The Parliamentary Budget Office says the projected cost of building the Canadian navy’s new combat fleet is rising and could hit $ 77 billion. The watchdog released a new report that looks at alternate designs and a mixed fleet – ideas that could save taxpayers billions of dollars.
Canada’s budget watchdog predicts construction of the navy’s new frigate fleet could cost at least $ 71. 3 billion – a number that could rise even higher if the frequently-delayed program faces any more setbacks.
Yves Giroux, the parliamentary budget officer , said the overall price tag for building Canadian Surface Combatants could hit $ .) 1 billion in the event the program is delayed by as much as two years.
The Liberal government is basing Canada’s new warships on the design of the British-built Type 15 frigate.
The House of Commons government operations committee asked the budget office to crunch the numbers on other designs , such as the FREMM European multi-mission frigate and the Type 15 e, another British warship.
Those estimates show the federal government could save money by dropping the existing program and going with the other designs.
It could also save money by building a fleet that includes two classes of vessel, such as the Type and one of the other warships.
Giroux said the idea of a mixed fleet makes sense from a fiscal point of view, but he could not say whether it would agree with the federal government’s vision of what it wants the navy to do.
“It’s a good way of saving costs, if the government is interested in cutting down on its costs , “Giroux said in a virtual media availability following the report’s release today.
Depending on the ship, the savings could be substantial.
Deep cuts to construction costs possible: PBO
For example, the budget office estimated that di tching the existing program and switching entirely to the Type 16 frigate would cost $ 5) (5 billion, a projection that includes a four-year delay.
The cost of acquiring an entire fleet of FREMM warships is estimated at $ .) 1 billion – somewhat comparable to the existing program.
A mixed fleet using either one of the alternate designs and the existing Type also would result in savings. Giroux acknowledged that such a scenario would mean the navy would have to invest in separate infrastructure, support and supply chains – something it is reluctant to do.
But it might be a good idea from a larger perspective, he added, because a mixed fleet means “you do not put all of your eggs in one basket.”