Strong, Secure, Engaged fundamentally changed the way National Defence manages its budget.
National Defence only requests the resources we need to manage our budget each year.
These transactions are reviewed by Parliamentarians through the estimates process, and capital resources that we do not request are available to the department in future years.
This allows us to effectively manage resources when delivering procurements over multiple years, and ensures requirements are as accurate as possible before requesting additional funds.
It also allows the flexibility to re-allocate Capital funding between existing projects or move funds forward to support needs in future years.
Finally, we "carry forward" as many unused operating funds as possible as a planned lapse.
For instance, in 2019-20, National Defence was unable to spend $930.9 million, of which $835.7 million is expected to be made available for use in future years.
While the COVID-19 pandemic presents new challenges, we will continue to ensure that funds requested by National Defence have a meaningful impact on defence priorities.
Key Facts
National Defence public account lapse (difference between funding requested and expenditures):
$930.9M was lapsed in 2019-20, of which $835.7M is expected to be made available for future years.
$473.4M was lapsed in 2018-2019,of which $390.9M was available for future years.
$677M was lapsed in 2017-2018, of which $652.9M was available for future years.
This flexible funding model allows National Defence to manage changes in project developments such as:
lower contract amounts;
changes in required capabilities to meet new threats;
additional time needed to analyse options; and,
delays in the delivery of goods and/or services by industry.
Details
Despite sound long-term planning, most defence procurement projects do not advance exactly as planned—some progress faster, others slower, for a variety of operational, logistical, and program reasons.
To mitigate lapses in funding authorized by Parliament, National Defence is taking the following actions:
Improving its capital funding forecast to ensure that the Department does not request more funding authorities from Parliament than required;
Funding new projects from surplus in-year funding rather than requesting additional funding from Parliament;
Funding not requested is not lost. National Defence has the ability to re-profile funds into future years for major projects, and then access those funds when needed.
