Palmer United Party Senator Jacqui Lambie says Australia isn’t spending enough on defence.
“Australia’s defence spending as a ratio of our GDP (1.5 per cent) is the lowest it’s ever been since pre-World War II when aggressive, anti-democratic, totalitarian governments in Germany and Japan caught us napping,” she said in a press release on August 19.
ABC Fact Check investigates how much Australia spends on defence.
Defence spending was 1.71 per cent of GDP in 2013-14, and is projected to be higher in 2014-15.
In 1938-39 it was 1.5 per cent. The lowest it has been since then is 1.62 per cent in 2002-03 and again in 2012-13.
Defence spending as a ratio of GDP is not the lowest it’s been since before World War II.
Senator Lambie is incorrect.
Strictly speaking I suppose 1.71% > 1.62%. That is a difference of 0.09% – is that even a rounding error?
Well probably not – but it gets worse. The first thing to note is that the ABC claims that Australia spent $27 billion in total on defence is 2013-14 and that makes up 1.71% of GDP. Well, not according to the Budget Papers that report Australia only spent $25.665 billion on defence in that year (BP1 pg. 6-17). The next question is, “What is GDP in that year?” Well I can reverse out two numbers either $1.579 trillion or $1.582 trillion. Okay – so lets split the difference and say the Australian economy was $1.58 trillion in 2013-14. That means defence spending according to the Australian government via its own budget papers was 1.62% of GDP in 2013-14, not 1.71% as the ABC claims.
Now where does Lambie’s 1.5% figure come from? Well she has taken the figure of $22.84 billion (BP1, page 6-16) and divided that by the estimate of GDP. Using my estimate that comes out at 1.445% of GDP and with a generous round-up that’s her 1.5%. That calculation doesn’t take net capital investment into account.
So, um, Jacqui Lambie is in fact correct. Well, okay, if you insist, partially correct; defence spending is at all time equal lows since WWII, but not the lowest.