Funding
Budget 2022 Commitments – National Defence
- National Defence stands ready to defend our security and will always be there for Canadians.
- That is why Budget 2022 allocates over $8 billion (on a cash basis) over five years to bolster the capacity of the Canadian Armed Forces support our members and promote culture change.
- This includes $6.1 billion on an accrual basis ($7.4 billion cash) to increase defence capabilities, improve continental defence, and support commitments to our allies.
- It also allocates $244.8 million on an accrual basis ($246.5 million cash) to promote culture change, modernize the military justice system, and to expand health and physical fitness services to be more responsive to women.
- We will carry out a swift defence policy update to ensure that the Canadian Armed Forces is supported and ready for a world that has become more dangerous.
- We will continue to make strategic investments in the Canadian Armed Forces to ensure they can keep Canadians safe and contribute to operations around the world.
Key Facts
- Budget 2022: A total $8B new funding over five years—on top of planned increases associated with Strong, Secure, Engaged, including:
- $7.4B for continental defence, commitments to our allies, investments in equipment.
- $99.2M for modernizing the military justice system and culture change.
- $144.3M to expand the Canadian Armed Forces’ health services and physical fitness programs.
- An additional $500M in 2022-23 to provide further military aid to Ukraine.
- Defence Policy Update: Budget 2022 announces an update to allow Canada to update its existing defence policy.
Details
- Budget 2022 includes a total $8 billion new funding over five years—on top of planned increases associated with Strong, Secure, Engaged.
- This funding will strengthen Canada’s contributions to core alliances; bolster the capabilities of the Canadian Armed Forces; continue to support culture change and a safe and healthy working environment in the Canadian Armed Forces; and reinforce Canada’s cyber security.
- This funding includes:
- $6.1 billion over five years, starting in 2022-23, with $1.3 billion in remaining amortization, and $1.4 billion ongoing to the Department of National Defence in order to meet defence priorities, including:
- continental defences,
- commitments to allies, and,
- for investments in equipment and technology to immediately increase the capabilities of the Canadian Armed Forces.
- $100.5 million over six years, starting in 2021-22, with $1.7 million in remaining amortization, including $3 million over three years from existing reference levels, and $16.8 million ongoing to:
- strengthen leadership in the Canadian Armed Forces;
- modernize the military justice system;
- bring into force the Declaration of Victims Rights as set out in the National Defence Act; and,
- undertake engagement and consultation on culture change.
- $144.3 million over five years, starting in 2022-23, and $31.6 million ongoing to address shortcomings in meeting specific healthcare needs of, and support fitness improvements for, women and gender-diverse members of the Canadian Armed Forces (CAF).
- $9.5 million over five years, starting in 2022-23, to the Department of National Defence to align its operations and engagement with Indigenous peoples with the United Nations Declaration on the Rights of Indigenous Peoples Act.
- $6.1 billion over five years, starting in 2022-23, with $1.3 billion in remaining amortization, and $1.4 billion ongoing to the Department of National Defence in order to meet defence priorities, including:
Previous Allocations for Defence:
- In the past year, including through Budget 2021, the federal government had announced a range of programs and initiatives, including:
- $847 million over five years to maintain Canada’s military at a higher state of readiness under the North Atlantic Treaty Organization (NATO) Readiness Initiative, and to increase Canada’s contributions to NATO’s common budget and military activities; and,
- $252 million over five years, with $160 million in remaining amortization, to lay the groundwork for North American Aerospace Defence Command (NORAD) modernization and sustain existing continental and Arctic defence capabilities.
Defence Policy Update:
- Budget 2022 announces a defence policy update to allow Canada to update its existing defence policy, Strong, Secure, Engaged, in support of its broader international priorities and the changed global environment.
- The update will focus on, amongst other things, the size and capabilities of the Canadian Armed Forces; its roles and responsibilities; and making sure it has the resources required to both keep Canadians safe and contribute to operations around the world.
