The government and the federal Liberals are inching closer together over the contents of the federal budget, with Stephen Harper saying he and Liberal Leader Michael Ignatieff are in accord on the main aspects of what needs to be done.
The Prime Minister and Mr. Ignatieff had a "businesslike and cordial meeting" yesterday afternoon - one week before a budget that could spell the end of the Conservative government if it's voted down.
The Prime Minister's Office declined to say what the pair talked about, but it's very likely they discussed next week's budget, expected to deliver up to $30-billion in stimulus for Canada's ailing economy.
The meeting, which lasted just under 30 minutes, was set up at the request of Mr. Harper, who called Mr. Ignatieff's office. Mr. Harper had said last week that he planned to meet with leaders this week.
Also yesterday, Finance Minister Jim Flaherty responded in a letter to a series of demands laid out by Liberal MPs Scott Brison and John McCallum.
Speaking in Halifax earlier yesterday, the Prime Minister said he agrees with the notion proposed by the Liberals that any future tax cut cannot lead to a long-term deficit.
Mr. Harper told reporters that, while the government and the opposition don't agree on everything, "there are certainly broad aspects of what the Liberal Party is saying that we can agree with.
"... The government is listening broadly. We will come forward with a budget that is in the interest of the economy and that will carry the overall judgment of the people."
The Prime Minister, who has said tax cuts are being considered, has not been clear on how broad they would be. The government could, for example, focus cuts on certain segments of the population and programs, such as a retrofit plan for homeowners.
Mr. Ignatieff said yesterday that he does not want the deficit to be permanent and that there is no single issue upon which he will make a decision to support the government.
"That will be a critical issue, but I want to make clear it's not the only issue I'll be looking at when I read that budget," he said.
Mr. Ignatieff told reporters that the Liberals support targeted tax relief for the most vulnerable.
The Liberals are also drawing up a provisional budget in the event that the Tories fail to meet their requirements.
"We don't know yet whether we will pass the [Conservative] budget and whether there may be a coalition government, so we have to prepare for all contingencies," said Mr. McCallum, who chairs the party's economics committee.
Mr. McCallum declined to divulge the measures the Liberals are considering but said they would follow the criteria the party has laid out: helping the vulnerable and supporting "jobs today and jobs tomorrow."
"We certainly can't rule out the possibility of bringing down the government, in which case, if there were a coalition government, we'd need to have a budget pretty quickly."
Mr. McCallum said the Liberals would run deficits - as the Tories are planning - to offer stimulus but would have a "credible track back to a balanced budget."
The Conservatives narrowly avoided defeat in December by temporarily shutting down Parliament after the Liberals and NDP, with the backing of the Bloc Québécois, formed an alliance to oust them over an economic statement that they said did not contain enough economic stimulus.
Meanwhile, at a caucus meeting yesterday, sources said that Liberal pollster Michael Marzolini told Mr. Ignatieff and his MPs and senators that the only issue that interests Canadians is the economy.
Mr. Marzolini, head of the national polling firm Pollara, outlined new data that found that Canadians are willing to endorse an "awful lot of different types of intervention" from government in the economy, according to an insider.
Topping the list is the idea of infrastructure spending as a stimulus, according to the insider.
Mr. Marzolini also presented numbers that showed Canadians have an increasingly positive perception of Mr. Ignatieff.
