Vice-Admiral Norman/NSS Timeline 2020-2022

I last updated my Vice-Admiral Mark Norman/National Shipbuilding Strategy (NSS) timeline back in 2019, but developments these past two weeks have motivated me to revisit it.

Vice Adm. Mark Norman (U.S. Navy Photo by Chief Mass Communication Specialist Julianne F. Metzger/Released)

Norman, you will recall, was the Canadian naval officer charged with one count of breach of trust for:

…leaking cabinet secrets in relation to a $668-million shipbuilding deal to lease a supply vessel. He was accused of leaking to both an executive at the Davie Shipyard in Levis, Que., which leased a supply ship to the navy, and to a CBC journalist.

When I left off in 2019, the Crown had dropped the charge against Norman who, according to former Justice and Defence Minister Peter MacKay, “not only had the blessing of the former Conservative cabinet” to deal with Davie but was “authorized to speak with it directly in the run-up to the signing of a $668-million leasing contract.”

“Mark Norman was acting within his authority and with cabinet authority,” MacKay told CBC news.

Norman received a settlement from the federal government, details of which were not revealed, and retired from the navy.

As for the NSS itself, a report issued by Auditor General Karen Hogan in 2021—focusing on large vessels and covering the period from 1 January 2018 to 31 January 2020—found that, overall:

…the National Shipbuilding Strategy was slow to deliver the combat and non-combat ships that Canada needs to meet its domestic and international obligations. The delivery of many ships was significantly delayed, and further delays could result in several vessels being retired before new vessels are operational.

By the end of this period, just 2 of 4 vessels were due to be delivered by January 2020 had been completed, and both were delivered late.

So, what’s happened since?

 

Misconduct

Well, let’s see, in July 2020 General Jonathan Vance, the man who had suspended Norman, announced his intention to retire as chief of the defence staff and in December 2020, Prime Minister Justin Trudeau appointed Vice-Admiral Art McDonald to replace him. McDonald took up his duties in January 2021.

And then things got weird.

Shortly after he retired, it was revealed that Vance was the subject of a military investigation for alleged sexual misconduct, an investigation that ended without charges because, as a military spokesperson told Global News, it was “legally impossible” under the current roles to try someone of Vance’s rank in the military system.

The military police did charge Vance with one count of obstruction of justice, to which he pled guilty and for which he received a suspended sentence, 80 hours of community service and a year’s probation.

Jonathan Vance

Jonathan Vance

But the weirdness didn’t end there: Vance’s successor as chief of the defence staff, Admiral Art McDonald, stepped aside in February 2021, facing his own charges of sexual misconduct. These would result in his being replaced as chief of the defence staff by General Wayne Eyre and I’m sorry, but how did I not register that Canada now has a chief of the defence staff named WAYNE EYRE? Think of the “Mr. Rochester” and “wife-in-the-attic” jokes I could have been making.

The most recent development in the Norman case, the one that sparked this update, involves ACOA employee Mark Matchett, who was charged with one count of breach of trust in connection to the cabinet leak. Matchett was accused of passing cabinet documents — a memo and a slide deck presentation — to an Ottawa lobbyist working for the Davie shipyard in 2015.

On June 9, the Crown dropped the charge against Matchett after its case, according to the Canadian Press, basically “fell apart” with its own first witness.

That both cases—that against Norman and that against Matchett—collapsed so entirely has raised questions about the way the investigations were handled by the RCMP.

But that, dear readers, is a whole other can of worms.

 

Boom-and-bust

Karen Hogan

Karen Hogan

The thing about Canada’s National Shipbuilding Strategy is that the ships are almost incidental. Horgan notes in her report that the strategy’s objectives are to:

  • renew the federal fleet in a timely and affordable manner
  • create and support a sustainable marine sector in Canada
  • generate economic benefits for Canada

And that first objective is rendered basically impossible by the second and third. If Canada had really wanted to replace its fleet in a “timely and affordable manner,” it would have ordered the vessels from countries with thriving shipbuilding sectors.

Instead, we opted to use two shipyards that needed millions of dollars in upgrades to handle the work. Moreover, because we have no real domestic shipbuilding industry outside the NSS, when there were delays, which Horgan said have been particularly acute in getting the initial design work done and the first vessel in a given class into the water, there was no other work to keep employees busy they often would be laid off. In other words, the NSS was subject to the very “boom-and bust cycles” Horgan said it was designed to address.

I don’t actually have a problem with government spending to create jobs and drive the economy, but looking back over this whole messy NSS timeline, I have to wonder what it would have looked like if the feds had adopted the same insouciant attitude toward spending on housing that it has on ships?

