The Conservative budget cleared its first hurdle Thursday evening as Parliament rejected a Bloc Quebecois amendment to extend EI eligibility and lend more support to the forestry and manufacturing sectors.
The Bloc amendment also aimed to derail a pan-Canadian securities commission and accused the Tories of giving tax cuts to the wealthy.
But only the Bloc and the NDP voted in favour of the changes, which would have eliminated contentious tax cuts for middle-class Canadians.
The Bloc amendment also included a section to "maintain the right of women to settle pay equity issues in court," which became a hot-button issue during the Conservatives' fiscal fall update as the opposition accused the Tories of attacking women's rights.
The Bloc amendment vote comes four days before the House votes on Liberal additions to the budget.
Meanwhile, Grit Leader Michael Ignatieff announced Wednesday that his party would support the Tory budget -- for a price.
Grits to support budget
The hitch, Ignatieff said, was that the Conservatives would be required to provide three updates over the next year on the economy and the implementation of the budget.
The amendment, requiring reports in March, June and December, will go to a vote on Monday and is expected to pass.
Meanwhile, the New Democrats have produced a series of scathing radio ads that blast Ignatieff for propping up the Conservatives.
The NDP and Liberals had earlier formed a coalition, with the support of the Bloc Quebecois, to bring down the government -- a plan Ignatieff has since backed away from.
The ads claim Ignatieff has failed his first major test as a leader, proving NDP Leader Jack Layton is the only one willing to take a stand against Harper.
"The simple message they want to get out is if you don't like Stephen Harper look to the NDP. The Liberals aren't the party you should be looking to, they're clones of the Tories so vote NDP," said CTV's Roger Smith.
Liberal gains in Quebec
Earlier Thursday, a new poll showed the Liberals establishing a strong lead over the Conservatives in Quebec, and even challenging the Bloc Quebecois in the all important province.
The CROP poll published in La Press shows the Liberals with 31 per cent support in the province, creeping up on the separatists' 34 per cent and leaving the Conservatives behind with just 16 per cent support.
"This is terrible news for the Conservatives," said CTV's Ottawa Bureau Chief Robert Fife. "As Brian Mulroney used to say, you cannot win a majority government in this country without Quebec."
On the other hand, the numbers are great news for Ignatieff.
He's looking strong just one day after putting his amendment on the Conservatives' federal budget, and seems to be gaining popularity in Quebec, where he has a good relationship with Liberal Premier Jean Charest.
He suggested the shift in strength is a result of Harper's misjudgement during the last election, and Ignatieff's effective maneuvering in the province.
"This bodes very well for the Liberal party in Quebec," Fife said.
However, he pointed out that if the Liberals continue to pose a serious threat to the Bloc, it's possible that leader Gilles Duceppe will shift his support to the government.
Budget amendment
Earlier Thursday, Industry Minister Tony Clement said the Liberals' budget demands are reasonable.
"We had every intention of updating both Parliament and the Canadian people on our progress with respect to this budget," Clement said Thursday.
Ignatieff had said the budget was "flawed" because, among other things, it fails to extend EI eligibility, attaches strings to infrastructure dollars that may delay projects and jobs, and lacks a credible plan to get out of the deficit situation.
However, he said the budget includes important concessions such as affordable housing, skills development and measures to make credit available to businesses.
It also includes measures to provide a tax rebate to Canadians who undertake renovation projects.
Clement said that even by the time the government is required to deliver its first report in March -- in less than two months -- there will be progress to report.
Clement acknowledged, however, that some measures such as infrastructure spending, will take longer to implement and may not be in place by the first scheduled update.
"Rome wasn't built in a day nor will all of Canada's infrastructure be built in a day and I think Canadians will be realistic."
Meanwhile, Newfoundland and Labrador Premier Danny Williams launched a public relations campaign to stall budget changes that will alter equalization payments under the Atlantic Accord.
Williams has said that his province stands to lose $1.5 billion over three-years, and he petitioned Ignatieff to stand up against Harper over the changes.
"(Ignatieff) acknowledged there was a very serious problem," said Williams Thursday, adding that he has support of premiers from other Atlantic provinces.
With files from The Canadian Press
