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OTTAWA (Reuters) - The minority Conservative government played down talk on Sunday that it was close to striking a deal that could help it survive a number of nonconfidence votes in the weeks to come.
The Conservatives, beset by ethical scandals, will present their budget on Tuesday and need the backing of one of the three opposition parties to approve the document.
If they fail and are defeated, Canada will be on course for its fourth election in less than seven years.
The opposition Bloc Quebecois, which seeks independence for the largely French-speaking province of Quebec, says it will back the budget if Ottawa hands over C$2.2 billion ($2.2 billion) for costs involved in harmonizing the provincial sales tax with the federal one.
Raymond Bachand, Quebec's finance minister, said he had initialed a draft deal on tax harmonization and was waiting for federal Prime Minister Stephen Harper to do the same.
"As far as I'm concerned, it's finished," he told Quebec's TVA television on Sunday when asked whether the talking between the two sides had been concluded.
Senior federal officials said there was no deal yet.
"Discussions are ongoing in good faith with the government of Quebec but some points still remain unresolved and there's a fair bit more work to do," said Chisholm Pothier, chief spokesman for federal Finance Minister Jim Flaherty.
Harper's other hope for support is the left-leaning New Democrats, who want more help for seniors, more doctors and nurses in the health system as well as an end to the federal tax on heating oil.
Flaherty says he cannot meet all these demands, but Ottawa may be tempted to reconsider after a series of scandals that have reinvigorated the opposition, despite polls showing the Conservatives would retain power if an election were held now.
Last week police were asked to investigate allegations of misconduct by a former top Harper aide as well as by a former aide to a cabinet minister. Last month, four Conservative officials were charged with violating financing rules during the 2006 election campaign that brought the party to power.
The main opposition Liberal Party says the government cannot be trusted and is spending too much money. The Liberals promise to raise corporate taxes and cancel a C$9 billion deal to buy fighter jets from Lockheed Martin.
Legislators will have the chance on Friday to defeat the government over its spending plans. The Liberals will have the right that day to unveil a nonconfidence motion that would be voted on immediately.
Liberal leader Michael Ignatieff said the Conservatives had provided "a target-rich environment" for his party during a campaign but was coy when asked when the election might be.
"I honestly don't know what's going to happen this week but I'm ready for anything. We could go (to the polls) this week or next year," he told CTV television on Sunday.
Additional reporting by Allan Dowd; Editing by Paul Simao