Question Period Note: Defence Spending to reach NATO’s 2% target

Canada has committed to reach defence expenditures of 2% of gross domestic product, as agreed to with NATO members at the Vilnius Summit in 2023.

• Canada’s commitment to NATO is unwavering and we are committed to spending 2% of gross domestic product on defence by 2032
  • Public Services and Procurement Canada will continue to acquire defence goods and services, on behalf of our partners with an aim towards meeting the NATO target
  • The Government continue to explore options to expedite the timeframe to reach the 2% benchmark

The Defence Procurement Review is leading the development of “acquisition pathways” to improve the delivery of equipment and capabilities to the Canadian Armed Forces.

Acquisition pathways are tailored processes that match the characteristics of the capability being acquired. These pathways will support procurement leaders to make effective decisions, to use resources and to maximize impact on procurement outcomes.

In December 2024, the Government Contracts Regulations were amended to exempt contracts where a National Security Exemption is properly invoked, and/or to exempt contracts with Government entities. These amendments will help clarify requirements, enhance transparency and support alignment with Canada’s domestic and international trade agreement procurement practices. They may also help streamline and expedite procurements, including defence procurements, by reducing administrative burden.

Public Services and Procurement Canada is committed to reaching its goals and will continue to collaborate with its partners in order to meet NATO targets.

• Canada’s expected commitment to defence spending in 2024 was 1.37% of gross domestic product
  • The updated defence policy, Our North, Strong and Free, outlines $8.1 billion in new defence spending over the next 5 years, and $73 billion over the next 20 years
  • Canada’s defence spending is expected to reach 1.76% of gross domestic product by 2029 and 2030