Twelve years ago, Chantier Davie, of Lévis, was excluded by the Harper government from the National Shipbuilding Strategy, which prevented it from participating in contracts worth $35 billion at the time for the delivery of 29 large ships to the Canadian Navy.
Two shipyards were favoured, Seaspan in Vancouver and Irving Shipbuilding in Halifax. It is true that Chantier Davie was experiencing financial difficulties at the time, but the company could rely on a strong Italian buyer. That Irving was on the shortlist came as no surprise. On the other hand, Seaspan did not have the facilities or the expertise to build ships of this size, while Chantier Davie owned and still owns the largest dry dock in Canada.
The Harper government had entrusted the choice of sites to a so-called independent committee, but everything can be told by a committee to which the selection criteria are dictated. At the time, in pharmacies in Ottawa, it was whispered that the decision to dismiss Davie was linked to the very effective lobby of the powerful Irving family. More recently, a lawsuit was filed against Vice-Admiral Mark Norman, who was accused of having been the source of a leak that the Trudeau government, under pressure from the Irvings, had decided to withdraw the few crumbs of naval contracts that the previous government had left to Davie. The pursuit was dropped; it’s a shame because the trial would certainly have taught us many things.
It goes without saying that in 2011, this decision to deprive the Lévis shipyard of part of these fabulous and structuring contracts was perceived, rightly, as an injustice in Quebec. The Couillard government did try to obtain redress. In 2017, Philippe Couillard himself was in the street with Davie workers and CSN permanent workers to demand fair treatment for the site. It was certainly not in his character to pose while demonstrating.
In retrospect, the fact of having selected two shipyards rather than three hardly smiled on the client. Entangled in delays, the Irving shipyard has yet to deliver a ship. Costs for its share of contracts to build 15 combat ships have skyrocketed from $26 billion to $84 billion, according to the latest projections. More modest, the contracts awarded to Seaspan experienced similar setbacks.
In late 2019, the Trudeau government announced that Chantier Davie could finally join its naval strategy and that a contract for six icebreakers for the Canadian Coast Guard — that number is now seven — was within reach. But to be able to officially qualify, the yard had to be modernized at great expense, present a solid financial base and comply with the best international practices. The conditions are now met, Prime Ministers Justin Trudeau and François Legault announced on Tuesday.
To achieve this result, the CAQ government, which is not averse to being interventionist in economic matters, had to pull out all the stops. In a new limited partnership, Davie Infrastructure, which will be responsible for building the icebreakers at an estimated cost of 8.5 billion, the State will invest 520 of the 840 million needed, including 194 million in capital and the rest under the form of a “forgivable” loan, linked to the jobs created, that is to say non-repayable in whole or in part. François Legault talked about the creation of 1800 jobs. The future of the site, which has been living for ages, is guaranteed for more than 20 years, we boasted.
Chantier Davie Canada is now owned by the London-based company Inocea. A major development could strengthen the expertise of the Lévis shipyard. Davie is now in talks to acquire Finnish icebreaker builder Helsinki Shipyard Oy.
Alongside Justin Trudeau in Lévis on Tuesday, François Legault was very happy to be happy. This is the kind of economic project that excites him: the creation of ” jobs paying” in the long term. Federal health underfunding has now been forgotten and the Caquiste Premier will be able to present the example of Davie as another of those “gains” that his government has the gift of making within the federation.
It is to silence the fact that this contract of 8.5 billion which is presented as an incredible windfall constitutes only a fraction of the value of the orders placed with the two other shipyards, that is to say less than 10% in reality. The message could be this: when it comes to surviving, you have to make do with leftovers.