 

Big Spender

Take the 15 Canadian Surface Combat Vessels to be built by Irving, for example. Their budget has ballooned from an initial $25 billion to almost $80 billion—and we found out this past week that Irving wants another $300 million in public funding to “modernize” its facilities to handle the work.

Compare that to the National Housing Strategy. Yes, the overall budget is similar—Canada will spend $70 billion over the next 10 years on housing—but to date, the bulk of the money has taken the form of low-interest loans. This is great news for private developers, who must promise to meet a pretty slack definition of affordable (80% of average local rents) for a certain number of units for a set period of time to access cheap cash. It hasn’t worked out so well for non-profits.

Imagine if the government were willing to simply build public housing, or provide adequate grants to non-profits to build public housing? Canada has a thriving construction sector, we wouldn’t have to invest in building the capacity of companies and the work would flow to more than two—three at best—firms. The economic benefits would be equally widespread.

I’d argue ensuring people had safe, adequate, affordable housing could even be viewed as a form of defence if you define defence as protecting the lives of Canadians.

But my real argument is this: if you’re going to operate a multi-billion-dollar-make-work project (which is basically what the NSS is), why not focus it on something of value to citizens, instead of on a handful of warships? (I am less fussed about the Coast Guard vessels, I can see the point of them, it’s the frigates I question.)

And on that, rather pointless, I realize, note, here’s my updated timeline:

 

2020

6 January 2020: The CBC reports that escalating costs at the Seaspan Shipyard in 2019 “depleted the multi-million dollar contingency fund set aside as part of the budget to build three offshore fisheries science vessels.”

27 January 2020: Information tabled in the House of Commons reveals the attempted prosecution of Norman cost the government $1,425,389.68.

29 June 2020: The federal government awards a $72.6 million contract to Fleetway Inc, of Halifax, to provide ” a full range of technical data management and systems engineering support services for the RCN’s fleet of Halifax-class ships.” The contract is for six years with an option to extend for “up to 22 years.”

Chantier Davie, Levis, Quebec

Chantier Davie, Levis, Quebec

September 2020: Irving chooses Lockheed Martin’s AN/SPY-7 radar systems for Canada’s new navy frigates but makes no public announcement about the deal.

9 October 2020: The federal government marks the delivery of the CCGS John Cabot, the third of three Offshore Fisheries Science Vessels built by the Seaspan Shipyards. The cost of the three ships is now placed at $788 million.

November 2020: The US announces that Canada will spend $650 million on 100 Standard Missile 2 Block IIIC missiles and 100 MK 13 Vertical Launch Systems for the Canadian Surface Combatants. Raytheon Missiles and Defense of Tucson, Ariz., will build the weapons.

December 2020: Lockheed Martin announces Canada’s new navy frigates will be equipped with its AN/SPY-7 radar systems. The CBC notes the choice is controversial because the system is “easy to upgrade to a ballistic missile defence system—a defence program successive Canadian governments have resisted joining.” Canada’s Department of National Defence insists the cost of adapting the radar to Canada’s frigate design “will be covered as part of the ($140 million) long-lead contract,” but a defence expert warns the system “has not be marinized” or “deployed on a ship” previously.

19 December 2020: The CBC obtains “an unsolicited defence industry slide deck presentation” that questions the choice of radar, main gun and close air defence systems for the navy’s new frigates.

20 December 2020: BC’s Zodiac Hurricane Technologies is awarded a $16.5 million contract to repair and overhaul some of the Navy’s stock of inflatable rubber boats.

23 December 2020: Admiral Art McDonald is named chief of the defence staff by the Liberal government.

 

2021

14 January 2021: Admiral Art McDonald takes over as chief of the defence staff.

3 February 2021: Global News reports that former chief of the defence staff General Jonathan Vance (the man who suspended Norman in 2017) faces allegations of misconduct involving Maj. Kellie Brennan and another unidentified woman.

Jonathan Vance

Jonathan Vance

3 February 2021: Norman presents the inaugural Vice-Admiral Mark Norman Leadership Award to Master Sailor Rachel McCarthy. The award was created by the Royal Canadian Navy Benevolent Fund and includes a prize of $5,000.

18 February 2021: The federal government officially awards Seaspan a $453.8 million contract to “transition the offshore oceanographic science vessel (OOSV) project from the design phase to full construction.” The Canadian Press reports that the total cost of the new vessel has ballooned to $966 million from the original estimate of $108 million.

24 February 2021: Parliamentary Budget Officer Yves Giroux estimates the cost to build 15 Canadian Surface Combatants (to replace the RCN’s Halifax-class frigates and Iroquois-class destroyers) at $77.3 billion. The ships are to be built at the Irving Shipyards in Halifax. When Irving was awarded the contract to produce the 15 CSCs and six Arctic Patrol Vessels in 2011, the value of the entire package was estimated at $25 billion over 25-30 years.

