But wait, there's MORE!
Murray Brewster doesn't normally stoop to breathless reporting on a non-story, but in the interests of selling dead trees and ink, I guess standards get lowered:
So, what exactly is the "bombshell" from the story's headline? That tanks require maintenance over the course of a twenty-year lifespan? That said maintenance costs money?
Here's another "bombshell" for Brewster: no mention has been made of...
EVEN...
MORE...
COSTS!!!
Like the salaries of all those armoured troops required to operate and maintain the tanks over the course of the next TWENTY YEARS!
Like the cost of diesel to run them - for TWENTY YEARS!
Like the cost of all the rounds of ammunition they'll fire in both training and operations - for the next TWENTY YEARS!
And O'Connor made no mention whatsoever of the paint costs associated with twenty years of operations - do you know how many gallons it takes to cover a 70 ton tank?
Why hasn't the MND included the basing costs of operating Leo 2's? I mean, they need to be garaged somewhere, and those buildings undoubtedly have costs associated with them.
What about the salaries, travel costs, long-distance phone bills, printer toner cartridges and other sundry costs related to the project team, the minister's office, and the CF Public Affairs team? All of them contributed too, right?
*sigh*
I'll make you a bet I know why the MND didn't talk about the maintenance contract up front: because he knew uninformed bozos would try to blow it into a big story when it isn't. Looks like for once, he had it right.
Update: The more I think about this, the more ridiculous the story seems to me.
O'Connor wasn't hiding the maintenance contract, he wasn't saying it was included in the $650M purchase price. How do I know this? Well, unlike some, I actually read the backgrounder:
That competition hasn't happened yet - if I'm going to slag O'Connor for anything, it's for giving away how much DND expects to pay for the contract before bids are tendered. Not the brightest tactic if you're looking for a good deal, Minister.
Look, you can play with these numbers any way you want. Aircraft and ships tend to require more manufacturer maintenance, and so the maintenance contracts are built into the purchase price. Besides, a secondary effect of something like the C-17 announcement was to showcase how much the Conservatives were investing in the CF, and the bigger number made for better press.
In this case - for our new tanks - the maintenance contract could be unbundled, and so it was. And as an added benefit, DND got to say that the acquisition costs were coming directly out of the cancelled MGS project.
Which is entirely true, by the way. Why is it a "bombshell" when Gordon O'Connor announces an acquisition of Leopards without building in maintenance contracts, but not even newsworthy when John McCallum announces an acquisition of the Mobile Gun System with no maintenance costs attached?
Scandalous! I expect the headline over tomorrow's follow-up piece will read "Mobile Gun System project costs including twenty-year maintenance contract would also have been double the announced acquisition price." Unwieldy, that. How about "Former Liberal Defence Minister hid costs of MGS, full price would have been double to $1.3 billion?" Better, but I'll never be as good as the pros slaving away in the newsrooms, will I?
What's the real cost delta between the MGS and the Leo 2's? I'd make an educated guess that it's four-fifths of f*** all.
I guess we've gone full circle back to where I started: apples-to-apples comparisons don't sell newsprint.
Canada's purchase and long-term support of 100 slightly used Leopard 2A6 battle tanks will be $1.3 billion -- roughly double the Conservative government's initial public estimate last month.
As he detailed a list of military hardware the Conservative government plans to buy over the next few years, Defence Minister Gordon O'Connor surprised the Commons by announcing there will be a 20-year, $650-million service contract attached to the tank deal.
"The capital acquisition is $650 million and the support for 20 years is about $650 million; about the same range," he said last night in reply to an opposition question during debate over Defence Department estimates.
...
Mr. O'Connor announced on April 12 that the army was going to borrow 20 modern Leopard 2 tanks from Germany and buy 100 slightly used tanks of the same type from the Dutch to bolster Canada's fighting forces in Afghanistan.
But there was no mention at that time of a support contract, only the purchase of spare parts and cost of modifications.
So, what exactly is the "bombshell" from the story's headline? That tanks require maintenance over the course of a twenty-year lifespan? That said maintenance costs money?
Here's another "bombshell" for Brewster: no mention has been made of...
EVEN...
MORE...
COSTS!!!
Like the salaries of all those armoured troops required to operate and maintain the tanks over the course of the next TWENTY YEARS!
Like the cost of diesel to run them - for TWENTY YEARS!
Like the cost of all the rounds of ammunition they'll fire in both training and operations - for the next TWENTY YEARS!
And O'Connor made no mention whatsoever of the paint costs associated with twenty years of operations - do you know how many gallons it takes to cover a 70 ton tank?
Why hasn't the MND included the basing costs of operating Leo 2's? I mean, they need to be garaged somewhere, and those buildings undoubtedly have costs associated with them.
