If words were weapons, Canada would be armed to the teeth. If platitudes were platoons, Prime Minister Justin Trudeau would not have spent much of last week making excuses for his government’s failure to rebuild this country’s military.
It was obvious that flak would be headed Canada’s way as the members of the North Atlantic Treaty Organization gathered in Washington last week for the 75th anniversary of the alliance. Canada, alone among NATO members, had not laid out a path to fulfill its commitment to spend at least 2 per cent of gross domestic product on defence.
Mr. Trudeau did not arrive armed with a plan to make up for that deficiency. Instead, he fired off a flimsy goal, launched some excuses and deployed misleading rhetoric.
He said Canada will hit the target of 2 per cent of GDP by 2032, eight years and at least two elections hence, and that details will arrive as part of the next defence review – in 2028. That is a plan to come up with a plan, years from now.
(For their part, the Conservatives are not doing any better in laying out a coherent and credible plan to meet Canada’s NATO commitment.)
As is so typical with this government, Mr. Trudeau conflates the saying of something with action. Equally familiar is his excuse that the Conservatives, now out of office nearly a decade, are to blame. “We have stepped up massively, after years of underinvestment by the previous government,” he told reporters.
Officially, Canada is projecting that it will spend 1.4 per cent of GDP on defence (up from 1 per cent in 2015, the final year of the Harper government) in the current fiscal year, rising to 1.76 per cent by 2030. From there, Mr. Trudeau said, defence spending can “clearly and naturally” increase to 2 per cent of GDP in 2032.
But that is a highly distorted picture. For a start, a large part of the increase in defence spending since the Harper era is due to an accounting change that included items such as military pensions in Canada’s official figure for defence spending. Those changes are allowed under NATO rules, but the Liberals fail to make it clear that they are comparing Mr. Harper’s apples with Mr. Trudeau’s oranges.
The government’s current projections for meeting its NATO commitment benefit from other accounting boosts, too, as the Parliamentary Budget Officer made clear last week. As the accompanying chart shows, the PBO’s forecasts for defence spending are significantly less rosy than the government’s.
Why the gap? Part of the answer is that the PBO uses its own projections for GDP, which are higher than the forecasts used by the Department of Defence and NATO, which are prepared by the Organization for Economic Co-operation and Development. That means defence spending is measured against a larger denominator. The PBO noted that its forecasts are “broadly similar” to projections from the Department of Finance.
The PBO also discounted projected military capital spending based on Canada’s long-standing failure to actually spend budgeted funds – in essence assuming that Ottawa will not eliminate its perennial procurement problems.
The Department of Defence said it disagrees with the PBO’s assessment, noting that it is standard practice for NATO countries to use a common set of projections from the OECD to measure spending, and that it is taking steps to improve procurement. Let’s check in next year.
Tellingly, Mr. Trudeau took issue last week with the 2-per-cent NATO threshold itself, arguing the metric is arbitrary. Indeed, it is. What is not arbitrary is that Canada has pledged to hit it. What is not arbitrary is that meeting this country’s defence challenges will require billions of dollars more than the Liberals have committed, and that this country’s service personnel deserve better. No number of rhetorical sorties from the Prime Minister will change those facts.