Feds Increase Military Spending While Providing Few Specifics, as Defence Policy Review Announced

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Followup to the announced $8 billion is needed to make an impact, says defence analyst

News Analysis

OTTAWA—The federal government increased defence spending in its April 7 budget, but details on how the money will be spent are lacking, as the feds also announced a review of its national defence policy. 

University of Calgary political science professor and defence analyst Rob Huebert told The Epoch Times that unless the amount offered in the budget is going to be drastically increased in subsequent budgets, then what Budget 2022 plans is fine; however, he says the roughly $8 billion in new spending announced on its own does not “move the mark.”

“It’s a five-year plan. The track record of the Trudeau administration and long-term plans for defence spending isn’t exactly good,” he said.

The feds did not provide a path to get to the NATO-required military spending level of 2 percent of gross domestic product (GDP).

“We are spending more on defence than what was planned prior to Russia invading Ukraine,” Deputy Prime Minister and Finance Minister Chrystia Freeland told reporters prior to the official release of the budget.

“We said that we will study very rapidly our military spending of Canada’s needs today in a situation that has changed a lot,” she added.

A senior government official said Canada’s defence spending as a percentage of GDP will reach about 1.5 percent in five years.

The largest component of the increased spending is $6.1 billion over five years to increase the capabilities of the Canadian Armed Forces (CAF). The spending is backloaded with just $100 million allocated to the current fiscal year, which has just started. Over half the $6.1 billion is penciled in for the final two years of the five-year projection horizon.

“We will wait and see what comes out of the defence review before we make further decisions,” said the senior government official.

Defence experts have recommended upgrading capabilities in the Arctic region as a top priority. Some of the $6.1 billion is to be allocated for North American Aerospace Defence Command (NORAD) modernization. 

The senior government official said that the work on NORAD modernization is to continue in tandem with the United States.

“So what you see in the budget is a decision on the part of the government to have those processes continue without Canada putting all of its cards on the table,” he said.

Underspending

Based on the 2021 NATO Secretary General annual report, Canada is spending 1.36 percent of its GDP on defence.

Huebert said that instead of fixating on the 2 percent target, if Canada moved on the F-35 fighter jets procurement, bought submarines, and purchased surface combatants, it would go a long way toward meeting the NATO requirement. And that does not include NORAD modernization.

“You start ticking off just capital programs, and we can, we could reach that number very easily,” he said. “In other words, you’re looking at effect, rather than just an artificial number.”

Spending from departments other than the Department of National Defence (DND) also counts toward the 2 percent of GDP defence spending target. For example, the Communications Security Establishment (CSE), which focuses on defending against cyberattacks, is not part of the DND budget even though the department reports to Defence Minister Anita Anand. Also, some spending from Global Affairs Canada (GAC) such as toward peace operations also goes toward the defence spending target.

Policy Review

“This budget … proposes a swift defence policy review to equip Canada for a world that has become more dangerous,” Freeland said in the budget document’s foreword.

Huebert said it’s good that “Strong, Secure, Engaged” will be reviewed as most Canadian governments don’t like coming back to review their defence policies.

Freeland called the threat from Putin “the biggest danger in the world today.” Of all the new defence spending measures announced, she highlighted the $500 million to be used for “further military aid” for Ukraine.

But officials with GAC and DND have told senators that China is actually the bigger longer-term threat.

China was hardly mentioned in the budget—and only regarding its latest COVID-19 outbreak.

But Huebert noted Freeland’s remarks in the budget about “the world’s dictators.”

“I think that the fact that she chose the words ‘world’s dictators’ rather than Putin in a part of the speech that is clearly directed towards Putin gives at least a little bit of hope that, in fact, when it comes to Strong, Security, Engaged … that means Russia and China,” he said.

In response to a question from The Epoch Times, the senior government official said, “The government has decided to launch [the review] for exactly those kinds of reasons [China’s threat, the Arctic, foreign interference].”

Spending the Money

A persistent problem with defence spending has been not being able to meet spending targets. The newly announced five-year spending profile is backloaded, as it factors in the time it takes to get money out the door on large capital spending projects. 

Freeland said the economy is a full 1.2 percent above where it was prior to the pandemic. Thus Canada has more defence spending catching up to do to meet its NATO obligations.

But where the rubber meets the road for defence spending is procurement, which has been a point of criticism of the feds.

Huebert said there’s been such mismanagement of procurement and there’s a need for more personnel and quicker political decisions.

“The only way that I think people are that follow this are going to have any satisfaction is an effort to reform their system, expand the number of officers they have working on these files,” he said.

In a commentary for the Conference of Defence Associations Institute, former deputy minister of defence Richard Fadden and former vice chief of the defence staff Guy Thibault provided three ways to improve defence procurement.

They say what’s key is “ongoing attention by the prime minister and appropriate ministers.”

“As Minister Anand has noted, Canada can get things done when it’s important—vaccine acquisition and distribution being the latest examples.”

The remaining amounts that make up the more than $8 billion in new defence spending include $765 million for the CSE, $500 million for Ukraine, a total of $449 million for the renewal of Operation ARTEMIS and expansion of Operation UNIFIER, and $242 million for supporting culture change in the CAF.

Rahul Vaidyanath

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Rahul Vaidyanath is a journalist with The Epoch Times in Ottawa. His areas of expertise include the economy, financial markets, China, and national defence and security. He has worked for the Bank of Canada, Canada Mortgage and Housing Corp., and investment banks in Toronto, New York, and Los Angeles.



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