New Employment Minister Pierre Poilievre inherits a simmering feud with the provinces over training cash as the outgoing minister had just sent a terse letter to his counterparts rejecting their latest demands.

A letter obtained by The Globe and Mail shows former employment and social development minister Jason Kenney – who was shuffled Monday to defence – recently chastised the provinces for requesting more training money, arguing that it would require higher payroll taxes.

Mr. Poilievre joins the department as it is in the middle of behind-the-scenes negotiations with the goal of "transforming" the annual $2-billion transfer to the provinces, called Labour Market Development Agreements, which use employment insurance premiums to fund provincial training programs.

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A previous change to a similar but smaller $500-million annual transfer – which ultimately formed the basis of the Canada Job Grant training program – involved more than a year of negotiations.

Mr. Kenney's letter to provincial labour ministers states that he was "most surprised" by a recent statement from the premiers through the Council of the Federation, which suggests more money would be required to improve training, a key policy priority for Ottawa.

"To be very clear on this point: the Government of Canada believes that it would be damaging to job creation to increase EI premiums in order to fund an increase in LMDA transfers. I hope that you agree," Mr. Kenney wrote.

Job training reform and EI are among several sensitive files that are among Mr. Poilievre's significantly expanded responsibilities.

Implementing changes to the Temporary Foreign Worker program will be another.

Mr. Poilievre comes to the employment file with strong views on the role of unions. In 2012, he said he would be advocating inside government for "right to work" changes that would allow federally regulated workers to opt out of paying union dues.

"People should be free to decide whether or not they want to be part of a union," he told The Globe at the time.

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Though Mr. Poilievre represents an Ottawa riding, he was born in Calgary and graduated with an arts degree from the University of Calgary.

Closer to home, Prime Minister Stephen Harper is trusting Mr. Poilievre to oversee the National Capital Commission, essentially making the 35-year-old MP the senior political minister for Ottawa and Gatineau ahead of the fall federal election.

That role previously belonged to John Baird, the veteran Tory who announced last week he is leaving federal politics, triggering Monday's shuffle.

Mr. Poilievre, who has been elected four times as MP for Nepean-Carleton, was always close to Mr. Baird and often took on similar political roles for the government in criticizing the opposition in the House of Commons.

That aggressive style was most prominent during Mr. Poilievre's time as the Prime Minister's parliamentary secretary, but he has softened his public demeanour since his July, 2013, promotion to cabinet as minster of democratic reform.

As the new minister responsible for the NCC, one of Mr. Poilivre's most pressing files will be the future of Ottawa's light-rail project. Construction is already under way for the first phase, paid for by all three levels of government, which includes digging a tunnel underneath downtown Ottawa. Ontario has said it will contribute to a second phase, but the federal government has been non-committal.

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The NCC has been sparring with the City of Ottawa over the location of the expanded transit line.

Mr. Baird, who was then the minister responsible for the NCC, agreed to a 100-day truce with Ottawa Mayor Jim Watson so that federal and municipal officials could work out an agreement behind the scenes. That truce expires on March 6.

In an interview, Mr. Watson said he expects that deadline will remain. He also said he and Mr. Poilievre – with whom he planned to speak Monday afternoon – have a good relationship from attending many of the same local events, such as cow-milking contests and plow races.

"Hopefully that bodes well for the relationship between our two organizations," he said.

Mr. Poilievre was not available for an interview, but issued a statement thanking the Prime Minister "and the Canadian people" for the opportunity to serve.

"It is an honour," he said. "The new role will allow me to advance our low-tax plan for families. Lower taxes create jobs and help families get ahead."