If Auditor-General Michael Ferguson's word is to be believed - and there is no reason to think that it isn't - then the federal cabinet and by extension the prime minister, and not just the anonymous gnomes in the Department of National Defence, are directly on the hook for the F-35 boondoggle, in the most egregious sense.
They knew before the 2011 federal election that the jets would cost billions more than had been stated by DND - at least $10 billion more, around $25.1 billion. They allowed the department to publicly state they would cost $14.7 billion.
"I can't speak to individuals who knew it, but it was information that was prepared by National Defence," Ferguson told reporters Thursday. "It's certainly my understanding that that would have been information that, yes, the government would have had."
He continued: "That $25 billion number was something I think that at that time was known to government." And, critically: "It would have been primarily members of the executive, yes."
So, this is no longer a matter of "it happened on their watch." It's a matter of whether there was outright deception, deliberate and premeditated, during an election campaign, on an issue of great national import, by the prime minister and members of the cabinet.
Again, if the auditor-general is to be believed - one has to qualify, so explosive are his remarks - then the Harper government's credibility is in tatters, as is the prime minister's personal credibility. With more than three years to run in their mandate, the Tories have driven the bus into a concrete wall of their own making.
Ferguson's remarks do not occur in a vacuum: to anyone familiar with the inner workings of DND, they will ring true. DND Deputy Minister Robert Fonberg and assistant deputy minister (matériel) Dan Ross typically handled matters related to the F-35 procurement. It was standard practice for all information on major procurements, including costs, to be passed to the inner cabinet. It is highly unlikely, on its face, that anything as important as these numbers would have been withheld from the PMO.
But that's not the half of it. Consider Ferguson's audit, in the section on life-cycle costs. The initial estimate of $75 million US a plane did not include the cost of drag chutes for landing on short runways, or modifications to the refuelling system that DND knew would be necessary. But more important, the estimates of life-cycle costs - including the higher and real number of $25.1 billion, which DND and apparently the cabinet withheld - were for 20 years only.
"This practice understates operating, personnel, and sustainment costs, as well as some capital costs, because the time period is shorter than the aircraft's estimated life expectancy. The JSF Program Office provided National Defence with projected sustainment costs over 36 years."
Thirty-six years, versus 20? So, even $25.1 billion for 65 planes is an artificially low number. Nor does it account for the cost of the 14 replacement aircraft that, based on historical attrition rates, DND would need over the life of the project. That was to be a "separate project in the future," Ferguson's report states.
Anyone familiar with the accounting shenanigans that led to the great techstock collapse of 2000 will recognize this for what it is: fraud. It is accounting trickery, designed to bamboozle.
The government now says, in its formal response to the audit, that the F-35 project budget has been frozen at $9 billion - as though that's supposed to allay concerns. But Associate Defence Minister Julian Fantino has been saying this for months. It doesn't unsnarl the central tangle, which is that neither $9 billion nor $14.7 billion nor $16 billion nor even $25.1billion for that matter are credible. The simple truth is that no one, not even aircraft maker Lockheed Martin or the Pentagon, has a clue now how much it will cost to buy 65 F-35s, or 45, or 10.
To call this a colossal, monumental bungle is an understatement. As things stood before Thursday, the Harper government had few defenders on this file. It was not even really bothering to defend itself, hewing to the ancient Canadian tradition of taking one's spanking when the auditor-general comes calling, no matter how sharp the sting, drying one's tears and moving on.
But if the inner cabinet knew, as Ferguson suggests, that DND's numbers were way low, even as they demonized the parliamentary budget officer, whose pre-election cost estimate of $30 billion now turns out to have been much closer to the truth, and as they taunted the opposition, and as they insisted, week after week, that it was all about doing what's best for our brave men and women in uniform?
If that's true then they will have no defenders, anywhere. Cabinet-level resignations yes, as a starting point. But it's bigger than that. The government itself will be discredited.
There is no moving on from a lie this big.
Source: vancouver sun
Author: Michael Den Tandt