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House Hansard - 75

44th Parl. 1st Sess.
May 19, 2022 10:00AM
Context: House Hansard - 75 - May/19/22
Mr. Pierre Paul-Hus
  • May/19/22 6:51:00 p.m.
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Madam Chair, I have another point that was raised by officials from Public Services and Procurement Canada. On April 7, these bureaucrats told the committee that we can expect further cost overruns and delays regarding the delivery of new ships for the navy and the Coast Guard, and that the multi-billion dollar shipbuilding program faces significant challenges. Will the minister admit that billions of dollars in cost overruns are already expected?
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Context: House Hansard - 75 - May/19/22
Hon. Filomena Tassi
  • May/19/22 6:51:26 p.m.
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Madam Chair, I have had an opportunity to visit one of the shipyards, and the work that is going on there is second to none. To see the extent of what is taking place here in Canada, on Canadian soil, to produce these ships is absolutely fantastic. It is creating jobs and economic growth right here in Canada.
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Context: House Hansard - 75 - May/19/22
Mr. Pierre Paul-Hus
  • May/19/22 6:52:57 p.m.
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Madam Chair, Troy Crosby, the person responsible for National Defence procurement, told the committee that the ships are not being built fast enough and that they are costing more. I want to know if the minister has sent the shipyards an official letter, directive or document of some sort expressing the Government of Canada's concerns about the delays and cost overruns. If so, when did she send it? If not, why not?
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Context: House Hansard - 75 - May/19/22
Hon. Filomena Tassi
  • May/19/22 6:53:25 p.m.
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Madam Chair, we are constantly monitoring the progress of the shipyards. We are working very closely with the shipyards. They are working very hard to keep their projects on budget and on time, but they have faced challenges, as I have already mentioned. We continuously monitor the situation and do whatever we can to assist to ensure that those ships are built as quickly as possible and with the amount that has been allotted.
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Context: House Hansard - 75 - May/19/22
Hon. Filomena Tassi
  • May/19/22 6:54:25 p.m.
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Madam Chair, again, we are working with the shipyards. I would like to point out that we have actually had five large ships delivered already. Three of the offshore fisheries science vessels have been delivered, and two of the AOPS have been delivered. Other projects are under construction. We are going to continue to work with the shipyards, and we will ensure that we continue to monitor the situation and do what we can to support them. We know how important it is to keep these jobs here in Canada and have this production take place here in Canada.
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Context: House Hansard - 75 - May/19/22
Mr. Pierre Paul-Hus
  • May/19/22 6:54:58 p.m.
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Madam Chair, let us talk about some of projects that are currently being delivered or have been delivered, particularly the Arctic and offshore patrol ships. A witness who appeared before the Standing Committee on Government Operations and Estimates last week, Mr. Kendrick, said he really could not understand why the cost of the seventh and eighth ships to be delivered to the Canadian Coast Guard will exceed $1.5 billion, while Norway is building three larger, more powerful ships for a total of $700 million. Can the minister explain that?
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Context: House Hansard - 75 - May/19/22
Hon. Filomena Tassi
  • May/19/22 6:55:30 p.m.
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Madam Chair, I would point out that it depends on what the specs are with respect to the ships that are being built.
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Context: House Hansard - 75 - May/19/22
Mr. Pierre Paul-Hus
  • May/19/22 6:55:41 p.m.
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Madam Chair, obviously it depends on the ships. In the case of these ships, however, we understand that the contract for the first five ships was for $400 million each, but the sixth ship is going to cost $800 million, bringing the total to $2.8 billion. We have learned that the total bill for all the ships would be $4.3 billion. The cost per ship normally goes down, but instead it is going up. The seventh and eighth ships ordered are going to cost $1.5 billion. After gaining experience from building the first two ships, we should be improving, not regressing. Can the minister explain why this is costing more, not less?
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Context: House Hansard - 75 - May/19/22
Hon. Filomena Tassi
  • May/19/22 6:56:21 p.m.
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Madam Chair, we continue to monitor these ships as they are being built. The estimate for the ships that I believe the member is referring to, the two vessels, is projected to be $1.5 billion. We are going to continue to monitor the situation and ensure that the ships being built are required. There may be instances, for certain ships being built, that the design changes, but we continue to work with the shipyard. We are also continuously monitoring the price to see if the ships are over budget. We are constantly looking at that and determining what is bringing them over budget, and we are keeping a close eye on it so we can continue to work with the shipyards and they can deliver things as quickly as possible and respond to the specs.
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Context: House Hansard - 75 - May/19/22
Hon. Filomena Tassi
  • May/19/22 7:02:57 p.m.
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Madam Chair, right now I think we are delivering in defence. We have a strong defence record. In terms of what we are in the process of doing, we are moving forward to finalize 88 new fighter jets, we are delivering the first Canadian-built ships in 20 years and we are acquiring six Arctic offshore patrol vessels. We are continuing to deliver in defence. Right now the situation is a strong one, and we will continue to procure in this manner, which is strong.
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Context: House Hansard - 75 - May/19/22
Hon. Filomena Tassi
  • May/19/22 7:23:13 p.m.
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Madam Chair, I would repeat what I said earlier, which is that I believe that we are strong in defence procurement. In fact, members can look at what we are involved in right now: The most significant investment in the air force in 30 years is the purchase of 88 fighter jets. The first five ships have been delivered under the national shipbuilding strategy. Two-thirds of the projects under Strong, Secure and Engaged have been either implemented, completed or are near completion. That is a pretty strong record. In terms of defence procurement, I think we have a strong record.
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Context: House Hansard - 75 - May/19/22
Hon. Filomena Tassi
  • May/19/22 9:11:51 p.m.
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Madam Chair, I am happy to support the national shipbuilding strategy, and they are going to provide us with the ships that we—
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Context: House Hansard - 75 - May/19/22
Mr. Luc Berthold
  • May/19/22 9:20:39 p.m.
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Madam Chair, in his statement, Mr. Kendrick said that, broadly speaking, Canada is paying between three and five times the world price for ships and taking two to four times longer to get them. Is the minister also proud of those results?
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Context: House Hansard - 75 - May/19/22
Mr. Luc Berthold
  • May/19/22 9:21:08 p.m.
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Madam Chair, I am quoting comments made by a committee witness who worked for the Canadian government from 1981 to 2020. Mr. Kendrick also asked the committee to note that the offshore patrol ships are not wanted or needed by either the navy or the Coast Guard and are only being built to keep the shipyard busy until the Canadian surface combatant project is ready to move forward. Does the minister agree with that statement?
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Context: House Hansard - 75 - May/19/22
Mrs. Julie Vignola (Beauport—Limoilou, BQ)
  • May/19/22 9:38:04 p.m.
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Mr. Chair, I would like to know the official cost of the Arctic and offshore patrol ships and whether it is possible to break down those costs.
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Context: House Hansard - 75 - May/19/22
Mr. Ben Lobb (Huron—Bruce, CPC)
  • May/19/22 10:08:05 p.m.
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Mr. Chair, I am going to share my time with the member for Louis-Saint-Laurent. I thank the minister for her work tonight. It is quite a feat to put in all the time and to answer all the questions, and I thank her for that. Andrew Kendrick, a naval architect with 40 years' experience, appeared before committee. His statement was that it costs three to five times the world price and two to four times longer to deliver ships in Canada versus the rest of the world. Does the minister have any comment on that? Has she investigated and verified this to be true, or does she feel we are in line with world price and world delivery?
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