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The Defence Budget [superthread]

Here's the budget page, and I've attached the defence budget info (extracted from the 400+ page major document) - defence section:
.....Restraining Growth in National Defence Spending
In recent years, the Government has made major, necessary investments in
the country’s military capabilities in support of the Canada First Defence
Strategy, the Government’s long-term vision for the Canadian Forces. The
Canada First Defence Strategy is a long-term commitment to modernize
the Canadian Forces. The strategy sets out key objectives of growing the
Forces, recapitalizing air, land and naval fleets, and other major equipment,
restoring infrastructure, and ensuring the Canadian Forces are ready to
deploy in the defence of Canada and Canada’s interests both at home and
abroad. The Canada First Defence Strategy continues to point the way
forward for Canada’s military.

In addition to incremental funding received for deployed operations,
National Defence’s annual expenses have increased from $15 billion in
2005–06 to $18 billion in 2008–09. In 2008–09, National Defence
spending represented approximately one-fifth of total government direct
program spending on an annual basis. These investments have strengthened
the Canadian Forces and produced tangible results, as most recently
demonstrated by the Afghanistan mission, support for relief efforts in Haiti,
and the provision of security at the 2010 Winter Olympics in Vancouver.

The Government remains committed to continuing to build the Canadian
Forces into a first-class, modern military. However, as part of measures
to restrain the growth in overall government spending and return to
budget balance in the medium term, the Government will slow the rate of
previously planned growth in the National Defence budget. Budget 2010
reduces growth in National Defence’s budget by $525 million in 2012–13
and $1 billion annually beginning in 2013–14. Defence spending will
continue to grow but more slowly than previously planned (Chart 4.1.2).

By implementing this measure beginning in 2012–13, the Government
will ensure that it does not adversely affect military operations during the
current Afghanistan mission, and that National Defence has sufficient time
to adjust its long-term expenditure plans. The Government is confident
that the long-term objectives of the Canada First Defence Strategy can be
achieved and that the Canadian Forces will continue to fully meet its three
key roles: defending Canada, defending North America and contributing to
international peace and security.

National Defence has already begun work on a comprehensive strategic
review to ensure its resources are fully aligned with the priorities set out
in the Canada First Defence Strategy. This review will identify measures
necessary to implement the Budget 2010 decision ....
 
On CBC's "Power and Politics", 1706, minister Flaherty said the CF "will have to delay some of their acquisitions".  Which?  I'd think:

CCVs
A/OPs
And certainly no new fighter selection this year.

Mark
Ottawa
 
Military escapes federal budget axe for now, but cuts loom in 2012-13
Murray Brewster, The Canadian Press, 4 Mar 10
Article link

The Canadian military dodged a bullet in Thursday's federal budget, but will still see a total of $2.5 billion carved out of future defence spending after troops withdraw from Afghanistan next year.

Funding will remain largely stable in the current year, but the Conservative government plans to take away $525 million in planned increases in 2012-13, $1 billion in 2013-14 and another $1 billion the following year.

With Ottawa facing an estimated $53-billion deficit this year and $49 billion next year, there have been calls by social welfare groups for cuts to defence spending.

The military's budget has increased by $3 billion annually since the Tories came to power four years ago. It is expected to crest above $20 billion this year.

Finance Minister Jim Flaherty said restraining defence spending is one pillar in his government's strategy to cut $17.6 billion from the federal budget over the next few years.

Thursday's budget raises questions about whether the Harper government will be able to deliver planned big-ticket purchases, including new naval supply ships, search-and-rescue planes, and armoured vehicles to replace those worn out by the Afghan war.

"We do not know right now if there will be an impact on those major capital projects," said Vice-Admiral Denis Rouleau, second-in-command for the military.

"We're certainly hoping to be able to move forward." ....

More on link
 
Here, reproduced under the Fair Dealing provisions (§29) of the Copyright Act from the Ottawa Citizen is a pretty fair assessment of the budget, with a useful list of highlights:

http://www.ottawacitizen.com/sports/faces+year+wage+freeze/2642974/story.html
PS faces 2-year wage freeze

BY KATHRYN MAY AND ANDREW MAYEDA

MARCH 5, 2010


2642975.bin

Budgets
Photograph by: Dennis Leung, The Ottawa Citizen


The Harper government targeted Canada’s 419,000 public servants Thursday with an unprecedented three-year freeze on department operations that will eat into their salaries, jobs and the programs and services they provide to Canadians.

Finance Minister Jim Flaherty’s budget is poised to take the biggest bite out of the public service — most of which is outside of Ottawa — and its day-to-day operations since the Liberals’ massive downsizing of the mid-1990s.

The freeze, which will affect salaries, administration and overhead, is expected to save $6.8 billion over the next five years, which accounts for the biggest slice of the $17.6 billion in savings squeezed from departments to reduce the $53.8-billion deficit.

The wages of public servants will be allowed to increase this year by 1.5 per cent, as mandated under collective agreements. But departments must fund the increase, which amounts to roughly $300 million, from their operating budgets. After this year, salaries and operating budgets will be frozen for two years.

The freeze will extend to the military, RCMP, Crown corporations and agencies that receive federal funding. Those that don’t, such as Export Development Corporation and Business Development Bank, are expected to follow suit.

“We will take action to ensure the government lives within its means,” said Flaherty. “Canadian families and businesses have accepted the need for restraint. Fairness requires the government, too, should have to keep costs under control.”

But the budget also set the stage for further reductions, including a slew of reviews, the results of which will be fed into the preparation of the 2011 budget.

In his speech to the Commons, Flaherty said: “Our government is focused on jobs and growth, for one simple reason. Canadians are focused on jobs and growth.”

