04/18/2012 10:40 EDT | Updated 06/18/2012 05:12 EDT

Liberals claim 'common ground' with NDP but suggest Tories can't be trusted

TORONTO - Ontario's minority Liberal government took another step Wednesday to garner NDP support for a crucial budget vote next week by announcing the merger of two large electricity agencies.

The cash-strapped government, fighting a $15.2-billion deficit, expects to save "up to $25 million" by merging the Ontario Power Authority and the Independent Electricity System Operator, said Energy Minister Chris Bentley.

"It is important to note that this is something that the NDP specifically has identified and asked us to consider," Bentley told reporters as he announced the merger.

"We have common ground with the NDP on this issue."

The Liberals have all but given up on finding common ground with Progressive Conservative Leader Tim Hudak, who supported the HST until the Liberals adopted it and who rejected the budget without even reading it, said Bentley.

"I’m still looking for something that we can agree to that he will stay in agreement with the day after we introduce it," said Bentley.

"It is difficult to identify the common ground with the PCs that remains common after you stand on it."

The "common ground" with the New Democrats theme was echoed during question period by Finance Minister Dwight Duncan, even as he swatted away demands from NDP Leader Andrea Horwath for a surtax on incomes over $500,000.

"I’m glad that we are able to find common ground with the third party in some areas," Duncan told the legislature.

"I look forward to continuing the dialogue as we move forward towards the vote next Tuesday."

Outside the legislature, Horwath called the merger of the IESO and OPA a "baby step," and said her party still wanted to see Hydro One and Ontario Power Generation brought back under the same roof with the soon-to-be merged electricity planning agencies.

"We wanted to see all four merged together because we think that’s the right way to go," she said.

More talks with the Liberals were scheduled for Thursday and Friday to discuss other changes the NDP want to see in the budget, such as the high-income surtax along with help for smaller hospitals, child care centres and even the horse racing industry, said Horwath.

"There’s a lot of proposals that we’ve put on the table that we haven’t heard back about, and we’re waiting to hear what the government’s planning to do," she said.

"We have some pretty substantive ideas that we want the government to act on."

The Progressive Conservatives vowed to vote against the budget the day it was released, which means the Liberals need at least two NDP votes next week or the minority government will be defeated, automatically triggering another election.

Duncan lashed out at the Tories during question period Wednesday, noting they have started nominating candidates just six months after the last election and accusing the Opposition of trying to force another campaign that he said no one wants.

"I reject their desire to have an election," said Duncan.

"The people of Ontario rejected them last fall, and if they insist on an election now, I believe the people of Ontario will overwhelmingly reject them in a general election if that’s what they try to force."

Conservative MPP Rob Leone complained the Liberals were behind automated phone calls to people in his Cambridge riding claiming he was voting against a local hospital expansion, and said it was the government that was "gunning" for another election.

"Rather than promoting their budget using facts, the Liberals rattled their election sabre and instead resorted to distractions, scare tactics and misleading robocalls," said Leone.

"Since the budget, Liberals have been accusing the Ontario PC Party of gearing up for an election, when it is actually the Liberal party who are paying for these election-style robocalls."