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My take:
42 year life-cycle? Great. Fine. If you think the F35 will survive 42 years (not 42 and 5 months) fine. Let's stipulate that.
That means Canada will have some degree of Air Cover for 42 years.
The cost of supplying that degree of cover is 40 BCAD? Outstanding. Stipulated.
Now how does that stack up against the alternatives?
Alternative 1 -
Hypothetical - operating a brand new fleet of 65 F18A/Bs with the original avionics package for 42 years - do they cover the same ground, last as long, cost as much and do the same job.
That becomes your control benchmark.
Alternative 2
F18 AB with modern avionics over 42 years.
Alternatives 3a,b,c,d
Super Hornet, Typhoon, Rafael, Grippen over 42 years.
Compare and Discuss.
That need only be a paper exercise. No foreign trips. No field experiments. No prototype fly-offs. Just a straight across the board cost review. A review that is as germane to a discussion about what, if any, and how much air cover Canada wants/needs as it is to WHICH aircraft would be the best fit?
Surely somebody has as least a back of the envelope version of that programme somewhere in their files that they could use to demonstrate due diligence?
I have no problem with stipulating a 42 year cycle and finding a total cost of 40 BCAD.
Just don't come back to me in 2 years and argue that the F35 will, like the B-52, still be flying 100 years from now and thus the cost will be higher.
More years between capital acquisitions is a good thing. It tends to reduce the cost of providing a service.
More acres covered per pilot sortie is also a good thing as it also tends to reduce the cost of the service. Or, given a fixed budget, permits more acres to be covered for the same price.
BTW:
40 BCAD / 42 Years = 950 MCAD/Year to supply that service or 4 to 5% of a National Defence Budget of 20 BCAD in 2012 dollars
65 Aircraft at 70 MCAD with no replacement for 42 years = an annualized cost of 108 MCAD in capital costs. Equivalent to buying one new aircraft every 16 months.
If on the other hand you buy a cheaper aircraft with a shorter life-cycle, say 25 years then:
65 Aircraft at 60 MCAD with no replacement for 25 years = an annualized cost of 156 MCAD in capital costs. Equivalent to buying one new aircraft every 4 to 5 months.
Your cheaper aircraft actually costs you more over 42 years because it needs to be replaced more often.
42 year life-cycle? Great. Fine. If you think the F35 will survive 42 years (not 42 and 5 months) fine. Let's stipulate that.
That means Canada will have some degree of Air Cover for 42 years.
The cost of supplying that degree of cover is 40 BCAD? Outstanding. Stipulated.
Now how does that stack up against the alternatives?
Alternative 1 -
Hypothetical - operating a brand new fleet of 65 F18A/Bs with the original avionics package for 42 years - do they cover the same ground, last as long, cost as much and do the same job.
That becomes your control benchmark.
Alternative 2
F18 AB with modern avionics over 42 years.
Alternatives 3a,b,c,d
Super Hornet, Typhoon, Rafael, Grippen over 42 years.
Compare and Discuss.
That need only be a paper exercise. No foreign trips. No field experiments. No prototype fly-offs. Just a straight across the board cost review. A review that is as germane to a discussion about what, if any, and how much air cover Canada wants/needs as it is to WHICH aircraft would be the best fit?
Surely somebody has as least a back of the envelope version of that programme somewhere in their files that they could use to demonstrate due diligence?
I have no problem with stipulating a 42 year cycle and finding a total cost of 40 BCAD.
Just don't come back to me in 2 years and argue that the F35 will, like the B-52, still be flying 100 years from now and thus the cost will be higher.
More years between capital acquisitions is a good thing. It tends to reduce the cost of providing a service.
More acres covered per pilot sortie is also a good thing as it also tends to reduce the cost of the service. Or, given a fixed budget, permits more acres to be covered for the same price.
BTW:
40 BCAD / 42 Years = 950 MCAD/Year to supply that service or 4 to 5% of a National Defence Budget of 20 BCAD in 2012 dollars
65 Aircraft at 70 MCAD with no replacement for 42 years = an annualized cost of 108 MCAD in capital costs. Equivalent to buying one new aircraft every 16 months.
If on the other hand you buy a cheaper aircraft with a shorter life-cycle, say 25 years then:
65 Aircraft at 60 MCAD with no replacement for 25 years = an annualized cost of 156 MCAD in capital costs. Equivalent to buying one new aircraft every 4 to 5 months.
