More information on the European Defence Agency is available at: www.eda.europa.eu ISBN: 978-92-95075-10-8 ISSN: 1831-9513 doi: 10.2836/16867 Š European Defence Agency, 2013 For reproduction or use of this material, permission must be sought directly from the copyright holder. Responsible editor : Eric Platteau Printed in Belgium
Introduction The European Defence Agency collects defence data on an annual basis. The Ministries of Defence of the Agency’s 26 participating Member States (all EU Member States except Denmark) provide the data. EDA acts as the custodian of the data and publishes the aggregated figures in this booklet. The data are broken down, based on a list of indicators approved by the Agency’s Ministerial Steering Board. This list has four sections, represented in the headings of the data presented in this brochure: General: macro-economic data to show how defence budgets relate to GDP and overall government spending Reform: major categories of defence budget spending – personnel; investment, including research & technology; operations & maintenance and others – to show what defence budgets are spent on European collaboration: for equipment procurement and R&T to show to what extent the Agency’s participating Member States are investing together Deployability: military deployed in crisis management operations to show the ratio between deployments and the total number of military
In November 2007 the Ministerial Steering Board approved four collective benchmarks for investment: Equipment procurement (including R&D/R&T): 20% of total defence spending European collaborative equipment procurement: 35% of total equipment spending Defence Research & Technology: 2% of total defence spending European collaborative Defence R&T: 20% of total defence R&T spending These benchmarks are collective: they apply to the total sum spent by all participating Member States together. They are voluntary: turning them into national targets is optional. There are no timelines for realising these benchmarks. In its final section this brochure provides the results of the collective benchmarks. The definitions, used for the gathering of the data, and some general caveats are listed at the end of the brochure. 3
4
Data Analysis - EDA pMS Aggregated Defence Data 2011 The figures refer to the total for all EDA 26 pMS and if not otherwise stated, they are nominal. Total defence expenditure down by € 1 bln In 2011, total defence expenditure of EDA 26 pMS amounted to € 192.5 billion - a reduction of € 1 billion or 0.5% compared to 2010 – representing approximately 1.55% of their total GDP and 3.17% of their total government expenditure, both values being the lowest since 2006. In real terms1, total defence expenditure has been decreasing since 2006 and between 2010 and 2011 it dropped by over 2%.
15.2% of total expenditure), and R&D expenditure – by 9% (€ 7.8 bln or 4.0% of total expenditure). As for Research and Technology2, expenditure increased by 3.5% up to € 2.15 billion reversing a downward trend since 2006. The only segment with a notable increase - 25.7% - was infrastructure/ construction expenditure amounting to € 6.8 billion or 3.5% of total defence expenditure.
Increase in collaborative procurement and R&T Defence investment (procurement and R&D) at its lowest level since 2006 Personnel-related expenditure of € 98.6 billion accounted for 51.1% of total defence spending – virtually unchanged since 2009. The second biggest component – operation and maintenance expenditure – increased by 3.6% and accounted for 23.5% (€ 45.2 bln) of total defence expenditure. However, defence investment, comprising equipment procurement and R&D expenditure, saw a sharp decrease of almost 14% bringing its value down to the lowest level since 2006 (€ 37.0 billion or 19.2% of total expenditure). Both components of investment contributed to the decrease: equipment procurement dropped by 15% (€ 29.2 bln or
In 2011, 27,1% or € 7.9 bln of total defence equipment procurement expenditure was spent on collaborative projects – the highest value and share since 2006. Of this, 92,7% (€ 7.3 bln) were European collaborations. Although the share of European collaborations in total collaborative equipment procurement decreased by 2% from 2010 to 2011, it nevertheless remained higher than in previous years. As for R&T, expenditure on collaborative projects and programmes increased by 25.6% breaking a downward trend since 2009, and in 2011 it stood at € 331 mln representing 15.4% of total R&T spend. European collaborative R&T expenditure also increased in absolute terms by over 15%
1. In order to measure real growth and ensure a “real” comparison between years, inflation needs to be taken into account. Thus, data from 2006 to 2010 has been inflated to 2011 economic conditions (Source of deflator: European Commission ECFIN – based on weight of EU 27). 2. R&T is a subset of R&D which includes only basic research, applied research and technology demonstration, leaving out expenditure for demonstration or development for which a decision to procure has been taken.
reaching € 283 mln (13.2% of total R&T spend), but as a share of total collaborative R&T expenditure it decreased from 93.1% in 2010 to 85.4% in 2011, its lowest value since 2007.
