Canada moves to 2% GDP end of FY25/26 - PMMC

[Kirkhill]

I think it's far too early to be making declarations like that.

Things may have shifted for now, but Canadians are quite adept at ignoring the dangers of the world. We shouldn't pretend past behaviours are not an indicator of future ones.

Acting like this shift is permeant right now comes across as similar to those who declared the handshake dead in the peak of COVID. It went out of fashion for a while, but it's back to being the norm again.

Some years back I made the comment that managing defence in Canada was much like fly fishing for 20 lb fish on a 5 lb test. You never know when the line is going to break and you can't pull. You just have to let the fish run and pull in the slack when you can.

Now is one of those times to reel in hard and fast. Get what you can while it is on offer.

 

[ytz]

Its polling like this that scares me. And politicians will sacrifice anything to stay in power.

I don't see defence on there anywhere. Maybe the threat of China and Russia, 6% ? Even DJT has dropped to 5th place.

Realistic, no?

On a day to day basis I worry more about several of those top issues than China and Russia. And even from those nations, I worry more about information warfare, infrastructure attacks (cyber and underwater) than them landing troops on Canadian soil. Economic warfare with China is a much higher concern than a Chinese missile on the horizon.

It's not just Canadians thinking like this. Here's Gallup polling about issues that Americans are most concerned with in 2025. You won't see Russia and China high on there either.:

Worry About U.S. Economy, Healthcare, Social Security Surges

Majorities of Americans are highly concerned about financial issues, including the economy, healthcare costs, inflation and the federal budget deficit.

news.gallup.com

So yeah, we'll get to 2% mostly because defence is becoming a domestic stimulus program. I wouldn't expect much more.

 

[CBH99]

My apologies if this link was already posted, I realize it is from a few weeks ago.

 

[Jarnhamar]

My apologies if this link was already posted, I realize it is from a few weeks ago.

"We believe the CAF has the latest in technology"

 

[Halifax Tar]

Realistic, no?

On a day to day basis I worry more about several of those top issues than China and Russia. And even from those nations, I worry more about information warfare, infrastructure attacks (cyber and underwater) than them landing troops on Canadian soil. Economic warfare with China is a much higher concern than a Chinese missile on the horizon.

It's not just Canadians thinking like this. Here's Gallup polling about issues that Americans are most concerned with in 2025. You won't see Russia and China high on there either.:

Worry About U.S. Economy, Healthcare, Social Security Surges

Majorities of Americans are highly concerned about financial issues, including the economy, healthcare costs, inflation and the federal budget deficit.

news.gallup.com

So yeah, we'll get to 2% mostly because defence is becoming a domestic stimulus program. I wouldn't expect much more.

I appreciate your optimism.

 

[Maxman1]

I was there when the requirements were being written. All of that was done during the Harper years. Even circulation of draft RFPs. Only the competition itself was held in 2016. Do you really want to argue that new governments should simply restart procurements from scratch when elected?

I was referring to the selection process and lowering the testing standards to allow a noncompliant bid to win, just like the LSVW and CF-5.

 

[RangerRay]

The big difference I see is that back in the 80’s when the Mulroney government put out the White Paper, there were huge “peace demonstrations” (funded by Moscow) in every major city and critical editorials in most major news outlets. Opposition to the whiff of increased defence spending was real, which is why much of that White Paper disappeared. Now, I am not seeing anywhere near that level of public opposition, save for the odd Tankie artsy prof at some backwater university. Most editorials I’ve seen the last few years (even before Trump 2.0) called for more defence spending.

I am definitely sensing a change.

 

[Czech_pivo]

Some years back I made the comment that managing defence in Canada was much like fly fishing for 20 lb fish on a 5 lb test. You never know when the line is going to break and you can't pull. You just have to let the fish run and pull in the slack when you can.

Now is one of those times to reel in hard and fast. Get what you can while it is on offer.

Like 12 subs

 

[dapaterson]

Like 12 subs

To replace the twelve SSN Perrin Beatty delivered?

 

[ytz]

I was referring to the selection process and lowering the testing standards to allow a noncompliant bid to win, just like the LSVW and CF-5.

