Opposition parties won't support Tory economic update

Canada's opposition parties said Thursday they will vote against the Conservative government's fiscal update, sparking speculation the country could face another election in the midst of a global economic crisis.

Dion says PM must 'look at his options' to avoid fall of government

Canada's opposition parties said Thursday they will vote against the Conservative government's fiscal update, sparking speculation the country could face another election in the midst of a global economic crisis.

The Liberals, NDP and Bloc Québécois said they would not support the update introduced by Finance Minister Jim Flaherty because it contained no stimulus package to spur Canada's slumping economy and protect Canadian workers during the crisis.

The update is a confidence vote on Stephen Harper's minority Conservative government and could be voted on as a ways and means motion as early as Monday evening.

Liberal Leader Stéphane Dion said the parties' decision to reject Flaherty's proposals means it's up to the prime minister to evaluate his options.

"We will vote against this plan," Dion told reporters outside the Commons.

"We cannot support the plan the finance minister presented today. It's a plan to hide the deficit; it's not a plan to get our economy back on track," said Dion.

The Conservatives have the weekend to reconsider their economic agenda and avoid an election, Liberals said. 

"It's up to [Harper] to look at his options," said Dion. "We're asking the prime minister to reconsider it because obviously Canadians don't want an election."

NDP MP Thomas Mulcair also said his party would "do what it's done in the past, stand up to the right-wing agenda of Stephen Harper."

Moments later, a fuming Bloc Leader Gilles Duceppe told reporters his party "will categorically oppose" the update.

Dion did not respond when asked whether a handful of his MPs might be absent for a vote on the update, a move that would give the government enough numbers to survive. In the last Parliament, the Liberals used the tactic several times to prevent triggering an election.

Speaking to reporters later in the day, Liberal finance critic John McCallum promised his party's MPs would not be offering a "token vote."

"It will be all members voting against," McCallum said.

Other prominent Liberal MPs, including Michael Ignatieff and Dan McTeague, also said they were unprepared to back down.

"[Harper] has misread the mood if he thinks that the Liberal caucus is going to cave on this matter," Ignatieff said. "No way. No way."

Coalition talk 'premature': Brison

Should the update be defeated, Mulcair said the constitution allows room to avoid another election only weeks after Canadians returned the Conservatives to power with another minority government.

"There are a lot of other things that will happen before we would have an election, especially so soon after the last one," Mulcair said.

Among other options, the opposition parties could try to form a coalition government or reach agreement to give the Liberals, who came second in the Oct. 14 election, a chance to govern.

But Liberal MP Scott Brison told CBC News parliamentary editor Don Newman that any talk of a coalition government is "premature" because opposition parties were surprised by "how bad" Flaherty's update was.

"These are pretty early days," he said. "Today ought to have been about people, not politics, but about people who are losing their jobs."

There were reports Thursday evening, however, that some MPs were exploring how to usher Dion from his post in anticipation of forming a coalition with the NDP and Bloc, which have both signalled reluctance to align themselves with the Liberal party under its current leader. 

Some MPs said Jean Chretien had been approached for advice on how to negotiate Dion's early exit, according to the Canadian Press. Other sources close to the former prime minister said he has not been contacted and is not involved.

Proposed party funding cuts 'attack democracy': Layton

The opposition parties have also assailed Flaherty's plan to eliminate the $30 million in public subsidies all political parties receive, saying the Conservatives were more interested in playing politics than protecting Canada's threatened economy.

Flaherty told the House the proposed cut, to take effect on April 1, 2009, would ensure there is "no free ride for political parties."

"This is the last stop on the route; there will be no free ride for anyone else in government, either," Flaherty said.

"Canadians pay their own bills, and for some Canadians, that is getting harder to do. Political parties should pay their own bills, too, and not with excessive tax dollars."

NDP Leader Jack Layton said the Tories were trying to "attack democracy" and protect their financial advantage over other parties.

"I’m asking the prime minister how such an attack is going to create one job or protect one pension," Layton told the House. "Why are they protecting the Conservative party?"

The prime minister replied that the government had acted "early and strongly" to deal with the economic crisis and ensure Canada's fiscal position remains the strongest of all G7 nations.

With files from the Canadian Press and Reuters