Supplementary estimates (A) line items - National Defence

Joint Support Ships

  • Support ships provide crucial at-sea refueling and deliver supplies to Canadian military vessels participating in naval operations and exercises.
  • This is why we are very pleased to have awarded a build contract to Seaspan’s Vancouver Shipyards for the full construction of two Joint Support Ships.
  • These two new Joint Support Ships will allow the Royal Canadian Navy to conduct and sustain major international operations.
  • In these Estimates, National Defence is requesting $585.76 million for this project.
  • These funds will be used to:
    • Continue building the first ship;
    • Procure complex items, like engines, to make sure they’re ready for the appropriate stage in the construction schedule; and
    • Finalize the ship design to meet the Royal Canadian Navy’s design specifications and environmental codes.
  • National Defence will continue to closely monitor this project to ensure the supply vessels are delivered on time, meet specified requirements, and are best value for taxpayers.

If pressed on cost increase:

  • Since the initial design contract was awarded in 2017, we have made significant progress in the ship’s design, conducted a thorough cost-risk analysis, and gained shipyard experience.
  • The total project budget of $4.1B includes the purchase of the two ships and initial spares, design and production engineering work, as well as project management and associated contingency costs.
  • Further, the contractor will invest 100% of the value of the contract into the Canadian economy, sustaining thousands of jobs annually.

If pressed on whether using MV Asterix and another commercial ship is cheaper and easier than building the JSS:

  • While the Asterix is meeting the Navy’s short-term requirements for basic at-sea replenishment duties, it is a commercial vessel that does not meet the same standards as a military ship.
  • Additionally, the cost of the Asterix only covers the provision of service over a limited number of years, and does not represent the cost of purchasing the ship outright.
  • In comparison, the Joint Support Ships will be able to carry out at-sea replenishment capabilities as well as the full spectrum of military activities required for the Navy’s operations.
  • Together will the Canadian Surface Combatants and Arctic and Offshore Patrol Ships, the Joint Support Ships will form the core of the naval fleet, and will provide the best value for Canadians.

Key Facts

  • Cost:
    • Total approved budget: $4.1B, excluding taxes. $3.1B will be used to purchase the ships and initial spares, and $1.0B for supporting costs.
    • An estimated $5.2B will be spent on personnel, operations, and maintenance over the ship’s 30 year lifespan.
  • Timelines:
    • First Joint Supply Ship is expected to be delivered: 2023
    • Second supply ship is expected to be delivered: 2025
  • COVID-19: The ongoing COVID-19 pandemic is not currently impacting the existing project timelines.
  • Main Estimates 2020-21 request: $265.5M
    • These funds will be used to deliver the two new supply ships between 2023 and 2025.

Details

  • The two new Joint Support Ships are intended to replace the Navy’s Auxiliary Oiler Replenishment vessels. They will provide at-sea support to naval task groups, limited sealift capabilities, and support to operations ashore.
  • In 2013, after a rigorous interdepartmental selection based upon affordability, capability, and risk, National Defence selected a design for its Joint Support Ship project that offers the best value to Canada.
  • Public Service and Procurement Canada selected Seaspan’s Vancouver Shipyards as the prime contractor to build these vessels for the Navy. In June 2018, this Shipyard started the construction of the first supply ship. It is expected to be delivered in 2023.
  • A $2.4 billion contract for full-rate construction of the JSS was awarded to Seaspan Vancouver Shipyards in June 2020. This contract will build on the ongoing construction of the first ship’s early build blocks, and will progress to full-rate construction of the remaining blocks.

Cost

  • The Joint Support Ship’s budget envelope is $4.1 billion (authorities received on February 27, 2020). The new project budget is the result of a thorough cost-risk analysis, and shipyard experience.
  • Since its inception, the project has spent $998.5 million (excluding taxes) in Capital funds. These funds have been used on options analysis, design licenses, design and construction efforts, establishing the supply chain, and project management costs.

