Ireland cuts budget for 2011

“In 2011 the Department of Defence and the Defence Forces, like all areas of the public service, will operate on a reduced budget. The gross allocation in 2011 for Defence and Army Pensions combined is EUR 933m, an overall reduction of 4% on the 2010 allocation. Defence spending at EUR 725m (including capital spending) will be down by EUR 30m (4%) on the 2010 Estimate. The provision for Army Pensions (Vote 37) for 2011 is EUR 208m, which is a non-discretionary expenditure.

Vote 36 (Defence) and 37 (Army Pensions)



The expenditure reductions will be delivered through the reduction in participation in overseas peacekeeping, particularly the withdrawal from Chad and the reductions in numbers serving in Kosovo and Bosnia- Herzegovina. Savings will also be achieved through the postponement of expenditure on equipment and capital works across the Defence Forces.

There are currently 2 aircrafts available for the Ministerial Air Transport Service. The Gulfstream IV aircraft is in service for almost 20 years and no provision has been made in the Estimates for a replacement or for any major structural repair. The Learjet aircraft will continue in operation.

While there have been reductions in the overall Defence budget, steady investment since 2000 means that the Defence Forces are well placed in addressing the challenges for 2011 and the adjustments required under the National Recovery Plan.

The procurement of two new naval vessels will continue within the reduced allocation for Defence spending.

All of the main savings indentified in the Special Group on Public Service Numbers and Expenditure Programmes have already been implemented or alternative savings identified.”

“The priority in the coming year will be on maintaining the capability of the Defence Forces to deliver effective services across all of the roles assigned by Government.

Ireland remains open to participation in peace keeping operations with such participation reflecting the reduced budgetary resources. The Defence Forces retain the capacity to deploy overseas. No decisions have been made by the Government in relation to new peace keeping operations.” added Minister Killeen.

Sri Lanka Spending $1.9B in 2011

COLOMBO, Sir Lanka -The Sri Lanka government has allocated SLR215 billion ($1.92 billion) for defense for 2011, amounting to 20 percent of the national budget and representing an increase of 6 percent over last year's budget. Much of this budget is due to large installment payments on military hardware bought over the years. These will continue to dominate the military budget for some time.
As usual, the 200,000-strong Sri Lanka Army will absorb just over half of the entire defense spending to maintain its personnel. A substantial proportion of this will be spent on new bases and cantonments needed to accommodate troops in the northern and eastern provinces, replacing the existing makeshift shelters.
Also acting to increase the defense budget is the consolidation of a number of paramilitary budgets from other ministries into the Ministry of Defense.

S Korea approves 6.2% increase for defense in 2011

South Korea’s parliament approved plans to increase spending next year by 5.5 percent to 309.1 trillion won ($270 billion).
Lawmakers from the ruling Grand National Party approved the budget in a televised session of the National Assembly today, allocating 500 billion won less than a September proposal by the government.
Members of the opposition parties including the Democratic Party tried to block passage after the GNP earlier today approved the bill at a subcommittee without their participation.
South Korea plans to increase spending on defense by 6.2 percent to 31.4 trillion won next year to bolster military readiness to respond to any provocation by North Korea. The increase is higher than the 5.8 percent initially planned by the government.

France Defense spending Cuts for 3yrs

Paris - France confirmed on Sept. 29 an announced cut in defense spending of 3.6 billion euros ($4.8 billion) over the next three years, as government officials said the effects would be "very limited" because of receipts from the sale of property and digital frequencies.

The defense officials drafting the military budget law factored in export contracts for the Rafale fighter jet from Dassault Aviation, but as no such deals have been signed, the government must find 800 million euros over the three-year period to buy (DASSAULT)

The military is contributing to the government's attempts to reduce the public deficit but defense remains a priority for the state, the officials said.

The planned asset disposal would partly compensate for the budget cut, leaving a shortfall of 1.26 billion euros compared with the figure in the multiyear military budget law adopted in 2009, a government official said.
"It's less euphoric but it's in line with the military budget law," the official said.
Total spending under the 2009-14 military budget law was set at 185.9 billion euros at 2008 prices, of which 101.9 billion was earmarked for equipment.
Despite the reduction over the three years, defense spending will climb each year from 2011, which was not the case in other government departments, the official said.
Under the new three-year budget, equipment spending will be 16 billion euros in 2011, 16.8 billion in 2012 and 17.04 billion in 2012.
The military budget law set 16.04 billion euros for 2011, 16.41 billion in 2012 and 17.02 billion in 2013.
Equipment spending hit a record 18 billion euros in 2009 under a bow wave effect as equipment which had been under development for years finally hit the production and delivery stage. That total eased to 17 billion in the current year.
The defense officials drafting the military budget law factored in export contracts for the Rafale fighter jet from Dassault Aviation, but as no such deals have been signed, the government must find 800 million euros over the three-year period to buy the aircraft needed to maintain production at an annual 11 units.
The Defense Ministry confirmed that part of the savings will come from postponing the midlife upgrade and conversion of the Mirage 2000-D fighter-bomber to an air defense variant, an order for 14 multirole tanker and transport aircraft (MRTT), and elements of the Scorpion Army modernization program.
An order for the MRTT will come back for review in 2012 or 2013. French officials are negotiating with their British counterparts for a possible lease of the tanker jets being acquired under the future strategic tanker aircraft program for the Royal Air Force. But the lease terms being offered are too expensive, a French official said. If a cooperative deal is reached, it would be announced at the Anglo-French summit to be held in November.
The government published on Sept. 29 the defense spending figures which will go to the National Assembly in the autumn for voting.