As expected, the budget follows through on the second year of the government’s stimulus plan, a move that will inject $19 billion into the economy.

Beyond the stimulus plan, the budget contains a smattering of new initiatives, such as $60 million to help youth deal with the tough job market, $62 million for elite and amateur athletes, and $8 million to create a new oversight body for the RCMP.

But the biggest revelation is the government’s restraint plan, which pledges to all but balance the budget by 2015, when the deficit is expected to fall to $1.8 billion.

The government plans to save $4.5 billion over five years by capping foreign aid at this year’s level, in the process breaking a promise to increase aid by eight per cent per year. Foreign aid will rise by $364 million to $5 billion.

The Conservatives will also slow the rate of previously planned growth in the national defence budget — a move that will save a further $2.5 billion.

All told, the restraint measures will limit the growth of direct program spending to 1.3 per cent once the stimulus plan expires. Previously, the Conservatives had predicted such expenditures would grow at more than twice that clip.

At a news conference, Flaherty said it was a “tough budget” — one that offers probably the smallest hike in new spending in a decade.

“We have to make some tough decisions,” he said. “The economic recovery is fragile … We needed to make the decisions now so that we would have a credible plan we would follow now.”

Treasury Board President Stockwell Day will lead the “aggressive” departmental spending review, where all programs and services could be on the table. The government is also launching an administrative review to streamline internal operations of departments, from human resources to informatics, and to end duplication.

It will also hold consultations with the 18 federal unions to come up with a “reasonable” compensation regime and find ways to organize work and use technology to improve the productivity of workers. The government will also be looking for ways to “better manage” compensation, including pensions and benefits.

Budget documents say these measures will “over time” reduce the size of the public service, which has mushroomed to support the government’s spending spree of recent years.

The freeze will spark a showdown with its unions, which have already had to swallow four years of wage controls and a suspension of collective bargaining.

Unions and Treasury Board are supposed to be back to the bargaining table in 2011, but will face the pressure of the operating freeze because departments will have to absorb any raises.

“It doesn’t look good,” said John Gordon, president of the Public Service Alliance of Canada. “With the freeze, they aren’t giving departments money to pay for their employees so, when we go back to the table, does that mean we start negotiating at zero? That is not negotiating.”

Gary Corbett, president of the Professional Institute of the Public Service, said he was heartened that the government promised to consult with unions before the next phase of reductions. He said unions have ideas on how to save money that should be considered before the government starts cutting critical programs and services.

“What we’re talking about is a change in the public service now and forever because if we lose talent now we will never get it back,” he said.

None of the opposition parties said they would support the Conservative budget, but Liberal leader Michael Ignatieff said enough of his party’s MPs would abstain or be absent from the budget vote to allow it to pass, thus avoiding an election.

“Canadians don’t want an election,” Ignatieff told reporters. “What they want from me is an alternative, an alternative to cuts, freezes and gimmicks. And we’ve been working hard on that alternative.”

NDP leader Jack Layton also said his party did not support the budget, but would wait to decide how his MPs would vote, in the hopes of negotiating changes with the Conservatives. Bloc Québécois leader Gilles Duceppe said his party would outright oppose the budget.

Kathryn May writes for The Citizen. Andrew Mayeda writes for Canwest News Service.

Budget highlights

• $19 billion in stimulus measures
• Planned spending to be cut by $17.6 billion over five years
• $53.8-billion deficit cut in half in two years
• Freezing the salaries of the PM, MPs and senators
• Planned spending for military is cut by $2.5 billion over three years
• A national securities regulator within three years
• New bank notes and coins
• $62 million for elite athletes and amateur sports
• A new civilian complaints commission for the RCMP
• $3.2 billion in personal income tax relief
• $1 billion for training programs for workers
• $4.1 billion for social housing
• $1 billion over five years for Clean Energy Fund
• $300 million for Atomic Energy of Canada and the Chalk River Laboratories

© Copyright (c) The Ottawa Citizen


I think that the freeze on government departments actually translates into finite reductions in staff, propjets or, more likely, both – including in DND. It is a signal for deputy ministers to weed out the wasteful, useless projects and people – and there are plenty of both – again, including in DND and the CF.

It has been pointed out to me, elsewhere, that DND cannot, properly (efficiently and effectively) spend what it has now so some restraint may just serve to match up available (less) money with the capability to spend it well.
 
National Post editorial board: The future of the Canadian Armed Forces
Posted: March 08, 2010, 8:00 AM by NP Editor
Article Link

Last Thursday’s budget should silence the doubters: Canada’s mission in Afghanistan will end in 2011.

While some had suspected that Stephen Harper’s government might find a way to maintain a troop presence there, either by deploying a smaller contingent of troops on a rebranded mission or by appearing to be talked into it by Barack Obama, the budget makes clear that drawing down the war in Afghanistan and slowing the rate of military expenditures, will form a key part of the Conservative government’s plans to slay the deficit.

The Canadian military must now learn to make do with a budget that, while continuing to grow, will leave it with less fiscal room to plan and undertake missions than it originally had expected. One possible source of inspiration is a report released last week by the Canadian Defence and Foreign Affairs Institute, titled Whatever Happened to Peacekeeping: The Future of a Tradition.

The report lays out the history of peacekeeping and does not gloss over some of its more notable failures, including the catastrophic Rwandan Genocide in 1994. It does find, however, that the United Nations has learned from its mistakes: More recent UN missions, conducted by heavily armed troops operating under robust mandates, have proven successful at restoring or imposing peace. The current UN mission in south Lebanon, where a large, primarily European force is maintaining a buffer between Israel and Hezbollah, is cited as an example of the UN’s new kind of “peace operation” mission — large, powerful and with the necessary political support to intervene decisively.

