Philippe Lagassé: Sure, let’s spend more on defence, but what’s our long-term plan?
Calls to increase Canada's defence spending tend to ignore the long-term trends and the structural conditions that make a larger commitment hard to sustain.
By: Philippe Lagassé
Canadian defence spending is back in the news, thanks to an open letter urging the government to spend two per cent of GDP on the military and a leaked document suggesting Canada won’t hit that NATO target. Like ending the monarchy, defence spending is one of those issues that gets lots of attention once or twice a year, only to fade away before any serious discussion takes place. It’s unlikely that this time will be any different.
Our defence spending debate has been pretty much the same for the past 50 years. Canada invested heavily in the military during the world wars. We also spent a lot during the 1950-1953 Korean War and maintained a strong force to help contain the Soviet Union in the years that followed. Although the world wars and the 1950s are still held up at the benchmark we should seek to return to, it’s important to recognize that these were exceptional times. Canada spent little on the military during in interwar period and defence spending began a steady decline in the late 1950s. This has led to consistent calls for greater defence spending since 1970s, yet military expenditures per capita and as a portion of federal spending have stayed relatively level since that time. We’ve seen recapitalizations, such as the 1975 Defence Structure Review and the current one that’s underway, but they have been largely about modernizing the military, not expanding it. Our low defence spending isn’t a recent failing or the fault of any one party or government; it’s our standard practice.
Russia’s invasion of Ukraine and the threat posed by China could be another exceptional moment that spurs far more investment in defence. Many of our European allies are strengthening their militaries, as are the Australians, as seen with the AUKUS security pact under which they’ll acquire nuclear-powered submarines. Our allies are expecting us to spend more and the pressure on the government seems more palpable.
Even if the government wanted to greatly increase defence spending, though, it would have trouble spending that money effectively in the short term. While more money is needed over the long term, the Department of National Defence (DND) and Canadian Armed Forces (CAF) have to first build up their capacity to spend a much larger budget. As they do so, however, our historical tendency to reduce defence expenditures after pivotal moments should always be kept in mind.
The DND and CAF are already straining to implement the capital equipment and infrastructure programs that were announced in the 2017 defence policy, Strong, Secure, Engaged. This reflects the fact that department’s capacity to manage procurements has to be built back up after decades of anemic capital spending. There aren’t enough people to move the programs that are currently planned, let alone new ones that could be added. Additional money could be funneled to existing projects, but that wouldn’t be enough to cause an increase to two per cent of GDP in the coming years. The capabilities Canada is currently buying will probably be far more expensive to maintain in the future than the government realizes, which strongly suggests that we do need to gradually get to that number, but this reinforces the need for caution and for managing expectations. If ministers insist that new money be attached to still more new capabilities, DND/CAF will not only have trouble acquiring them, but will be unable to afford them.
One could argue that DND/CAF could get around its capacity challenges by simply buying more equipment “off the shelf.” Instead of getting more people to tackle complex procurements and infrastructure projects, the defence department should focus on simpler acquisitions that require less management. It is important to note, though, that “off the shelf” procurements aren’t an obvious solution either — DND and the CAF don’t specify requirements for the hell of it. Many project requirements reflect the need to integrate new capabilities into the existing force, which is no small feat when mixing new and old technologies and operating from installations across a massive country. Projects that gravitate toward “off the shelf” solutions, moreover, can be challenged by competitors who contend that they can develop a new capability that better meets Canada’s needs. Bombardier’s response to the government’s plan to buy Boeing’s P-8 Poseidon aircraft to fulfil the Canadian Multi-mission Aircraft (CMMA) project is a recent example.
Canada also tends to favour platforms that can perform various missions, which further complicates “off the shelf” procurements, since the equipment sitting on the shelf may not do everything the CAF needs it to do. Unless we want the CAF to be less capable, the way to address this issue is to acquire more platforms that do specific things. The problem is that the CAF would need more people to acquire, operate, and maintain these additional fleets, still more money to sustain this extra equipment, and yet more infrastructure to store it. This approach promises to exacerbate the very problems it’s supposed to solve.
The people side of this equation deserves particular attention. The CAF isn’t able to recruit and retain enough personnel as it is. Increased defence spending might help address this issue if salaries and top-ups for specialized positions were augmented. Yet personnel costs tend to hover around 50 per cent of the defence budget; if that percentage rises, it could further strain spending on operations and maintenance, capital equipment, and infrastructure. There’s a difficult balance to be found between spending more to recruit and retain people, while having sufficient funds to deploy them, equip them, and have them work in safe, modern facilities. Equally important, it’s not clear that money will convince enough Canadians to join the CAF and stay in uniform for longer periods. The private sector and wider public sector are looking for the same types of people the CAF needs, and they demand far less of their employees than the military. Although higher salaries may be part of the solution, the profession of arms has to appeal to Canadians on a more fundamental level to address the CAF’s recruitment and retention challenges.
If we accept that increased defence spending should occur gradually over the long-term, we then need to return to where we started: the tendency of Canadian military expenditures to gradually decline over time. Simply put, it only makes sense to spend far more on defence if we have a plan to sustain a far more capable force. Right now, it’s difficult to believe that Canada would keep defence spending at two per cent of GDP if it ever gets there. At some point in the future, a Canadian government will likely decide to tackle the federal deficit and reduce the debt. If or when that happens, DND/CAF will have a big red target on their backs, since the defence budget is the largest source of discretionary spending at the federal level.
Unless Canadians are ready to accept higher taxes or significant reductions in other areas of federal spending, it’s difficult to see how the deficit and debt will be tamed without defence taking a major hit. That’s the serious discussion we don’t have when calls for increased defence spending make the news once or twice a year, and why the issue will probably fade away yet again.
Philippe Lagassé is associate professor and Barton Chair at the Norman Paterson School of International Affairs, Carleton University.
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