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Our North, Strong and Free: A Renewed Vision for Canada’s Defence

  • Earlier this year, I announced a renewed vision for Canada’s defence: Our North, Strong and Free.
  • This policy will continue to strengthen the defence of Canada by investing in our people, our capabilities, and our capacity at home and abroad.
  • For example, we will increase our defence spending by $8.1 billion over the next five years, starting in 2024-25, and $73 billion over the next twenty years.
  • As we implement the policy through further investments, Canada is committed to spend 2% of its gross domestic product on defence by 2032.
  • This represents a credible, responsible, and achievable target date, which will allow Canada to ramp up its spending and procurement capacity on a realistic timeline.
  • We are making the investments necessary to protect Canadians, defend our North, and support our Allies in an increasingly unpredictable and interconnected world.
  • I am proud that we are continuing to invest in our world-class Defence team, who serve Canada with great courage and devotion.

If pressed on specific initiatives:

  • This policy is focused on credible deterrence at home and in North America, with a particular emphasis on the Arctic.
  • One example is the establishment of Northern Operational Support Hubs, which will enable a greater year-round military presence and responsiveness across the Arctic and the North.
  • It also includes important initiatives that will support our military members.
  • For example, we will establish a Canadian Armed Forces Housing Strategy to rehabilitate existing housing and build new housing.
  • We will also provide Canadian Armed Forces members with greater access to affordable childcare at bases.
  • We will further invest in current and new infrastructure, and develop sustained, strategic partnerships when working with industry, innovators, and researchers to build an effective defence industrial base.
  • In addition to many new initiatives, we continue to build a more inclusive and supportive force by pursuing the proposed legislative changes outlined in Bill C-66, which is currently in Second Reading in the House of Commons.
  • Ultimately, the policy laid out in Our North, Strong and Free will help maintain the security and prosperity that Canadians have long enjoyed, in addition to protecting and promoting Canadian interests around the world.

Key Facts

Our North, Strong and Free is laid out in four sections:

  • Section I assesses the current geopolitical context and the implications for Canadian interests;
  • Section II articulates an updated vision for our miliary, focused on ensuring the CAF is ready, resilient, and relevant in the new security environment; and
  • Section III and IV outline our plan to deliver on this vision, focused on strengthening the foundations of our military, modernizing existing capabilities and acquiring new ones, improving our capacity to implement through building civilian capacity, reforming procurement, digitalizing the military, leveraging innovations, and developing a stronger relationship with Canada's defence industrial base.

The policy features six major themes:

  • Supporting our people;
  • Strengthening our foundations;
  • Building an innovative industrial base;
  • Defending Canada;
  • Defending North America; and,
  • Defending Canada's global interests and values.

Investments:

  • $8.1 billion over the next five years.
  • $73 billion over the next twenty years.

Review Cycle:

  • Defence will undertake strategic policy reviews every four years, as part of an integrated update to Canada's National Security Strategy.
  • This deliberate approach will lay the foundations for sustainable, long-term success and continued growth in our defence capabilities.

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NATO Funding

  • Canada is unwavering in its commitment to the NATO Alliance, to the defence of Euro-Atlantic security, and to global security, prosperity, and the rule of law.
  • As we announced at the NATO Summit in Washington this summer, Canada is committed to spending 2% of its GDP on defence by 2032.
  • This represents a credible, responsible, and achievable target date, which will allow Canada to ramp up its spending and procurement capacity on a realistic timeline.
  • Our defence policy, Our North, Strong and Free (ONSAF),outlines $8.1 billion in new defence spending over the next 5 years, starting in 2024-25, and $73 billion over the next 20 years.
  • Further, our investments put Canada on track to exceed NATO’s target of 20% for major equipment expenditures as a proportion of defence spending in fiscal year 2025-2026.
  • We will continue to make significant but necessary investments to protect Canadians, defend our North, and support our Allies.

If pressed on specific NATO contributions:

  • Canada’s contributions to NATO are recognized by our Allies as a significant part of the Alliance’s contributions to peace and security in Europe and beyond.
  • Beyond the operational contributions we continue to make to NATO missions, we are supporting our Allies by investing in modern capabilities.
  • Just last year, we announced the procurement of a fleet of 88 F-35 fighter jets, up to 16 P8A Poseidon patrol aircraft, 9 Multi-Role Tanker and Transport aircraft, and 11 MQ-9B remotely piloted aircraft.
  • In addition, we are urgently acquiring anti-aircraft, anti-drone systems, as well as modern anti-tank weapons to reinforce our troops in Latvia.
  • Through ONSAF, we are investing heavily to acquire further capabilities over the years to come.

If pressed on the Parliamentary Budget Officer's post on NATO spending:

  • National Defence appreciates the work of the Parliamentary Budget Officer.
  • Given our different mandates, differences between how National Defence and the PBO approach defence spending are to be expected.
  • While the PBO has developed its own methodology to calculate GDP, National Defence uses data provided by NATO.
  • All NATO members must use the GDP data and benchmarks from NATO to ensure consistency amongst members.

Key Facts

Defence Spending

  • Fiscal Year 2024-25: Canada defence spending is projected to reach 1.37% of its GDP, with 18.6% devoted to major equipment, up from 1.31% of GDP and 14.8% on major equipment in fiscal year 2023-24.

