Canada’s new military procurement process will reshape the Armed Forces: Senator Marty Deacon
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Procurement is not a word Canadians often associate with speed. Yet recent developments in this country’s approach to military procurement have been coming at a rapid clip, making it hard to keep up with announcements regarding new agencies and strategies.
This is, of course, encouraging. Successive Canadian governments had become complacent and arguably neglectful to the needs of our military. Events have snapped us out of this complacency and necessity has forced us to take military procurement seriously and quickly.
Out of the gate, this government — along with our NATO allies — committed to spending 5% of GDP on defence by 2035, with Budget 2025 proposing to provide $81.8 billion over five years on a cash basis to the Canadian Armed Forces (CAF). Given the prime minister comes from the private sector, I’m sure it was not his wish to set spending targets before getting a handle on what we need, but a message had to be sent to our allies that we would be taking collective defence seriously.
This thought comes with a great deal of risk. By having a target cost with a deadline, projects are open to waste and gold plating — adding costs to items to appease domestic spending targets and specific local economies. This is particularly worrying given that the government has tied so much of this procurement strategy to economic benefits in its Defence Industrial Strategy, with a target set at 70% domestic procurement.
The strategy was well received by industry as a much-needed signal that Canada is serious about building its industrial base, but it risks overpromising economic benefits to Canadians. The fact of the matter is there is much the CAF urgently needs that our industrial base cannot yet produce, and so it will have to be purchased off the shelf. These will not be home-grown companies and, while dollar for dollar matching investments in Canada are welcome and indeed encouraged, it must be communicated to Canadians and our NATO allies that these purchases are being made with defence, not economic needs, front of mind.
A critical piece to this will, of course, be the Defence Investment Agency. With a commitment to full transparency, this agency can streamline procurement while communicating to the public the rationale for these purchases. For now, the agency only covers purchases over $100 million — roughly 10% of foreseen military acquisitions. For the other 90% not covered by the agency, it is critical the executive level delegate authority on smaller projects in the public service to break the purchasing log jams we have seen in the past.
Ironically, it is this other 90% where the government can come close to delivering on its “made in Canada” target and see the most development of our domestic industry. Yet, historically, the Department of National Defence has not done so.
Many small and medium Canadian enterprises in the defence industry sell to our allies but not to us, and not for lack of trying. It is through these companies that we can buy Canadian immediately — where we can truly grow our domestic areas of expertise. At present, the majority of these purchases will not meet the spending threshold covered by the Defence Investment Agency, but they are crucial if we are to come close to this 70% domestic target.
Canada is embarking on a decades-long procurement process that will reshape our armed forces, a process that will certainly outlast any government. If successive parliaments are not to shift course, it is critical this government communicate that these purchases are first and foremost a means to enable the CAF to project itself abroad while keeping Canadians safe at home, not a jobs stimulus.
Industrial policy is a means to an end, not an end in itself. With clear communication and transparency, I am confident this path we have embarked on will see a renewed CAF ready to face the threats of the 21st century.
Senator Marty Deacon represents Ontario. She is chair of the Senate Committee on National Security, Defence and Veterans Affairs and a member of the Senate Committee on Foreign Affairs and International Trade.
This article was published in The Hill Times on May 25, 2026.
Procurement is not a word Canadians often associate with speed. Yet recent developments in this country’s approach to military procurement have been coming at a rapid clip, making it hard to keep up with announcements regarding new agencies and strategies.
This is, of course, encouraging. Successive Canadian governments had become complacent and arguably neglectful to the needs of our military. Events have snapped us out of this complacency and necessity has forced us to take military procurement seriously and quickly.
Out of the gate, this government — along with our NATO allies — committed to spending 5% of GDP on defence by 2035, with Budget 2025 proposing to provide $81.8 billion over five years on a cash basis to the Canadian Armed Forces (CAF). Given the prime minister comes from the private sector, I’m sure it was not his wish to set spending targets before getting a handle on what we need, but a message had to be sent to our allies that we would be taking collective defence seriously.
This thought comes with a great deal of risk. By having a target cost with a deadline, projects are open to waste and gold plating — adding costs to items to appease domestic spending targets and specific local economies. This is particularly worrying given that the government has tied so much of this procurement strategy to economic benefits in its Defence Industrial Strategy, with a target set at 70% domestic procurement.
The strategy was well received by industry as a much-needed signal that Canada is serious about building its industrial base, but it risks overpromising economic benefits to Canadians. The fact of the matter is there is much the CAF urgently needs that our industrial base cannot yet produce, and so it will have to be purchased off the shelf. These will not be home-grown companies and, while dollar for dollar matching investments in Canada are welcome and indeed encouraged, it must be communicated to Canadians and our NATO allies that these purchases are being made with defence, not economic needs, front of mind.
A critical piece to this will, of course, be the Defence Investment Agency. With a commitment to full transparency, this agency can streamline procurement while communicating to the public the rationale for these purchases. For now, the agency only covers purchases over $100 million — roughly 10% of foreseen military acquisitions. For the other 90% not covered by the agency, it is critical the executive level delegate authority on smaller projects in the public service to break the purchasing log jams we have seen in the past.
Ironically, it is this other 90% where the government can come close to delivering on its “made in Canada” target and see the most development of our domestic industry. Yet, historically, the Department of National Defence has not done so.
Many small and medium Canadian enterprises in the defence industry sell to our allies but not to us, and not for lack of trying. It is through these companies that we can buy Canadian immediately — where we can truly grow our domestic areas of expertise. At present, the majority of these purchases will not meet the spending threshold covered by the Defence Investment Agency, but they are crucial if we are to come close to this 70% domestic target.
Canada is embarking on a decades-long procurement process that will reshape our armed forces, a process that will certainly outlast any government. If successive parliaments are not to shift course, it is critical this government communicate that these purchases are first and foremost a means to enable the CAF to project itself abroad while keeping Canadians safe at home, not a jobs stimulus.
Industrial policy is a means to an end, not an end in itself. With clear communication and transparency, I am confident this path we have embarked on will see a renewed CAF ready to face the threats of the 21st century.
Senator Marty Deacon represents Ontario. She is chair of the Senate Committee on National Security, Defence and Veterans Affairs and a member of the Senate Committee on Foreign Affairs and International Trade.
This article was published in The Hill Times on May 25, 2026.