Feds try to head off layoffs at shipyard
The federal government and Irving Shipbuilding are trying to figure out how to deal with a gap between construction of navy ships that could result in layoffs.
There will be a lull between the completion of work on the Royal Canadian Navy’s new Arctic offshore patrol ships and the construction of a new fleet of frigates called the Canadian Surface Combatants.
What will happen because of that lull is unknown but federal officials acknowledged at a news conference Monday they are worried about the potential loss of highly skilled employees and their expertise if shipbuilding work dwindles.
“It’s way too early to talk about layoffs,” said Kevin McCoy, president of Halifaxbased Irving Shipbuilding.
But the same production gap in the federal shipbuilding program is expected on the west coast, and unions there warn layoffs are coming. Seaspan Shipyards in Vancouver acknowledges there will be a lull between the construction of coast guard vessels, a situation it is trying to deal with by drumming up more work from the federal government or from the commercial marketplace.
Such gaps were supposed to be prevented by the government’s national shipbuilding strategy, which called for the continuous build of vessels, ensuring steady employment for a skilled labour force.
Lisa Campbell, a senior official with Public Services and Procurement Canada, said officials are now consulting with foreign shipyards and other countries on how to deal with what she termed a “downturn in production.”
“It’s something you see in shipyards around the world,” said Campbell, PSPC’s Assistant Deputy Minister — Defence and Marine Procurement.
Campbell said on the positive side, Irving and federal officials were working in advance to deal with the downturn before it emerges.
McCoy said the problem might be solved if Irving can convince other countries to purchase Arctic offshore patrol ships. In addition, the shipyard might be able to begin work sooner on some of the less complicated parts of the Canadian Surface Combatant project, the program to build 15 ships to replace the Royal Canadian Navy’s fleet of Halifax-class frigates.
Construction of those new warships isn’t scheduled to begin until the early 2020s and its unclear whether Irving could begin construction sooner to stave off the gap. Warship designers are to submit their bids for that project on Nov. 30 and a winner will be selected sometime next year, but ramping the project up is expected to take years.
McCoy made clear at Monday’s news conference that rival Davie Shipyards in Quebec would not be receiving any work on the various projects.
Davie has completed converting a commercial vessel into a supply ship for the Royal Canadian Navy. It proposed converting a second such ship so the navy can have a supply capability on each coast, but the federal government rejected that proposal. Davie warned that without the work it will have to lay off up to 800 employees in the coming months.
Quebec’s government has called on the federal Liberals to alter the national shipbuilding strategy to include Davie.
In 2011 when Irving and Seaspan were selected to construct new fleets, Davie was in financial trouble and passed over. But the firm is now back on its feet and wants a share of the action.