Canada pledges billions in new defence spending, but doesn't reach NATO's 2% commitment

Two years after being ordered on an urgent basis, a new defence policy for Canada was unveiled Monday that promises — among other things — to bolster the military's surveillance and combat capabilities in the Arctic.

The strategy commits to delivering new equipment, including airborne early warning aircraft (AWACs), long-range surface-to-surface missiles for the army and utility helicopters that may or may not be manned.

The plan also lists new equipment the Department of National Defence is considering acquiring, such as air defence systems to protect critical infrastructure and new submarines.

The new policy, entitled Our North, Strong and Free, includes an additional $8.1 billion in new defence spending over the next five years and commits to an additional $73 billion in defence spending over the next two decades.

The additional investments will not bring Canada all the way to meeting NATO's military spending target for member nations — two per cent of national gross domestic product. The Liberal government estimates that the new policy will see military spending rise to 1.76 per cent of GDP by 2029-30.

"This is a significant increase in defence spending and is a major step forward in our effort to reach two per cent of GDP, as agreed by NATO members at the Vilnius Summit in 2023," the policy document says.

How the document will be received by Canada's allies — many of whom have been putting pressure on Ottawa to meet its commitments in response to Russia's war on Ukraine — remains to be seen.

Prime Minister Justin Trudeau defended the document during its unveiling at the country's largest military air base in Trenton, Ont. on Monday. He said some elements of the plan have not yet been costed — items that could affect the bottom line down the road.

"So even as we project we're heading up to 1.76 per cent of GDP in the coming years, we know there is more to come over the coming years, as Canada continues to step up in a more uncertain and, quite frankly, more dangerous world," Trudeau said.

U.S. Ambassador to Canada David Cohen said in a media statement that the Biden Administration is pleased with the direction of Canada's investments in defence.

"Moving from 1.33 per cent to 1.76 per cent by 2029-2030 is real progress, and we are also encouraged by the assurances we have received that there will be additional investments," Cohen said.

Major allies, notably the United States and Britain, also have been pushing Canada to take a more active position in defending the Arctic, where Russia has been building up and restoring many Cold War capabilities and bases.

"The most urgent and important task we face is asserting Canada's sovereignty in the Arctic and northern regions, where the changing physical and geopolitical landscapes have created new threats and vulnerabilities to Canada and Canadians," says the policy document.

The strategy says the new threats in the region include "advanced submarines [and] hypersonic and cruise missiles." To meet those threats, the defence policy says the federal government will establish a network of northern operational support hubs, buy a fleet of airborne early warning aircraft, deploy underwater sensors on all three coasts, build a satellite ground station in the High Arctic and enhance Canada's foreign intelligence capabilities.