OTTAWA–Prime Minister Stephen Harper is expected to present a rosy picture of his Conservative government's handling of the recession Thursday in a slick made-for-TV presentation designed to forestall a quick summer election.

The planned event in the southwestern Ontario industrial city of Cambridge will feature the Prime Minister releasing the government's report on the effectiveness of government policies at the Armenian Community Centre.

The presentation will be moderated by Senator Mike Duffy, a former television journalist, and feature Harper, flanked by Human Resources Minister Diane Finley and Gary Goodyear, the local MP and Minister of State for Science. It will include a staged interview segment between Harper and Duffy.

Although it is the second of quarterly performance reports demanded by the opposition Liberals as a condition for supporting the Jan. 27 budget, it will be the first of any substance and will be key to whether the minority government survives the summer.

Liberal Leader Michael Ignatieff has threatened to try and pull the plug on the government if the report does not show real progress in the rolling out of $22.7 billion in stimulus earmarked for this year.

"We'll wait and see and make our judgement after we read it," said Liberal finance critic John McCallum, adding he did not expect much of substance.

But, the fact Harper is releasing the document suggests it will present a glowing portrait of government action.

The setting is also important because it is in a part of the country, southwestern Ontario's industrial, blue-collar belt. that has been battered by layoffs in the automotive, machinery and fabrication businesses.

"It's a good report, yes," Finance Minister Jim Flaherty said in a brief remark upon leaving Question Period on Wednesday.

"It shows a lot of accomplishment."

The report will contain specifics on infrastructure spending, employment, and the latest projections for economic growth.

The update is also expected to point to the analysis issued by the Organization for Economic Co-Operation and Development this week which cited Canada among four industrialized countries showing signs of having reached a bottom in their decline.

In recent comments, Flaherty said that many Canadians are taking advantage of the up to $1,350 tax credit for home renovations.

But McCallum speculated the report would be a "smokescreen" masking government inaction, citing a complaint by big cities mayors last week that they have yet to see federal infrastructure funds.

"We're really going to focus on to what extent the money that they promised got into the pockets of the people actually doing the work and thereby led to jobs," he said.

Canada has lost 363,000 jobs since October, but the deterioration in the labour market has slowed noticeably since the massive losses of the December-February period.

And with the restructuring of the auto sector proceeding amid hopes for a recovery in car sales, there are expectations that the remaining jobs in auto assembly and parts plants can be saved.

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NDP Leader Jack Layton refused to speculate about whether he is prepared to vote non-confidence in the government.

To force an election, the Liberals would need the support of both the NDP and the Bloc Quebecois, who have shown no indication of being eager to face the electorate.

Part of the reason may be that recent polls have shown the Liberals as the key beneficiaries of Tory slippage in support, particularly in the key provinces of Ontario and Quebec.

Some Liberals want to strike while the iron is hot with the minority government vulnerable on a number of fronts, including the impact of the deep recession, rising unemployment, the ballooning deficit, and the Lisa Raitt affair, in which the embattled natural resources minister got into trouble over her taped comments about the medical isotopes crisis.

Liberal MPs also don't want to continue propping up Harper and fending off NDP and Bloc Quebecois accusations that they're spineless and unprincipled.

Yet, Liberal insiders say senior advisers – including party pollster Michael Marzolini – are urging caution, fearing that voters won't pay attention during the summer and that the party's war chest is still relatively empty.

Insiders say Ignatieff may be prepared to risk a non-confidence vote on the assumption either the NDP or Bloc will vote against it.

Layton, asked repeatedly Wednesday whether he is prepared to vote non-confidence, was non-committal. "Right now, I'm focused on trying to get some results. We'll see what the government comes forward with."

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