UK MoD 2010 Data

http://www.dasa.mod.uk/modintranet/UKDS/UKDS2010/pdf/UKDS2010.pdf

Netherlands Defense Budget Projection

2.1 Uitgaven begrotingen (in miljoenen euro)
              2009     2010          2011        2012         2013         2014       2015

Defensie  8 733     8 514          8 459        8 224         8 217         8 254        8 236 http://miljoenennota.prinsjesdag2010.nl/miljoenennota-2011/Search.ZGVmZW5zaWU=/aDU1053_2-De-uitgaven-en-niet-belastingontvangsten.aspx

UK Defence Budget Cut By 8%

The Government has today agreed funding for Defence of £33.8bn in 2011-12, £34.4bn in 2012-13, £34.1bn in 2013-14 and £33.5bn in 2014-15. This settlement represents an eight per cent reduction in real terms.

This agreed funding is part of the Government's 2010 Spending Review which has been announced by the Chancellor today.

The Spending Review set out to allocate resources to Government Departments according to the Government's priorities.

The 2010 Spending Review covers the four years from 2011-12 to 2014-15.

The Spending Review has been run concurrently with the Strategic Defence and Security Review (SDSR), bringing defence plans, commitments and resources into balance so that we have a coherent defence capability and a sustainable defence programme for the future.

At least £4.3bn of savings will be made in non-front line activities over the Spending Review period. The MOD's administration costs will also reduce by 33 per cent over the period.

Defence Secretary Dr Liam Fox said:

"The SDSR has reshaped our Armed Forces to tackle future and emerging threats. We now also know how much money we will have to carry out the vital job of protecting Britain's national security.

"This will enable us to bring defence policy, plans, commitments and resources into balance so that we can emerge with a coherent and affordable defence programme for the future."

Azerbaijan to nearly double spending in 2011

BAKU - Azerbaijan is to nearly double its defense spending next year, the finance minister said Oct. 12, amid rising tensions in its conflict with Armenia over the rebel Nagorny Karabakh region.
Finance Minister Samir Sharifov told parliament defense spending under the country's 2011 budget would rise 89.7 percent to 2.5 billion Azerbaijani manats ($3.1 billion).

"Defense spending in 2011 will account for 19.7 percent compared with 10.7 percent in 2010, so the share of defense spending in the budget will almost double," he told lawmakers considering next year's draft budget.
Nearly 1.1 billion manats ($1.4 billion) of the spending will be used to modernize the Azerbaijani military through the purchase of up-to-date equipment and weaponry, he said.
Sharifov said more money would also be allocated for the development of Azerbaijan's defense industry but did not elaborate.
Locked in a long-simmering conflict with Armenia over Karabakh and awash in revenues from energy exports, the former Soviet republic of Azerbaijan had already nearly doubled defense spending in the previous two years.
Ethnic Armenian separatists backed by Yerevan seized control of the Nagorny Karabakh region during a war in the early 1990s that left an estimated 30,000 dead and the region remains outside Azerbaijani control.
Tensions over Karabakh have been increasing this year amid stalled peace talks, with the number of deadly skirmishes along a cease-fire line on the rise for months.
At least 18 soldiers on both sides have been reported killed in clashes this year, including eight soldiers killed last month alone.

Russia increasing spending thru 2013

NEWTOWN, Conn. --- Russian has released new defense spending details. The State Duma Defense Committee has announced that the nation's defense spending, including research and development (R&D) spending, will total $16.3 billion (RUB487 billion) in 2010, $19.2 billion (RUB574 billion) in 2011, $24.3 billion (RUB726 billion) in 2012, and $38.8 billion (RUB1.16 trillion) in 2013.

While total defense spending will increase, the amount allocated for R&D will drop from the current 2010 level of 22 percent to 16 percent by 2013. The modernization of weaponry will instead receive a significant portion of total spending, with 13 percent designated for the 2010 fiscal year, 15 percent for 2011 and 2012, and 14 percent for 2013.

The top procurement priorities are the following:

-- RS-24 intercontinental ballistic missiles,
-- Bulava submarine-launched ballistic missiles,
-- Su-24 fighters,
-- Su-35 long-range fighters, and
-- submarines, corvettes, frigates, and battlefield command-and-control systems.

In September, Defense Minister Anatoly Serdyukov said that the government intends to spend RUB19 trillion ($613 billion) over the next decade to modernize the armed forces.

The current plan for 2010-2013 only represents a small portion (16%) of that amount, just over RUB2.9 trillion ($98.6 billion).

