The Tories are considering delivering the fall fiscal update earlier this year - perhaps in September - as they prepare for a possible defeat in Parliament. This update, which would coincide with the fall report on stimulus spending, will likely include funding approvals for already announced aid for pulp mills and loans to Air Canada.
If the government is planning to move up the date for the fiscal update, this is probably a tactic to try and set the stage for an election. If the fiscal situation was speculative heading into a campaign, then the government is more vulnerable to attacks, particularly on the deficit. I suspect the Conservatives want to present a clear, up to date picture, to Canadians, so they are armed with a current counter. Almost certain, this fiscal update will offer estimates that show no long term structural deficit. By establishing this argument, the government will try to insulate themselves from the entire tax debate, as well as setting up the Liberals.
The government can acknowledge the short term realities, putting themselves more in line with other independent estimates. This will address the "out of touch" argument, which explains why the government wants to move up an update which isn't optically attractive. The longer out the projections, the more wiggle room the government has, in terms of predictability. Even though the government may look optimistic, it's easier to manipulate numbers 3,4,5 years out, because there is so much uncertainty, nobody can really be definitive. Some criticism, but the Conservatives will counter that they see better days on the horizon than their critics.
Moving up this fiscal update, in tandem with the stimulus report(sure to paint the government in a positive light), looks like a concerted effort to get their economic argument together for a campaign. The Conservatives are vulnerable on the fiscal front, and I'm willing to bet this update will be as much a political presentation, as it will be a sober assessment. I'd also wager, the Conservatives use this update as the underpinning to argue that no new taxes will be required, simple restraint and future prosperity will be enough to tackle the deficits. Where that will leave the Liberals remains to be seen.