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The opposition parties signed a deal Monday to form a coalition government and advised the Governor General that they're ready to take over from the Conservatives.
Liberal Leader Stephane Dion sent a letter to Michaelle Jean advising that the Harper government has lost the confidence of the House of Commons.
He said the Liberals and NDP - backed by the Bloc Quebecois - have reached a deal to form a coalition for at least 18 months.
"Canadians elected 308 members of Parliament in October, not just Stephen Harper," Dion told a news conference after signing the coalition deal with NDP Leader Jack Layton and Bloc chief Gilles Duceppe.
"We are ready to form a new government that will address the best interests of the people instead of plunging Canadians into another election."
Dion would serve as prime minister until spring when he is to be replaced as Liberal leader.
His letter states that the new government "will effectively, prudently, promptly and competently address these critical economic times."
The pact includes a multibillion-dollar stimulus package for the troubled economy, including support for the auto and forestry sectors.
The opposition plans to vote down the minority Tories in a scheduled confidence vote next Monday. It will then be up to Jean to decide whether to call an election or let the Liberals try to govern.
The opposition parties say they have lost confidence in the government because there was no economic stimulus package in last week's fiscal update.
The Governor General is on a state visit to Europe, but a spokeswoman said she is following the events closely and is ready to return if needed.
The agreement between the Liberals and the NDP is to last until June 30, 2011. The Bloc has agreed to support the arrangement until June 30, 2010, at which point their support could be extended.
Should Prime Minister Stephen Harper's government be defeated - and should Jean accept a coalition agreement - Canada would see its first change of government without an election since 1926.
If the opposition parties - representing just over 54 per of the popular vote in the Oct. 14 federal election - can agree on a written entente for governing, most constitutional experts agree that Jean would have little choice but to invite them to try their hand at government, rather than calling a second election in two months.
But there were rumours the Conservatives might try other tactics, including asking Jean to prorogue Parliament or announcing a stimulus package this week.
Duceppe said nothing can now restore opposition faith in the government.
One Tory MP told his Liberal counterparts Monday that Harper has ruled out attempting to prorogue until he can deliver a budget Jan. 27.
The embattled prime minister told the Commons that Canadians will question "overturning the results of an election a few weeks later in order to form a coalition nobody voted for and everybody denied.
"And to have a coalition like that that can govern only with the veto of the people who want to break up this country," Harper continued. "Do they really believe that is in the interests of this country?"
It was total about-face for Harper who advised the Governor General in 2004 to let him govern - supported by the separatist Bloc - should the Liberal government of Paul Martin fall.
Liberal leadership contenders Michael Ignatieff, Bob Rae and Dominic LeBlanc said they will continue to campaign for the party reins in the run-up to a scheduled May 2 leadership convention.
New Democrats and the Bloc Quebecois had already stated that the Liberals would lead any coalition government, and it was up to that party to decide on the prime ministership.
Settling the leadership question puts in place another piece of the puzzle as Liberals, New Democrats and the Bloc Quebecois hammer out an alternative government.
Liberal MP John McCallum disputed what one source said was a $30-billion stimulus package. He suggested the coalition plan remains a work in progress but could pump money into the forestry and manufacturing sectors, public infrastructure, and even direct payments to citizens.
New Democrats have dropped their demands for the repeal of corporate tax cuts, added McCallum.
Under the deal, a tight coalition cabinet of 24 members would have 18 Liberals and six New Democrats.
What has not been agreed to is where NDP Leader Jack Layton - or other New Democrats - would sit around the cabinet table.
A Liberal source said the plan also involves an economic advisory panel of experts, including Paul Martin, John Manley Frank McKenna, and Roy Romanow. That was news to one New Democrat intimately involved in the negotiations, who said such a panel might be a Liberal construct but was not part of the tripartite talks.
Harper precipitated the Commons confidence crisis last week with a provocative economic update that provided no economic stimulus for an ailing economy, slashed government spending, and included a poison-pill-proposal to gut public subsidies of political parties.
The opposition parties each called emergency caucus meetings to lay out the working elements of the plan Monday.
The coalition government would depend on Bloc support because the Liberals and NDP together don't command a majority in the Commons.
The developments came after a frantic weekend of closed-door talks and concessions from the Conservative government.
The Tories announced Sunday they would bump up the federal budget date and scrap a second controversial element of their economic plan, while hinting at a stimulus plan in a frantic bid to save itself from defeat.
Finance Minister Jim Flaherty announced the budget will be delivered Jan. 27 - "the earliest date in modern times" - while he simultaneously relented on a plan to ban public service strikes.
