Saturday, June 17, 2006

Tory ex-lobbyist not favouring ex-clients shock! Liberal against no-tender contract shock!

Apparently the Canadian Forces and the Department of National Defence are finalising their procurement requests for Cabinet. Procurement is a vexed subject in Canada as orders are made and then cancelled (Chretien and the EH-101), or equipment sold that it turns out we're now borrowing from others (Mulroney sold CF Chinooks to the Dutch, who are currently providing airlift to Canadian Forces in Afghanistan with the same aircraft).

There seems to be a political consensus now that having the Canadian Forces abroad is a good thing, although there is some dispute about where they should be - the NDP and Lloyd Axworthy wants them in Darfur (where they're not wanted by the Sudanese government) and the Tories and the Ignatieff wing of the Liberals want them in Afghanistan (where they're not wanted by western college students and by the Talibs - though apparently not all of the latter).

In any case, Rick Mercer put it best when he said "if you want people to leave the best place in the world for some of the worst, you have to bring out the Gold Card". The vulnerability of Canadian personnel in the ageing Sea Kings, the inadequate Iltis and the rolling LAV IIIs is getting wide media coverage, as it should be.

Chinooks are back on the wishlist, and let it be hoped that the CF learn from the RAF's order of eight Mark 3 Chinooks in Special Forces configuration, since those Chinooks have been sitting idle for years because of disputes between the British and Boeing over certification of the aircraft. Let's hope the people who bought the Victoria class subs for Canada aren't taking calls from the UK - it's not like Canada has bought lemons that sat idle for years from there before.

In opposition, with the assistance of the Bloc Quebecois Defence spokesman, Gordon O'Connor criticised the intention of the Liberals to seek a single source contract to replace the (C)C-130E/H fleet with new J models from Lockheed. O'Connor's criticisms were put down to his former employment at Hill & Knowlton, an Airbus lobbyist. Airbus were offering the A400M, a larger and faster aircraft than the C-130J but which will not be certified before the 2008 contract deadline. Now in government, O'Connor appears ready to... seek a single source contract from Lockheed! An order of C-17s from Boeing seems likely also.

However, the hypocrisy is mirrored on the Liberal bench, with Ujjal Dosanjh claiming the government shouldn't give a contract to Boeing without competition "unless it is 100 per cent sure that it is the best product available" , whatever that means. As the census controversy showed, Lockheed seems to be in a different class to other American companies when looking for Liberal business.

Airbus are trying to fight back, and their disappointment will be sharpened by the apparent intention to defer the search and rescue requirement for which they were pitching the Spanish CASA 295. Apparently their lobbying includes an offer to give work to Quebec businesses, but it seems a lot of bitterness remains since the Pratt & Whitney Canada PW180 engine was dropped in favour of the TP400 from a European consortium. Airbus appear to tie workshare very closely to orders, for instance a recent announcement that South African company Denel will make parts for A400M in conjunction with Saab only came after a South African commitment to 8 aircraft. However, the Lockheed aircraft doesn't use Canadian engines either.

If deliveries cannot be expected before the rumoured 2014 then Airbus will have to provide interim lift - refurbished C-130s were rumoured - and this isn't mentioned in their release. Lockheed themselves are leasing C-130s to Germany pending delivery of their Airbuses. It's possible a fast order of C-295s to replace the SAR C-130s could stretch the life of the latter fleet but this seems to be off the table. The C-295s have Canadian engines which may help its chances but the rival Lockheed/Alenia offering would have engine commonality with the C-130J fleet.

In reality, this is all too little too late. The options which could have reorganised CF transport to allow A400M to enter the race weren't taken under the Liberals. The C-130s are needed now, and let us hope the California Senators and Representatives desperately trying to keep the C-17 line open will repay Canada's faith in their product with a gesture of thanks. Let's see if I can think of a way... how about the softwood lumber duty back, including the US$1,000,000,000 currently being negotiated away?
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