Halifax shipyard says warship ‘gap’ could result in layoffs without federal help

Shipyard says 'gap' could result in layoffs

OTTAWA — Halifax-based Irving Shipbuilding says it is in talks with the federal government over a looming gap in construction of two new fleets of ships for the navy, which the company warns could result in “significant layoffs” if left unaddressed.

The shipyard wants the government to give it additional work to make sure workers don’t sit idle between when the first fleet of Arctic patrol vessels is finished and work begins on the second fleet of much larger warships.

Work on the Arctic patrol ships is expected to wind down in 2019.

Construction of the warship fleet — which will replace the navy’s frigates and destroyers — won’t start until at least 2021.

Irving president Kevin McCoy says they are anticipating a construction gap and looking to the government for help in filling it in order to stave off job cuts.

McCoy’s comments underline the real costs of years of debate, delays and hand-wringing over the multi-billion-dollar warship project, in particular, which is the single largest military procurement project in Canadian history.

“We know there is going to be some kind of a gap, and we’re looking at the government about what makes sense for work during that period,” McCoy said in an interview Thursday.

McCoy later told the House of Commons defence committee that the gap could result in “significant layoffs.”

The surprise suspension last month of the military’s second-highest-ranking officer has thrown another potential wrench in the mix. Vice-Admiral Mark Norman was deeply involved in the warship project in his previous role as commander of the Royal Canadian Navy.

Defence Minister Harjit Sajjan has said Norman’s suspension was not related to national security, which has left many questioning whether there was any link to the federal government’s shipbuilding plan.

McCoy said Irving does not know why Norman was stripped of his duties as vice chief of defence staff on Jan. 16, but he maintained it has not had any impact on the work the shipyard is doing.

“We have not been notified. We have no knowledge. Nor is it impacting any of the procurements that we’re leading,” he said. “We are pressing forward.”

Irving currently has about 850 employees working directly on the Arctic patrol vessels, McCoy said, many of whom were recruited and trained specifically for the federal shipbuilding program.

Not only would a gap mean no work for many for an extended period of time, McCoy said there is the risk some will leave Halifax and Canada for jobs elsewhere.

“If we have a downturn in employment and they decide to leave, then we’re going to have to replace those folks,” he said. “New training, new recruiting and that will be a cost to the (warship program).”

Irving recently pitched the idea of building a ship specifically designed to respond to humanitarian crises, while McCoy said the company would like a maintenance contract for the navy’s frigates extended.

The current maintenance contract expires in 2018, but McCoy said the company is well-positioned to continue, given that it recently completed a major refit of the frigate fleet.

Irving recently bid for a $5-billion maintenance contract for the Arctic patrol vessels and the navy’s new resupply ships, but industry insiders say French defence giant Thales was selected as the winner.

In response to McCoy’s comments, a spokeswoman for Public Procurement Minister Judy Foote reaffirmed the economic goals of the federal shipbuilding strategy.

“The National Shipbuilding Strategy was designed to eliminate the boom and bust cycles that dominated the industry in the past,” spokeswoman Annie Trepanier said in an email.

“The NSS is a long-term commitment to shipbuilding that will rejuvenate our marine industry, support Canadian technological innovation, and bring jobs and prosperity to many communities across the country.”

Irving was selected in 2010 to construct between six and eight Arctic patrol vessels for $2.3 billion and 15 warships, known in defence circles as Canadian surface combatants (CSC), for $26 billion.

Both projects have since been amended due to scheduling and cost issues. Irving is now committed to building five Arctic ships, though it may add a sixth. McCoy said that decision will come at a later date.

Meanwhile, the Liberal government said it would not discuss a price or how many warships it will buy until more information is available, after documents showed they could cost $40 billion.

— Follow @leeberthiaume on Twitter

 

Lee Berthiaume, The Canadian Press

Canadian Press

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

‘Unusual smell in water’ not a health concern, says City of Abbotsford

Odour is just temporary due to treatment-plant maintenance, city says

‘Agitated’ man pulls out knife on 3 people in Abbotsford

Witnesses sought for incident on Monday night near city hall

Man charged with hit-and-run that killed pedestrian in Abbotsford

Man in his 50s died after being struck by vehicle on Highway 11 in October 2019

Fraser Valley Bandits reflect on 2020 turnaround

Abbotsford-based CEBL team goes from worst to almost first at Summer Series

Vedder River gets reprieve from gravel removal this summer

Applications withdrawn by river management committee and process concluded for 2020

DFO says five aggrieved B.C First Nations were consulted on fisheries plan

Nuu-chah-nulth First Nations calls response ‘a sham,’ adding DFO never incorporates their views

Friends do ‘amazing’ home makeover for retired police officer

Pitt Meadows RCMP veteran was away getting treatment for PTSD

Canucks ride momentum into NHL playoff series against defending Stanley Cup champs

PREVIEW: Vancouver opens against St. Louis on Wednesday

Pitt Meadows woman gives birth on in-laws’ driveway

Frédérique Gagnon new son is appropriately named after Norse trickster god

Man, 54, charged in connection with fatal attack of Red Deer doctor

Doctor was killed in his walk-in clinic on Monday

One dead as fish boat sinks off southern Vancouver Island

Shawnigan Lake-registered Arctic Fox II went down off Cape Flattery, west of Victoria

VIDEO: B.C. community rallies to save snared eagle

Revelstoke climber scales tree to save the raptor

42 more people test positive for COVID-19 in B.C.

The province has recorded no new deaths in recent days

Most Read