Prime Minister Mark Carney pledged a 27% defence spending hike on Monday, leading a caucus member to dismiss a spring budget due to “rapidly changing” figures.

“When we stand up for territorial integrity, whether it's in Ukraine or West Bank and Gaza, we are also standing up for the territorial integrity of the Canadian Arctic,” Carney told reporters Monday.

“Government must start by fulfilling its most fundamental role which is to defend Canadians,” he said, noting Canada's defence spending hasn’t reached 2% of GDP since 1990.

“If we want a better world, we will have to make difficult choices and work harder than we’ve had to in decades.” 

Delayed six months, Budget 2025 faces further shifts as Liberal MP Chi Nguyen cites “rapidly changing” figures, including an unbudgeted $9.4 billion defence increase due to NATO commitments.

“Is the first responsibility not to table a budget?” asked Bloc Québécois MP Marie-Helene Gaudreault. “We are doing our work… to make sure when we bring the budget forward in the fall it has the right figures,” replied MP Nguyen.

“The right figures?” asked Conservative MP John Brassard. “Don’t they have the right figures to be able to table a budget now? Doesn’t that make any sense?”

Canada, having lagged on its NATO spending commitments for years, remains one of the last NATO members to address the 2% spending pledge.

To meet NATO's 2% GDP spending target, Budget 2025 must allocate $44 billion, an increase of $9.4 billion from 2024's $34.6 billion. This aligns with Canada's $2.2 trillion GDP, according to Blacklock’s.

“Canada will achieve NATO’s two percent of GDP target this year, half a decade ahead of schedule,” said Carney. “And we will further accelerate our investments in years to come consistent with meeting these new security imperatives.”

The Prime Minister's Office announced increased military spending including $2.6 billion for recruitment and benefits, $1 billion for new equipment, $844 million for vessel and aircraft repairs, and $560 million for computer upgrades, along with better pay and health care for Canadian Armed Forces personnel.

“Now is the time to act with urgency, with force, with determination,” said Carney. “As the world grows more dangerous Canada will ensure our country is protected.”

Recent polling indicates a surge in Canadian support for increased defence spending, with 68% favouring 2% of GDP or more, and 17% wanting to exceed that. This marks a near doubling of those supporting higher spending since March 2024.

“Our military infrastructure and equipment have aged, hindering our military preparedness,” said Carney, noting Canada remains “too reliant” on the United States for defence.

Canada earlier committed to the "ReArm Europe" initiative, designed to strengthen military preparedness among European NATO members. It has sparked U.S. concerns about potentially strained U.S.-Canada defence relations if European alliances are prioritized.

Sixty percent of Canadians favour closer ties with Europe over the U.S., while only 23% prefer aligning with the U.S., with the remainder undecided.

Asked how the government should pay for the increase, 62% said it should be covered by cuts to other federal programs.

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