UK Cuts Likely less than Expected

LONDON — Although the U.K. defense
industry is still bracing for
significant program cuts when the
government’s strategic and spending
review is revealed next week,
there are growing indications the
calamitous reductions once feared
will not materialize.
At one point, defense industry
representatives were bracing for
cuts in defense spending well above
20% of current outlays, but recent
indications are that the figure will
be less severe. A cut in spending of
10% or less is now expected, several
industry officials say.
But a senior industry representative
warns that this does not mean
critical program cutbacks will not
Finoccur.
Speaking at the C onservative
Party congress recently, Prime Minister
David C ameron said “some big
changes” are ahead.
Defense Secretary Liam Fox gave
little indication of what may be cut.
However, he did affirm the Trident
nuclear submarine replacement
program would be funded (Aerospace
DAILY, Oct. 7).
Industry officials also now expect
the aircraft carrier shipbuilding
program may survive unscathed,
partly because the cost of canceling
the two vessels would be too high.
However, if both are built, the U.K.
is considering holding the second in
reserve, thereby reducing the need
to fully equip and crew the vessel.
One of the implications is expected to be a cut in the
planned purchase of Lockheed Martin F-35s from the
138 currently planned for the Royal Air Force and Royal
Navy. The program is called the Joint C ombat Aircraft
in Britain.
Another program identified as potentially vulnerable to
cuts has been the Nimrod MRA4 maritime patrol fleet. But
a military official involved in the project expresses confidence
the program will survive, with an industry official
adding it would be hard to believe the aircraft would not
be fielded given the billions of pounds sunk into its development
phase.
Top government officials in the National Security C ouncil
have been convening to try to finalize where the cuts
should fall. That includes what elements of the existing
fighter force, the Tornado GR4 and Harrier fleet, to draw
down early.
Even if there are indications the scale of the budget
reduction will be less than first feared, that is
not to say there is not still anxiety in the sector. Britain’s
large Unite union is warning the U.K. could lose
more than 16% of its defense workforce as a result of
planned spending cuts due to emerge. The union cites
an Oxford Economics study that suggests “that cuts of
26% would lead to potentially over 55,000 [job] cuts
in the U.K.”
“The Tory-led coalition wants to raze the U.K. defense
industry to the ground,” says Unite’s national officer for
aerospace and defense, Bernie Hamilton. He added that
“tens of thousands of job cuts in some of Britain’s most
deprived regions will have tragic consequences. These
skilled manufacturing jobs won’t get replaced.”
The union figures suggest that a spending reduction
of 10% would mean the loss of 18,878 defense industry
jobs and another 15,314 in the supply chain. A cut of 20%
means a total of 55,230 jobs would disappear, around
30,492 directly in the defense industry and 24,738 in the
supply chain.

Australia up 5.3% for 2010-11

SYDNEY, Australia - Australia will escape the worst effects of last year's global financial crisis, and the government of Prime Minister Kevin Rudd has kept its promise to maintain defense spending by increasing Australia's defense budget from 24.4 billion Australian dollars ($22.04 billion) in 2009-10 to 25.7 billion Australian dollars in the next year.
"Of Australia's 18 years of continuous economic expansion, Australians can be proudest of the one just passed," Australia's treasurer, Wayne Swan said May 11, unveiling the federal budget for the 2010-11 fiscal year to the Parliament in Canberra. "Together, Australians have defied global economic gravity, not by accident, but by choice."

However, money is still tight, said Sen. John Faulkner, the country's defense minister. The Strategic Reform Program (SRP) his predecessor Joel Fitzgibbon initiated in 2009 will continue. The SRP is designed to reap an efficiency dividend of some 20.6 billion Australian dollars over the decade to 2019, or about 8.5 percent of the budget.
In 2009-10, the SRP harvested 797 million Australian dollars in savings, Faulkner said; his 2010-11 budget aims to top the billion-dollar mark.
The money saved will be reinvested buying combat equipment set out in his department's Defence Capability Plan (DCP), a 10-year rolling blueprint for Australian defense procurement.
The new budget contains no surprises as far as equipment is concerned. Australia's defense procurement agency, the Defence Materiel Organisation, will spend 6.08 billion Australian dollars on new equipment in 2010-11.
Major procurements scheduled for funding approval this year include:
■ An estimated 3.5 billion Australian dollars for 24 new naval combat helicopters to replace the Navy's 16 aging S-70B Seahawks.
■ A new Tactical UAV system for the Army, for which Faulkner's department has requested two AAI-built Shadow 200 systems under a U.S. federal military sales agreement worth an estimated $218 million.
■ 1.1 billion Australian dollars worth of protective equipment for Australian troops in Afghanistan, to be acquired between 2010 and 2013. The biggest single chunk of this, 437 million Australian dollars, will be spent in the coming fiscal year on a new counter-rocket, artillery and mortar "sense-and-warn" capability, Faulkner announced.
"Australian forces in Afghanistan currently face a very high risk from both insurgent operations and improvised explosive devices [IEDs], and a high risk from indirect fire," Faulkner said.
This billion-dollar investment in force protection capabilities includes direct protection for Australian Defence Force members from small arms, IEDs and indirect fire, he added. Additional measures include improved route-clearance capabilities, enhanced protection and firepower for Protected Mobility Vehicles, new night fighting equipment, improved body armor and improved intelligence and reconnaissance capabilities.
The budget also allocates 1.1 billion Australian dollars to fund ongoing operations in Afghanistan and the wider Middle East (including ships in the Arabian Gulf), Solomon Islands and East Timor, as well as enhanced coastal surveillance to deter or detect people smugglers, terrorists and organized criminals.
The coastal surveillance effort also will be enhanced, with the Australian Customs and Border Protection Service receiving the green light to replace its eight aging 38-meter Bay-class patrol boats with a new fleet of boats under a 1.2 billion Australian dollar boost to coastal protection.