What about the salaries, travel costs, long-distance phone bills, printer toner cartridges and other sundry costs related to the project team, the minister's office, and the CF Public Affairs team? All of them contributed too, right?
*sigh*
I'll make you a bet I know why the MND didn't talk about the maintenance contract up front: because he knew uninformed bozos would try to blow it into a big story when it isn't. Looks like for once, he had it right.
Update: The more I think about this, the more ridiculous the story seems to me.
O'Connor wasn't hiding the maintenance contract, he wasn't saying it was included in the $650M purchase price. How do I know this? Well, unlike some, I actually read the backgrounder:
In the coming months, the Government of Canada will conduct one or more fair, open and competitive processes for the long-term in-service support of this fleet.
That competition hasn't happened yet - if I'm going to slag O'Connor for anything, it's for giving away how much DND expects to pay for the contract before bids are tendered. Not the brightest tactic if you're looking for a good deal, Minister.
Look, you can play with these numbers any way you want. Aircraft and ships tend to require more manufacturer maintenance, and so the maintenance contracts are built into the purchase price. Besides, a secondary effect of something like the C-17 announcement was to showcase how much the Conservatives were investing in the CF, and the bigger number made for better press.
In this case - for our new tanks - the maintenance contract could be unbundled, and so it was. And as an added benefit, DND got to say that the acquisition costs were coming directly out of the cancelled MGS project.
Which is entirely true, by the way. Why is it a "bombshell" when Gordon O'Connor announces an acquisition of Leopards without building in maintenance contracts, but not even newsworthy when John McCallum announces an acquisition of the Mobile Gun System with no maintenance costs attached?
Scandalous! I expect the headline over tomorrow's follow-up piece will read "Mobile Gun System project costs including twenty-year maintenance contract would also have been double the announced acquisition price." Unwieldy, that. How about "Former Liberal Defence Minister hid costs of MGS, full price would have been double to $1.3 billion?" Better, but I'll never be as good as the pros slaving away in the newsrooms, will I?
What's the real cost delta between the MGS and the Leo 2's? I'd make an educated guess that it's four-fifths of f*** all.
I guess we've gone full circle back to where I started: apples-to-apples comparisons don't sell newsprint.
posted by Babbling Brooks at 9:14 a.m.
9 Comments:
ya want a real shock . . I bought a new car and only found out later that gas, insurance, parts, repairs and accessories were NOT included in the price.
Nowhere in the contract did the vendor tell me I had to pay for all this. Everyone knows this is always included in the price of the car.
The media should be informed of this terrible crime.
See, Fred, even you're engaging in a scandalous cover-up: you haven't included interest costs on your financing, car washes, tire replacement, wiper fluid, or air freshener costs.
"Bombshell" time!
damn . . you are right . . . I also forgot the really big costs like dashboard bobble head dolls and rear view mirror fuzzy dice.
:)
Well then, you should be hanged from the flagpole at the nearest newspaper office for your transgressions.
Oh wait - newspapers don't fly flags, do they?
I think DND should know is has to be extremely careful about the announcement of military purchases, because you had to see this coming...
From the minute the Conservatives bought the first pencil holder as part of the decision to start rebuilding the Canadian military, you knew that there would be a lot of hoo-ha in the media about the costs (which are unbelievably high) of up-to-date equipment. But maybe considering the tortured route these purchases take through the bureaucracy, this just isn't possible...
Great deal actually, considering the cost of the Gun Registry.
By the way, are these tanks registered.
I suspect the Liberals won't mention the current cost of operating the Leo C2's which will be where a fair bit of the money will come from.
Not to mention we are buying very good tanks for far less than the MGS deal.
I suspect the Liberals won't mention the current cost of operating the Leo C2's which will be where a fair bit of the money will come from.
Actually, the C2's were scheduled for demolition, so there weren't any long-term maintenance costs associated with that fleet.
Not to mention we are buying very good tanks for far less than the MGS deal.
I agree that they're good tanks, but the purchase price in comparison with the MGS is just about identical. In fact, that's precisely where the money for this acquisition is coming from: the cancelled MGS project.
The real point here is that the difference in long-term costs between the Leo 2's and the MGS that we were going to be using before the switch back to tanks is going to be negligible.
If there was a huge cost difference between the MGS and Leo 2's over their respective projected lifetimes, I'd be able to find some merit in the story. But that's not what Brewster's writing about.
Speaking of long-term operating costs, folks might want to read this interesting article at Strategy Page called "Murphy's Law: When Being Common Is An Advantage".
http://www.strategypage.com/htmw/
htmurph/articles/20070519.aspx
It's about US Army computerized vehicle simulators for training the troops. This seems to be the present and future for all modern militaries, as it saves a fortune in training and non-combat operating costs of new, incredibly expensive vehicles of all types.
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