-50 billion ballpark if its going to be 15 ships,” Perry said.

At the Irving shipyard announcement, Public Services and Procurement Minister Judy Foote refused to give a new budget estimate along with the government’s new plan to drop some of the ships’ requirements.

“For me to stand here and suggest that it’s going to be one cost or another would be really unfair and irresponsible,” Foote said.

Instead, the government says it will finish the competitive process to find a design before announcing a new budget for the surface combatants. Despite the lack of details, Foote said the changes will come with “some cost savings for Canadians.”

Choosing the off-the-shelf model is expected to shave two years off the shipbuilding project’s timeline, Foote said.

It also means construction for the warships will start as soon as the construction for the Arctic Offshore Patrol Ships is complete. The two types of ships are both being built at the Irving shipyard.

In part, the government will save money through the faster timeline because it means it’s paying  two years less for high inflation rates for equipment needed to build ships, Kevin McCoy, president of Irving Shipbuilding, said.

Shipbuilding inflation ranges from 4-5 per cent a year, McCoy said.

“You’re essentially saving 10 per cent of the cost if you can knock two years off the time period.”

The warships will replace the navy’s ageing Halifax-class and Iroquois-class ships. Construction will start in 2020 and its expected to take 20-25 years to build all of the ships in the program. However, the government isn’t saying yet how many ships it will build — only saying the number could go as high as 15 surface combatants but not setting a floor.

“Maybe we’ll be able to accomplish what we need to accomplish with fewer ships,” Foote said.

Foote’s hedging on how many ships will be built is a change from the Liberals’ election pledge to build all of the ships originally promised when the shipbuilding strategy was announced in 2011.

Speaking to a crowd in Halifax in September, then Liberal candidate Justin Trudeau said if he won government he would ensure “that the national shipbuilding strategy is actually able to complete all the ships promised.”


Be the first to comment

Please check your e-mail for a link to activate your account.
SUBSCRIBE TO OUR NEWSLETTERS
 
UPCOMING EVENTS

CONFERENCE
Annual Defence Procurement Conference

Ottawa, Ontario

October 25, 2022

SEARCH
EXPERTS IN THE MEDIA

Oil: Forget Year-End Forecast Of $65; Will We Get To $85 Soon?

by Barani Krishnan (feat. Amrita Sen), Investing.com, July 6, 2022

Russia Ukraine Update

by David Gray and Angela Knight (feat. Colin Robertson), CBC Radio One, July 6, 2022

Arctic waters have always been in Russia's interest

by Bloomberg Commodities Staff (feat. Rob Huebert), BNNB, July 6, 2022

Canada’s Approach to the Indo-Pacific

by Deanna Morton (feat. Jonathan Fried and Meredith Lily), CPAC, May 10, 2022

Oil to Remain Above $80 Even With a Recession

by Business Desk (feat. Amrita Sen), Global Herald, July 5, 2022

Sweden, Finland entry to NATO ‘not done deal,’

by Heather Hiscox (feat. Andrew Rasiulis), CBC News, July 5, 2022

Exclusive-China plans $75 billion infrastructure fund to revive economy

by Xiangming Hou and Kevin Yao (feat. Amrita Sen), Reuters, July 4, 2022

À long terme, l’avantage est toujours à la Russie

by Violette Cantin (feat. Ferry de Kerckhove), Le Devoire, July 4, 2022

Pan-Canadian Policy Table

by Alain Gravel (feat. Jean-Christophe Boucher), Ici Radio Canada, July 2, 2022

La place du Canada sur la scène internationale

by Hugo Lavoie (feat. Jocelyn Coulon), Tout un Matin, July 1, 2022


LATEST TWEETS

HEAD OFFICE
Canadian Global Affairs Institute
Suite 1800, 150–9th Avenue SW
Calgary, Alberta, Canada T2P 3H9

 

OTTAWA OFFICE
Canadian Global Affairs Institute
8 York Street, 2nd Floor
Ottawa, Ontario, Canada K1N 5S6

 

Phone: (613) 288-2529
Email: [email protected]
Web: cgai.ca

 

Making sense of our complex world.
Déchiffrer la complexité de notre monde.

 

© 2002-2022 Canadian Global Affairs Institute
Charitable Registration No. 87982 7913 RR0001

 


Sign in with Facebook | Sign in with Twitter | Sign in with Email