Armed Forces

Polish National Defence Commission Accepted the FY2015 Budget Plan

Parliamentary National Defence Commission has adopted the budgetary plan for FY2015. The defence expenditure will constitute an amount of almost PLN 38.4 billion, where 5.3 billion will be allocated to F-16 fighters payment. Without taking that amount into account, the Polish defence spending is to be equal to 1.95% of GDP.

During the meeting of the National Defence Commission the MPs adopted a budgetary project for FY2015 within the scope of national defence. The main part of defence spending – PLN  33,024 billion – is to constitute 1.95% of current year's GDP. Separate financial assets are to be used to finalise the procurement of the F-16 multi-role jets. This amount is to be as high as  PLN 5.363 billion.

According to the MoD’s secretary of state, Maciej Jankowski, defence spending is going to be as much as 2.27% of the GDP. He also stated that the budgetary project involves PLN 1 billion of subsidies, PLN 7.4 billion for benefits, including PLN 6.5 billion for pensions and a little less than 8 billion of personal spending. Capital expenses, without taking into account the F-16 multi-role fighter jets expenditure, are going to be equal to, according to the budgetary project submitted by the Ministry of Finance, PLN 8.4 billion.

Mariusz Antoni Kamiński MP noticed that the F-16 expenditure shall not be included in the MoD budget, since it is being realized with “totally different assets”. He also reminded the participants of the meeting that the legal regulations related to the modernisation of the Armed Forces assume that the F-16 fighters will be purchased with the means placed beyond the range of 1.95% of GDP. The problem of payment related to the multi-role jets has already been covered by

Buyout of vouchers is being realized by the Ministry of Finances in accordance with “Equipping the Polish Armed Forces with Multi Role Jets” Programme. Treating buyout of, so called, B vouchers as defence spending, results in a total amount of PLN 38.387 billion. Taking into account the funds allocated to buy the F-16, the modernisation expenditure is going to be as much as 35.9% of the MoD budget. Within the scope of the modernisation act regarding the Armed Forces, it has been assumed that this indicator is to be no lower than 20%. Excluding the B-voucher buyout from the budget decreases the above mentioned modernisation expenditure level down to 25.5%.

MP Kamiński was satisfied with the indicator of the capital expenses in the next year’s budget, claiming that in the following years, further increase of the fund’s share allocated to the defence modernisation should be maintained. MP Waldemar Andzel stated that in the current geopolitical outline, increasing the defence spending up to 3% of GDP would be desired. MEP Michał Jach on the other hand, expressed doubts as to whether the Polish MoD realizes the modernisation programmes effectively enough.

In a response, MoD secretary of state Maciej Jankowski stated that there is a certain flexibility in allocating the financial means to the individual projects, hence no threat exists when it comes to executing the modernisation budget. The discussion also covered the matters related to the R&D spending. The head of the Air Force Institute of Technology, Ret. Col. Prof. Ryszard Szczepanik, Ph.D. D. Sc. Eng. requested increase of the R&D dedicated assets – he emphasised that billions of zlotys are not needed, dozens of millions would be enough. He reminded the participants that the Institute creates solutions inter alia within the scope of UAV systems and cyberspace for the aircraft.

What’s next?

The commission has adopted the budgetary project in a voting – 14 votes for, 6 against. According to the project, MoD will receive the largest budget it ever had at its disposal so far. On the other hand course of the discussion creates a lot of doubts regarding possibilities of executing the budget. Taking into account the current geopolitical situation in Europe and the status of equipment of the Armed Forces, maintaining at least nominal defence expenditure level similar to the current year (taking into account payments related to the F-16’s – PLN 38 billion) is desired. This would make it possible to restore the readiness of the armed forces and reverse the results stemming from the cuts made in the preceding years.