Annex B—About the National Shipbuilding Strategy—National Shipbuilding Strategy: 2016 annual report

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The National Shipbuilding Strategy will deliver much needed modern ships to the Royal Canadian Navy and the Canadian Coast Guard, and support the Canadian economy by constructing ships that would stimulate reinvestment in the broader Canadian marine sector.

The strategy is also meant to address the boom and bust cycle that has historically plagued Canadian shipbuilding, whereby shipyards expand their operations and hire and train new workers for major government contracts, only to scale back operations and lay off employees during periods of inactivity.

The strategy seeks to reinvigorate Canada’s shipbuilding industry by providing long-term domestic shipbuilding work, focused on 3 tiers:

  1. large-ship construction (vessels of more than 1,000 tonnes of displacement)
  2. small-ship construction (vessels of less than 1,000 tonnes of displacement)
  3. vessel repair, refit and maintenance

The strategy is helping restore our shipyards, rebuild our marine industry and create sustainable jobs in Canada while ensuring our sovereignty and protecting our interests at home and abroad.

A competitive process selected two shipyards, Irving Shipbuilding’s Halifax Shipyard and Seaspan’s Vancouver Shipyards Co. Ltd., to build the Royal Canadian Navy and Canadian Coast Guard's large ship combat and non-combat vessels. Irving was selected to deliver the ships for the combat package of the strategy for the Royal Canadian Navy, while Seaspan’s Vancouver Shipyards were selected for the non-combat vessels.

For the construction of smaller ships with less than 1,000 tonnes of displacement, Canadian shipyards other than Irving Shipbuilding and Seaspan’s Vancouver Shipyards have the opportunity to compete for individual projects, allowing important work to be spread throughout the shipbuilding sector. As well, all Canadian shipyards can compete for contracts for the repair, refit and maintenance of vessels.

In February 2012, Canada signed umbrella agreements with Irving Shipbuilding’s Halifax Shipyard and Seaspan’s Vancouver Shipyards Co. Ltd., highlighting the principles and general intent of the relationship. The umbrella agreements are long-term strategic sourcing arrangements that define the working relationships and administrative arrangements between the Government of Canada and the shipyards, and serve as the basis under which the government will negotiate fair and reasonable contracts for each project. They also provided a list of the respective ship construction projects within the combat and non-combat packages of work.

The strategy allows the government to make significant investments in Canada’s marine industry, such as developing and maintaining expertise and creating sustainable employment across the country. Furthermore, the strategy brings predictability to shipbuilding, eliminating the boom and bust cycles that have weakened the marine industry in the past.

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