Canada goes on the offensive with new defence funding

After catching flack for not spending enough on defence, the feds fished around their proverbial couch cushions and came up with a hefty chunk of change. 

What happened: As part of Canada's first major defence policy update since 2017, the Canadian Armed Forces (CAF) will receive an additional $8.1 billion in federal funding over the next five years. The policy’s two high-priority areas of focus are cybersecurity and Arctic defence. 

  • Meanwhile, as Russia grows increasingly aggressive and climate change opens up northern waterways, the Arctic has been flagged as a newly important risk area.

  • The new policy is slated to last for 20 years (with reviews happening every four years) and, over that time, is projected to result in $73 billion in new spending.

Why it matters: Canada is now poised to spend 1.76% of its GDP on defence by 2029-30. While still shy of the 2% target it’s obligated to hit as a NATO member, this is a sign that it could reach that target one day — something that, supposedly, was never going to happen.

  • Skimpy defence spending has hurt Canada’s ties with security partners. An effort to at least try to reach NATO’s target could help Canada get back in their good books.
  • NATO Secretary-General Jens Stoltenberg called the new plan a “step in the right direction,” while David Cohen, the U.S. ambassador to Canada, called it “real progress.”

Zoom out: To justify spending any more on defence, the CAF needs to get its numbers up. The military was short ~15,000 active duty personnel as of 2023 and is, generally speaking, unprepared. To fill these gaps, Defence Minister Bill Blair wants to modernize the recruitment process.—QH