Tag Archives: F-35 Fighters

Roundup: The Carney conundrum

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The Globe and Mail wrote a story that tried to paint a picture of how Liberals were wooing Mark Carney, and that while he spoke at an exclusive event in Nova Scotia, he spent a few days at Scott Brison’s house with his family. And *gasp!* they both talked about income inequality at one time! Nobody else ever talks about income inequality – never! They must have been in cahoots about getting Carney to run for the party leadership! Never mind that they have a lot of similarities in experience and circles that they both travel in. The problem is that the story is largely sourced by unnamed “officials” and is dependent upon one particular organizer who was trying to get Carney to run and who may have simply been spinning a fabulation that Carney was actually entertaining a bid while he tried to get an organization behind him that was based on a false understanding of how the leadership ballot process was being run. It’s a bunch of random information being strung together with a bunch of supposition that something might have been discussed, because nobody wants to talk about it. And from a journalistic perspective, it reads a lot like rumour being reported as fact – especially with almost nobody going on the record to confirm or deny anything.

Whether the events in the story are true or not is no longer the issue, however. Economist Stephen Gordon worries about the irreparable harm that the Carney story does for the office of the Governor of the Bank of Canada, simply so that some “senior Liberal sources” could try and find some imagined gain.

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Senate QP: One last kick at the F-35s

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Admittedly I got to the Senate chamber late (and it was a bit of a miracle that I made it at all this morning), and when I made it, Question Period was already underway. After missing a question on a local Nova Scotia concerns from Senator Mercer, which Senator LeBreton took under advisement, I came in while Senator Dallaire was on his feet, asking about the government’s messaging on the issue of Syria, and Canada’s capacitor for peacekeeping operations considering the ongoing commitments in Afghanistan and the Canadian Forces currently “licking their wounds.” Senator LeBreton, answering for the government as is what happens in the Senate, responded with her usual derision and withering sarcasm, decrying that Dallaire — a decorated retired Lieutenant General — could “insult” the Forces by using the term “licking their wounds,” and then praised the work of John Baird as minister of foreign affairs.

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Senate QP: What about that billion dollar penalty?

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With the Commons now risen for the season, the Senate is still hard at work, and they had plenty of questions for the government – especially in the wake of yesterday’s F-35 report being tabled. Liberal senators took it upon themselves to put questions on that report to the government, by way of Senator Marjorie LeBreton, the Leader of the Government in the Senate.

Senator Cowan led off, quoting Andrew Coyne’s withering analysis on the F-35s, and he asked what it will take for the government to admit they misled Parliament. Senator LeBreton replied that the “ramblings” of Andrew Coyne mean little to her, and that the government’s assurances on the file have born out — which the Liberal benches found hilarious. She then quoted the false 42-year figure, saying they were the same as the twenty-year figure, and was completely attributable to the time frame. When Cowan pressed about Ambrose’s statements versus those of MacKay, LeBreton got a chance to recite the “no money has been spent” and “Seven-Point Plan™” talking points. Cowan wasn’t about to let go, and pressed on about a statement that MacKay made about how cancelling the F-35s would cost us a billion dollars, and what that actually entailed. LeBreton kept talking around it, despite several back-and-forths. Senator Wallin then stood up to ask a friendly supplemental question to take the heat off, and got LeBreton to quote some KPMG figures.

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Roundup: MPs head home while the F-35 storm rages on

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The House has risen, and the MPs are all headed back to their ridings. Not the Senate though – they’re still sitting, and I’ll be heading up their for Senate QP later today.

Okay, so now the big news from yesterday – the KPMG report on the F-35 procurement process. With a cost now pegged at $46 billion over 42 years, the government says that it’s officially pushing the reset button on the process – or is it? The former ADM of procurement at National Defence, Alan Williams, says that it’s meaningless unless the department redraws the Statement of Requirements to make stealth a “rated feature” with a point value rather than a pass/fail and it then goes for open tender. There’s also the problem of attrition and the additional costs of buying replacement aircraft, which is outside of the $9 billion procurement envelope being set. John Geddes rips apart Peter MacKay’s remorseless performance yesterday, and notes that the officials noted that it will be difficult to keep the aerospace contracts for supplying F-35 parts if we don’t end up going with that plane. John Ivison goes through the process and finds that if the Conservatives still end up going with the F-35s, it will look like incompetence. Andrew Coyne takes offence that the government continues to spin the numbers and calls bullshit – it’s not 42 years, but $46 million over 30 years, and that the government tacked on those extra 12 years to cover “development and acquisition,” which costs a few hundred million, but by making it look like a little over a billion dollars a year, the government is trying to make it look more palatable. Paul Wells notes the Conservatives’ tendency toward hubris when they should be listening to their critics, who do have a point. Of course, the US “fiscal cliff” may end up killing the F-35s as it would slash their defence spending.

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QP: Angry questions in advance of the KPMG report

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What was likely the final QP of the year was very nearly a full house in the Commons, and saw the arrival of the two new Conservative MPs who recently won the by-elections in Durham and Calgary Centre. Once Erin O’Toole and Joan Crockatt took their seats, Thomas Mulcair started off by reading off demands for amendments to the Investment Canada Act, and intimated that the Prime Minister is scaring off investment. Harper pointed out that the markets responded positively to the decision, and hit back about how the NDP would shut down the oil sands. Mulcair then switched tracks and went after the F-35s, to which Harper shrugged and said that the Auditor General’s report found some problems with cost assumptions, but they had this new process going forward. Bob Rae then got up, and took umbrage with Harper’s characterisation of the the Auditor General’s report, and got into a back-and-forth with Harper about what was in the report.

