F-35 fighter jet cost questions date back to 2010
Government rebuffed several requests for full costs, now set to reveal results of external review
By Laura Payton, CBC News
Posted: Apr 12, 2012 5:32 AM ET
Last Updated: Dec 12, 2012 12:19 PM ET
The question of whether Canada should buy 65 F-35 Joint Strike Fighters from Lockheed Martin has been debated since the purchase was first announced in 2010.
The issue even led to the 2011 federal election, when opposition MPs voted non-confidence in the government after requests for details on the cost of the F-35s and the Conservatives' crime legislation went unanswered.
Defence Minister Peter MacKay, Public Works Minister Rona Ambrose and then-industry minister Tony Clement announced on July 16, 2010, that Canada would buy the fighter jets to replace its CF-18s.
The Liberals had initiated a memorandum of understanding with Lockheed Martin and a number of allied countries to develop the jets, but Canada has not signed a contract for the purchase.
Since July 2010, the question of whether the $9-billion cost is accurate has been as widely debated as the question of whether there should have been an open competition.
On April 3, Auditor General Michael Ferguson reported the government’s internal cost estimates from 2010 were almost $10 billion higher than the $16 billion they'd said publicly. The government says they weren't including fuel or pilot salaries in their estimate, arguing that's normal.
As it turns out, the government had a number of occasions to provide a tally of the full costs — besides the repeated questions in the House of Commons, committee appearances and interviews.
Since July 2010, Liberal MPs have tabled at least 20 order paper questions in the House. An order paper question allows for more detailed queries and responses than the oral fireworks in question period. But none yielded the information the auditor general dug up.
July 16, 2010: MacKay, Ambrose and Clement announce the government will buy 65 F-35 fighter jets.
Asked about maintenance and support costs, Ambrose was coy.
"Of course we have some estimates, but the actual aircraft is not in production yet. When the aircraft comes off the production line, we expect to negotiate the in-service support costs," she said.
Oct. 6, 2010: House finance committee request
The House finance committee, working from a motion by Liberal MP Scott Brison, requested that the Department of Finance give it "the estimated cost of the F-35 aircraft per airplane, how this fits into the fiscal framework, and that this material be submitted to the committee within 10 days."
The response cited National Defence estimates and said the per-plane cost was "in the low- to mid- $70 million US over the timeframe Canada is planning on purchasing aircraft. This is the unit cost per aircraft and does not include related costs such as spare parts, weapons, training or infrastructure."
The answer also said the F-35 project wouldn't need "new or unplanned sources of funds" because money had already been earmarked in previous budgets.
Nov. 17, 2010: Another House finance committee request
The House finance committee followed up its first request by asking for "all documents that outline acquisition costs, lifecycle costs, and operational requirements associated with the F-35 program and prior programs (CF-18)."
National Defence responded by saying it would take 10 weeks of work by the entire F-35 program management team. "As such, a complete response to the request cannot be provided within the required seven calendar days," as per the request.
Feb. 7, 2011: A question of privilege
Brison rose in the House on a question of privilege, complaining that the government was infringing on his privilege as a member of Parliament by refusing to hand over the information MPs had requested. Then-speaker Peter Milliken listened to arguments but wouldn't rule for another month.
Feb. 17, 2011: Government turns over more documents
The government tables more documents, but not enough to satisfy opposition MPs.
Feb. 28, 2011: House votes to force production
MPs voted on a motion ordering the government to produce the documents ordered by the finance committee. The motion passed, giving the government a March 7 deadline.
March 9, 2011: The Speaker rules
Milliken ruled that, in his view, the documents provided by the government on Feb. 17, 2011, weren’t enough to satisfy the request by MPs on the finance committee. He said he found the government's lack of response to be "unsettling," but also pointed to a greater concern of "the absence of an explanation for the omissions." He had ruled the year before that the powers of the House to request documents is "broad" and "absolute."
March 17, 2011: Parliamentary budget officer reports on F-35 costs
Parliamentary Budget Officer Kevin Page estimated it would cost $29.3 billion to buy the planes and keep them flying for 30 years (the government's estimate was based on 20 years and, MacKay said on April 10, 2012, does not include the cost of fuel or pilot salaries).
Also on March 17, the government provided documents requested by the Finance committee on the cost of its crime legislation and corporate tax cuts, but only in English, so they couldn't be distributed to MPs, according to the rules of the House. The documents were requested in the same motion that requested the F-35 records.