Numbers of military and civilian personnel continue to drop while expenditure per soldier increases In 2011, there was a reduction of both civilian and military personnel for the fifth consecutive year. Military personnel (81% of total staff working in defence) decreased by 4.3% to 1.55 million. Civilian personnel decreased by 3.9% to 374 thousand. Whilst personnel numbers reduced, defence expenditure per soldier increased by almost 4% reaching € 124 thousand. Defence investment per soldier, however, decreased by almost 10% and stood at € 24 thousand in 2011.
Reduction in troops deployed, but cost of operations increase As regards deployed operations outside the EU territory, similarly to the last two years, the average number of troops deployed decreased in 2011 both in absolute terms (from € 66 to € 54 thousand) and as a share of military personnel (from 4.1% to 3.5%) and is now at its lowest value since 2006. However, costs related to the deployed operations increased substantially (by 12.4% from 2010 to 2011) for the fifth consecutive year, reaching € 11.7 million or 6.1% of total defence expenditure. Operations costs per military deployed
have also been steadily increasing, and from 2006 to 2011 it nearly tripled reaching € 218 thousand.
Progress made on three out of four collective benchmarks In 2007, EDA pMS agreed on a set of collective benchmarks for investment. There is no obligation in terms of timeline or adoption of these benchmarks into national targets, but they can assist pMS in spending more on investment. In 2011, three out of four indicators made progress towards the agreed benchmarks. R&T expenditure broke a downward trend for the first time since 2006 increasing its share in total defence expenditure slightly from its lowest value in 2010 (1.07%) to 1.12%. It, nevertheless, remains well below the agreed 2% benchmark. The share of European collaborative R&T expenditure in total defence R&T spend also increased reaching 13.2% but remains below the 20% benchmark. The biggest progress was observed in European collaborative equipment procurement. As a share of total equipment procurement, it increased by 4 percentage points from 21.2% to 25.2%, the highest value since 2006, although still below the 35% benchmark. There was, however, a retrograde step in defence investment (equipment procurement and R&D). Being above the 20% benchmark between 2007 and 2010, in 2011 it dropped to 19.2% of total expenditure on defence, which is lower than the 2006 level.
5
GENERAL - Macro Economic Data GDP, Overall Government Expenditure and Total Defence Expenditure
14 000 12 000
+1,7% s 12 272
+6,7% s 12 072 s 11 316
+3,0% s 12 411
+4,0% s 12 046
-5,6% s 11 584
10 000 Billions of Euros
6
8 000 6 000
s 5 303
+4,2% s 5 525
+3,7% s 5 729
+2,3% s 5 858
+3,2% s 6 047
-0,7% s 6 072
4 000 2 000 +1,5% s 204
s 201
0 2006
2007
GDP Overall Government Expenditure Defence Expenditure
-1,5% s 201
2008
-3,5% s 194
2009
0,0% s 194
2010
-0,5% s 193
2011
GENERAL – Macro Economic Data GDP, Overall Government Expenditure and Total Defence Expenditure – real comparison*
14 000 12 000
+4,0% s 12 858
s 12 358
-0,7% s 12 762
+1,5% s 12 411
+2,7% s 12 232
-6,7% s 11 905
Billions of Euros
10 000 8 000 6 000
s 5 792
+1,3% s 5 885
+1,2% s 5 957
+1,1% s 6 021
+2,0% s 6 140
-1,1% s 6 072
4 000 2 000 -1,4% s 217
s 220
0 2006
2007
-1,5% s 209
2008
-2,5% s 199
2009
-2,0% s 197
2010
-2,0% s 193
2011
GDP Overall Government Expenditure Defence Expenditure * In order to measure real growth and ensure a ‘real’ comparison between years, inflation needs to be taken into account. Thus, data from 2006 to 2010 has been inflated to 2011 economic conditions (Source of deflator: European Commission ECFIN – based on weight of EU 27).
