A chinook helicopter lands at an air strip in Inuvik, Northwest Territories, in March.COLE BURSTON/AFP/Getty Images
David Perry is the president and CEO of the Canadian Global Affairs Institute.
Since becoming Prime Minister, Mark Carney has made defence a priority in a way Canada has not seen in decades. And while the overall reactions to his first federal budget have been mixed as to whether it was as game-changing as the government had promised, it is genuinely transformational in its support for Canada’s military.
At the recent NATO summit in The Hague, allies committed to a revised spending metric – going from allocating 2 per cent of gross domestic product (GDP) to defence to spending 3.5 per cent on “core defence” – while making an overall commitment of 5 per cent of GDP, including other investments in resilience, infrastructure and other measures, by 2035.
Canada had agreed to the original 2-per-cent alliance investment pledge at the 2014 summit in Wales; ever since, successive governments have failed to follow through. It was only after the 2025 election that the Canadian government gave the Department of National Defence and the Canadian Armed Forces the cash they need to live up to the commitment Canada made to its allies 11 years ago.
This budget unambiguously commits to delivering on this path of increased defence investment, stating that “Canada will invest 3.5 per cent of GDP by 2035 in core military needs,” and that we are on a path to meeting the total commitment in a decade’s time, starting with an extra $9-billion in funding this fiscal year that was announced in June.
This $9-billion injection to bring Canadian defence expenditures to 2 per cent of GDP is part of the budget’s second transformational commitment to defence, which promises a total injection of $81.8-billion on an actual-dollars basis for a range of defence investments over the next five years.
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The funds are spread out over several areas spanning the breadth of the defence portfolio: $20.4-billion for personnel; $19-billion for repairing and sustaining capabilities and defence infrastructure; $10.9-billion for upgrades to digital infrastructure; $17.9-billion for new equipment and ammunition; $6.6-billion to implement the Defence Industrial Strategy; $6.2-billion over five years to expand Canada’s defence partnerships; and $805-million for the Canadian Coast Guard, CSIS and Public Services and Procurement Canada for complementary initiatives.
To put this increase in perspective, the five-year funding injection for defence outlined in Budget 2025 represents about 80 per cent of the $103-billion commitment made in the last defence policy update by the Trudeau government, Our North, Strong and Free – but that document’s spending horizon spanned 20 years, not five.
In fact, that policy update outlined a spending increase of just $10.5-billion over the first five years – one-eighth as much money for the military as the 2025 budget provides. Even if future governments only committed to maintaining spending at the new level reflected over the next five years – and this budget clearly commits to increasing it, substantially – this would add more than $300-billion to the defence coffers over the next two decades.
That said, despite the consequential increases to defence spending outlined, the budget is curiously missing some key details about where those funds will go. There is no breakdown provided of total forecasted spending year by year, something that was presented in the budget a year-and-a-half ago. Nor was there an actual outline of the path to spending 3.5 per cent on core defence by 2035 on a yearly basis.
Similarly, the details about where the $81.8-billion dollars will go are both very high-level, and nearly word-for-word the same description used back in June to indicate where the $9-billion portion would be directed. The addition of another $72.8-billion beginning in April, 2026, will presumably allow a few more initiatives to move forward, but those were not presented in the budget text or made available to frustrated journalists in the budget-day media lockup.
As Canadians await more details on how the Carney government plans to direct its generational cash infusion, those details must also include clarity on exactly how our defence relationship with the United States will or will not change. The defence direction should be guided by a new national security strategy and foreign policy vision.
The funding of Canada’s defence has been transformed with the 2025 federal budget; now, we need clarity on how that funding will transform the Canadian Armed Forces.