Nobody in the government or the Department of National Defence comes off well in this politico-techno-bureaucratic mess:
The acquisition process to replace our aging CF-18 fighter jets can now officially be proclaimed as the F-35 boondoggle.
In a damning report Tuesday, Auditor General Michael Ferguson said the whole process in which the Harper Conservatives decided to allocate at least $25 billion over the next 20 years to buy 65 F-35 Lightning II “fifth generation” fighter jets was gummed up by Department of National Defence bureaucrats — and possibly air force officers — who flat out lied to their political masters and to Parliament about the costs and risks associated with the program.
The only good news is we have not yet spent that $25 billion or signed any contracts.
Canada has generally been well served by the civil service (I grit my teeth to say that, as I’m not at all fond of big government), if only in comparison to other countries. One of the better inheritances from Britain is the (relatively) non-political, impartial bureaucracy. In this case, however, the bureaucracy has failed, and failed spectacularly:
But the politicians, like any prime minister or cabinet minister before them, has to be able to rely on the bureaucracy to give them the straight goods.
That did not happen.
Here’s Ferguson in his report: “National Defence told parliamentarians (last year) that cost data provided by U.S. authorities had been validated by U.S. experts and partner countries which was not accurate at the time. At the time of its response, National Defence knew the costs were likely to increase but did not so inform parliamentarians.”
In other words, DND bureaucrats lied. Full stop. Period.
Here’s another paragraph from Ferguson: “Briefing materials did not inform senior decision-makers, central agencies, and the Minister [of National Defence] of the problems and associated risks of relying on the F-35 to replace the CF-18.”
And another: “We found that the ministers of National Defence and Industry Canada and those ministers on the Treasury Board were not fully informed (in 2006) about the procurement implications.”
I’ve been less-than-fully-supportive of the F-35 acquisition, as a quick perusal of F-35 related posts will show, but this is now much more important than the question of what aircraft (if any) the RCAF will be purchasing. It’s now a case of finding out how deep the rot is in the DND and whether the RCAF actively aided the deception. If so, heads must roll.
Update: MILNEWS.ca has a round-up of reporting on the Auditor General’s report, focusing on the F-35 program.
Lots of news, most of it just plain crap. I read somewhere that one complaint is that DND only reported the cost of the program over 20 years, instead of 36 years. Wow, if you add 16 years of use you will add to the cost! Who knew?
Someone on another forum I read had a great example of variable accounting.
If we reporting buying a car like an F-35 (over 10 years):
Vehicle with taxes = $18,000
Insurance (annual) = $995/year (x 10) = $9950
Oil Changes = $35/change x 30 (3 every year) = $1050
Tire Roatations = $20 (x 10) = $200
Annual Tune Ups = $100 (x 10) = $1000
Wind Shield Wipers = $50 every year (x 10) = $500
Wind Shield Fluid = $40 every year (x 10) = $400
Brakes = $400 (x 3) = $1200
Electrical Work = $600
Replace battery = $200
Total “true cost” is $33,100! Imagine that! If we added in maintenance and upgrade cost to every thing we have (house, car, boat, bike, etc) then yes the total cost over its expected life will always seem staggering. Nice propaganda trick.
Of course, he is missing the cost to train the techs who fix the car, as well as spare parts that may not be needed but have to be on hand. You get the picture though. The reporting of the figure doesn’t put any context on the spending, they just keep throwing numbers out there too. $25 Billion, $30 Billion… who cares that it is over 20 or 30 years, and that it comes out of the actual defence budget and isn’t just paid for outside of that ministry. It sounds like a lot of money all at once, and that is what they want people to think. And some talking head asks us to imagine what the government could do with that money, if it didn’t spend it on F-35s… like we don’t need SOMETHING to replace the 30 year old CF-188s.
Not to mention the thousands of “experts” out there who don’t think we need fighter aircraft, let alone a military. Of course these are the great-grandchildren of the morons who told us Hitler wasn’t a threat, he just wanted some space.
I listen to this crap, see the headlines, and all I can think of is that the media just keeps flinging shit at the CPC in hopes that something will stick and make them smell bad to Canadians. Eventually it may work, mainly because the media just keeps it up and the populace seems to have a real short memory. Remember Robocalls? Seems as though that will fall away into silence as it didn’t stick. I read that there were 800 complaints across 200 ridings! Wow, what is that, like, 4 calls per riding affected… yup, that will turn the tide and affect democracy!
Comment by Dwayne — April 4, 2012 @ 23:03
The cost accounting never seems to be done on the same basis, which only adds to the confusion when the media (or government spokesfolks) use a figure calculated over one span of time but the other figures are all up-front costs, or calculated over a different timespan. Sometimes it’s just an inadvertant confusion of how the numbers are calculated … too many other times it’s a deliberate attempt to mislead the listener about what is actually being discussed.
