Harper boxed in by RESP bill

Liberal MP Dan McTeague has pulled a fast one on the Harper Conservatives. His private member's bill that would allow parents to set aside up to $5,000 taxfree each year in a RESP made it through the Commons with the support of the three Opposition parties. It now goes to the Senate where it will undoubtedly be approved by the Liberal-dominated body. That will give it the force of law once the formalities are dealt with.

This will put the Harper government in an interesting conundrum. Today's story in the Globe and Mail lead with the following:

"OTTAWA — The Harper government vowed Thursday to kill legislation introduced by a Liberal MP and quietly passed by the House of Commons that would allow parents to contribute up to $5,000 a year to their children's education and deduct it from their income tax."

Not exactly an opportune position to be in for a government that favours tax cuts. Having squandered the surpluses left by the Liberals and given away a major source of revenue by reducing the GST by 2%, they are already in a precarious position for the coming year faced with a declining economy. (Incidentally I haven't heard anyone singing their praises for the GST reduction, have you?) So they say they will oppose a law passed by the Commons and (probably) the Senate, claiming poverty.

To do this they will have to play tricks by introducing a technical amendment to the budget (killing the RESP proposal) and proclaim it a confidence measure in order to force the Liberals to let it pass, thereby killing McTeague' initiative. But the Conservatives will end up with egg splattered all over their faces by killing what would be a popular measure.

The Liberals could do worse than defeat the Conservatives' attempt to kill this bill and take their chances on an election. With Harper still stinging from the Cadman affair and NAFTA-gate, the bloom might well be off the Harper rose.