According to a report published by the Parliamentary Budget Officer’s estimate, the anticipated cost of the Royal Canadian Navy’s new surface combatant ships has increased because of delays and an increase in the size of the ship.
According to the report, the estimation sees total cost of the CSC program is $69.8 billion over 26 years, consisting of $5.3 billion in pre-production costs; $53.2 billion in production costs; and, $11.4 billion in project-wide costs.
In the previous cost analysis, the government hadn’t selected a design for the new generation of warships; Therefore, this new report considered characteristics specific to the Type 26 design chosen by the government while incorporating updated information on the project’s timeline.
The construction is planned to begin in the years following, and the The Parliamentary Budget Officer warns that any delays in building the first ship will be costly. A delay of one year could increase costs by almost $2.2 billion.
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In addition, during 2017, the Government of Canada revised their original 2008 program cost estimate of $26.2 billion to $56-60 billion, with costs to be revisited at the completion of the development phase.
The Canadian government announced in October 2018 that BAE type 26 was chosen for the project to replace the navy’s aging fleet of frigates. The new 150-meter (492-foot) vessels will replace the Iroquois and Halifax-class warships and provide air defense, anti-submarine warfare and anti-shipping capability. Lockheed Martin Canada is partnering with BAE Systems, and Irving Shipbuilding has been nominated as shipbuilder.
The Canadian Surface Combatant project is the largest, most complex procurement ever undertaken by the Government of Canada.
