Canada has announced a new defence spending plan that proposes an increase of more than C$9bn ($6.5bn) in military-related investments this fiscal year (2025-26).
Of the total spending for this fiscal year (2025-26), C$8.3bn will be recognised on an accrual basis. The move is part of a broader strategy to fortify the nation’s sovereignty and stimulate economic growth.
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The plan encompasses a range of foundational investments in the Canadian Armed Forces (CAF), with a focus on recruitment and retention, equipment and infrastructure repair, and digital resilience.
A C$2.6bn allocation will support the military’s personnel needs, aiming for a combined force of 71,500 regular and 30,000 primary reserve members by 2030.
An additional C$844m is earmarked for the maintenance and revitalisation of key CAF infrastructure, ensuring operational readiness. This includes leveraging the National Procurement Program to enhance the repair and upkeep of critical military equipment across various domains.
To bolster the defence team’s technological edge, C$560m will be directed towards strengthening DND and CAF’s digital foundations. This investment aims to safeguard against cyber threats and improve data-driven decision-making. The Communications Security Establishment (CSE) will also benefit from this funding.
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By GlobalDataThe government is also dedicating C$1bn to expand and introduce new military capabilities, with a particular emphasis on Canadian suppliers and the Arctic region. This aligns with commitments made in the national defence policy, Our North, Strong and Free (ONSAF).
In an effort to solidify Canada’s defence industry relations, C$2.1bn will be invested to support the development of a comprehensive Defence Industrial Strategy (DIS). This strategy will address current industry challenges and enhance partnerships within NATO.
In addition, C$2bn will be allocated to diversify defence partnerships beyond the traditional alliance with the US, reflecting the changing global landscape. The planned spending for the fiscal year also includes C$135m for defence-related investments across other government departments and agencies.
Canada Prime Minister Mark Carney said: “In an increasingly dangerous and divided world, Canada must assert its sovereignty. We will rapidly procure new equipment and technology, build our defence industrial capacity, and meet our NATO defence commitment this year. Canada will seize this opportunity with urgency and determination.”