Nevertheless, the report takes on the near-mythical status that peacekeeping has acquired in the Canadian collective psyche. After all, it was a Canadian, then-foreign minister Lester B. Pearson, who proposed in 1956 that a UN force separate hostile Israeli and Egyptian forces, ending the Suez Crisis. And Canadians, from individual observers to entire battlegroups, have served in almost every peacekeeping mission since. The concept of the Canadian soldier as a neutral observer, unaligned with any faction in global affairs and only there to help, was always a fiction for a country inextricably bound to the Western bloc, but it was a popular one with many Canadians, particularly those disinclined to favour large military expenditures and the always messy business of geopolitical brinksmanship.

Ironically, just as the notion of the Canadian as a peacekeeper was becoming a part of our national identity, the very nature of peacekeeping was changing. Two generations ago, peacekeepers were lightly armed observers, whose very vulnerability lent them the necessary moral authority to effectively adjudicate between two once-warring states. The combatants were sovereign nations that genuinely wanted a cessation of hostilities. Both sides generally took it upon themselves to ensure the safety of the peacekeepers as an integral part of showing their goodwill and support of the peace process.
More on link
 
GAP said:
One possible source of inspiration is a report released last week by the Canadian Defence and Foreign Affairs Institute, titled Whatever Happened to Peacekeeping: The Future of a Tradition.
The CDFAI report is available here

The CDFAI website says, "this ground-breaking report urges Canada to reconsider and rejoin UN peace operations." I don't know the Belgian co-author, but the Canadian is Jocelyn Coulon -- Director of the Francophone Peace Operations Research Network at the Université de Montréal.

Far from "ground-breaking," this report is little more than a re-hash of his 1998 book,  Soldiers of Diplomacy: The United Nations, Peacekeeping, and The New World Order.

Sometimes it's hard to ween academics off the UN breast. Although they note that there have been some failures, they don't acknowledge that there's been a lengthy and on-going track-record of such failures. The DPKO is little more than a cash cow.

I have a suggestion for the UN too, but it involves bulldozers.

 
Here, reproduced under the Fair Dealing provisions (§29) of the Copyright Act from the Globe and Mail and expressed in Olympic terms, is a useful article on public spending efficiency:

http://www.theglobeandmail.com/news/opinions/input-output-we-need-a-public-sector-olympics/article1491751/
Input, output: We need a public-sector Olympics
O Canada: Slower, lower, feebler

Neil Reynolds

Monday, Mar. 08, 2010

Why can't we desire excellence in government spending as passionately as we desire excellence in athletic performance? Why can't we embrace international competitions to determine who provides the world's best public services? Why can't we award gold medals to countries that, dollar for dollar, produce the healthiest, people, the best educated people, the most prosperous people?

Aren't the techniques for judging public-sector performance much the same as for Olympic performance? You calculate input (funding); you measure output (the fastest trains, the highest literacy, the strongest families). How would Canada fare?

In Olympic competition, output is easy to calculate. Count the medals. With 26 Olympic medals, Canada took 10 per cent of the 258 medals awarded, an astonishing performance compared with past Winter Games – and producing one medal for every 1.3 million Canadians. With 23 medals, Norway produced one for every 210,000 Norwegians, a six-fold superiority. For Canada to have matched that performance it would have needed to win 160 medals. With 37 medals, the United States produced one for every 8.3 million population and felt good. With 15, Russia produced one for every 9.5 million population and felt badly – although, in relative terms, it did almost as well as the U.S.

Whether processed as government subsidies, corporate sponsorships or neighbourhood bake sales, certain resources – inputs – are an essential factor for most medal winners. (You can't quantify the self-sacrifice.) People used to think that more state funding for more athletes would produce more medals. They were wrong. Now they think that more state funding for fewer athletes will produce more medals. And they're probably right. Though distinctly Darwinian, this results-driven strategy hurts no one, cuts down on waste and appears to improve performance.

When it comes to Olympic funding, the Canadian public appears to want efficient use of the government's modest inputs – and a certain medal count to justify them. When it comes to stimulus spending (to cite one example of everyday government inputs), Canadians appear indifferent to efficiency and only marginally concerned with performance. Since the inputs provided for the Olympics are insignificant in comparison with the inputs provided for all other public-sector spending, this represents a curious double standard. People know, of course, that governments are notoriously inefficient – although they don't appear to want to know exactly how inefficient. This is a dangerous ignorance.

Perhaps we need a public-sector Olympics. Here's a prototype. In an international comparison of 23 countries, published a few years back by the European Central Bank, three European economists (Antonio Afonso, Ludger Schuknecht and Vito Tanzi) endeavoured to measure the efficiency of public-sector spending. They analyzed inputs (administration, government transfers, core program spending – all the costs of the modern welfare state). Using scores of indicators, they analyzed output (educational achievement, high-school enrolment, infant mortality, life expectancy, average unemployment rates, long-term prosperity). They calculated which countries gained the most output from the least input.

In this analysis of public-sector performance in affluent, democratic countries, across a 10-year period, Canada finished 12th in input efficiency and 13th in output performance.

Expressing a gold-medal performance in public-sector efficiency by the number 1, the economists scored all other competitor countries as percentages of the first-place finish. With an input rating of 0.75, Canada's 12th-place finish meant it spent 25 per cent more money than it needed to spend – that it could have attained the same results by spending only 75 per cent of the money it spent. You could put it another way. The Canadian government wasted one dollar for every four dollars it spent.

In a three-way tie, the United States, Japan and Luxembourg took gold in this input-efficiency competition. Other top-ranked countries included Australia (0.99 for fourth place) and Switzerland (0.95 for fifth). (Its reputation for fiscal discipline notwithstanding, Norway finished behind Canada, (0.73 for 13th place.)

