The federal authorities is refusing to say why it quietly cancelled a contract for refurbished army automobiles for Ukraine that the Canadian firm concerned says it’s nonetheless “prepared, prepared and in a position to provide.”
Defence Minister David McGuinty told the House of Commons defence committee this week that his division had cancelled the contract with Armatec Survivability in Dorchester, Ont., close to London, to refurbish 25 mild armoured automobiles, however stated he couldn’t clarify the rationale behind the choice.
Conservatives say the contract’s cancellation dangers making Canada seem as an unreliable ally to Ukraine and undermines the Liberals’ dedication to bolstering the home defence business.
“Till simply within the final week, all people thought this undertaking was simply delayed however was nonetheless on monitor for supply, and Armatec was nonetheless saying that they only wanted the funds to start out flowing so they may begin refurbishing the automobiles,” defence critic James Bezan stated in an interview Thursday.
“I blame the federal government on this one.”
Conservatives tried to get solutions from Stephen Fuhr, the secretary of state for defence procurement, on the Home of Commons defence committee Thursday on why the contract was cancelled, however Fuhr deferred to McGuinty and the Division of Nationwide Defence (DND).
“I don’t know” why the contract was cancelled, Fuhr repeatedly stated.
Conservative MP Scott Anderson requested Fuhr how a lot of the $250 million he stated the contract was price has been misplaced, and whether or not the cash was included in Canada’s plan to achieve two per cent of GDP in defence spending this fiscal yr.
Fuhr stated he didn’t know and that Ukraine army help contracts usually are not inside the jurisdiction of the brand new Defence Funding Company he’s been tasked to steer.
A DND spokesperson stated the division couldn’t touch upon the contract with Armatec “attributable to confidentiality obligations.”
The Canadian Business Company, which has facilitated authorities procurement contracts for Ukraine support, deferred inquiries to the DND.
Armatec has been awarded thousands and thousands of {dollars} in Canadian defence contracts since 2007, according to government records. It primarily refurbishes and enhances army automobiles for the Canadian Armed Forces, and has also supplied parts to the U.S. military and different allies.
Armatec CEO Karl Pfister advised World Information his firm stands able to maintain doing that work, however wouldn’t remark past a written assertion he stated was permitted by legal professionals.
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“What I can say is Armatec is prepared, prepared and in a position to provide infantry combating automobile upgrades and related expertise to Canada and our allies in help of self-defence efforts and the necessity to re-arm Europe,” he stated.
“I can also say that Armatec is a Canadian firm utilizing Canadian employees to advance Canadian innovation and expertise with a view to the deployment of infantry combating automobiles that surpass present Canadian capabilities.”
Bezan stated the corporate is below a non-disclosure settlement with the federal government that forestalls it from saying something extra, placing Armatec in “an unattainable place” as its “long-term survivability” is at risk.
He stated it’s the primary time he’s seen a contractor prevented from talking after a contract is cancelled.
“I’ve by no means seen the Authorities of Canada gagging a contractor that’s making an attempt to ship tools to help Canada and our allies. That is weird,” he stated.
“The query is, what are the Liberals making an attempt to cover?”
Why might a defence contract be axed?
Richard Shimooka, a senior fellow on the Macdonald-Laurier Institute who research defence coverage and procurement, stated there are a number of the explanation why a contract just like the one with Armatec might be cancelled, however couldn’t converse to the precise particulars.
He famous that many of the mild armoured automobiles in query had beforehand been deployed by the Canadian army in Afghanistan, and have been “in all probability fairly beat up” through the decades-long conflict there.
“It’s doable these automobiles are in a lot worse situation than was anticipated and (Armatec) might say ‘it’s now not financially doable for us to do it below the contract phrases,’ and the federal government put its foot down,” he stated in an interview for instance of an element that might spur cancellation.
“Given the Canadian penchant for working automobiles nicely previous their prime, so to talk, it’s price asking what sort of materials situation have been they delivered in?”
Shimooka doubted the cancellation spoke to a broader cost-cutting technique by the Liberal authorities or a shift in its method to aiding Ukraine. Reasonably, he stated it’s extra probably the federal government needed the undertaking finished “rapidly” and determined that was now not doable.
Bezan stated clear solutions are wanted.
“Up till the summer season, the Ukrainians have been nonetheless ready and questioning the place these automobiles have been, and nonetheless needed them,” he stated. “And there’s no dedication by the federal government to really substitute this with the rest.
“It simply exhibits the hypocrisy of presidency that they are saying they help Ukraine, however don’t ship. They are saying that they will help defence business and are strolling away from them, costing jobs. And, you recognize, that is about guaranteeing that we’ve got the defence functionality.”
The DND advised World Information that Canada “stays unwavering in its help for Ukraine and its precedence to supply army support that’s each well timed and instantly operational for Ukraine’s Armed Forces.”
“As a part of the $2 billion in further army help introduced by Prime Minister Carney, Canada can be taking a look at offering further armoured capabilities to Ukraine,” the spokesperson stated.
“We’re expediting different contracts by the Canadian Business Company to get efficient capabilities into Ukrainian palms as quickly as doable.”
The Prime Minister’s Workplace says the extra $2 billion in army support consists of $835 million for armoured automobiles and different crucial tools.
Canada is within the strategy of delivering 50 armoured automobiles constructed by London, Ont.-based Normal Dynamics Land Methods-Canada below a separate $650 million contract signed in 2023.
The primary automobiles have been delivered to Europe in June 2024, and McGuinty stated Tuesday that the remaining automobiles are on monitor to be delivered by the tip of this yr.
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