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Guyana - Military Spending

The GDF, as a public entity, receives most of its revenue based on allocations in the national budget. The Force’s budget from 1985 was slashed under the nebulous concept of ‘an affordable army’ introduced by the previous government. The cuts were based on guidelines set by the International Monetary Fund and other multi-national lending institutions that financed the Economic Recovery Program. The reduced spending policy set a cap on recurrent and capital expenditure, which affected emoluments and other maintenance costs and consequently reduced numbers.

The GDF’s budget from 1985 was slashed under the nebulous concept of ‘an affordable army’ introduced by the previous government. These cuts were based on guidelines set by the International Monetary Fund and other multi-national lending institutions that financed the Economic Recovery Programme. The reduced spending policy set a cap on recurrent and capital expenditure, which affected emoluments and other maintenance costs and consequently reduced numbers. Capital budget allocations over the period 1989-2000 reflected less than 1% of national allocations which negatively affected the Force’s ability to recapitalise and acquire new equipment. These allocations were also eroded by reduced dollar rates against the US dollar (devaluation) and rising prices (inflation).

The Guyana Defence Force Current Budget moved from $6.464M in 1970 to $73.8m in 1984, an increase of $67.424m, while the Capital budget moved from $0.068m in 1970 to $G 5.045m during the same period, an increase of $G 4.98m. Notably, however, were significant increases during the period 1975 to 1977 in both budgets and significant decreases in 1978. During the period 1985 to 2007 the Current Budget moved from $G 113.526M in 1985 to $G 4.2b in 2007, an increase of $G 4.08b. On the capital side there were significant increases in the years 2000, 2001, 2002 and 2005 to $G 460.795m, $G 971.216m, $G 244.965m and $G 183.902m respectively.

There was a dramatic increase in the capital budget for the period 2000 to 2001 with a maximum of approximately $G 1.0b ($US 5.3m) being allocated in 2001. From 2002 to 2007 capital funding to the Force decreased to an average constant amount of $G 120m ($US 0.6m).

Capital budget allocations over the period 1989-2000 reflected less than 1% of national allocations. This affected the Force’s ability to recapitalise and acquire new equipment. These allocations were also eroded by reduced dollar rates against the US dollar (devaluation) and rising prices (inflation). Consequently, there were reductions in several programs including training. However, the Force saw a marked increase in budgetary allocations in 2008 due to the violent crime situation which served as an impetus for the purchase and upgrade of aircraft and vessels.

Recapitalization is necessary to secure new kit and equipment to replace old, obsolete items. Mobility in air, land and water transport require significant upgrades and changes in some instances. The Force requires weapon upgrades, additions and upgrades for field artillery. Re-stocking of front line and training munitions consistent with weapon systems and replacement of ammunition (field artillery) destroyed during the explosion at Camp Groomes must be of a priority high and a permanent feature in the Force’s strategic defence review.

Acquisition of secure and reliable communication equipment and the integration of combat net radio and computer systems to improve command and control is also critical to provide the interoperability for integrated and transition operations. This is particularly relevant now, in the context of small team operations.

According to the World Bank, military expenditures data from SIPRI are derived from the NATO definition, which includes all current and capital expenditures on the armed forces, including peacekeeping forces; defense ministries and other government agencies engaged in defense projects; paramilitary forces, if these are judged to be trained and equipped for military operations; and military space activities. Such expenditures include military and civil personnel, including retirement pensions of military personnel and social services for personnel; operation and maintenance; procurement; military research and development; and military aid (in the military expenditures of the donor country).

Excluded are civil defense and current expenditures for previous military activities, such as for veterans' benefits, demobilization, conversion, and destruction of weapons. This definition cannot be applied for all countries, however, since that would require much more detailed information than is available about what is included in military budgets and off-budget military expenditure items. (For example, military budgets might or might not cover civil defense, reserves and auxiliary forces, police and paramilitary forces, dual-purpose forces such as military and civilian police, military grants in kind, pensions for military personnel, and social security contributions paid by one part of government to another.)

NATO defines defense expenditure as payments made by a national government specifically to meet the needs of its armed forces or those of Allies. A major component of defense expenditure is payments on Armed Forces financed within the Ministry of Defense (MoD) budget. Armed Forces include Land, Maritime and Air forces as well as Joint formations such as Administration and Command, Special Operations Forces, Medical Service, Logistic Command etc. In view of the differences between the NATO and national definitions, the figures shown may diverge considerably from those which are quoted by national authorities or given in national budgets.

They might also include "Other Forces" like Ministry of Interior troops, border guards, national police forces, customs, gendarmerie, carabinierie, coast guards etc. In such cases, expenditure should be included only in proportion to the forces that are trained in military tactics, are equipped as a military force, can operate under direct military authority in deployed operations, and can, realistically, be deployed outside national territory in support of a military force. Also, expenditure on Other Forces financed through the budgets of ministries other than MoD should be included in defense expenditure.

Pension payments made directly by the government to retired military and civilian employees of military departments should be included regardless of whether these payments are made from the budget of the MoD or other ministries. Expenditures for peacekeeping and humanitarian operations (paid by MoD or other ministries), the destruction of weapons, equipment and ammunition, and the costs associated with inspection and control of equipment destruction are included in defense expenditures.

Research and development (R&D) costs are to be included in defense expenditures. R&D costs should also include those for projects that do not successfully lead to production of equipment. Expenditure for the military component of mixed civilian-military activities is included, but only when this military component can be specifically accounted for or estimated. Financial assistance by one Allied country to another, specifically to support the defense effort of the recipient, should be included in the defense expenditure of the donor country and not in the defense expenditure of the receiving country. War damage payments and spending on civil defense are both excluded from the NATO definition of defense expenditure.