Trump budget coming Feb. 10 — here’s what you can expect

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WASHINGTON — The Trump administration plans to submit its fiscal 2021 budget request to Congress Feb. 10, with defense spending expected to be essentially flat compared to the previous year.A spokesperson for the Office of Management and Budget confirmed to Defense News that the date for the budget submission has been locked in. The date was first reported by Politico.

President Donald Trump signed off on the FY20 budget, including $738 billion for defense, on Dec. 20, following almost three months of the government running under a continuing resolution.

The two-year budget deal from last summer called for $740 billion in defense spending for FY21, essentially flat. The budget is expected to continue the department’s focus on implementing the National Defense Strategy, which prioritizes challenging China and Russia.

In a Jan. 2 note to investors, Byron Callan of Capital Alpha Partners predicted that defense budgets are unlikely to spike in the coming years.

“We think the most probable scenario for DoD investment budget authority is that it will show little annual growth in FY21-25. Flattening outlays in 2022-25 will ensue,” Callan wrote. “This does not mean all contractors will grow at the same rate, though scale and size may make it harder for the largest firms to beat underlying DoD market growth rates.”

That note came prior to the killing of an Iranian general in a U.S. airstrike; however, given the length of the budget process, the ongoing U.S.-Iran situation is unlikely to impact the FY21 request. Should conflict erupt between the two countries, members of Congress could re-prioritize the budget plan during negotiations on Capitol Hill. If so, it may result in funding for the Pacific or European theaters — the focus of the NDS — being redirected toward the Middle East.

Should the Iran situation expand, Callan predicts munitions accounts, already maxed out in many areas, would be a focus.

Leo Shane III with Military Times contributed to this report.


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