In a significant pivot for Canadian military policy, Prime Minister Mark Carney has announced an ambitious plan to elevate defence spending to 3.5 per cent of GDP within the next decade. This move, which aims to strengthen Canada’s military capabilities amidst evolving global threats, is projected to add a staggering $63 billion to the national deficit over the next ten years, according to the latest report from the Parliamentary Budget Officer.
A New Military Commitment
During the NATO leaders summit held in 2025, Prime Minister Carney’s commitment to bolster defence spending marks the most considerable increase in over 70 years. The government’s current defence budget stands at approximately $63 billion, accounting for around 2 per cent of Canada’s annual economic output. The Parliamentary Budget Officer, Jason Jacques, has indicated that achieving the proposed defence expenditure target will necessitate an additional $33.5 billion each year up until 2035-36.
This increase reflects a growing recognition of the need for enhanced military readiness in a world marked by geopolitical tensions and security challenges.
Infrastructure and Broader Security Investments
In addition to the core defence spending, Mr. Carney has pledged an additional allocation equivalent to 1.5 per cent of GDP for dual-use infrastructure projects. This investment will encompass not only military facilities but also civilian applications, such as bridges, ports, roads, and vital cybersecurity initiatives aimed at safeguarding energy pipelines. The government asserts that existing budgetary frameworks will accommodate this infrastructure investment, bringing the overall military and security spending to a total of 5 per cent of GDP.
However, critics have raised concerns over the lack of a detailed financial roadmap outlining how the government intends to reach this ambitious target. When the Parliamentary Budget Office sought clarity from the Department of National Defence last July, it received no specific year-by-year plan. Instead, officials referenced NATO estimates, suggesting that 3.5 per cent of GDP might translate to roughly $150 billion in spending by 2035, contingent on future economic conditions.
The Need for a Comprehensive Strategy
The substantial commitments to military spending raise pressing questions about the long-term vision for the Canadian Armed Forces. As the government prepares to allocate unprecedented amounts toward defence, many are calling for a strategic framework that clearly delineates how these funds will be utilised to enhance military readiness and capability.
The absence of a clear plan has left many in the defence community and beyond uncertain about how these investments will translate into tangible improvements in national security. As Canada seeks to modernise its military force, it is crucial for policymakers to provide a coherent strategy to ensure that the increased funding effectively addresses contemporary security challenges.
Why it Matters
The implications of Canada’s new defence spending strategy extend far beyond fiscal numbers. As global security dynamics shift, this unprecedented commitment signals a decisive move towards strengthening Canada’s military posture. Yet, without a comprehensive plan detailing how the government intends to allocate these resources, there remains a risk of misalignment between funding and operational effectiveness. The success of this initiative will ultimately depend on the government’s ability to translate financial commitments into strategic military enhancements that ensure Canada’s readiness for the challenges of the future.
