The Canadian Press, Adrian Wyld/AP
Prime Minister Stephen Harper (left) and Liberal Leader Michael Ignatieff.

Canadian Politicos Avert Government Stalemate and New Election

June 17, 2009 06:00 PM
by Anne Szustek
Canadian Prime Minister Stephen Harper and Liberal Party head Michael Ignatieff have reached an agreement to examine employment insurance reform, quieting fears of a summer election.

Likelihood of Summer Election in Canada Now Lessened

On Wednesday, Harper and Ignatieff entered a second day of negotiations on Canadian employment insurance reform. Thanks to an accord the two men reached on Tuesday, Harper’s Conservative Party can rest easier, given that a no-confidence vote on their administration is now less likely.

Ignatieff warned the Conservatives on Monday that unless he got “clarity” on the state of unemployment benefits, stimulus package accounting, budget balancing and how the country will source much-needed medical isotopes, Friday’s budget vote would have effectively also been on the ruling party’s fitness to govern.

Should that scenario transpire—still possible, although much less probable at this point—Canada would hold elections for a new government after a period of at least five weeks, most likely on July 27. If the agreement holds, Canada’s Parliament would go into summer recess and no election would be held before November of this year.

Ignatieff, or “Iggy,” as he is known, and Harper have been at an impasse regarding unemployment benefits reform. Harper maintains that the jobless benefit plan recently rolled out is plentiful; it includes C$500 million ($421.4 million) for job retraining of older workers. The Liberals want a uniform eligibility standard that would grant benefits to anyone who has worked at least 360 hours in the past 52 weeks. The two other opposition parties, the New Democrats and the Bloc Québécois, argue that unemployment benefits should be expanded and effective even after the current recession lets up. Harper has said that such a plan would prove to be too costly. Tuesday’s agreement establishes a bipartisan working group to examine the issue of EI reform.

Observers see the agreement as a win-win for both parties. “Given Canadians’ deep opposition to a summer election, the best outcome for Ignatieff is an understanding with the Prime Minister,” writes Chantal Hébert in the Toronto Star. “As it happens, it is also the best possible outcome for Harper.”

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Background: June 2009 standoff not Harper’s first political trial

Harper and his Conservatives have been in a tug-of-war with the political opposition over the past several months. His opponents claim that the current administration has not decisively promoted efforts to buffer the Canadian economy; for example, last fall, the Liberals condemned Finance Minister Jim Flaherty’s statement that he would wait until 2009 to examine the national budget and consider a stimulus package. 

The Conservative Party under Stephen Harper first gained government control during Canada’s elections in early 2006; it was reelected in an early vote on Oct. 14, 2008, with a slight gain in seats, although neither instance gave the party an outright legislative majority.

This has left the Conservative Party open to risks of no-confidence votes and bids to overturn its power. Another of Harper’s actions that rallied his political opponents was a bid to halt public party financing; opposition parties tend to rely more on such financing than do the Conservatives. The Liberals, New Democrats and the Bloc Québécois began planning a coalition government last fall that could have bumped the Conservatives out of its ruling plurality. Harper later rescinded the proposal and remained in power.

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