7
GENERAL – Macro Economic Data Defence Expenditure in Current and Constant* Prices
225 220
220
217
215 Billions of Euros
8
209
210 205 200
204 201
201
199 197
195
193
190
194
194
193
2009
2010
2011
185 2006
2007
2008
Current Prices Constant Prices (2011 values) * Data from 2006 to 2010 has been inflated to 2011 economic conditions.
GENERAL – Macro Economic Data Defence Expenditure as % of GDP and as % of Overall Government Expenditure
4,0%
3,79%
3,69% 3,52%
Billions of Euros
3,5%
3,31%
3,20%
3,17%
3,0% 2,5% 2,0% 1,78%
1,69%
1,64%
1,68%
1,61%
1,55%
2008
2009
2010
2011
1,5% 1,0% 2006
2007
Depence Expenditure as a % of Total General Government Expenditure Depence Expenditure as a % of GDP 9
GENERAL – Macro Economic Data Expenditure per Capita
30 000 25 000
+1,1% s 24 910
+6,2% s 24 648
s 23 217
+2,8% s 24 959
+3,8% s 24 280
-6,1% s 23 398
20 000 Euros
10
15 000 s 10 881
+3,7% s 11 281
+3,1% s 11 628
+1,8% s 11 833
+3,0% s 12 187
+0,2% s 12 212
10 000 5 000 +1,0% s 417
s 413
0 2006
2007
-1,9% s 409
2008
GDP per Capita Government Expenditure per Capita Defence Expenditure per Capita
-4,1% s 392
2009
-0,5% s 390
2010
-0,7% s 387
2011
REFORM – Defence Expenditure Breakdown* Defence Expenditure Breakdown in absolute values
140 120
-4,2% s 106,02
s 110,63
+1,1% s 107,21
-8,2% s 98,40
Billions of Euros
100
+0,3% s 98,65
-0,2% s 98,42
80 60 40
s 43,38 s 38,92
+8,1% s 46,89 +7,7% s 41,90
20
-7,8% s 43,25 +0,3% s 42,02
+13,9% s 9,33
s 8,19
+2,0% s 44,10 -2,6% s 40,92
-1,0% s 43,67 +4,8% s 42,87
+19,5% s 10,68
-4,3% s 8,94
+3,6% s 45,22 -13.8% s 36,96 +42,9% s 11,93
-21,8% s 8,35
0 2006
2007
2008
Personnel Operation and Maintenance Investment (Equipment Procurement and R&D) Other expenditure (including Infrastructure) * Most of the data has been revised
2009
2010
2011
11
REFORM – Defence Expenditure Breakdown Defence Expenditure Breakdown in absolute values – real comparison
140 120
s 120,81
-6,5% s 112,92
-1,3% s 111,49
-9,3% s 101,12
100 Billions of Euros
12
-0,9% s 100,17
-1,7% s 98,42
80 60
s 47,37 s 42,50
+5,4% s 49,94 +5,0% s 44,63
-10,0% s 44,97 -2,1% s 43,69
40 20
+11,1% s 9,94
s 8,95
+0,8% s 45,32 -3,8% s 42,05
-2,2% s 44,34 +3,5% s 43,53
+18,1% s 10,97
-22,7% s 8,48
-6,5% s 9,29
+2,0% s 45,22 -15,1% s 36,96 +40,7% s 11,93
0 2006
2007
2008
Personnel Operation and Maintenance Investment (Equipment Procurement and R&D) Other expenditure (including Infrastructure)
2009
2010
2011
REFORM – Defence Expenditure Breakdown Defence Expenditure – percentage breakdown
100%
s 201 Bln
s 204 Bln
s 201 Bln
s 194 Bln
s 194 Bln
s 193 Bln
55,0%
51,9%
53,2%
50,7%
51,0%
51,1%
23,0%
21,5%
22,7%
22,6%
23,5%
20,5%
20,9%
21,1%
22,1%
19,2%
90% 80%
Billions of Euros
70%
55,0%
60% 50% 40% 30%
21,6%
20% 10% 0%
19,4% 4,1%
4,6%
4,4%
5,5%
4,3%
6,2%
2006
2007
2008
2009
2010
2011
Personnel Operation and Maintenance Investment (Equipment Procurement and R&D) Other (including infrastructure)
13
REFORM – Investment Breakdown Defence Equipment Procurement and R&D/R&T - absolute values
45 40
s 38,92*
35 Billions of Euros
14
30
s 41,90*
s 42,02*
s 40,92
+7,7%
+0,3%
-2,6%
s 32,24* s 29,13*
+10,7%
s 33,27 +3,2%
s 32,52 -2,3%
s 42,87 +4,8% s 34,31 +5,5%
s 36,96 -13,8% s 29,17 -15,0%
25 20 15 10 5
s 9,79*
s 9,66*
s 8,75*
s 8,40
s 8,56
s 7,79
-1,3%
-9,5% s 2,48
-4,0% s 2,26
+1,9% s 2,08
-9,0% s 2,15
