Amid all the optimism they exuded in the government's economic update, neither Prime Minister Stephen Harper nor Finance Minister Jim Flaherty are mentioning whether the country's deficit can be paid down by 2013 as they planned.

Harper warned that his stimulus plan will lead to Canada's biggest deficit ever -- at least $50 billion. TD Bank economists Don Drummond and Derek Burleton predicted last week that Canada will run a combined deficit of more than $167 billion over the next five years under Harper's current budget.

The economists said Canada will have a deficit of at least $20 billion still in the 2013-2014 fiscal year.

Harper was in Cambridge, Ont., delivering an economic update designed to stave off a summer election and said his stimulus plans will hasten Canada's economic recovery, but will come at a price.

"Our deficit will be significant but is affordable," Harper said.

But there was no mention of the long-term deficit.

On CTV News Channel's Power Play, Flaherty danced around repeated questions about the long-term deficit.

"I already do two budgets a year . . . I don't want to do four, five, six budgets," Flaherty said Thursday. "We have to look twice a year, see where we are, do our projections, which we will do."

"We'll do the usual fall economic update come the autumn, but we intend to get rid of this deficit over time."

He said he was more worried about whether stimulus money was getting out to infrastructure projects rather than having the deficit paid off in five years.

Flaherty also said he expects unemployment to worsen in the coming months.

"History, that's how recessions tend to work over time," he said.

Debate over stimulus spending

Canada's economy is chugging towards recovery and will only be derailed by "needless political instability," Harper said Thursday.

He said 80 per cent of the $22.7 billion earmarked as stimulus spending is "committed and is being implemented" in some 3,000 infrastructure projects across the country.

"That is no small feat only 72 days into the fiscal year," Harper said, while delivering the second of his government's promised quarterly reports to the House of Commons.

He said Canada was the last of the major developed countries to be dragged into the global recession, has been the least hard-hit by it, and "we will make sure Canada emerges in the strongest position when it is over."

The Liberals had threatened to topple the minority government if Thursday's report didn't show that progress was underway, and the $22.7 billion in stimulus spending approved by Parliament was being rolled out.

Liberal Leader Michael Ignatieff says he will read the report before deciding whether to bring down the government.

Ignatieff say he will make his decision as soon as Friday. He made the comments at a lunch in Montreal.

The NDP and the Bloc Quebecois have indicated that they will vote against the economic update in the House of Commons.

All three parties must vote against the update in order to bring down the Conservatives' minority government.

The Liberals, who were without Ignatieff in the House of Commons, were rather mum on the stimulus update during question period Thursday.

But both the NDP and the Bloc went on the offensive against the government's economic update.

"Why have so many projects been announced but work sites sit idle?" NDP Leader Jack Layton asked in the House of Commons. "The money is not flowing, don't ask me, ask the mayors."

Last week, the mayors of Canada's 22 biggest cities appealed to the government to get cash flowing to infrastructure projects, fearing that the summer construction season is slipping away.

"The Conservatives' stimulus plan is a complete failure, the number of jobless is on the rise," Bloc Quebecois Leader Gilles Duceppe said in French during question period. "We have no choice but to vote against . . . this bill."

Economy will recover: Tories

The presentation was moderated by Sen. Mike Duffy, a former television journalist, and included a casual, seemingly unscripted interview with the prime minister during which he traded jokes with Duffy and took questions from the audience.

Harper's key message, however, was that Canada has been largely sheltered from the recession and will recover if left in the hands of the Conservative government.

"We are making progress," Harper said. "Some signs of stability are appearing in the global economy and Canada's performance... remains the best among all the major developed countries."

Harper also took a shot at the opposition parties, accusing them of having "tax and spend" aspirations and saying Ignatieff would "unequivocally" raise taxes if his party were to win an election.

He warned the timing is wrong for an election.

"We are on the right course and the only thing that can get us of course now is needless political instability," Harper said.

Harper did admit that not all is rosy in the economy, saying the Employment Insurance system needs work, and said more improvements are planned for the fall to strengthen the system.

The update was expected to provide specifics on infrastructure spending, employment and projections for economic growth, following a period in which Canada has lost 363,000 jobs since last October.

The Conservatives agreed to provide the House of Commons with periodic updates on the government's economic progress as part of a deal they made with the Liberals in order to get the Jan. 27 budget passed.