Canada meets NATO defence target, but opposition says it's 'creative accounting'

OTTAWA — The North Atlantic Treaty Organization (NATO) confirmed on Thursday that Canada’s defence spending has reached the target of two per cent of gross domestic product, a commitment that has been 20 years in the making.

“We control our destiny,” Carney told reporters in Halifax. “I am pleased to announce today that we have kept that ambitious promise.”

Carney said Canada has not spent this much on defence since the fall of the Berlin wall in 1989.

“For the last 10 months, Canada’s new government has been working with unprecedented speed and scale,” he said.

“In 10 months, we have invested more than $60 billion in our defence and security. That’s the largest year-on-year increase in defence investment in generations.”

NATO released a report on Thursday outlining the defence expenditures of its 32 members. In 2025, for the first time in its history, all members of the defence bloc met the 2 per cent spending target.

In 2006, NATO members agreed to spend two per cent of its GDP on defence and renewed that commitment in 2014.

Despite that promise, former prime ministers Stephen Harper and Justin Trudeau were unable to hit that target.

The report said Canada spent just over $63 billion annually on military spending in 2025.

“For too long, European allies and Canada were over reliant on U.S. military might,” said NATO Secretary General Mark Rutte, during a press conference on Thursday in Brussels.

“There has been a real shift in mindset, a collective recognition of our changed security environment.”

Rutte told reporters without the present administration under U.S. President Donald Trump, he doesn’t believe allies would have reached the spending target.

“Take some big economies like Spain, Italy, Belgium and Canada, were far from the two per cent mark,” he said. “They all got to the two per cent.”

Trump has accused Canada in the past of being a laggard on defence spending in the NATO alliance.

Conservative Defence Critic James Bezan said he agreed with Rutte’s statement.

“It’s no question that Mark Carney is responding to the person in the White House,” he said, during a press conference in Ottawa.

“That’s the wrong reason, we were supposed to be here as a nation more than two years ago, we shouldn’t have been dragging our feet and dithering and not making the investments into the equipment that we need to make sure that our forces can do the job that they’re called upon to do.”

Bezan said the federal government’s “creative accounting” has not increased the operational readiness and capability of the Canadian Armed Forces.

“We are still sitting with many fleets, whether it’s in the air force, the army or the navy, that are unserviceable,” he said. “Only 50 per cent of the Canadian Armed Forces equipment is deployable, and we know that that’s impacting on our operational readiness and our interoperability with our allies.”

Since he took office, Carney has announced several defence-related expenditures, including but not limited to a pay raise for CAF personnel, new over-the-horizon radar capabilities in the north, new satellites for the CAF and a $307-million contract to Colt Canada to manufacture the first phase of CAF’s new arsenal of Canadian Modular Assault rifles.

Carney has also stood up a new Defence Investment Agency to speed up procurement and a new defence industrial strategy, although the former has been criticized for adding more redundant bureaucracy and bypassing procurement rules.

The government has also transferred the Canadian Coast Guard and aircraft from Transport Canada into the Department of National Defence in a bid to meet its spending target.

Carney along with other NATO allies have committed to a second and more ambitious spending pledge of five per cent of GDP by 2035, with 3.5 per cent on core defence and 1.5 per cent on defence adjacent infrastructure and industries.

There remain two large procurement projects that are awaiting a final decision by Carney’s government, including a contract to build Canada’s next generation of submarines and a review on a fleet of American-made F-35 fighter jets.

National Post

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