COMPANIES ACT AMENDMENT.

Mr. MILLER moved:: That Bill (No. 7) An Act to amend the Companys' Act, be placed amongst government orders on the orders of the day in the name of the Hon. the Secretary of State for consideration in Committee of the Whole in accordance with the recommendation contained in the tenth report of the Select Standing Committee on Banking and Commerce.


Sir WILFRID LAURIER.: Has the Secretary of State been communicated with upon this matter?


Henry Horton Miller: The Under Secretary of State, Mr. Mulvey, was in charge of the Bill, and it is at his request that this motion is made.


Wilfrid Laurier: Has the Secretary of State recommended it?


Henry Horton Miller: Yes.


[Stage Direction]
Motion agreed to.

Wilfrid Laurier: That the recommendation of the Honourable the Speaker of the House of Commons, laid on the table on Tuesday, the 9th instant, that the vacancy in the Library of Parliament be filled by the transfer of Mr. Oswald Sou-liere from the Department of Marine and Fisheries to that of the Library of Parliament be concurred in, and that a message be sent to the Senate acquainting their honours therewith.
He said: The report is to be found in the Votes and Proceedings of May 9, page 909.


[Stage Direction]
Motion agreed to.

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)

Mr. FAQUEX:: 1.	What amount was paid to the guardian of the Nicolet post office, what is the nature of his duties, and is he supposed to be a night watchman?
2.	What amount has the government collected from the registrar of Nicolet for the rental of an office in the post office for 1 he past three years?


Mr. PUGSLEY:: 1. (a) $43,33 per month; (b) the ordinary duties of a caretaker; (c) no.
2. A misunderstanding arose as to the rental to be paid, but the matter is now approaching settlement.


EXPORTS OF MILK AND CREAM.
Mr. EDWARDS:: 1.	What was the quantity and value of cream and milk exported from Canada to the United States during the months of March and April, 1911?
2.	What was the quantity and value ol casein exported from Canada to the Umced States during each month of 1910 and for the months of January and February, March and April, 1911?


Mr. PATERSON.: The quantity and value of cream and milk exported from Canada to the United States during the months of March and April, 1911, was as follows:

	Gallons.	Value.
Cream.. .	
17,244	$14,594Milk.. ..	
18,327	1,115APRIL.	Gallons.	Value.Cream.. .	
18,084	$14,828Milk.. ..	
418	492. The quantity and value of casein exported from Canada to the United States during the undermentioned months, was as follows:	'Pounds.	Value.April, 1910.	
16,150	$ 760
102,970	1,213June " ..	
55,462	1,509July " ..	
125,306	3,157Aug. " ..	
151,722	3,075Sept. " *	
174,766	3,224.. .. 310,851	7,793Nov. " ..	
230,532	6,507Dec. " ..	
179,792	4,896Jan., 1911..	
97,283	2,085Feb. " ..	
44,336	1,952March te ..	
26,002	838April " ..	.... 37,777	1,091Note.-Casein	not separately enumerated	classification of exports previous to	month
April, 1910.


ANNUITIES TO JUDGES IN YUKON TERRITORY.
[Stage Direction]
Sir ALLEN AYLESWORTH moved that at the next sitting the House go into Committee of the Whole to consider the following proposed resolution:
Resolved, that it is expedient to provide that His Majesty may by letters patent under the Great Seal, grant to each of two of the judges of the Territorial Court of the Yukon Territory, now holding office, an annuity equal to the salary of the office now held hy him, to begin immediately after his resignation, and to continue thenceforth during his natural life.
[Stage Direction]
He said: I have to state that, His Excellency the Governor General, having been apprised of the subject matter of this resolution, commends it to the favourable consideration of the House.
Mr. SPROULE.: How long have these judges held their offices?


Wilfrid Laurier: This is only a notice of motion.


[Stage Direction]
Motion agreed to.

[Stage Direction]
On the orders of the day being called:
Wilfrid Laurier: That the special committee to inquire into statements in regard to the Hon. Frank Oliver, Minister of the Interior, mentioned in the resolution of this House, passed on the 3rd day of May inst., do consist of Messrs. Clarke (Essex), Carvell, Geoffrion, Meighen and Crothers.


[Stage Direction]
Motion agreed to.

Mr. JAMESON.: Before the orders of the day are called, I would like to ask when we may expect a return with reference to a bait freezing establishment at Barrington Passage ordered on 28th of February last. The minister some time ago said it would be brought down shortly, hut it is not here yet, and I am anxious to get it.


Wilfrid Laurier: I shall have the matter looked into at once.


NIAGARA FALLS WATER-POWER.
Mr. BORDEN (Halifax).: Before the orders of the day are called, I would like to bring to the attention of the government a notice which I observed in the press of the United States respecting a fight- being made by the American Civic Association against a threatened depredation and despoliation of Niagara Falls. The statement issued by that association is in part as follows, according to this press report:
The situation is peculiar. The waterways treaty with Canada, signed January 11, 1909. while apparently limiting the amount of water which might he taken from the falls, has, on the contrary, increased this diversion. The power development companies have taken advantage of the outside limitations of the treaty and to-day are demanding what will come to 68 per cent more water than is now being drawn into the tunnels for the purpose of turning the giant turbine engines.
Next Wednesday, the 10th instant, the Senate Committee on Foreign Relations will have before it joint resolution No. 3, offered by Senator Burton, of Ohio. This resolution has been prepared in order to save Niagara from Sir ALLEN AYLESWORTH.
the interests which are attempting to wrest additional free power for their private use.
It is estimated that the failure of the Burton resolution will mean an increased income of approximately $5,000,000 annually for the companies back of the opposition. The method by which the amount of water necessary to yield this enormous return can be taken under cover of the law is simple. The treaty has established what is known as a maximum limit of diversion of 56,000 cubic feet per second; that is to say, 25 per cent of the average flow of 222,400 cubic feet per second, and 30 per cent of other ordinary low water flow of 180,000 cubic feet. These amounts were allowed for diversions for specific purpose of power production. But the treaty places no limit on the amount of water that may be taken for sanitary and domestic purposes, thus leaving the way open for still greater diversions. The new enterprises ready to start up work on this basis, together with the increasing diversion sought by the existing plants, fully warrant the general alarm least the national ownership of Niagara shall whether wholly or in part pass into untrustworthy and irreverent private hands.
I observe also that in the same statement issued by this association it is alleged that $40,000,000 worth of capital is now invested by those who desire to consummate the purposes alluded to in this statement. I think this matter worthy of being brought to the attention of the government for the reasons contained in the latter part of the statement, namely, that although the treaty restricts the maximum limit of diversion to 56,000 cubic feet per second, there is an attempt to take advantage of that provision in the treaty, which permits diversion for sanitary and domestic purposes. It is clearly, therefore, the duty of this government to make some inquiry as to whether any such attempt is about to be carried out; and if so it is desirable that this government should make a strong protest against it.


Mr. PUGSLEY.: I have been giving some attention to this matter and have some papers bearing on the subject which I have not with me at present. I shall be glad if mv hon. friend will send me the newspaper clipping he has read, and to-morrow I shall be able to make a statement with regard to the subject.	_


ENGLISH MAIL SERVICE TO THE MARITIME PROVINCES.
Mr. EMMERSON.: I would like to bring to the attention of the Postmaster General a subject that is of deep importance to the people of New Brunswick and the other eastern provinces. I refer to the deliveries o+ the English mails in the east. Last week a business man in Moncton wrote me, that:
The 'Virginian' arrived at Rimouski at 6.25 Saturday morning, four passengers and mails for the east. She left Rimouski at 15.12 in the afternoon on a local train for Camp-

bellton; detention nine hours at Rimouski. Arrived at Campbellton at 20.35; transferred from local to freight train and left Campbellton on freight train at 22.15 Saturday night; difference in time makes detention there one hour and twenty minutes.
Arrived at Moncton at G.40 Sunday morning; carried Moncton mails along with them to St. John-(we received Moncton mails at 11 o'clock Monday morning). Transferred at Moncton to another freight train on Sunday morning for Halifax. I do not know whether they have arrived there or not.
Considerable delay always occurs, but this seems to have been quite unusual. The further statement of my correspondent is to the effect, that he had letters and papers mailed to him in London on the 28th April via the Canadian route, and that they only arrived in Moncton on Monday, or about 13 days later.


