Canada Faces ‘Massive Challenge' as NATO Eyes New 5% Spending Target: Expert
When representatives of NATO nations meet in The Hague late next month, they're expected to dramatically hike the alliance's defence spending target for members—the one Canada is failing to hit already.
At the last NATO summit in Washington last year, allies lined up to call out Canada for failing to meet the alliance defence spending target of two percent of national GDP.
When Prime Minister Mark Carney attends the NATO summit next month, he'll likely be under pressure to commit to a new defence spending target of five percent of national GDP.
'We're such an outlier now,' said David Perry, president of the Canadian Global Affairs Institute. He said Canada will face a 'massive challenge' in meeting the new target.
U.S. President Donald Trump has said for months he wants to see NATO countries increase their defence spending to five percent of GDP.
On Monday, NATO Secretary General Mark Rutte said he believes allied nations will agree at next month's gathering to a new target of five percent.
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Annual NATO data shows Canada is still failing to reach its current commitment; defence spending amounted to just 1.3 percent of GDP in 2024. Canada also failed to meet the alliance's target for equipment spending.
'The last time that there were reported stats, we were one of only two not meeting either (pledge). Everybody else meets at least one,' Perry said. 'We're increasingly, extraordinarily isolated in how far behind everyone else we are.'
Laval University international relations professor Anessa Kimball said Canada should be preparing to argue that investing more in the military becomes much harder in the middle of a trade war.
Kimball said Ottawa should prepare to leverage Trump's calls for higher military spending in the alliance and use that to press the case against his tariff agenda.
Kimball, who wrote a book on defence burden-sharing among NATO members, also said Carney may have a ready-made excuse for missing the NATO target.
As governor of the Bank of England, Carney was busy in the U.K. managing the economic fallout from Brexit when Justin Trudeau was in power and directing Canada's military spending.
'While I think that gives him an important level of macroeconomic credibility, it also gives him a little bit of an out. Essentially he can say, 'Trudeau and the Liberal Party left me a bit of a mess and they've known that they had to do this,'' Kimball said.
'Carney couldn't do worse at being convincing as Trudeau was. Trudeau was entirely unconvincing last year.'
At the 2024 NATO summit in Washington, after a series of U.S. politicians blasted Canada for failing to meet its commitments, Trudeau pledged to reach the two percent target by 2032.
His government suggested this could be done by buying up to 12 new submarines—a procurement project for which no deadline was ever given.
Trudeau said at the time that Canada's defence spending was based on its needs, 'not some nominal targets that make for easy headlines and accounting practices, but don't actually make us automatically safer.'
During the spring election campaign, Carney pledged to reach two percent by 2030.
'The government was elected on a strong mandate to rebuild Canada's defence capacity, rearm the Canadian Armed Forces and invest in the Canadian defence industry,' said Laurent de Casanove, a spokesperson for Defence Minister David McGuinty.
'The prime minister was clear that this government will invest to put Canada on track to exceed our NATO defence spending target before 2030.'
But Perry said Carney likely will have very little wiggle room at The Hague, even in a room full of allies who know he's new to the job.
'I think, unfairly for him, there's probably not a lot (of room),' he said. 'Even though he's brand-new, this commitment for Canada isn't. It's over a decade old.'
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'Since the late 2000s, when everyone had to tighten their belts, there has been increasing exasperation that some people are wrongly living off the fat of the land by claiming benefits they aren't due,' he says. 'While people get angry at cases of systematic criminal fraud, they can get just as angry at individuals they think just can't be bothered to work. It all adds up to this sense that nobody seems to be able to govern Britain properly. Inevitably, the anger at those milking or ripping off the system rebounds towards politicians.' Soon after winning the general election last year, Keir Starmer announced that cracking down on benefit fraud would be a priority for his government. In his speech to the Labour Party conference in September, he said that new legislation, following a policy mooted by the Conservatives, would let investigators 'root out' fraud with similar powers of 'search and seizure' to those enjoyed by HMRC. This would compel banks to hand over financial information about their customers where there was reasonable suspicion of benefit fraud. The plan was designed to save the taxpayer £1.6 billion over five years and free up more money for public services. Another proposal, announced in January, was to strip benefit fraudsters of their driving licences. Starmer's reforms have met with resistance. Neil Duncan-Jordan, who was elected the Labour MP for Poole last year, has proposed amendments to the bill that would ensure only those suspected of fraud would be surveilled. Writing in The Guardian, Duncan accused Starmer of 'resurrecting Tory proposals for mass spying on people who receive state support' and that under the proposed legislation 'welfare recipients would be treated as suspects, simply because they need support from the state'. The vast sums of money lost to benefit fraud are also an incentive for a government to crack down on it, to free up money for other projects. Recent comparative international studies are thin on the ground, but Britain might learn from Finland, a high-trust society with a relatively simple benefits system and high rates of digitisation, where fraud rates amount to less than half a percentage point of the total paid. According to the latest report by Kela, the Finnish welfare institution, there were 1,104 suspected cases of benefit 'misuse' in 2024, amounting to €7.2 million (£6 million); the number of cases has been stable over the past five years. In the UK, failing a cultural reversion away from seeking out every benefit you might be entitled to, Shalam believes technology might improve efficiency. 'Analysing and assessing all the information about people's claims and their condition takes a huge volume of human resource,' he says. 'There's a lot of potential in AI to crack down on fraud and make sure the system is going to those who need it most.' 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In attempting to mitigate Sara Morris's sentence, her lawyer Paul Cliff conceded that her application to the DWP 'did not give the full picture,' but that 'running was one of the ways she tried to manage her MS'. 'She lost her home because of financial problems,' he also said. 'And was struggling to keep her head above water financially.' As he tries to placate an increasingly angry electorate while balancing Britain's precarious books, Keir Starmer may sympathise with her. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
