Question Period Note: Arctic and Offshore Patrol Ships Costs

In December 2023, the Department of National Defence responded to a media inquiry regarding the issues and repairs underway on the Arctic and Offshore Patrol Ships (AOPS). As part of this response, 14 ongoing issues were proactively disclosed. These issues continue to draw media attention.

• When building the first ship in a class, it is normal and expected that there will be issues identified throughout the building process – including after delivery – that require correction
• The Arctic and Offshore Patrol Ship is the first warship built in Canada in the last 20 years. Much learning has taken place, resulting in a significant reduction in defects encountered on successive ships
• Through testing and use after delivery, the Royal Canadian Navy has identified deficiencies in several areas and Canada is working collaboratively with the shipyard to resolve these issues and apply those lessons to improve the quality of our future ships

If pressed on repair costs to fix issues:

• We are aware of the ongoing costs and concerns affecting the Arctic and Offshore Patrol Ships. The majority of the issues raised are either fully resolved or partially resolved with mitigation plans in place. We are working diligently to ensure these concerns are addressed and repairs completed

If pressed on our north, strong and free: a renewed vision for Canada’s defence:

• We stand united in our commitment to the Arctic, an enduring symbol of our nation's resolve and strength. 'Our North, Strong and Free: A Renewed Vision for Canada's Defence' reflects this unwavering dedication, highlighting the critical role of the Arctic and Offshore Patrol Ships in the preservation of our Arctic sovereignty
• These advanced vessels are at the heart of our collective strategy for a contemporary, agile naval force, ready to meet the evolving challenges of the Arctic's dynamic environment and the increasing demands of global security

Recent news articles have noted concerns regarding corrosion, mechanical failure, and severed flooding on AOPS. The government is aware of these ongoing issues and has established a plan to address them.

• The technical issues affecting AOPS are being addressed by in-service support contracts for AOPS 1 and 2, which have already been delivered and accepted, and are no longer under warranty. The repair plan for these vessels is underway and costs are not currently available
• AOPS 3 and 4 repairs are being conducted under warranty and mitigations are being implemented to ensure that similar issues do not occur on AOPS 5 to 8. These repairs are not yet complete and therefore the final costs are not currently available

Canada contracted for shipbuilding warranty periods that are typical for shipbuilding projects. The workmanship warranty period for the AOPS ships is 12 months after delivery. For ships out of the warranty period, the repairs are being conducted under the AOPS and Joint Support Ship In-Service Support Contract. To qualify as a warranty item, deficiencies must be identified prior to the end of the 12-month period post acceptance. The contractor remains responsible to address these issues, even if those repairs are completed after the warranty period.

Canada has worked collaboratively with the shipbuilder, the in-service community and with the members of the RCN to achieve these results.

The AOPS project will deliver 6 vessels to the RCN to conduct sovereignty and surveillance operations in Canada's waters, including the Arctic, as well as a wide variety of operations abroad. The project will also deliver 2 modified AOPS to the CCG to conduct sea-borne surveillance such as fisheries patrols as well as other missions, including emergency response, buoy tending, icebreaking support, and ocean science.

The vessels are able to perform a wide variety of tasks, such as: provide increased presence and conduct surveillance operations throughout Canada’s waters, including in the Arctic; support Canadian Armed Forces (CAF) sovereignty operations; participate in a wide variety of international operations, such as anti-smuggling, anti-piracy or international security and stability; contribute to humanitarian assistance, emergency response and disaster relief domestically or internationally; conduct Search and Rescue and facilitate communications among other ships; support CAF core missions including capacity building in support of other nations; and support other government departments in their ability to enforce their respective mandates.

• Under the National Shipbuilding Strategy, the Government is delivering a total of 8 AOPS
• 6 AOPS for the Royal Canadian Navy (RCN) will conduct sovereignty and surveillance operations in Canada’s waters, including the Arctic; 4 of these vessels have been delivered, and the remaining 2 are under construction
• 2 AOPS for the Canadian Coast Guard (CCG) will be dedicated to a range of missions, including North Atlantic Fisheries Organization patrols, and will have ice-capable functionality that will allow the CCG to expand its patrol capability into the low Arctic
• Construction on the first of the 2 CCG AOPS began on August 8, 2023
• To date, the total warranty cost of the AOPS program is $8.9 million, with the cost and number of warranty issues decreasing significantly on each successive ship