New Zealand 2011 Flat

New Zealand's Defence Force (NZDF) will receive a modest increase to 2.85 billion New Zealand dollars ($1.89 billion) for the 2010-11 fiscal year, up from 2.83 billion New Zealand dollars, but the Ministry of Defence budget will fall to 239 million New Zealand dollars from 325 million the previous year.
The Army continues to absorb the largest budget slice at 843 million New Zealand dollars, up from 791 million New Zealand dollars; the Navy receives 673 million New Zealand dollars (634 million the previous year); and the Air Force sees its budget rise from 612 million New Zealand dollars to 643 million.

In a statement, Defence Minister Wayne Mapp said, "We have to fund sharply increased depreciation and operating costs. In terms of personnel, the Defence Force is shifting more resources to the front line. Our priority is to ensure the money is spent on the service people who are deployed on operations."
Priorities notwithstanding, that portion of the 2010-11 defense budget earmarked for "Operationally deployed forces" has been reduced from 95.6 million New Zealand dollars to 78.4 million.
Budget documents detailed key military and Defence Ministry priorities for the coming year.
Foremost is completion of the current Defence Review, which was scheduled to be released in March but is now expected in September, with the focus on "how well the NZDF meets the tasks that are expected of it by the Government."
Other key priorities include:
■ Ensuring the NZDF remains effective and responsive so that current operations, both international and domestic, are effective and sustainable.
■ Consolidating and creating new opportunities with Australia in developing complementary military capabilities, particularly in the areas of air transport, response forces for the South Pacific and the defense industry.
■ Effective management of acquisitions by raising the capability of procurement agencies, ensuring that a whole-of-life approach is taken, and looking for solutions that meet reasonable expectations.
■ New resource management methods to ensure that "value for money is evident in and pervades Defence."
Mine countermeasures spending also is down, from 26.5 million New Zealand dollars to 24.8 million.
However, funding for both the Navy's Seasprite helicopters and for the Patrol Force - four new inshore patrol vessels and two new offshore patrol vessels - has increased by about 5 percent and 25 percent, respectively. The latter increase reflects the introduction to service of the six new ships in the past year.
The Air Force P-3K Orions enjoy a slight increase in spending, to 179 million New Zealand dollars, while the fixed-wing transport fleet, including Hercules and 757s, climbs gently from 228 million to 244 million New Zealand dollars.
The budget for Special Forces increases too, from 67 million to 71 million New Zealand dollars, although the Security Intelligence Service has had its budget reduced by some 2 million to 36 million New Zealand dollars.

Germany Draft Budget Up 1.4% in 2011

BERLIN - German military spending would rise to 31.54 billion euros ($41.2 billion) in 2011, up 438 million euros or about 1.4 percent from this year, according to the draft budget presented Sept. 14 by the government to parliament.
Various committees and the parliament's upper house will discuss the budget and vote on it in December.

In the budget debate Sept. 15, Defense Secretary Karl Theodor zu Guttenberg stressed once again the need to shrink and restructure the military.
Zu Guttenberg said 163,500 soldiers is the smallest the military should be if it is to perform a leading role in NATO and the European Union, protecting Germany and being ready for deployments abroad.
Personnel costs would come to 16.53 billion euros, more than half of the total. That includes 454.6 million euros for pay and benefits for about 55,000 conscripts.
Procurement spending would rise from 5.07 billion euros this year to 5.23 billion next year. That includes 565 million euros for the A400M transport plane, 1.25 billion euros for the Eurofighter jet fighter and 87 million euros for the Puma infantry fighting vehicle.
Some 2.18 billion euros are scheduled for Bundeswehr's general operations. That includes operating costs for the nine foreign operations Germany is currently participating in, which will run 831 million euros, including 231.7 million euros for troops' deployment bonuses.
Maintenance costs are to rise from 1.99 billion euros this year to 2.03 billion euros.

