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The federal government reached an agreement with the opposition parties overnight to approve billions in emergency aid to deal with the economic fallout of the new coronavirus pandemic.

The opposition parties had earlier vowed to reject the governing Liberals’ plans to give themselves months of unlimited spending without parliamentary approval.

After hours of intense negotiations, the Liberal government agreed to pull contentious measures in the legislation and to submit a new version. A revised version of the bill was approved by the House of Commons in the early hours and is expected to be reviewed and approved today by the Senate.

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The latest version includes the $82-billion package of emergency spending measures and tax deferrals that Ottawa announced last week to help businesses and workers struggling through the COVID-19 pandemic. It also allows the government to spend on emergency health care measures without parliamentary approval until Sept. 30 of this year as opposed to Dec. 31 , 2021 in the original proposal.

Sources, whom The Globe is keeping confidential because they were not allowed speak publicly about the negotiations, say government drafters were updating the bill and that work was likely to continue overnight.

If accepted by all the parties, the plan is to have the House of Commons sit in the early morning hours to get the new bill passed and then it would adopted by the Senate later Wednesday.

One source of uncertainty is the role of Conservative MP Scott Reid, who attended Parliament Tuesday against the wishes of his party leader and is strongly opposed to the Liberal government’s original proposals. He could deny unanimous consent which would delay immediate passage.

In a blog post, Mr. Reid referred to the legislation as a “Henry VIII Bill” for allowing the executive to function without the approval of Parliament.

“So, unless someone stands athwart the march of history, crying ‘No!’ a new convention will be established,” he wrote. “None of the incipient new conventions outlined above can be allowed to stand, or Responsible Government in Canada is over. Full Stop.”​

The House of Commons was scheduled to begin a brief one-day sitting Tuesday at noon to pass legislation implementing the package announced last week. But opposition parties said they were shocked when they received an advance copy of the draft bill on Monday that included a host of new cabinet powers that went far beyond the measures announced last week.

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Prime Minister Justin Trudeau tried to address those concerns Tuesday morning by offering to remove one part of the bill related to taxation powers that would last until 2022, but the offer failed to win over the opposition. Mr. Trudeau later told reporters that the government is seeking to balance the need for parliamentary oversight with the government’s desire for flexibility to make decisions quickly in response to the fast-developing COVID-19 crisis.

“We recognize that this pandemic is moving extremely quickly and it is an exceptional situation that requires extreme flexibility and rapidity of response by governments to be able to help Canadians and react to a situation that we’ve seen is moving quickly every single day,” he told reporters during his daily news conference.

“We’ve been in close discussion with the opposition parties to find a way to both get that flexibility to be able to get measures out the door and keep in place our democratic institutions and the values that are so important to us all,” he said.

Just minutes after the House of Commons opened at noon, MPs agreed to suspend the sitting and launched into hours of behind-the-scenes negotiations aimed at reaching a compromise.

Around 6:30 p.m., MPs appeared briefly in the House of Commons before continuing with the negotiations.

The Conservatives, NDP and Bloc Québécois all said the recent support measures should be approved immediately, while debate over new powers for cabinet could be resolved at a later date. The government did not issue a clear public response to those requests.

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Conservative Leader Andrew Scheer said his party had promised to fast-track the $82-billion in emergency spending and tax deferrals announced last week, but was taken aback to see the measures contained in the draft legislation.

Even though the Prime Minister withdrew one part of the bill, Mr. Scheer said it still contains unacceptable measures.

“We want to build in some measures that ensure that parliamentary oversight is going forward, that there are some mechanisms for Parliament to do its job,” he told CTV’s Power Play early Tuesday evening as negotiations continued. “We have to be able to know there are some safety measures there on behalf of the Canadian people.”

In a statement, NDP Whip Rachel Blaney would neither confirm nor deny that an agreement in principle had been reached.​

“From the start, we’ve been focused on delivering help to Canadians as quickly as possible and holding the Liberals accountable by making sure that help goes to small businesses and the people who need it most," she said.

Bloc Québécois Leader Yves-François Blanchet said his party negotiated changes Monday evening for the government to limit the powers, including the removal of a clause that would have allowed Finance Minister Bill Morneau to raise taxes without parliamentary approval. The Bloc said it accepted that Ottawa can have unlimited spending power if needed but only until Sept. 30 of this year, rather than Dec. 31, 2021.

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“They [Liberals] wanted some extremely unique powers for an extremely long period of time which we could not agree. We negotiated some very important changes, which being the fact if the minister was to use some special powers of office, they could be used only for some reduction of taxes and nothing else,” he said.

The Bloc Leader suggested the Conservatives were holding up the bill and called for a vote in Parliament if there was not unanimity.

The Conservatives opposed unlimited spending power in the bill, but Mr. Blanchet said a deal was struck to have the minority Parliament meet to approve additional spending.

“The government would have to face Parliament, probably a few times, but at the latest on Sept. 30," he said, adding that the government would “pay a price” if it abused the powers under the restrictions his party proposed.

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