06/18/2012 07:13 EDT | Updated 08/18/2012 05:12 EDT

Opposition votes down another part of Ont. gov't budget

Opposition members voted down a budget schedule today in defiance of Premier Dalton McGuinty’s weekend warning to New Democrats to stop making major changes to his government’s budget.

The finance committee was voting on four budget schedules on Monday, which would change arbitration for firefighters, police, Toronto Transit Commission staff and essential hospital staff.

However, the New Democrats and Progressive Conservatives on the committee on Monday afternoon voted down Schedule 22, which would have changed the rules on contract arbitration for firefighters.

The vote came hours after NDP Leader Andrea Horwath said that she was willing to compromise and allow the budget to pass.

At an early morning news conference Horwath said she was proposing "a path forward."

"My caucus and I will be allowing the final budget bill to pass on Wednesday, June 20," she said.

The crisis started when NDP and the Conservatives voted down a number of schedules attached to the Liberal budget during finance committee hearings last week.

Premier Dalton McGuinty said the move had "gutted" the budget and threatened to call an election.

Horwath says NDP can’t support changes to arbitration

On Monday, Horwath said her party was committed to voting against four schedules that will make changes to the labour arbitration system in the province — changes that she said her party cannot support.

The other issues of contention would be allowed to pass.

The Liberals are in a minority in the legislature and need the support of one of the other parties in order to pass legislation.

The NDP could either vote with the government in Wednesday's vote, or abstain. Either way the budget would pass.

Horwath admitted that she was offering a compromise way to resolve the impasse. The focus will now shift to the finance committee meeting on Tuesday.

Over the weekend Premier Dalton McGuinty wrote an open letter to Horwath.

The letter contained none of the inflammatory language from last week: no accusations of back-stabbing, no threats of calling an election. However, McGuinty insisted the budget bill must remain intact.

"Getting the government's budget passed is important for economic stability. The budget provides the foundation for the government's economic and fiscal plan — a plan that will keep Ontario's economy growing and ensure the government stays on track to a balanced budget," he wrote.

Premier wants deal in writing

McGuinty wanted Horwath to promise — in writing — not to cut more sections out of the budget and to put back the parts her MPPs already removed.

Horwath said Monday she had sent a letter to McGuinty outlining her new position.

Finance Minister Dwight Duncan responded a few hours later, accusing the NDP leader of confirming "in writing, that she has no intention of keeping her word."

"I will continue monitoring the developments at committee closely. If the intent of any budget schedule is reversed or a schedule itself is blocked, I will have no choice but to request the premier to review all options."

Duncan's comments could mean that Liberal threat to call an election still exist.

His comments also came before the defeat of Schedule 22 on Monday afternoon.