House watchdog vows to pressure transport department over failed ferry purchase

Public hearings on the construction and failed implementation of two high-priced ferries for Newfoundland and Labrador’s intraprovincial fleet could take place this fall, the head of the House of Commons public accounts committee said. ‘Assembly.

Tony Wakeham said it is common practice for hearings to take place after the release of a report by the province’s auditor general.

“Members of [Department of Transportation and Infrastructure] will come and we will sit and ask questions, and the Auditor General will be there and we will follow up on any additional information regarding the recommendations, ”said Wakeham, Progressive Conservative MP for Stephenville-Port au Port and chair of the all-party committee of seven members.

The Office of the Auditor General’s final report on the process used to purchase the MV Legionnaire and the MV Veteran was released late last month.

The investigation was requested by the public accounts committee in 2018 following a series of mechanical issues and delays, and concluded that the Ministry of Transportation and Infrastructure had not effectively managed the construction and the preparation for service of the two ships.

It was “a real missed project management opportunity,” Auditor General Denise Hanrahan told CBC News.

Tony Wakeham is the MPP for Stephenville-Port au Port and chair of the House of Assembly’s seven-member public accounts committee. (Ted Dillon / CBC)

The missteps “may have contributed to significant operational delays, service disruptions and unforeseen costs” for both vessels, the report concluded.

Further, the report determined that the Ministry of Industry, Energy and Technology – formerly Industry, Enterprise and Rural Development – had not done enough to ensure the achievement of the business development initiatives promised by the shipbuilder.

The potential value of the direct expenses incurred by the Dutch shipbuilder Damen was over $ 1 million, with economic activity of tens of millions over a five-year period, but commitments such as a center of services, a local partnership and an arctic research center never materialized.

Wakeham said the committee is awaiting a written response from the Department of Transportation and Infrastructure on the report’s findings, and will then make a decision on whether to hold public hearings.

But the normal process is to have a public hearing, he said.

The Auditor General recommends that the Transport Department establish and follow a project management process for the supply of ships that meets industry standards, with particular attention to risk management, on-site supervision , document management and training. The report also recommends that the root causes of mechanical problems in ships be quickly identified and addressed.

Denise Hanrahan is the Auditor General of Newfoundland and Labrador. (Curtis Hicks / CBC)

Transport Minister Elvis Loveless said the ministry would act on the recommendations.

“Reading this report gives me some concern, but there are a lot of things we’ve done as a department that… we’ve certainly come a long way since 2013,” Loveless said recently.

The two ships and the improved dock infrastructure for ferry services to Bell Island and Fogo-Îles Change-Farewell Island cost the treasury almost $ 120 million.

The MV Veteran entered service at the end of 2015, followed by the MV Legionnaire in 2017.

According to the report, both vessels were completed on time, under contracts that were found to be generally in accordance with shipbuilding practices.

However, in the first three years of operation, both vessels reported a total of 607 days out of service, and some mechanical failures were the result of human error.

In fact, crew training was so lacking that the shipbuilder issued a warning to government officials.

And while the ships were under construction in Romania, there was insufficient oversight by the ministry, according to the auditor general, with the ministry’s project management team meeting only a few times during the procurement process.

The report also found that the department had a draft project management manual that followed best practices, but it had not been used.

Meanwhile, the Legionnaire was unable to begin operations on its planned route for 20 months after its construction due to delays in upgrading the wharf, a scenario that the Auditor General said could have been avoided with a better planning.

The two 80-meter ships were ordered by a former Progressive Conservative administration, with contracts signed in late 2013.

Despite being questioned several times, Wakeham declined to comment on the findings of the Auditor General’s report.

“We are trying to find out exactly where the ministry stands in relation to the recommendations that have been made,” he said.

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