Your cheaper aircraft actually costs you more over 42 years because it needs to be replaced more often.
What HB said. . .
Plus . . In order to provide the same mission capability, how many additional aircraft would we need and have to pay? The F-35 has a lot of mission capability built in, capability that is either not available or bolted on to other aircraft.
Would we buy Growlers to get some radar killers?
The government screwed the pooch on the procurement and they'll mess it up again if they don't get their butts in gear and explain to Canadians what is going on. The Harper Deranged Media is at the lip lock service of the Opposition who care only to damage the government, not what is the best kit to get for the troops.
They should look to Norway. . . . The F-35 was marketed and sold to the Norwegians and the acquisition is very well accepted and the national media is onside . . . "Getting proper kit for our fighters" is the meme.
We can do that here but the tall forehead types at the Brick Brain need to put some neurons in gear.
Start by hiring HB_Pencil to write the success stories
Plus . . In order to provide the same mission capability, how many additional aircraft would we need and have to pay? The F-35 has a lot of mission capability built in, capability that is either not available or bolted on to other aircraft.
Would we buy Growlers to get some radar killers?
The government screwed the pooch on the procurement and they'll mess it up again if they don't get their butts in gear and explain to Canadians what is going on. The Harper Deranged Media is at the lip lock service of the Opposition who care only to damage the government, not what is the best kit to get for the troops.
They should look to Norway. . . . The F-35 was marketed and sold to the Norwegians and the acquisition is very well accepted and the national media is onside . . . "Getting proper kit for our fighters" is the meme.
We can do that here but the tall forehead types at the Brick Brain need to put some neurons in gear.
Start by hiring HB_Pencil to write the success stories
Kirkhill said:
You mean PBO or AG? No, this was done as part of the decision to chose the fighter internally at NDHQ with other departments support. I don't know if someone has directly said somewhere the outcome of the costing, though its been implied at several junctures. The main study was completed in 2008 and they reconfirmed the numbers in 2010.
Why hasn't this been made more clear? Probably because it would require the Government to disclose privy data, and expose them to claims that they should have run a proper competition.
Haletown said:Start by hiring HB_Pencil to write the success stories
See, I'm really just more interested in the reality of things than being a cheerleader. The problem is that the debate is so skewed right now that I'm basically seen as a one sided mouthpiece when I really dislike that role.
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Some site members seem to revel in it; you should read some of the politics diatribes.HB_Pencil said:
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HB_Pencil said:
WRT PBO and AG: I was presuming that it wasn't one of those. I was wondering if there was another report that had slid under my radar. Many do.
WRT "running a proper competition": What exactly does that mean? For some people, I believe, a competition isn't proper unless it involves members of the legal profession in voluble debate with decisions by impartial (ie unqualified in the field) judges.
I think the Government (and the Vendors) must be at the "publish and be damned" juncture. The only place this battle can be fought is in the press.
If they have a report that not only demonstrates due diligence, but the rationale for the decisions made to date, or validates those decisions it has to be released.
Kirkhill said:
Okay, these two paragraphs are related.
So a proper competition would have Canada develop a number of requirements, implement a rating system for them, release an RFP, the vendors submit their applications, its assessed and the decision is made.... basically the "normal process" that are specified in the AIT and GCR. DND in this case went to the vendors or the government operating the fighters and obtained data they needed to make a comparison. There were some shortcomings to this process, they didn't get all the data or to the level of confidence they wanted. However it should not have made a difference in the outcome. I also don't think that the government can release some of the data as it would be covered by the equivalent to Section 13(c) of the ATIP (foreign confidences).
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First off, HB, thanks for sharing - always good to get a bit more of the rest of the story.HB_Pencil said:
What you've said highlights the difficulty in assessing the case publicly.
The "glass is half full" crowd can say: See? There's been all SORTS of due diligence done - they just can't tell you exactly what and with who - trust them.
The "glass is half empty" crowd can say: If we can't see what's been done and what's been considered, how can we KNOW there's been what a lay person would consider a fair competition?
And all the shades of grey in between those two positions are coloured by how much one trusts 1) the politicians making the decisions, 2) the bureaucrats making the decisions and 3) whoever is sharing the message of the moment.
