Benefits of shipbuilding contract touted
Nova Scotia Premier Darrell Dexter is headed to Ottawa next week to try to persuade federal cabinet ministers that Halifax-based Irving Shipbuilding Inc. should be awarded a $25-billion shipbuilding contract — a project he describes as the province's biggest industrial opportunity since Confederation.
"Winning this bid would equate to hosting the Olympics each year for 30 years," Dexter told a business audience Friday.
"It would be a win for Nova Scotia and a win for Canada."
Three other shipyards are competing for the business — Vancouver Shipyards, Seaway Marine and Industrial of St. Catharines, Ont. and Quebec's Davie Yards in Levis. The deadline for bids is July 7, and a final decision is expected in September.
Deciding which yard will get the biggest contracts will be a tough choice for federal cabinet ministers keen to ensure their regions get a share of the spoils, which be rolled out over 30 years.
Dexter said it helps to have Defence Minister Peter MacKay, a Nova Scotia MP, in the province's corner.
"Every time I've spoken with him about it, he makes it clear he intends to be a strong advocate and voice for Irving Shipyards at the federal table," the premier said. "Like all big contracts, the ultimate accountability lies with the [federal] government and the cabinet."
A spokesman for Dexter called late Friday to clarify Dexter's comments about MacKay's purported advocacy of the Irving bid. He later emailed a statement from the premier that stated the province agrees with "the federal government's commitment to a fair tendering process."
"Today my intent was to credit minister MacKay and all federal ministers for that commitment," Dexter said in the email.
"Each bid must be assessed on its merits."
N.S. is 'strong contender': expert
Following the carefully choreographed release of two glowing economic studies, Dexter delivered a hometown economic pitch that was infused with a strong political message.
Dexter said the Halifax Shipyard should be awarded the $25-billion contract to build about 20 large combat vessels because it would be good for Canada as a whole.
"If Nova Scotia is selected, the Canadian economy is expected to grow by $1.5 billion, and 4,500 jobs will be created outside of Nova Scotia … on top of the jobs created here," he told the crowd.
"No other yard can make a case this compelling, with as much impact spread across the country."
Earlier in the day, the Halifax Business Partnership released a study from Jupia Consultants that said awarding the contract to Ontario would result in very little economic spinoffs outside that province. Awarding the contract to a Quebec or British Columbia shipyard would result in benefits for Ontario but not Atlantic Canada, the study said.
Paul Kent, CEO of the partnership, said for every $1,000 spent in Nova Scotia, another $491 would be generated in other regions of the country.
Louise Mercier-Johnson, an expert on the National Shipbuilding Procurement Strategy, said Nova Scotia is making a strong bid.
"Nova Scotia certainly has a history and a legacy of providing world-class warships to the Canadian navy," said Mercier-Johnson, vice-president of Maritime Affairs with the Navy League of Canada.
"Compared to its contenders, Nova Scotia can more than support a program of this capacity. It is clearly a strong contender in this race."
Work to be spread across Canada: Irving
The owner of the Halifax Shipyard, J.D. Irving, said he was on the same page as the premier, who plans to meet with at least three federal cabinet ministers on Monday.
"This would be a big win, not just for Nova Scotia and the Maritimes, it's going to go across Canada," Irving said after the premier's presentation.
"There's a perception that all of the work will be here in Nova Scotia, and that's not the case. There's going to be combat system and electronics and machinery coming from across the country."
When the Irving shipyards built Canada's 12 Halifax-class patrol frigates in the 1980s and 1990s, the work was spread across Canada, he said.
As well, Irving's company has spent $90 million over the past five years upgrading the Halifax Shipyard.
"We've got the workforce, we've got the management, we've got the skill and we're ready to go," he said.
If Irving fails to win the big contract, his company could be in line to build non-combat vessels — including two, large supply ships — through a contract worth about $5 billion. But Irving said building the supply vessels would be difficult for his operation. He did not elaborate.
If the company wins the competition for the biggest contract, the project would create about 11,500 additional jobs in Nova Scotia during the peak of construction in 2020, according to a study by the Conference Board of Canada.
As well, the province's GDP that year would grow by $897 million, the think-tank concluded, adding that other provinces would benefit from a $1.5 billion injection that same year.
The Jupia study said average personal income in Nova Scotia would jump by $447 annually, helping residents buy an additional 750 new cars every year, and 420 houses.