Table of Contents
Table of Contents

National Defense Authorization Act for FY 2023

How the $858 billion in spending that Congress just authorized breaks down

The U.S. Senate, by an overwhelming bipartisan majority (83-11), passed the $858 billion fiscal 2023 National Defense Authorization Act (NDAA), echoing the previous week’s passage of the bill by the U.S. House (350-80). The legislation now goes to President Biden’s desk for his signature.

The bill increases the U.S. national security budget by just over 10% from last year’s $778 billion. It increases pay for service members, authorizes the purchase of new weapons, and ends the military’s COVID-19 vaccine mandate.

The NDAA authorizes, but does not appropriate. Money to fund the Defense Department must be appropriated by Congress as part of the Consolidated Appropriations Act. This legislation funds the entirety of government for the fiscal year.

This is the 62nd consecutive year that Congress has reached bipartisan, bicameral agreement on the NDAA. This year’s agreement, the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023, provides $857.9 in top-line funding, including $847.3 billion in NDAA allocations and $10.6 billion in other extra-NDAA funding activities.

Key Takeaways

  • Congress, by an overwhelming majority, passed the $858 billion fiscal 2023 National Defense Authorization Act (NDAA).
  • This is the 62nd consecutive year of bipartisan, bicameral agreement on the NDAA.
  • The NDAA authorizes, but does not appropriate, funds to run the Department of Defense.
  • In addition to direct authorization for the Department of Defense (DOD), the NDAA authorizes military expenditures in the Department of Energy and other nonmilitary jurisdictions.
  • The NDAA contains additional authorizations to provide for the readiness and well-being of American troops.

Organization of the NDAA

The 3,854-page NDAA is organized into nine divisions as follows:

Division A—Department of Defense Authorizations establishes procurement procedures for the DOD and authorizes $816.7 billion to fund the armed forces.

  • A 4.6% pay raise for military service members and the DOD civilian workforce
  • A 2% increase in the housing allowance for service members
  • $160 billion for aircraft, missiles, ammunition, combat vehicles, Navy ships, and other equipment
  • Funding for research and development of a new nuclear-capable cruise missile that could be launched from ships or submarines
  • Requiring the Secretary of Defense to rescind the mandate that members of the armed forces be vaccinated against COVID-19

Division B—Military Construction Authorizations provides funding for construction projects.

  • $7.3 billion for military construction to address unfunded requirements, cost to complete, and market adjustment funds due to inflation
  • Update of the integrated master infrastructure plan to support the defense of Guam
  • Study requirements for future land-force ranges, training areas, and related facilities in Hawaii
  • $165.3 million for the continued training and equipping of vetted Syrian groups and individuals
  • A waiver for the caps on the costs of construction and repair on a per-project basis

Division C—Department of Energy National Security Authorizations and Other Authorizations

  • $22.3 billion for the activities of the National Nuclear Security Administration (NNSA)
  • $6.8 billion for Department of Energy (DOE) defense environmental cleanup activities
  • $978.4 million for additional DOE defense activities
  • $156.6 million for DOE nuclear energy activities
  • $30 million threshold for minor construction indexed to inflation for three years

Division D—Funding Tables lays out, in detail, how appropriated funds will be apportioned in all divisions and the source for all listed authorized funding.

Division E—Non-Department of Defense Matters provides funding for veterans programs and related activities, including:

  • Women who served as nurses during World War II
  • Transition grants for veterans upon separation, retirement, or discharge
  • Improvement of Veterans Affairs centers

Division F—Other Matters

  • $800 million for the Ukraine Security Assistance Initiative (USAI)
  • $10 billion over five years to finance sales of weaponry and military equipment to Taiwan
  • Training and other security assistance to help Guam defend itself against a possible invasion by China
  • $1 billion to buy minerals, such as hard-to-get metals and lithium-ion battery ingredients for the country’s defense stockpile
  • Prohibit U.S. government agencies from purchasing items that contain semiconductors made by Chinese manufacturers with ties to China’s Communist Party

Division G—Don Young Coast Guard Authorization Act of 2022 provides authorization for funding of the Coast Guard to include:

  • Allocation levels of military strength
  • Building land-based infrastructure and facilities
  • Acquisition of additional Coast Guard cutters
  • Permission for U.S. Coast Guard personnel to train with foreign partners under the Indo-Pacific Maritime Security Initiative (MSI)

Division H—Financial Transparency includes the following financial security legislation:

  • The Financial Transparency Act, which requires financial regulators to adopt a set of data collection and dispersion standards and to adopt electronic forms to replace paper-based forms
  • The Anti-Money Laundering Act and Corporate Transparency Act, which provides protection for individuals, corporations, and organizations from a whole host of criminals as well as protection for whistleblowers who report these crimes

Since many of these criminals are Russian oligarchs, these matters take on military significance.

Division I—Public Lands

  • The Protecting America’s Wilderness Act funds a Department of Defense study on the “impacts that the expansion of wilderness designations in the western United States would have on the readiness of the armed forces of the United States with respect to aviation training.”

