Evidence of meeting #180 for Government Operations and Estimates in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was departments.
A recording is available from Parliament.
Deputy Minister, Public Services and Procurement Canada, Department of Public Works and Government Services
My understanding of dates, at their current stage, Mr. Chair, is that 2023 and 2025 are the two dates that are in play. For costing, I'll have to turn to my colleague André, or maybe you'll give us 30 seconds.
Assistant Deputy Minister, Defence and Marine Procurement, Acquisitions Program, Department of Public Works and Government Services
The budget remains at $3.4 billion, and we're about to start negotiations for the construction contracts with the yard.
Conservative
Kelly McCauley Conservative Edmonton West, AB
I know we're using the Berlin design. Have we finalized the Canadianization of the changes for it?
Assistant Deputy Minister, Defence and Marine Procurement, Acquisitions Program, Department of Public Works and Government Services
It is being finalized, and again, back to the re—
Conservative
Assistant Deputy Minister, Defence and Marine Procurement, Acquisitions Program, Department of Public Works and Government Services
I said it is being.
Conservative
Assistant Deputy Minister, Defence and Marine Procurement, Acquisitions Program, Department of Public Works and Government Services
Again, going back to the resequencing question you had earlier for us, it was also about putting all efforts on the joint ship design work—getting it done so that we could start construction—and then spending more time on the offshore oceanic science vessel. All efforts are now on the joint supply ship design work, to complete the design work and start construction next year. I can say that construction on some of the blocks has already started, but the full construction contract negotiation will be ending in early 2020.
Conservative
Kelly McCauley Conservative Edmonton West, AB
Can we assume that when the polar icebreaker is re-awarded, it will fall under the build in Canada policy and will be built in Canada?
Deputy Minister, Public Services and Procurement Canada, Department of Public Works and Government Services
The Government of Canada has a build in Canada policy, so that's what we're working with.
Conservative
Kelly McCauley Conservative Edmonton West, AB
Yes, so we can assume, then, it will be awarded to another shipbuilder?
Deputy Minister, Public Services and Procurement Canada, Department of Public Works and Government Services
All options are on the table.
Deputy Minister, Public Services and Procurement Canada, Department of Public Works and Government Services
Well, all options are on the table, but there's a build in Canada policy in play.
Conservative
Kelly McCauley Conservative Edmonton West, AB
I have just a couple of quick last questions.
Is the CSC going to be on a cost-plus basis? Or is it going to be with a price ceiling like the first three AOPS were, in my understanding? How's that going to be done? It's the same with the joint supply ships.
Assistant Deputy Minister, Defence and Marine Procurement, Acquisitions Program, Department of Public Works and Government Services
On the two different contexts—
Assistant Deputy Minister, Defence and Marine Procurement, Acquisitions Program, Department of Public Works and Government Services
On the CSC, I think it's fair to say that the early ships will still be in the design and prototype kind of stage and that you can expect a base payment that will be more along the lines of time and materials, which is a typical approach internationally. As we mature—
Conservative
Kelly McCauley Conservative Edmonton West, AB
Time and material, so it's more along a cost-plus basis.
Assistant Deputy Minister, Defence and Marine Procurement, Acquisitions Program, Department of Public Works and Government Services
It's so that we can establish parameters that can allow us to go more into a performance-based contracting approach with incentive fees and, eventually, potentially even with a fixed price for the production line. This is an approach that is used—
Conservative
Kelly McCauley Conservative Edmonton West, AB
My understanding is that the first three were going to be cost-plus, and then after that a price ceiling with incentives. Is that correct?
Assistant Deputy Minister, Defence and Marine Procurement, Acquisitions Program, Department of Public Works and Government Services
Correct. It has not been decided yet, but what I can say is that the early ships will have—
Assistant Deputy Minister, Defence and Marine Procurement, Acquisitions Program, Department of Public Works and Government Services
The early.... The first, second and third of the 15 ships will still be in a stage where we're trying to learn about building them, and the base payment will evolve as we mature the construction processes and we'll go towards—
Conservative
Kelly McCauley Conservative Edmonton West, AB
I'm missing something here. With the first three ships, we haven't decided how we will be paying or how Irving will be reimbursed?