TORONTO -- It's back to school next week for Ontario's elected politicians as the cash-strapped Liberals aim to foist new contracts on teachers that would cut wages and benefits.

The legislature will come back two weeks early on Aug. 27 to introduce a bill that would impose a two-year deal on tens of thousands of teacher in elementary and secondary schools, government house leader John Milloy said Monday.

If the bill is passed, the government would also have the power to ban a strike or lockout for the next two school years.

The legislation is a last resort, said Premier Dalton McGuinty, who was in Ottawa for the Association of Municipalities Ontario annual conference.

"This is not an easy time. It makes for more difficult relationships -- understandably so," said the self-described "education premier."

"So we're trying as much as we can to be fair but firm in our resolve. We will find a way to get this done."

But the minority Liberals need the help of one of the opposition parties to pass the legislation. Milloy called on the New Democrats and Progressive Conservatives to "step up" and support the proposed bill.

"I think it's unfortunate that it got to this point," he said. "We've had six months of collective bargaining that's gone on, but I think this legislation reflects the reality of moving forward and I think the opposition will recognize that and vote for it."

The government can't allow the old contracts to automatically roll over Sept. 1 when it's facing a $15-billion deficit, Milloy said. Over a year, it would cost an additional $473 million in pay hikes and bankable sick days.

"We want to remove this cloud that is potentially hanging over us, a financial cloud," he said. "And as we heard from various unions talk of strike votes, days of action, etc., we need to get going on this," he said.

The Liberals had threatened to introduce the bill if teachers didn't sign new contracts with school boards by the end of the month, saying the school year could be disrupted by labour strife.

The legislation would impose terms that would mirror the controversial agreement the government reached with English Catholic teachers, which included three unpaid days off and an end to banking sick days that could be cashed out at retirement.

The government would also have the authority to impose new collective agreements starting Jan. 1, if they can't be reached before then.

Three unions representing about 45,000 workers -- including francophone instructors -- have accepted the agreement, but two unions who collectively represent about 93,000 teachers still oppose it and have vowed to fight it in court.

The Elementary Teachers' Federation of Ontario and the Ontario Secondary School Teachers' Federation say they're not in a legal strike position and that the government is deceiving parents by spreading fear that a strike is imminent.

"The government's legislation is unprecedented and goes far beyond any wage restraint or back-to-work legislation ever enacted in Ontario," ETFO president Sam Hammond said in a release.

"This legislation is obviously designed to put politics, not students, first."

The minority Liberals are manufacturing the crisis to help them win two byelections on Sept. 6, said NDP Leader Andrea Horwath.

"This recall and this crisis the government has created is more about seats in the legislature than it is about students in the classroom," she said.

It's part of a growing pattern of opportunism by the Liberals, who cancelled a gas plant during last fall's election campaign to save seats, leaving taxpayers with a $190 million bill, she said.

Horwath wouldn't say whether her party will support or oppose the teachers' bill. But she said she's "very concerned" that, if passed, the legislation will spark a lengthy and costly legal battle.

"It seems to me they already have teachers who are saying we will take the freeze. Where is the problem?" she said.

"I think agreements can be achieved, but that would not serve the political purpose of the government."

The Progressive Conservatives, who favour an immediate legislated wage freeze for all broader public sector workers, have complained that the agreement doesn't really stop pay increases.

They say many teachers would still get raises by moving up the salary grid, which rewards experience and better qualifications.

But the Tories were silent on whether they'd support the bill, saying they need more time to look at it.

"We looked at the framework, but there's the details," said Conservative Rob Milligan.

"He's the fine-print premier. They can put forward a piece of legislation, but what actually takes place is a different story."