B.C. shipyards deserve chance to compete for ferry contracts

VICTORIA - BC Ferries should buy new ships where ever they can get the best deal.
But it's irresponsible to bar B.C. shipyards from even trying to win construction contracts for new ferries that could be worth $500 million - 25 per cent of BC Ferries' capital budget for the next decade.
I'm not one of those who would argue that it's worth paying more to build the ships in B.C.
But this decision, in the words of Liberal MLA Dan Jarvis, looks "blatantly stupid."
BC Ferries needs two or three new mid-size ships, and hopes to award the contracts this fall.
But the government-owned business has already decided B.C. shipbuilders won't be allowed to bid. BC Ferries looked at the province's shipyards, and decided they were so hopelessly out of the picture that they couldn't even make the three-firm shortlist.
The work and the jobs will go to a European company, and B.C. shipbuilders won't even get a chance to try and win the contract.
Why? The answers from BC Ferries and Transportation Minister Kevin Falcon have been unconvincing. BC Ferries says they looked at the infrastructure available to B.C. shipbuilders - the cranes and the drydocks - and decided they just weren't adequate. Falcon says building the ferries here would cost $60 million more.
But how does Falcon know, if B.C. companies aren't allowed to bid? How does BC Ferries know the companies don't have an innovative solution, or whether they are prepared to invest?
I'm not saying that B.C. shipbuilders should get preferential treatment, or that BC Ferries should pay more to have the ships built here.
That would mean someone would be subsidizing the shipyards and their employees.
The money has to come from somewhere. If it's from taxpayers, a single mother in Nelson would have to pay more to subsidize a big U.S.-owned corporation.
If it's through fare increases, then every ferry trip would cost more than it needed to, and that also has economic implications - for tourism, for businesses dependent on the ferries and for individuals.
B.C. shipyards shouldn't be guaranteed the work. They should have to win it, in a fair an open competition.
But they deserve a chance to compete
It's hard to BC Ferries management and the Liberals are thinking. There's no obvious risk to allowing B.C. companies to bid. BC Ferries says these will be fixed price contracts, so if there are cost over-runs the shipbuilder will take the hit. And all the bids will be assessed to make sure the companies can deliver. Giving B.C. shipbuilders a fair chance would cost nothing.
Unless BC Ferries needs to discredit the capacity of the B.C. and Canadian industry in order to win a tax break. Canada imposes a 25-per-cent duty on ships built outside the country, because so many foreign governments subsidize their shipbuilders. BC Ferries plans to apply for an exemption, arguing that no Canadian shipyard could build the ships. (Federal Liberal MP Keith Martin says BC Ferries is wrong and opposes the exemption.)
The plan to slam the door on the B.C. industry before the competition even begins has come in for a quick attack from Jarvis, whose North Vancouver riding includes shipyards.
Building the ships overseas - Finland and Germany are the likely choices - would be "blatantly stupid," he says. B.C. companies have built the much bigger Spirit class ships an all the rest of the ferry fleet, he notes. "We're losing too many jobs everywhere and we certainly don't need to have it when I know we've got a pretty healthy shipbuilding industry."
There's an odd political irony here. The Liberals have constantly used the fast ferry disaster - rightly - as a symbol of NDP mismanagement. Now they've created their own political mess over ferry construction.
B.C. shipyards aren't entitled to handouts.
But they surely deserve a chance to compete.
Footnote: So much for the Liberals' hope that shifting BC Ferries from a Crown corporation to a semi-independent authority would protect the government from these kind of controversies. Government owns BC Ferries; taxpayers' subsidize it; and it's critical to the economy. This isn't just another decision by a private company.