The Harper government has inked a contract to build its long-promised Arctic patrol ships, but it had to increase the overall project budget to get there.
Officials from Public Works and National Defence, along with Irving Shipbuilding President Kevin McCoy, made the announcement today in Ottawa ahead of a planned event next week in Halifax.
The entire program is now expected to cost $3.5-billion, instead of the $3.1-billion initially proposed when the ships were first announced back in 2007 as part of the Conservative government's ambitious plan to rebuild the military.
The agreement is to construct six of the light icebreakers for the navy's use in the North and off both coasts, but officials acknowledge that could slip to five if the program runs into trouble.
The deal provides incentives to Irving to keep costs down in order to deliver all six ships on time and on budget.
The parliamentary budget office warned last fall that delays and the corrosive effect of inflation would force the Conservative government to buy fewer ships if it stuck with the original budget envelope.