Retired navy commander critiques Davie shipyard's shipbuilding strategy view

A retired navy commander in Halifax says Davie shipyard's critique of the national shipbuilding strategy is flawed.

"I think that principally, it comes from a frame of reference which is not Canadian," Ken Hansen told CBC Mainstreet Thursday. 

The 32-year veteran is now a resident research fellow at Dalhousie University's Centre for Foreign Policy Studies.

Davie shipyard's CEO, Alex Vicefield, told CBC News earlier this week that the strategy is "bizarre" and "an international embarrassment." He called the prices "exorbitant" and criticized the program for producing no ships in five years.

One of Vicefield's main complaints is that the contracts would allow companies, including the Halifax Shipyard, to take a percentage of the price tag as profit. This provides a "perverse incentive" for the industry to push up costs, Vicefield said.

Changing costs

But Hansen said such contracts are structured that way for a reason.

"The industry in this country was in a serious state of decline and was surviving on a starvation diet of repair work and very minor contracts," he said. 

There are different supply, design and labour ways to manage costs, but it's hard to know the costs until you actually build the ships, Hansen said.

Canada hasn't build combat ships since the late 80s early 90s, Hansen said, when the frigate program ended in Saint John, N.B.

"Now, the global maritime security situation involves pirates in the Arabian [Sea] and radical extremism throughout a large part of the world — human smuggling, armed smuggling, in addition to all of the old stuff."

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There are also drones, adding to items that would make costs different now, he said.

Buying equipment offshore instead of in Canada would be less costly, he said, but added the country wouldn't get the economic spinoffs of fabrication, jobs and infrastructure here in Canada.

It's also good to focus on a couple of larger contracts, Hansen said.

"It is not helpful to argue that we should be going back to the bad old way, based on political perception of fairness and equity and distribution," he said.

"[And back] to the boom and bust cycle that saw contracts being assigned in places of the country where everybody knew going in that this wasn't [going to] last."

Five years 'not that long'

Davie shipyard recently made an unsolicited bid to the federal government to refit a series of existing ships. 

The company said it can build an icebreaker in less time and almost half the cost.

"A big part of the proposition is going off shore," Hansen said.

The money would leave Canada that way, taking with it the knowledge and innovation that would have been developed here, he said.

No one with knowledge of shipbuilding expected the ships to be built within five years, Hansen said.

It took a lot of work to get where to the current day's stage, he said.

"Five years — when you're talking about a national strategic industry — is not that long a time."