NATO's Common Funded Budget

  • In addition to investing in their own armed forces, all NATO Allies contribute directly to NATO's budget based on an agreed cost-share formula derived from Gross National Income. Canada is the 6th largest contributor to NATO's common funded budget.

Parliamentary Budget Officer Blog Post

  • PBO released a short blog post on July 8, 2024, on total Canadian military expenditures and the NATO 2% target. Key PBO predictions include:
    • Canada's five-year average for defence spending as a percentage of GDP will be 1.44% (compared to ONSAF's forecasted average of 1.71%).
    • Expenditures will peak in 2025-26 at 1.49% before falling to 1.42% in 2029-30.
    • While the PBO does not expect National Defence's ONSAF forecast (released April 8, 2024) of 1.76% spending to GDP to be met, it expects the NATO target of spending at least 20% of military expenditures on major equipment will be met or exceeded.
  • The PBO applied a 25% discount on Canada's forecasted expenditures on major equipment due to a "high likelihood of delays" and lapsed appropriations, based on "recent experience and multiple PBO reports."
  • The PBO relies on its own methodology for calculating GDP, which the PBO says is "broadly similar to the Department of Finance's". National Defence uses Canadian GDP figures provided by NATO, which are based on inputs from the Organization for Economic Co-operation and Development (OECD) and other factors.

Details

NATO Centre of Excellence on Climate and Security (CCASCOE)

  • At the June 2021 NATO Summit, the Prime Minister announced Canada's proposal to establish and host a CCASCOE as its Framework Nation. In June 2022, Canada announced that Montréal will be the host city for the NATO CCASCOE.
  • This Centre of Excellence will be a platform for both military personnel and civilians to develop, enhance, and share knowledge on climate change security impacts. It will also allow them to work together to build required capabilities, develop best practices, and contribute to NATO's goal of reducing the climate impact of military activities.
  • Budget 2023 proposed to provide $40.4 million over five years, with $0.3 million in remaining amortization and $7 million ongoing, to Global Affairs Canada and the Department of National Defence to establish the NATO CCASCOE.
  • At the July 2023 NATO Summit in Vilnius, Canada and eleven Allies signed the CCASCOE's Operational Memorandum of Understanding (MOU) to become the Centre's founding Sponsoring Nations.
    • The twelve founding Sponsoring Nations of the CCASCOE are: Canada, Denmark, France, Germany, Greece, Italy, Latvia, Luxembourg, Norway, Romania, Türkiye, and the United Kingdom.
  • CCASCOE reached initial operating capacity in the late fall of 2023.

NATO Common Funding Contributions

  • Canada's share of NATO's common funding is now approximately 6.68% (~90% from National Defence and ~10% from Global Affairs Canada).
  • In fiscal year 2024-25, National Defence's contribution to NATO's military budget will be $327.8M. This contribution will support:
    • International Military Staff and NATO's Command Structure;
    • NATO's key air fleets: NATO Airborne Warning and Control System (AWACS), and Allied Ground Surveillance (AGS); and
    • NATO operations and missions, such as the Kosovo Force (KFOR) and NATO Mission Iraq (NMI).
  • In fiscal year 2024-25, National Defence's contribution to NATO Security Investment Program will be $127.1M. This will support capital costs for IT systems and assets, such as airfields and fuel storage.
  • In fiscal year 2024-25, National Defence's contribution to other NATO activities will be $5M. This will support:
    • NATO Centres of Excellence;
    • NATO Naval Forces Sensor and Weapons Accuracy Check Sites;
    • NATO Rapidly Deployable Corps Headquarters; and
    • NATO Production and Logistics Organizations (NPLOs).

Defence Innovation Accelerator for the North Atlantic (DIANA)

  • At the NATO Summit in Madrid, in June 2022, the Prime Minister announced Canada's intention to host the North American Regional Office of NATO's Defence Innovation Accelerator for the North Atlantic (DIANA). The proposed location of the Regional Office, in the Halifax area, was announced in November 2022.
  • DIANA aims to facilitate cooperation between civilian innovators, government scientists, and military operators to accelerate, test, and evaluate early-stage technologies, while also protecting technological solutions against threat activity.
  • DIANA will concentrate on new emerging and disruptive technologies that NATO has identified as priorities including artificial intelligence, big-data processing, quantum-enabled technologies, autonomy, biotechnology, novel materials, and space.
  • Budget 2022 allocated $30.1 million over four years, and $10.4 million ongoing to establish the new North American regional office in Halifax for DIANA.
  • In November 2023, the Minister announced that Canada is contributing an initial investment of $26.6 million over six years in support of establishing the North American Regional office for DIANA in Halifax.
  • The NATO DIANA North American regional office officially opened in Halifax on October 2, 2024.

Budget 2024

  • Budget 2024 provided foundational investments of $8.1 billion over five years, starting in 2024-25, and $73 billion over 20 years to the Department of National Defence (DND), the Communications Security Establishment (CSE), and Global Affairs Canada (GAC) to ensure Canada is ready to respond to global threats and to protect the well-being of Canadian Armed Forces members. These investments will be made along six major themes to:
    • support our people;
    • strengthen our foundations;
    • build an innovative industrial base;
    • defend Canada;
    • defend North America; and
    • defend Canada's global interests and values.

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