CADSI News Story

CADSI is Encouraged by Today’s Announced Progress on the National Shipbuilding Procurement Strategy

(March 7th, 2013 – Ottawa) – Today’s federal government announcement of the commencement of the definition phase for Arctic Offshore Patrol Ships (AOPS) is yet another positive step forward in the launch of the National Shipbuilding Procurement Strategy (NSPS), according to the Canadian Association of Defence and Security Industries (CADSI).

“This early progress on the National Shipbuilding Procurement Strategy is encouraging, and underscores the government’s commitment to construct and maintain ships in Canada to maximize jobs, innovation, manufacturing and economic activity,” said Tim Page, President of CADSI.  “The government can build on this progress by putting in place an overall defence procurement strategy as promised in the 2011 federal Budget, including the development of domestic industrial participation plans for each NSPS project, and sharing them with industry at the earliest opportunity.”

Mr. Page added, “The Government’s ability to generate the projected 15,000 jobs and $2 billion in annual revenue from NSPS will depend not just on the hulls that will be built in Canada, but also on how effective it is in leveraging direct domestic marine industrial participation into AOPS and JSS, CSC and the other fleets that comprise NSPS. It has to start now, through the development of a domestic participation plan as part of a defined defence procurement strategy, so that companies know what is important to Canada and can align their capabilities with potential partners and prime contractors to Canada’s maximum economic benefit.”

Mr. Page pointed out that depending on the class of vessels, a minimum of 50% of the total value of ship construction will come from shipyard work associated with the construction of the hulls, with the remaining 50% of the value to come from the technology and equipment that is built into the hulls of the new vessels.  Meanwhile, the estimated value of maintenance, repairs and mid-life upgrades to the on-board capabilities will likely be of equal or greater value than the initial construction costs.  “In short, decisions around what technology and equipment is chosen to fit up the hulls, and from whom the government purchases it, is directly relevant to the economic value Canada can expect to receive from its investment in NSPS,” said Mr. Page.

Mr. Page said he agreed with the assessment by Defence Minister MacKay made during a speech earlier this week in Ottawa, in which he said, “Decisions made by the government in respect of NSPS represent a transformative opportunity for Canada’s defence industry.”

“Minister MacKay’s expressed viewpoint is consistent, we believe, with that of Tom Jenkins in his report to Public Works Minister Rona Ambrose and with David Emerson in his report to Industry Minister Christian Paradis,” said Mr. Page.  “Both reports have offered the government practical advice on how to improve defence procurement outcomes to advantage Canada. Both have recommended that the Government look to strategies beyond its Industrial and Regional Benefits program to leverage greater direct Canadian participation into military spending for both acquisition and in-service support contracts. Practical, common-sense, widely-used policy approaches like those recommended by Jenkins and Emerson will help the government to achieve the transformative opportunities Minister MacKay spoke about with respect to NSPS and all other military procurements.”

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CADSI is the voice of Canada’s defence and security industries. CADSI represents over 950 member companies who are essential contributors to Canada’s national defence and security. The sector employs 109, 000 Canadians and generated over 12.6 billion dollars to the Canadian economy in 2011.

For more information on CADSI visit: https://www.defenceandsecurity.ca

(For further information contact: Christel Gallant 613-235-5337 ext 29)

Posted 2013-03-07
Last Modified 2013-03-07 16:58