s 2,66
s 2,54 -4,3%
-2,4%
-8,9%
-8,0%
+3,4%
2006
2007
2008
2009
2010
2011
0
Total Investment Equipment Procurement R&D R&T (Subset of R&D) * Revised data
REFORM – Investment Breakdown* Defence Equipment Procurement and R&D/R&T – percentage breakdown 2006 80,6%
2007
2008
79,5%
14,5% 4,9% (1,32%) 19.4%
15,8% 4,7% (1,25%) 20,5%
2009 78,9%
79,1%
2010
2011
77,9%
16,8% 4,3% (1,16%) 21,1%
Other Defence Expenditure * 2006 data has been revised
16,5% 4,3% (1,23%) 20,9% 80,8%
17,7% 4,4% (1,07%) 22,1%
Defence Equipment Procurement
R&D (Includes R&T)
15,2% 4,0% (1,12%) 19,2% 15
16
REFORM – Personnel Number of Military and Civilian Personnel
2 500 000
2 425 169
484 827
2 000 000
-5,4%
-5,7%
2 294 274
457 392
-2,6% 2 324 487 -5,2% 433 780 55,0%
-6,2% -1,7%
2 094 872 426 335
-4,1% 2 009 907 -8,6%
389 719
-4,2% 1 925 465 -3,9%
374 427
1 500 000
1 000 000
1 940 342 -5,3%
1 836 882 -2,0% 1 800 707 -7,3%
1 668 537 -2,9% 1 620 188 -4,3% 1 551 038
500 000
0 2006
Military Personnel Civilian Personnel
2007
2008
2009
2010
2011
REFORM – Expenditure per Military Defence Expenditure and Investment per Military
140 000 +7,2% s 111 136*
120 000
+0,6% s 111 850*
+4,0% s 116 324*
+2,7% s 119 455
+3,9% s 124 133
s 103 654*
Euros
100 000 80 000 60 000 40 000 20 000
s 20 058*
+13,7% s 22 812*
+2,3% s 23 333*
+5,1% s 24 522
+7,9% s 26 458
-9,9% s 23 829
0 2006
2007
2008
2009
2010
2011
Defence Expenditure per Military Investment (Equipment Procurement and R&D) per Military * Revised data 17
18
REFORM – Outsourcing Outsourcing – absolute and percentage values Total outsourcing 2006: s14,1 bln 93,0%
Total outsourcing 2007: s14,5* bln 92,9%
7,0%
Total outsourcing 2009: s14,1 bln 92,7%
7,1%
Total outsourcing 2010: s15,4 bln
7,3%
* Revised data
94,0%
92,1%
Remainning Defence Expenditure
Total outsourcing 2008: s12,0 bln
Total outsourcing 2011: s13,4 bln 93,0%
7,9%
Outsourcing
6,0%
7,0%
EUROPEAN COLLABORATION – Equipment Procurement National and Collaborative Defence Equipment Procurement – absolute values
30 25
s 32,2 s 25,40*
s 29,1
s 33,3 s 25,20*
s 34,3 s 32,5
s 26,61* s 29,2
s 24,29
Billions of Euros
s 22,47*
s 21,26
20 15 10 s 6,08
s 7,07
s 6,11
s 7,14
s 7,29*
s 7,34
5 s 0,58*
0 2006
s 1,00
s 0,74
2007
2008
s 1,09
2009
s 0,57
s 0,41*
2010
2011
National Defence Equipment Procurement European Collaborative Defence Equipment Procurement Other Collaborative Defence Equipment Procurement * Revised data
19
20
EUROPEAN COLLABORATION – Equipment Procurement* National and Collaborative Defence Equipment Procurement – percentage breakdown 2006
2007
77,1%
2008
78,8%
75,8%
20,9%
18,9%
2,0%
2009
3,0%
2010
74,7%
2011
77,6%
72,9%
22,0% 3,3%
21,2%
2,3%
21,2% 1,2%
25,1% 2,0%
National Defence Equipment Procurement European Collaborative Defence Equipment Procurement Other Collaborative Defence Equipment Procurement * 2010 data has been revised
EUROPEAN COLLABORATION – R&T National and Collaborative Defence R&T– absolute values
2,5
s 2,66 s 2,272*
s 2,54 s 2,48 s 2,164 s 2,027
s 1,936
2,0 Billions of Euros
s 2,26
s 2,08 s 1,813
s 2,15 s 1,817
1,5
0,5 s 0,254 s 0,130*
0 2006
s 0,333*
s 0,412 s 0,290
s 0,045
2007
s 0,040
2008
s 0,246
s 0,032
2009
s 0,283
s 0,018
2010
s 0,048
2011
National R&T Expenditure European Collaborative R&T Expenditure Other Collaborative R&T Expenditure * Revised data
21
22
