Tuesday, February 14, 2017

Shipbuilders Seek Simplified Government System

By: ANDREA GUNN, The Chrinicle Herald 

Having someone make swift decisions would save time and money on the National Shipbuilding Strategy, according to the government’s two key shipbuilders.

Both Irving Shipyard in Halifax and Seaspan in Vancouver have recommended Ottawa take a page from other seafaring nations and hire someone to act as a single point of accountability and decision-making in shipbuilding.

Jonathan Whitworth, CEO of Seaspan — which has contracts to build DFO and Coast Guard vessels as well as the navy’s Joint Support Ships under the NSS — told the Chronicle Herald the current system is cumbersome, often requiring extensive consultation among different bodies and levels of bureaucracy for simple decisions on things like engineering changes or matters of priority on the shipyard floor.

“What we’re asking for from the government side is that we have one person that can speak for all of the stakeholders within the government,” he said.

Whitworth said it’s often unclear who the point of contact is for a particular decision, and queries could end up with any number of government bodies: national defence, DFO, Public Works and Procurement Canada, or even the Treasury Board.

“There’s a lot of individuals,” Whitworth said.

“I will say we get along well, we talk in large groups, but that’s just really not the most efficient way to really make decisions.”

Whitworth said ideally there would be a central point of accountability within government for the NSS combat package, which Irving is building in Halifax, and one for Seaspan’s non-combat package.

“Just like any project, especially complex projects, time is money. The ability to make decisions on a more timely basis means the ship will be built quicker, which means it will inevitably be cheaper,” Whitworth said.

Though Irving president Kevin McCoy was not available for an interview, he offered similar comments to the House of Commons Standing Committee on National Defence in Ottawa earlier this month. Asked why the U.S. and U.K. tend to not have the same issues with delays as Canada when it comes to naval procurement, McCoy sa speed of decision-making as a major concern.

“I think one thing that does work against the system here is the very distributed authorities and responsibilities through many departments rather than what I’m used to, a single accountable officer, particularly for a program as huge as the Canadian service combatant,” McCoy told the committee.

“Somebody that can say, yes, in that area I’m going to go with Canadian content, in that area I’m going to go with operational requirements, in that area I’m going to go with low costs and risks and be able to push forward rather than debate it for a very long period of time.”

He went on to say that for major builds like the Canadian Surface Combatant, inflation is a real killer to a ship count, putting even more importance on swift decision-making if the navy wants the best bang for its buck.

Whitworth told the Chronicle Herald that Irving and Seaspan have already made the recommendation to government both at the defence committee as well as at a regular private meeting with government officials several weeks earlier, but have yet to get any sort of concrete answer.

He said the recommendation is not a particularly new or groundbreaking one and is something both the U.S. and U.K. have employed for years.

In fact, Whitworth said, Steve Brunton — the man hired by Ottawa last year as the government’s independent advisor on shipbuilding and ship acquisition — used to hold that position within the U.K. ministry of defence.

“This is something you don’t have to plough new ground with,” he said.

Retired navy commander and defence analyst Ken Hansen said there is definite value in having a single point of accountability on shipbuilding, from a time-saving point of view, but also to avoid issues with industrial capacity and workforce management.

“In a country like Canada where shipbuilding has not been very active for a long time, the suppliers have dwindled and their industrial capacity is reduced, so if you suddenly inject two, three, four more different construction programs under the central policy you can create conflict between them,” he said.

By putting a point of co-ordination in place, the government could better prioritize its shipbuilding activity to get the most value for the money.

The only potential issue, Hansen said, is that sometimes decisions will have to prioritize a certain project over another to arrive at the best option for the NSS as a whole.

“Whenever you have to make choices between various priorities, there’s always someone who is disappointed in the outcome.”

Public Works and Procurement Canada did not respond to an interview request by the Chronicle Herald’s deadline.

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