A war of words has erupted between CAE and the Canadian government over the award of a Boeing CF-18 training system contract to Bombardier. The government has been forced to defend the decision after a leaked letter to new prime minister Paul Martin from CAE chief executive Derek Burney charged the company's bid was lower and had more Canadian content.
Defence minister David Pratt has defended the CF-18 advanced distributed combat training system procurement as "open, fair and transparent", arguing its fairness was confirmed by independent monitor BCMI Consulting. Burney has accused the defence minister of false, inaccurate and "highly misleading" statements.
Pratt says Bombardier's bid "represented the best value for Canadian taxpayers", with two-thirds of the contract featuring Canadian content. Burney says CAE's bid was C$44 million ($32.7 million) lower and argues that the C$127 million subcontract awarded by Bombardier to US firm L-3 Communications to supply the CF-18 training devices accounts for 60% of the total contact value.
L-3 subsidiary Link Simulation & Training says "elements" of its contract will involve Canadian content, citing visual database development by Ottawa-based Xwave. Burney points out that Canadian training device supplier Atlantis Systems, named as a participant in the Bombardier consortium, has not been allocated any work.
Pratt's statement that the North American Free Trade Agreement (NAFTA) "expressly prohibited" provisions for Canadian content is false, Burney charges, arguing that NAFTA has an "explicit exception" for national defence purposes that the US Department of Defense routinely invokes. While Pratt points out CAE has not launched an official appeal, Burney argues the company has been unable to submit its case to the Canadian International Trade Tribunal as the government has "withheld information" needed to launch a challenge.
GRAHAM WARWICK / WASHINGTON DC
Source: Flight International
