- Reaction score
- 1,709
- Points
- 1,060
From the 2010 fall report
“We found that National Defence’s needs and priorities were not precisely defined at the outset and… were not finalized until the contract with Boeing was signed in 2009…The June 2006 statement of operational requirements was not reviewed or endorsed by the Senior Review Board or by the Joint Capability Requirements Board until October 2006 and, consequently, did not benefit from the rigorous challenge these bodies are expected to provide… The intended configuration of the Canadianized Chinook evolved as decisions were made… According to National Defence, the seven high-level mandatory requirements could have been met by a basic Chinook model (emphasis added). However, in the process of detailing its specifications with Boeing, National Defence also drew from the set of rated operational requirements, effectively treating extended-range fuel tanks, an upgraded electrical system, and aircraft survivability equipment as mandatory requirements, though none had been originally identified as such. These additional modifications resulted in significant changes to a basic Chinook model and also had an impact on the timing and complexity of certification for airworthiness…
The full extent of modifications was not initially presented to decision makers.… We disagree with the characterization of this helicopter as being off-the-shelf. It is evident that from the beginning, National Defence did not intend to procure an off-the-shelf Chinook but rather a modified one… So significant were the modifications to the basic Chinook helicopter that Boeing’s estimate included nearly US$360 million for one-time engineering costs… National Defence knew, prior to seeking preliminary project approval from the Treasury Board and issuing the ACAN, that significant modifications to a basic Chinook were desired and planned. It knew also that these would increase the risks to cost and schedule. However, this was not presented to the Treasury Board when seeking preliminary project approval… Ultimately, Canadian-required modifications increased the cost of each aircraft by 70 percent more than initially quoted by Boeing in early 2006 (emphasis added). This prolonged the negotiation of the contract by over two years and delayed the delivery of the aircraft.”
…Overall, in our opinion, the manner in which PWGSC used the 2006 ACAN did not comply with the letter or intent of the applicable regulations and policies and, consequently, the contract award process was not fair, open, and transparent. In addition, we believe a second ACAN should have been issued in 2009 and should have included the final helicopter requirements and specifications, the revised delivery and certification schedule, an indication of willingness to pay one-time engineering development costs, and other significant changes made to the project scope.”
The OAG report compares the C$ 2 billion advertised cost for 16 helicopters with the current C$ 4.9 billion, but it’s not an even comparison because the current program total includes long term support contracts, and the original cost did not. They do note, correctly, that planned delivery of the first fully capable CH-147 has been delayed from 2008 to 2010, and then again to 2013, while the buy was cut to 15, due in part to poor decision making within DND”
Don't get me wrong, I don't get seriously excited about how much the CAF capital equipment procurements cost as I often think we spend way too much time,money and resources trying to maintain to tight of a control especially on the big purchases, but playing fast and loose always comes back to bite the CAF on the ass
“We found that National Defence’s needs and priorities were not precisely defined at the outset and… were not finalized until the contract with Boeing was signed in 2009…The June 2006 statement of operational requirements was not reviewed or endorsed by the Senior Review Board or by the Joint Capability Requirements Board until October 2006 and, consequently, did not benefit from the rigorous challenge these bodies are expected to provide… The intended configuration of the Canadianized Chinook evolved as decisions were made… According to National Defence, the seven high-level mandatory requirements could have been met by a basic Chinook model (emphasis added). However, in the process of detailing its specifications with Boeing, National Defence also drew from the set of rated operational requirements, effectively treating extended-range fuel tanks, an upgraded electrical system, and aircraft survivability equipment as mandatory requirements, though none had been originally identified as such. These additional modifications resulted in significant changes to a basic Chinook model and also had an impact on the timing and complexity of certification for airworthiness…
The full extent of modifications was not initially presented to decision makers.… We disagree with the characterization of this helicopter as being off-the-shelf. It is evident that from the beginning, National Defence did not intend to procure an off-the-shelf Chinook but rather a modified one… So significant were the modifications to the basic Chinook helicopter that Boeing’s estimate included nearly US$360 million for one-time engineering costs… National Defence knew, prior to seeking preliminary project approval from the Treasury Board and issuing the ACAN, that significant modifications to a basic Chinook were desired and planned. It knew also that these would increase the risks to cost and schedule. However, this was not presented to the Treasury Board when seeking preliminary project approval… Ultimately, Canadian-required modifications increased the cost of each aircraft by 70 percent more than initially quoted by Boeing in early 2006 (emphasis added). This prolonged the negotiation of the contract by over two years and delayed the delivery of the aircraft.”
…Overall, in our opinion, the manner in which PWGSC used the 2006 ACAN did not comply with the letter or intent of the applicable regulations and policies and, consequently, the contract award process was not fair, open, and transparent. In addition, we believe a second ACAN should have been issued in 2009 and should have included the final helicopter requirements and specifications, the revised delivery and certification schedule, an indication of willingness to pay one-time engineering development costs, and other significant changes made to the project scope.”
The OAG report compares the C$ 2 billion advertised cost for 16 helicopters with the current C$ 4.9 billion, but it’s not an even comparison because the current program total includes long term support contracts, and the original cost did not. They do note, correctly, that planned delivery of the first fully capable CH-147 has been delayed from 2008 to 2010, and then again to 2013, while the buy was cut to 15, due in part to poor decision making within DND”
Don't get me wrong, I don't get seriously excited about how much the CAF capital equipment procurements cost as I often think we spend way too much time,money and resources trying to maintain to tight of a control especially on the big purchases, but playing fast and loose always comes back to bite the CAF on the ass
…Canadian Chinooks do now and will in the future operate autonomously at the types of extended rates that precisely demand the final configuration that the CH-147F ended up in. And anybody who tries to portray that the RCAF was building the Chinook with gold to put on defensive protection suites? Then I know such a person would be just parroting some imperfect assessment from the AG. Just because she and her team wrote it, doesn’t make everything inside accurate. The last bit I’ll critique was her point that senior leaders didn’t look at the specific requirements developed for….three whole months! Imagine taking 90 days to get reviewing something that would take another 8-10 years by the very process mandated in DND by government. I mean, it’s not like there was much going on with the CAF in 2005-2006, right? 
