News Release Article from  Public Services and Procurement Canada

Archived - Government of Canada announces National Shipbuilding Procurement Strategy

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OTTAWA, Ontario, June 3, 2010 – The Government of Canada today announced the National Shipbuilding Procurement Strategy, a long-term plan that will create good jobs in high-tech industries across Canada and provide much needed ships for the Canadian Navy and the Canadian Coast Guard. The Honourable Rona Ambrose, Minister of Public Works and Government Services and Minister for Status of Women, made the announcement together with the Honourable Peter MacKay, Minister of National Defence, the Honourable Gail Shea, Minister of Fisheries and Oceans, and the Honourable Denis Lebel, Minister of State (Economic Development Agency of Canada for the Regions of Quebec).

“Our Government made the decision to support the Canadian marine industry, to revitalize Canadian shipyards and to build ships for the Navy and Coast Guard here in Canada,” said Minister Ambrose. “The Strategy will bring predictability to federal ship procurement and eliminate cycles of boom and bust, providing benefits to the entire marine industry.”

The Strategy, which was developed after consultations with industry stakeholders, encompasses three streams – large ship construction, small ship construction, and repair, refit and maintenance projects. The government will establish a long-term strategic relationship with two Canadian shipyards for the procurement of the large ships – one to build combat vessels, the other to build non-combat vessels. The selection of the two shipyards will be done in a competitive, fair, open and transparent manner. A fairness monitor and independent third party experts will participate in the process.

The construction of smaller ships will be set aside for competitive procurement among other Canadian shipyards. The repair, refit and maintenance of ships in the Government fleet will continue to be sourced through competitive tendering.

The Strategy promotes the regional distribution of work and opportunities to shipyards across the country. Shipyards that are selected to build the combat and non-combat packages will have to subcontract vast amounts of work to the broader marine industry and suppliers of this industry. Subcontracting in any of the three streams encompassed by the Strategy will be of notable benefit small and medium enterprises.

“This strategic relationship with Canadian shipyards will help us deliver on our commitment to the Canada First Defence Strategy, and enable us to provide our Navy with the modern ships they need to defend Canada’s interests at home and abroad,” said Minister MacKay.

“We are proud to support Canada’s new shipbuilding strategy because it will create jobs and help stimulate our country’s economy” said Minister Shea. “It will also give Canada’s Coast Guard the tools it needs to do its job.”

“The Strategy is about undertaking major ship procurements in a smarter, more effective way – a way that sustains Canadian jobs, strengthens the marine sector, and provides best value for Canadian taxpayers,” said Minister Lebel.

The Government of Canada is committed to getting the best value for Canadian taxpayers. Under the Strategy, shipbuilding projects that are similar in nature will be grouped together to reduce production costs. This type of strategic sourcing will create the conditions for the effective and efficient delivery and support of the federal fleet over the long term.

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See attached backgrounder for more information on the National Shipbuilding Procurement Strategy and the ships to be built.

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For more information, media may contact:

Department of National Defence: Media Relations: 613-996-2353 or 1-866-377-0811
Department of Fisheries and Oceans: Media Relations: 613-990-7537
Industry Canada: Media Relations: 613-943-2502

For further information, please contact:

Chris Hilton
Director of Communications
Office of the Honourable Rona Ambrose
Minister of Public Works and Government Services
613-697-7324
Email: Chris.Hilton@tpsgc-pwgsc.gc.ca

Media Relations
Public Works and Government Services Canada
819-956-2315

PWGSC news releases are also available on our Internet site at http://www.tpsgc-pwgsc.gc.ca/medias-media/index-eng.html.

Background

National Shipbuilding Procurement Strategy

  • The strategy, which emerged from consultations with the Canadian shipbuilding industry, is about using Canadian sources to meet our shipbuilding requirements. It has three components:
    • Construction of large ships.
    • Construction of smaller vessels.
    • Repair, refit and maintenance of existing fleets.
  • Under the strategy, the government will establish a long-term strategic relationship with two Canadian shipyards for the procurement of the large ships – one for combat vessels, the other for non-combat vessels. The two will be selected through an open, fair and transparent competitive process, to commence this summer.
  • The construction of smaller vessels will be set aside for competitive procurement amongst other Canadian shipyards. Under the strategy, the two shipyards selected for the construction of large ships and their affiliated companies will not be eligible to build any of the smaller vessels.
  • Future requirements for ship repair, refit and maintenance will be competed through publicly announced requests for proposals.
  • The new strategy allows for a distribution of benefits to small and medium enterprises though sub-contracting in any of the three streams of work (large ship construction, small ship construction and repair and refit)
  • Once the agreement is put in place with the competitively selected shipyard for a group of vessels, individual ship construction contracts will be negotiated with that shipyard, with ships’ specifications provided by the Department of National Defence or the Canadian Coast Guard.

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