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Hard-hit communities to get $1-billion relief fund

Five cabinet ministers set off across country to advertise stimulus package in advance of Tuesday's budget announcement in Ottawa

From Saturday's Globe and Mail

OTTAWA — The Harper government's prescription for Canada's economic ills will include a $1-billion fund to help resource-dependent cities and towns survive the downturn.

The money — to be officially unveiled in Tuesday's budget — will be funnelled through regional development agencies, giving them a key role in helping smaller communities weather the recession.

The fund is the centrepiece of nearly $2-billion in budget measures that Conservative cabinet ministers pre-announced Friday, four days before what could be one of the biggest stimulus packages in Canadian history.

The strategy behind the advance notice was to spread good news over several days rather than risk parts of next week's budget being lost in the flurry of unveiled spending.

Natural Resources Minister Lisa Raitt was one of five Harper ministers who fanned out across Canada Friday to advertise spending. She said in Nova Scotia that the fund would be flexible in application and help sectors such as forestry "adjust to the changing economic climate."

The new fund is a successor to a 2008 Community Development Trust, also worth $1-billion, set up to provide similar aid. Previously, cash was handed out through the provinces.

Ms. Raitt also said she expects an additional $150-million for other forestry initiatives, including more than $100-million to develop new uses for forest products and $50-million to help promote the industry abroad as environmentally responsible.

Other announcements are:

*About $550-million for farmers, including half a billion to help adjust to tough times and $50-million to expand slaughterhouse capacity;

*Tens of millions of dollars in new funding for northern economic development, including $10-million for a new regional development agency;

*A new development agency for Southern Ontario.

Friday was the second day of budget pre-announcements. On Thursday the government disclosed it will run the biggest deficits in more than half a generation: $64-billion over the next few years. That was an attempt to get news of the deep shortfalls out of the way before it introduces the budget that will determine the fate of the minority government.

Liberal Leader Michael Ignatieff criticized Prime Minister Stephen Harper Friday for releasing details early. "I asked Mr. Harper not to play games like that," he told 500 people at a luncheon of the Canadian and Empire Clubs in Toronto. "I told him to put the facts and figures on the table, not let them slip out at his convenience. But the guy just can't help himself."

Mr. Harper and U.S. President Barack Obama spoke by phone Friday and set the economy, Afghanistan and the environment as the key issues for discussion during the U.S. leader's visit to Canada, his first foreign trip as President.

Quebec, meanwhile, ramped up attacks on Ottawa for a move nearly three months ago to limit the growth of equalization payments. Quebec's Finance Minister, Monique Jérôme-Forget, accused the Conservatives of taking an "authoritarian approach" that contradicts Mr. Harper's pledge to restore "fiscal balance" in wealth sharing with provinces.

With reports from Bill Curry, Michael Valpy, Campbell Clark and David Ebner

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