Preserving capacity, General Tom Lawson, Chief of the Defence Staff, Keys to Canadian SAR
Issue link: http://vanguardcanada.uberflip.com/i/139409
S Shipbuilding Command team from HMCS Halifax in a rigid hulled inflatable boat and (below) Task Group Commander, Captain Art McDonald, during Op Hestia. Photo: Cpl Johanie Maheu Second, despite the impressive price tag of the shipbuilding contracts, Canada will build relatively few ships. In effect, Canada will not be able to benefit from the economies of scales or economies of experience that result from sustained large-scale production. Third, with so few types of ships being built, Canada will not be able to distribute the cost of designing the ships across a large number of vessels. Hence, the design phase of the NSPS is dramatically more expensive than it would be by acquiring ships already in production abroad. For some, the added cost associated with a "made in Canada" strategy could be reason enough to buy off-the-shelf ships. Be that as it may, I would argue that a Canadian shipbuilding project such as the NSPS remains the best option for political, economic and strategic factors. The first dimension to consider in this respect is the political sphere. Although we often tend to forget, it is politicians and public servants that ultimately decide if, when and how many ships will be procured to replace the aging RCN fleet. The principal worry of any politician in a democracy is to get elected. Before principles and values, before even grand strategies and national interests, the desire to hold the reins of government is the most stable and best predictor of a politician's decisions. 40 JUNE/JULY 2013 www.vanguardcanada.com Through this lens, the NSPS is a political godsend, the capacity to spend billions of dollars over a large number of years (roughly 25 at this point) and thus reap the political benefits of multiple photo-ops, ribbon cutting events and announcements. The actual size of the NSPS, however, limits the capacity of any government to seriously consider foreign options in procurement. No federal government would be able or willing to argue to Canadian voters that they have made the decision to spend $33 billion of taxpayer money abroad. Since the NSPS effectively bundles together the procurement of the new RCN ships, the federal government has its hands tied to a "build at home" strategy. Furthermore, the NSPS is a classic case of a collective action problem. The made-in-Canada strategy will benefit a small percentage of Canadians, namely those from the Maritime provinces and, to some extent, British Columbia. These voters will be especially sensitive to any attempts to remove those benefits – by procuring the ships abroad, for example – and will enact considerable political pressure on Ottawa. Quite the reverse, the added cost of the made-in-Canada strategy is shared and distributed by a larger number of Canadians, which will seldom spend their political capital to convince politicians to select a cheaper alternative, i.e., off-the-shelf foreign built vessels. From the perspective of politicians, it is almost impossible to reverse the decision to build the new RCN fleet in Canada. The second dimension to consider is the economic imperatives of the NSPS. First, by focusing on a "build in Canada" strategy, the NSPS will provide important direct and indirect economic spinoffs for the Canadian economy. We should be weary of extravagant claims of massive economic benefits that are not supported by actual studies of such procurement process, but estimates vary from a projected $1.6 to $2.4 billion annually, with a yield of approximately 10,000 to 15,000 jobs. These figures are probably an exaggeration, nevertheless, it is important to understand that these economic incidentals would be reaped mostly in the Atlantic provinces, a region where economic good news has been few and far between in the last de-