July 24, 1944 (19th Parliament, 5th Session)


Mr. McLARTY: (Secretary of State of Canada)


1. Yes.
2. Six contracts for a total of 21,926 units have been placed with Addison Industries Limited at cost plus 5 per cent with provision for firm prices after costs were determined. The price agreed upon for the first contract for 776 sets was $521.97 per unit after audit.
3. A formal tender was called from Rogers-Majestic Corp. but at the time this store
(Mr. Usley.]
was required all radio manufacturing companies, including the aforementioned company, were working to capacity on other sets. It was considered by the engineers in charge of the development of this equipment that to place orders with these companies would disturb the production of other types of radio equipment which were urgently needed. Addison Industries Limited, who were not under contract for other radio material, were thus available and were chosen to make the "Walkie Talkie". Departmental engineers worked with the company and assisted in the development of the set. After development had been completed the first contract for 776 sets was placed on the basis mentioned in answer to question 2.
4. No. For reasons given in answer to question 3, and in view of a request from the Acting Deputy Minister of National Defence (Army) that because of the development work done jointly by the department and Addison Industries Limited the contracts should be placed with this company, it was not considered feasible or wise to call for tenders. Many changes in design have since occurred, a circumstance more easily met by having the contracts with one firm rather than several.
5. Ultimate prices are not known. Present contracts are being paid at a billing price of $505 per unit. Audits are being conducted with a view to arriving at an ultimate price and placing remaining contracts on a firm price basis if possible.
6. Yes. See answers to questions 2, 3, 4 and 5.

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