Version 2 – 2020-06-16 – Source: Supps (B) 2020-2021 note: Joint Supply Ships

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Operations (REASSURANCE, UNIFIER, PRESENCE)

  • Now more than ever, we are reminded of the importance of global cooperation, and promoting peace, security, and the rules-based international order.
  • While COVID-19 has forced us to pause or alter some of our operations and activities to ensure the safety of our personnel, it has not diminished our leadership on the international stage.
  • In these Estimates, National Defence is requesting $141.5 million to support operations in Europe and Africa.
  • Of these funds:  
    • $111.4 million will be used to support our contribution to NATO land, maritime, and air activities in Central and Eastern Europe, including:
      • Operational and tactical level demonstrations;
      • Maneuvers; and
      • Enhanced interoperability activities with Allies and partners.
    • $25.4 million will be used to continue training support, capacity building, and professionalization of the Security Forces of Ukraine; and
    • $4.7 million will be used to support:
      • The tactical airlift detachment in Uganda;
      • 10 Canadian Armed Forces members at MINUSMA Headquarters in Mali; and
      • The Operational Support Hub in Senegal.

Key Facts

  • Operation REASSURANCE: Canada has fully maintained its presence both at sea and land in Central and Eastern Europe, while taking a number of measures to protect the health and well-being of our members.
  • Operation UNIFIER: In March 2020, Canada temporarily paused its training activities under Operation UNIFIER.  
    • While 200 personnel were scheduled to deploy in April, this was reduced to 60.
    • On June 14, additional members have been deployed to the mission, bringing the number of Canadian Armed Forces members in Ukraine to 149.
    • Personnel will observe a 14-day isolation period on arrival in Ukraine.
  • Operation PRESENCE: Due to strict COVID-19 restrictions for air crew entering Uganda, the May and June episodes have been postponed.
    • We are currently reviewing whether the conditions are right for a deployment of the aircraft in July.

Details

Recent parliamentary interest

  • There has been sustained interest in Operations from Parliamentarians and the media since the beginning of the new Parliament. Most recently, there has been interest on a change in posture and activities due to COVID-19.
  • The media has demonstrated recent interest on the number of peacekeepers deployed by Canada to UN missions. This interest has been related to the upcoming UN Security Council election scheduled to take place on June 17, 2020. Canada is competing with Norway and Ireland for a seat as a non-permanent member.
  • Parliamentarians have demonstrated sustained interest in Canada’s contributions to Operation REASSURANCE writ large. In February 2020, National Defence officials provided an informal briefing to Parliamentarians on Operation REASSURANCE, as well as Operation UNIFIER – Canada’s training mission to assist with security force training in Ukraine.

Operation REASSURANCE

  • The Canadian Armed Forces (CAF) supports assurance and deterrence measures in Central and Eastern Europe through Operation REASSURANCE by contributing to NATO land, maritime, and air measures.
    • Enhanced Forward Presence Battle Group Latvia: Canada is leading a NATO Battle Group in Latvia of approximately 1500 soldiers with military members from eight other nations, including: Albania, the Czech Republic, Italy, Montenegro, Poland, Slovakia, Slovenia, and Spain.
    • Maritime measures: Canada regularly contributes one frigate to either Standing NATO Maritime Group One or Two, conducting patrols and surveillance in the North Atlantic and Mediterranean. HMCS Fredericton is currently assigned to Standing NATO Maritime Group One in the North Atlantic and will be relieved in theatre by HMCS Toronto in July 2020.
    • Air measures: Canada periodically contributes to a peacetime collective air policing mission to safeguard the integrity of NATO airspace. On January 3, 2020, Air Task Force Romania completed a four-month NATO enhanced Air Policing mission in Romania. The Air Task Force consisted of five CF-188 Hornets and approximately 135 Royal Canadian Air Force personnel. The next rotation will occur this fall.

Operation UNIFIER

  • In 2015, Canada launched Operation UNIFIER in response to requests from the Government of Ukraine. The CAF provide Ukrainian security forces with specialized training to help improve their capability and capacity. The CAF continues to work alongside the United States, the United Kingdom, Lithuania, Poland, Denmark, and Sweden, to coordinate training, equipping, and capacity building efforts.

