Government Operations Committee on March 25th, 2022

[Simon Page]

Mr. Chair, maybe I'll start, and then I'll ask Mr. Smith and Mr. Crosby to speak about their respective AOPS portion.

From a process point of view, as we mentioned, with the AOPS program one through six, we had really good momentum established with Irving Shipbuilding on the east coast. The navy accepted one. They accepted two. Three was—

[Kelly McCauley, Conservative, Edmonton West, AB]

Sir, I'm aware of all that.

We're short on time. Could you please just stick to answering the question?

[Simon Page]

We had very good momentum building, and then the pandemic happened. We lost that momentum. We are grateful for the shipyards to have remained operational during the pandemic. It could have been worse. ISI had to shut down. We really felt at number four—

[Kelly McCauley, Conservative, Edmonton West, AB]

Mr. Page, how long did they shut down for, please?

[Simon Page]

They shut down for a few weeks, Mr. Chair.

[Kelly McCauley, Conservative, Edmonton West, AB]

It was a few weeks. So we're looking at an almost tripling of a price because of two weeks lost.

The reason I'm bringing that up is that I'm looking at a forensics from a company. Fincantieri shut down for a couple of weeks. With the U.S. Navy, there were no major disruptions. Several were encouraging employees to work from home.

We've heard repeatedly excuse after excuse after excuse, “Oh, it was COVID.” ISI shut down for two weeks out of a two-year period, and you're blaming a tripling of cost on two weeks. I do not find that acceptable. I don't think taxpayers find that acceptable. I don't think the men and women in our navy find these continual delays acceptable, blaming it on COVID.

I'd like you to provide to this committee, in writing, an exact breakdown, from both shipyards, on how many hours were lost, by month, please, due to COVID, because I do not believe your excuse of COVID for these massive cost overruns and delays.

[The Chair, Conservative, Robert Gordon Kitchen]

Thank you, Mr. McCauley.

Mr. Page, if you can submit that to the clerk, he will distribute it to the committee. Thank you.

We'll now go to Mr. Jowhari for four minutes.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Thank you, Mr. Chair.

Thank you, witnesses, for your testimony today.

As our time is short, I'll cut to the chase.

We know there have been increased costs, so going forward and looking forward, what measures are we putting in place to track progress, to monitor and to report?

In preparation for the meeting, I was looking at the sources tracking the progress updates and I noticed there is a decentralized and collaborative approach taken in the national shipbuilding strategy. I found out there are multiple sources reporting on the progress and different projects that stem from this initiative.

Is there any centralized source that reports on all of these projects? If not, can you kindly give us an update on the best way to get a holistic and comprehensive report that talks about material and labour costs as well as progress and where we are, along with any challenges or highlights that have been flagged?

That's for either Mr. Page or Mr. Crosby. If Mr. Smith or Admiral Baines want to make any comments, I'll be glad to hear those.

[Simon Page]

Mr. Chair, again, through our governance we manage the national shipbuilding strategy as a strategy, so we look at different measures at this level. We also manage at the program level, shipyard by shipyard. We have specific governance with the shipyards to manage their respective programs of work, and we manage and report at the project level, so project by project, according to their specific authorities and accountabilities.

The programs of work from one coast to another as well as the challenges are not the same, so sometimes it's difficult to really have the same discussions with the same mechanisms for resolution; however, we do take a holistic approach at the strategy level.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Thank you.

Is there a single dashboard, perhaps broken down into different projects, and therefore a centralized source for reporting on progress that we could get access to?

[Simon Page]

An overall NSS dashboard does not currently exist. We do monitor measures for the strategy, but those are not project by project.

We do have what I would call a central benchmarking or central view of programs of work in the respective shipyards. Those are managed on a monthly basis at regular governance meetings.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Thank you.

On February 4 we heard from the Auditor General, who talked about the need for strict monitoring and oversight. Can you clarify how your team along with the shipyards and other suppliers oversee the construction and delivery of the ships to NSS to ensure that we have proper oversight on these projects?

