Liberal Leader Stéphane Dion pledged on Thursday to spend more than $70 billion over the next 10 years to improve Canada's infrastructure if his party is elected to form a government.


Liberal Leader Stéphane Dion boards a GO train in Burlington, Ont., on Thursday. ((Frank Gunn/Canadian Press))

Speaking during a campaign stop at a Toronto commuter train station alongside former leadership rival Michael Ignatieff, Dion called Canada's cities and towns "the engines of our economy."

He pledged to divert budget surpluses that exceed a $3-billion contingency fund to infrastructure projects, particularly those with a green focus.

"We Liberals know that infrastructure investment is a national issue and it should be treated as a national economic investment to keep Canada competitive," Dion said.

Dion said the Liberals would honour existing framework agreements between Ottawa and the provinces, and adjust the gas tax transfer to help municipalities stay ahead of rising infrastructure costs.

A Liberal government would also create an infrastructure bank to provide all levels of government low-cost financing for projects such as regional energy grids and high-speed rail, he said.  

"This plan will provide Canada's economic engines with the support they need, and is an important part of our efforts to reduce Canada's environmental footprint," Dion said.

Promises 'not even close to being affordable': Harper

The head of the Federation of Canadian Municipalities called the announcement "good news" in the face of what the organization said was a $123-billion municipal infrastructure deficit.

Federation president Jean Perrault called Dion's plan "ground-breaking," but commended all parties for responding to the crisis with major new commitments.

"It's a good example of the tools we need to turn the tide," Perrault told reporters in Ottawa on Thursday at the release of his organization's election wish list, which calls on the federal government to erase the infrastructure deficit within 20 years.


Conservative Leader Stephen Harper, backed by a group of senior citizens, answers questions during a news conference in Trois-Rivieres, Que., on Thursday. ((Paul Chiasson/Canadian Press))

But Conservative Leader Stephen Harper immediately lashed out at the spending proposal, saying Dion was again promising money no government could afford while the Tories' plans have all been budgeted well ahead of the Oct. 14 federal election.

"The measures we're announcing in this campaign are modest and affordable within the four-year budget we've published," Harper told reporters during a campaign stop in Trois-Rivières, Que. "On the other hand, the expenditures of our opponents are not even close to being affordable."

Dion and Harper have been locked in a battle of words over their proposals, with each saying the other's plans will lead Canada into a recession.

Harper has said his government's plan of "modest" spending proposals is the safest course for Canada in the face of global economic uncertainty, and painted Dion's Green Shift plan for income-tax cuts through taxing carbon fuels as risky and unproven.

Dion, in turn, has said Harper has mismanaged a once-booming economy into one with growth dropping to among the lowest of G8 nations.

On Thursday, Dion invoked the names of past Liberal prime ministers to emphasize his party's record of fiscal responsibility and team philosophy, saying the Jean Chrétien-Paul Martin tradition of fiscal discipline "is now part of the Liberal DNA."

Dion also said Harper "finally took off his rose-coloured glasses" when he acknowledged this week that the Canadian economy had problems.

"For once, just this once, I agree with Stephen Harper," Dion said. "There are problems. One of these problems is Stephen Harper."

With files from the Canadian Press