SPECIAL FEATURE

A Guide to Defense Expenditures

Q1 What is the current status of defense expenditures in Japan?

A1.As a result of Japan’s difficult fiscal situation in recent years, a majority in the general account budget has been allocated for social security expenditures, while defense expenditures have been curtailed. Total defense expenditures in FY2002 were 4.9392 trillion yen, but in FY2013 this amount had fallen to 4.6804 trillion yen, which is about 260 billion yen decrease. In order to respond to the current security environment, the MOD must continue to secure budget in FY2014 and beyond as it did in FY2013, representing the first real increase in 11 years.

Q2 Tell us about the Defense Expenditures of other countries.

A2.As for changes in national defense spending by major countries over the previous decade, if FY2003 was set as 1, Japan’s defense expenditures have risen by 0.94 times, Russia’s by 5.12 times, China’s by 3.51 times, and the United States’ by 1.68 times. With regards to the percentage of defense spending per total GDP in FY2011, Japan was at 0.96%, Russia at 3.0%, China at 1.2% and the United States at 4.5%.

Q3 With defense expenditures being curtailed, will there be any impact on the SDF’s ability to procure equipment necessary to fulfill its mission?

A3.Despite defense expenditures cutback, the cost ratio of maintaining defense equipment has risen due to its improvement. Since FY2005, maintenance costs have surpassed the contract value of mainstay defense equipment, making it harder to procure new mainstay equipment. At the same time, the rising cost of equipment has reduced the amount that is procured. Since declining procurement volume results in higher equipment prices, the defense industries are in a negative cycle of rising prices.

As a result, concerns are emerging over the difficulty of procuring a stable supply of equipment to maintaining the country’s defense capabilities.

Q4 Have any measures been considered to address declining procurement volumes?

A4.The MOD is taking a variety of measures for all defense equipment to achieve greater streamlining and efficiencies. This includes review of maintenance methods and specifications/uses of civilian products.

Examples of budget request for FY 2014

Examples of review of maintenance methods (for FY 2014 and beyond)

  • - Conversion interval extension of Sonar Dome rubber windows for submarine
    - Reduce the number of units to be procured by extending the replacement interval from 9 to 12 years
  • - Maintenance interval extension of gas turbine engine for vessels
    - Extend the interval of periodic maintenance for main engines, etc. of destroyers
  • - Extension of overhaul interval of minesweeping/transport helicopter (MCH-101) engines
    - Extend engine overhaul interval by extending the useful life of parts
  • - Extension of periodic maintenance interval of transport aircraft (C-130H)
    - Extend the interval of periodic maintenance from the current 36 months to 45 months

Examples of uses of civilian goods/ review of the specifications

  • Use commercial ship specifications and civilian goods when building a rescue ship for multiple purposes, including disaster relief activities
  • Use cost effective devices for upgrading of radar on P-3C
  • Substitute by civilian harbor radio telephone
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