The Conservative government has its back against the wall a little more than a month after the federal election as opposition parties have been working to form a coalition government and take the reins of power on Parliament Hill as early as Monday.

Conservatives were left scrambling and backtracking today after news broke that the opposition parties were busy making plans to form a coalition government to overthrow Prime Minister Stephen Harper's minority government with a non-confidence motion Monday.

The discontent began when Finance Minister Jim Flaherty's economic and fiscal statement didn't include any indication of plans for economic stimulus, but did include a cut to public funding for political parties based on the number of votes they take in an election.

Late Friday afternoon, Harper took action to avoid the non-confidence motion by moving all motions on the economic statement until Dec. 8 at the earliest.

The move is ostensibly made to give Canadians more time to absorb the extraordinary developments that could result in an NDP-Liberal coalition government. But it also buys the Conservatives time.

Meanwhile Conservative MPs are busy trying to put a positive spin on the economic statement and spread the word about what the government plans to do about the waning Canadian economy.

In Simcoe-Grey, MP Helena Guergis cancelled a scheduled telephone interview about the Throne Speech with media slated for Friday afternoon and later released a statement about government's position on the economy.

"During a period of economic uncertainty we must work to ensure every tax dollar is being spent wisely," said Guergis. "That is why our government is committed to restraining discretionary government spending in a wide range of non-priority areas."

The release from her office went on to explain what actions the government is planning to take including:

•Reduce the cost and ensure the effectiveness of government operations.

•Ensure sustainable federal public sector wage rates and modernize the pay equity regime. This will also apply to MPs, Senators, Cabinet Ministers and senior public servants.

•Put Equalization on a sustainable growth path.

She also wrote that the government will consult with provinces and territories, and all Canadians, to develop responses to short term economic issues, while continuing to implement its long-term economic plan.

The immediate priorities are to accelerate infrastructure projects, improve opportunities for workers and sectors affected by current economic conditions, strengthen our world-leading financial system in line with our G20 commitments, and improve the competitiveness of the Canadian economy.

Although the Conservative backed down on plans to discontinue public funding of political parties the opposition parties remained steadfast in their plans to take control of the government through a coaliton.

NDP Leader Jack Layton and Stephane Dion have discussed "roles and responsibilities" in a new coalition, an NDP official confirmed.

It is expected that Layton would have a place in the new cabinet, and "various players would play different roles," the official said.

Liberal finance critic John McCallum said a new government would roll out a stimulus package that was "a whole lot faster and a whole lot bigger than anything they would provide."

"The Liberals are absolutely united in voting against the measures contained in the fiscal update. They (The Conservatives) did nothing to stimulate the economy. When every other country in the world is into this in the tens or hundreds of billions of dollars, the Harper government cuts," McCallum told reporters outside the House of Commons.

"It's entirely unacceptable when Canada is in the middle of its worst economic crisis since the 1930s. We cannot live with that. We cannot accept that. We will vote against it. We are all determined on that point."

NDP leader Jack Layton contacted former NDP leader Ed Broadbent last night to seek his counsel as a "statesman," party spokesman Karl Belanger said, and asked him to contact former Liberal leader Jean Chretien to attempt to chart a way forward.

Today, Broadbent confirmed he spoke with Chrétien, but declined to discuss any specifics of their conversation, as did Chretien.

"He and I both discussed what would be a good situation here for the people of Canada, for Parliament and we'll see what happens," Broadbent told reporters after a morning meeting in Layton's office.

Broadbent said he shares Layton's main concern: "The stimulative package is a joke in global terms."

Broadbent condemned Harper's update for failing to offer anything approaching the "minimum" spending of 2 per cent of GDP - a measure of a nation's economic output - that "other countries around the world are following."

"All the Opposition parties are deeply concerned about the economic well being of the people of Canada. And this government completely misjudged the situation."

Prime Minister Stephen Harper did not appear in Question Period, as is his custom on Fridays, but huddled in his third floor offices with advisors.

Word circulated the government had "backed down" by removing the poison pill of cuts to taxpayer subsidies for political parties in a ways and means motion flowing from the economic update, that will be voted on Monday.

But the Conservatives continued to talk tough.

In Toronto, Finance Minister Jim Flaherty said the cuts, which amount to about $28 million and would hit the Liberals, BQ and Green parties the hardest, were never put in the motion "because it's not an income tax measure."

Still, Flaherty said it will be included in a later implementation bill.

