Pressrelease

53/96, 4 October 1996

Defence budget for 1997

The Defence Budget for 1997 continues to reflect the priority assigned to the Armed Forces and the Government's determination to achieve its long-term goal of strengthening Norwegian defence capabilities. The budget amounts to NOK 24.3 billion. Excluding international operations, this represents an increase in real terms of 0.9 percent compared with 1996.

The budget does not, however, include any allocation for our participation in NATO's Implementation Force (IFOR) in Bosnia. Taking this into account, the budget in fact represents a reduction in real terms of 2.7 percent compared with 1996. The Government will be considering the question of Norwegian participation in any future international peace-keeping force that might be established in Bosnia when the mandate for NATO's current operation expires and this matter will be discussed further once the situation becomes clearer.

Over recent years there have been cut-backs in the operational and maintenance costs of the Armed Forces in line with the Long-Term Report (Report No. 16 to the Storting (1992-93)). During the current period of transition now facing the Armed Forces, these cost reductions are being accompanied by improvements in quality. These measures will result in smaller forces but an enhanced defence capability. To enable this restructuring to be accomplished within the framework approved by the Storting [Parliament], emphasis is placed on the need to implement the necessary financial and material investments without delay in order to provide a defence capability of the quality that would be required in a war situation.

To enable the major equipment projects to be carried through successfully it will be necessary to strengthen the project teams. It is also clear that the restructuring tasks themselves require additional personnel. Taken together with increases in training and exercises, these additional requirements necessitate an increase in the budget for operations and maintenance. The budget for 1997 will therefore show some divergence from that for the previous year in the context of the long-term plan but this must not, however, be taken as an indication of any pause in the process of restructuring the Armed Forces.

Operations and activities

There will in 1997 be an increase in real terms of 2.1 percent in the budget for operations and maintenance when the costs of international operations, the Coast Guard and Search and Rescue (SAR) services and early retirement incentives are excluded. Coast Guard and SAR service costs will be held at last year's levels.

Despite the increase in the budget for operations and maintenance, further economies and efficiency improvements in the workings of the Armed Forces are planned. The achievement of improved quality and lower operational and maintenance costs as set out in the Long-Term Report remains the objective.

Education, training and exercises are seen as important Defence priorities. During 1997, all Home Guard units will be exercised. Certain units with lower priority missions will, however, undergo shorter periods of training than those with high priority missions.

For both the Army and the Navy the level of training and exercise activity will be somewhat higher than in 1996 while the level for the Air Force will be unchanged. Joint exercises with allied forces will be maintained at the 1996 level.

The Government will continue to strengthen the level of professional training in the Armed Forces by increasing the apprentice intake. This will help to ensure the recruiting of the requisite professional skills as well as still further enhancing the relevance of the training given during conscripts' initial military service. Those receiving specialised professional training during their initial military service will also be better equipped to find jobs on completion of their initial service.

The Defence Budget for 1997 does not include any allocation to cover Norwegian participation in any future international peace-keeping force that might be established in Bosnia when the current mandate for NATO's Implementation Force (IFOR) expires. This is because of the uncertainty surrounding what will happen when the mandate for this force expires in December 1996. When NATO's current mandate expires the Government will return to the question of continuing Norwegian participation in any future international peace-keeping force that might be established in Bosnia. Norway's participation in the UN peace-keeping force in Lebanon will be maintained in 1997.

Investment in defence equipment to be increased

Investment in defence equipment will be increased by 0.8 percent in 1997. This means a total investment in materiel amounting to NOK 6.3 billion. The Defence Establishment is on track towards achieving its aim of an overall investment in defence materiel of NOK 30 billion at 1992 prices for the plan period 1994-98.

The Government is proposing two new equipment projects for the Army. 1000 new, specially built, tracked all-terrain vehicles are to be procured and 1000 older tracked vehicles are to be upgraded. These all-terrain vehicles will provide the Army with greater mobility and a new concept of combat operations. They are primarily intended for use by key units in North Norway. The Field Artillery will also get a new fire control system to permit the use of new types of ammunition.

The Government proposes to allocate NOK 957 million for centrally financed building and construction projects for defence purposes. Emphasis is placed on improvements in defence efficiency to be achieved by combining a number of different functions in the same installation. Environmental improvements are also seen as a priority area. It is proposed that NOK 491 million should be allocated specifically to environmental measures.

In addition to centrally financed building and construction projects there is the continuation of the relocation of Armed Forces resources at Gardermoen. According to the present schedule the new Gardermoen Air Force Base could be in use by December 1996.

NATO-financed building and construction projects consist mainly of continuation work on the SINDRE II early warning radar systems, fuel tank installations and platforms for the new air refuelling site at Sola Air Force Base and the communications system for the exchange of surveillance and control data between land and air forces.

Security policy adapted for an unstable Europe

Political changes in Europe are a continuing factor affecting the framework of Norwegian security policy. This situation can, however, provide new opportunities for Norway to exert influence in international forums. The principle challenge facing Norway is thus to continue to safeguard Norwegian interests while exercising the maximum possible degree of influence in areas affecting the development of security policy in Europe.

The changes taking place in an unstable Europe affect Norwegian security and defence policy to a significant extent. In recent years we have been able to increase our participation in international peace operations, reduce the state of alertness of Norwegian forces and establish collaboration with the former Warsaw Pact countries. The aim is to ensure that Norwegian security policy interests continue to be understood and taken into account by our principal collaborative partners.

Today Norway faces no immediate military threat. Nevertheless the national Defence Organization is entrusted with the tasks of safeguarding Norwegian sovereignty, helping to ensure the necessary freedom of action for the Norwegian authorities in protecting our rights and interests, preventing war and contributing to stability and peaceful development, especially in Northern Europe.

In 1997 there are two matters in particular which will be of central importance. Firstly the agreement on Conventional Forces in Europe (CFE) needs to be adapted to the new situation in Europe. In accordance with this agreement, a conference was held in Vienna in May 1996 at which the implementation of the agreement was discussed. The outcome of this conference was not a particularly fortunate one either for Scandinavia as a whole or for the Baltic states because Russia was granted significantly increased flexibility with regard to the disposition of her armed forces in the border regions. In the case of Norway, however, the original agreement will continue to apply.

Secondly, the future development of NATO will be of great interest with regard both to collaboration within the alliance and to the eventual enlargement of NATO itself. France's recent interest is closer military collaboration within the alliance suggests that NATO will continue to be the central player where matters of security policy in Europe are concerned. The greatest challenge, in political, military and economic terms will be the enlargement of NATO to include new member states.

(in NOK 1 000)

The table shows nominal changes in the budget, that is current prices.

(1) Chapter 1715, the Government Catering Services, being established in 1997 forming as a State enterprise.

(2) The relative increase in Chapter 1725 is due to reimbursement by the Norwegian Public Service Pension Fund following early retirement for civilian employees before the age of 60. The numbers are increased by NOK 100 million.

(3) The reductions in the Search and Rescue Services are due to the purchasing of two new helicopters.

(4) The reductions under this chapter are primarily due to reduced capacity in the observatory units and reduced activity in former Yugoslavia.

(5) The Budget of the Defence Resource Organisation has a relatively large increase due to anticipated transfers of redundant personnel from the Defence Organization to the Resource Organisation.