As federal Liberal Leader Michael Ignatieff signaled his party would support the federal budget amidst political drama unfolding on Parliament Hill, Yukon's leaders weighed in on what $85 billion in deficit spending would mean for the territory.

For Premier Dennis Fentie, the territory stands to benefit from the minority Conservative government's plan to spend its way out of the recession.

"It's going to be a large budget but stay tuned, we are just in the final stages of concluding the budget but there will be increases, as I said," Fentie said today.

At a glance, the Yukon stands poised to receive an additional $48 million in its annual transfer payment from Ottawa. As well, the federal budget earmarked $50 million to the Yukon for affordable housing.

"Just those two items give us approximately $98 million in more cash to work with in the short term," added Fentie.

While the premier hinted at large-scale projects, such as the Mayo-B hydro extension, likely to be paid for from more than $4 billion set aside for northern infrastructure, what he did confirm was $10 million to improve potable water in five Yukon communities. These are Marsh Lake, Ross River, Teslin, Haines Junction and Carcross.

"Other than Marsh Lake, these communities are predominantly first nations communities," said Fentie. "This investment will be dealing with such things as arsenic levels in the water."

While the premier is optimistic, Whitehorse Mayor Bev Buckway is wondering when the territorial government will dole out the Building Canada fund. Two weeks ago, federal Transport Minister John Baird said $175 million, contingent on a 25 per cent contribution from the Yukon, is available as soon as provinces and territories can take advantage.

However, both Fentie and Yukon Public Works Minister Archie Lang said no decision on where to spend would be made until June.

For Buckway, this is not soon enough.

"There's no clarity or certainty from the territorial government and we don't know right now how much is earmarked for municipalities," said Buckway. "There's been a lot of talk about accelerating programs ... and we have a concern if it takes until the end of the summer to work some of this out, the 2009 building season is lost."

Back in Ottawa, Yukon's Liberal MP Larry Bagnell explained the rationale behind conditions his party leader set before supporting for Prime Minister Stephen Harper's budget.

"This government has made a number of promises in the past and he didn't keep them, northern ice breakers, not taxing income trust, so this is a pattern," said Bagnell.

Ignatieff announced this morning that the Liberal backing depended on quarterly reviews on the impact of proposed economic stimulus.

"That's basically why we're supporting it conditionally. The Conservatives put a lot of things in there that we demanded but our worry is they don't get implemented, they don't get implemented fast enough and then they just lapse."

Bagnell added the Liberals will be watching for a plan down the road to get us out of deficit.

It took 10 years to knock $105 billion off the national debt and now that the Conservative's budget has Liberal backing, $85 billion in promised deficit spending over five years will return Canada's debt to levels not seen in years.

And this is what concerns the Yukon Federation of Labour president Alex Furlong.

"While there's massive amounts of money to be injected into the Canadian economy, I didn't really see significant changes to helping victims and further victims of this economic crisis," said Furlong.

Furlong said he is disappointed the Conservatives failed to scrap the two-week waiting period for Employment Insurance and harmonize these benefits across Canada.

But it is the massive deficit spending that concerns him most, and he doubts federal Finance Minister Jim Flaherty's assessment that the government would be in a surplus position by 2013.

"The devil's in the details, and we're in for a massive amount of money," Furlong told the Star. "And there's no way this government can predict it will be in a surplus in five years; that's wishful thinking."

BUDGET HIGHLIGHTS - from The Canadian Press and Winnipeg Sun

• the federal government is estimating the $40 billion in stimulus through spending and tax cuts in 2009 will create or save 190,000 jobs;

• by 2013, the national debt is expected to reach $294 billion, up from $233 billion in 2007;

• $20 billion in personal income tax relief;

• $85 billion deficit over five years (2013), including $34 billion this year and $30 billion in 2010;

• cut personal taxes by $20 billion over six years including increasing the basic personal amount that can be earned tax free by 7.5 per cent;

• cut business taxes by $2 billion over six years;

• $12 billion ($7 billion in new cash) for infrastructure spending... roads, sewers, universities and an Arctic Research Station, including $1 billion for clean energy research and $1 billion for "green infrastructure;"

• $7.8 billion for social housing and private home renovation tax credit of up to $1,350 per household (based on $10,000 worth of renos);

• $8.3 billion for skills and training, including $1.5 billion in new cash to retrain workers;

• extend Employment Insurance by five weeks for two years (maximum of 50 weeks);

• $2.7 billion in short term loans to the auto industry;

• $1 billion over two years for a Community Adjustment Fund (to help communities adjust to the economic hardship);

• more than $1.4 billion for aboriginal schools, health, water, housing and community services and training.