Agreement close on parental leave program in Quebec.

MONTREAL -- The federal and Quebec governments have reached an unofficial agreement in principle on their quarrel over the parental leave program that has had both sides in court, according to a Canadian Press report.

Claude Bechard, Quebec's minister of employment and social solidarity, has presented the agreement to the provincial cabinet which will decide if it satisfies Quebec's demands. It is likely to receive approval as Quebec's demands were respected. However, final approval may not come before the federal elections on June 28. Prime Minister Paul Martin is striving to have this approval occur before the election, in order to persuade Quebecois voters that 'Quebec's interests are safe in a Liberal government's hands and counter a strong Bloc Quebecois campaign in the province.

The federal parental leave program is contentious. A Quebec court found the program beyond the powers of the federal government. In February, Ottawa took the case to the Quebec Court of Appeal.

The Court will consider whether the program, which, is paid for by Employment-Insurance funds, encroaches on provincial jurisdiction as defined by the Constitution.

The case was launched when the former Parti Quebecois government filed a suit in 2002 after Ottawa implemented the program. The Quebec Court of Appeal ruled employment insurance covers the loss of a job and was not created with parental leave coverage in mind.

Quebec claimed Ottawa owed it $630 million for its parental leave program, which it did not implement because the federal government had already started its own.