France Down 6.2% in 2011

LONDON — France is facing the prospect of real capability gaps as the country adjusts its defense spending to try to bring down its mounting budget deficit.
As part of its first concrete action, the government announced Sept. 29 it plans to curtail defense outlays by €1.3 billion (U.S. $1.77 billion) over three years. The move, expected for months, is nonetheless significant because it reverses several years of increasing defense spending, even if only modestly at times.
But military officials worry the cutback is merely a first step. For instance, the French air force was hoping to start fielding a midlife update for the Mirage 2000D soon. That program has now been delayed and is not planned to emerge until 2017-18. One senior military official is concerned the program may never emerge.
Other programs that were expected to begin next year are the acquisition of 14 new air tankers and the start of acquisition of a Ceres signal intelligence satellite system.
The Mirage 2000D delay could lead to a capability gap after the retirement of the Mirage F1, with its Astac tactical electronic intelligence pod. The Astac pod was to transition to the Mirage 2000D at the time of the midlife upgrade, but now discussions are underway on whether the Rafale’s Spectra electronic warfare suite could be upgraded to take on the task. In either case, a capability gap will exist, the official says.
The new French spending plan calls for annual buys of 11 Rafales per year for both the navy and the air force. Next year’s deliveries should bring the fleet to 104 units handed over. Delivery of six more Reco NG reconnaissance pods for Rafale also are planned — the system is set to make its combat debut in Afghanistan next year.
The 2011 budget calls for spending of €30 billion, increasing by around €500 million in each of the two following years. Equipment spending is planned at around €16 billion, down from €17 billion last year. It is due to increase in 2012 to €16.8 billion and reach €17.4 billion in 2013.
Much of the focus of new orders in 2011 will be on upgrades and maintaining existing equipment. The spending plan calls for funding modernization of three C-135 tankers, made necessary in part by the delay in moving forward on the refueling aircraft acquisition. Two Falcon 50s will also be modified into maritime patrol aircraft and seven Cougar helicopters are also to be overhauled.
Next year should also see the first French delivery of a NH90 helicopter in the TTH transport configuration for the army, plus the delivery of four more NFH90 maritime helos — the first were handed over this year — which also are to become operational in 2011. Six Tiger attack helos also are due for delivery.
Other equipment highlights for 2011 include the redelivery of an upgraded C160 Gabriel signals intelligence aircraft and two upgraded E3 Awacs.
In the missile arena, 2011 should see the final ASMPA nuclear tactical missile handed over, as well as delivery of 70 MICA air-to-air weapons, two SAMP/T air- and missile defense systems, and 100 Aster 30 and 10 Aster 15 missiles.
France also is maintaining its military space activities, a focus area in recent years, despite the Ceres delay. An extra 60 Syracuse III terminals are to be delivered, and final funding will be provided for two new optical imaging satellites for the Musis program.
Industry also will benefit from €2 billion in stimulus money to be funded by a special bond issue. About €1.5 billion will go to support new civil aircraft and helicopter developments and the rest is for an Ariane 5 launch vehicle follow-on and new satellite developments.

Norway 2011 Budget

The Government proposes continuing investment in the Armed Forces in 2011 with a defence budget of NOK 39,249 million. Increased activity, new materiel and security in the High North will be given priority.

Increased funding and new efficiency measures in the Armed Forces will in fact represent a strengthening of the defence budget in excess of NOK 300 million.

Clear priorities

“This is a good, but tight, budget with clear priorities. We are giving priority to receiving and bringing into service new aircraft, helicopters and naval vessels. And Norway’s military presence in the North – the Armed Forces’ contribution to the Government’s High North Strategy – will be strongly maintained,” says defence minister Grete Faremo.

The budget proposals will provide increased naval activity, the continuing build-up of Army personnel and the phasing in of new transport aircraft. In addition, the Government proposes to strengthen funding for the security of Norwegian forces in Afghanistan, Home Guard training activities will be substantially expanded and the capabilities of the Coast Guard will be improved. All together, these priority measures reflect the strengthened focus on the northern areas. All this is in line with the provisions of the Long-Term Plan.

The Government will continue to maintain Norway’s contribution to international peace and stability at a high level, with the Norwegian force contribution to Afghanistan as its most important commitment. The work of looking after the rights of veterans remains a high priority.

The strengthening of high priority areas also means, however, limiting the time at sea for naval vessels other than the Fridtjof Nansen and Skjold classes, reduced activity for some of the Air Force systems and a tight budget for the Defence Logistics organisation.

Increased freedom of action

The Government’s proposals entail an increase in funding for the work set out in the Long-Term Plan for the Armed Forces 2009-2012 of a further NOK 75 million in 2011. At 2008 prices the funding allocations for the years 2009-2011 will be increased by NOK 547 million out of the NOK 800 million envisaged in the Long-Term Plan as the goal for 2012. “Both the Government and the Norwegian Armed Forces are well advanced in the implementation of the Long-Term Plan and the principal objectives are within reach,” says the Defence Minister.

Freedom of action in following the Long-Term Plan is supplemented in total by something in excess of NOK 300 million due to the Armed Forces’ internal efficiency measures which amount to approximately NOK 230 million.

Budget facts

The defence budget is increased by NOK 4,318 million. Of this amount, NOK 3,448 million stems from a technical transition from net to gross budgeting for the activities of the Norwegian Defence Estates Agency, while NOK 970 million arises from pay and prices index adjustments and other technical changes.

The funds allocated for the normal activities of the Defence sector increases by NOK 75 million in real terms in 2011. The operating budget amounts to NOK 29,259 million, a reduction of NOK 174 million (-0.61 percent). This reduction, however, is due to the fact that, in 2010, special supplementary allocations were made to cover the UN operation in Chad and the EU’s maritime operation off the coast of Somalia which were both completed in 2010.

