Government to put $3b extra into defence

The Government will today announce details of a major funding injection for the Defence Force expected to be worth more than $3 billion over 10 years.

The funding will be aimed at boosting depleted troop numbers and rebuilding aged infrastructure.

It is the Government's first major pre-Budget announcement involving new funding and one it hopes will deflect claims of defence underfunding heading into the election.

It is expected to financially match the Government's 2002 Long Term Development Plan, which gave $3 billion over 10 years to the Defence Force to buy equipment such as naval vessels and helicopters.

The announcement is designed to complement that plan by providing crucial financing for the recruitment and retention of personnel.

Defence Minister Mark Burton said the announcement was not a quick fix but a long-term investment.

The Government has been continually attacked over what critics label underspending on defence.

Last year, of the $44.5 billion of core Crown expenditure, 3 per cent was spent on defence, 20 per cent on health and 18 per cent on education.

National Party leader Don Brash implied in an Anzac Day speech last week that the Government was running down the Defence Force and becoming too distant from Australia on defence matters.

Act leader Rodney Hide also criticised the Government's defence priorities last week, saying New Zealand was not pulling its weight in the international community.

Mr Burton denied that today's announcement was in response to criticism, saying it was a long-term response to personnel problems.

He would not give precise figures of how many extra personnel he would expect to be recruited, saying only that it would result in significant increases over time.

The Defence Force has been plagued with retention and recruitment problems. Its total numbers have dropped from 15,891 at the end of 1996 to 12,747 at the end of last year.

While numbers have shown greater stability over the past three years, the Defence Force has not been able to recover past losses.

The military's attrition rate last year was 14.77 per cent, one point higher than the year before, despite four pay rises in four years.

Low unemployment has placed an added burden on recruitment.

Mr Burton said recruitment and retention had always been a challenge for the Defence Force.

"What it means in the reality of today's labour market is that the Defence Force has to be more and more competitive."

The problems with recruitment and retention led to the Defence Capability and Resourcing Review being commissioned in 2003. Today's announcement will detail Mr Burton's response to the review, which was completed in February.

It is likely to involve some form of restructuring at corporate level.

The review also investigated deferred maintenance issues around infrastructure and the announcement will also address this.

Mr Burton said the impact of "sustained fiscal constraint" in the 1990s, combined with the "high operational tempo over the period of the last six or so years", had contributed to the staffing problem. The new Defence Force figures show that while the civilian workforce has grown and regular force numbers have stabilised, non-regular force numbers have fallen to about 2300 - half what they were nine years ago.