Canada’s Defence Dilemma: Securing the Future Amid Budget and Strategy Challenges

For decades, Canada’s approach to national defence has been characterized by a careful, often cautious, balancing act. However, the rapidly shifting global landscape—marked by rising geopolitical tensions, climate-driven security threats, and accelerating technological change—is forcing a long-overdue reckoning. The central question is no longer if Canada needs to modernize its military, but how it can possibly afford to do so while aligning its strategy with 21st-century realities. This is the core of Canada’s defence dilemma: a pressing need to secure the nation’s future colliding with persistent budget constraints and strategic ambiguities.

The High-Stakes Modernization Wishlist

At the heart of the challenge is a procurement pipeline so vast and expensive it threatens to overwhelm the entire defence budget. The Canadian Armed Forces (CAF) is grappling with aging equipment across all domains, requiring simultaneous, generational replacements.

Sky-High Ambitions: The Fighter Jet Quandary

The most prominent symbol of this modernization effort is the F-35 stealth fighter jet program. After a long and politically fraught selection process, Canada is committed to purchasing 88 of these advanced aircraft. While they represent a leap in capability, the program carries an estimated price tag of $19 billion for acquisition alone, with lifetime costs soaring far higher. This single project consumes a monumental portion of capital spending, forcing difficult trade-offs elsewhere.

The Silent Service in Peril: Submarine Capability

Perhaps even more critical, yet less visible, is the state of Canada’s submarine fleet. The four Victoria-class submarines, purchased second-hand from the UK in the 1990s, are plagued by availability issues and require life-extension overhauls just to remain operational into the 2030s. Meanwhile, the debate over their replacement has barely begun. Given that modern submarines can take 15-20 years to design, build, and deploy, Canada risks a catastrophic capability gap in underwater surveillance and defence—a gap adversaries are eager to exploit in the strategically vital Arctic and Atlantic approaches.

The Arctic Imperative and the NORAD Modernization

Nowhere are the gaps more apparent than in the Arctic. As the region becomes more accessible and contested, Canada’s ability to assert sovereignty and monitor threats is limited. The joint Canada-U.S. North American Aerospace Defense Command (NORAD) modernization plan is a response to new hypersonic and cruise missile threats. Canada’s pledged $38.6 billion contribution is meant for new surveillance systems like the Over-the-Horizon Radar, but this funding exists alongside, and in competition with, the other massive procurement needs.

The Crushing Weight of Competing Priorities

The dilemma intensifies when these big-ticket items are viewed not in isolation, but as part of a broader national picture.

• Personnel Crisis: The CAF is short thousands of members, from recruits to highly trained technicians. Modern equipment is useless without the people to operate and maintain it. Competitive salaries, housing, and addressing cultural issues are urgent and expensive human resource challenges.
• Budgetary Reality: Despite recent increases, Canada’s defence spending as a percentage of GDP remains below the NATO benchmark of 2%. The Parliamentary Budget Officer has repeatedly warned that the current funding trajectory is insufficient to meet the government’s own defence policy objectives, suggesting a multi-billion dollar shortfall.
• Strategic Clarity: What is the primary role of the CAF? Is it continental defence with NATO as a key pillar? Is it sovereignty protection in the Arctic? Is it supporting global stability through UN missions? The answer is “all of the above,” but without a clear, publicly debated hierarchy of threats, procurement decisions can seem reactive and scattered.

Navigating the Dilemma: Pathways Forward

Solving this multi-faceted crisis requires moving beyond cyclical debates about spending percentages. It demands tough choices, strategic creativity, and long-term commitment.

Embrace “Smart Procurement” and Long-Term Planning

The history of Canadian defence procurement is littered with delays, cost overruns, and cancelled projects. Breaking this cycle requires:

• Multi-partisan, long-term funding commitments that survive election cycles, providing predictability for industry and the military.
• Streamlining the Byzantine procurement bureaucracy to move at the “speed of relevance.”
• Exploring creative financing models and leveraging closer industrial cooperation with key allies.

Define the “Canadian Model” of Deterrence

Canada does not need, and cannot afford, to mimic the force structure of a superpower. It must define a unique value proposition within the NATO and NORAD alliances. This could mean:

• Doubling down on niche, high-impact capabilities like cyber warfare, special forces, Arctic reconnaissance, and undersea surveillance where Canada can offer disproportionate value to collective security.
• Making explicit, public choices about what capabilities are essential for sovereignty and which can be provided in partnership with allies.

Invest in the Foundation: People and Readiness

A military is more than its equipment. Sustainable modernization must be built on:

• A concerted, well-funded campaign to rebuild the ranks and restore morale, making military service an attractive and respected career path.
• Ensuring that existing equipment is fully maintained and operational—a “ready force” today is more valuable than a “future force” that is perpetually over the horizon.

Conclusion: A Crossroads for Canadian Security

Canada’s defence dilemma is not merely an accounting problem. It is a fundamental test of the nation’s political will and strategic vision. The choices made—or deferred—in the coming years will determine Canada’s ability to protect its sovereignty, uphold its international commitments, and contribute meaningfully to global stability for decades to come.

The path forward is undeniably expensive and complex. It requires a national conversation that moves beyond partisan politics and acknowledges that in a world of renewed great power competition and evolving threats, the cost of credible defence is high, but the cost of unpreparedness is incalculably higher. The time for decisive action, clear priorities, and sustained investment is now. Canada’s security future depends on it.