Mr. TAYLOR (Leeds).: They ought to engage an ox team.


Henry Robert Emmerson: My correspondent goes on to say that papers and letters mailed April 28th to him from London via New York reached him Saturday afternoon, whereas those mailed him on the 26th April by the Canadian route only arrived on Monday, 8th May and took 13 days to get to Moncton, as compared with seven and a half days via New York. He adds that he has given orders to have his mail matter sent in future by the New York route. There must certainly be something, wrong on the part of the Postmaster General's Department or some other department with respect to the disributipn of the English mails in the maritime provinces. The mails from Moncton and the east which arrived at Rimouski on Saturday morning last were received at Moncton and Halifax and Campbellton many hours after the mails, which had arrived at Rimouski for Manitoba and the west had reached Winnipeg. This is a matter which demands the attention of the Postmaster General. This complaint is not a new one, but one of long standing, and it seems to me that the time has come when a remedy should be applied.


Mr. CROSBY.: Strong protests have been sent from the Halifax Board of Trade to the Postmaster General, and probably to the Minister of Railways, complaining of the present mail service to Nova Scotia and the east. When the steamship arrives at Rimouski there is great anxiety to transfer the mails for the west in the quickest time, and properly so, but in the rush, the east appears to be overlooked, and on many occasions our letters have been delayed for three or four days. The Board of Trade have addressed me on the subject, but having a high opinion of the executive ability of the Postmaster General, I thought the evil would be remedied without my urging him very strongly. In that I am sorry to say I am mistaken. I hope the Postmaster General will have the matter attended to at once, and that we will get our mails in Halifax via the Canadian route at least as speedily as via New York.


Hon. RODOLPHE LEMIEUX (Postmaster General).: I have with me a return which was asked for earlier in the session by the leader of the opposition, and which deals with the whole question of the mail service for the east. When the mail steamer arrives at Rimouski, she is met by a special tender manned by our own crew and the bags and the baskets are at once transferred to the wharf at Rimouski. I may say that this mail matter has increased six or seven hundred per cent in the last few years. There is a large quantity of mail for the east, but of course there is a far greater quantity for the west. Sometimes the steamer is delayed and, the train for Rimouski leaves for the east on time, and the mails have to be placed on the next train which causes delay. At the demand of the steamship companies, we have decided that in future the mails for the west will be landed at Quebec, taken by the Canadian Pacific railway to Montreal, and there distributed for western points. The mails for the east will be delivered at Rimouski and put on the first available train. The delay is due to the Intercolonial railway at times, and to the steamer at other times, but so far as the post office is concerned, it does all it can to expedite the mails. The return which I have here gives, all information.


Robert Laird Borden: There is diligence up to a certain point, but in the end the question comes down to, what is the next available train? It may not come along for half a day.


Henry Robert Emmerson: Nine hours in this instance.


Robert Laird Borden: It seems unfortunate that one million people in the maritime provinces must have important mail communications delayed in this way. I did not know that this matter was to be brought up, and I have not before me the very strong representations which have been made to me, and which I have passed on to the Postmaster General. I would be glad if the Postmaster General would make a motion so that the document he has brought down may be put on the records of the House as I purpose bringing this matter up again for discussion.


Rodolphe Lemieux: I will make the motion, but perhaps I could include it in ' Hansard '.


Robert Laird Borden: That will answer my purpose better. Perhaps it may be included in ' Hansard ' without objection.


Wilfrid Laurier: Let it go as part of the answer of the minister.


Rodolphe Lemieux: The memorandum is as follows:
Ottawa, Feb. 2, 1911.
With further reference to the question of employing a special train via the Intercolonial railway from Rimouski to Halifax for the conveyance of incoming British mails during the season of navigation on the St. Lawrence route, the Postmaster General is informed that during last season, that is from 29th April to 11th November, inclusive, twenty-nine steamers landed mails for the maritime provinces at Rimouski via Allan and Canadian Pacific railway line steamers.
A form showing the number of letter bags, newspaper bags and parcel post receptacles with their respective approximate weight, and approximate total weight, time of arrival at Rimouski and Halifax, also the detention at Rimouski, is attached. (The Controller regrets that he has no typewriter large enough for this work). Also attached is a return showing the gain in time that might have been made for each mail if a special train had been employed.
The cost of a special train would be as follows: 494.06 miles at $1.60 per mile, $741.09 per trip; for 29 trips a total cost of $21,491.61 for the whole season.
It is possible that the railway might claim double mileage between St. Flavie and Rimouski on the plea that it was necessary to make up the special train at a divisional point, in which case the cost would be $27.02 more per trip, or a total of $22,277.19 per season.
The average total weight of mail per trip last season was 10,678,-27 pounds.
With reference to the return showing the gain in hours effected by using a special train, it might be observed that mails would not be assorted on the special train and consequently matter for the northern portion of the maritime provinces would not reach destination in some cases as quickly as under the present system. The column showing gain in hours merely indicates the acceleration of mails for Halifax city on the basis of >16 hours running time for the special train from Rimouski to Halifax, Regular train, 200, covers the distance in 16 hours 39 minutes.
Where the gain shown is over 24 hours it will be observed that there has been unusual detention at Rimouski due to the steamer arriving shortly after the maritime train had passed Rimouski, and also the difference in the running time of a special and a regular train.


B. M. ARMSTRONG.
[Stage Direction]
Controller.
*If special trains had been employed no mails would be assorted in route, and allowing 16 hours for running time between Rimouski and Halifax, the mails would have arrived at Halifax as follows:
April 29,	10.35 p.m.	instead of 7.00 p.m	April	30,	Gain	20	hours,	25	minutes.May	6,	9.30 „	ii	5.40	ii 	May	7,	ii	20	[DOT][DOT]	10	iiII	12,	7.00 „	ii	5.40	[DOT]1 .... M	13,	ii	22	ii	40	ii„	20,	3.30 „	ii	6.30	II .... It	20,	ii	3	ii	II	27,	4.50 "	ii	5.45	„ 	
„	28,	ii	23	ii	55	iiJune	4,	6.07 a.m.	it	6.05	ii 	J une	4,	ii	12	ii	2	itm	9,	4.48 p.m.	ti	6.05	ii .... ii	10,	ii	25	ii	17	iiii	17,	11.12 a.m.	n	5.55	ii .... ii	17,	ii	6	it	43	H	24,	6.10 „	it	2.00	ii .... it	24,	ii	7	ii	50	iiJuly	1,	12.00 noon	ii	4.25	it 	J uly	1,	ii	4	it	25	>i,,	8,	5.00 a.m.	ii	3.26	ii .... ii	8,	ii	10	ii	26	iiII	In,	8.50 „	ii	3.24	II .... M	15,	it	6	it	34	iiII	22,	1.45	ii	3.25	II .... II	22,	ii	13	ii	40	iiIt	29,	1.20 p.m.	ii	3.00	II .... II	29,	it	l	ii	40	iiAug.	5,	12.20 a.m.	it	2.15	m 	Aug.	5,	ii	13	ii	55	iiII	12,	8.30 „	3.45	II .... II	12,	ii	7	ii	45	iiII	18,	9.25 p.m.	ii	12.00	II .... II	18,	ii	2	ii	35	iiII	20,	3.30 „	ii	3.50	II .... II	26,	ii	0	ii	20	iiSept.	1,	11.08 „	ii	3.15	[DOT]i 	Sept.	2,	it	16	ii	7	iiii	9,	9.25 „	it	10.44	n .... ii	9,	ii	1	ii	15	iiii	15,	11.00 „	2.25	a.m	
ii	16,	ii	3	ii	25	iin	23,	5.45 ,	ii	11.00 p.m	23,	it	5	ii	15	u	29,	12.00 „	ii	3.35	it .... it	30,	ii	15	H	35	iiOct.	8,	8.20 a.m.	2.00	H 	Oct.	8.	ii	5	ii	40	ii[DOT],	14,	4.25 „	ii	2.45	ii .... 11	14,	ii	10	H	20	iiI.	20,	No gain.	i,	29,	3.40 a.m.	ti	6.00	
it	29,	ti	14	ii	20	iiNov.	3,	5.40 p.m.	7.20	ii ....Nov,	4,	ii	25	ii	40	ii[DOT][DOT]	U,	7.40 a.m.	[DOT]i	7.15	[DOT]	
ii	H,	it	11	25	
January 27, 1911.
The Controller begs to inclose herewith a return showing the number of letter bags, newspaper bags and parcel post baskets received at Rimouski for the maritime provinces during the summer, and approximate weights, hour of arrival of this mail at Mr. LEMIEUX.	.
Rimouski station from the dock, hour of departure from Rimouski, time of detention at Rimouski and hour of arrival at Halifax, also a return in regard to the winter service showing the number of letter bags, newspaper bags and parcel post baskets arriving at Halifax for the maritime provinces, with

