Problems with C-130J maintenance contract
The government can't figure out how to divvy up the pork:
The federal government doesn't yet have a long-term maintenance contract for its new air force transport planes because it's balking at the high costs and arguing about benefits to Canadian industry.Jerc photo (though whether any of ours will ever get to Afstan...):
The air force is due to take possession of the first of its new C-130J Hercules aircraft, but without a maintenance deal...
A $1.4-billion contract for 17 new transports was signed with Lockheed Martin in January 2008.
But unlike past big-ticket purchases, it did not come with a long-term, in-service support contract, something the Defence Department initially pegged at $1.7 billion.
The matter was left to negotiation with Lockheed Martin.
Defence sources say the price tag for the 20-year maintenance agreement and haggling over regional benefits for Canadian companies have bogged down the talks.
Public Works and Government Services Canada, which is responsible for negotiating the arrangement, did not comment.
National Defence is scrambling to assemble a temporary service arrangement to avoid the potential embarrassment of having to park brand new aircraft on the tarmac for lack of maintenance people and resources...
...the first C-130J Hercules is expected to arrive about six months ahead of schedule [first one now being assembled]...
...over the last year the government quietly dropped its direct benefit demand and replaced it with a requirement for indirect industrial benefits up to 75 per cent of the contract value.
Instead of spending money on the C-130J in Canada, Lockheed Martin will be required to buy equivalent defence contracts and services elsewhere in the country.
Canadian defence contractors are apparently upset about the proposal, although they are not entirely frozen out of the equation.
The landing gear for the hardy transport plane, which is expected to land on dirt and gravel airstrips world-wide, and some electronic components are made by Ontario and Quebec-based companies.
posted by Mark, Ottawa at 10:13 a.m.
1 Comments:
Have a read here at the Industry Canada site:
http://tinyurl.com/oez3l7
This is what every contract that is being negotiated has to deal with. It is not a Conservative or Liberal thing, these are the rules that the past governments have put in place to try and mollify the press and public, to reassure the civilians that the dollars are being spent fairly across Canada and no foreign company is making money off of us.
Instead of worrying about buying the best equipment there are a ton of bean counters out there making sure it is "fair" and our money is well distributed.
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