EUROPEAN COLLABORATION – R&T National and Collaborative Defence R&T – percentage breakdown 2006
2007
85,5%
2008
85,1%
81,8%
9,6%
13,1%
4,9%
2009
1,6%
2010
85,8%
2011
87,3%
84,6%
12,8% 1,4%
16,6%
1,8%
11,8% 0,9%
National R&T Expenditure European Collaborative R&T Expenditure Other Collaborative R&T Expenditure
13,2% 2,2%
DEPLOYABILITY – Troops Deployed Average Number of Troops Deployed
2 000 000
1 940 342
1 836 882
1 800 707 1 668 537
1 600 000
1 620 188
1 551 038
1 200 000
800 000
400 000 4,3% 83 310*
4,2% 77 880*
4,5% 80 177
4,1% 67 767
4,1% 66 313
0 2006
2007
Number of Military Personnel
2008
2009
2010
3,5% 53 744
2011
Average of Troops Deployed
% of Military Personnel * Revised data
23
24
DEPLOYABILITY – Deployable and Sustainable (Land) Forces Number of Deployable and Sustainable (Land) Forces
500 000 450 000
25,8%
24.2%
22,0%
27,8%
26,6%
27,5%
400 000 350 000 300 000 250 000 200 000 150 000
464 574
444 681
426 704
6,0%
5,2%
450 117
443 108
7,0%
425 824
6,4%
6,6%
7,1%
106 754
106 402
110 814
100 000 50 000
100 867
110 482
125 237
0 2006
2007
Deployable (Land) Forces % of Military Personnel
2008
2009
Sustainable (Land) Forces
2010
2011
DEPLOYABILITY – Operation Costs Operation Costs per Military Deployed and Total Operation Costs
s 11 700 Mln
220 200 180
s 10 407* Mln
Thousands of Euros
160
s 9 826 Mln
140 s 8 667 Mln*
120 100 80
s 218 s 6 613 Mln s 145
60 40
s 9 653 Mln
s 111
s 157
s 120
s 79
20 0 2006
2007
2008
2009
2010
2011
Operation Costs per military deployed Total Operation Costs * Revised data
25
26
BENCHMARKS Defence Equipment (including R&D) Procurement as % of Total Defence Expenditure
100% 90%
19,4%*
20,5%
20,9%*
21,1%
22,1%
19,2%
20,0%
80,6%*
79,5%
79,1%*
78,9%
77,9%
80,8%
80,0%
2006
2007
2008
2009
2010
2011
Benchmark
80% 70% 60% 50% 40% 30% 20% 10% 0%
Defence Equipment Procurement and R&D Other Defence Expenditure * Revised data
BENCHMARKS European Collaborative Defence Equipment Procurement as % of Total Equipment Procurement
100% 90%
20,9%
18,9%
21,2%
22,0%
21,2%*
25,2% 35,0%
80% 70% 60% 50% 40%
79,1%
81,1%
78,8%
78,0%
78,8%*
74,8% 65,0%
30% 20% 10% 0% 2006
2007
2008
2009
2010
2011
Benchmark
European Collaborative Defence Equipment Procurement Other Defence Equipment Procurement * Revised data 27
28
BENCHMARKS Defence R&T Expenditure as % of Total Defence Expenditure
100%
1,32%
1,24%*
1,23%
1,16%
1,07%
1,12%
2,0%
98,68%
98,76%*
98,77%
98,84%
98,93%
98,88%
98,00%
2006
2007
2008
2009
2010
2011
Benchmark
90% 80% 70% 60% 50% 40% 30% 20% 10% 0%
Remaining Defence Expenditure Defence R&T Expenditur * Revised data
BENCHMARKS European Collaborative Defence R&T Expenditure as % of Total Defence R&T Expenditure
100%
9,6%
13,1%
16,6%
12,8%
11,8%
90,4%
86,9%
83,4%
87,2%
88,2%
2007
2008
2009
2010
13,2%
20,0%
90% 80% 70% 60% 50% 40%
86,8%
80%
30% 20% 10% 0% 2006
2011
Benchmark
Other R&T Expenditure European Collaborative R&T Spend 29
30
Additional Notes on the Data
EDA is receiving the data from the Ministries of Defence of the 26 participating Member States. On occasions the data can be revised and this may have an impact on the overall aggregated figures. In order to have the most up to date data please check EDA’s website for updates: http://www.eda.europa.eu/ Data on GDP, General Government Expenditure and Population have been collected from Eurostat. However, this data is occasionally revised which may impact some of the data calculated by EDA. The Data provided is at the aggregate level which can produce different figures from other sources due to rounding.