What changes does the fiscal 2023 National Defense Authorization Act (NDAA) make regarding the military justice system?

The fiscal year (FY) 2023 NDAA modifies military justice reforms enacted in the FY 2022 NDAA, including adding additional covered offenses to those over which the Office of Special Trial Counsel will exercise authority.


  • The Manual for Courts-Martial would be amended to ensure that residual prosecutorial and judicial duties with respect to covered offenses are transferred to an appropriate entity.
  • Comprehensive reporting from the Department of Defense (DOD) regarding implementation of last year’s reforms would be required.
  • Article 66 of the Uniform Code of Military Justice (UCMJ) would be amended to authorize judicial review of any conviction by court-martial, regardless of the sentence imposed.
  • Article 69 of the UCMJ would be amended to clarify the scope of review in general and special court-martial cases reviewed by a judge advocate general.
  • Article 25 of the UCMJ would be amended to require the randomized selection of personnel for service as panel members on courts-martial.

What funding does the NDAA authorize?

Each year, the NDAA authorizes funding levels and provides authorization for the U.S. military and other critical defense priorities, ensuring that troops have the training, equipment, and resources they need to carry out their missions.

Does the NDAA provide funding for the military?

The NDAA itself does not fund the military. It authorizes the use of funds appropriated by Congress. In short, the NDAA is the budget used by the military to direct appropriations made by the U.S. Congress.

The Bottom Line

The National Defense Authorization Act (NDAA) is one of very few pieces of legislation that has overwhelming annual support from both sides of Congress. The fiscal year (FY) 2023 NDAA makes the 62nd consecutive year that this authorization document has been approved by a majority of members of Congress.

Because it is popular, it is also an occasional repository of add-on legislation that might not receive approval on its own. For example, in the FY 2023 NDAA, the Financial Transparency Act would seem to have little to do with military operations. That said, the actual money that funds the NDAA comes from the omnibus budget bill, which is always a contentious piece of legislation on Capitol Hill.

Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
  1. U.S. Senate Committee on Armed Services. “Reed, Inhofe Praise Senate Passage of the Fiscal Year 2023 National Defense Authorization Act.”

  2. Congressman Adam Smith, Washington’s 9th District. “House Passes National Defense Authorization Act.”

  3. U.S. Senate Committee on Armed Services. “Summary of the Fiscal Year 2022 National Defense Authorization Act,” Page 1.

  4. U.S. Senate Committee on Armed Services. “Summary of the Fiscal Year 2023 National Defense Authorization Act,” Pages 2, 3, and 8.

  5. Congressional Research Service. “Defense Primer: The NDAA Process,” Page 1.

  6. Congressional Research Service. “Defense Authorization and Appropriations Bills: FY1961–FY2021,” Pages 33–35 and 41.

  7. U.S. Senate Committee on Armed Services. “Summary of the Fiscal Year 2023 National Defense Authorization Act,” Page 1.

  8. U.S. Senate Committee on Armed Services. “Summary of the Fiscal Year 2023 National Defense Authorization Act.”

  9. U.S. Senate Committee on Armed Services. “Summary of the Fiscal Year 2023 National Defense Authorization Act,” Pages 9 and 15.

  10. U.S. Senate Committee on Armed Services. “Summary of the Fiscal Year 2023 National Defense Authorization Act,” Page 17.

  11. Congress.gov, U.S. Congress. “H.R.7900—National Defense Authorization Act for Fiscal Year 2023,” Page 1779.

  12. Congress.gov, U.S. Congress. “H.R.7900—National Defense Authorization Act for Fiscal Year 2023,” Pages 1851–1869.

  13. U.S. Senate Committee on Foreign Relations. “Risch Praises Inclusion of SFRC Priorities in FY2023 NDAA.”

  14. U.S. Senate Committee on Armed Services. “Summary of the Fiscal Year 2023 National Defense Authorization Act,” Pages 8, 15, and 17.

  15. Congress.gov, U.S. Congress. “H.R.7900—National Defense Authorization Act for Fiscal Year 2023,” Pages 1413–1414.

  16. Congress.gov, U.S. Congress. “H.R.7900—National Defense Authorization Act for Fiscal Year 2023,” Pages 3416–3424.

  17. U.S. Senate Committee on Armed Services. “Summary of the Fiscal Year 2023 National Defense Authorization Act,” Page 9.

  18. Congress.gov, U.S. Congress. “H.R.7900—National Defense Authorization Act for Fiscal Year 2023,” Pages 3550–3610.

  19. Congresswoman Carolyn Maloney, NY-12. “Maloney and McHenry Applaud Inclusion of the Financial Transparency Act in FY 2023 NDAA.”

  20. American Bar Association. “The Corporate Transparency Act: Augmented Federal Anti-Money Laundering Legislation Brings New Reporting Requirements of Company Ownership.”

  21. Congress.gov, U.S. Congress. “H.R.7900—National Defense Authorization Act for Fiscal Year 2023,” Page 3611.

  22. U.S. Senate Committee on Armed Services. “Summary of the Fiscal Year 2023 National Defense Authorization Act,” Page 4.