Throw in an element of media not always catching every nuance/not getting enough information to ask the right questions/only looking for or at what they want to, and it's a bit of a pig's breakfast of information to wade through.
Given this Friday 5:15pm talk to the media by the PM ....E.R. Campbell said:
http://forums.milnet.ca/forums/threads/2941/post-1193682.html#msg1193682
.... my guess now drifts toward #2.
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HB_Pencil said:
As Toni said: Thanks for that HB.
Your point about the discrepancies in the data is well taken. Every assessment I'm familiar with relies on assumptions and those assumptions are always open for challenge. Ultimately, however, they seldom impact the quality of the final decision.
WRT the Foreign Confidences I wonder which of the vendors would object to data release at this time. Technical data I can see being withheld. Capital costs and operating costs, both past records and future estimates, would surely benefit the vendors in bolstering their cases? Or do we believe that the French Air Force doesn't want to release the cost of operating their mis-matched assortment of custom built vehicles?
Kirkhill said:
Generally speaking the Government of Canada is pretty closed lipped about any foreign data. Its really a culture of protect anything just in case it might come back to bite us in the ***. Do a couple of ATIPs and the Section 13 is liberally applied. I've seen identical documents from the US and Canada... the US one is completely unredacted and full of pretty inane stuff. The Canadian one? Blacked out except the title.
By the way, you should look what the National Post just published. I'll let the article speak for itself.
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To employ a well-worn point of comparison:
"Federal government cuts will mean the CBC loses $115 million in funding over three years, according to the budget released Thursday.
The public broadcaster will see 10 per cent taken from its current $1.1-billion budget as part of a $5.2-billion cut to federal spending over three years. The budget will be trimmed $27.8 million for 2012-13, another $41.8 million in 2013-14 and a further $45.4 million in 2014-15 for a total of $115 million. That means the budget is set to be $115 million less from then on."
http://www.cbc.ca/news/politics/story/2012/03/29/federalbudget-flaherty-cbc-cuts.html
1100 MCAD - 115 MCAD = 985 MCAD x 42 years -
Cost of supplying the CBC as a service for Canadians = 41.4 BCAD
Cost of supplying Air Cover as a service for Canadians for 42 years = 45.8 BCAD
"Federal government cuts will mean the CBC loses $115 million in funding over three years, according to the budget released Thursday.
The public broadcaster will see 10 per cent taken from its current $1.1-billion budget as part of a $5.2-billion cut to federal spending over three years. The budget will be trimmed $27.8 million for 2012-13, another $41.8 million in 2013-14 and a further $45.4 million in 2014-15 for a total of $115 million. That means the budget is set to be $115 million less from then on."
http://www.cbc.ca/news/politics/story/2012/03/29/federalbudget-flaherty-cbc-cuts.html
1100 MCAD - 115 MCAD = 985 MCAD x 42 years -
Cost of supplying the CBC as a service for Canadians = 41.4 BCAD
Cost of supplying Air Cover as a service for Canadians for 42 years = 45.8 BCAD
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Awesome, awesome post.Kirkhill said:
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As far as the issue of sharing data publicly (or not)- why not swear the NDP and Liberal Defence Critics to Privy Council and show them the data in a locked room? It is what probably should have happened in the first place.
Kirkhill said:
Factor inflation in, like they did for the JSF. Numbers and that $41.4 BCAD to foist the CBC on Canada gets closer to $60 BCAD . . . . That's a WAG number and I would need the JSF study inflation factors before betting on it.
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Kirkhill said:
Remember the CBC is sole-sourced without a proper competition, as well!
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*YAWNNNNN*
**SARCASM**Just waking up after a couple of tiring days....did I miss anything??
**SARCASM**
On a serious note...nice to see that the RCAF numbers for the acquisition match up with the KPMG report.
It'll be interesting to read what the 42 year life cycle costs of a Super Hornet, SLAM Eagle, Typhoon, and others will be.
**SARCASM**Just waking up after a couple of tiring days....did I miss anything??
**SARCASM**On a serious note...nice to see that the RCAF numbers for the acquisition match up with the KPMG report.
It'll be interesting to read what the 42 year life cycle costs of a Super Hornet, SLAM Eagle, Typhoon, and others will be.