For some spending categories, a margin of error exists as accounting systems in the participating Member States differ. Nevertheless, the presented data represents the best publicly available figures. Comparisons are made for 2006 to 2011. It should be noted that more firm trend analysis will only be possible after several years of data gathering. Significant changes in the exchange rates with the Euro has had a considerable impact on the 2008 data; the lower amount of defence expenditure is partly caused by significant drops of some of the pMS’ currencies exchange rates to the euro.
Definitions Data collection is based on definitions approved by the participating Member States. The Definitions below have been shortened and edited for this publication. Macroeconomic data: GDP, General Government Expenditure and Population are based on data from Eurostat. Total defence expenditure is defined as total Ministry of Defence (MoD) expenditure and defence related expenditure from other sources (other Ministries special budgetary lines). C ivilian personnel: the authorised strength of all civilian personnel on 31 December of each year employed by all military establishments and the armed forces. Military personnel: the authorised strengths of all active military personnel on 31 December of each year. P ersonnel expenditure: all personnel-related expenditure for military and civilian personnel, including from non-MoD sources. D efence equipment procurement expenditure: expenditure for all major equipment categories. R esearch and Development (R&D): any R&D programmes up to the point where expenditure for production of equipment starts to be incurred. R esearch and Technology (R&T): expenditure for basic research, applied research and technology demonstration for defence purposes. It is a subset of R&D. Investment: Equipment Procurement and R&D (including R&T) expenditure.
O peration and Maintenance (O&M) expenditure: covers O&M (spare parts and supplies) of major equipment, other equipment and supplies, and costs related to maintaining utilities and infrastructure. O ther expenditure: all other expenditure that cannot be attributed to any of the above categories. O utsourcing: defence expenditure for which services have been contracted at the central level with service suppliers from outside the MoD and/or Armed Forces. European Collaboration (a subset of Collaboration): agreement by at least two EU Member States’ Ministries of Defence for project or programme contracts. Possible non-EU partners share in such contracts is lower than 50%. ther collaborative expenditure: all collaborative expendiO ture that does not fall under the European Collaboration definition. Average number of troops deployed: average number of troops deployed throughout the year (all Armed Forces). D eployable (land) forces: (land) forces troops prepared for deployed operations (the NATO 50% target). Sustainable (land) forces: (land) forces troops undertaking or planned for sustained operations (the NATO 10% target).
31
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