Ahh, ok. Thanks for the clarification. Essentially any new builds will have to get bid on and be subject to the NSS requirements. Does that preclude, say Seaspan, from subbing out work (modules etc) to Heddle (or anywhere else, for that matter)?
Caveat up front, all of this is open source that has been in news releases etc before, so just left out some of the bits that is commercial in confidence, like the actual dollar values of the upgrades.
It depends; the actual work packages had a value assigned to them, and because the companies didn't trust the GoC (rightly) not to cut the work, there are guarantees built in if they do cut the work that there is basically a payout based on the value of the shipyard upgrades they did to meet the NSS requirements. Because that was intended to come out of profits (and not funded by a forgivable provincial loan) the idea was that they don't spend several hundred million doing upgrades and then get left hanging in the wind.
Because Asterix wasn't under NSS, for that one Davie didn't have any of the 100% build in Canada, value proposition or other contract terms so it was much easier for them to offshore the superstructure. They can't do that under the NSS terms without providing a bunch of offsets, and it just doesn't really make sense with how easy it is to get the value just in having people working in Canada.
So it's basically a provision that the NSS yards get made whole with some additional cancellation penalties if the GoC does a flip flop, so same idea I guess as the EH101 and other big contracts.
Once they have the work in contract though, there isn't anything stopping them from partnering with other companies, with a fairly standard contractual setup for how that would work, but basically the main yard is always the prime contractor, and responsible to flow down the various contractual requirements (including the made in Canada reporting requirements, QC, IP etc) to the partners or primes. The original bids included some strategic partners that have changed over time, so all that is pretty normal for long term contracts.
The 1000 tonne exclusion was part of the NSS framework to make sure the smaller yards (Groupe Ocean, Heddle etc) didn't get cut out of other work, especially when you are talking about smaller ships where the smaller yards are more efficient at building as they have much less overhead. So part of joining the NSS includes the NSS yards agreeing that they are excluded from bidding on the work.
The non combat package in the bid included the two CCG classes of research boats, the JSS and the Polar class (which is frankly a crazy setup for short run ships and one offs, even for an experienced yard), so if any of those projects had been reduced or cut Canada agreed to either replace it with an equivalent value project or pay off some pro-rated portion for the upgrade costs.
I don't think there is anything though that would stop Canada from having an open competition though for an MCDV replacement project, and if it's over 1000 tonnes I think it would be fair game for the NSS yards as well, especially if they partnered with someone. The big thing there is whether the shipping costs would make sense to geographically separate the modules too much, but could be doing things like partnering on the design side/experience with GoC contracting or something.
No idea how that will roll out, as there will be a huge amount of politics involved. Based on the age of the MCDVs though, I hope they go outside of the NSS to the other yards so we don't wait 10+ years before they cut steel, but I think project staff from DND, PSPC and ISED will likely be the limiting factor anyway.
The NSS overhead is crazy though, and because there is so much reporting and government interface, probably adds hundreds of millions over the strategy life.
vardmarine.com