In real terms, therefore, the ordinary operating budget for 2011 represents an increase compared with 2010. The Government is proposing a total investment budget of NOK 9,990 million, representing an increase of NOK 73 million (+0.75) in real terms compared with the consolidated budget for 2010.

The Government proposes the allocation of NOK 1,187 million to Norwegian forces overseas. Afghanistan remains Norway’s main international commitment. Here Norway has responsibility for leading ISAF’s stabilisation team in Faryab province. The main focus will continue to be on strengthening the ability of the Afghans to take responsibility for their own stability and security. The funding for Afghanistan will, because of a deterioration in the security situation, in fact be increased by NOK 77 million in relation to the consolidated budget for 2010.

In 2011 Norway will contribute the sum of USD 10 million to NATO’s ANA Trust Fund in support of the Afghan National Army. As part of the international community’s fight against piracy, a number of countries are contributing to the anti-piracy operation around the Horn of Africa. The situation is being kept closely under review and the possibility cannot be excluded that Norway may be asked to contribute again to the anti-piracy operation.

The Government proposes a funding allocation of NOK 5,289 million for the Norwegian Army. Through an increase in funding in real terms combined with the freeing of resources internally, the Army’s funding represents an increase of NOK 206 million compared with 2010. The Army’s additional expenses in connection with operations abroad are included. The way is being prepared for an increase in the manpower available to the brigade in North Norway. Since 2006, Army numbers (full-time equivalent) have increased by around 1,100 (about 50 percent) and this trend is set to continue in 2011. It is anticipated that the build-up of personnel and the increase in exercise activity will continue beyond 2011.

The Government proposes a funding allocation for the Royal Norwegian Navy, excluding the Coast Guard, of NOK 3,282 million. Through an increase in funding in real terms combined with the freeing of resources internally, the Navy’s funding represents an increase of NOK 81 million in total compared with 2010. This strengthening of the Navy’s budget will be directed towards an increase in sea time for the Navy’s new vessels and an enhanced capability to provide a naval presence in northern waters. In addition, the upgrading of mine countermeasures vessels and Ula class submarines will continue.

The Norwegian Navy’s operational capability will be strengthened in 2011, but the priority assigned to implementation of the new structure means that it will be difficult to maintain 2010 levels of activity for the other classes of vessel. It is proposed that the training of naval recruits should continue to be based at Madla.

The Government proposes a funding allocation for the Royal Norwegian Air Force of NOK 3,968 million. Through an increase in funding in real terms combined with the freeing of resources internally, the funding allocation for the Air Force represents an increase of NOK 89 million in total compared with 2010. The introduction of the C130J transport aircraft and the test programme for the NH-90 maritime helicopters will continue to take place at Bardufoss. The level of activity for combat aircraft, maritime surveillance aircraft, aircraft used for electronic warfare purposes, and the Norwegian MEDEVAC helicopters deployed in Afghanistan, will continue as at present but the level of activity for other Air Force systems may be somewhat lower.

The northern regions will continue to be given priority where aircraft operations are concerned. A specially adapted detachment of NH-90 helicopters will be established at Haakonsvern naval base in Bergen to provide support for the frigate force and the Coast Guard in South Norway.

The Government proposes a funding allocation for the Norwegian Coast Guard of NOK 978 million. Through an increase in funding in real terms combined with the freeing of resources internally, the funding allocation for the Coast Guard represents an increase of NOK 47 million in total compared with 2010. The structure of the Coast Guard’s fleet has been modernised and in 2011 the Coast Guard will have 14 modern vessels at its disposal. In order to ensure optimum utilisation of the new vessels in the Outer Coast Guard, one of the Inner Coast Guard vessels will be withdrawn from patrols in southern Norwegian waters in 2011. The Commander of the Norwegian Coast Guard, with the associated staff functions, will move to Sortland in Nordland county, currently the Coast Guard’s northern base, to form a single integrated operational Coast Guard command centre.

The Government proposes a funding allocation for the Norwegian Home Guard of NOK 1,049 which represents a real increase of NOK 8 million compared with 2010. Training in the regional structure will be extended from 20 percent in 2010 to 38 percent in 2011. In addition, about 90 percent of the rapid response force will receive training in 2011. Taken together, these measures will strengthen substantially the operational capability of the Home Guard. Some minor adjustments in the organisation of the Home Guard will be made to strengthen the emphasis on high priority activities. The Inspector General of the Norwegian Home Guard , together with the associated staff functions, will relocate to Terningmoen. This move to Terningmoen, close to the Østerdal garrison and the Norwegian Army’s Centre of Competence, will provide the staff with access to stronger professional support.

Funding allocated to the Norwegian Defence Logistics Organisation (NDLO) has been reduced by NOK 104 million in order to strengthen the financing of high priority activity in the Armed Forces. Even so, the Defence Logistics Organisation will deliver operational capabilities that meet current requirements. Savings within NDLO include some curtailment of the scheme under which service personnel are eligible for free travel. This adjustment brings the Armed Forces more closely into line with other public sector organisations. This will not affect travel where there is a legal entitlement.

