Winnipeg Free Press - PRINT EDITION

Memo aims to reassure PM on cost of navy ships

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OTTAWA -- A leaked memo shows officials at National Defence scrambled behind the scenes last month to reassure the Harper government they knew how much it would cost to replace the navy's supply ships.

In a report released last month, parliamentary budget officer Kevin Page said not enough money had been set aside for the $2.6-billion joint support ship program. Page suggested it would cost more than $4.1 billion to replace the existing vessels -- HMCS Protecteur and HMCS Preserver. Both ships are more than 40 years old and the stop-and-start process to acquire new ships has been going on for a decade.

To stay within the government's budget envelope, Page said the capabilities of the new ships would have to be scaled back even further.

But a briefing note, prepared for Defence Minister Peter MacKay and Public Works Minister Rona Ambrose on the same day as Page's report, suggests the budget officer's analysis is more theoretical than practical.

It says National Defence's numbers are further along than the budget officer's projections, which were based on a sophisticated software model in use around the world, most notably with the U.S. Government Accountability Office and the British Ministry of Defence.

The Canadian navy is using a different system, with the help of outside naval contractors, and its figures rely on "actual cost estimates" for both designs that are under consideration.

Yet they remain estimates, which have been analyzed by independent experts, said the memo written by the navy's project manager.

MacKay, questioned in the aftermath of the Page's report, insisted the navy will get the ships it needs.

Ambrose underscored during question period in the House of Commons that the final design would be tested for affordability.

-- The Canadian Press

Republished from the Winnipeg Free Press print edition March 16, 2013 A26

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