Parliament buildings in winter
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The Liberals and New Democrats have reached an agreement that would see the NDP support Justin Trudeau’s minority government through to 2025.

The deal is a “confidence and supply” agreement effective immediately, Trudeau said Tuesday.

This kind of agreement, a version of the deal the British Columbia NDP struck with the Greens in that province in 2017, generally involves an opposition party agreeing to support the government on confidence motions and budget or appropriation votes for a certain period of time.

During a news conference announcing the deal, the prime minister cited the global and economic instability caused by Russia’s invasion of Ukraine as well as the results of last September’s federal election as catalysts of the new arrangement.

The Liberals failed to win a clear majority in the election and currently hold 159 of the 338 seats in the House of Commons, while the NDP has 25 MPs.

Tax-related priorities cited by the parties

The Liberals and the NDP have agreed to prioritize several issues on which they agree. The issues related to taxation, investing and the financial services industry include:

  • What the parties have called “fair taxation measures,” including changes for financial institutions that have made strong profits during the pandemic;
  • A $500 one-time top-up to the Canada Housing Benefit in 2022, which would be renewed in coming years if cost of living challenges continue;
  • A publicly accessible beneficial ownership registry by the end of 2023;
  • A Safe Long-Term Care Act to ensure seniors are guaranteed care, no matter where they live;
  • Implementing a Homebuyer’s Bill of Rights and “tackling the financialization of the housing market by the end of 2023”;
  • Introducing an Early Learning and Child Care Act by the end of the year, ensuring that child-care agreements have long-term protected funding that prioritizes non-profit and public spaces;
  • A new dental-care program for low-income Canadians that would begin with those under 12 this year, then expand to others in phases by 2025;
  • Progress on a universal national pharmacare program by passing a Canada Pharmacare Act by the end of next year and then having the National Drug Agency develop a national formulary of essential medicines and bulk-purchasing plan by the end of the agreement.

Trudeau said that on areas where the Liberals and NDP do not agree, such as a potential increase in defence spending in response to Russia’s attack on Ukraine, such situations will be managed on a case-by-case basis. He added the NDP does not have a veto.

Singh was scheduled to address reporters later Tuesday morning.

Interim Conservative leader Candice Bergen, whose party is in the midst of a leadership race, blasted what she described as a “backroom deal that would see Justin Trudeau get the majority power that he tried desperately to get last fall in the last election, but he failed to get.”

Bergen proceeded to accuse the Liberals of having effectively given the reins of power to the NDP, which she alleged would lead to massive government spending and the death of Canada’s oil and gas industry.

“All of which, for Canadians, means more debt, more inflation, more jobs lost, more uncertainty, and frankly, more polarization,” she added. “This is not a good day for Canadians.”

While he also condemned the deal for giving the Liberals a “false majority,” Bloc Quebecois Leader Yves-Francois Blanchet said the agreement would not change his party’s approach in Parliament.

“The Bloc will keep doing exactly the same thing: if it’s good for Quebec, we will vote in favour. If it’s bad for Quebec, we will vote against,” he said.

Blanchet said he spoke briefly to Trudeau on Tuesday morning before the prime minister announced the deal publicly, but that he was not asked to join the arrangement.

However, Blanchet did raise the spectre of increased support for Quebec independence if the Liberal-NDP arrangement consistently works against the interests of Quebecers.

The Bloc’s public support for a proposed coalition government orchestrated in 2008 by then-Liberal leader Stephane Dion and NDP counterpart Jack Layton was partly responsible for scuppering the effort to replace Stephen Harper’s minority Conservative government.

If it works out, the deal announced Tuesday will spur progress on NDP policies, which the party can cite as a track record in the next election, said Karl Belanger, president of Traxxion Strategies and former interim national director of the NDP.

Because the deal isn’t a formal coalition, the NDP will be able to continue to operate as an opposition party with its own identity, he said.

“The key battle between the Liberals and the NDP will be about who will be able to take credit for these initiatives. It has not always worked out for the NDP in the past,” Belanger said.

The deal will also buy the NDP time to build up its war chest for the next election, and show that the party is relevant in the meantime, he said.