The Liberal government’s new defence plan potentially compromises national security by relying too much on private contractors to maintain the country’s new warships, public service unions have warned Prime Minister Justin Trudeau.
The unions are concerned companies will hold too much control over the proprietary rights to equipment on board the ships, limiting what defence department workers and Canadian military personnel can do to maintain the vessels and their systems.
The Liberal government has already encountered that problem. In April it quietly cancelled a tender for a maintenance support contract for the upgraded Halifax-class warships because of concerns over intellectual property rights for the on-board equipment. It has yet to determine how to proceed in that situation.
The June 23 letter to Trudeau from the Public Service Alliance of Canada and the Union of National Defence Employees comes as the Liberals prepare to award a $5.2-billion maintenance contract. That deal would see a Canadian subsidiary of a French defence firm Thales become responsible for the maintenance on the navy’s new Arctic Offshore Patrol Ships as well as its new supply vessels.
But the unions are telling Trudeau that the deal, and future ones like it, could prove to be a disaster, similar to the problem-plagued Phoenix federal pay system.
“As we have learned with expensive public contracts like Phoenix, mismanaged contacts can have significant adverse effects both on the department as well as the broader public service,” Robyn Benson, president of PSAC and John MacLennan, head of UNDE, wrote to Trudeau. “Within DND, this is compounded by the potential compromising of our national security apparatus by private industry and clear security risks in under-investing in our own core capabilities.”
The prime minister’s office did not immediately respond to a request for comment.
The unions are worried that once private contractors take on significant roles in maintaining the ships, the knowledge and skills built up over the decades among the federal workforce will gradually decrease. That, in turn, will prompt the government to hire more contractors.
Military staff and federal workers will also be limited in what they can do because of the maintenance deals with private firms. “We won’t be able to touch the new equipment,” MacLennan said in an interview. “The companies will own all the intellectual property.”
The federal government had earlier been warned by DND that its strategy of having one firm in charge of maintenance for both the supply ships and Arctic patrol vessels could cost taxpayers more money in the long run, according to documents obtained by the Ottawa Citizen.
Selecting one company for a single in-service support (ISS) contract covering two types of ships could give one firm too much control, warned an April 2012 DND briefing note for then-deputy minister Robert Fonberg. “A single ISS provider may assume a ‘take it or leave it’ attitude at the time of contract option renewal, forcing prices up,” the briefing stated.
A dispute with the contractor could also force the Royal Canadian Navy to resort to conducting maintenance and support for the ships on a piecemeal basis, a development that would affect its operations, added the briefing note.
The Liberal’s new defence policy puts more emphasis on relying on private contractors.
But the union chiefs point out in their letter to Trudeau that such reliance “can undermine financial transparency as industry books are not available to the Auditor General, the Parliamentary Budget Officer, Parliament nor the public through Access to Information requests.”
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