All that happened long (years) before the competition. When writing the SOR, 4 engine requirement was dropped, commonality was removed from consideration in bids, and the requirement to meet speed and range and payload simultaneously was removed as mandatory.

The government of the day was getting a ton of flack from industry for all the IORs. They decided, they weren't going to burn more political capital on this project. Ergo, the decision was to reduce requirements till the contest was competitive enough to get multiple bids, which Industry Canada could use to leverage maximum industrial benefits from bidders. That was a political choice.

And well, I guess continuity from the following government was a political choice too. Albeit fairly normal, for most procurements.

 

[ytz]

The big difference I see is that back in the 80’s when the Mulroney government put out the White Paper, there were huge “peace demonstrations” (funded by Moscow) in every major city and critical editorials in most major news outlets. Opposition to the whiff of increased defence spending was real, which is why much of that White Paper disappeared. Now, I am not seeing anywhere near that level of public opposition, save for the odd Tankie artsy prof at some backwater university. Most editorials I’ve seen the last few years (even before Trump 2.0) called for more defence spending.

I am definitely sensing a change.

Yeah. But what happens when the budgets come out and we have $50b deficits? Balanced budgets, more social spending, more defence spending. Pick two. The next government will have the same choices too.

This is why I think 2% is possible. More is a bridge too far. Up to 2%, there's ways to spend a lot of that in Canada. The more we spend that leaves the country, the harder it is to support.

 

[Czech_pivo]

To replace the twelve SSN Perrin Beatty delivered?

Wonder what the RCN would have been like these last 25-30yrs if that had happened.

 

[Czech_pivo]

Interesting piece of news.

At first glance I don't have an issue with this. I mean, come out with a budget first week of November and then turn around and come out with another at the beginning of April, crazy!

Moving it to the fall, maybe the end of Oct, aligns it will the fiscal year end of all the major banks in Canada, so the timing is not out of the ordinary.

Carney to Permanently Shift Canada’s Budgets to Fall

Prime Minister Mark Carney plans to change when Canada releases major fiscal documents, moving the country’s federal budget to the fall on an ongoing basis.

www.bloomberg.com

 

[lenaitch]

I would also be a little reticent to criticize the Canadian public too much. Maslow's hierarchy. They know what they need. And in a country with a housing crisis, healthcare shortage, cost of living crisis, etc, to argue that the priority should be high end toys for a fight in Europe or Indo-Pac is always going to be a tough sell.

Those are fairly recent pressures, though. The Canadian tradition of military under funding is decades long. It could be argued that the Canadian public, through its government, has prioritized what it wanted more than what it needed.

 

[dapaterson]

Wonder what the RCN would have been like these last 25-30yrs if that had happened.

Three nuclear meltdowns, seven accidental groundings, and one conning tower crushed under ice when a CO ignored the conditions.

 

[brihard]

Interesting piece of news.

At first glance I don't have an issue with this. I mean, come out with a budget first week of November and then turn around and come out with another at the beginning of April, crazy!

Moving it to the fall, maybe the end of Oct, aligns it will the fiscal year end of all the major banks in Canada, so the timing is not out of the ordinary.

Carney to Permanently Shift Canada’s Budgets to Fall

Prime Minister Mark Carney plans to change when Canada releases major fiscal documents, moving the country’s federal budget to the fall on an ongoing basis.

www.bloomberg.com

Non-paywalled version of the article: https://archive.is/1WQBN

Makes sense to me. Get a budget out late in the calendar year, with time for departments and agencies to digest it before the start of the federal fiscal in April. The point about getting a budget out some months before construction season seems reasonable too.

If we’re to have a budget once a year, then publishing it when it makes more sense for planning purposes doesn’t seem to me to be a bad thing.

 

[Jarnhamar]

If we’re to have a budget once a year, then publishing it when it makes more sense for planning purposes doesn’t seem to me to be a bad thing.

This is where I hope Carneys business banker experience comes out. Figured out what makes sence and pull the trigger on it.