approximate weights, also the hour of arrival of the Halifax mail at that post office.
Mail for Halifax city during winter season is sent to that office as soon as received from the steamer, and mail for Nova Scotia is despatched by first outgoing train if connection is made. If connection is not made, this matter is sorted at North street station and despatched by first available trains. Mail for St. John city and New Brunswick is also despatched by first available trains, and the latter sorted on these trains. It might be noted that during the summer season the average detention at Bimouski of mails for the maritime provinces, owing to special trains
not being used, is about 7 hours and 51 minutes, and the Controller would also add that from the 19th of June to the 33rd of October, two trains per day are operated from Montreal to Halifax, and from the opening of navigation to the 19th of June, and from the 23rd of October to the close of navigation, only one train is operated between Montreal and Halifax.
Under the summer time-table on the Intercolonial railway, trains for Halifax pass Bimouski at 5.31 a.m. and 8.06 p.m., and when one through train only is operated, such train is due to pass Bimouski going east at 11.45 p.m.

[Stage Direction]
K
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M
Steamer.	Date of Arrival.	Number of Letter Bags.	Approximate Weight.	Number of News Bags.	+3 o bp .§£ X! O M <	Number of P. P. Baskets.	Approximate Weight.	Total Number of Articles.	Approximate Total Weight.	Hour of Arrival at Rimouski Station.	Hour of Departure from Rimouski Station.	Hours Detention at Rimouski.	Hour of Arrival at Halifax.	Note.Lbs.	Lbs.	Lbs.	H.	M.	Empress of Britain	April 29 ...	20	1,170	95	7,125	28	2,660	149	10,955	6.35 a.m.	11.45 p.m.	17	10	7.00 p.m., 30th	Virginian	May	23	1,035	121	9,075	28	2,660	172	12,770	5.30 a.m.	11.45 p.m.	18	15	5.40 p.m., 7th	Empress of Ireland	May	12....	17	765	80	6,000	29	2,755	126	9,520	3.00 a.m.	11.45 p.m.	20	45	5.40 p.m., 13th	V ictorian	May	19....	25	1,125	117	8,775	28	2,660	170	12,560	11.30 p.ffi.	11.45 p.m.	10	Empress of Britain	May	26....	24	1,080	98	7,350	24	2,280	146	10,710	1.50 a.m.	11.45 p.m.	21	55	5.45p.m., 28th	Virginian	June	3. . ..	25	1,125	144	10,800	23	2,185	192	14,110	2.07 p.m.	11.45 p.m.	9	38	9	[DOT]20	000	8^	fi ifin	20	-|9K	Victorian	June	16....	2T	1,305	961	7'200	27	2,565	152	11,070	7.12 p.m.	11.45 p.m.	4	S3	u.uo p.m., J.UL11 5.55 p.m., 17th	Empress of Britain	June	23....	28	1,260	107	8,025	23	2,185	158	11,470	2.10 p.m.	8.06 p.m.	5	56	2.00 p.m., 24th	Virginian	June	30....	24	1,080	98	7,350	18	1,710	140	10,140	8.00 p.m.	8.06 p. m.	06	Empress of Ireland	July	7....	23	1,035	82	6,150	22	2,090	127	9,275	1.00 p.m.	8.06 p.m.	7	06	3.26 p.m., 8 th	Victorian	July	14....	27	1,215	98	7,350	19	1,805	144	10,370	4.50 p.m.	8.06 p.m.	3	16	Empress of Britain	July	21....	23	1,035	102	7,650	24	2,280	149	10,965	9.45 a.m.	8.06 p.m.	10	21	3.25 p.m., 22nd	Virginian	July	28....	23	1,035	86	6,450	22	2,090	131	9,575	9.20 p.m.	9.20 p.m.	none.	3.00 p.m., 29th	*Empress of Ireland	Aug.	4....	20	900	99	7,425	21	1,995	140	10,320	8.20 p.m.	8.06 p.m.	11	46	2.15 p.m., 5th	Victorian 	Aug.	11....	27	1,215	88	6,600	13	1,235	128	9,050	4.30 p.m.	8.06 p.m.	3	30	Empress of Britain	Aug.	18....	23	1,035	177	5,775	19	1,805	119	8,615	5.25 a.m.	5.15 a.m.	12.00 p.m., 18th	*"V irginian	Aug.	25....	27	1,215	99	7.425	19	1,805	145	10,445	11.30 p.m.	11.30 p.m.	3.50 p.m., 26th	*Empress of Ireland	Sept.	1....	20	900	24	6,300	15	1,425	119	8,625	7.48 a.m.	8.06 p.m.	12	18	3.15 p.m., 2nd	Victorian	Sept.	9....	26	1,170	86	6,450	23	2,185	135	9,805	5.25 a.m.	5.25 a.m.	10.40 p.m., 9th	*Empress of Britain	Sept.	15....	24	1,080	90	6,750	21	1,995	135	9,825	7.00 a.m.	7.00 a.m.	2.25 a.m., 16th	*Virginian	Sept.	22....	24	1,080	103	7,725	34	3,230	161	12,035	1.45 a.m.	5.21 a.m.	3	36	Empress of Ireland . 	Sept.	29....	21	945	76	5,700	22	2,090	119	8,735	8.00 a.m.	8.06 p.m.	12	06	3.35 p.m., 30th	Victorian.... 	Oct.	:7....	25	1.125	115	8.625	21	1,995	161	11,745	4.20 p.m.	8.06 p.m.	3	46	2.00 p.m., 8th	Empress of Britain	Oct.	13....	24	1,080	97	7,275	29	2,755	150	11,110	12.25 p.m.	8.06 p.m.	7	41	2.45 p.m., 14th	Virginian	Oct.	20....	27	1,215	103	7,725	26	2,470	156	11,410	11.10 p.m.	11.10 p.m.	2.65 p.m., 21st	*Empress of Ireland	Oct.	28....	19	855	91	6,825	26	2,470	136	10,150	11.20 a m.	11.45 p.m.	12	25	Victorian	Nov.	3... .	26	1,170	123	9.225	29	2,755	178	13,150	1 40 a.m.	11.45 p.m.	22	05	7.20 p.m., 4 th	Empress of Britain	Nov.	10....	27	1,215	101	7,575	30	2,850	158	11,640	3.40 p.m.	11.45 p.m.	8	05	7.15 p.m., 11th	
* Trains held for connection.
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8

Mr. HAUGHTON LENNOX (Simcoe).: Now that we have come to a definite understanding as to when the House will adjourn, I desire to ask two questions, one of which is:	Does the Minister of Finance intend to deal with the Bank Act Before we adjourn? I assume it will be impossible for the minister to do so, but I shall be glad to hear from him on that point. My second question is:	Can the
Minister of Finance assure the House now that when we resume after adjournment the Act relating to banks and banking will be disposed of during the balance of the session? The minister pointed out before that press of business prevented it, but I would anticipate that when we reassemble in July there will be an opportunity. I trust the minister will be able to assure the House that the matter will then be taken up and disposed of.