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QP: New MP, same questions

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The calendar running out, and so many things left to bat the government with, it was going to be another fairly testy QP, but before things could get underway, the business or the House paused so that newly elected NDP MP Murray Rankin could be brought into the a chamber to take his seat. When QP got underway, Thomas Mulcair read off a trio of questions about when the government would be clarifying the Investment Canada Act, per the NDP opposition day motion yesterday which the Conservatives agreed to. Harper responded that they already clarified the rules last Friday when they drew the line in the sand around state-owned enterprises — hence why they voted for said motion. Mulcair carried on, asking a pair of questions on the F-35s, and why there were no regional industrial benefits. Harper assured him of the Seven-Point Plan™, and named several companies in Montreal that are benefitting from subcontracts for the plane’s construction. Bob Rae was up next, and pressed about the cost figures for the F-35 purchase. Harper went back to the Seven-Point Plan™, and reminded Rae that when you keep lengthening the service lifetime that the costs will also keep rising.

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Roundup: Investment rules and an eye on joint ventures

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Those new foreign investment rules unveiled by Harper along with the Nexen and Progress Energy decisions will likely have an impact beyond the oil sands – but it’s clear as to how just yet. What it will likely do is involve state-owned enterprises in more joint ventures and having them become minority shareholders to conform to the new rules. Economist Stephen Gordon looks at the economics of investing in the oil sands and why there is a need for foreign investment (and why most of the fears about foreign state-owned enterprises are overblown).

Oh, and those theories that Harper put these markers around state-owned enterprises as a marker for future trade negotiations with China? Paul Wells wonders about the logic of that considering that Canada-China FIPA that’s sitting there, unratified…

On the F-35 file, certain critics say that the promised industrial benefits (currently pegged in the $9 billion range, down from the $12 billion originally stated) aren’t likely to materialise, which is a ticking time bomb for the government. To date those industrial benefits have amounted to less than $500 million.

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QP: Predictable questions on Nexen and the F-35s

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The last sitting Monday of the year was a bit scrappy, but not to the point of rancour. All three leaders were in the House, which I am taking to be a sign that the House will rise before the week is out. Thomas Mulcair angrily read off a trio of questions about the Nexen takeover and accusing Harper of not respecting the rule of law. Harper responded by assuring him that the decisions were made under the current laws and that going forward there would be no more acquisitions by state-owned companies. Matthew Kellway was up next to ask about the leaked numbers from the KPMG audit of the F-35s and demanded an open competition. Ambrose insisted the secretariat was doing just that, and reminded him that the more years you add to the lifecycle, the higher the cost figure grows. Bob Rae pressed on about F-35s, repeating previous government statements about their necessity. Harper gave the party lines about how no money was spent on acquisition and that the CF-18s needed to be replaced. For his final question, Rae asked for the terms and conditions of the CNOOC and Petronas purchases to be made public. Harper reminded him that it was not yet the proper time to do so, as there are confidential commercial concerns.

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Roundup: That “worrying trend” in the oil sands

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Industry minister Christian Paradis said there was a “worrying trend” in oil sands development, which is why they’ve drawn their line in the sand about state-owned enterprises – err, barring any yet-undefined “exceptional circumstances.” Meanwhile, Alison Redford is pleased with the decision, but wants clarity around some of the conditions, especially when it comes to corporate governance. In case you were wondering, here is a timeline of the Nexen and Progress Energy takeovers.

Changes to medical marijuana regulations may end up putting the onus more squarely on doctors to make prescriptions rather than requiring Health Canada approval – which seems entirely consistent with Leona Aglukkaq’s unspoken mandate to divest Health Canada of any and all responsibility for anything.

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Roundup: A very big decision while a firestorm rages

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The government has decided to allow both the CNOOC-Nexen and Petronas-Progress Energy takeovers go through, but with the warning that henceforth, no more state-owned enterprises will really be allowed to invest in the oil sands barring “exceptional circumstances.”  And the fact that Harper himself held a press conference and took questions for thirty minutes – something he never does – means that this was really a Very Big Deal. And yes, the NDP are opposed, in case you were wondering. In advance of the decision, Macleans.ca had a Q&A that explains the review process and what it all means. Here’s a look at Nexen’s market share in Canada. Andrew Coyne notes how big of a mess the foreign investment rules are going forward.

As the renewed firestorm over the F-35s continues – John Ivison now reporting that the KPMG report says they’ll cost nearly $46 billion to purchase – word has it that the government will have four independent monitors to vet the process, including the retired RCAF commander of the Libya mission, and University of Ottawa professor Philippe Lagassé – not that this is confirmed yet. Lagassé, incidentally, also wrote an op-ed yesterday that highlights the systemic procurement problems at DND, and concludes that the Canadian Forces won’t be able to fully recapitalise its fleets and assets unless they get a significant budget increase once the deficit is slain. John Geddes notes that a panel is one thing, but the hard work of what plane to get is quite another. Andrew Coyne says that the entire debacle has proved to be a failure for democratic accountability, as every mechanism we have to ensure it has been evaded, subverted or ignored.

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