In the competition for public-sector performance, Canada finished with a rating of 0.84, a better score in absolute terms but a worse ranking (13th place). This score implied that Canada could have increased its public-sector performance by 16 per cent without spending another dime. (Norway distanced itself from Canada in this round, scoring 0.93 and finishing fifth.)

Without an aggressive stinginess to limit its spending, the federal government will continue relentlessly to subsidize everyone with borrowed funds. O Canada: Slower, lower, feebler.

I suspect, hell’s bells, I’m damned certain that DND can spend less and do more if management (including top level military management) and budgeting was made much, much more efficient and effective. This would require increased bureaucratic productivity in the Privy Council Office, Treasury Board Secretariat and, above all, in Public Works and Government Services Canada – AKA the Department of Public Blunders and Wonders – too.

My sense is that DND, including the CF, has too much management that accomplishes too little and, in the process of underachieving, spends too much money on itself and its processes.
 
Journeyman said:
The CDFAI website says, "this ground-breaking report urges Canada to reconsider and rejoin UN peace operations." I don't know the Belgian co-author, but the Canadian is Jocelyn Coulon -- Director of the Francophone Peace Operations Research Network at the Université de Montréal.

Sometimes it's hard to ween academics off the UN breast. Although they note that there have been some failures, they don't acknowledge that there's been a lengthy and on-going track-record of such failures. The DPKO is little more than a cash cow.

I have a suggestion for the UN too, but it involves bulldozers.

I happen to know Jocelyn as I studied under him at U of M. He strikes me not so much as dependant on the UN "boobie" as viscerally opposed to organized violence, which this brand of academic will obviously use as the sole definition of military activity. He struck me as a true "peacenik" with an establishment twist, i.e. war is bad peace is good but how can we use those nice institutions to turn our swords into...well blunter swords I guess. I amusingly recall tense debates between him and the more realist of the departments who thought that a couple of Tridents could still keep peace better than the UN.

Might need to buy a few tonka trucks to soothe this kind of academics if the bulldozer thing ever materializes...  :crybaby:
 
And since we’ve uttered the dreaded p word, here, reproduced under the Fair Dealing provisions (§29) of the Copyright Act from the National Post, is an editorial on the future of our national defence:

http://www.nationalpost.com/opinion/story.html?id=2652853
The future of the Canadian Armed Forces

National Post Published: Monday, March 08, 2010

Last Thursday's budget should silence the doubters: Canada's mission in Afghanistan will end in 2011.

While some had suspected that Stephen Harper's government might find a way to maintain a troop presence there, either by deploying a smaller contingent of troops on a re-branded mission or by appearing to be talked into it by Barack Obama, the budget makes clear that drawing down the war in Afghanistan and slowing the rate of military expenditures, will form a key part of the Conservative government's plans to slay the deficit.

The Canadian military must now learn to make do with a budget that, while continuing to grow, will leave it with less fiscal room to plan and undertake missions than it originally had expected. One possible source of inspiration is a report released last week by the Canadian Defence and Foreign Affairs Institute, titled Whatever Happened to Peacekeeping: The Future of a Tradition.

The report lays out the history of peacekeeping and does not gloss over some of its more notable failures, including the catastrophic Rwandan Genocide in 1994. It does find, however, that the United Nations has learned from its mistakes: More recent UN missions, conducted by heavily armed troops operating under robust mandates, have proven successful at restoring or imposing peace. The current UN mission in south Lebanon, where a large, primarily European force is maintaining a buffer between Israel and Hezbollah, is cited as an example of the UN's new kind of "peace operation" mission -- large, powerful and with the necessary political support to intervene decisively.

Nevertheless, the report takes on the near-mythical status that peacekeeping has acquired in the Canadian collective psyche. After all, it was a Canadian, then-foreign minister Lester B. Pearson, who proposed in 1956 that a UN force separate hostile Israeli and Egyptian forces, ending the Suez Crisis. And Canadians, from individual observers to entire battlegroups, have served in almost every peacekeeping mission since. The concept of the Canadian soldier as a neutral observer, unaligned with any faction in global affairs and only there to help, was always a fiction for a country inextricably bound to the Western bloc, but it was a popular one with many Canadians, particularly those disinclined to favour large military expenditures and the always messy business of geopolitical brinksmanship.

Ironically, just as the notion of the Canadian as a peacekeeper was becoming a part of our national identity, the very nature of peacekeeping was changing. Two generations ago, peacekeepers were lightly armed observers, whose very vulnerability lent them the necessary moral authority to effectively adjudicate between two once-warring states. The combatants were sovereign nations that genuinely wanted a cessation of hostilities. Both sides generally took it upon themselves to ensure the safety of the peacekeepers as an integral part of showing their goodwill and support of the peace process.

In more recent times, however, in the era of failed states and rogue terrorist organizations, peacekeeping has become virtually indistinguishable from warfare, with the attendant rise in military casualties and collateral damage to civilians. Our government and military leaders, too fearful of a public backlash to effectively communicate the new reality of peacekeeping--or peacemaking -- to the masses, has instead created confusion, as Canadians taught to believe that our troops are impartial observers ride into pitched battles in tanks, backed by artillery and air power. Putting off these weighty discussions any further is unacceptable.

Despite the recently announced slow-down in military expenditures, the Canadian Forces are still one of the world's elite forces, capable of independently projecting power across great distances and maintaining it there as long as the political will remains. And so our allies, the United States in particular, likely will want us on board as partners in any future Afghanistan-like war (of which we doubt there will be any shortage in coming decades). The recent relief mission in Haiti, which saw thousands of Canadian soldiers rapidly deploy aboard warships and sophisticated C-17 aircraft to provide humanitarian aid and security, is another example of the sort of mission for which Canadians will be needed.