Mr. IIELDING.: I doubt if there will be the opportunity my hon. friend suggests when we reassemble in July. I would like to keep an open mind on that, but for the present I do not anticipate that we will be [DOT]able to proceed this session, either during the present part of it or when we resume, with a general revision of the Bank Act. I have given notice of another Bill respecting the Bank Act, the purpose of which is to continue the bank charters for a period [DOT]of one year. The charters will expire at an early date and it is most desirable from all points of view that whatever we may do bereaftei'" these charters should be continued for that period. This Bill will be brought forward before the recess, but as to what may happen at the later stage of the -session I do not wish to speak too definitely; my impression is that the House will bave its hands very full at that time, and [DOT]will not have time to proceed with a gen

eral revision of the Bank Act.


CANADIAN NORTHERN RAILWAY-GUARANTEE OF BONDS.
[Stage Direction]
Mr. GRAHAM moved that the House go into committee to consider certain proposed resolutions respecting aid to be granted to the Canadian Northern Railway Company for the construction of lines of Tailway therein mentioned. He said: Mr. ^Speaker, in rising to move that you do leave the chair, in order to proceed in committee with the resolutions standing :in my name, I feel that these resolutions not only are of great interest to the people of Canada, but include a bargain which when consummated, will be of the utmost advantage to the entire Dominion. Those who have not visited Canada from one end to the other will perhaps not be so thoroughly seized with enthusiasm 278
as those who have, as to the present prospects and future greatness- of the country in which we live. I feel confident that the fathers of confederation scarcely dreamed of the fabric that was to be erected on the foundations which they laid. Not only are Canadians enthusiastic over our country, but those who come to us from all parts of the world are deeply enthusiastic, and I think the most loud in their proclamations of the natural wealth and advantages of Canada are those who have come to us from across the border, from the south.
When I became Minister of Railways and Canals, I set about trying to inform myself as to what were the necessities of Canada from a transportation standpoint.
I was thoroughly convinced, and I have been more than confirmed in that view, that one of the most interesting problems we had to solve and one which was of the deepest import to our people was that of how to get their goods to and from market quickly and at a fair rate. The people who have quick and cheap transportation in any country, if the country be any good, are the people who are prosperous, and every farthing we can cut from the price of the carrying of a product to market adds something to the value of the labour that brings forth that product.
In travelling through the west during the past season, I endeavoured to secure and assimilate all the information I could get in reference to this great problem. I found that we had several United States lines running into the west and giving certain accommodation. I found that the pioneer road, the Canadian Pacific railway, had stretched its branches in many directions, and was giving a good service over two main lines, the main line proper and that by way of Crowsnest Pass, and that the „ people it reached, while sometimes complaining of what they thought were exorbitant freight rates were nevertheless pretty well served. I found too that the Grand Trunk Pacific had a magnificent line from Winnipeg to Edmonton. I think it is not exaggerating to say that it is the best line of new construction ever built on the continent of America. I might go further, but I think that is sufficiently strong. That line at present is not only stretching on to Prince Albert, but is also reaching out with its branches. This year the Grand Trunk Pacific is building as its programme in the west something like 700 miles, the Canadian Pacific railway about the same, and the Canadian Northern railway approximately the same. That is a large mileage for construction in one year, considering the population, but not a great mileage, considering the vast expanse of territory. In addition to these two I found in the Canadian west to the north that the Canadian Northern railway had a system including no less than
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4,000 miles of railway. That in itself is a great system, serving largely the territory to the north; it runs through what to my mind will eventually become a centre of mixed farming and dairying for the Dominion of Canada. The Canadian Pacific railway stretches through to Vancouver. From Prince Rupert the Grand Trunk Pacific stretches out eastward, to meet the main line at Wolfe's Creek, and by an arrangement with the British Columbia government, the Canadian Northern railway is now constructing a line which will reach from the Yellowhead Pass through the province of British Columbia down to the city of Vancouver. When this is completed, the west will be pretty well served as to main lines. That great country west of the Great Lakes will be connected by two main lines, the Grand Trunk Pacific and the Canadian Pacific railway, with the Canadian ports in the east. Travelling through the western country and over the systems of railway there, one could not but be struck with the fact that while the Canadian Northern railway is serving a large territory, _ and a large number of people in gathering the products of the west, it had no way of sending these products to the east.
And I was imnressed-and I believe the people of Canada will be impressed op making the same examination-with the necessity of having that system of 4,000 miles west of the great lakes connected as soon as possible with Canadian ports on the east. The Canadian Northern, in addition to its lines west of Winnipeg-the main line runing to Edmonton, and miles west -has a line stretching from Winnipeg to Port Arthur. From Port Arthur to Sudbury, or a few miles north and west of Sudbury, it has no connection. The present resolution which I am asking hon. gentlemen to conside" will, among other things, provide for the furnishing of that link. At the present time, the Canadian Northern has, under the name of the Canadian Northern Ontario, a line running from Toronto to Sudbury, and from Sudbury to Sellwood, but it has no line connection further west. The connecting of the lines from Port Arthur eastward will give the city of Toronto, and all the province of Ontario another through route to the great west. Coming east from Sellwood ,it is proposed that the line shall run eastward touching North Bay. Before it reaches North Bay and in that vicinity it will traverse the southern portion of what is known as the clay belt of Ontario. Now, Mr. Speaker, with all due deference to hon. gentlemen coming from other parts of Canada, let me say that there is as much good land in Ontario that has never been cultivated as there is in that province now under cultivation, and in all the discussion of opening new territory we from this Mr GRAHAM
province have a deep interest in seeing that this uncultivated part of our province is brought under the plough. There is in that territory, according to surveys, from 16,000,000 to 20,000,000 acres of good clay soil. The Grand Trunk Pacific runs through the northern portion of it. The Canadian -Northern will run more towards the southern border of this belt. The Canadian Pacific Tailway practically does not touch it at all. Coming eastward from Port Arthur, except, for a few miles, the Canadian Northern will serve an absolutely new country from that now served by either the Canadian Pacific railway or the Grand Trunk Pacific. Except in one or two instances, if I remember the figures correctly, this new line will not come nearer than twenty miles to any of the existing roads, and in many places it will be fr)om 50 to 60 miles from the Grand Trunk Pacific and from 20 to 40 miles from the Canadian Pacific railway. Coming eastward and passing North Bay, the road will proceed down through the province of Ontario, onening up a new country until it strikes the county of Renfrew. And in [DOT] mg native county of Renfrew, it will give railway communication to places which have never had it all these years. There are parts of the county through which I was carried on horseback, and later rode on horseback, through which I hope, before long, to ride on a first class train.
Mr. HAGGART (Lanark).: Does it go to Pembroke?


Mr. GRAHAM.: Yes. Coming eastward from Pembroke it crosses to the Quebec side at Portage du Fort, an,4 then at Chats Falls crosses again into the province of Ontario, and comes on down to Rideau Junction, five miles outside of the city of Ottawa, where it joins the Niagara and Montreal line. Proceeding eastward from Ottawa it will go to Hawkesbury, the distance from the junction to Hawkesbury, if I remember well, being something like 56 miles. It will then cross the interprovincial bridge, about 1.1 miles in length into the province of Quebec. This bridge is not now of proper standard for the line and will have to be brought up to standard. Then, from a point on the Quebec side apposite Hawkesbury, it will proceed to the city of Montreal. The total mileage of this line will be approximately 1,000 miles, perhaps a little more, but I think not any less.


