The federal government is moving ahead with plans to strip certain public servants of the right to strike.

The second budget implementation act, which was introduced by Finance Minister Jim Flaherty Tuesday, will make it illegal for any bargaining unit declared to provide an essential service to strike.

Instead, such workers will be forced into arbitration in cases of a contract dispute. The rule will apply to any union where 80 per cent or more of the positions are considered to be necessary for providing an essential service.

The proposed legislation goes onto say that "the employer has the exclusive right to determine that a service is essential and the number of positions required to provide that service."

In other words, the government decides when the rule applies. "A democratically elected government should have the right to identify what Canadians consider 'essential services,'" read an email sent to CBC News from Treasury Board President Tony Clement's office.

The Harper government also defended its intent to set public service pay and benefit levels. "The proposed amendments will bring savings, streamline practices and bring them in line with other jurisdictions," said the government's emailed comments. "Our government will sit at a bargaining table on behalf of the taxpayer where the rules are fair and balanced."

Canada's largest union representing public-sector workers says it was caught by surprise by these changes.

The Public Service Alliance of Canada says it is too early to say exactly what the impact will be — but they know they don't like it.

"This bill represents a far-reaching attack on public service workers and the unions that represent them," said PSAC President Robyn Benson.

"The government is upsetting the balance of labour relations, and is showing a callous disregard for due process, health and safety and the collective bargaining rights of every single public service employee," Benson said.

"The collective bargaining rights and the protections of workers who face discrimination, who do dangerous work, or who are treated unfairly will be undermined by the proposals in this bill."

Other changes

The union measure was just one of several provisions in the 300-plus page document, including several measures that do not appear to relate to anything in last March's budget, including such housekeeping matters as:

Changing the definition of "passport" in the Criminal Code to match the one used in other legislation.

Implementing the freeze in Employment Insurance premiums announced by Flaherty a few weeks ago.

Enacting the MacKenzie Gas Projects Impacts Act, which was announced in 2006.

There are also more substantive changes that were not announced or even foreshadowed in the March budget, including:

Making declaratory provisions to amend the Supreme Court Act, to make it clear judges with 10 years at the bar of a province are eligible to represent that province on the court, a direct attempt to resolve a legal challenge to the recent appointment of Justice Marc Nadon.

Changing the way health and safety officers enforce the Labour Code.

Changes to the Immigration and Refugee Act that give the minister more power to pick and choose from economic and professional immigrants who may or may not apply for permanent residency status.

Deficit shrinking more quickly than predicted

Flaherty said Tuesday the government is $7 billion ahead of pace toward balancing the budget in 2015.

He said spending controls the government put in place that have worked better than expected are responsible for the bulk of the improvement in Ottawa's fiscal position.

Flaherty said last year's final deficit will come in at $18.9 billion, better than the $25.9 billion predicted in his budget.

This year's anticipated $18.7 billion deficit will likely be revised lower when the minister recalculates the books in the fall economic update, expected in about a month.