OTTAWA -- Canada recently launched its 2018 Defense Investment Plan, which aims to provide a closer look at how the government spends its defense dollars. The investment plan can be viewed as part of the new defense policy released in 2017, which called for an increase in spending over the next two decades. The government was clear to note that the investment plan itself is not a policy document, nor an operational plan. Rather, its " primary purpose is to inform Canadians, parliamentarians, industry, defense experts, media and academics, but it will be an equally useful resource within National Defence.

A big part of the investment plan rollout is the launch of a new Defense Capabilities Blueprint, which is an online, searchable database that outlines over 200 projects. This blueprint is an update of the Defense Acquisition Guide, which was an effort launched by the previous Conservative government to provide details about project spending and timelines. The DAG was last updated in 2016. The government said that the investment plan will be refreshed annually, and "reset every three years."

Canada struggles with a history of deferring acquisition spending, either in an effort to accommodate budget cuts, or because programs fall behind schedule. One of the goals of Canada's new defense strategy and accompanying investment plan is to provide more stable funding for the Department of National Defence, and for acquisition programs in general. Part of this effort also includes modifying how the department calculates capital funding requirements in an effort to reduce lapsed funding when money goes unspent.

In a speech announcing the investment plan, Defense Minister Harjit Sajjan revealed that the DND had CAD2.3 billion in unspent capital funding last year. Out of a planned CAD6.2 billion in capital expenditures, only CAD3.9 billion was actually used. According to Sajjan, about 30 percent of the unspent funds were due to lowering costs. The remaining 70 percent were due to program delays, of which 27 percent stem from the government and 42 percent from industry. These stats underscore a troubled acquisition system that Canada must address before any investment plans can be taken more seriously. The DND continues to struggle with establishing requirements, navigating a complicated bureaucracy, and keeping programs on schedule.

Source: Forecast International - International Military Markets
Associated URL: http://www.forecastinternational.com
Author: S. McDougall, Defense Analyst