The Canadian government is prepared to pay the US Navy double the amount originally agreed upon in 2014 to acquire torpedo upgrade kits for its Victoria-class submarines.
On Sept. 24, 2014 the US Congress was informed of a $41 million deal to sell 12 MK-48 Mod 7 Advanced Technology Torpedo Conversion Kits and related logistics to the Canadian military.
$21 million of the price tag was for “major defense equipment” (MDE) while the remainder was for technical and support services.
That cost has since doubled to a new price of $89 million due to “cost increases, obsolescence, hardware failures and hardware rework,” according to an Oct. 20 transmission to Congress.
“The production of the conversion kits has experienced material cost increases, obsolescence, hardware failures, and hardware rework, which have delayed delivery to Canada. The estimated total MDE value will remain $25 million. The non-MDE value will increase by $48 million, resulting in a new estimated total value of $89 million,” claimed the notification.
In an emailed statement given to True North, the Department of National Defence (DND) confirmed that Canada was prepared to accept the higher costs, although it has not received a formal request for the extra funding.
“Canada has not yet received a formal request from the United States Navy for additional funding. Though details have yet to be finalized, DND is aware that this request is forthcoming, likely in early 2023,” DND Media Relations told True North.
“We acknowledge this issue and are prepared for a higher cost than originally expected. Based on current class maintenance schedules, we now expect upgrades will be completed fleet-wide by 2027.”
It is unclear whether the price could further grow by the time the torpedo kits are delivered. According to the Canadian Taxpayers Federation, the federal government should explain itself as to why military procurement always goes over budget.
“How come every time we hear about military procurement, we hear that the costs are going way over budget?” asked CTF Federal Director Franco Terrazzano.
“Someone in the bureaucracy needs to figure out how to do military procurement without always spending way over budget.”
Currently, Canada has four Victoria-class submarines stationed in Esquimalt, British Columbia. According to a recent disclosure tabled in the House of Commons maintenance and repairs for the submarines have surpassed $3 billion.
“The Heavyweight Torpedo Upgrade (HWTU) project will upgrade the main weapon of Canada’s Victoria-class submarines from the MK48 Mod 4M torpedo to the Mod 7AT torpedo,” explained DND.
“The HWTU project will provide the related torpedo upgrade kits, warshots, exercise torpedoes, simulators, trainers, and spare parts – thus ensuring that our Armed Forces have the tools that they need to keep Canadians safe.”
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