We need to make choices now about what sort of force we want to be able to project after our withdrawal from Kandahar. With military priorities in flux and budget uncertainty returning to the forefront of the military's mind, decisions made in the short term will have major implications. It is now all but certain that the replacement of some of the military's existing hardware will be postponed or cancelled outright, so decisions made now for reasons of fiscal necessity will have profound implications as to what role Canada is capable of taking on internationally for decades.

Traditional peacekeeping, whether under a United Nations, NATO or regional mandate, is a laudable mission and something that our Forces can excel in. If that is to be our military's future, then the government owes it to all Canadians, civilians and military alike, to begin making the necessary choices now to ensure that we are the very best peacekeepers that can be. If, however, as we feel is more likely and proper, the Conservative government prefers to balance our military's future duties between international aid missions and the advancement of Canada's legitimate national interests, it would be well advised to consider carefully how best to go about tightening the budgetary reins while still leaving the Canadian Forces as a potent, flexible instrument of national policy and humanitarian relief.

The UN peacekeeping option would send us off on a succession of fool’s errands in support of ill conceived objectives, many of which will be contrary to our global interests.
 
From Jane’s, more proof, if any more was necessary, that cuts to long term projects that are aimed at plugging short term budget gaps can backfire and bite one on the bum:

------------------------------------------------
UK report slams MoD procurement

The UK Ministry of Defence (MoD) has been heavily criticised for wasting hundreds of millions of pounds on an unaffordable equipment programme, in a parliamentary report officially published on 4 March. The MoD made "ill-judged" cuts to crucial research spending in a short term bid to plug a GBP6 billion (USD9.06 billion) funding gap, but has seemingly made "no attempt" to calculate the real costs of repeated delays to equipment programmes, according to a defence equipment assessment published by the House of Commons defence committee

First posted to http://jdin.janes.com - 04 March 2010
------------------------------------------------


This is a lesson that, it appears, almost every Western nation must relearn every few years.
 
E.R. Campbell said:
This is a lesson that, it appears, almost every Western nation must relearn every few weeks.

Fixed the typo for you...
 
I fear that dapaterson's joke is closer to the mark than my serious comment.

I guess it says something about:

    + political direction and support;

    + professional competence; and

    + backbone, or lack of same.

 
Here, reproduced under the Fair Dealing provisions (§29) of the Copyright Act from the Globe and Mail are Eugene Lang’s* thoughts on the inevitability of defence restraint in current times:

http://www.theglobeandmail.com/news/opinions/if-ottawa-fights-a-deficit-the-military-has-no-allies/article1495359/
If Ottawa fights a deficit, the military has no allies
Budget arithmetic and Canadian politics mean there's no way for the military to be exempt from a major program spending cut

Eugene Lang

Wednesday, Mar. 10, 2010

Stephen Harper is the most pro-military prime minister since the Second World War. His government has pumped more money into the Canadian Forces than any of its predecessors. That's the conventional wisdom.

Consequently, many people were a little puzzled at last week's budget, when Mr. Harper's rock-ribbed administration announced a $2.5-billion cut to defence funding increases the Conservatives had committed to four years ago. This money, considered essential by the Department of National Defence, had been effectively banked to rectify acute equipment rust problems, especially in the navy. Some senior defence officials had even started referring to the funding commitments as a “contract” with the military.

So why did the government turn on its ally? The answer is straightforward, and is based on both arithmetic and politics.

First, let's dispense with some well-worn mythology. Mr. Harper's government never was the largest financial supporter of the military, not by a long shot. That distinction goes to the short-lived government of Paul Martin – the same Paul Martin who slashed and burned the defence budget as finance minister in the mid-1990s. Yet as prime minister, Mr. Martin increased defence funding by $13-billion over five years, the largest financial boost to the military in a generation. This is in contrast to the increase of $5-billion over five years that Mr. Harper's government promised in the 2006 budget.

Now for the arithmetic. The government is running a $50-billion deficit that it wants to eliminate in about five years. A good chunk of that will be accomplished when stimulus spending ends next year. But a fair bit of the red ink – what economists call the “structural deficit” – will remain. The Parliamentary Budget Officer estimates the structural deficit at about $20-billion.

This is the part that is hard to get rid of. The task is made even harder because the government has ruled out cutting transfers to provinces, reducing benefits to citizens or raising taxes. Eliminating the deficit is to be achieved through departmental program spending cuts alone. The $20-billion has to come from a pot of about $80-billion in total departmental program spending.

This is where DND comes to the fore as a matter of pure arithmetic. It is by far the largest and most costly department in the federal government, with a budget that accounts for about one-quarter of that $80-billion in departmental program spending. So regardless of how wedded any government is to the military, there is no conceivable way the Canadian Forces can be exempt from a major cut in a deficit elimination struggle focused entirely on departmental program spending.

Now, for the politics. Governments have paid steep political prices over the years for increasing taxes, cutting benefits and reducing transfers to provinces. Yet no government, Conservative or Liberal, has ever paid a discernible political price for slashing defence spending. It is simply not a priority for most Canadians.

Brian Mulroney's government cut the defence budget by nearly $3-billion in its ill-fated war on the deficit, and paid no political price whatsoever. Jean Chrétien's government virtually emasculated the DND budget, reducing it by one-third during its own deficit crusade, and got off politically scot-free.

While Canadians might be stronger supporters of the military now because of the sacrifices the men and women of the Canadian Forces have made in Afghanistan, it is unlikely that a big cut to a DND budget that approaches $20-billion a year will make any impression on the Canadian public.

