By February 2009, Canada’s military operation in Afghanistan will total $4.5 billion, including approximately $3 billion for operations in Kandahar since 2006. But that, says David Perry, one of the few academic experts to examine this subject, is just the tip of the iceberg when one factors in the toll on people and equipment, and the likelihood that the mission will be extended beyond 2009.
The announcement that a blue ribbon panel will advise the Prime Minister on the future of Canada’s mission in Afghanistan has taken some of the intensity out of the recent debate over the Canadian Forces future role in that country after February 2009.
Much remains to be decided, though. As the Speech from the Throne indicated, whatever the panel’s recommendations, the government sees a need for the Canadian military to stay in some capacity through 2011, the period covered by the Afghan Compact. As we begin looking seriously at future options, however, recent media reports indicate that there are some fundamental financial considerations to take into account.
In October, the Canadian Centre for Policy Alternatives (CCPA) released a report claiming that the military mission in Afghanistan will have cost over $7 billion by the end of the current fiscal year, and a Canadian Press story indicated that up to 28% of returning Canadian veterans of Afghanistan may have mental health problems.
These figures are troubling, but they only paint a picture of the costs to date. As we look ahead, what will the mission cost us, how is it being funded, and what can we expect in the future?
To appreciate the mission’s cost a basic understanding of how the Department of National Defence calculates these figures is required. The department tabulates the expenses incurred by an operation as both Full DND Costs and Incremental DND costs. The former represents the aggregate total of all expenses incurred by the department in conducting an operation. In an effort to better represent the “real” financial impact of an operation, however, incremental costs are also calculated by subtracting certain costs such as salaries and equipment depreciation and attrition from the full costs. Thus, the incremental costs are a subset of full costs meant to reflect what an operation costs the government over and above what it would cost to keep the same forces at home in Canada. In other words, incremental costs are the “net” financial burden.
Treasury Board documents pertaining to all operations since 2001 that have taken place in Afghanistan, or as part of Canada’s participation in the war on terror (Operations Accius, Altair, Apollo, Archer, Argus, Athena, and Foundation), reveal that by March of 2008, the total cost of all Canadian military operations in Afghanistan will be $3.5 billion in incremental costs, and $7.7 billion in full costs.
For a national military that prior to 9/11 had a budget of around $11 billion, these are substantial sums of money. These figures appear furthermore troubling when the funding for the operation is scrutinized.
In examining a combination of Department of Finance and Treasury Board documents, it becomes apparent that through March 2006, operations in Afghanistan received visible funding through either budget allocations or the supplementary estimates, with the exception of approximately $200 million of the overall $1.8 billion incremental cost of operations. With the deployment of the Battlegroup to Kandahar, however, in FY 2006-2007, the story is not quite the same – about $600 million of the operational costs lack visible funding.
While DND has been the recipient of spending promises amounting to over $18 billion from the Martin and Harper governments, most of this funding has yet to arrive. In fact, the net increase for FY 2006-2007 was only about $600 million, according to an analysis by the Conference of Defence Associations. Thus, barring an alternative explanation, it would seem that most of last year’s budget increase was redirected away from other priorities, to fund the war. Barring significant changes, we can expect much the same for the current fiscal year.
Furthermore, while the CCPA did not do so, it is possible to make a reasonable estimate for the costs of Afghan operations which, baring an election, seem destined to continue in their present form through February 2009.
To calculate a conservative estimate for operations in FY 2008/2009, we can guess that the costs for the third year of the mission will split the difference between the estimates for the first two. This would amount to roughly $825 million in predicted incremental costs for the final year of the mission, assuming it ends in February 2009, and that the size and configuration of the Canadian contingent remains roughly the same.
Finally, based on the Canadian Forces experience with Operation Apollo in Kabul, we can also conservatively estimate that it will cost at least $200 million to return the vehicles and equipment currently deployed in theatre to proper working form if our mission ends in February 2009.
Adding all of this together, we can predict that if Canada’s military operations in Afghanistan end completely in February 2009, the total cost of all operations in the country will be $4.5 billion. From this overall prediction we can further extract an estimate for the total cost of all operations since the mission moved to Kandahar province, which will be roughly $3 billion. For both of these predictions, we are assuming that the mission will end completely in February 2009, and that no meaningful changes will be made to the composition of our military contingent in the country. As neither one of these scenarios seems very likely, Canada’s military operations in Afghanistan will cost substantially more than $4.5 billion.