24 February 2021: Admiral Art McDonald steps aside as chief of defence after coming under a military police investigation for what is eventually revealed to be sexual misconduct. Navy Lt. Heather Macdonald, a navy combat systems engineer, will later identify herself as the complainant. Lieutenant-General Wayne Eyre is named Acting Chief of Defence Staff.

6 May 2021: The government announces it would move forward with the construction of two new polar icebreakers for the Canadian Coast Guard, doubling the initial plan, announced in 2011, to build one at the Seaspan Shipyards in Vancouver at an estimated cost of $1.3 billion. The second vessel is to be built by Davie Shipbuilding of Lévis, Quebec “pending the successful completion of the ongoing selection process as the third strategic partner for large ships construction under the NSS.” No price tag is attached to the announcement.

11 May 2021: The US State Department reveals that the Canadian government has asked the US to provide the AEGIS Combat System, SPY-7 radars and related equipment at a cost of $2.2 billion for its Canadian Surface Combatant fleet. The prime contractor will be Lockheed Martin Rotary and Mission Systems of Moorestown, NJ.

19 May 2021: The CBC reports that, 18 months after delivery to Dartmouth, the CCGS Jacques Cartier, the second of three offshore fisheries science vessels built by Seaspan, has yet to complete sea trials or begin the training missions necessary before it becomes operational. The broadcaster says that “equipment failures, delays receiving parts, and COVID-19-related travel restrictions in Nova Scotia combined to upend the timetable.”

14 July 2021: The federal government receives the Davie Shipyards’ “supporting materials” to become the third shipyard under the NSS.

15 July 2021: The Canadian Forces National Investigation Service (CFNIS) announces a single charge of obstruction of justice against former chief of defence staff Jonathan Vance, related to an ongoing military investigation into allegations of sexual misconduct.

CCGS Jacques Cartier

CCGS Jacques Cartier at Ogden Point in Victoria, BC, December 2019 (Photo by 7and, CC BY-SA 4.0 https://creativecommons.org/licenses/by-sa/4.0, via Wikimedia Commons)

22 July 2021: As part of the NSS, Public Services and Procurement Canada (PSPC) signs a $35 million contract with BC’s Zodiac Hurricane Technologies for 30 multirole boats (MRBs) to be launched and operated from the Navy’s Halifax-class warships.

3 August 2021: Canadian Forces Provost Marshal Brig.-Gen. Simon Trudeau announces the Canadian Forces National Investigation Service had completed its investigation into Admiral Art McDonald. Trudeau says the investigation “did not reveal evidence to support the laying of charges under either the Code of Service Discipline or the Criminal Code of Canada.”

11 August 2021: Admiral Art McDonald’s lawyers announce the officer will return to his duties and functions as defence chief “immediately.” In response, the Privy Council Office announces McDonald will be put on leave until the matter was reviewed.

13 August 2021: Wayne Eyre is promoted from Lieutenant-General to General.

15 September 2021: The military police reveal that their investigation into whether retired General Jonathan Vance broke code of service rules through an allegedly inappropriate relationship, had ended on August 6 without charges. Global News reports that when pressed for an explanation:

…a military police spokesperson pointed to a recent report from former Supreme Court justice Morris Fish, which warned it was “legally impossible” under the current rules to try someone of Vance’s rank in the military system.

18 September 2021: Norman endorses Conservative Leader Erin O’Toole ahead of federal election.

14 October 2021: Admiral Art McDonald tells CTV he has been “exonerated” and wants his job back. He sends a letter to top Canadian military officers reiterating this claim and arguing for his return to his post.

18 October 2021: The Canadian Forces National Investigation Service (CFNIS), which conducted the investigation into Admiral Art McDonald, releases a statement saying:

The CFNIS investigation into an allegation of sexual misconduct against Admiral McDonald resulted in no charges being laid based on insufficient evidence. This does not mean that the allegation was unfounded.

19 October 2021: Vancouver’s Seaspan Shipyards issues a press release celebrating “10th anniversary of building ships in Canada” as part of the NSS. In that decade, it has completed three Offshore Fisheries Science Vessels (OFSVs) and notes that “[s]everal other vessels are under construction and in design.”

5 November 2021: The CCGS Hudson, an oceanographic and hydrographic survey vessel, suffers a starboard propulsion motor failure and is towed to St. John’s.

