Defence Highlights: Budget 2016

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Budget 2016 was tabled on March 22, outlining commitments to provide security for Canadians at home and abroad, and to ensure the CAF has the capabilities it needs to carry out missions. The 2016 Budget contained several highlights of note for members of our Defence Team.

Consistent and Predictable Funding

The government is respecting its commitment to consistent and predictable funding for National Defence.  This includes a planned two per cent increase as a result of the annual defence escalator, which is calculated on the basis of key operational expenditures. The full amount of the defence escalator for fiscal year  2016-17 is $361.1 million.
Of capital expenditures that had been planned over the next six years, $3.7 billion has been moved to later  years to match the timing and delivery of key capital projects. This was done to protect this funding, and to ensure it is available when needed. These funds remain reserved for the exclusive use of DND, and can be requested as needed – even before the six years are up, should that be required. The government remains committed to accelerating the procurement process to ensure members of the CAF are well-equipped to perform the missions asked of them.
Overall, spending in 2016-17 is currently expected to be about the same as 2015-16, or $19.7 billion. Of that, $18.6 billion has already been requested in the Main Estimates, which were tabled earlier this month. As usual, requirements not identified in time for those Estimates will be sought later.

Op IMPACT and Infrastructure Funding

The budget confirmed an additional $306 million for Operation IMPACT and announced $200.5 million for infrastructure, both over two years. The latter includes $50 million to upgrade or construct military housing across Canada. The funding will also address CAF infrastructure needs to support readiness, such as airfields and ramps, and infrastructure, such as armouries, to support the Reserve Forces.

Highlights of interest

Other Budget 2016 highlights, which fall outside the mandate of the DND/CAF but may be of interest to Defence Team members, include $78 million over five years to reopen Veterans’ Affairs service offices in Charlottetown, Sydney, Corner Brook, Windsor, Thunder Bay, Saskatoon, Brandon, Prince George and Kelowna and to open an additional office in Surrey. Also, outreach will be expanding to veterans in the North and additional case managers will be hired to reduce the overall client-to-case manager ratio. The Disability Award maximum was increased to $360 000 in 2017 for injuries or illnesses caused or worsened by military service, and access will be expanded to higher grades of the Permanent Impairment Allowance to better support veterans who have had their career options limited by a service-related illness or injury. Budget 2016 provides additional funding for VAC’s Earnings Loss Benefit (ELB) program, mainly to increase the long-term disability benefit from 75 per cent to 90 per cent of salary.
Further, the budget includes more than $77 million over five years to improve the security of government networks and information technology systems. Over $106 million will be provided for the International Police Peacekeeping and Peace Operations Program.In response to the commitments outlined in the budget, DND/CAF will work to ensure that Canada maintains a modern, combat-effective, multi-role military able to conduct the missions.
To read highlights and the plan in its entirety, visit the Budget 2016 website at

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