Big-ticket items like military hardware should always be presented in the same way so that non-accountants can do back-of-the-envelope comparisons. If an F-35 will cost $100 million in up-front costs, and an F/A-18F will cost $60 million on the same basis, we can decide for ourselves whether that extra $40 million per plane is going to be worth it to get the promised extra features of the more expensive plane. If, however, the F-35 cost is presented as total lifecycle cost, while the F-18 is only initial purchase plus training and 5 years of spare parts, we can’t come to any conclusion because the numbers are not directly comparable.
And you’re quite correct that a significant number of Canadians still believe that the only purpose for our armed forces is to be human shields between hostile factions in far-away conflicts. That way, they don’t need heavy weapons, tanks, fighter aircraft, or frigates. A quick whip-round the local army surplus store to collect old uniforms and a can of bright blue paint is their idea of a proper military budget. Many folks under the age of 30 have been taught that Canada “has always been a peacekeeping country” and “never has gone to war”.
Comment by Nicholas — April 4, 2012 @ 23:32
Therein lies the problem, and the media just exacerbates it by shoddy reporting. Even the Parliamentary Budget Officer buggered it by changing the length of life cycle vice what DND used. And then the AG and the media accuse DND/CF of lying, because the numbers from a broad range of people, using different ways to calculate costs, don’t agree. Also, let’s not forget the amount of air time the CBC and CTV then give to Bob Rae and Tommy Mulclair to rail against Stephen Harper and the CPC… all I heard on the CBC this morning was Bob Rae raging away, demanding that Harper resign…what a damn fool! And shame on the CBC for never challenging this boob when he makes such stupid and outrageous statements! Just burns my butt that they provide a propaganda platform and not provide thoughtful news and analysis.
One other problem that DND/CF suffers is that we have a whole occupation, Public Affairs Officers, who try and get out a message that essentially gets ignored. Have a look at this page:
http://www.forces.gc.ca/site/news-nouvelles/news-nouvelles-eng.asp
Tell me how many of those releases the media actually report so that the public will know what is going on? In the end it doesn’t matter what the message is because the media isn’t listening to them.
I am so happy I am only 2 years away from retiring… I am getting tired of knitting parts for airplanes and hoping that the 20 people I lose during posting season are replace by at least 10 trained techs instead of 20 TQ3s. 🙂
Comment by Dwayne — April 4, 2012 @ 23:57
The more opinion pieces I read (they don’t merit the title news) the more I can see the spin.
http://www.cbc.ca/news/politics/story/2012/04/05/pol-ferguson-committee.html
In this CBC hit piece you find this near the end:
PMO responds
The Prime Minister’s Office released a statement Thursday evening in an attempt to clarify the costs of the F-35 program.
The government says it responded to the Parliamentary Budget Office in March 2011, estimating the cost of acquiring 65 jets at $9 billion and sustainment costs for maintenance, software programming and logistic support at a further $5.7 billion, for a total cost of $14.7 billion over 20 years.
The estimates did not include operating and salary costs, the government says, which would be incurred regardless of the aircraft purchased. These costs would amount to $9 billion over 20 years.
The government says it accepts that these costs should have been included in its report to the PBO.
Now, how does anyone calculate the cost of something? Any sane person? Usually it is the off the shelf cost. But here we have a “claim” that the CPC lied… but when you read it you can see that it isn’t a lie. Because no one should include the operating cost of a plane over 20 years because you don’t know how much it will really be! How much was jet fuel 20 years ago? How much jet fuel does an F-35 burn per hour? (we can use known numbers right now, but is that a realistic measure?) Would you include the cost of fuel for your car in the estimate of how much it will cost over 20 years? Would you include the cost of mechanics? How about including them if you employ them anyway?
You can see how this is all smoke, mirrors and pure bull in the papers and on TV now. You can say damn near anything because no one knows how to account, because everyone uses whatever measure they want to to make it look however they want it to look. The PBO came back with costs over 35 years and included operating costs and personnel costs… what an ass! And then they say that the CPC, DND, and the CF lied because they didn’t use the PBO methodology? Why didn’t the PBO use DND methodology? If he did there wouldn’t have been anything to report! And so, here we are now, with numbers ranging from $9 Billion to $60 Billion being thrown around like they are all true, and we still have not committed to buying anything, and we have nothing to show for 15 years of being part of the program.
Comment by Dwayne — April 5, 2012 @ 21:02
Thanks for the mention – much appreciated!
Comment by MILNEWS.ca — April 9, 2012 @ 17:13