Canada's F-35 -- the $46 billion dollar boondoggle

Later today, the Amsterdam based accounting firm Kynveld Peat Marwick Goerdeler (KPMG ™) will issue a report regarding the proposed procurement of 65 Lockheed-Martin F-35-A Lightning II fighter jets for the Canadian Air Force.   If media previews are to be believed, the program will be way higher than the $9 billion originally claimed by PMS and Co.   Higher than the $30 billion suggested some time ago by the Parliamentary Budget Officer.   (And who knows how much the Auditor General, Canada's top accountant, will say it is when he files his findings in an upcoming quarterly report).

KPMG will say that the actual cost of the jets, including maintenance over a projected 36 year life cycle will, in fact, be anywhere from $40 to $46 billion.   At an original sale price of $75,000,000 per pop, plus about $9 billion in maintenance costs the government originally claimed, we're looking at a boondoggle that is 3.5 to 4 times originally budgeted.    Worse, the Canadian share of maintenance contracts will be only $9 billion, most of the rest will likely go to the States.    Keep in mind the $75 mill was the original price -- current estimates are actually about $150,000,000 off the shelf; which jumps to about $250,000,000 with weapons systems attached plus adaptations for Canada's very harsh climate both winter and summer.

Military contracts gone out of control has been the bane of too many governments both left and right.   One thinks of relatively "minor" infractions over the years such as the feds providing infrastructure money for building overpasses for highways that were originally decades away from being built (the roads often later tolled despite commitments from the provinces not to do so, were later fast-tracked due to safety issues on arterial roads, inclement micro-climates, or both).

But this goes way beyond that.   The Air Force is our first line of military defence -- not just against hostile régimes such as North Korea (which finally has succeeded in launching a three stage rocket, putting the Canadian and American West Coasts firmly in the Kim dynasty's sights) -- but also against the current and equally ominous threat of terrorists who are fighting for some kind of "nation" but actually neither have a country nor can have something taken away from them that which they have already renounced.

Of course, this branch of the military, perhaps even more so than the other two (Army and Navy) needs to have the best possible equipment.    We as civilians should demand nothing less for our courageous men and women.

But as on the civilian side of all matters fiscal, we need to also insist not just on value for money (a single engine fighter jet is a cockamamie idea for the obvious reason) but also that midstream and back-ended costs are properly calculated and budgeted for.   In the present circumstance, it also requires the manufacturer warranty any unexpected repairs and for an extended period, for all or most of the anticipated life cycle.   If the plane is sold more or less as is, then it becomes a bill of goods.

The fact that the purchase decision for this particular plane was made almost totally untendered (by the previous Liberals who started the ball rolling, unfortunately) is bad enough.   But the Con government couldn't just blame things entirely on their predecessors    Despite growing evidence that the maintenance costs were much higher than claimed, indeed were getting more and more expensive as time went on, the executive kept sticking to the lower figure.

If the government misrepresented the truth in Parliament then they are in contempt of the national legislature.   In that case, Harper has to have the guts to say "I'm sorry."   Two simple words.    If Michael McCain of Maple Leaf Foods ™ could do so on tainted meat products, then the PM has a duty to do so on something far more grave than that -- nothing should be more important to the duties of our head of government than national security.    I'm not talking about going public the launch codes for our non-nuclear (which all of them are) missiles.   That of course, should be a closely guarded secret.   I'm talking about transparency of the kind that ensures we have the confidence that what we are buying for the military is the best equipment at the best price.

I'm not the only one who's suggested this but we need to start all over, albeit on a fast track process, and have bureaucrats from a non-military department go through the potential bidders and pick what is truly the best one -- just as we did for the Navy procurement program recently.

This is one hell of a Christmas present.   In this case, we get stuck with a huge lump of coal -- pretty much all the coal mines in the country's production for several years worth.   If no one's minding the store on this file, who knows what big surprise lies ahead next?