The Head of the Defence Information Infrastructure Command (INI) is assumed to be able to maintain the organisation’s activity at 2010 levels. Steps are being taken to strengthen the Communication Information System Task Group, to better support force contributions planned for 2011. The Head of INI, together with the associated staff functions, will move to Jørstadmoen at Lillehammer and will be co-located with the Armed Forces Centre of Competence for Command, Control and Information Systems. The move to Jørstadmoen will, by bringing together INI and related training activities and operational force production, make a positive contribution to the process of moving towards a network-based defence as well as enhancing the operational capability of the Armed Forces as a whole.

The budget for Norwegian Military Music is increased by NOK 1 million compared with the consolidated budget for 2010, allowing for the fact that the Norwegian Military Tattoo takes place in alternate years and not in 2011. Priority will be given to internal ceremonial activities within the defence sector.

The Government proposes a materiel investment budget of NOK 8,132 million for 2011. The greater part of the materiel investment funding will be devoted in 2011 to ongoing projects in which deliveries have already commenced. This includes payments in connection with Fridtjof Nansen and Skjold class vessels, new helicopters for the Coast Guard and the frigates, new transport aircraft, new artillery systems and the upgrading of F-16 combat aircraft and Ula class submarines.

Activity associated with property, buildings and installations, including NATO infrastructure projects, is allocated overall funding of NOK 1,858 million in the budget proposals for 2011.

As a result of strict prioritisation, the funding allocation for nationally financed projects has been reduced by NOK 131 million while the funding for NATO financed infrastructure has been cut by NOK 98 million, mainly because the information infrastructure at the Joint Warfare Centre at Stavanger is now nearing completion. As an important element of the comprehensive strategy for the High North, the Government proposes to increase the Norwegian Army’s activities in Inner Troms still further. Substantial investment in buildings and installations is therefore needed to support the increased activities in this area.

For 2011 the Government proposes a budget of NOK 125 million to fund the work of the National Fortifications Heritage, together with an additional NOK 60 million for extraordinary maintenance. This is an increase in real terms of NOK 15 million compared with the consolidated budget for 2010 and it represents a contribution towards reaching the national target for the level of regular maintenance of heritage buildings and installations in the defence sector by the year 2020.

The number of national service conscripts undergoing initial military training will be maintained at approximately the same level as in 2010. Improved standards for the assessment interview scheme and a qualification system for initial military service will both contribute substantially to raising the status and predictability of this initial service for those who undertake it. These improvements, combined with established measures already being taken to raise the status of national service, will ensure that the period of initial military service will be seen as both attractive and relevant in today’s society.

Spain Budget Cut of 7% likely

Spain's defence budget is to be cut for a third consecutive year, according to figures presented to parliament on 30 September.
Total spending is due to drop by 7 per cent, roughly in line with the overall average reduction for all government spending, to EUR7.15 billion (USD9.83 billion).
One of the main areas of savings will come from cutting basic troop numbers in the services, which were fixed in 2007 to be between 80,000 and 90,000. Instead of the projected 86,000 maximum level due to be reached this year, the number is set to be reduced by 3,000 in 2011 and probably drop again the following year as new recruitment is curtailed.
Investment in new equipment is also due to fall by EUR220 million from 2010 levels to EUR1.07 billion.
However, the MoD announced this week that it is adding EUR33 million to the budget to allow state-owned shipbuilder Navantia to start work next year on a second batch of Buques de Acción Marítima (BAM) patrol boats for the navy.
Not included in the budget spending is the new 8x8 armoured infantry fighting vehicle for the army, the contract for which was postponed this year and put back until the first quarter of 2011. Analysts say this could be because the MoD is planning to arrange a deferral of payments, as it is already has on various new contracts.
One major procurement programme that will not be affected, Defence Minister Carme Chacón said earlier this month, is the Airbus A400M military transport aircraft.
The cost of overseas military missions - including those of the NATO-led International Security Assistance Force (ISAF) in Afghanistan, the UN's UNIFIL in Lebanon and the EU's Operation 'Atalanta' off the Horn of Africa - which currently stand at around EUR750 million a year, are not included in the MoD's budget.
Although they do not have an overall majority in parliament, the ruling Socialist (PSOE) government is expected to garner enough support from regional parties to push through its overall budget cuts.
The bill is due to be approved by parliament before the end of the year.

Ukraine 2011 Budget flat

Ukraine's defence budget for 2011 will stand at UAH13.6 billion (USD1.7 billion), according to Defence Minister Mykhaylo Yezhel.
The minister, who was speaking in Kiev on 1 September, said the figure had been agreed between the Ministry of Defence (MoD) and the Finance Ministry. He described it as "optimal in the current situation in Ukraine".
Low levels of defence investment are forcing the MoD to make hard choices.  Plans to reduce the size of the armed forces from the current level of about 200,000 personnel to around 160,000 were announced in July.