Robert Laird Borden: Is the route stated in so indefinite a manner in the resolution?


George Perry Graham: It will be stated more definitely, probably, in the Bill. The route has not been altogether approved bv the Railway Department, but most of it has

been. The company will create terminals in the city of Montreal.
Now, as to the provisions of the resolution: In the first place, it is a 3J per cent, fifty-years bond that is guaranteed 'by the government. The road is to have 80 pound rails, and be a good standard road* with modern bridges. The bonds are to be guaranteed by the government, but the Canadian Northern Company adds its guarantee, and stands between the ^government and any possible loss.


John Graham Haggart: Does the government guarantee principal as well as interest?


George Perry Graham: It guarantees principal as well as interest, and the Canadian Northern guarantees the government against any loss. It is really the Canadian Northern Ontario and a portion of the Canadian Northern Quebec. That portion built under the Canadian Northern Quebec charter is the 1 1 miles between Hawkesbury and Carillon.


Mr. ARMSTRONG.: Does the Canadian Northern guarantee include all its road with rolling stock?


George Perry Graham: No, the Tolling stock, is built under an equipment bond. After that, we will get the security, second to an equipment bond.


Mr. CROCKET.: Is it equal to the standard of the National Transcontinental?


George Perry Graham: No, the standard is an 80 pound rail with the bridges up to the standard required by the Railway Department, and with a grade of -95 going east and -06 going west.


Haughton Lennox: Subject to a qualification as to that?


George Perry Graham: Such a qualification as you must have in the case of any line. If it becomes a physical or practical impossibility to get that grade, you have to put in a pusher grade, but only with the consent of the department before that can be done.


Oswald Smith Crocket: Then, the standard is not that for the St. John Valley Railway Company in New Brunswick?


George Perry Graham: It might be. In New Brunswick, there is a pusher grade-at least one, I think, of one per cent and over -on the Grand Trunk Pacific.
Now, Mr. Speaker, let us consider what would be the benefits of this measure to the country. It is said: We are spending a lot of money on deepening waterways and harbours, we have large projects before us in canals; why then, should more obligations be taken on in reference to railways? I thiuk it will be conceded' by any person 278*
who has given the matter any attention that when you find traffic increasing by water you will find it also increasing by rail, and vice versa. There seems to be a law that where you have facilities for traffic and transportation by rail and by water, those facilities draw trade from other-routes, where the double advantage does not exist; the water traffic in no way interferes with the rail transportation. Now, beginning at the west, the company gives a first mortgage on all this line, with two or three exceptions.


Robert Laird Borden: Before the minister comes to that, I would like him to say what he would care to say upon the question of the necessity of this line, and also give us his views as to the necessity of a guarantee. What 1 mean is, that I think these two subjects ought to be considered by parliament in dealing with this matter. In the first place, what public necessity of this' country will be benefited by the construction of this road; and in the second place, what necessity is there for a subsidy, assuming that the road is not only desirable but necessary?


George Perry Graham: In regard to the first point, I think the conditions in Canada, with our rapid growth, and the fact that this company now has 4,000 miles of railway in the west, is increasing it rapidly, and is gathering up traffic, makes it absolutely necessary that there should be another line for the carriage of the products from the west to the east, as well as feeding that line from the east to the west. I believe there is a day of prosperity near at hand that will extend clear through to the maritime provinces, a prosperity which I do not think will be secondary even to that of the west, although we have not so much unoccupied territory. My own conviction is that we cannot get these lines constructed too rapidly to meet the absolute necessity that will then exist for the carrying trade of our own products, to say nothing of the carrying trade we might do for any other country. As to the necessity of a guarantee, this company might in years work this line through. They have done a great deal, but they have been aided by subsidies and aided by guarantees. But in order that we may have this line constructed, and constructed without undue delay, in a way that we shall have something to say about its construction, and in order that the company may be able to finance such an undertaking in the best possible method so that the freight rates may be based on the least possible cost of construction, I believe it is in the interest of the people who have t-o ship goods that the government should enable the company to borrow their money at the best possible rates in the Old Country. I do not believe,

Mr. Speaker, and I do not think any other member believes, that this guarantee will ever cost the Dominion of Canada a dollar; and if we can ensure the rapid construction of this road at the cheapest possible rate, merely by lending the name of the Dominion of Canada to the company to secure its money, I believe it is in the interest of transportation, and in the interest of cheap rates as well to lend it.


Joseph Elijah Armstrong: What is the estimated cost?


George Perry Graham: A standard road, $50,000 to $55,000 a mile.


John Graham Haggart: Does that include rolling stock?


George Perry Graham: It does not include -rolling stock.


Mr. SCHAFPNER.: Is there any clause in the contract which gives the government control of rates over this line?


George Perry Graham: The control of rates will be absolutely in the hands of the Board of Railway Commissioner.), as it is on all other railways in Canada at the present time.


Frederick Laurence Schaffner: Not the Canadian Pacific railway.


George Perry Graham: The Canadian Pacific railway is under their control by consent, though I think the company does not admit liability as a matter of law. I have expressed my opinion in the House before, and though I am not a lawyer, I believe they are legally under the Board of Railway Commissioners.


Frederick Laurence Schaffner: When the Manitoba government guaranteed the bonds of the Canadian Northern railway in that country there was a clause in the guarantee enabling the government to control the rates. It seems to me it is very desirable that there should be a clause in this contract, notwithstanding the Railway Commission, giving the government control of the rates.


George Perry Graham: That might be a necessity in a province where they have nobody specially appointed for controlling the rates. But we have a board which, by statute, is given power to investigate the rates of all these companies.


Frederick Laurence Schaffner: It would apply to that company just the same.


George Perry Graham: The control of the Board of Railway Commissioners does not apply to a provincial road. A company which gets its charter from the government of Manitoba would be under the control of Manitoba, if of anybody.


Frederick Laurence Schaffner: The control of the traffic.


George Perry Graham: 


George Perry Graham: That question has been in the courts. The Manitoba government put in a clause like this which has been effective in regulating the rates.


Frederick Laurence Schaffner: This is an exceedingly important matter to the west. We have two railways now running north of Lake Superior which, in all probability, will meet the necessities of traffic for some years to come. Now in view of the trouble we have in the west, the objection I would make to guaranteeing these bonds would be the fact that so far we have not been treated right in respect to freight rates. I do not care so much about passenger rates, I refer particularly to freight; and it is high time that this government, or the Railway Commission, took some steps to regulate freight rates in the western country. It does not make any difference if there are a dozen roads, unless you have competition; we want these roads to be competing lines. We have seen these roadk making an agreement by which they all charge the same freight rates, and so far we have not received much advantage from the new line. The freight rates are too high, and it is time that this government, through its commission or some other means, should take steps to regulate the freight rates in that country.


