Question Period Note: Canadian Surface Combatant

In a time where COVID-19 has hit families so hard and so many Canadians are out of work, why is this Government unable to advance this project and create the jobs our economy needs?

• Naval combat ships are critical for defending Canadian waters, and contribute to naval diplomacy and international security.
• That is why we are procuring 15 new Canadian Surface Combatants which will deliver decisive combat power at sea for our Navy.
• We are currently working with industry to finalize the selected ship design in preparation for the building phase of this project.
• We will also continue to assess the impacts of COVID-19 on project timelines.
• This project represents the largest and most complex investment in the Royal Canadian Navy since the Second World War.
• It will help revitalize the Canadian shipbuilding industry, creating and sustaining tens of thousands of jobs across this country.
• We look forward to cutting steel on the first ship in the 2024 timeframe.
• National Defence will remain open and transparent with Canadians as we move this project forward.

Quick Facts

• Estimated Budget: $56 - $60 billion
• Timeline: First delivery in early 2030s, last ship delivery in late 2040s
• GBA +: Canadian Surface Combatant will include:
  • Berths, wash places, bathrooms, medical facilities, and off-duty areas that are designed to accommodate all genders and promote privacy;
  • Flexible spaces which allow for religious and spiritual accommodation; and
  • Integrated Wi-Fi to facilitate crew communications with families back home.
• Indigenous relations: Irving Shipbuilding Inc. is leading initiatives, including:
  • Job training and apprenticeships for Indigenous Canadians, visible minorities, and underrepresented groups in shipbuilding.

Background

• Canada’s new class of warship – the Canadian Surface Combatant (CSC) – will replace and update the capabilities found in both the retired Iroquois-class destroyers and the Halifax-class frigates. This single class of ship will be capable of meeting multiple threats on the open ocean and the coastal environment.
• The new warships will be able to conduct a broad range of tasks, including:
  • Delivering decisive combat power at sea, either independently or as part of a Canadian or international task group;
  • Supporting the Canadian Armed Forces and Canada’s allies ashore;
  • Conducting counter-piracy, counter-terrorism, interdiction and embargo operations for medium intensity operations; and,
  • Delivering humanitarian aid, search and rescue, and law and sovereignty enforcement for regional engagements.

Project status

• In February 2019, the Government selected a design for CSC, and announced that Irving Shipbuilding had contracted Lockheed Martin Canada to provide the design and design team.
• Canada is now working with Irving Shipbuilding, Lockheed Martin Canada, and their subcontractors to evolve the selected ship design and systems integration in preparation for build.

Parliamentary Budget Officer (PBO) Estimates:

• In February 2021, in response to a request by the House of Commons Standing Committee on Government Operations and Estimates (OGGO), PBO released its second costing analysis in two years on the CSC project.
• PBO has provided the following estimates for the CSC Project:
  • 2021 PBO-CSC Report: $77.3 billion (with taxes)
  • 2019 PBO-CSC Report: $69.8 billion (with taxes)
• Rationale for the difference between PBO and DND estimates:
  • PBO relies more on models while National Defence’s estimates integrate costs received from suppliers through request for proposals.
  • PBO model places greater emphasis on overall ship weight. As such, any increase in ship weight translates into an increase in cost.
  • National Defence considers weight as a factor in its cost analysis, but it also incorporates the information received from industry, such as the actual known prices for the equipment required to build the ships.
  • PBO also includes provincial sales tax.

Economic benefits:

• Irving Shipbuilding Inc. and Lockheed Martin Canada will invest an amount equal to their contract value back into Canada’s economy.
• The CSC project will promote growth of key industrial capabilities in Canada by:
  • Creating investments into innovation, supplier development, and export opportunities with a focus on cyber security, clean technology, and the marine sector.
• This project is estimated to create or maintain an estimated 2,500 Canadian jobs during the 4-5 year design period, and more than 10,000 Canadian jobs throughout the 25-year construction period.

Responsible Principals: Assistant Deputy Minister (Materiel), Royal Canadian Navy

Assistant Deputy Minister (Materiel), Royal Canadian Navy