[Simon Page]

We do exercise rigid oversight on all our projects and programs. Since the OAG report, we have embraced all recommendations.

There was a specific recommendation about managing in a more comprehensive and meticulous way the schedules, costs and scope of the project. We're using the earned value management tool to do this.

We've also increased the level of risk management that we exercise on the projects, the programs with the shipyard, and the strategy writ large, and we have integrated risk management discussions within all levels of governance.

[The Chair, Conservative, Robert Gordon Kitchen]

Thank you, Mr. Page.

We'll now go to Ms. Vignola for two minutes.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you very much, Mr. Chair.

Canada has purchased six Arctic patrol ships for the Department of National Defence that will not be able to go to the Arctic in the winter. They are called icebreakers, but they are not designed well enough to break ice in winter.

Canada has purchased two more for the Canadian Coast Guard, with the same hull, according to what was said earlier, but they will only be able to patrol from August to October, because they are not designed to break ice.

How can you make icebreakers that don't break ice?

Why haven't we had icebreakers built that can do their job year-round? After all, we need year-round data and protection.

[Andy Smith]

I think it needs to be understood initially that the AOPS are ice-capable, not icebreakers. There's a fundamental difference there.

As it relates to the Coast Guard mission set, the two AOPS Coast Guard variants will have primary missions of offshore search and rescue and conservation and protection for the Northwest Atlantic Fisheries Organization. They will have secondary missions to enable science and ice track maintenance. For example, on Lac Saint-Pierre, once the icebreaking track has been made by an icebreaker, the AOPS service for the Coast Guard will be able to maintain that track.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Please excuse me, Mr. Smith, but I was talking about the Arctic patrol ships. I'm going to ask my question differently.

What are the deadlines for when ships can go to the Arctic?

[Andy Smith]

There's a very well-established entry into the Arctic regime, much as there is for the naval variants or the AOPS. It depends on where in the Arctic, in fairness, but I think any time past late September would be a limiting date for their entry into the Arctic.

[The Chair, Conservative, Robert Gordon Kitchen]

Thank you very much, Mr. Smith. By all means, if you think of anything else, you can add to that answer, if you feel you need to.

We'll now go to Mr. Johns for two minutes.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Thank you, Mr. Chair.

Thank you all again.

Mr. Smith, I worked with Mr. Girouard and Ms. Thomas, when they were the previous Pacific region Coast Guard deputy commissioners, on the development of the Coastal Nations Coast Guard Auxiliary program. I was really grateful to see a couple of vessels come out, just last month actually, to serve our coast. We know how important it is to provide resources to indigenous peoples, who are more likely to respond even before the Coast Guard can in many cases.

Can you provide any updates to this committee about new vessels you're going to be adding to the indigenous auxiliary fleet and about what's going on with the Pacheedaht? I know they've been waiting anxiously for that station to be implemented, and it's critical to protecting the west coast.

[Andy Smith]

Mr. Chair, with respect to the engagement with the indigenous populations on the west coast, we have an active program. The community boats program is an active program the Coast Guard is moving out. That's part of the oceans protection plan. Additionally, we continue to build the search and rescue lifeboats, and some of those will be deployed to the west coast.

With respect to the Pacheedaht, it's not my area per se. I'm aware that there is an initiative going forward to work with the Pacheedaht. However, for specifics on that, I'd have to take that question on notice.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Thank you. I think there's some sense of urgency to get that project up and running, especially when it comes to ensuring the safety of our coast and making sure those indigenous communities have those resources.

Has the issue of the midships the Coast Guard had, which had a rocking issue due to the lack of a stabilizer, been addressed? How are you going to make sure we don't have that issue come up again as we did a couple of years back?

[Andy Smith]

Mr. Chair, I just want to make sure I understand the question.

Are you talking about the midshore patrol vessels we have?

[Gord Johns, NDP, Courtenay—Alberni, BC]

Yes. There was a huge issue, as you remember, with the ballast. They had rocking issues that were making staff and crew sick.

[Andy Smith]

First of all—