George Perry Graham: Of course the government of the Dominion has given a good deal of consideration to the question of dealing with the tariff of rates on railways. However, to be sure that there should be no discrimination as against Canadian ports, vou will find a clause in this agreement that at no time must the rates via this line exceed the rates via lines to an American port. Now, coming to that ten-mile section, what is called the Hutton Branch, in the vicinity of Sudbury and Sellwood, I may point out that there is already on that ten-mile branch, it being a portion of the line from Toronto, certain securities for which a mortgage has been given. But in order to secure the government on that ten miles, the company is depositing with the government other securities on their Canadian Northern and Quebec line to the extent of $35,000 a mile for this 10-6 miles. Now from Hawkesbury we have a second mortgage. The security on that runs out in twenty years, and then ours becomes the first mortgage. In the meantime the first mortgage bonds on another portion of the line to the extent of $35,000 a mile, are deposited with the government. On the line from Hawkesbury to Rideau Junction, about 61 -4 miles, the same thing occurs. That is a portion of the line chartered from Niagara to Montreal. Certain securities have been issued on the line, including this piece from Rideau Junction to Hawkesbury, and

the company deposits with the Minister of Finance these securities that have already been issued but not sold, to the extent of $35,000 a mile. Although the mortgage is not a first mortgage on this portion of the road, under the guarantee, these bonds that the government will hold are first mortgage bonds, and the government's security, in addition to holding these, comes second on this line. The same thing applies to the 1.1 miles of the bridge. I may say that the security held by the government is, with this exception, a first mortgage from Montreal to Port Arthur, and that it ranks as a second mortgage on the entire system from Niagara to Montreal.


John Graham Haggart: What are they allowed to issue on the line from Niagara to Montreal? We require this information to understand our security, which ranks after it.


George Perry Graham: I think the amount is $30,000 a mile, if I remember rightly. I am speaking from memory, but I can give that information in a little while.


Robert Laird Borden: Is any part of the line built?


George Perry Graham: The part from Hawkes-bury to Ottawa, 56 miles, is constructed. The bridge is constructed across from Hawkesbury, but it will not answer the purpose without improvement or reconstruction. In addition to this, it is provided that the government may, after two years of operation, pay the interest on these bonds, and if they do this interest is added to the principal and becomes part of the guarantee for which the government has security and must be repaid by the company to the government.


John Graham Haggart: Is it ' may ' or ' must '?


George Perry Graham: No, it is ' may.'


John Graham Haggart: We ' may ' only pay?


George Perry Graham: Yes. My own opinion is that we will pay it if you ask me for my interpretation of it. It generally turns out that way.


Frederick Laurence Schaffner: We will pay for some time to come.


George Perry Graham: Not for long, but for two years. Suppose that what my hon. friend says' actually came to pass, what would be the result? In the first place, it has been said that holding the securities of the line from Niagara to Montreal in part, in order to secure ourselves, we would have to step in and buy the line or satisfy the holders of the first mortgage on that line. Supposing that were the case, we would then have what many people in Ontario think we ought to have-a line1 directly connecting with the Intercolonial railway, running
through the province of Ontario to the city of Toronto, and we would have it cheaper-than any line was ever built for. Suppose that there was a default in the interest on the main line from Montreal to Port Arthur, what would occur? The government would have the road then, too. We would have Halifax, St. John and Sydney hooked up with the Intercolonial railway, and this line clear through to Port Arthur, we would have a through line belonging to the Dominion of Canada, and that is what a lot of people in this country would like. Looking at it in every way, I come back to the point again that Canada cannot lose a farthing, because under this proposition the worst that might happen would be that the company would default, and if they defaulted it would in the opinion of some people be the best thing that could happen to the Dominion of Canada.
Then, we get to the city of Montreal, where the company engage to provide terminals. The city of Montreal is the great commercial metropolis of Canada. It must remain the gateway to a very great extent of the commerce both inward and outward for our country. It is a striking fact, Mr. Speaker, and one for congratulation as well, that the increase in the value of property in the city of Montreal has been as rapid during the last ten years as the increase in almost any city in the whole of Canada, including the western cities. It is due largely to the fact that Montreal is the commercial metropolis, and that the prosperity of Canada as a whole is reflected in the growth of that city. The Canadian Northern engages to provide terminal facilities in Montreal.
Then we come to this other proposition, and it is of some import, I think, Mr. Speaker. At the present moment the Intercolonial railway runs from Sydney, Halifax and St. John, and through intermediate points to the city of Montreal. For forty miles east of Montreal, to what is known as Ste. Rosalie, it runs over the Grand Trunk Tailway. We have a running arrangement with them and also an arrangement for the interchange of traffic. We pay the Grand Trunk Railway Company $140,000 a year in connection with this arrangement.. Last year the Intercolonial railway made, as its share of the traffic received from and, given to the Grand Trunk railway, $1,600,-. 000. The arrangement is a good thing for the Intercolonial railway, for, without being fed with some traffic gathered up somewhere the receipts of the state-owned railway would be materially lessened. In a few years the Grand Trunk railway will undoubtedly be urging that that arrangement be abrogated. They will have the Grand Trunk Pacific, with a branch into Montreal, built by somebody, and they will have the Grand Trunk Pacific crossing at Quebec to Levis and running eastward. They will

urge strongly with some degree of reason that they ought to be allowed, as the Grand Trunk Kailway Company have a deep interest in the Grand Trunk Pacific, to make connections for traffic with the Grand Trunk Pacific. That traffic arrangement is so drawn that this government, or whatever government is in power, can cancel it, but the company cannot.
An hon. MEMBEK. Hear, hear.


George Perry Graham: Well, I wanted to assure my hon. friends first that there would be something left for them to do when they got in. We are not called upon now to consider the abrogation of this arrangement with the Grand Trunk, but we can see that in the future it will be urged very strongly. But even if it is not, the Canadian Northern must have an Atlantic seaboard outlet. It has none unless it builds one. We have one to offer. If it be necessary in years to come to abrogate that arrangement, then we have a clause in this contract by which we will be free to ask the Canadian Northern, and it will be compelled to give us, an arrangement for an interchange of traffic at the city of Montreal. No person in the east and no person in the west will question for a moment the advisability of having the state-owned railway in close connection with some railway that has a line through from ocean to ocean. It will help traffic east and west, and it will help Canadian ports as well. I come back to my other proposition, to reiterate, and I say it with all sincerity, that I believe the time is at hand when the eastern part of Canada is going to enter upon an era of prosperity such as it has not known for years. I hope before the House rises to lay before hon. members another small project for gathering under the wing of the state-owned Tailway certain lines that will bring traffic to that road and will assist under this arrangement in feeding the line, that will give traffic to and take traffic from us in the years to come.
I did not intend to speak at such length. I commend this proposition to the House in every way; I believe it is in the interest of the peopie of Canada; I believe it is in the interest of the people of the west, but not more so than in the interest of the people of the east. I might just say in this connection that the company is also to build a line, although it is not in this contract, from the Georgian Bay to connect with their main line so that during the summer season they will have a through lake and rail route, as the other roads have. This is a big project, but Canada is accustomed to large things. I believe it is an undertaking in the interests of the people. It will not cost Canada to my mind anything except the fact of her liability in guaxanteeing these bonds, which the financial world will, I think, understand as the Canadian Mr. GRAHAM.
Northern people have not yet defaulted on bonds, and I think they will not in the future. I have every confidence that this line will be a good and paying line, and that when it is completed we in Canada will find that the government did a wise thing, and did not do it any too quickly in order to provide for the growing interests of the carrying trade of this great Dominion.


Mr. CARVELL.: When will it be completed?


George Perry Graham: Not for over four years.


Oswald Smith Crocket: Was there any proposal in connection with this scheme for .the extension of the Canadian Northern east of Montreal by the construction of a new line to St. John or to Halifax?


George Perry Graham: Not in connection with this scheme.	.


Joseph Elijah Armstrong: What is the.estimated amount of the security that will be held by the government over the amount of their guarantee?


George Perry Graham: We have a first mortgage on the line from Montreal to Port Arthur with such exceptions as I have mentioned. We hold first mortgage bonds to cover this. We hold a second mortgage on the. balance of the company's line in the province of Ontario from Niagara to Montreal, and we hold behind that the guarantee of the Canadian Northern Railway Company.


Joseph Elijah Armstrong: The minister surely made an estimate of the value of these securities.


