Canada’s longstanding shortage of skilled workers has apparently made Prime Minister Stephen Harper mad as hell and he’s not going to take it anymore.

Sources tell CBC News that, for the past year, the prime minister has been banging heads in his government to come up with new ways to help Canadians get the right skills for the right jobs — namely, thousands of vacancies that companies are begging to fill.

Federal Human Resources Minister Diane Finley recently called the labour and skills shortage "the most significant socio-economic challenge ahead of us in Canada."

Officials say various proposals for a new national skills training strategy went to cabinet and back to the drawing board at least twice in the past year, including the creation of a whole new ministry to focus on the issue.

Now the latest version — minus a new ministry — is set to become the centrepiece of the federal budget being presented Thursday by Finance Minister Jim Flaherty.

The federal government currently gives the provinces more than $2 billion a year, mainly from the Employment Insurance fund, to administer a wide range of skills training programs.

But Conservative insiders say Harper is peeved at the lack of results, and determined to find a better way to solve the skilled-labour shortage that has been plaguing this country for years, even if it means taking over some programs from the provinces.

'He's frustrated'

"He’s frustrated," says a Conservative insider. "We're spending all that money and not seeing the matching result at the end. We’re hearing about it from business leaders across the country."

Officials say Harper has also been getting an earful from Canadian business executives who have accompanied the PM on foreign trade missions to China and other countries.

"It is their one constant complaint, and he's getting tired of hearing it," says a Conservative insider. "He’s also getting frustrated that when he tries to talk to the provinces, there's not a lot of movement on how to fix this. And they're all kind of consumed with getting more money from the feds."

No matter. Contrary to recent news reports, officials say Harper is not about to suddenly cut off funding to the provinces for skills training, and turn the whole issue into an exclusive federal responsibility. Instead, most of the national funding for skills training programs is covered by federal-provincial agreements that expire next year, and the Harper government is hoping to make major changes in any new deals.

"The whole thing is far more collaborative than what’s being reported," says one official. "Everyone understands this is a problem that needs to be tackled."

Harper’s growing impatience is understandable.

With unemployment hovering around seven per cent, the government estimates there are currently more than 260,000 job vacancies without qualified Canadian workers to fill them.

In addition, the latest immigration figures show another 213,000 Canadian jobs were filled last year by temporary foreign workers.

The biggest shortages of manpower are in health care, the skilled construction trades, information and communications technology, and jobs that require a background in science and mathematics.

The oil and gas industry alone estimates it will be short 5,000 skilled workers over the next three years, and will need hundreds of thousands over the next two decades.

Exactly how the PM and his government plan to fix a problem that has endured through administrations of all political stripes remains to be seen in the budget.

'We've never really figured it out'

One Conservative insider tells CBC News the government is looking at nothing less than "remaking the Canadian labour force."

He says that means starting at the basic education level: "There’s a general feeling there are too many kids getting BAs and not enough welders."

Measures aimed at promoting apprenticeships will feature prominently in the budget, he says.

"Other countries have sophisticated systems to bring bright young people into trades and professions, but we've never really figured it out."

The feds also want to break down provincial licensing barriers that currently prevent many skilled workers from using their credentials in all parts of the country.

Finally, the budget is expected to contain specific measures aimed at helping to train or retrain aboriginals, older workers, recent immigrants, and people with disabilities.

Responsibility with private sector

No matter how riled the prime minister may be, the one thing his finance minister won’t be promising is that government will do all the work.

“The government will help, but they are going to lay the ultimate responsibility for fixing this problem on the private sector,” says a Conservative adviser.

“There’s going to be pressure on industry to get with the program. It’s time for the private sector to pony up.”

Truth is, the government couldn’t afford to fund any big new initiatives of any kind, even if the PM were so inclined.

Flaherty’s budget figures are expected to show the government on track to balance the nation’s books by the next election in 2015, with an even smaller deficit this year than previously predicted.

But it is no secret the economy has been cooling and the so-called bitumen bubble is deflating, both of which are slowing the flow of tax dollars into federal coffers.

Recycled programs

That means the budget will probably have more than a few recycled programs labelled as new initiatives.

For instance, the budget is expected to announce a new national infrastructure program for municipalities and provinces, a commitment of billions of dollars over the next decade or longer.

In reality, the "new" scheme will simply replace the existing $8.8-billion Building Canada infrastructure program set up by the Conservatives in 2007, and which is set to expire next spring.

The budget is also expected to include some tax breaks to promote "high-end manufacturing jobs," more money for aboriginal education, and much ado about cracking down on tax cheats who don't file annual returns.

While it may be tradition that finance ministers buy new shoes before a budget, this year Flaherty may settle for shining the ones he’s got.

Insiders say the budget will be one of his most austere, and after seven years as finance minister, there is much speculation it could also be his last.