The federal government says it plans to divvy up $7 billion in maintenance and repair contracts for Royal Canadian Navy frigates to three shipyards, a political compromise that was met with mixed reaction.
Public Services and Procurement Canada announced the advance contract award notices on Thursday for Halifax鈥檚 Irving Shipbuilding Inc., Seaspan Victoria Shipyards in Victoria, B.C., and Davie Shipbuilding in Levis, Que.
The contracts are to maintain Canada鈥檚 12 Halifax-class frigates until the end of their operational life, estimated at another 20 years.
Ottawa said in a statement that after consultations, it was decided the three Canadian shipyards were needed to complete the work on the warships.
It was not immediately clear how the money would be divided among the three shipyards. A government spokesman said the value of each contract would be variable as the number of 鈥渄ocking periods鈥� per shipyard may vary.
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David Baker-Mosher, president of the Unifor Marine Workers Federation Local 1 union at Halifax鈥檚 Irving shipyard, called the government鈥檚 plans an 鈥渦tter disappointment.鈥�
鈥淲orkers feel their future is being jeopardized,鈥� he said, noting that the decision could mean layoffs.
鈥淚t鈥檚 disappointing that our government cannot understand how these ships are worked on and how much skill is needed.鈥�
At issue is a gap between the end of the Arctic and Offshore Patrol Ships program and the start of the Canadian Surface Combatant program.
Irving has indicated in the past that repair work on the Halifax-class frigates would help mitigate that gap and sustain jobs.
An Irving spokesman declined an interview on Thursday鈥檚 announcement, but said the company would provide comment following an announcement by Defence Minister Harjit Sajjan at the Halifax Shipyard Friday morning.
In B.C., Tim Page with Seaspan said the company was pleased with the government鈥檚 intent to contract the Victoria shipyard.
鈥淲e have been repairing and refitting those vessels now for some time on budget and on time and that elicits great pride in our workforce in Victoria,鈥� said Page, Seaspan鈥檚 vice-president of government relations.
However, he pointed out that 鈥渋t鈥檚 not the end of the road鈥� as there is a 15-day 鈥渃ure period.鈥� The deal gives other interested suppliers 15 days to come forward if they wish to bid on the contract and submit a statement of capabilities that meets the requirements laid out in the contract notice.
In Quebec, the announcement was greeted with relief by Davie Shipbuilding, which has laid off hundreds of employees over the past year as work dried up.
鈥淭here is finally stability,鈥� company spokesman Frederik Boisvert said.
Ottawa has faced strong pressure from the Quebec government to send more work Davie鈥檚 way.
The company had 1,500 employees during work to convert a civilian ship into a new interim resupply vessel for the navy, but the workforce has fallen to 250 since that ship was delivered in 2017. Davie has been seeking a contract to produce a second resupply vessel.
Ken Hansen, an independent defence analyst and former navy commander, said dividing the work between three shipyards through untendered contracts is about politics.
鈥淎ny work that is awarded to Davie is done for the sake of politics,鈥� he said. 鈥滻t tells you that the power of the Quebec caucus in the Liberal party is really strong.鈥�
Hansen said international best practice is to do repair and maintenance work in the ships鈥� home port.
鈥淚f the ships have to travel a distance and get their work done elsewhere, it鈥檚 both ineffective and uneconomical,鈥� he said.
The Royal Canadian Navy鈥檚 Atlantic fleet is based at CFB Halifax while the Pacific fleet is based at CFB Esquimalt near Victoria, B.C.
Hansen added that the decision hearkens back to a historic approach to shipbuilding in Canada
鈥淭he various regions all had a slice of the shipbuilding pie and what ended up happening 鈥� was this boom and bust cycle,鈥� he said, noting that it led to repeated gaps in work and layoffs.
Michael Byers, a University of British Columbia professor and expert on Canadian defence policy, agreed that the decision was likely influenced by politics but called it a 鈥渄efensible policy choice.鈥�
鈥淚t鈥檚 likely a decision made for a political reasons, but it鈥檚 not a decision that threatens the viability of the shipyards in Halifax or B.C.,鈥� he said.
鈥淚t鈥檚 a defensible decision even if the motivation was probably political.鈥�
Byers added that Irving can also bid on work on the commercial market and shouldn鈥檛 expect government to fill every gap.
鈥淔rom a political point of view, it is interesting that the government has found a way to potentially satisfy everyone,鈥� he said. 鈥淔rom a vote winning perspective, that鈥檚 an optimal outcome for the federal government.鈥�
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Conservative Leader Andrew Scheer, in Quebec City to meet with Premier Francois Legault, accused the federal government of 鈥渘eglecting the Davie Shipyards.鈥�
He said the resupply vessel was delivered 鈥渙n time, on budget, and now they鈥檙e delaying the second ship unnecessarily, which is costing jobs here.鈥�
Nova Scotia Premier Stephen McNeil said his government has spoken with Ottawa about maintaining work at the Halifax Shipyard.
鈥淲e鈥檝e made the case to the national government that we believe the level of work should be maintained at the shipyard so they can hold on to the high quality talent that they currently have,鈥� he told reporters.
Ottawa says the work on the frigates is necessary while the navy awaits the delivery of replacement Canadian Surface Combatant ships.
The Canadian Press
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