Australia Announces Record $53 Billion Peacetime Defense Spending Increase

Defence Minister Richard Marles announced the 2026 National Defence Strategy and Integrated Investment Program, marking the largest peacetime increase in military spending in Australian history. The plan allocates an additional $14 billion over the next four years and $53 billion over the decade, aiming to lift defense expenditure to 3% of GDP by the early 2030s. The total capability investments through 2035–36 are projected at A$425 billion.

Marles cited a more dangerous global environment, specifically the rapid militarization by China and instability in the Middle East, as primary drivers. Key priorities include the AUKUS nuclear submarine program, long-range strike capabilities, and autonomous systems, including the Ghost Bat jet and Ghost Shark drone. The government will invest $12 billion in a defense precinct at the Henderson shipyard and $5 billion in drone technology. To offset costs, the government plans to sell 67 military sites to raise approximately $1.8 billion and explore private equity financing.

Opposition Leader Angus Taylor criticized the 3% GDP target as "creative accounting," arguing that the government used NATO's broader spending definitions—which include pensions and housing—rather than direct military investment. Additionally, Innes Willox of the Australian Industry Group warned that strategic intent must be matched by concrete resourcing and industrial readiness. While the Trump administration reportedly pressured allies to reach a 3.5% GDP benchmark, Marles denied that U.S. pressure was the catalyst for the strategy.