Budget set for Feb 26, could spark election

Mon Feb 11, 2008 5:52pm EST
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By Randall Palmer

OTTAWA (Reuters) - The minority Conservative government will present its 2008-09 budget on February 26, a document that could trigger an election in mid-April.

After Finance Minister Jim Flaherty announced the budget date in Parliament on Monday afternoon, he took note of the uncertain times, and promised to stay out of deficit.

"In this budget, we will be doing what households and businesses do when things are uncertain: we will be acting in a responsible manner," he said.

"So this is a time ... of limited economic growth where you have to have a solid hand on the tiller and you have to be very careful on the spending side and manage things well."

The Conservative government, elected in January 2006 after more than 12 years of Liberal rule, has already warned that the budget will not contain big tax cuts or spending programs.

If the budget is not passed, the government will fall and there will be a federal election, most likely on April 14, although Prime Minister Stephen Harper could set it for some time after that.

Since Flaherty already unveiled C$60 billion ($60 billion) in tax cuts over five years last October, he said he would spend much of his time in this month's budget recounting the accomplishments of the Conservatives' two years in power.

"Canada is in the best position, really, of the G7 countries to go through what are more difficult economic times," he said, speaking of the Group of Seven leading industrialized nations.   Continued...

<p>Canada's Finance Minister Jim Flaherty speaks to journalists following Question Period on Parliament Hill in Ottawa February 11, 2008. REUTERS/Chris Wattie</p>