Feds to spend less on military kit, again

OTTAWA • For the second year in a row, the federal government is expected to spend billions less on new military equipment than promised because of a combination of good and bad news: cost savings on some projects and delays in others. The Trudeau government in 2016 released a new defence policy that included dramatic increases in spending on new aircraft, ships, armoured vehicles and other military equipment over the next 20 years. The investments are vital to replacing the Canadian Forces’ fighter jets, ships and various other aging equipment with state-of-the-art kit. Yet while new budget documents filed in the House of Commons show National Defence has so far been given authority to spend $4 billion this fiscal year, the policy had predicted total spending of $6.5 billion. The department does have until March 31 — when the fiscal year ends — to make up the $2.5-billion difference, but its top civilian official, deputy minister Jody Thomas, admitted Thursday that a large shortfall is likely. Part of the reason is that the department expects to save about $700 million on various projects that ended up costing less than planned, Thomas said following a committee appearance on Parliament Hill. “We’ve delivered things more efficiently than was anticipated and so we don’t need the money,” she said. “And we can apply it to projects, either new projects or projects that have a cost overrun.” But delays moving some projects through the procurement system have also caused their share of problems, Thomas said, and the department is expecting to have to put off $1 billion to $1.3 billion in purchases it had planned this year. “We’d like to (spend) $6 billion every year. Can I guarantee to you that we’re going to do that? No, there’s slowdowns in projects, there’s slowdowns with suppliers, there’s changes in scope. Things change,” she said. “I’m hoping to get it below $1 billion. I’m not committing to getting it to below $1 billion . ... We’re driving projects to get it as low as possible and spend funds efficiently and effectively. We’re not wasting money.”