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Australia Announces A$62.6 Billion Defense Budget for 2026-2027
The Australian government released its fiscal 2026-2027 budget allocating A$62.6 billion ($45.2 billion USD) to defense, a 6 percent increase from the previous year. The spending equals 2.02 percent of GDP with a target of 3 percent by 2033. The budget includes higher funding and staffing for the Australian Submarine Agency to support the AUKUS nuclear submarine program.
May 12, 12:31 PM·1m read1 source
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The Australian government on Tuesday released its budget for fiscal 2026-2027 that sets aside A$62.6 billion ($45.2 billion USD) for defense. This represents a 6 percent increase over the previous year's defense budget and equals 2.02 percent of gross domestic product.
Officials plan to raise defense spending to 3 percent of GDP by 2033. The budget provides additional resources to the Australian Submarine Agency, which manages the country's effort to develop and acquire nuclear-powered submarines under the AUKUS pact.
The agency is allocated A$512.5 million for the coming year, a 33 percent increase from its current budget. Staffing at the agency is projected to rise to 1,209 employees in fiscal 2027 from the current level of 833. The nuclear submarine program is forecast to become the most expensive defense acquisition in Australian history.
Documents project spending of between A$71 billion and A$96 billion on the submarines and supporting infrastructure from now until 2036.
Pillar 1 aims to deliver eight locally built AUKUS-class submarines beginning in the 2040s. The program continued without change following a review by the Trump administration. The investment plan also calls for A$28 billion to A$35 billion over the next decade on long-range strike capabilities across air, land and sea domains.
This includes up to A$1 billion for air-launched hypersonic weapons. These amounts do not cover separate plans to build local manufacturing capacity for precision munitions. The budget documents further state that Australia will take delivery of its 14th and final Boeing P-8A Poseidon maritime patrol aircraft and three L3Harris MC-55A Peregrine surveillance aircraft in the remainder of 2026.
