Defence Spending

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• Budget 2022 and Departmental Figures
• NATO Funding

Budget 2022 and Departmental Figures

Key Facts

Details

• Budget 2022 Figures vis-à-vis Departmental Plan:
  • On April 22, 2022 the Parliamentary Budget Officer published a report entitled Budget 2022: Issues for Parliamentarians. The report highlighted discrepancies ($15B) between Budget 2022 and the Departmental Plan.
  • The $15B in military spending outlined in Budget 2022 does not appear in the Departmental Plan, as the latter only reflects spending that has been approved by Treasury Board and for which parliamentary approval has been requested.
  • The difference is attributable to recently announced policy measures, including those in Budget 2022, and funding for previously approved capital projects that still require Treasury Board approval and inclusion in the Estimates.
• Budget 2022 Investments in Defence:
  • 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:
    • $6.1B over five years, starting in 2022-23, with $1.3B in remaining amortization, and $1.4B 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.
    • $100.5M over six years, starting in 2021-22, with $1.7M in remaining amortization, and $16.8M 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.
    • $144.3M over five years, starting in 2022-23, and $31.6M ongoing to address shortcomings in meeting specific healthcare needs of, and support fitness improvements for, women and gender-diverse members.
    • $9.5M 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.
• 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.

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NATO Funding

Key Facts

Details

• NATO Military Budget:
  • A common-funded program that finances the operating and maintenance costs of the NATO military structure and activities, including deployed operations and missions.
  • It is distinct and separate from other designated NATO activities and on-going operations.
• Budget 2021:
  • Through Budget 2021, the Government announced $847M 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.
• Budget 2022:
  • To reinforce Canada’s national defence, announcements in Budget 2022 will provide a total of more than $8B (on a cash basis) in new funding over five years—on top of planned increases associated with Strong, Secure, Engaged, which will:
    • Strengthen Canada’s contributions to our 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.
  • To increase the capabilities of the Canadian Armed Forces, Budget 2022 proposes to provide $6.1B on an accrual basis ($7.4B cash) over five years, starting in 2022-23, in order to meet our defence priorities, including:
    • Ensuring our continental defences;
    • Fulfilling commitments to our allies; and,
    • Investing in equipment and technology to immediately increase the capabilities of the Canadian Armed Forces.
• NATO Security Investment Program:
  • A common-funded program that finances the capital costs for communications and information systems, installations and facilities to support the NATO military structure and activities, including deployed operations and missions.
  • It is distinct and separate from other designated NATO activities and on-going operations.
  • Canada’s share of NATO’s Security Investment Program (NSIP) remains unchanged at 6.9% in 2022.
• NATO Centre of Excellence on Climate and Security:
  • At the latest NATO Summit in Madrid in June 2022, Canada announced that Montréal will be the host city for the NATO Climate Change and Security Centre of Excellence.
  • The Centre of Excellence will facilitate the exchange of expertise among Allies, build capacity to address the security implications of climate change, and help advance ongoing efforts to reduce the climate impact of military activities.
• Defence Innovation Accelerator for the North Atlantic (DIANA):
  • At the latest NATO Summit in Madrid, the Prime Minister announced Canada’s intention to host NATO’s North American Regional Office of the Defence Innovation Accelerator for the North Atlantic (DIANA).
  • 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.

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