MacKay called Page's findings "flawed."
March 21, 2011: Contempt of Parliament
A report by the procedure and House affairs committee, with Conservative MPs disagreeing, said "the government's failure to produce documents constitutes a contempt of Parliament."
March 25, 2011: The House falls
The Liberals put a motion of non-confidence based on that report in front of the House and the government falls, triggering the May 2, 2011, federal election.
June 23, 2011: The finance committee picks up where it left off
The Finance committee returns to its request, asking for the documents tabled March 17 to be translated into French. The documents are tabled March 16, 2012.
April 3, 2012: The auditor general reports
Auditor General Michael Ferguson says National Defence likely underestimated the full cost of the F-35 and didn't give complete information to Parliament. Ferguson says the department's own estimate puts personnel, operating and maintenance costs at $16 billion, for a total 20-year cost of $25 billion for the F-35s.
In response, the government froze the $9-billion envelope set aside for the purchase and announced that a new secretariat outside the defence department would be formed to oversee the procurement going forward. The initial press release calls it the "F-35 secretariat," but in early May Public Works Minister Rona Ambrose confirms its name was changed to the "national fighter procurement secretariat."
April 26, 2012: Auditor general testifies at public accounts committee
Auditor General Michael Ferguson tells MPs on the public accounts committee significant items were missing from the Canadian government's cost estimates for F-35 fighter jets. In an interview two days later for CBC Radio's The House, Parliamentary Budget Officer Kevin Page says it appears the Conservative government kept two sets of books when it came to the costs of replacing Canada's aging CF-18s.
On May 1, deputy ministers from the departments of defence, industry, public works and the Treasury Board testified together at the public accounts committee, denying there were different cost figures provided to the public than their own internal estimates showed.
By the end of May, the committee bogs down over witness lists, with the Conservatives arguing they've heard enough after multiple appearances by Ferguson and departmental officials, while Liberal and NDP MPs have other ideas about who they want to call as witnesses.
June 2012: National Fighter Procurement Secretariat begins work
The group headed by former auditor general Denis Desautels at the public works department begins its work implementing the Harper government's "seven-point action plan" to "evaluate options" for replacement fighter jets, which may still include the F-35. Canada does not pull out of its commitment to the international research and development program for the F-35, which includes some benefits for Canadian industry.
Sept. 7, 2012: KPMG awarded audit contract
After a series of delays over the summer, a contract worth more than $600,000 is awarded to KPMG to review the costs of the fighter jet procurement. By early December, KPMG's report is said to be complete and opposition MPs question why the Harper government is delaying its release.
Another tender is issued in late October for a firm to study how things worked inside the military's procurement process up to last June, when the Harper government put the brakes on the original purchase and put in place its seven-point plan. That contract, expected to be awarded before the end of 2012, will measure whether problems identified with the process have been addressed.
Nov. 21, 2012: Public accounts committee reports back
In a 29-page report, the Conservative majority on the public accounts committee offers six recommendations to deal with issues surrounding the cost of the project raised by auditor general Michael Ferguson. Opposition MPs write a dissenting report, accusing the Conservatives of a whitewash after MPs heard only seven hours of testimony and no responsible ministers appeared.
Nov. 30, 2012: Lawson acknowledges other options
Canada's new chief of the defence staff, Gen. Tom Lawson, tells MPs on the defence committee that jets other than the F-35 do offer at least some of the stealth capabilities the military needs. His statements raise eyebrows because they appear to contract statements by Defence Minister Peter MacKay earlier in the process that stated only the F-35 meets the military's requirements.
Earlier in November, Ambrose told the House of Commons that the secretariat's work would not be constrained by the previous statement of requirements for the fighter jet replacements, which have been set aside. In Oct., the defence department issued a statement saying the new head of the air force, Lt.-Gen. Yvan Blondin, misspoke when he suggested to The Canadian Press that the Harper government had not asked the military to look at options other than the F-35.
The Harper government vigorously denies media reports that the F-35 program was dead, but all official statements point to the Harper government taking seriously its commitment to follow through with a full consideration of all its options for replacing the CF-18, which may include the purchase of fewer than 65 F-35s and/or replacing at least some of the fleet with other kinds of planes.
Corrections and Clarifications
- This story has been edited from an earlier version to correct information on the Feb. 17, 2011, tabling of documents. The tabling included only documents requested by the finance committee on the cost of prisons and corporate tax cuts, not the F-35. April 12, 2012
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