Human toll
Beyond the immediate financial impact of operations, we are already seeing signs of the toll the mission is taking on the people fighting the war, the equipment being used, and a military bureaucracy managing the largest operation overseas in more than 50 years. At the time of writing, 71 members of the military and one civilian had lost their lives in Afghanistan, while another 250 had been injured and 185 returned home from theatre for conditions such as battle stress.
Like our other allies in this conflict, it is becoming clear that Canadian veterans will probably face a host of problems related to their service in Afghanistan far into the future. While the Department of Veterans Affairs in the United States is now predicting that between 10% and 25% of Iraq veterans will experience mental health problems, including Post Traumatic Stress Disorder, a recent Canadian Press report claims that preliminary data in Canada suggests that 28% might be a better estimate for Canadian veterans returning from Afghanistan.
Focusing on operations in Kandahar alone, where at least 15,000 troops will have served by February 2009, and applying a range of 10-28% incidence of mental health problems, between 1500 and 4200 veterans may need help. To put this in perspective, the Canadian Army numbers roughly 20,000 soldiers, so even 1,000 would be significant. Furthermore, as the Auditor General’s October report makes clear, despite recent changes, there is much room for improvement in the military’s provision of mental healthcare.
Ultimately, Afghan veterans with either physical or mental disabilities will at some point become the responsibility of Veterans Affairs Canada (VAC). Only a few years ago, VAC was predicting that its client base would decline to 206,000 by March 2007. Now, after more than five years of Afghan operations, VAC’s current client population is 224,000 and rising. Approximately 13,000 additional CF members are predicted to begin receiving VAC benefits by 2010, at an average age of release from the Canadian Forces of 36. Although it is not clear how many of these veterans will be Afghan vets, logic dictates that substantial numbers will be, and they will be receiving care for the rest of their lives.
Although the scope of this problem, and its financials implications, will probably not be clear for several years, based on these preliminary figures it will be substantial.
Equipment costs
Also of great importance, to the military especially, is the effect that sustained operations in Afghanistan’s desert conditions will have on the equipment used in theatre. Between the Air Force’s round-the-clock efforts to keep the troops supplied, and the Army’s day-to-day operations, the Canadian Forces equipment is being used in theatre at a tempo far higher than the peacetime rates upon which equipment life cycles are largely based. When compounded by the impact of various force protection measures, such as the additional armour added to LAV IIIs, and constant driving at high speeds, the equipment is simply being used “harder” than it was originally designed for. And none of this even accounts for the impact of IED explosions that have completely destroyed an untold number of vehicles.
All of the preceding points to a looming need for Army re-capitalization, in a time frame that is probably approaching more rapidly than planners thought. Thankfully, Army equipment comes cheap, at least in comparison to the needs of the Air Force and Navy. But as work by the Conference of Defence Associations demonstrates, most Air Force and Navy equipment, exclusive of recently announced purchases, will need replacing within the next decade. Thus, at a minimum, the Army’s accelerating equipment needs will place all three services in direct resource competition as they fight for limited procurement dollars.
If recent experience is any indication, the war in Afghanistan is certainly helping the Army make its case with at least $380 million worth of unexpected or accelerated army procurement, plus the $1.3 billion tank acquisition. As we look at these purchases, it is fair to ask what trade-offs have been made to rush these purchases to the frontlines at relatively incredible speeds?
Other examples are emerging that further illustrate the impact to future plans of devoting the enormous resources needed to fight the war today. The expansion of the military, a key policy plank of successive governments and backed by substantial funding, has been severely curtailed because many of the available trainers are deployed overseas. Similarly, reports indicate that Canadian Expeditionary Forces Command, which is actually running the war, is vastly overworked, while Canada Command is being under-resourced. As we start focusing more on the Arctic, and with the Vancouver Olympics fast approaching, one hopes that the much needed focus on the current mission is leaving enough time, energy and money to address future concerns.
Whatever recommendations the blue ribbon panel ultimately provides, and whatever decision the government of the day ultimately makes, we need to look carefully at the mission in Afghanistan and ask what the costs will be, both in the short and long terms.
Afghanistan may be the mission of the moment, but the government will feel its effects far into the future. No matter what is decided about the military’s future role, it should be made clear how much it is going to cost, and what impact it will have on other priorities.
Dave Perry is a research associate and deputy director of the Centre for Foreign Policy Studies at Dalhousie University (dgprry@dal.ca).
