The federal Liberals will boost the budget for the Canadian military by roughly $8 billion on top of billions in already scheduled increases, and launch a review of the country’s defence policy.
But even with that increase, Canada will not hit the two-per cent NATO spending target.
The spending boost comes as Deputy Prime Minister and Finance Minister Chrystia Freeland has repeatedly warned Russia’s invasion of Ukraine threatens the very foundations of the global order underlying Canada’s economy and foreign policy since the end of the Second World War.
“Uncertainty and turbulence” will be hallmarks of the coming years, one senior government official told journalists on Thursday morning, and the assessments made in 2017 when the Liberals last overhauled Canada’s defence policy are changing.
“Recent events require the government to reassess Canada’s role, priorities, and needs in the face of a changing world,” Freeland noted in her second budget.
The $8 billion in new spending will come over five years.
It comes in addition to increases promised in 2017 that were set to see Canada’s defence budget grow from $18.9 billion in 2016/2017 to $32.7 billion by 2026/2027.
The additional $8 billion will not bring Canada up to meet the target for military spending laid out by NATO members back in 2014. Under that pledge, members of the military alliance vowed to boost defence spending to represent two per cent of their GDPs.
Canada’s spending currently stands at 1.39 per cent of GDP.
The $8-billion increase will bring that to 1.5 per cent within five years.
Strong, Secure, Engaged laid out a vision for the role the Canadian Forces would play over the next two decades that focused on peacekeeping and the creation of a new cyber force.
But the world has changed profoundly since 2017 — most acutely in the weeks since Feb. 24, when Russia invaded Ukraine in a bloody, unprovoked campaign of aggression.
Scores are dead as a result, and the scale of the Russian butchery of Ukrainian civilians has horrified the world and sparked the most direct challenge to the basic tenets of international law since the Second World War.
Countries like Switzerland have abandoned traditional policy positions of neutrality in the face of the massacre of Ukrainians by Russia. Even Germany — where the process of armament has for decades been politically and culturally verboten — is launching a massive campaign to boost defence spending and equip their armed forces in the face of Russian aggression in Europe.
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A senior government official said the defence policy review will be broad, looking at both the sharpening threats to European democracies as well as the risks posed by countries like China in other regions of the world.
In a statement issued Thursday, the head of the Canadian Association of Defence and Security Industries (CADSI) said the organization is “encouraged” by the investments announced in the budget.
“Critically, we want to see the same level of industry engagement that we saw when the government was drafting Strong Secure Engaged, said Christyn Cianfarani, president and CEO of the defence industry group.
“Turning ambition into reality is always the hard part. Canada’s defence industry has worked closely with government in response to the pandemic, and we re-affirmed that partnership as Canada worked to send military supplies and support to the people of Ukraine. We need to move forward in that same spirit of collaboration if the agenda set out in today’s budget is going to succeed.”
Senior defence officials have warned in recent weeks that the Arctic is at an “inflection” point, posing key challenges for countries like Canada with longstanding claims and sovereignty.
The budget recommitted $252.2 million in previously announced funding for Arctic defence capabilities and for modernizing NORAD, which is Canada’s continental defence pact with the U.S., and boosting cooperation with NATO.
The $8 billion in new spending includes promises to spend $100.5 million over six years on overhauling the culture of the Canadian Forces, which is under national scrutiny following reporting by Global News last year into the military sexual misconduct crisis.
That includes modernizing the military justice system, bringing into force the Declaration of Victims Rights, consulting on how best to change the culture, and building out restorative services including dispute resolution and leadership coaching.
In addition, the budget sets aside $500 million in additional military aid for Ukraine this year.
As well, the Communications Security Establishment — which works with the military on conducting cyber operations — will get hundreds of millions of dollars more to “enhance CSE’s abilities to launch cyber operations to prevent and defend against cyber attacks.”
That will also include strengthening the responses to cyber attacks on critical infrastructure.
Both are growing threats amid Russia’s invasion of Ukraine, which has included a heavy component of cyber operations targeting Ukrainian critical infrastructure and government institutions.
But when it comes to how new money will be spent on expanding Canada’s contributions to NATO and NORAD, a senior government official said those details still need to be worked out.
That official said the goal of the extra funding is to keep Canada involved in the conversations with both alliances “without Canada putting all our cards on the table.”
Maj.-Gen. Michael Wright, the Canadian military’s defence intelligence chief, warned last month that while the risks of a Russian incursion into the Arctic appear low, the invasion of Ukraine has “thrown into question” longstanding assertions by Russian President Vladimir Putin about wanting a peaceful zone in the Arctic.
Russia has been building up its military presence in its Arctic territories over recent years, raising questions about the intent behind the modernizing and re-militarization of former Cold War sites.
Kevin Hamilton, director-general for international security policy with Global Affairs Canada, noted there is potential for “co-operation” between Russia and China — which describes itself as a “near-Arctic state” — in the far north.
“China may indeed seek to leverage a lot of the new infrastructure the Russians have built in their High Arctic,” said Hamilton. “So we see the two countries as distinct and having distinct interests, but there are areas of convergence that we’re concerned about.”
He added modernizing NORAD and enhancing Canada’s surveillance capabilities are measures that “we hope will put us in better stead,” as Wright warned that Canada and other Arctic allies “need to keep up with them” on investments in the region.
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