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Defence Budgets  –  Defence Cuts Example  –  April 2011 $1.3 Billion Cut from Defence  —  Bleak Future Plans from the Dutch The 'wind down' of  the Canadian Forces'  combat mission  in Afghanistan brought out odd reactions in NDHQ planners. Some seemed to regard this war as an unwelcome interruption to their planning schedule. With combat coming to an end for CF troops, Ottawa planners could get back to the real job – preparing for less messy, largely hypothetical threat scenarios of  the future.  DND's budget – which would no longer need to be squandered on actual fighting – had been increased and regular future rises in that budget were all but guaranteed. Happy days!  But now flies keep appearing in that ointment.  Dutch Ministerie van Defensie experiences might be instructive. This month the details were announced of how Dutch government cuts to Defensie budgets will play out. Not long returned from their own Afghanistan deployment, the Dutch see little tangible results for their national effort.  Nor are they clear why  their post-Cold War military needs to remain as large as it currently is. To address this and a "worldwide financial crisis", Defensie has seen its budget cut by € 942.5 M or more than $1.3 Billion Canadian. Immediate cuts amount to € 617.5M ($853.8 M) followed by further near-term cuts of  € 175 M ($242 M), and another € 150 M ( $207 M ) in cuts later on.  All  this should give NDHQ planners pause. Politicians and bureaucrats in Ottawa would quickly assure citizens that Canada's economic situation is different from that of the Netherlands. That maybe so but it also matters what is being measured exactly. [1] The take-home is that the previous Canadian Government – one which will likely be re-elected – has promised to reduce its overall spending while increasing the military budget. Dutch government cuts total € 18 B (or almost $25 B) making their actual defence cuts a drop in the bucket. Anyone who doesn't believe that DND and the Canadian Forces face a similar (if distant) future is living in Cloud-Cuckoo-Land. Enjoy it while it lasts. Below is a slightly edited version of the Defensie news article. The original is available here. [1] In the last reporting period (2009-2010) Canada’s debt-to-GDP ratio was 37%. The Dutch debt/GDP is 467%. In the same period, Canada's public deficit was $53.8B (3.5% of GDP), the Dutch government deficit in 2010 was € 31B ($59.2 B, 5.4% of GDP ). So Canada looks good. When public debt  is examined,  the effect is slightly different. The Netherlands had a gross debt of over € 388.65 B or $537.062 B. But the Canadian gross debt for 2010 was not that far behind, hitting almost $520B in 2010.  After the 2008 meltdown, Canadian politicians became downright smug about our national aversion to risk.  Works for banks, what about exports? Compare the Netherlands with Canada again. In 2010, the Dutch trade surplus hit € 22.1 B or $30.54 B. Canada's trade deficit almost doubled in 2010, hitting $9 B while growing monthly. That poses the question: in the absense of trade surpluses, what pays for projected $191 M increases to the FY 2011/2012 DND budget (scheduled to jump from $21.102B to $21.293B) ? Netherlands' Defence organisation hit hard by cutbacks 14 April 2011 The Netherlands Defence organisation has been hit hard by the cutbacks announced today by Dutch Defence Minister Hans Hillen. The following is a brief outline of the key measures: Cutbacks amounting to € 617.5M will be made in administration and management, support and operational logistics. That amounts to 64 percent of the total amount. The staffs will be reduced by 30 percent, and administrative and management relations and processes will be simplified. The number of top-level positions will be reduced from 119 to 80. One thousand civilian service cars will go, and VIP transport will be scaled down. The Royal Netherlands Navy will reduce the number of  [ Alkmaar class ]  minehunters from 10 to 6.  Two of  four new [ Holland class ] ocean-going patrol vessels will not be taken into service. One of the two supply ships will be phased out. [ The replenishment ship ] HNLMS Zuiderkruis will be taken out of  service at the end of  2011, after its planned deployment as part of  the EU operation Atalanta. [A second replenishment ship ] HNLMS Amsterdam will remain in service until 2014 and will be replaced by the Joint Supply Ship [ JSS aka JLOS ]. Two tank battalions [TKbtn] of the Royal Netherlands Army will be disbanded. In addition, a reduced number of self-propelled howitzers [PzH2000NL] will be brought together with the [HB Rayé towed] 120mm mortars under a single field artillery battalion, and the construction engineers and armoured engineers capability will be reduced, as will air defence capabilities and the number of Medium-Range Antitank systems [Rafael Gill/Spike ATGM] on Fennek vehicles.  The maintenance capability will also be decreased.  Personnel reductions at  the headquarters of  the [ joint 1 (German/Netherlands) Corps ]  will be agreed with Germany. The Royal Netherlands Air Force will reduce its number of F-16s from 87 to 68. The Cougar transport helicopters will be phased out and the third DC-10 [as opposed to KDC-10 tanker] won't be taken into service. The air force will also disband two Ground Installation Defence platoons and one of  the four Patriot [AD missile] batteries will be taken out of service. The Royal Netherlands Marechaussee [ KMar paramilitary and ports police] will cancel the purchase of the vessel intended for use in the Zeeland waters. As a result of the reduction of the armed forces, the RNLM police tasks for the armed forces will also be reduced. [...] These measures are the result of the worldwide financial crisis. The Dutch government has to reduce spending by € 18 B,  € 635 M of which must be saved by the Ministry of  Defence. In addition, the Defence organisation must cut back an additional € 175 M, and further € 150 M over the longer term, in order for the Defence budget to become financially sound again.