Defence minister says ‘we’re good’ to meet 2% NATO spending target by March


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Canada’s defence minister assured parliamentarians on Thursday that the federal government is well on its way to meeting NATO’s old, politically charged spending target by next spring.

David McGuinty’s confidence that the country will meet the benchmark of spending two per cent of gross domestic product on the military was met with skepticism from the Opposition Conservatives who noted the Department of National Defence’s long history of having trouble spending all of its annual appropriation.

But separate from the minister’s remarks, a clear example of how the government will get there presented itself in public.

The U.S. Defense Security Cooperation Agency announced its approval of a $3.6-billion munitions sale to Canada on Thursday. The planned purchase involves thousands of bombs — including smart munitions — that can be dropped by CF-18s and eventually F-35s or F-39 Gripens.

The purchase fills out the Royal Canadian Air Force’s stock of aerial munitions and is a stark reminder of how dependent Canada is on the United States for weapons.  

Late last spring, Prime Minister Mark Carney announced Canada would meet the old NATO target by the end of the fiscal year and injected an additional $9.3 billion into the defence budget. The goal was announced just as the Western military alliance agreed to raise the threshold to five percent of GDP (3.5 per cent directly on the military and 1.5 per cent on defence infrastructure).

Canada’s total planned defence spending for the current fiscal year is around $63 billion. The latest federal budget did not spell out what it is expected to be next year. 

The new investment in the current fiscal year was described as foundational and is meant to — among other things — rebuild the stocks of weapons and munitions depleted through years of underfunding and donations to Ukraine.

The question of whether the department could spend all of the extra cash has loomed over McGuinty.

“We’re good,” McGuinty said in answer to a question from Conservative defence critic James Bezan. “We’re on this and watching it like a hawk, and you’re right to raise it. And we’re making sure that we’re gonna be delivering on time by March 31.”

A good chunk of the extra funding for this year was plowed into higher wages for members of the military.

Between 2020 and 2023, National Defence was unable to spend approximately $5.37 billion — some of which was reprofiled to be spent in future years, while another portion was lapsed and returned to the federal treasury. 

Capital spending — the money for new equipment — has been particularly hard to do. The Parliamentary Budget Office, in a recent report, said that $18.7 billion in equipment spending planned under the Liberal government’s 2017 defence policy did not happen. 

There is a political imperative to meet the two per cent target. Canada has long faced pressure from allies, particularly the United States, to hit the benchmark, first agreed to at the 2014 NATO summit in Wales.



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