Department of National Defence Budget 2001-02

Tasneem Jamal

The Ploughshares Monitor Summer 2002 Volume 23 Issue 2

  • After adjustment for inflation, Canadian Department of National Defence (DND) spending increased 3.5 per cent between fiscal years 2000-01 and 2001-02. Expenditures rose from $12.281 billion to $12.713 billion in 2001-02 constant dollars.
  • DND expenditures in 2001-02 remained significantly higher than in 1980-81, the high point of the détente period of the Cold War (before the Reagan presidency period of escalated military spending). They were 26.5 per cent higher in real terms, that is, after adjustment for inflation (see Figure 1).
  • Canadian military spending in 2001-02 was 13.8 per cent lower than at its Cold War height in 1990-91, the year the Gulf War was fought against Iraq.
  • The gross forecast spending for DND in 2001-02 includes $983,979,000 added to DND funds via the Supplementary Estimates and transfers from the Treasury Board throughout the year (DND 2002, p. 39). These additional funds include monies provided to DND in the 2001 federal budget for “emergency preparedness and military deployment.” For the 2001-02 fiscal year, Budget 2001 assigned an additional $400 million to DND for Canada’s “Operation Apollo” (Canadian participation in the US-led war in Afghanistan and naval support activities) as well as for extra department capital spending. The budget also provided an additional $44 million in 2001-02 to expand the operations of the Joint Task Force Two (JTF 2); $62 million to respond to chemical, biological, or nuclear threats; and $30 million for emergency preparedness, particularly in response to threats against Canadian infrastructure such as water and energy utilities and transportation and communications systems (Dept. of Finance 2001, Chapter 5).
  • Figure 1 includes DND “planned spending” for fiscal years 2002-03, 2003-04, and 2004-05. If the government continues the practice of recent years, it is likely that final expenditures will be higher than these estimated figures.
  • Capital spending (spending on military equipment) during 2001-02 was $2.256 billion or 17.7 per cent of total DND spending for the year. Capital spending is planned to rise in the following three years to 19.7 per cent of total department spending by 2004-05.

DND personnel and capital spending

  • In 2001-02 the estimated 59,279 in total Canadian military personnel was slightly higher than the previous year’s figure of 58,852. The defence department forecasts personnel numbers to level off at 60,500 for the fiscal years 2002-03 through 2004-05.
  • Military personnel numbers are expected to stabilize at about 60,000 after steadily dropping through the 1990s from the recent peak of 88,000 in 1989-90.
  • Proportionately, in recent years the number of Canadian military personnel has declined more than total military spending. While the defence budget declined 13.8 per cent between 1990-91 and 2001-02, the number of military personnel dropped 31.8 per cent. (From the peak of 88,000 personnel in 1989-90, the drop was 32.6 per cent.)
  • Capital spending per soldier has steadily, if somewhat erratically, risen from 1980-81. In fact, the spending more than doubled during the period, from about $18,000 per soldier in 1980-81 to about $38,000 per soldier in 2001-02 (both figures in 2001-02 constant dollars). Plans are for capital spending to exceed $40,000 per soldier by 2004-05.
  • The numbers suggest that in spite of complaints that the defence budget is not sufficiently weighted towards capital spending (a target of 25 per cent is often advocated), recent practice has seen a steady shift in emphasis from personnel to equipment. In the period since 1980-81, the number of soldiers has declined by more than a quarter, while the cost of equipment per soldier has more than doubled.


Figure 1


Figure 2


Department of Finance 2001, Budget 2001 – Budget Plan.

Department of National Defence 2002, National Defence 2002-2003 Report on Plans and Priorities.

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