Operation PRESENCE

  • From August 2018 to August 2019, Canada delivered on its first “Smart Pledge” by providing two Chinook and four Griffon helicopters, as well as 250 personnel, to conduct aeromedical evacuations and tactical airlift in support of UN forces in Mali.
  • The CAF is delivering on another pledge by providing a CC-130J Hercules aircraft conducting tactical airlifts out of Entebbe, Uganda. The airlifts help sustain UN operations in the Democratic Republic of Congo and South Sudan. This support is currently on pause as the host nation has instituted strict COVID-19 protocols that affect all arriving flight crew.

Version 2 – 2020-06-15 – Source: Supps (A) notes on OP UNIFIER, OP REASSURANCE, Peacekeeping

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Future Fighter Capability Project (FFCP)

  • A modern fighter jet fleet is essential for defending Canada and Canadian sovereignty, and for contributing to our NORAD and NATO commitments, now and in the future.
  • This is why we launched an open and transparent competition to acquire 88 new advanced fighter aircraft.  
  • We remain confident that we are still on track to award the contract for the new fighter jets in 2022.
  • In these Supplementary Estimates, National Defence is requesting $16.6 million, excluding statutory costs, to continue the project’s definition phase activities.
  • These funds will be used to begin work on designing and building new fighter jet facilities to ensure that they will be ready in time for the first aircraft deliveries.
  • Through this project, we will deliver a modern fighter capability to the Royal Canadian Air Force, ensuring that it maintains the capability to meet complex and evolving threats.

If pressed on extension for proposals:

  • The unprecedented nature of the COVID-19 pandemic has presented numerous challenges for many businesses and governments.
  • To support our commitment to an open, fair, and transparent competition, this one-month extension to July 31st will ensure all suppliers are able to submit their most competitive offer.

Key Facts

  • Total estimated project budget is between $15-19B.
  • First delivery in Canada expected as early as 2025.  
  • Eligible Supplier Teams: Sweden-Saab, USG-Boeing and USG-Lockheed Martin
  • Main Estimates 2020-21 request: $23.1M
    • Funds will be used for professional services support, evaluating bidders’ proposals, infrastructure design activities, and salaries.

Details

Future Fighter Capability Project

  • The Future Fighter Capability Project (FFCP) will acquire and transition into service 88 advanced fighter aircraft and associated equipment, weapons, infrastructure, information technology, and sustainment, including training and software support.
  • This project will leverage Canadian capabilities and support the growth of Canada’s aerospace and defence industries. More specifically, Canada has implemented a Value Proposition that seeks to motivate generational investments in Canada’s aerospace and defence industries over the coming decades, and drives innovation, exports and skills development in Canada’s Key Industrial Capabilities, including in areas like In-Service Support, Aerospace Systems, and Components and Space Systems.
  • The project will replace the current CF-18 fighter capability which principally operates out of Cold Lake, Alberta and Bagotville, Québec.

Activities to date

  • In December 2017, the Government launched an open and transparent competition for the permanent replacement of Canada’s fighter fleet.
  • In February 2018, the Government announced five eligible government-led Supplier teams, including Dassault, France; SAAB, Sweden; Airbus, United Kingdom; Boeing, United States; and Lockheed Martin, United States.
  • On November 8, 2018, the France-Dassault team informed Canada of its decision to officially withdraw from the competition, and on August 30, 2019, United Kingdom-Airbus also informed Canada that it was withdrawing. Only the three remaining Supplier teams are currently eligible to submit proposals under the future fighter competitive procurement process.
  • On July 23, 2019 after 18 months of extensive engagement with the eligible Suppliers, the Request for Proposal was released.
  • Extension for Proposals: While the Project was supposed to receive Bidder Proposals by March 31, 2020, at the request of industry, proposal-submission due dates were extended twice, once on February 24, 2020 and again on May 6, 2020, for a combined total of a four month extension. Proposals are now due by July 31, 2020.

Version 1.1 – 2020-06-10 – Source: D Parl A Supps (B) note, “Future Fighters – v3.1”, 2020-02-26; ADM(Fin) Main Estimates note.

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