Prime Minister Stephen Harper accused the Liberals of playing the "biggest political game in history" during a heated question period in the House of Commons on Monday.

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Prime Minister Stephen Harper responded to a barrage of questions and accusations from opposition members in the House of Commons on Monday. ((Adrian Wyld/Canadian Press))

His accusation came after Liberal Leader Stéphane Dion, fresh from being named the leader of a proposed coalition with the New Democrats, questioned the legitimacy of Harper's minority government.

"Instead of introducing an economic stimulus package in his fiscal update last week, the prime minister decided to play politics, ignoring the difficult economic times Canadians are facing," Dion said.

"Does the prime minister still believe that he enjoys the confidence of this House?"

The Liberals were scheduled to table a motion on Monday, saying the Conservatives had lost the confidence of the House over their failure to recognize the seriousness of the economic situation facing Canada, but the Conservatives delayed their potential demise by putting the vote off until Dec. 8.

Harper defended last Thursday's fiscal update, saying it included help for seniors hit by the worldwide financial turmoil and other measures to stimulate the economy, such as doubling infrastructure spending to record levels next year.

The prime minister then shot back: "When the honourable gentleman speaks about playing politics, I think he's about to play the biggest political game in history."

The question period marked the first exchange between the federal political parties since it emerged that the Liberals intended to topple the minority government with a no-confidence motion, setting off a flurry of extraordinary parliamentary activity.

Throughout Monday's raucous session, opposition parties hammered Harper and Finance Minister Jim Flaherty with questions about their controversial fiscal update.

The Tories have since backtracked on the most divisive issues, dropping plans to cut the public funding political parties receive on a per-vote basis and moving the budget up to late January, with suggestions it will include an economic stimulus package.

Flaherty said the budget will be delivered Jan. 27 — the earliest date "in modern times." The government also caved on plans to ban public service strikes for the next three years.

Bloc Québécois Leader Gilles Duceppe called the Conservatives' retreat over the weekend an attempt to keep the boat from sinking.

In defence, Harper said his party had been elected to form the government and also received a vote of confidence following the throne speech.

"In my opinion, I think we should at least wait for the budget to determine the future of a government just elected by the public," Harper said.

Flaherty said the party has chosen to have a "steady hand" on the economy, rather than making a "deal with the devil," referring to the Liberal-NDP coalition government that would also rely on the support of the Bloc Québécois.

The prime minister said the Conservatives would never consider forming a coalition government with the separatist party.

"I would certainly not want to find myself governing this economy today and in this position under a situation where I was required to follow socialist economics and be at the behest of the veto of the separatists," said Harper.

All three opposition leaders accused Harper of reversing his position, pointing to a 2004 letter to the governor general by then Opposition leader Harper that suggested he be allowed to form a coalition government if Paul Martin's Liberal minority government were to fall.

Layton said Harper should remember the meetings in which he proposed the coalition. "I walked out," the NDP leader said, adding that he wrote about it in his book.

On Monday afternoon, Dion said the Liberals and the NDP, backed by the Bloc, have signed a deal to form an unprecedented coalition government if they are successful in ousting the minority Conservative government in an upcoming confidence vote.

CBC News has learned the six-point accord includes a description of the role of the Liberal and NDP caucuses, which will meet separately and will sit next to each other on the government benches in the House.

The proposed coalition cabinet will be composed of 24 ministers and the prime minister. Six of these ministers will be appointed from within the NDP caucus.

The accord will expire on June 30, 2011, unless it is renewed.

It includes a "policy accord" to address the "present economic crisis," which states that the accord "is built on a foundation of fiscal responsibility."

An economic stimulus package will be the new government's top priority, while other policies include a commitment to improve child benefits and child care "as finances permit."

There is also a commitment to "pursue a North American cap-and-trade market" to limit carbon emissions.

The Bloc would not officially be a part of the coalition, but the new government's survival would depend on its support.

Dion sent a letter to Gov. Gen. Michaëlle Jean today advising that the Harper government has lost the confidence of the House. It will then be up to her to decide whether to call an election or let the Liberals try to govern.