 

[FJAG]

What worries me, is that this pivot is just a reaction to DJT and his presidency. And if DJT loses the midterms and then crashes in the next election every things will go back to 2023.

The threats will remain the same. I think post-Trump you are still not going to see the US returning as policeman for the world. I think their retrenchment is settling in. They'll continue to push the envelope where their own self-interest is threatened either in fact or perception.

Those are fairly recent pressures, though. The Canadian tradition of military under funding is decades long. It could be argued that the Canadian public, through its government, has prioritized what it wanted more than what it needed.

Military underfunding and an aversion to things military goes back to the 1960s. Until then we spent robustly on the military and went so far as to have nuclear weapons both in Canada and in Germany.

Most folks that didn't live during those days will downplay the influence that the Vietnam War had on Canada. Canada's identity as "not US" grew year by year. By the time that Trudeau the First made it to the throne, we'd pretty much convinced ourselves that we hated war and loved our new mantle of peacekeepers to the world. Everything that followed was a holding action to try to preserve a little bit of war fighting capability out of the meagre resources the government allocated.

 

[ytz]

Those are fairly recent pressures, though. The Canadian tradition of military under funding is decades long. It could be argued that the Canadian public, through its government, has prioritized what it wanted more than what it needed.

They aren't fairly recent pressures. Wages and cost of living have been diverging for a while now. Worse more recently. But the trend is long running. The housing crisis has been easily going for two decades. And again, exploded post COVID. How many people in this country don't have a family physician or can't find childcare?

I'll also go back to what I said earlier. What's the actual need? Because if the requirement is strictly defence of Canada, that can be done for less than 2% and an even smaller full time army. Anything above and beyond derives from the obligations we understand and perceive for our participation on the world stage. And to the average voter, that is quite subjective.

Some here want divisions in Europe. Once you take the cost of recruiting, equipping, training and sustaining that force, we're talking north of $10B per year (going by a rough wag from this US CBO doc says various brigades cost and looking at conversion and inflation). If we want balanced budgets at the same time, how are we going to convince voters that this is more important than say universal dental care or say reducing the lowest income tax bracket by 1-2%?

I don't have the answers. But I find that military folks (myself included at times) love to shit on the taxpayers who pay our salaries for not giving us more toys to play with, while failing to articulate in concrete terms what the threat is and why they should fund us more.

The $10-15B the government is going to spend every year going forward, to get to 2%, is a ton of money. We had better start working on explaining to the tax paying and voting public why we need this over everything else, including some very real day to day shortfalls they have.

I will admit to being lucky. I'm on a space project that directly shows benefit to homeland defence. My job isn't that hard. But if you want to sell the government on why the CA should have 300 MBTs, that's admittedly harder to justify.

 

[KevinB]

Was it their call, or a government directive? Plus the Chinooks were an RCAF asset, the Army wouldn't be able to sell those off if it wanted to.

So Helicopters in Canada are a bit of a weird issue. The Chinooks basically exist to serve the Army for movement support, the RCAF budget was tightened, and the choice was given to the Army; either fund the capability that the Army was demanding/desiring, or to lose it.
So the Army opted to save the Reg Force 9 Inf Bn's and 3 Armoured, Artillery and Engineer Reg'ts (etc) and lose the Hooks (having just lost the CAR, as well as Reg Force Armour, Artillery and Engineer and CS units with the closure of 4CMBG the Regimental Mafia's went into action, as after all no Regiments flew the Hooks... To me, it smacks of the shortsightedness that the CA has long had, the other services are much better in their "business planning".

No argument there, but three years should be more than enough time to order replacements. Same with the Chinook that crashed two years ago.

Yes, but I would not blame the current government for that one.

The LSVW was also their fault (although it was my understanding the Griffin was picked by the Chretien government, because it was built in Quebec).

Nope that was Marcel Masse, under the Brian Mulroney Gov, Kim Campbell succeeded him as the Minister of Defence, and did the whole LSVW fiasco -- who says pork barreling is only an American thing....

Like I said, both sides have a poor record, although the Kingfisher falls on the current government.

Again, not the current government, a Liberal government yes, but not the same government.