Public Works and Government Services Canada

Public Works and Government Services Canada

August 04, 2006 16:17 ET

Public Works Issues an Update on the Procurement Processes for the Purchase of Military Aircraft

OTTAWA, ONTARIO--(CCNMatthews - Aug. 4, 2006) - Public Works and Government Services Canada today issued a progress report regarding the procurement projects for the purchase of the Defence Department's Medium- to Heavy-Lift Helicopters and for the Strategic and Tactical Aircraft posted on July 5th, 2006, by the Government of Canada.

On that day, PWGSC issued an Advance Contract Award Notice (ACAN) on MERX, the government's electronic tendering system, for the Medium- to Heavy-Lift Helicopters, and for the Strategic Aircraft. Although market research indicated that in each case there was only one supplier who could meet the needs of the Canadian Forces, the government chose to use the ACAN process to give the opportunity to other interested suppliers to demonstrate that they also can meet the mandatory capabilities for each project. These two ACANs closed today, August 4, 2006.

For the Medium- to Heavy-Lift Helicopters, a challenge has been received to the Advance Contract Award Notice (ACAN) as at least one supplier has submitted a Statement of Capabilities to demonstrate how they can meet all the advertised requirements.

Similarly, a challenge has been received to the Advance Contract Award Notice (ACAN) for the strategic airlift requirement as at least one supplier has submitted a Statement of Capabilities to demonstrate how they can meet all the advertised requirements.

"From the outset, I have said that the procurement of military aircraft for Canada's armed forces would be done in a fair, open and transparent manner, in line with this Government's commitment under the Federal Accountability Act," said the Honourable Michael M Fortier, Minister of Public Works and Government Services (PWGSC).

"By using these ACAN processes, we allowed potential suppliers to demonstrate their capabilities in a fair and transparent manner while also enabling the government to meet the immediate operational requirements of Canada's armed forces," Minister Fortier added.

The Government will evaluate the validity of the suppliers' statements of capabilities and if one or more have demonstrated that they can meet all of the requirements, PWGSC will issue a full call for formal bids.

For the tactical airlift requirement, a draft Solicitation of Interest and Qualification (SOIQ) document was also posted on MERX from July 5, 2006, to Friday August 4, 2006. The draft SOIQ lets PWGSC benefit from the expertise of the supplier community, making the actual SOIQ a better description of what the government wants and how it will evaluate bids and suppliers. It also provides potential bidders with a fast and relatively inexpensive way of determining whether they can and want to participate in the bidding.

Following this advertisement, PWGSC received confirmation from at least one supplier who indicated an interest in competing for the requirement. The government may amend the draft SOIQ to reflect the feedback received from the supplier community - then issue the formal SOIQ.

Potential suppliers will then be invited to demonstrate their ability to meet mandatory high-level performance criteria. Those that do will be invited to submit a formal Proposal as the final stage of the process.

"Each acquisition contract will have 100% industrial benefits right here in Canada, meaning that for every dollar the Government of Canada pays a contractor, the contractor must spend an equivalent amount inside Canada," Minister Fortier added.

Details regarding these specific procurement projects are available in the attached backgrounder.


Backgrounder

Procurement Methods for DND's helicopters and aircraft

Following is a description and progress report on the procurement methods being used by Public Works and Government Services Canada to acquire medium-to heavy-lift helicopters and strategic and tactical aircraft for DND:

1. Medium- to Heavy-Lift Helicopters - ACAN process

On July 5, 2006, PWGSC issued an Advance Contract Award Notice (ACAN) on the government electronic tendering service, known as MERX, for the purchase of these aircraft. This ACAN closed on Friday August 4, 2006.

Although market research concluded that the Boeing CH-47 Chinook helicopter was the only aircraft capable of delivering a suitable off-the-shelf aircraft in a timely manner, a challenge has been received to the Advance Contract Award Notice (ACAN) as at least one supplier has submitted a Statement of Capabilities to demonstrate that they can meet all the advertised requirements.

The Government will now evaluate the validity of the suppliers' statements of capabilities. In instances where full review of a challenge concludes that a Statement of Capabilities must be rejected, a second higher-level review of the rejection will be conducted, to ensure objectivity and fairness to the challenger.

This method of procurement avoids issuing a call for bids when only one supplier can respond successfully; fosters industry competition; ensures fairness and transparency; and meets the government and suppliers' needs for an efficient and cost effective procurement system.

Schedule

Contract award is expected in the summer of 2007 (or sooner if possible). The first aircraft is to be delivered as soon as possible, but no later than 36 months following contract award. The last aircraft will be delivered within 60 months of contract award.

2. Strategic Airlift - ACAN process

Although market research concluded that there was only one cargo aircraft (C-17 Globemaster III) currently in production that meets the minimum mandatory capabilities of the Canadian Forces, an Advance Contract Award Notice (ACAN) indicating the Government's intention to award a contract to Boeing was posted on MERX, the government electronic tendering service, on July 5th, 2006 for the purchase of these four aircraft. The ACAN process allows government to determine if additional capable products and suppliers exist.

This ACAN closed on August 4, 2006. A challenge has been received to the Advance Contract Award Notice (ACAN) as at least one supplier has submitted a Statement of Capabilities demonstrating how they can meet all the advertised requirements.

The Government will now evaluate the validity of the suppliers' statements of capabilities; and if the statements are deemed valid because the challengers have demonstrated that they can meet all the requirements, PWGSC will issue a full call for formal bids.

This is a fair, open and transparent process that permits suppliers with products or capabilities unknown to the government to demonstrate that they can meet the Armed Forces' specific requirements.

Schedule

Contract award is expected in the spring of 2007. The first aircraft is to be delivered as soon as possible, but no later than 18 months following contract award. The last aircraft will be delivered within 48 months of contract award.

3. Tactical Airlift -SOIQ procurement approach

A stepped approach is being used while at the same time fostering a strong two-way relationship between stakeholder departments and industry.

PWGSC publicly advertised this opportunity to industry through a Draft Solicitation of Interest and Qualification (SOIQ) document that was posted on MERX from July 5, 2006 to Friday, August 4, 2006. The draft SOIQ allows industry to comment on the solicitation before it is formally posted.

Following this advertisement, PWGSC received confirmation from at least one supplier who indicated an interest in competing for the requirement and provided comments related to the SOIQ.

These comments will now be reviewed with National Defence and Industry Canada to determine their validity prior to issuing the formal SOIQ.

The formal SOIQ will invite potential suppliers to indicate their interest in competing for this project and to demonstrate their ability to meet the mandatory, high-level performance criteria before being invited to submit a formal Proposal as the final stage in the process.

To reduce risk to the Government of Canada, the aircraft must be certified to aviation certification standards recognized by Canada by the contract award date, rather than being certified at the time the aircraft is delivered.

Schedule

Contract award is expected in the fall of 2007. The first aircraft is to be delivered as soon as possible, but no later than 36 months following contract award. The last aircraft will be delivered within 60 months of contract award.

PWGSC news releases are also available on our Internet site at www.pwgsc.gc.ca/text/generic/media-e.html

Contact Information

  • Office of Minister Fortier
    Jean-Luc Benoit
    Director of Communications
    (819) 997-5421
    or
    Media Relations
    Public Works and Government Services Canada
    (819) 956-2315