The Liberal government will announce a plan to help struggling lumber producers on Thursday. The package could be worth up to $1 billion.

"I expect tomorrow we'll see some substantial assistance for the forestry industry as a whole," Liberal MP Joe Comuzzi told Mike Duffy Live on Wednesday.

Comuzzi says some of the money will help smaller lumber companies with their working capital or short term cash flow.

He says the aide has to be planned very carefully to avoid retaliation from the U.S. in case the money is seen as being an unfair trade advantage.

But, the opposition says the money is just another attempt to buy votes.

"Is this another deathbed confession on behalf of the Liberals," Conservative MP Ted Menzies told Mike Duffy Live. "Now they're going to pony up to an industry that's been begging for this for years."

The annoucement comes as Prime Minister Paul Martin heads to a meeting of world leaders in Asia.

Martin says he'll push Canada's position on softwood lumber with U.S. President Bush when the two meet later this week in South Korea.

"Needless to say I will be discussing softwood lumber with President Bush," Martin told reporters following a caucus meeting.

"I will be maintaining Canada's position (that) we are right and the free trade agreement should be honoured."

The two leaders will cross paths in Busan, South Korea during a summit of Asia-Pacific leaders. Martin left Wednesday afternoon for the trip.

Martin's stance comes as two rulings, one from the WTO and one from NAFTA, send mixed signals about who is right in the long-running trade dispute.

The World Trade Organization says the U.S. Commerce Department is now following international trade rules by making enough modifications to its import duties.

But, the Prime Minster says that ruling doesn't matter.

"The WTO decision is largely irrelevant to this," Paul Martin told reporters this morning. "The fact is, that what we are talking about are NAFTA rules, NAFTA panels, which we have won consistently."

The Canadian government plans to appeal the WTO's decision.

But, a separate decision by NAFTA on Wednesday agrees with Canada's position. It's giving the United States until next week to comply with an earlier panel ruling.

The earlier decision forces the U.S. government to re-calculate the tariffs it charges on $7.6-billion of Canadian lumber imports crossing the border each year.

International Trade Minister Jim Peterson says Canada is more concerned with trying to get the U.S. to follow NAFTA rulings which are on Canada's side.

The lumber industry is one of the biggest employers in Canada.

Prime Minister Martin has repeated his pledge that Canada is "not going to negotiate a win," on this issue.

"The Americans owe Canadian companies $3.5 billion. The fact is that Canadian companies are in the right, and I'm not going to back off of that."

But, the opposition is criticizing the government for not delivering results.

"All it's been is talk," Menzies said. "We haven't seemed to have accomplished anything when you talk about BSE, or you talk about softwood."

The Conservative Party is recommending an envoy process, where a representative from each side would help to raise talks above the political rhetoric.

"We seem to have lost the art of diplomacy," NDP MP Alexa McDonough said on Mike Duffy Life.

"The reality is that we have a prime minister who has no results to show around an issue, that decision after decision, has come down on our side."

In another long-running trade dispute, the U.S. Agriculture Department has said it plans to lift all outstanding mad-cow disease related restrictions on Canadian cattle in the next year.

The opposition says the Liberal government has handled the cattle situation the way it has handled softwood.

"I think we need to see some backbone from the government before it's really going to be taken seriously,"  McDonough said.