In a hierarchy of public interests that includes low taxes, balanced budgets and retention of entitlements, most Canadians place military spending at the very bottom. In fact, there likely hasn't been a public-opinion survey in the history of this country that shows defence cracking into Canadians' top five priorities.

The basic lesson from all this is simple: No government, Conservative or Liberal, is pro-military when it is in a deficit fight. Arithmetic prevents this and politics permits it. That's the way it has been for decades, and that's the way it always will be.

Eugene Lang is co-author of The Unexpected War: Canada in Kandahar. He was a senior economist at Finance Canada and chief of staff to two Liberal defence ministers.

I think Lang is, largely right: arithmetic prevents exempting defence from cuts and politics permits defence to be cut so long as the prevailing political wisdom is that every department, agency and programme is worthwhile. But, the latter, highlighted, statement is, demonstrably, untrue – a few departments, several agencies and many programmes are, as TB Bank’s Chief Economist Don Drummond described them, “crappy,” and they can and should be cut and that would alter both the politics and the arithmetic for the better. 


----------
* Co-author, with Janice Gross Stein, of The Unexpected War: Canada in Kandahar, a book that tried to explain away political responsibility for sending the CF to Kandahar.
 
Government missing mark in plan to cut back military spending

Poll shows Canadians like idea of strong, well-equipped armed forces

By Elinor Sloan, FreelanceMarch 11, 2010
Article Link

t is clear that Canadians want their country to play a strong military role in the world. A recent Canadian Defence & Foreign Affairs Institute survey conducted by Innovative Research Group has found that well over a majority of those polled want the Canadian Forces to be able to contribute to humanitarian and war-fighting missions in the future.

And they are willing to put their money where their mouth is. Some 58 per cent think we should spend what the military needs to sustain the Canadian Forces' ability to fight terrorism in places like Afghanistan, support humanitarian missions, such as what we saw in Haiti, and defend Canada's homeland, for example in the North. Over a third of Canadians think we are not spending enough on the military, while less than one in five thinks we are spending too much.

Most remarkably, almost half the people polled thought that military spending should not be cut back to reduce the deficit once our country's military contribution to the mission in Afghanistan comes to an end next year, even if that means cutting other services to reduce the federal deficit.

Such views are testament to the visibility the mission in Afghanistan has brought to the armed forces, and the professional and expert ability with which its members have carried it out. More than ever, the military is part of the average Canadian's interest and thoughts.

There appears to be a renewed desire for Canada to play a leadership role in the world -- one that goes well beyond the soft-power words of yesterday, to concrete action that truly makes a difference.

The government missed this prevailing sentiment in last week's speech from the throne and federal budget. The speech mentioned only that the government has supported the Canadian Forces in words and investment, and that it would continue to "stand up" for our military since its members "stand up for the values and principles Canadians hold dear." The federal budget argues the government has made "major, necessary investments" in military capabilities in support of the June 2008 Canada First Defence Strategy and then announces $2.5 billion in future cuts to previously planned military spending starting in 2011-12.

But has the government really made the major, necessary investments? On one level, of course, it has.

The defence budget is significantly higher today (about $20 billion) than it was when the Harper government came into power (about $15 billion).

Canada's military is also larger, currently standing at about 66,000 active members as compared to around 52,000 when the Martin government was in power. Canada has a significant new military capability, strategic airlift, and is one of only a handful of countries in the world with this asset.

The government has also bought a fair bit of equipment for the army to meet the immediate demands of the Afghan mission, such as tactical unmanned aerial vehicles, tanks, armoured patrol vehicles and a handful of Chinook helicopters from the United States, pending the arrival of our own fleet.

Later this year, new Hercules transport aircraft and Cyclone maritime helicopters will start to arrive, replacing aircraft that were built almost half a century ago, and the navy's frigates will begin a modernization process.

But the hard decisions have been left to the future. Plans for Arctic Offshore Patrol Vessels, necessary for Canada to exercise control over its eastern, western and rapidly melting northern maritime regions have been put on ice.

In less than five years, the navy's destroyers that are at the centre of Canada's independent naval task group capability, critical for things like interdicting terrorists on the high seas, must be dry-docked due to their age. Yet plans for a replacement are on hold.
More on link
 
Diplomats want to have same deal as military

Foreign service officers face same risks: union

By Kathryn May, The Ottawa CitizenMarch 16, 2010
Article Link


Canada's diplomats are appealing to the Harper government for the same employment insurance benefits it gave military families sent to Afghanistan and other overseas postings in the March 4 federal budget.

The union representing Canada's foreign service officers is asking Treasury Board President Stockwell Day to extend the EI parental leave and sick leave benefits to foreign service officers who face many of the same risks as military personnel, especially when posted in war zones such as Afghanistan.

Ron Cochrane, executive director of the Professional Association of Foreign Service Officers, said he's baffled as to why diplomats and other bureaucrats posted abroad for Canada are excluded.

The union represents 1,400 foreign service officers and more than 50 are in Afghanistan.

There are also bureaucrats posted from other departments, such as the Defence Department, Canadian International Development Agency and Canadian Security Intelligence Service. At last count, more than 40 civilian employees who work for the Defence Department were in Kandahar, said John MacLennan, president of Union of Defence Employees.

"It's all focused on National Defence," said Cochrane.

"Has DFAIT (Department of Foreign Affairs and International Trade) done something? ... They are totally ignoring the rest of the public service when it comes to these changes. I don't get it. Is it deliberate? An oversight or a cost issue?"

In the budget, the government announced military personnel who adopt or have a baby will receive the EI parental leave benefits that they couldn't collect while posted overseas. This means the government will give those whose parental leave was interrupted or deferred because of a military posting an extra year of eligibility.

