The Liberals want to ‘refresh’ the shipbuilding strategy

The federal government has been quietly debating a “refresh” of its marquee — but troubled — national shipbuilding strategy, federal documents reveal.

A memorandum to the deputy minister of Finance, obtained by CBC News under access to information legislation, notes there was “tangible progress” in ship construction last year, but also references impending production gaps at the two designated shipyards: Irving-owned Halifax Shipyard and Seaspan in Vancouver.

The size and scope of the “policy refresh” was not made clear in the heavily redacted memo, dated Jan. 23, 2018. Officials at Public Services and Procurement Canada were asked to explain, but did not produce a response by Tuesday evening.

As recently as last week, government officials were insisting they were still committed to the strategy.

During the last election campaign, the Liberals pledged to fix the “broken” procurement system and invest heavily in the navy.

Conceived under the Conservatives but embraced by the Liberals, the national shipbuilding strategy has been plagued by delays and ballooning cost estimates in the building of both warships and civilian vessels.

Critics have long complained it would be cheaper and faster for Canada to buy offshore from foreign competitors.

It also remains unclear whether the build-in-Canada provision that is at the heart of the strategy is up for consideration in the reset.

Much of the icebreaking fleet belonging to the coast guard is in need of replacement — a critical gap that led the government recently to set aside $610 million for the refurbishment of three commercial ships.

Similarly, the navy has been forced to lease a replenishment ship because of delays associated with the Joint Support Ship program.

Confidential sources in the defence community said the review is being driven partly by a yet-to-be completed assessment of the coast guard, which has — according to a 2015 statutory assessment — among the oldest coast guard fleets in the world.

The retooled policy is expected to be ready this fall, the sources said, and will also encompass updated budget estimates and timelines for delivery.

Last spring, CBC News reported the federal government had received a revised delivery schedule for vessels being constructed at Seaspan. But it refused to release it.

The new timetable, which apparently forecasts delays outside of the company’s control, is politically sensitive. It speaks to issues at the heart of the breach-of-trust case against Vice Admiral Mark Norman, the military’s second-highest commander — in particular, the program’s inability to deliver ships in a timely manner.

The new questions about the future of the strategy come just days after Irving Shipbuilding issued a terse public statement, asking the federal government to clarify comments by Steve MacKinnon, the parliamentary secretary to the public works minister.

While unveiling the icebreaker deal on Friday, officials with Chantier-Davie, the company doing the refurbishment, suggested it would now be able to bid on projects under the shipbuilding strategy.

MacKinnon described the Levis, Que., yard as a solid partner in the system. But under the shipbuilding strategy, the Davie yard is allowed to bid on repair and refit work — not on construction of new vessels.

“The men and women of the Halifax Shipyard are concerned that these remarks signal the possible redirection of shipbuilding work out of Atlantic Canada,” Irving Shipbuilding said in a written statement, issued late Monday.

“We call upon the federal government to confirm to Irving Shipbuilding, our shipbuilders and their families, the Province of Nova Scotia, and all Atlantic Canadians that the National Shipbuilding Strategy remains intact and, therefore, construction of the ships for Canada’s Navy and Coast Guard will be done exclusively by Irving Shipbuilding and Vancouver Shipyards.”

The federal government apparently has responded to the Irving statement by signalling its support for the strategy.