Thursday, May 02, 2013

Peter MacKay's Hole in the Ocean

Sailors often complain that a boat is merely a hole in the ocean into which you pour money.   This brings us to Harper DefMin, Peter MacKay's 250-million dollar hole in the ocean.

CBC News is reporting a quirky deal surrounding Canada's Arctic offshore patrol vessel programme.  And, yes, it involves not only MacKay but Harper hairpiece Rona Ambrose also.

Public Works Minister Rona Ambrose and Defence Minister Peter MacKay announced March 7 in Halifax that Ottawa will pay Irving Shipbuilding $288 million just to design – not build – a fleet of new Arctic offshore patrol ships.

Irving will then build the ships under a separate contract.

However, a survey of similar patrol ships bought by other countries shows they paid a fraction of that $288 million to actually build the ships – and paid less than a tenth as much for the design.

In addition, the design of Canada's new ships is based upon a Norwegian vessel whose design Ottawa has already bought for just $5 million.

So, we already bought the design for the underwhelming sum of $5-million but we're going to pay Irving Shipbuilding almost $300-million to design the ship we already have the designs for.  And, even starting from scratch, the design for this sort of vessel should come in at around $30-million, tops.   And, worse yet, you should be able to design and construct these ships for under $300-million.

The Norwegian ship, the Svalbard, was designed and built for less than $100 million in 2002.
Experts say the design price is normally 10-20 per cent of the total cost of the ships.
Another country with Arctic interests, Denmark, acquired two patrol ships for $105 million in 2007.
They have modest ice-breaking capability, similar to the Canadian project, which allows for the ships to crunch through "summer ice" – about one-metre thick.
The Irish navy now is building two offshore patrol ships for $125 million.
In all cases, these prices include the design.

When CBC went after the MacKay/Ambrose brain trust for explanations, Ambrose went full Michelle Bachmann and said speak to her officials who, in turn, couldn't explain it.  MacKay meanwhile went all brain dead and said the "other shipyards are wrong."   They're "wrong", that's it Pete?

Ambrose got completely spinny, babbling on about the new, Canadian way of designing ships.

"We are implementing what's called a design and then build strategy," the minister told CBC News. "What that means is that we are spending more money up front on the design and production phase. That's important because we want to make sure that the shipyards, and the navy, and the coast guard, get the design correct."

However, Ambrose did not cite any other country that fails to design first and build later. Interviews with both Ambrose and her officials were interrupted by government media handlers who cut off further questions.

Fancy that, we're going to design the ships before we build them!  What a radical but brilliant concept, Rona.  Now go spray your hair.

My guess?   The Conservatives are using tax dollars to rebuild Irving's shipyard only the Canadian taxpayers aren't going to wind up owning what they've paid for.   No, that'll be a gift for the Irvings who, after all, really need the money.  At least that's my guess.


Anonymous said...

Anon 1

Then there's that matter of a $304 million loan from the Prov. of Nova Scotia to renovate their shipyard in Halifax.

Approx $260 million of that is a non repayable loan.

Irving is the greatest sucker of Corporate welfare Eastern Canada has ever known imo.

"Irving said the company needed provincial support to be the winning bidder for the federal $25-billion shipbuilding contract to build 21 combat vessels."

Also, it appears CBC edited their story and excluded an earlier reference to Lockheed Martin. From Google search page;

"The price of the province's $260-million loan to Irving Shipbuilding will be forgivable if the shipyard and its direct sub-contractors, including Lockheed Martin, create 4000 jobs in Nova Scotia, CBC News has learned. ."

The Mound of Sound said...

Interesting. Thanks.

Anonymous said...

The Irvings need to be rewarded for keeping everyone in line especially in the province of N.B.