George Perry Graham: It is very hard to estimate the value of the security of the Canadian Northern backing to a note. Mv own opinion is that it is absolutely unassailable. Then we have the security of the line from Niagara to Montreal, a second mortgage on that which will be at least worth say $10,000 or $15,000 to $20,000 a mile. Then we will have a first mortgage on the line from Montreal to Port Arthur, as I have mentioned, which, to my mind, will represent from $50,000 to $55,000 a mile.


Joseph Elijah Armstrong: Is it not a fact that there is not a foot of the road built from Niagara to Toronto; is it not all in the air?


George Perry Graham: There is a line under construction now from Niagara to Montreal, and there is quite a portion between Toronto and Montreal now constructed, and it is being rushed as rapidly as possible. The ri"ht of way between Niagara and Toronto has been purchased.


John Graham Haggart: In the construction of the road from Niagara to Montreal, is it the intention to utilize some old roads that have been purchased bv the company? Are these given as security also?


George Perry Graham: 
John Graham Haggart: The Rathbun road from Sydenham to Deseronto. Is that given as security?


George Perry Graham: Bonds have been issued on that line and we would only hold a second mortgage on it anyway. I would like time to look into that particular thing my hon. friend speaks of, as I do not quite agree with him on it.


Robert Laird Borden: Before the House goes into committee, I would like to express my regret that a measure which the minister regards as so important to the welfare and progress of the country and to the interests of transportation in Canada should have been delayed until we have been six months in session. Every one agrees that transportation is, perhaps, the very most important problem that is before the Canadian people to-day, and that very fact would seem to be a reason why this proposal should have been brought down earlier in the session, when parliament would have been able to give it very much closer consideration and attention than seems to be possible on the eve of an adjournment.
I asked the minister in the first place as to the necessity or the advisability of the road, which would appear to be a condition precedent, and the minister has not seen fit to answer me except in the most general terms. I will give him an idea of what I had in mind. We have between the east and west of Canada a certain stretch of country that has no appreciable population at present, and that is not likely to have, for a good many years. We have one line of railway, the Canadian Pacific railway, already in operation across that territory for some twenty-five years past. We have in process of construction across that uninhabited territory the Grand Trunk Pacific running farther north, and I hope it will be found that it runs through a country which may be able to sustain population. I entirely agTee in the suggestion that was made lay an hon. gentleman on this side during the remarks of the minister, that building two lines of railway where one is sufficient to carry the traffic is an economic waste, and never does reduce cost of carriage. I think that is an unanswerable statement. It is well known that where you have two lines of railway where one is enough to do the work, there is an economic waste, and you are not doing any good to the man who produces the commodities which are shipped over these railways. As I understand the present situation, that portion of the Canadian Pacific railway lines which extends between the populated east and the populated west of Canada is capable of carrying five times the present traffic which passes over it. In other words, before it would be necessary to double-track that road, its traffic could be
increased five-fold. It does not seem to me to be possible that under these circumstances, the construction of a third road is likely to lead to any diminution in the height charges, because the Railway Commission, or a committee of the government for that matter, in considering freight charges, must have regard to the fixed charges upon the road, and must always make the freight charges sufficient to meet the operating expenses and the interest upon the bonds, as otherwise the road would be placed in bankruptcy, or would have to be taken over by the bond creditors. I had expected that the minister would have given us some reasons why, over that stretch of four or five hundred miles of territory, a third road is considered necessary at the present time. I know it is not worth while to review what might have been done in the past, but I believe it would have been good business for the Dominion of Canada in the first instance to have brought the east and the west together by undertaking the management, and even the expense, of operating a road between the populated east of Canada and the populated west of Canada. In other words it would have been good policy to bridge over that uninhabited district which divides the east from the west and thus to bring together, so far as transportation is concerned, the east and the west in a way in which they are not now brought together. But there is nothing in that direction in the proposal before us. The proposal of the government is one which provides for the building of a third railway through this uninhabited country, where one of the existing railways is able to carry five times the traffic which passes oyer it at present. A condition of that kind is one which should have been adverted to by the hon. minister, and he should have presented reasons that would convince the House, in the face of these circumstances, of the necessity for building this road. I am certainly in favour of providing out of the finances of the country or putting upon the credit of the country any burden necessary to make our transportation facilities all they ought to be to meet the rapid growth and development of the country; but I believe in doing that along well considered business lines, and I do not believe in entering into a proposal of this kind or any similar proposal until it has been thoroughly worked out and considered upon economic lines. Subject to that condition, I am always ready to support the government in any proposal that will attain the end we all consider so desirable.
My hon. friend the Minister of Railways says that when this line is completed the west will be pretty well served. Six or seven years ago I said in this House that the Canadian Northern railway had even

then the status of a transcontinental railway. I know that we all marvelled at the wonderful enterprise of the men at the head of that undertaking, and I for one will be disposed to go as far as any man in aiding any undertaking brought to the attention of the House, which would make their work in providing transportation facilities for the people of Canada more effective than it is to-day. But when the Minister of Railways tells us that the needs of the west will be well taken care of when this road shall have been completed, I would like to tell him that I can hardly agree with that, because the west will require, probably in the not distant future, a road through the northern part of that country, along the very line through which it was originally proposed to build the National Transcontinental, but from which it was afterwards diverted. No one who heard or read the utterances of the right hon. the Prime Minister, and of his colleague at the time, when that proposal was first under consideration, can fail to remember that the road, as originally projected, was not to be a road between the Canadian Northern and the Canadian Pacific railway, where the transcontinental runs to-day, but a road through the northern part of that great western country which would open up an entirely new territory.


Rodolphe Lemieux: Does the hon. gentleman say that the time may come when four transcontinental railways will be required?


John Graham Haggart: Five, six or seven.


Robert Laird Borden: I say that the northern part of that country for the de-velopement of which it was intended to provide by the National Transcontinental railway, and which could have been thus provided for, has not been provided for, and as that great country increases and develops, I have no doubt whatever, that another transcontinental will be necessary. But I do not say that such a proposal necessarily involves the construction of a road across five or six hundred miles of territory where there is a road to-day capable of carrying five times the traffic that passes over it, This question is one	which should be considered from a sound business and economic standpoint, and the money not wasted in providing for a third line where one is capable of doing all the work.
There are just one or two other considerations, because most of the matters' to which I desire to allude can be minutely noticed when we come to deal with the separate sections. My hon. friend the Minister of Railways and Canals (Mr. Graham) says that the increasing traffic will make this road necessary. He will Mr. BORDEN (Halifax)
remember that about two years ago, or perhaps last year, his views as to traffic on the Intercolonial railway, after the National Transcontinental was completed, were of a somewhat gloomy character. He did not look forward with such optimism to the prospects of traffic over the Intercolonial railway, when that traffic would in part have been diverted by the National Transcontinental as far as Moncton. And I think, to use his own graphic expression, he seems to consider it as essential that the Intercolonial railway should be hooked up to some other great railway for the purpose of securing traffic. I do not know whether he is building this road for the purpose of hooking up the Intercolonial railway to it. If that be his object I think that the House is reasonably entitled to some information as to the conditions under which that hooking up is to be effected, and as to whether the Intercolonial railway is to be controlled by this proposed road or occupy a responsible position with regard to it.
My hon. friend was reminded of the necessity of control of the rates. It is true we have a Railway Commission, and I am not sure that the control of the rates afforded by that commission can be improved upon. I do not think much of the minister's idea of the control of rates by competition, if that was in his mind when he spoke; but so far as the provisions of the contract with respect to rates are concerned, in my opinion they are utterly ineffective. I do not believe that the concluding paragraphs of these proposals, paragraphs 13 and 14, will have any effective operation at all. I have examined, as well as a layman could, the effective agreements between railway companies, as to the routing of traffic, and so far as I have been able to read in books and gather in conversation from men familiar with the subject, such agreements in the end do not usually prove effective, and the traffic in the end will go just where the conditions call for it to go. I am of the opinion that it will go pretty much, if not altogether, irrespective of such agreement as is contained in these proposals. I do not want to deal with matter foreign to these proposals, but I might point to a statement made by the hon. minister himself, and certainly by his predecessor, as to arrangements made between the Intercolonial railway and the Grand Trunk railway which amply prove the truth of the statement I have just made. We find that the Grand Trunk railway-which after all is the same practically, though not technically, as the Grand Trunk Pacific-is at present enlarging its terminals in the United States, and acquiring other terminals there, and is basing its action in that regard and its arguments before the legis-