Liberal Leader Stephane Dion sent a letter to Michaelle Jean advising that the Harper government has lost the confidence of the House of Commons.
He said the Liberals and NDP - backed by the Bloc Quebecois - have reached a deal to form a coalition for at least 18 months.
"Canadians elected 308 members of Parliament in October, not just Stephen Harper," Dion told a news conference after signing the coalition deal with NDP Leader Jack Layton and Bloc chief Gilles Duceppe.
"We are ready to form a new government that will address the best interests of the people instead of plunging Canadians into another election."
Dion would serve as prime minister until spring when he is to be replaced as Liberal leader.
His letter states that the new government "will effectively, prudently, promptly and competently address these critical economic times."
The pact includes a multibillion-dollar stimulus package for the troubled economy, including support for the auto and forestry sectors.
The opposition plans to vote down the minority Tories in a scheduled confidence vote next Monday. It will then be up to Jean to decide whether to call an election or let the Liberals try to govern.
The opposition parties say they have lost confidence in the government because there was no economic stimulus package in last week's fiscal update.
The Governor General is on a state visit to Europe, but a spokeswoman said she is following the events closely and is ready to return if needed.
The agreement between the Liberals and the NDP is to last until June 30, 2011. The Bloc has agreed to support the arrangement until June 30, 2010, at which point their support could be extended.
Should Prime Minister Stephen Harper's government be defeated - and should Jean accept a coalition agreement - Canada would see its first change of government without an election since 1926.
If the opposition parties - representing just over 54 per of the popular vote in the Oct. 14 federal election - can agree on a written entente for governing, most constitutional experts agree that Jean would have little choice but to invite them to try their hand at government, rather than calling a second election in two months.
But there were rumours the Conservatives might try other tactics, including asking Jean to prorogue Parliament or announcing a stimulus package this week.
Duceppe said nothing can now restore opposition faith in the government.
One Tory MP told his Liberal counterparts Monday that Harper has ruled out attempting to prorogue until he can deliver a budget Jan. 27.
The embattled prime minister told the Commons that Canadians will question "overturning the results of an election a few weeks later in order to form a coalition nobody voted for and everybody denied.
"And to have a coalition like that that can govern only with the veto of the people who want to break up this country," Harper continued. "Do they really believe that is in the interests of this country?"
It was total about-face for Harper who advised the Governor General in 2004 to let him govern - supported by the separatist Bloc - should the Liberal government of Paul Martin fall.
Liberal leadership contenders Michael Ignatieff, Bob Rae and Dominic LeBlanc said they will continue to campaign for the party reins in the run-up to a scheduled May 2 leadership convention.
New Democrats and the Bloc Quebecois had already stated that the Liberals would lead any coalition government, and it was up to that party to decide on the prime ministership.
Settling the leadership question puts in place another piece of the puzzle as Liberals, New Democrats and the Bloc Quebecois hammer out an alternative government.
Liberal MP John McCallum disputed what one source said was a $30-billion stimulus package. He suggested the coalition plan remains a work in progress but could pump money into the forestry and manufacturing sectors, public infrastructure, and even direct payments to citizens.
New Democrats have dropped their demands for the repeal of corporate tax cuts, added McCallum.
Under the deal, a tight coalition cabinet of 24 members would have 18 Liberals and six New Democrats.
What has not been agreed to is where NDP Leader Jack Layton - or other New Democrats - would sit around the cabinet table.
A Liberal source said the plan also involves an economic advisory panel of experts, including Paul Martin, John Manley Frank McKenna, and Roy Romanow. That was news to one New Democrat intimately involved in the negotiations, who said such a panel might be a Liberal construct but was not part of the tripartite talks.
Harper precipitated the Commons confidence crisis last week with a provocative economic update that provided no economic stimulus for an ailing economy, slashed government spending, and included a poison-pill-proposal to gut public subsidies of political parties.
The opposition parties each called emergency caucus meetings to lay out the working elements of the plan Monday.
The coalition government would depend on Bloc support because the Liberals and NDP together don't command a majority in the Commons.
The developments came after a frantic weekend of closed-door talks and concessions from the Conservative government.
The Tories announced Sunday they would bump up the federal budget date and scrap a second controversial element of their economic plan, while hinting at a stimulus plan in a frantic bid to save itself from defeat.
Finance Minister Jim Flaherty announced the budget will be delivered Jan. 27 - "the earliest date in modern times" - while he simultaneously relented on a plan to ban public service strikes.