Thank you very much, Mr. Chair.
Thank you, colleagues. It's great to be back here with Minister Fantino and this distinguished panel.
I should just point out that the last time we saw ADM Finn, he was wearing a uniform as an admiral. He has since transformed into a civilian, but is still in service to DND. I want to thank him for his military service to Canada in our uniform.
Colleagues, it's a pleasure to be here to discuss the main estimates for the fiscal year we've just begun. As you know, we have made important, significant new investments in the capabilities of the Canadian Armed Forces so that we can project Canada's values and interests around the world and defend Canadians here at home.
If approved, the funds I am seeking would raise National Defence's total spending authorities to $18.9 billion for this fiscal year. These estimates demonstrate our long-standing commitment to the armed forces and the modernization and replacement of key platforms to enable them to continue to deliver excellence in operations. This is also reinforced by budget 2015, which raises the annual Defence escalator from 2% to 3%, beginning in fiscal year 2017. This will increase spending on Canada's military cumulatively by $11.8 billion over the subsequent decade. This investment is critical to keeping Canadians safe, critical to defending our interests, and critical to working with our allies and partners in the pursuit of international peace.
Here's what the Canadian Association of Defence and Security Industries said about that budget: “Not only is the budget balanced, which is a good thing for Canadians, but it provides a range of initiatives that are important to Canada's national defence and national security, which is all about keeping...us safe.”
Through the government's investments, the Canadian armed forces are making a meaningful contribution in a number of theatres around the world. I recently returned from a trip with the Prime Minister to visit the hard-working personnel currently deployed to Iraq and Kuwait as part of Operation Impact, where they are working closely with our allies to degrade the so-called Islamic State.
Frankly, it is remarkable, Mr. Chair. We talk about the division and geopolitical complexities in the Middle East all the time, but in the fight against Daesh, the so-called Islamic State, there is a coalition bringing together Arabs, Kurds, Muslims, Christians, Shia, Sunni and minorities such as the Yazidis and Assyrians. Almost all the countries and the peoples in the Middle East have come together to destroy this appalling threat to human dignity, human rights, the security of women and girls and, of course, Canada's security.
Coalition airstrikes are helping to degrade them. In northern Iraq, the Iraqi forces are gradually taking back ground east of Mosul. The Prime Minister and I saw this. A few months ago, we were at an observation station of the peshmerga, with the help of the Canadian special forces. This was a base, an observation point for Daesh, the Islamic State.
In central Iraq, in the west and everywhere, Daesh is losing territory. The Iraqis are reclaiming their own territories, partly because of the contribution of the Canadian Air Force and the assistance of the Canadian government.
We have personnel deployed in Central and Eastern Europe to demonstrate Canada’s solidarity with our NATO allies against Vladimir Putin’s aggressive policies.
We have military doctors, nurses, medics and support staff deployed to Sierra Leone to help fight the spread of Ebola.
We recently deployed the Disaster Assistance Response Team to Nepal, to provide humanitarian assistance following a devastating earthquake.
Mr. Chair, I'm happy to report that later this month, at the beginning of June, the Canadian Armed Forces will be deploying some 200 personnel to begin an important military training operation in Ukraine to assist our Ukrainian friends in being able to defend themselves and reduce casualties as they deal with Vladimir Putin's de-facto invasion of their country.
Mr. Chairman, the ability of the armed forces to contribute begins with a strong investment in defence.
In fiscal year 2005-06, National Defence spent $14.6 billion. In Budget 2006, we committed to raise baseline defence spending by $5.3 billion over five years, and that was incarnated in the 2008 Canada First defence strategy, which implemented the 2% annual defence escalator protecting the defence budget against inflation. It's the only department in the government that benefits from such a policy. And, most importantly, the baseline increase from the Canada First defence strategy has been used to acquire a whole new generation of equipment. It's been used to refit aging equipment and to modernize it, but also to acquire important new equipment. For example, the Royal Canadian Air Force now has a critically important strategic airlift capability. I just received in March our fifth C-17 Globemaster III.
Mr. Chairman, there was a time when if Canada wanted to respond to, let's say, to the tsunami in Southeast Asia in 2005, we had to go effectively begging from partners to lease a plane. I seem to recall we tried to send a C-130 across the Pacific and it had to turn back for repairs. That was the state of our ability to project ourselves abroad in case of emergency just a decade ago. But now, I was able to indicate to our military that we wanted to pre-deploy our humanitarian assistance and then the disaster assistance response team to help the people of Nepal, and within 36 hours we had Canadian troops on the ground with humanitarian equipment helping to save lives. That's why investments like this matter. There were five C-17 Globemasters, and in addition the very substantial new C-130J fleet that we have acquired for tactical airlift capabilities. All of these things by the way, including the two modernized Auroras that are now flying missions over Iraq, are aiding our military capability.
The refit and modernization of our Halifax-class frigates is fantastic. I invite members to visit some of our refitted frigates if they haven't done so. I was on the HMCS Calgary on Sunday last as part of Exercise Trident Fury. Really, we have world-class cutting edge capabilities aboard these frigates now, and as well there's the refit and modernization of our Victorial class submarines. Of course, there's also the modernization of our LAVs, our light armoured vehicles. There's the new M777 howitzer artillery pieces.
In addition to all of the equipment that we've successfully acquired or refitted in the past few years, I'm happy to advise the committee that the government will be investing $452 million to upgrade, replace, and modernize infrastructure on bases and wings across the country. I suspect that Minister Fantino has more to say about that.
All of this, Mr. Chair, is designed to maintain a flexible, capable military.
The main estimates were tabled in Parliament in February, and my department is seeking authority to spend $18.9 billion in 2015-2016.
This figure represents an increase in spending authorities of $280.5 million or 1.5% over the main estimates of last year.
I should point out that there were the mains, but as is usually the case, there was additional incremental spending in the supplementary estimates that totalled $20.1 billion at the end of the year. I would anticipate that will happen this year as well.
Interestingly, Mr. Chair, this year operating expenses for DND will be 8% higher than last year, but we will be spending less on capital expenditure authorities by some $700 million, primarily because equipment that we thought we would be taking possession of in this fiscal year, we either took early possession of or we believe we will be taking possession of in the next fiscal year. So there is always some margin for rescheduling the actual acquisition of equipment, and that changes the budget numbers on the capital side.
There is a slight reduction in grants and contributions of $9 million, primarily because all of NATO's contributing countries are reducing their transfers to NATO.
I'll close, Mr. Chair, by saying that we are doing hugely important work around the world right now, in eastern and central Europe, in Iraq and Syria, in Nepal, in Sierra Leone, and I want to thank the men and women of the Canadian Forces for doing us all proud in that work. With this budget we believe they will have the resources they need to do what we ask of them.
