Drones, ship maintenance and work to replace the country’s aging naval fleet are the target of this Budget’s defence spending, with the boost to maritime security coming as conflict in the Middle East continues to disrupt international shipping.

A total of $880 million of operating funding and $700m of new capital funding would pay for activities and operations, as well as priority projects identified in the Defence Capability Plan (DCP), Defence Minister Chris Penk announced this morning.

There would be a strong focus on maritime security, Penk said.

“New Zealand’s prosperity and security depend on the sea. For many years, New Zealand’s geographic distance has been seen as a shield from instability elsewhere in the world.

“However, recent events have served as a reminder of how quickly disruptions to international shipping routes can affect economies and supply chains across the globe.”

HMNZS Aotearoa is among the New Zealand Defence Force's naval fleet. Photo / Jason Dorday

Oceans weren’t a barrier to danger, but a “vital national interest that must be actively secured”, Penk said.

The Maritime Fleet Renewal programme would receive funding for the ongoing work of delivering a modern and combat capable navy, as well as for two types of drones, he said.

“One will be used in the South-West Pacific to provide long-duration intelligence, surveillance and reconnaissance, while the other is polar-capable and can conduct missions from Royal New Zealand Navy vessels in the Southern Ocean.”

The Budget would also allow for critical maintenance on the Anzac-class frigates and HMNZS Canterbury, to extend the life of the existing ships until they are replaced, Penk said.

Further major projects would deliver new and upgraded training facilities and continue the long-term Homes for Families programme; building modern, healthy houses for personnel and their whānau, he said.

The Budget also included investment in the economy through construction, maintenance and sustainment projects with New Zealand-based businesses, and $1.5m of capital funding alongside $16m of operating funding to begin work on the Technology Accelerator programme.

The pilot programme focused on connecting industry with Defence to solve specific military challenges, Penk said.

“More than 80% of the New Zealand Defence Force’s (NZDF) $2.6 billion operating and personnel budget is spent within New Zealand, bolstering the economy while serving the dual benefit of ensuring we have a strong Defence Force.”

Last year, the Government announced it would invest in a combat capable NZDF that pulled its weight internationally and domestically through the Defence Capability Plan, he said.

This year’s Budget delivered on that promise with $1.6b of new funding, and bringing the total new investment in defence to $5.8b since the plan was released.

This came at a time when people and equipment were expected to be called upon more often, [and] in challenging circumstances, Penk said.

“Whether it be providing support during severe weather events at home or deploying with trusted partners overseas, New Zealand’s personnel undertake vital work and deserve unwavering support.”

Finance Minister Nicola Willis will deliver the Budget on Thursday next week, May 28.

She’s expected to focus on health, education, defence, tight spending and a return to surplus.

A number of pre-Budget announcements have already been made in the areas of health and education, and earlier this week Willis confirmed more job cuts for the public sector to save the Government $2.4 billion.