The government also announced that EI sick benefits will be extended to help military families coping with someone killed in action. Eligible workers who lose a family member can qualify for EI's sickness benefits.

"Canadian soldiers put their lives on the line for our country and our Conservative government is proud to stand behind them and support them," said Ryan Sparrow, director of communications for Human Resources and Social Development Minister Diane Finley in an e-mail.

In a letter to Day, PAFSO noted that diplomat Glyn Berry was killed by a roadside bomb in 2006 while on duty in Afghanistan. In December, 25-year-old foreign service officer Bushra Amjad Saeed was severely wounded in a roadside blast in Afghanistan -- the same explosion that killed four Canadian soldiers and Calgary Herald journalist Michelle Lang.

"Without diminishing the role the military has played in these theatres, employees in the rotational foreign service assigned to areas of conflict who work with military personnel are exposed to similar risks," said the letter.

This isn't the first time, PAFSO has pressed for equal treatment between the military and public servants when facing the same risks.

In 2007, it lobbied for similar tax breaks the government gives soldiers and contractors working for the military.

"No amount of money in the world will compensate someone in the military risking their life in Afghanistan ... but there are other public servants working alongside them who are also putting their lives at risk, so I don't understand the differential. If there are tax incentives for military and contractors, why not for public servants?"

The issue has also resurrected a longstanding complaint among military and diplomatic personnel that their spouses, who can't find work during postings, can't collect EI when they return to Canada. In its letter to Day, PAFSO pressed to have this changed.

The foreign service has lobbied for years for spouses of those on postings to get access to EI. It was a recommendation of the McDougall Commission, whose report on conditions in the foreign service was tabled in 1981, and has been recommended by similar reports ever since.

Cochrane argues it's difficult enough to relocate two-career families and this is another disincentive. He said it is almost impossible for professional spouses to find jobs in their chosen careers and, in some postings, they can't find jobs at all because of language, culture or other host country restrictions.

The government has a policy that anyone who is relocated abroad should not benefit nor be disadvantaged by their postings. PAFSO has long argued the government treats its members unfairly when compared to those who move with their spouses to jobs within Canada.

Under the act, they lose their entitlements to EI when abroad because they aren't available for work in Canada. This means they have to re-qualify when they return to Canada so they can't collect EI while looking for work even though they typically qualified before leaving for the posting.

The letter to Day argues this is particularly unfair because the EI act does extend the qualifying period for others, such as those incarcerated in Canadian prisons, who can collect EI when released. In light of this, the letter argues the diplomats' requests for similar treatment to the military is "a very reasonable proposal."
End of Article
 
If they can fund it out of their allotted personnel budget, then they should fill their boots. But why bother to do that when you can use precious personnel resources to lobby the Treasury Board?

Let the special pleading begin.
 
Here, reproduced under the Fair Dealing provisions (§29) of the Copyright Act from the National Post, is a useful bit of analysis from Conservative Senator Hugh Segal:

http://network.nationalpost.com/NP/blogs/fullcomment/archive/2010/03/29/hugh-segal-we-need-guns-and-butter-too.aspx
Hugh Segal: We need guns — and butter too

March 29, 2010

Hugh Segal, Canadian politics

Challenges faced by G-8 finance ministers a year and a half after the collapse of the Lehman Brothers Bank are not getting easier. Populist feeling is running against Wall Street and its analogous financial centres around the world.  Rational analysis underscores the dangers to credit and investment-based economies of any dereliction of duty to both financial stability and reasonable liquidity for the economy as a whole. This quickly becomes about balance in the way restraint spending, stimulus and tax policy are managed.

Add to this the conundrum of governments that supported financial institutions either by direct infusions of cash (as in Europe or the United States) or the purchase of multi-billion dollar mortgage portfolios (Canada) in the hopes that money would be loaned out to small businesses and consumers, only to be frustrated by financial regulators who took the more “prudential” approach of discouraging lending leverage by imposing higher capital requirements on financial institutions, and one can easily understand President Obama’s banging on the podium about insufficient lending to average Americans. Where leaders should be knocking politely (as opposed to banging) is on the door of their central financial regulators.

The liquidity challenge, which remains key to any successful budget implementation, must also confront the classic dilemma faced by finance ministers in the democracies around the old trade-off between “guns and butter.” This is often characterized as the choice between defence and security spending versus social and stimulative spending. While this may have been the most obvious of public spending dilemmas in the past, one can certainly argue today that the competition between the two is largely illusory in the geopolitical context all developed nations share.

If one takes a broad view of security and defence spending, both domestically and internationally, they clearly relate to that essential core freedom if economic opportunity is to be real — namely “freedom from fear.” If streets are not safe, if businesses are attacked by thugs and organized crime, if investors are kidnapped, if jobs are offered only when corrupt officials are paid off, fear will destroy economic development and opportunity every time. Which is why countries have laws, why anti-corruption codes matter and why international organizations (such as NATO or, on occasion, the UN) exist to protect the world from Iraqi invasions of Kuwait or Taliban-harboured al-Qaida attacks on civilians in Madrid, New York, London, Paris, Kabul, Moscow, Toronto or elsewhere. Economic development and the jobs, opportunity and security that follow are critical to the second vital freedom — “freedom from want,” which is seminal if societies are to be peaceful and productive. A world where millions are poor and only a few are wealthy or have any meaningful economic opportunity is unlikely to be a stable place — as is apparent in any city where the gaps between rich and poor are broad or getting worse. These two freedoms connect in a very precise way. Without “freedom from fear,” which requires spending on security, defence, intelligence and deployable military or police capacity, there is insufficient time to make real progress on enhancing “freedom from want” before violence or strife reduces everyone’s freedom of action. This is as true in the Middle East as it is in the drug wars of our own hemisphere. As true in Africa as it is in our First Nations communities. Without “freedom from want,” the attractiveness of crime, violence and terrorism for those with nothing to lose remains real.

