Defence purchasing agency being revamped

A new government office tasked with purchasing the most expensive equipment for the military is about to be upgraded to give it new independence and oversight, according to the Liberal government’s spring economic update.

Finance Minister François-Philippe Champagne’s fiscal update released on Tuesday promises to introduce new legislation to increase the authority and budget of the Defence Investment Agency — and to put under the oversight of a "new minister."

The legal changes will upgrade the six-month-old office to an independent agency, like the Canadian Security Intelligence Service or the Canadian Space Agency.

But the federal government did not explain how its political oversight will change, or what new authority it will gain.

The Liberal government created the office to speed up the pace of large military purchases worth more than $100 million.

The office is a central element of the Liberal government's defence industrial strategy. It is overseeing major defence procurements, including the next fleet of submarines for the Navy and the military’s Arctic over-the-horizon radar.

The economic update sets out $103.8 million in funding for the office over five years, plus another $22 million in ongoing annual funding. it does not offer details on why the new funding is needed.

The new office was created quickly under an established government department, Public Services and Procurement, as a special operating agency. This change would make it like a mini-department that functions largely on its own.

It’s currently overseen politically by Secretary of State Stephen Fuhr and Procurement Minister Joël Lightbound.

Just a day before the fiscal update, Doug Guzman, the CEO of the new office, told MPs that he did not know whether the government had decided on making it a Crown corporation or an agency. He did say work is already well underway behind the scenes to “separate it” from the procurement department.

Guzman said the need to reform Canada’s sluggish defence procurement system to prepare for a more threatening world will keep his organization on track.

“The necessity of (the office) will hopefully keep people on the rails of executing,” he said before the House of Commons defence committee on Monday.

Guzman told the committee the office currently operates out of buildings in both Toronto, where he has a home, and Ottawa, where most of the procurement bureaucrats are located.

Tuesday's fiscal update did not offer new information on how Canada plans to reach its steep new NATO commitment of spending the equivalent of 3.5 per cent of GDP on core defence by 2035.

The Department of Finance has yet to lay out a detailed spending plan for defence spending through to 2035 showing how it will hit that difficult target. The department declared that Canada is "on a path" to meet the target.

The spring economic update also did not pencil in funding for a new fleet of submarines.

It includes an earmark of $250 million over five years to increase skilled trades training through the Canadian military.

This report by The Canadian Press was first published April 28, 2026.

By Kyle Duggan | Copyright 2026, The Canadian Press. All rights reserved.