Canada's minority Conservative government faced the threat Monday of being toppled by a coalition of two opposition parties unhappy with economic policy.

Prime Minister Stephen Harper's government announced policy for next year's budget that included a ban on civil service strikes and removal of a near $2 per vote federal subsidy for political parties.

That infuriated the Liberals, New Democratic Party and Bloc Quebecois and triggered weekend meetings in which agreement was struck to topple Harper's government on a non-confidence vote and form a coalition government to last the next 30 months, the Globe and Mail reporter.

The NDP would have eight members in a 24-member Cabinet, although the Liberals are divided over whether leader Stephane Dion should become interim prime minister until a leadership convention next spring. Dion led the party to its worst showing in the Oct. 14 federal election, the report said.

During the weekend, the Conservatives have backed down on the two controversial measures and Finance Minister Jim Flaherty promised an early budget on Jan. 27, the Toronto Star said.