Canada opposition signs deal to defeat government

The leaders of Canada's three opposition parties on Monday signed a historic deal to bring down the minority Conservative government and then form a coalition government of their own.

The Liberals, New Democrats and separatist Bloc Quebecois say the Conservatives of Prime Minister Stephen Harper -- who won a strengthened minority in an Oct 14 election -- are not doing enough to help Canadians cope with the worsening financial crisis.

One of Harper's ministers called the deal "a coup d'etat" and suggested the government could temporarily shut down Parliament in response. Another minister said the country was in "a very, very serious situation."

In a scene unprecedented in Canadian political history, the Liberals and New Democrats sat down in one of Parliament's most stately rooms and signed a formal coalition deal.

The two parties, vowing to work together until June 30, 2011, will split cabinet posts. The Bloc signed an agreement promising to back a coalition government for at least 18 months.

A confidence vote has been set for next Monday. The proposed coalition government would be the first of its kind in modern Canadian history.

"We're seeing a sad spectacle from Stephen Harper's government. ... (It) has shown it has no plan, no competence and no will to face up to the crisis," Liberal leader Stephane Dion said at a news conference after the signing.

"The opposition parties have decided it is time to take action. ... We're ready to form a new government."

The opposition promised a stimulus package that would help the economy for two years and said they would help the ailing auto sector.

The parties agreed that Dion -- who led his party to a big defeat in the Oct 14 election -- would head a coalition government if it were formed.

Given Dion's poor campaign performance, the choice is likely to be controversial. He has already agreed to step down next May once a replacement is chosen.

The leaders said they would focus on the economy and ignore other deep policy differences.

They said their government would not introduce a carbon tax -- Dion's commitment to do so in the last campaign hurt him badly -- and would not cut short the nation's military mission to Afghanistan, which is due to end in 2011.

Bloc leader Gilles Duceppe -- who wants independence for the French-speaking province of Quebec -- said the crisis was for now the most important matter to be addressed.

The parties are also angry that Harper last week proposed to end public financing for political parties, a move that would have hit the opposition particularly hard. The opposition said that move showed they could no longer trust Harper, who took power after the January 2006 election.

"I urge you to accept this gracefully, to accept the new role you'll be playing in the House of Commons," said New Democrat leader Jack Layton, calling on Harper "not to create further instability."

Harper, speaking before the deal was signed, accused his rivals of trying to subvert democracy.

"I'm sure all Canadians will really ask themselves whether overturning the results of an election a few weeks later in order to form a coalition that nobody voted for ... and can govern only with the veto of the people who want to break up this country -- do they really believe that is in the interests of this country?" he told Parliament.

Some speculate that Harper could go to Governor-General Michaelle Jean -- representative of Canadian head of state Queen Elizabeth -- before the confidence vote and ask her to temporarily suspend Parliament.

If he loses the vote next Monday, he will be obliged to see Jean and will most likely ask for new elections. Constitutional experts says she would almost certainly turn him down and ask the opposition if they could govern.

The deal calls for a 24-member cabinet, with 18 seats going to the Liberals and six to the New Democrats.

The chaos has knocked down the value of the Canadian dollar and there is potential for more uncertainty as markets digest the fact the next government could have to rely on the support of a party dedicated to breaking up Canada.

The Liberals and New Democrats have a total of 114 seats in the 308-seat Parliament. The Conservatives have 143.

The Liberals have governed Canada longer than any other party, while the New Democrats have never been in power federally.