In my opinion, the challenge for governments “in restraint” is devising a balanced mix of targeting “freedom from fear” and “freedom from want” so as to move toward positive trends on both accounts, if we are to make any economic and security progress in this generation. This is a larger question than the mid-term elections in the U.S., the coming U.K. election or the inevitable soon-to-be-election in Canada. And to some extent, political parties in all places that aspire to electoral progress or re-election would be well advised to approach this particular challenge in something other than a narrow partisan way.

After several years of unprecedented investment and modernization, the 2010 budget admittedly slows National Defence spending increases. This should not be surprising.  But in the time given us and in the period leading up to the winding down of combat activity in Afghanistan, we should be investing in future naval, air and reserve force capacity.  Letting the denizens of the federal civil service, Finance Department and Treasury Board weaken Canada’s defenses and our ability to engage on the “freedom from fear” challenge will be seen as a serious disavowal of prior assurances and Canada’s commitment to fight both fears simultaneously.  Similarly, with a view to the announced imposition of restraints system-wide and the current and historic duplication of Canada’s social programs, which have not reduced our poverty levels in more than two decades, this would also be the time to seriously examine a more inclusive, less micro-managed approach to its redesign and modernization. Genuine national security involves two freedoms and measurable progress on both fronts. And a post-recession modest recovery is precisely the right time to embrace these over-arching priorities.

There is no dichotomy between “guns and butter” and no dichotomy between restraint and innovation. Building real recovery and strengthening Canada at home and abroad depends upon our ability to embrace both “freedom from fear” and “freedom from want” at the same time and urging other allies and partners to do the same.

National Post

Senator Hugh Segal (Conservative, Ontario) is a member of the Foreign Affairs and International Trade Committee of the Senate.


One can only hope that Sen. Segal has some friends in the PMO and that they read this.

 
Defence spending review won’t hurt troops on ground, Day says
Andrew Mayeda, Canwest News Service  Published: Monday, May 03, 2010
Article Link

Treasury Board President Stockwell Day says a spending review ordered at the Department of National Defence shouldn't affect the military's ability to equip soldiers on the ground.

Mr. Day announced Monday that 13 departments and agencies, including the Defence Department, have been asked to comb through the combined $35-billion they spend annually and come up with $1.7-billion in savings, equivalent to roughly five percent.

For the Defence Department and the Canadian Forces, which are still fighting a war in Afghanistan, that will be a daunting task, but Mr. Day insisted the review won't affect any plans to procure military equipment.

"We're still going to have our troops and our soldiers and our overall operation seeing an increase, but we're asking for five percent savings within that increase," he told reporters.

Mr. Day noted the defence budget is still expected to increase over the next few years, even though the Conservatives trimmed the rate of spending growth in the March 4 budget. Defence spending spiked 22% last year to $19.2-billion.

Also among the list of departments under review is the Privy Council Office, the bureaucratic wing of the Prime Minister's Office. Last year, that office's budget grew 8.5% to $149-million. Under the highly centralized government of Prime Minister Stephen Harper, the Privy Council Office's role in co-ordinating the public service has taken on greater importance.

"Now, we do emphasize that we are not reducing programs to people as in EI and seniors programs and others but no department, no agency will be spared this exercise," Mr. Day said.

Monday's announcement is the latest of the so-called "strategic reviews" launched by the Harper government in 2007. Fifty federal organizations have already undergone the process, which requires departments to identify five% of their budgets to reallocate from low-priority or low-performing programs.

In the past, much of the resulting savings were reinvested in the same department. This time, the money will flow into the government's general revenues, where it could be used to help eliminate the deficit, said Mr. Day.
More on link
 
A post at The Torch:

"Defence Budget 2010/11"/Fun with figures Update (latter, largely major equipment plans, based on "Report on Plans and Priorities")
http://toyoufromfailinghands.blogspot.com/2010/05/defence-budget-201011.html

Mark
Ottawa
 
The new Liberal defence budget plans, from a paper released with Mr Ignatieff's speech today.

Story on speech:

Ignatieff unveils new Liberal foreign policy
Liberals would keep troops in post-combat Afghan training role; review military “to buy” list; boost China, India ties

http://www.thestar.com/news/canada/article/823722

Now parse the paper:

Canada in the world
A global networks strategy
(p. 22)
http://can150.ca/wp-content/uploads/2010/06/canada_world_jun2010.pdf

...Since 2005-06, as a result of both Liberal and Conservative budget decisions, Canada`s defence spending has risen nearly 50 percent and is set to continue growing even after the combat mission in Afghanistan has concluded. The Liberal Party, supports the recent investments in the Canadian Forces, but the trajectory for future years must be re-evaluated. A properly-resourced military is essential to our sovereignty and our constructive role in the world, but is not sufficient on its own. It’s a matter of balance.

The government estimates that the annual incremental cost of the combat mission in Afghanistan is nearly $1.7 billion. The Parliamentary Budget Officer has reported that the incremental costs of the mission are even higher than what has been disclosed. After the combat mission ends by December 2011, a Liberal government will re-allocate that incremental spending in a balanced manner across the full spectrum of defence, development and diplomacy. A Liberal government will also re-evaluate all major procurement programs in a post-Afghanistan combat era. A well-resourced military will remain essential, but as one element of a broader concept of what Canada does in the world, compared to the narrow view of the current government.

This change will free up resources to reinvigorate other international capacities across the federal system, better reflecting the full range of integrated functions and forward-looking engagement that will drive the Global Networks Strategy...

Emphases in original.

Mark
Ottawa
 
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