05/07/2012 03:45 pm ET Updated Jul 07, 2012

Canada's Economy: Pipeline Approval Necessary To Boost Employment, Government Says

* Endless debate on projects is unacceptable - minister

* Environmental measures included in omnibus budget bill

* Opposition says inclusion undermines political debate

OTTAWA, May 7 (Reuters) - Canadian government measures to speed up environmental approvals for pipelines and other major projects are crucial to help expand the economy and boost employment, Natural Resources Joe Oliver said on Monday.

"The need for this legislation is urgent," Oliver told reporters outside the House of Commons. "The world will not stand by and wait while Canada endlessly deliberates the merits of its resource potential and squanders its legacy."

The environmental measures have been folded into an omnibus budget implementation bill, drawing sharp criticism from opposition parties and environmental groups who say the move would short-circuit political debate.

"There is no transparency, no accountability," Nathan Cullen, House leader for the opposition New Democratic Party, said as he asked the Conservative government to separate out the environmental components from the budget bill.

In his remarks to reporters, Oliver said a finance subcommittee would be set up to deal separately and openly with the measures for what the government calls "responsible resource development."

Finance Minister Jim Flaherty defended the inclusion of diverse issues in the budget legislation. "A large budget begets a large budget implementation bill," he told the House.

The Conservatives say the current regulatory system is too complex and can lead to development projects being held up for a decade or more, but ecologists say anything less risks serious damage to the environment.

Citing estimates from the Canadian Energy Research Institute, Oliver said proposed pipeline expansion and projected oil output increases would generate 700,000 jobs on average over the next 25 years and add C$3.3 trillion ($3.3 trillion) in economic activity.

($1=$0.99 Canadian) (Reporting by Randall Palmer; Editing by Frank McGurty)