Canada’s Summer Defence Outlook

Military expenditures are a hot but hazy topic

It’s hot in Ottawa today. After a long, cold spring, summer has finally arrived and it’s been intense. This applies to Canadian defence, too. During the winter and early spring, it looked like Canada was sticking to a 2030 timeline to reach the NATO spending target of 2% of gross domestic product on defence. Earlier this month, Prime Minister Carney surprised us with a pledge to reach the 2% target within 12-18 months. And earlier this week, on the eve of the NATO summit, Carney signed Canada onto the ReArm Europe initiative. Defence is therefore one of the government’s hot files right now.

Hot summers tend to make things a bit hazy, though.

As I noted in my last post, the facts and figures surrounding the 2% increase are hard to pin down. Even after going through the technical briefing, I still can’t quite figure out where the $14 billion from other government departments is coming from and why it wasn’t included in our NATO defence expenditures before. The government is pouring an additional $9 billion (annually) into various buckets, but it’s still too early to say how exactly it’ll be spent and on what. This may reflect the government’s intention to release a new national security strategy and updated defence policy. DND is also supposed to publish a defence industrial strategy. There may be additional details in those documents. Frustratingly, we may be left guessing about the specifics until they’re released.

Military pay is especially vague these days. When it was first announced, the pay increase sounded like there’d be a 20% across-the-board salary bump for the entire CAF. Now it looks like the government is considering a tailored approach. There are several reasons for this shift, including the decision to link CAF salaries to equivalent ranks and roles in the public service. But, man, it’s bad optics and potentially bad faith.

I get that many in Ottawa will be up in arms about, say, paying a military lawyer more than a Department of Justice lawyer. The difference is that we aren’t clamouring to keep people from leaving the public service, whereas we’re begging people to stay in uniform. This is one of those cases where a blunt, universal approach would be the simplest and best option. The more the government hums and haws about salary increases, the more annoyed and disillusioned many CAF members will be. That’s really not ideal when you’re trying to convince people to stay on.

The speed at which the Carney government made its recent defence announcement also makes me wonder about the degree of alignment between PMO/PCO, the defence minister, and various parts of DND/CAF. Getting to the 2% target within a very short timeframe requires these actors to be more or less on the same wavelength.

The Chief of the Defence Staff’s recent comments about the F-35 suggest that Canada will be sticking with the original plan to buy 88 of these planes. The real question is whether Canada’s F-35s will be complemented by a second, European fighter. Whatever the outcome, let’s hope this question doesn’t eclipse other capability discussions, particularly around emerging technologies and other areas where Canadian industry and new partnerships could thrive.

Indeed, I hope DND/CAF are making serious efforts to align their planning and priorities around what Carney and his advisors are focused on. Some parts of the defence establishment are better at this than others. The Royal Canadian Navy, for instance, is clearly willing to be flexible and open-minded about what it needs to accept to keep the submarine replacement moving forward. Other parts of the organization are more rigid. Many within the CAF won’t be keen on a Canadian AEW plane, for instance, which could lead to tensions with the Carney team. Similarly, senior military leaders will understandably be looking to acquire major platforms, such as new tanks, but that may distract from necessary investments in uncrewed systems, digital capabilities, dual-use technologies, and other areas where Canadian start-ups and innovators could be unleashed.

Speaking of Canadian industry, they need to better align with the government’s ambitions, too. When I walked the floor at CANSEC a few weeks ago, I asked several companies what ideas and projects they could quickly present and deliver to the government if asked. Too many of them stumbled or mumbled when answering. That’s not too surprising; industry usually waits for government to signal a need or announce a new project before they start thinking about potential solutions and bids. Still, industry may be missing an opportunity here. If the Carney government is serious about spending a lot more money, a lot faster, and with a preference for Canadian products, industry needs to have good ideas at the ready.

None of these observations are meant to take away from the defence momentum the Carney government has created. We just want to be clear-headed once the haze of the hot summer gives way to the crisp coolness of the fall.