OTTAWA — The prospects for a significant increase in Canadian defence spending in the coming federal budget looked a little less likely as Prime Minister Justin Trudeau was set to head to Europe after announcing a stunning political deal with the New Democrats.

The Liberal government had been hinting that it was looking at aggressive options for injecting more money into the Canadian military in response to Russia’s invasion of Ukraine.

Canada has been under heavy pressure to meet the NATO military alliance’s target, set in 2006, of spending at least two per cent of its national gross domestic product on defence, as a growing number of allies have since promised to do.

Trudeau was largely noncommittal on Tuesday as he announced the new confidence and supply agreement with the NDP, which will see the fourth-place party support the Liberal minority government through to 2025 in exchange for new investments in other areas.

Those include the creation of a dental-care program for lower-income Canadians, national pharmacare, affordable housing and phasing out subsides for fossil fuels, among others.

The prime minister instead noted Canada’s recent promise to deploy more troops to eastern Europe as he prepared to fly to Brussels, where he will address the European Parliament on Wednesday before attending a NATO leaders’ summit on Thursday.

“I look forward to engaging with our partners at NATO and in Europe over the next couple of days,” he said.

Trudeau later spoke with Ukrainian President Volodymyr Zelenskyy before his planned departure later in the evening for Brussels. They talked about "further international assistance ahead of the upcoming NATO and G7 meetings," Trudeau's office said in a summary of the call.

"Both leaders called on Russia to stop targeting civilians, to withdraw its military forces from Ukraine, and to engage in diplomacy with Ukraine." 

Canada currently spends about 1.39 per cent of its GDP on the military, according to NATO estimates. That puts it in the bottom-third of allies. Many other NATO member countries have promised in recent weeks to rapidly ratchet up their spending over fears of Russia.

Asked whether his party would support an increase in defence spending in the coming budget, NDP Leader Jagmeet Singh said he was opposed to the two per cent figure and that any new investment in the military can’t come at the expense of his priorities.

“I don't think that will be the figure, and I don't think that's something we should do,” Singh said in French.

“The priority is to recognize that the Canadian Armed Forces deserve the resources and tools they need to do their work. … But what is our priority is that the government not cut health-care measures and other assistance measures to people.”

Two weeks ago in Berlin, Finance Minister Chrystia Freeland hinted there might be more money for the military in the coming federal budget.

Last week, Anand said in an interview with CBC's Power & Politics that she would propose a range of options for military spending to cabinet ahead of the federal budget, expected early next month, including some that could bring Canada in line with the NATO target.

"I personally am bringing forward aggressive options which would see (Canada), potentially, exceeding the two per cent level, hitting the two per cent level, and below the two per cent level," she said, adding that the "threat environment" had changed quickly.

Asked about Canada’s commitment to NATO during question period in the House of Commons on Tuesday, Anand did not mention the "aggressive options," but noted the Liberals’ promise in 2017 to spend billions of dollars on the military over the next 20 years.

But Foreign Affairs Minister Mélanie Joly, who has criss-crossed Europe herself in recent weeks, noted again on Tuesday that Germany has made a historic commitment to increase its defence spending to the NATO target of two per cent of GDP.

The spending commitment marked a radical shift in German military and foreign policy.

"Times have changed; the world has changed since Feb. 24, the date of the invasion by Russia of Ukraine. Germany decided to take a very important decision by increasing their military spending. And we take stock of that," Joly said.

David Perry, vice-president of the Canadian Global Affairs Institute and one of Canada’s foremost authorities on defence spending, said the deal between the Liberals and NDP raises serious questions about any major new investments in the military.

“If they are going to move forward with pharmacare, dental care or whatever manifestation that takes, it's presumably going to involve significant additional spending to make that happen,” he said.

“So where would defence spending fit into the overall fiscal picture? Given the state of the economy, state of the fiscal position, increasing interest rates, it further clouds what is already a reasonably unclear spending picture.”

Perry nonetheless said that actually meeting NATO’s two per cent of GDP target in the short term is largely unrealistic as it would require an additional $16 billion in military spending over the roughly $30 billion already spent each year.

Such an increase would also be virtually impossible to spend, given the long procurement timelines associated with buying new military equipment.

Perry said one obvious area that the Liberals could direct new funding in the budget would be on modernizing North America’s defensive systems, which the government has said is a priority but so far failed to act upon in a substantive manner.

This report by The Canadian Press was first published March 22, 2022.

Lee Berthiaume and Mike Blanchfield, The Canadian Press