Lies, Damned Lies and Statistics

Mark Twain attributed British Prime Minister Benjamin Disraeli with saying “there are lies, damned lies and statistics.” The F-35 boondoggle has all three …

The Harper Government is digging itself deeper into the money pit that the F-35 has become. Never mind their fiscal deficit; they’ve got a growing truth deficit.

First they told us the planes would cost only $9 or 10 billion. Then they said $15 or 16 billion and they stuck to that one right through the election even though the figure they gave to Kevin Page, the Parliamentary Budget Officer, in March 2011 was nearly $18 billion.

Pre-production model of F-35 in flight ca 2010.

Oh well, what’s a billion dollars here or there in an election, eh?

Then, when the Auditor General raised an eyebrow (and a whole lot

of questions) in March of this year, the Department of National Defence said: Oh, by the way, we didn’t count the cost of keeping the F-35 in the air – you know little things; like pilots and gas.

Peter MacKay, who should know – after all he’s the Minister in charge – confirmed this by saying the Government had the “real” figure all along. Just add 10 billion to the 15 billion dollar cost of acquiring the jets and Bob’s your uncle.

Oh, and by the way, said Associate Defence Minister Julian Fantino, pay no attention to Norway’s Rear Admiral Roksund. He told the Standing Committee on Defence that Norway is planning to pay, for acquiring and operating the same plane, exactly double the Harper Government’s $25 billion estimate.

The cost of one F-35 before the election. The $70 million figure here has now climbed to $750 million per plane, or ten times the Tory estimate, if the Norwegian purchase price is also ours.

In early April 2012, at the Summit of the Americas, Mr Harper himself dug the hole a little deeper. He said that the figures his Government used publicly were only for the acquisition of the F-35s.

“Other numbers cited, obviously have to do not just with the acquisition of the F-35, but operations of the F-35. In terms of our numbers,” the PM said, “I’ve been very clear.”

Problem is, none of this is true. The government’s estimates are still absurdly low. The DND confessed to Mr Page they couldn’t provide a rationale for the figures they gave him. And the government’s own figures for the cost of the plane – made public in the Budget Officer’s report before the election – include both acquisition and operations.

It’s all right there on page 10 of Kevin Page’s report. Cost of acquisition? $6 billion. Cost of operating and support? $9 billion. Cost of misleading the public during an election? Priceless.

 © David McLaren April 2012. 

From the Parliamentary Budget Officer’s Report on the F-35,
March 10, 2011

From page 10 of PBO Report March 2011

DND Additional Costs include costs for project management, infrastructure, weapons, and a contingency. The PBO has not included these costs in its estimate. In addition, while the PBO operating and support cost is based on a 30-year program life, DND’s operating and support cost is based on a 20-year program life. For purposes of comparability, PBO has increased the DND’s forecast operating and support cost on a pro-rata basis to reflect a 30-year program life.

Cost estimates from any source, including the PBO, should be seen in the context of the methodology employed, the available data, and the desired confidence interval. The PBO sought clarification from DND on the methodology employed, the data, and the desired confidence interval that form the basis of the government’s costing figures. DND confirmed that such analysis has not yet been undertaken. (page 9)

In response to the PBO’s question as to the constituent elements of DND’s acquisition cost of US$ 9 billion, DND responded that it was to include research, development, testing and evaluation [RDT&E]. (footnote page 22)

Historical data for strike/fighter aircraft exhibit a well-defined pattern of exponential increase in specific production cost. Such a plot for combat aircraft is illustrated in Pugh, P. G. (2007). Source Book of Defence Equipment Costs. Bedford, UK: P. G. Pugh, 46.

RDT&E poses a significant risk and may increase the cost Canada pays. The RDT&E phase is yet to be completed, and with low rate production started, there remains significant risk of costs increases. Between 2001 and 2009, there have been growth figures of 40% for RDT&E and 54% for production.72 It is yet unclear how these costs will be distributed among purchasers. (page 36)

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About David McLaren

David McLaren is an award-winning writer. He has worked in government and the private sector, with NGOs and First Nations in Ontario. He is currently writing from Neyaashiinigamiing on the shore of Georgian Bay and can be reached at david.mclaren@utoronto.ca. In February 2015, he won the nomination for the NDP to represent the riding of Bruce-Grey-Owen Sound in the 2015 federal election. See that page for writings during the campaign.
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One Response to Lies, Damned Lies and Statistics

  1. Reblogged this on LIBERAL SIDEROADS and commented:
    This great piece from David McLaren, who lives on the Peninsula and is one of my favourite bloggers on all things political….

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