September 4, 2009 / 7:59 PM / in 8 years

Liberals, Conservatives duel over recovery

<p>Canadian Prime Minister Stephen Harper speaks at the opening ceremonies for the World Skills Competition in Calgary, September 1, 2009.Todd Korol</p>

VANCOUVER, British Columbia (Reuters) - Liberal leader Michael Ignatieff and Conservative Finance Minister Jim Flaherty dueled on Friday over the health of Canada's economy and the impact of a possible autumn election.

Flaherty accused Ignatieff of "fighting the recovery" and pushing for an "unnecessary" election.

Ignatieff, the leader of the main opposition party, dismissed claims the economy was rebounding and rejected the contention that a recovery posed a political dilemma for the Liberals.

"There is nothing (in an election) that would jeopardize recovery. Our recovery is halting and slow under this government," Ignatieff told reporters in Vancouver, where he was scheduled to hold a campaign-style rally.

"We think we could accelerate recovery and make it more effective," Ignatieff said.

The Liberals this week said they would stop supporting Prime Minister Stephen Harper's minority Conservative government, setting the stage for a possible election this autumn.

The Conservatives contend an election would damage the economy, and accused the opposition of trying to force Canadians to the polls now because they are worried about the political fallout of better economic times.

"We're interested in fighting the recession. We're not like the leader of the opposition," Flaherty said.

An election is not a foregone conclusion, because the Conservatives may still be able to reach a deal with either the New Democratic or Bloc Quebecois parties, allowing them to stay in power.

Public opinion polls have indicated that neither the Conservatives or Liberals are likely to win a majority government, and many voters oppose the idea of going to the polls no matter which party they support.

Flaherty, who is in London for a meeting of G20 finance Ministers, said he expects to outline his plans to bring the federal budget back into surplus in a report to Parliament that he may deliver as early as this month.

Flaherty will release the plan in one of the quarterly updates on economic recovery that it agreed to make under the now-scrapped deal with the Liberals that has allowed them to remain in power this year.

Ignatieff dismissed the suggestion the Liberals could suffer if the plan came out before the Liberals have a chance to force an election. He said earlier government claims about the status of the recovery proved untrue.

"There is a basic fundamental problem of credibility with this government," Ignatieff said.

The Conservatives may have gotten a boost on Friday from data showing the country unexpectedly added jobs in August and purchasing by businesses grew at a faster pace than forecast.

"The question is not whether Canada is going to get out of the recession. ... The question is who can lead Canada into recovery, into the new economy," Ignatieff said when asked about the economic numbers.

(With reporting by Louise Egan in London, David Ljunggren in Ottawa)

Editing by Frank McGurty

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