Start from scratch on F-35 purchase, DND told

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An office created to oversee the acquisition of new jet fighters is pressing the Department of National Defence to start afresh on its F-35 Lightning purchase and consider whether Canada needs to buy a different plane.

It's not an option the military or the Prime Minister's Office relish discussing publicly as Ottawa refines its strategy for dealing with fallout from the Auditor-General's hard-hitting report on the $25-billion purchase.

But the question is circulating within a new secretariat that is now riding herd on the acquisition process that is being housed at Public Works and managed by deputy ministers from that department as well as Industry Canada and National Defence.

A senior federal official familiar with the workings of the secretariat said that the hope is that National Defence will see the benefits of starting from scratch to address public concern that the military selected the F-35 without considering alternatives.

So far, National Defence has shown no interest in budging from Lockheed Martin's F-35, with officials there suggesting the only thing that would derail the purchase would be a sharp increase in cost.

In a sign of internal divisions, high-ranking government executives outside National Defence are urging the department at least to consider other options as a way to demonstrate that it really selected the best plane.

"If the military were smart, they would do it themselves, unsolicited," one senior official said. "There seems to be an overwhelming public appetite to ask why [the government is]asking for this capability, and to be involved in a consideration of whether we should continue."

That would mean re-examining the Conservative defence policy statement that underpins the decision to pick the F-35: the 2010 document that calls for a "next generation fighter."

The Harper government promised on April 3 to hit the reset button on the F-35 purchase, but much of a seven-point plan it unveiled to address criticisms in the Auditor-General's spring 2012 report amount to ensuring it has clear cost information and sharing it with Canadians.

The government's plan was vague on whether Ottawa would genuinely start the acquisition anew and entertain alternative procurements – saying only that that it would "continue to evaluate options" for a 21st century fighter.

National Defence signed on to the F-35 program in 2006, and the government effectively etched the acquisition in stone in 2008 with its Canada First Defence Policy, which determined that the U.S.-built jet was the only option to replace the military's CF-18s.

Philippe Lagassé, an expert on military procurement at the University of Ottawa, said the government's response to the Auditor-General's report will be meaningless if the defence policy is not on the table.

"Will the secretariat receive a mandate to continue with the F-35 acquisition, or will it be asked to re-evaluate the entire process?" Mr. Lagassé said in an interview.

The ideal situation, he said, would be for National Defence to launch a cost-benefit analysis that could outline for Canadians the price of various aircraft in relation to their capabilities.

He said the government should entertain competing bids before selecting an aircraft.

"The government should call on the Canadian Forces to rewrite the [statement of operational requirements for the new jets]to allow for other aircraft to enter into a competition," Mr. Lagassé said.

The Prime Minister's Office isn't ready to address whether Canada must consider other aircraft.

The first order of business, it says, is to obtain reliable figures on the cost of the F-35.

"First things first. We have to get a proper accounting of where we are," said Andrew MacDougall, director of communications for the Prime Minister's Office.

"We're not going to get into hypotheticals."

At the public accounts committee of the House last week, Auditor-General Michael Ferguson did not specifically reject sole-sourcing the F-35 contract, nor did he state that Ottawa had to launch a competition.