Security Challenges
Volume 9, No.4 (2013)

The Funding Illusion: The 2% of GDP Furphy in Australia's Defence Debate

One of the most effective rhetorical punches thrown by the Coalition during its period in Opposition was the (accurate) claim that Australia‘s defence spending had slipped to the lowest levels since 1938. In turn the Coalition nominated a target of spending two percent of Australia‘s gross domestic product on Defence, should it win the 2013 election. This promise was later echoed by the Labor Government. This article explores how the 1938 comparison emerged, how it morphed into a two per cent of GDP policy target and argues that this debate has been unhelpful for Australia‘s security. It argues that the Coalition, now in office, should abandon the two per cent target and return to a more orthodox approach to funding defence.

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