Poland 2011 Defense Budget up 7%

Poland Hikes Defense Budget, Seeks New Trainer

The Polish government is planning to increase defense spending in the coming
year, and as part of its focus on new equipment, also has
formally kicked off the competition for an integrated training
system, including an advanced jet trainer.
The move comes as defense spending in Poland will
jump 7% in 2011 from 2010 levels, representing about
1.95% of national spending. Capital expenditures are a
priority right now, with that budget allocation actually growing 12%.


WARSAW - After last year's tight defense budget, austerity measures seem to be over for Poland's Army. In 2011, the country's military spending will grow 7.1 percent from a year ago to 27.25 billion zlotys ($8.79 billion), Defense Minister Bogdan Klich said.
The budget proposal has yet to be approved by the Polish parliament.
"Last year's downturn has hindered the process of technological modernization of our Army," Klich said, adding, "the budget for the next year will ensure its necessary development."
In the upcoming year, the Ministry of Defense will spend approximately 4.8 billion zlotys ($1.55 billion) on new procurements, he said, according to the Polish news agency PAP. Recent statements by ministry officials indicate that the plan is to proceed with the key modernization programs but spend less on upgrading the existing equipment, according to the public finance watchdog Najwyzsta Izba Kontroli.
As Poland begins pulling its contingent out of Afghanistan by 2012, the Ministry of Defense will redirect resources to homeland security, in particular procurement of an air defense missile system for approximately $5 billion.
Anticipating the tender announcement, all likely bidders presented their offers from Sept. 6 to 9 at the International Defense Industry Exhibition MSPO in Kielce, as reported by the publication Raport-wto.
These included a proposal based on the short-range VL Mica and medium-range Aster-30 missiles from European missile maker MBDA integrated with radars and Grom missiles from Poland's Bumar Group; Norway's Kongsberg and Raytheon's joint bid comprising Patriot and NASAMS II systems; and Israeli Rafael and Raytheon with the Spider and Stunner interceptors.
Raytheon's competing proposals could have an edge because of Poland's military cooperation with the U.S., which resulted in a Status of Forces Agreement between the two countries Dec. 10, said an industry analyst. Since May 23, six MIM-104 Patriot missile launchers have been stationing in rotation at the military base of Morag in northern Poland. The missiles are to be deployed permanently beginning in early 2012.

French Political Support

The MBDA-Bumar bid was championed by French President Nicolas Sarkozy during Polish Prime Minister Donald Tusk's visit last year to Paris. Bumar also says the French are open to technology transfers, which could increase their chances of securing the contract.
Slawomir Kulikowski, head of the Polish Chamber of National Defense Manufacturers, said that while political backing is vital, Poland's budget shortcomings will play an equally important role in determining the winning bid. Providing a steady stream of funding for the air defense program might take some time, he added.
"The manner in which the contract will be funded is crucial for its future, because the Ministry of Defense is not capable of financing this deal on its own," Kulikowski said. "In the past, funding for major armament programs, such as the purchase of the F-16 aircraft, had to be secured directly from the national budget. If the government is willing to launch this [program], it should pass a financing bill in the parliament as soon as possible."
Poland also wants to replace its helicopter fleet by 2018, listed as one of 14 Army modernization programs. The Ministry of Defense is planning to order 26 helicopters, reported by the daily newspaper Rzeczpospolita. The choice will probably be made between Sikorsky's S-70i Black Hawk, assembled at the company's PZL Mielec plant in Poland, and the NH90 built by NH Industries, according to Rzeczpospolita, citing ministry sources.
Other planned procurements include flight and vehicle simulators, C4ISR systems, Spike anti-tank guided missile launchers and Rosomak armored modular vehicles, built by Poland's WZM Siemianowice under a license from Finland's Patria.
The Ministry of Defense has purchased 50 such vehicles this year and in 2011, it will order a further 73 vehicles that will carry additional armor for combat, and also medical evacuation variants.

New Procurement Agency Jan. 1

Future purchases are to be managed by the ministry's new procurement agency, the Armament Inspectorate, which is set to begin operating Jan. 1. The new institution will take over roles from different ministry departments, define procurement requirements and carry out all tenders.
Another priority is to overhaul the ministry's spending structure. Of last year's 25.45 billion zloty budget, some 12.67 billion zlotys were allocated for personnel expenses while only 12.52 billion zlotys went for capital expenses, including procurement. The ministry next year wants to reverse that ratio and shift toward a budget tailored for the needs of a fully professionalized Army.
Yet one recent proposal could jeopardize the current growth of military spending in Poland. According to various media reports, the government has been considering modifying a bill that obliges it to earmark 1.95 percent of gross domestic product (GDP) for military spending. Under the revised bill, defense spending would average 1.95 percent of GDP over a period of four or six years, meaning it could be lower in a given fiscal year.
"Presently, there are no plans of changing the ratio," Deputy Minister of Finance Hanna Majszczyk said Sept. 2 at a meeting of the Parliament's Defense Committee.
Moreover, should the government intend to scrap the fixed-ratio military spending, it could possibly face interparty opposition from President Bronislaw Komorowski. The spending mechanism was introduced under Komorowski's tenure as Poland's minister of defense in the years 2000-01, and some observers say he would be likely to veto any unfavorable changes to the current bill.