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Failed federal budget could trigger May election

The Conservatives believe they have put forward a budget that will help the fragile economy recover with small steps.

The NDP are sore social programs like Guaranteed Income For Seniors and Canadian Pension Plan reform weren't fully acknowledged.

The Liberals and Bloc Quebecois are intent on bringing down the minority government for their own reasons.

It all amounts to a date at the polls for Canadians, unless some last minute amendments can be made to avert an election after the Conservative government announced its budget Tuesday.

None of the opposition parties supported Finance Minister Jim Flaherty's financial plan.

"By not supporting it, the NDP have really passed off the decision to bring down the government to the Liberals," said Allan Warnke, a political science professor at Vancouver Island University. "The Liberal caucus meeting [Wednesday] morning will ultimately decide if there is an election. From a political standpoint, it's quite a situation."

Jean Crowder, Nanaimo-Cowichan NDP MP, said her party could have supported a budget that included $700 million in guaranteed income for seniors and an effort to double CPP over the next several years.

Instead, there was no mention of CPP improvements and the Conservatives only allowed for $300 million in GIS funding.

"People get GIS because they're struggling, they don't have enough money," said Crowder. "To give them $50 extra a month is not going to make a substantial difference in their lives. We know there are more and more seniors living in poverty."

Crowder said the NDP also couldn't support $220 million in cuts to Human Resources and Skills Development Canada over the next three years.

"In Nanaimo-Cowichan, which has one of the highest unemployment rates, this service is extremely important," she said. "It handles programs like [Employment Insurance]. They're proposing some radical cuts to governement departments that will have an impact on us right here in our riding."

NDP leader Jack Layton was also looking for eliminating the five-per cent GST on home heating bills, including natural gas, oil and wood. He didn't get it.

Nanaimo-Alberni Conservative MP James Lunney defended the budget, saying many of the programs announced Tuesday would help Canadians continue to claw their way out of the recession.

Along with the $300 million in GIS spending, Flaherty announced a reinstatement of the previously shelved ecoENERGY Retrofit-Homes Program that would earmark $400 million for Canadians who make their homes more energy efficient, plus an additional $470 million to fight climate change, a Family Caregiver Tax Credit which would save people caring for sick or disabled relatives about $300 annually, and around $9 million in student loan forgiveness for doctors and nurses willing to work in rural and remote areas.

Lunney said it is a transitional budget that would move the country back to a balanced budget by 2015.

"For us it's about getting the right budget for the right time," he said. "We cannot spend a lot of money right now. We're targeting our spending very strategically to help those with the biggest needs. It's about keeping people working and protecting jobs and driving the economy."

Other business-oriented help includes a tax credit on 15 per cent of $3,000 for volunteer firefighters who put in 200 hours of service; hiring incentives for small business by offering up to $1,000 in the cost of EI premiums for new employees, and extended capital cost allowances to encourage the manufacturing industry to update machines and tools; and the introduction of the Helmets to Hardhats Program to provide training for troops returning home from combat missions.

Some of the cuts, however, will hurt the Nanaimo area. The government proposed to cut the Department of Fisheries and Oceans by $9 million this year, $18 million in 2012 and $56 million by 2013.

"DFO is taking a big hit, which is a big worry for this area," said Crowder. "They're under-resourced locally anyway. With the fish farms, and the salmon and the other issues, that one just sent up all kinds of red flags for us. With a fragile economic recovery those do not seem like places to be cutting."

Crowder said there is still a possibility for amending the budget in the next few days, which could avert an election if at least one opposition party likes what it sees.

If that fails, Canadians could be heading to the polls as soon as early May.

"It surprises me a little that the NDP came out right away not supporting it," said Warnke. "I thought there were at least two good items — support for low income seniors and support for doctors — that would have at least made them consider a decision a little longer," said Warnke.

The entire budget highlights can be viewed at www.gc.ca.

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