You bought the company.
Evidence of meeting #34 for National Defence in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was ships.
A recording is available from Parliament.
Evidence of meeting #34 for National Defence in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was ships.
A recording is available from Parliament.
4:25 p.m.
Liberal
Mark Gerretsen Liberal Kingston and the Islands, ON
In a press release, you called yourself a “centre-of-excellence for federal government ship repair and maintenance”. I'm curious as to how you arrived at that title, because I know that the government had designated both Vancouver and Halifax shipyards as centres of excellence, but I hadn't heard that Davie had been given that same title by the government. I'm curious as to how Davie arrived at that title.
4:25 p.m.
Chairman, Chantier Davie Canada Inc.
We were considering ourselves a centre of excellence because this would be the fifth program in which we had refitted and upgraded one of the heaviest icebreakers for the Canadian government, so we became a centre of excellence in that.
In terms of the actual question, I think the government, under the NSPS umbrella agreement, which is this non-binding framework agreement by which it can negotiate contracts with these two shipyards.... I've lost my train of thought. That doesn't include ship repair. That's only for shipbuilding projects, so all ship repair in-service support for the future naval fleet and for the existing naval fleet will be publicly competed and openly competed.
4:30 p.m.
Liberal
Mark Gerretsen Liberal Kingston and the Islands, ON
Okay. In the same press release, Davie noted that it has the highest capacity and is the most experienced shipyard.
Can you explain the metrics for how you came to state that?
4:30 p.m.
Chairman, Chantier Davie Canada Inc.
In terms of capacity, it's quite evident just in terms of size. You can analyze that based on steel production capability or ship-berthing infrastructure.
Sorry, what was the second part?
4:30 p.m.
Liberal
Mark Gerretsen Liberal Kingston and the Islands, ON
I'm just curious, in making the claim that you're the highest-capacity and most experienced shipyard, how you—
4:30 p.m.
Chairman, Chantier Davie Canada Inc.
In terms of being the most experienced, if you look at Davie, it's the only shipyard in Canada that's still around today that's actually built warships. It's built over 700 vessels. It's built large warships.
4:30 p.m.
Liberal
Mark Gerretsen Liberal Kingston and the Islands, ON
Is it safe to say that's how you came to that claim?
4:30 p.m.
Chairman, Chantier Davie Canada Inc.
It's built more ships than a lot of shipyards around the world.
4:30 p.m.
Liberal
Mark Gerretsen Liberal Kingston and the Islands, ON
Okay.
I have just one more question on safety. You can appreciate that the government finds that to be paramount, as would all Canadians, and I'm sure you would agree. I understand that Davie recently offered to provide the federal government, through an unsolicited bid, this supply ship to carry oil. Oil normally is carried by a double hull ship. This ship is not a double hull ship.
4:30 p.m.
Chairman, Chantier Davie Canada Inc.
You don't build non-double hull tankers anymore.
4:30 p.m.
Liberal
Mark Gerretsen Liberal Kingston and the Islands, ON
You did not request the federal government to exempt the ship from a double hull requirement.
4:30 p.m.
Conservative
Pierre Paul-Hus Conservative Charlesbourg—Haute-Saint-Charles, QC
Thank you, Mr. Chair.
Good afternoon everyone. Since I am a member from Quebec, I have been familiar with the Davie shipyard for a long time. I also worked in Lévis for a long time.
There have been more difficult years for the shipyard, but I think that for several years now, since the acquisition, things have been going very well, and everything is in place for what is going to be done.
There is a lot of talk about the National Shipbuilding Strategy. The process was created to facilitate management and remove the political aspect from the files, so that shipyards would function better. But there are still some issues. I don't remember whether it was Mr. Fraser or Mr. Vicefield who said that everything was going well with the civil service.
If the political aspect has been removed through the strategy and if everything is going well with the civil service, can you tell me what the issue is, currently?
4:30 p.m.
Chief Executive Officer, Federal Fleet Services Inc.
Thank you for the question.
This is what I want to say. Mr. Gerretsen mentioned earlier that when public servants change their minds or viewpoints, things happen and problems arise.
Personnaly, I do not approve of the concept behind this manoeuvre. I know what is going on, which is that people are responding to political demands. In my opinion this takes us back to the notion of capacity. In his chapter 10, Mr. Emerson clearly says that capacity is insufficient. The Canadian Coast Guard fleets are rusting out and will not be replaced in time.
We are not here to attack our colleagues from the west coast, but to let it be known that we have the necessary capacity and that we are willing to propose solutions to the government. It is up to the government to decide whether it wants to wait 10, 15 or 20 years before applying solutions that could be applied immediately.
4:30 p.m.
Conservative
Pierre Paul-Hus Conservative Charlesbourg—Haute-Saint-Charles, QC
Are you implying that the political sector is still involved?
The political decision consists in determining whether we invest and whether we have the billions of dollars needed to do so. From the moment when the government gives the go-ahead, everything should unfold according to the strategy.
Do we agree on that?
4:30 p.m.
Chairman, Chantier Davie Canada Inc.
I think it's the reform that's needed now. That's where politicians need to play a role, in actually reforming it and acknowledging that it has issues.
As Spencer and I have both said, we've had a fantastic experience with the civil service, with the guys at Public Services and Procurement Canada now, in the award of the contract and work on the contract, but I think there is still this leftover of people who are gripping to the policies of yesteryear when they are proven not to work. They're still holding strong onto that and saying, “You know, our policy was good from the beginning.”
I don't think it needs to be like that. Things do change. You have a new situation in the Canadian shipbuilding industry today, and the program needs to take account of that.
4:35 p.m.
Conservative
Pierre Paul-Hus Conservative Charlesbourg—Haute-Saint-Charles, QC
Very well.
My next question is not about the government context. Canadian shipyards have a lot of trouble obtaining foreign contracts.
Could you explain to me why Canada cannot obtain contracts from the private sector abroad, or military contracts from other countries? Why must we always depend on the Canadian government?
4:35 p.m.
Chief Executive Officer, Federal Fleet Services Inc.
Thank you for the question.
On this I can speak to our current situation. I thanked the Government of Canada because it is helping us at this time. Indeed, three allied countries are considering our ships. We're not talking here about a 5- or 10-year horizon. We are producing a vessel at a competitive price, as compared to those produced by other countries.
In my previous position I exported Canadian high-tech products to 15 countries. We won everywhere. We are approaching what we want to do here in Canada with the same vigor.
Earlier, I spoke of
the costing and profit policy.
If the government does not resolve this, shipyards that only execute government contracts will never be competitive internationally.
Take, for instance, an icebreaker that costs $1.7 billion, but can be purchased for $700 million in Europe.
4:35 p.m.
Conservative
