"We were offered a take it or leave it Canada Job Grant program," P.E.I.'s Finance Minister Wes Sheridan said in a written statement Tuesday evening.
Tuesday's federal budget laid out what the government is prepared to do if a deal on the jobs program cannot be reached with the provinces.
"In jurisdictions where agreements are not secured, the government of Canada will deliver the Canada Job Grant starting April 1, 2014, directly through Service Canada," according to the budget.
Kenney is expected to give the provinces a response to their counter-offer in the coming days, but P.E.I. has taken Tuesday's announcement as a sign that Kenney's upcoming reply will be non-negotiable.
"Provinces and territories have provided a reasonable, unanimous counter-proposal for the Canada Job Grant that invests in training, while protecting the most vulnerable," Sheridan said.
"It is our hope that the federal government accept it rather than create a new bureaucracy to deliver this program.”
The budget also said the government is still working "closely" with the provinces and territories toward the implementation of the grant and the renewal of Labour Market Agreements, which are set to expire on March 31.
P.E.I. was at the table when the provinces presented their counter-offer to the employment minister in Toronto last Tuesday.
'Threat' to Quebec
The Quebec government, which has disavowed itself of the Canada Job Grant from the moment it was proposed in last year's federal budget, took even greater offence with Tuesday's budget measure, calling it a "threat" to la belle province.
Quebec's Finance Minister Nicolas Marceau issued a terse written statement Tuesday evening deploring the federal government's new budget.
Ranking high on Marceau's list of beefs with Ottawa was the federal government's decision to deliver the Canada Job Grant directly through Service Canada.
"Not only is the Harper government standing firm on its announcement, but it has issued a thinly veiled threat to Quebec and the other provinces," Marceau said.
Delivering the job grant through Service Canada would cause Quebec to lose $70 million in funding from Ottawa, the statement said.
"This encroachment into our areas of expertise is unacceptable," Marceau said.
Quebec's finance minister reiterated Quebec's call to opt out with full compensation from the proposed Canada Job Grant — an option that was not part of Kenney's most recent revised offer.
Kudos from Alberta
Ontario's Finance Minister Charles Sousa was also upset with the new federal budget, describing it as a "kick in the teeth" of Ontario.
On the proposed Canada Job Grant, however, Sousa said the provinces were "making some headway" in their negotiations with the federal government.
Alberta's minister of jobs, skills, training and labour welcomed the federal government's investment in skills training.
In a telephone interview with CBC News Tuesday evening, Thomas Lukaszuk said "additional investments in skills development shows the federal government is recognizing the fact that jobs in Canada should be made available to Canadians first."
On the delivery of the Canada Job Grant, Lukaszuk said he was "cautiously optimistic" that Kenney would come back with a "positive response" to the provinces' counter-offer.
"Provincial programs have worked exceptionally well in Canada. I'm hoping we are going to grow on that and not set up a separate bureaucracy and a separate federal delivery of programs."
"One shouldn't be contemplating opting out until you exhaust all means of negotiations," Lukaszuk said.
Kenney has said all along the federal government remained prepared to deliver the grant alone if an agreement with the provinces could not be reached.
Tuesday's budget was the first time the federal government offered some detail on how it intends to do that.
B.C. Jobs, Tourism and Skills Training Minister Shirley Bond told CBC News that even if a deal is reached this week, it's unrealistic for the federal government to expect the provinces to have the skills training program in place on April 1.
Whether or not Kenney is prepared to delay the program's start date of April 1 with those provinces and territories he is able to secure a deal with remains to be seen.
Kenney's office told CBC News he was not available for comment Tuesday evening.