"People of Canada clearly viewed our party as the best party to steer our country through what is a serious economic downturn," he said. "This is the financial plan of the government of Canada. This is a matter of confidence."

Meanwhile, coalition talks took shape.

BQ leader Gilles Duceppe told reporters he laid out conditions for Bloc support for a coalition, and that he is quite open to the idea.

"We said that we won't be part of a coalition and having ministers from the Bloc; this is very clear. But we'll consider a coalition that would respect more Quebec values and interests."

Duceppe has had meetings with Layton and Dion, and still wants "stimuli concerning economy, to have a real plan for manufacturing and forestry sector, to have a better conditions for the employment insurance and so on."

"We had meetings. I discussed with Jack Layton yesterday and Stéphane Dion. But we're having those discussions looking at if we can come to an agreement but we'll take the time we need."

Liberal leader Stéphane Dion was not in the Commons, but was holed up in Stornoway.

As Liberal MPs filed into Question Period, they vowed to vote against the government on the motion as an expression of non-confidence in the government.

"We're not going to accept it the way it is," said Liberal MP Marc Garneau. He said the political funding "is a red herring."

"The issue is the economic plan. What is this government going to do? The rest of the world is moving forward on measures to address concerns about job losses and security for people's pensions and their savings, so those are the things we want to see the government address."

The Conservatives accused opposition parties of coming together in an "undemocratic" coalition for the sole purpose of protecting their funding.

"It's highly undemocratic, it's not supportable. The public would never accept having an election over their political entitlements at a time like this," said Kory Teneycke, Harper's director of communications.

"So they're trying to find a way to change the government to keep their money without actually having to face a democratic process," he said, adding that the Liberals have no mandate to govern after one of their worst electoral showings in a generation.

However Broadbent scorned Harper's comments.

"He's saying that with less than 39 per cent of the vote? In 80 per cent of the countries in the world he'd be out there in Opposition. All the Opposition parties got a much larger share of the vote than Mr. Harper did."

Broadbent recalled how then-Liberal leader Pierre Trudeau wanted him to go into a coalition with him in 1980, after the election when Trudeau sought him out to join cabinet in order to gain support for the Liberals' national energy policy and repatriating the constitution.

Broadbent asked for a few more NDP members in cabinet, which Trudeau agreed to, but Broadbent ended up saying no for fear of losing his credibility.

 "I learned from that that was a majority government and it would have been a mistake," said Broadbent yesterday.

"This is a minority government and it would not be a mistake."

Teneycke made clear that Conservative government would not back down. Nor does it intend to rush in a stimulus package in the coming days to address the opposition's complaints, Teneycke said.

"We are going to stand our ground on principle. I'm saying we're not backing down," he said.

"The thought that changing the government, which takes months, is going to speed up anything in terms of addressing the economy is just not supported by any of the facts," he said.

He refused to answer whether the Conservatives misjudged opposition opinion by bringing forward such a contentious economic statement.

Conservatives who spoke off-the-record appeared surprised that Harper's gambit appeared to bring the government to the edge of a cliff, little more than a week after the 40th Parliament began sitting. Several speculated that Harper may have thrown in too many controversial measures in one economic package.

The Conservatives who spoke for the record dismissed questions about whether Harper had miscalculated.

"There's no risk," said Conservative MP Rick Dykstra. "This is a pragmatic approach to governing, and it's not time for taxpayers to foot the bill (for political parties).

"If the Liberal party is intent on forming a partnership with the separatist party of this country, that's their decision to make."

Gerald Keddy, parliamentary secretary for international trade, said the government was not "playing partisan games here." He ridiculed the Opposition parties who campaigned on spending promises that added up to about $50 billion each.

"We don't have that kind of money in the cupboard. It would be great if we did. So that would mean going into deficit. That is our least preferable option. It's not one that the prime minister or the finance ministers have totally discounted. But it's certainly not where we are going at the beginning of the day."

Liberal finance critic Scott Brison said it is too early to say whether the opposition parties will form a coalition or hammer out a formal accord but said Harper was wrong to think diluting the party financing issue would save his government.

"We're a long ways from pre-nup agreements," Brison said. "The fact is that Mr. Harper has successfully in some ways changed the channel from this debate from one of economics and people to one of politics. We're turning it back."

Liberal MP Maria Minna said the opposition parties would have to wait and see what Harper would do.

"I think realistically they do have to talk because obviously the prime minister has decided to play brinkmanship with the country," she said.