Budget 2022 And Departmental Figures
- National Defence manages the largest and most complex departmental budget and is a responsible steward of public funds.
- The budget cycle outlines future spending and may be different than actual approved spending.
- Planned spending may change as part of normal financial and operation processes.
- For example, Budget 2022 contained a new funding package worth $8 billion, on top of the funding originally forecasted in the Departmental Plan and Strong, Secure, Engaged.
- We announced this new funding in recognition of the emerging and unforeseen challenges we are facing here at home, and across the globe.
- This is why we take steps to explain the ongoing changes through reporting to committees and other parliamentary mechanisms, like the Parliamentary Budget Officer.
- We will continue to make strategic investments in our Forces and will be open and transparent in these endeavours.
If pressed on Budget 2022 figures vis-à-vis Departmental Plan:
- Budget 2022 include forecasted capital funding, as well as funding for Canadian Armed Forces operations such as Operation REASSURANCE.
- This differs from information in the Departmental Plan, which only includes funding for which the department has authority to spend.
- The $15 billion in military spending outlined in Budget 2022 does not appear in the Departmental Plan, as the Departmental Plan only reflects spending that has been approved by the Treasury Board and for which parliamentary approval has been requested.
- The difference is attributable to recently announced policy measures, including those in Budget 2022, as well as funding for previously approved capital projects that still require Treasury Board approval and inclusion in the Estimates.
Key Facts
- Departmental Plan vis-à-vis Budget 2022:
- The largest difference between the forecasted National Defence planned spending in Budget 2022 and the Departmental Plan, is major Strong, Secure, Engaged capital projects that do not yet have Treasury Board authorities.
- As for Canadian Armed Forces operations, associated incremental funding is only accessed in-year and therefore not reflected in the Departmental Plan as planned spending.
- These would include Operations IMPACT, REASSURANCE, UNIFIER, ARTEMIS, and peace support operations.
- Budget 2022: A total $8B new funding over five years—on top of planned increases associated with Strong, Secure, Engaged, including:
- $7.4B for continental defence, commitments to our allies,
- investments in equipment.
- $99.2B for modernizing the military justice system and
- culture change.
- $144.3M to expand the Canadian Armed Forces’ health services and physical fitness programs.
- An additional $500M in 2022-23 to provide further military aid to Ukraine.
- Capital Investment Fund:
- National Defence’s new funding model – the Capital Investment Fund – was introduced with Strong, Secure, Engaged.
- The Capital Investment Fund ensures that we have the flexibility to effectively manage the funding needed to acquire new and replacement assets (our capital budget).
- The funding model focuses on long-term affordability, and helps ensure delivery of the overall capital program.
- It also provides the department with the required flexibility to adapt the annual capital funding levels to align with the actual funding requirements of the projects.
- Defence Policy Update: Budget 2022 announces an update to allow Canada to update its existing defence policy.
Lapsed Funding
- National Defence manages a large and complex budget with major equipment and construction initiatives that need funding over many years.
- That is why we introduced a new funding model in 2017 to ensure that projects get the money they need when they need it.
- This means that money can be re-allocated to support priority projects within a given year, or moved forward to support needs in future years.
- Despite long-term planning, certain projects may not progress as scheduled as timelines shift.
- National Defence continues to work with industry to address the impacts of COVID-19 and deliver on major projects outlined in Strong, Secure, Engaged.
- We will continue to direct committed funding when needed, ensuring the military has the equipment they need to succeed in operations at home and abroad.
Key Facts
- Of the $1.2B in lapsed funding in 2020-21, $1.06B is available for future years and consists of:
- $855.1M for adjustments to Vote 5 spending on capital equipment and infrastructure;
- $186.7M for adjustments to Vote 1 and Vote 10 spending;
- $18.6M in Carry Forward (for operating expenditures); and,
- $0.4M in proceeds from the disposal of surplus Crown assets.
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