Spy agency’s budget to hit $460-million after ‘steady path’ of growth

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The federal government will spend nearly half a billion dollars this year on Canada's electronic-eavesdropping service, a spy group that is rapidly growing despite the austerity measures imposed on many other government agencies.

Communications Security Establishment Canada will spend more than $460-million this fiscal year, according to a "total budgetary expenditures" forecast released last week. The agency had been forecast to spend only $420-million this year.

The budget and staff of CSEC, which has caused controversy over its spying activities, have vastly increased since the Sept. 11, 2001, terrorist attacks in the United States.

"It's been a pretty steady path," said researcher Bill Robinson, who highlights CSEC spending on his blog, Lux Ex Umbra. "It certainly is significant compared to where the agency was before 9/11, at $97-million [in 2000]. Adjust that for inflation and it's $130-million, so it's a huge increase – 3 1/2 times."

While CSEC helps fight terrorism, it was not created explicitly for that purpose. Under the law, the spy agency exists to promote Canada's interests by spying on communications from foreign countries and keeping hackers out of government computer systems.

CSEC takes its direction from Defence Minister Rob Nicholson after the Conservative cabinet sets intelligence priorities. The federal government is building CSEC a new headquarters, now expected to cost more than $1-billion.

The latest estimates show new funds are earmarked for CSEC's help "to combat human smuggling" – an issue that became a priority for the Conservative government after two ships of asylum seekers from Sri Lanka came to Canada in 2009 and 2010.

CSEC's spying programs are mostly classified. Officials suggest that the the agency is a bargain, given how it taps into vast wellsprings of intelligence information.

"We estimate that the government's $387-million [in 2012] annual investment in CSEC provides access to a $15-billion global partnership represented by the Five Eyes," CSEC chief John Forster told a Parliamentary committee last year.

Mr. Forster was alluding to an alliance of electronic eavesdropping agencies from English-speaking countries that has existed since the Second World War. The Five Eyes is led by the U.S. National Security Agency, which has a budget of about $11-billion, and Britain's Government Communications Headquarters, which spends around $3-billion. Canada, Australia and New Zealand are junior partners.

For much of the past year, leaks from former U.S. contractor Edward Snowden have shown just how much the Five Eyes collaborate, including spying on friendly countries.

A presentation leaked last month showed that CSEC had scoured telecommunications traffic from Brazil's Ministry of Mines and Energy around the time that the NSA was running similar campaigns in that country.

Some lawmakers want a political watchdog for the 2,100 employee agency.

"I think it's time has come, given the Snowden revelations. We're the only Five Eyes country that doesn't have that kind of a body," said Wayne Easter, a former Liberal cabinet minister, in an interview.

Last week, he introduced a private member's bill that would give Parliamentarians a role in better supervising CSEC and other intelligence agencies. "The public awareness and concern has risen and their interests need to be represented better than they are," Mr. Easter said.

The new budgetary estimates further show that another intelligence agency, the Canadian Security Intelligence Service, will spend more than half a billion dollars this year, despite having been forecast to spend a little less. CSIS's intelligence officers, who work largely within the confines of Canada to recruit human sources, have also received huge budgetary increases since 2001.