The federal budget released by the Liberal government includes a raft of new defence initiatives including $182.6 million for sovereign space launch capability.
The new funding is meant to “establish a sovereign space launch capability” with funds available this fiscal year and spent over three years. How the money will be spent and on what has yet to released.
As anticipated Canada will have a new Defence Investment Agency (DIA). The government says the DIA “will overhaul and streamline Canada’s defence procurement. The DIA will approve procurements to support strategic defence sectors in Canada, so that we are able to ensure the Canadian Armed Forces has the world-class equipment it needs, and at the same time create new careers, grow our economy, and support innovation in aerospace, shipbuilding, and advanced manufacturing.”
Overall the government plans to spend $81.8 billion over five years (starting 2025-26) to rebuild, rearm and reinvest in the Canadian Armed Forces (CAF).
Key allocations include:
- $20.4 billion over five years for recruiting, retaining personnel and improving CAF health care.
- $19.0 billion to repair/sustain military equipment and infrastructure.
- $10.9 billion for upgrades in digital infrastructure, cyber defence etc.
- $17.9 billion to expand military capabilities (vehicles, counter-drone, ammunition production, etc.)
- $6.6 billion over five years, starting in 2025-26, to strengthen Canada’s defence industry through a Defence Industrial Strategy.
- $6.2 billion over five years to expand Canada’s defence partnerships, including expanded military assistance to Ukraine and increased military training and international policy programming.
- $805 million over five years to the Canadian Coast Guard, the Canadian Security Intelligence Service, and Public Services and Procurement Canada for complementary initiatives to support Canada’s defence capabilities.
The government is also going forward with Defence Industrial Strategy (DIS) which has been under discussion.
Initial DIS will have $4.6 billion over five years again starting this fiscal year “on a cash basis.” Initial investments include;
- $68.2 million over three years, starting in 2025-26, to the Department of National Defence (DND), Innovation, Science and Economic Development Canada (ISED), the National Research Council (NRC), and the Communications Security Establishment to establish the Bureau of Research, Engineering and Advanced Leadership in Innovation and Science (BOREALIS). This new organization would be similar to the Defense Advanced Research Projects Agency in the U.S.
- $1.0 billion in 2025-26 to create a new Defence and Security Business Mobilization Program at the Business Development Bank of Canada to provide loans, venture capital, and advisory services to help small-and medium-sized businesses contribute to Canada’s defence and security capabilities.
- $656.9 million over five years, starting 2025-26, to ISED to develop and commercialise dual civilian-military technologies in a range of industries, including aerospace, automotive, marine, cybersecurity, artificial intelligence, biodefence, and life sciences.
- $334.3 million over five years, starting in 2025-26, to ISED, NRC and the National Science and Engineering Research Council for a suite of measures to help anchor quantum technology companies in Canada and provide pathways to technology adoption in defence-related applications and industries.
- $443.0 million over five years, starting in 2025-26, to Natural Resources Canada and ISED to support the development of innovative critical minerals processing technologies, support joint investments with Allies in Canadian critical minerals projects, and develop a critical minerals stockpiling mechanism to strengthen Canadian and Allied national security.
- And the previously mentioned $182.6 million over three years, starting 2025-26, to DND to establish a sovereign space launch capability.
The government also is committing to investing 3.5 % of GDP by 2035 in “core defence needs”, and a further 1.5 % through other levels of government, totalling 5 % of GDP in defence investment by 2035.
More to come. In the meantime follow our ongoing Launch coverage.