CCGS Hudson

CCGS Hudson, photo by Mac Mackay, Shipfax

25 November 2021: General Wayne Eyre is named chief of defence staff.

1 December 2021: Admiral Art McDonald announces he will leave the military

16 December 2021: Parliamentary Budget Officer Yves Giroux estimates the cost of building the two polar icebreakers announced in May at $6.1 billion. Giroux says dividing the work between two shipyards will add as much as $800 million to the cost and warns that delays could push the budget as high as $7.7 billion.

 

2022

20 January 2022: The CBC reports the Canadian Coast Guard will decommission the 59-year-old science vessel the CCGS Hudson which has been tied up in St. John’s since a “catastrophic mechanical failure” in November 2021. The Coast Guard also reveals that delivery of the Hudson‘s replacement from Seaspan Shipyards has been pushed to 2025.

1 February 2022: The Australian reports on a leaked Department of Defence Engineering Team Assessment of the navy’s nine future Hunter-class frigates, based on the same BAE Systems Type-26 frigate chosen by the Canadian Navy. The report, undertaken in November 2021, finds that the frigates are “slower and heavier than planned and facing numerous design faults and problems with shipbuilder BAE Systems Maritime Australia.”

28 February 2022: Former Mayor of Sydney (and leader of the NS Liberals) Vince MacLean proposed the CCGS Hudson be brought to Sydney and repurposed as a museum and training vessel for cadets at the Coast Guard College.

28 March 2022: The Canadian Coast Guard is “monitoring” problems affecting all three of its new offshore fisheries science vessels, according to the CBC:

Two different components — a propulsion shaft tube and valves controlling seawater intake — have needed repair or replacement on coast guard ships John Franklin, Jacques Cartier and John Cabot.

The “class-wide” problems included corrosion, premature wear or mislabelling.

The vessels came with a one-year warranty and only the CCGS John Cabot was still covered when Seaspan repaired its stern tube bearings in January 2022. The same repairs on the CCGS Sir John Franklin cost  $410,978.53 in the fall of 2021.

30 March 2022: Former chief of the defence staff Jonathan Vance pleads guilty to a single charge of obstruction of justice and is sentenced to a conditional discharge and 12 months’ probation.

1 June 2022: Irving Shipbuilding President Kevin Mooney says his shipyard needs several upgrades not originally anticipated when it was selected to build 15 new Canadian warships. Mooney acknowledges the overall costs of the project are under review as a result of inflation and supply chain issues.

Kevin Mooney

Kevin Mooney

9 June 2022: The Crown dropped is case against former Atlantic Canada Opportunities Agency (ACOA) employee Matthew Matchett. Per the Canadian Press:

…the prosecution’s case against Matchett fell apart with its first witness.

Longtime lobbyist Brian Mersereau had testified that he received a package of documents after speaking with Matchett in November 2015 about the Liberals’ plan to review the contract with Davie.

But the chairman of Hill+Knowlton Strategies repeatedly told the court that he could not remember Matchett providing him with a secret memo to cabinet about the deal.

That failure to conclusively link Matchett to the secret memo proved lethal to the Crown’s case.

9 June 2022: The CBC reports that the Canadian Coast Guard is looking to charter a research ship for up to five years while it waits for its new $1 billion offshore oceanographic science vessel to be completed by Seaspan.

Ottawa has issued a request for information to industry to charter an “interim science vessel” on the East Coast for 2023 to 2026, with an option for two more years.

8 June 2022: The feds begin negotiations with Chantier Davie [the government seems to have switched from the English to the French name for the Davie Shipyards so I will follow suit] “towards an umbrella agreement” that will see the shipyard “become the third strategic shipbuilding partner under the NSS.”

Pending successful negotiation of an umbrella agreement, Chantier Davie will build 1 of 2 polar icebreakers and 6 program icebreakers for the Canadian Coast Guard.

13 June 2022: Irving Shipbuilding requests “at least” another $300 million from the Canadian government to modernize its shipbuilding facilities although, as David Pugliese points out in the National Post, one of the requirements for winning the bid to participate in the NSS was that “the yard had the capability to build the vessels and the taxpayers wouldn’t need to contribute funding to outfit facilities for the task.”

There is a nice symmetry to this, of course, in that Irving received roughly $300 million from the province to build its shipyard in the first place:

March 2012: Nova Scotia’s NDP government under Darrell Dexter extends a $260 million forgivable loan and a $44 million repayable loan to Irving Shipyards in return for a promise to create 4,000 jobs. (Are the people of Nova Scotia not people of Canada? Did Irving not hear what Prime Minister Harper said about this not costing us anything?) The shipyard is also offered a $200 million loan guarantee which does not become public until 2016 at which point, the Liberals, under Stephen McNeil, say they will not honor it.

Irving’s website says it has a team of “2,100” not 4,000 “shipbuilders.”