The Trudeau Government released its defence policy, Strong, Secure, Engaged, in June 2017 with considerable fanfare around the publication’s fiscal underpinnings. It was stated that the policy review that led to the document was the most rigorously costed Canadian defence policy exercise ever. The policy was supported by external auditors and accompanied by several fiscal transparency initiatives. The document included a 20-year projection of the underpinning budget – in the accrual accounting format used in federal budgets – as well as a projection of cash spending, which is the accounting format used in the Estimates and reports to Parliament. The policy also included a projection of how Canada would measure up to the NATO spending targets to which it had committed as a member of the alliance, spending two per cent of gross domestic product (GDP) on defence and spending 20 per cent of that money on equipment purchase and related research and development. These spending projections are all a novel feature of Canadian defence policy under Strong, Secure, Engaged and they allow progress on the policy to be measured. While funding never tells the full story on any public policy file, it is a critical indicator of policy implementation.
Two years after the publication of Strong, Secure Engaged, the Trudeau government’s record of spending the money to implement its policy is a largely positive one. The government is struggling to spend as much on capital (equipment and infrastructure) as it hoped, and spending on equipment and related research and development as a share of the defence budget is falling short of expectations. However, spending on those procurement projects is rising in inflation-adjusted dollars for the first time in years. Meanwhile, total defence spending is meeting, or exceeding, the expectations set with the policy’s publication.