lative bodies in the United States upon the grounds that these terminals are to be provided for the purpose of handling the traffic gathered up in Manitoba, Alberta and Saskatchewan.
It is perfectly obvious to any hon. gentleman who knows the provisions of those agreements that the government are helpless in that matter. They may be helpless in that matter for a reason which cannot be urged under this agreement because I observe here that the provisions as to routing traffic are to be embodied in a stipulation to which not only the Canadian Northern Ontario Railway Company is to be a party, but the Canadian Northern railway itself is to be a party. If that is necessary in this agreement surely it was ten times more necessary in the agreement which was made between the government of Canada and the Grand Trunk Pacific, and yet my hon. friend the Minister of Railways and Canals, although he was not in the House at the time, will remember that we urged on the government the absolute futility of any such stipulation as was embodied in the agreement between the government and the Grand Trunk Pacific railway, unless the Grand Trunk Railway Company itself was made a party to that stipulation, and became bound thereby. That we were right on that occasion is demonstrated by the action of the government at the present time, if the agreement is of any value at all, which I greatly doubt. ' But so far as control of rates and routing of freight are concerned, I hope I may be wrong in the opinion I entertain, but I do most thoroughly and sincerely entertain the opinion that in the end these provisions will be found absolutely ineffective, and that the routing of traffic will proceed according to conditions and influences altogether outside of any such stipulation.
The Minister of Railways made one other suggestion which indicates that this agreement is of a very remarkable character; he says that it is a good agreement for the country if the company does not default, and it is even better for the country if the company does default.


George Perry Graham: Hear, hear.


Robert Laird Borden: If it is an even better agreement for the country if the company does default, and fails to carry out the stipulations which the government thinks it worth while to insert in this contract, that seems to me to be a sound and. strong argument why some policy other than that now suggested should have been embarked upon by the government. If the default of the company is to be a good thing for the country, what is the reason for entering upon these stipulations, a nonenforcement of which will be a good thing
for the country? I venture to say to the minister himself that in making that statement he has made a very strong argument against his own proposals this afternoon. However, when we come to consider this clause by clause and paragraph by paragraph I shall perhaps have something more to say upon that particular point. In the meantime, I can only express my regret that upon some matters which I regard as of very exceeding importance, in this connection the Minister of Railways and Canals has been so reticent and silent this afternoon.


John Graham Haggart: Mr. Speaker, with the former part of the remarks of my hon. friend the Minister of Railways and Canals (Mr. Graham), in which he describes the magnificent country which this railway is going to serve,
I perfectly agree. We take pride in the Northwest, and its development. Of that country the Conservative party have reason to be proud because it was first opened by them, and the railway development of the great Northwest is due entirely to their policy.
As to the necessity of this railway, we have had very little reason given by the Minister of Railways. When we come to look at the route of the road to be built from Montreal up to Port Arthur, we find that as far as Sudbury it is not at any point more than 7 or 8 miles from the Canadian Pacific railway, and for most of the distance it is within two or three miles of that road. Did the minister have any conversation or any communication with the Canadian Pacific railway or with the Grand Trunk Pacific railway after inducing the parties to subscribe capital for the purpose of building the road, before he agreed virtually to build a road for a rival corporation to destroy or injuriously affect the property built by these subscribers, to a certain extent with their own money?
Why does the minister ask for the building of this particular road? If the country required the transportation we would be perfectly willing to grant it. Transportation is the problem which confronts this new country at the present day. Is it a necessity to double the road from Port Arthur down to Montreal almost along the line of the Canadian Pacific railway for the purpose of developing that country? It is true that the Canadian Northern railway are a very energetic and enterprising company, that they have built with assistance or out of their own money, I do not know which, and acquired, nearly 4,000 miles of railway in the Canadian Northwest, that they have made arrangements-with the British Columbia government for making connections with the seaboard on the Pacific and that they have a railway from Winnipeg down to Lake Superior, and

intend to have a connection, I think the minister said, from Victoria harbour down to Montreal, utilizing the same route as the Canadian Pacific railway and the Grand Trunk Pacific railway intend to utilize. It may be in the interests of the country, there may be a reason, but none has been advanced by the Minister of Railways for the necessity of this new line of road. It may be that even in a country where there are no present requirements for a railway, a well managed and enterprising line can create a business which will justify the building of the road, but if there is no necessity for anything of the kind why should we injure capital which has already been invested in other roads and interfere with those who have put their money into these undertakings? The minister says that the Canadian Pacific railway passes to the south of the magnificent clay belt of northern Ontario, that this road goes through the middle of it, and that the Grand Trunk Pacific railway goes to the north of ft. The proposed route of the Canadian Northern road from Pembroke up to Sudbury passes at the clay belt within six or seven miles of the Canadian Pacific railway, not more than that.


George Perry Graham: My hon. friend is altogether wrong in his distances between the Canadian Pacific railway and this road.


John Graham Haggart: Then the map placed upon the table by the minister is wrong. According to the map it is within a mile of the Canadian Pacific railway.


George Perry Graham: For 50 or 60 miles it is. fairly close.


John Graham Haggart: At no point is it more than ten miles away.


George Perry Graham: There are points on the two lines that are 50 miles apart.


John Graham Haggart: Then, the minister should lay before the House a correct map. It is impossible that they can be 40 or 50 miles apart. It may be 40 or 50 miles from the Grand Trunk Pacific, but if you are going from Pembroke up to Sudbury, you cannot be further from another line than 15 or 20 miles. And the map the minister has furnished shows that it is only 15 miles. If you want to develop the country, run your road through parts of the country that are not served already. I consider the present location of this road an injustice to existing railways. For the whole distance from Montreal to Port Arthur it is virtually a paralleling of the Canadian Pacific railway. It is a direct injury to that company and an attack upon capital which this country solicited to be invested in their undertaking. I would not care about that Mr. HAGGART (Lanark).
company, or the injury to capital if it could be shown that this scheme was necessary for the development of the country. But nothing of that kind can be shown. There might be some sort of excuse for it if there were any control of rates. The minister tells us that the Railway Commission control rates. They do to a certain extent, but far more efficient control would be gained by a direct bargain with the company giving the government the right to reduce rates without appeal to the Railway Commission, such a bargain as was made in British Columbia and in Manitoba.
There is another point. There is to be a road from Montreal to Toronto. A part of this line is built from Montreal to Hawkesbury bridge and from Hawkesbury bridge to Ottawa. You exchange securities. They give bonds of $30,000 or $35,000 a mile on a road already completed for the purpose of securing a guarantee on the part to be completed. We have had no statement as to what the cost of the road is to be. In a general way it will cost about $50,000 a mile. But you notice the absence of anything about terminals in this arrangement. Are we to have security on terminals?


George Perry Graham: At Montreal?


John Graham Haggart: Yes.


George Perry Graham: It does not include the terminals at Montreal?


John Graham Haggart: It does not include the terminals in any city-Montreal, Ottawa, Toronto or Hamilton. What is the good of the security on a road when your security does not include certain parts of the road, and also does not include the terminals? The minister says it would be a good thing if this road to Port Arthur were made an extension of the Intercolonial, and run as a government enterprise. It has long been the ambition of the east to get a connection of that kind. And it may be a good thing; but I have had something to do with the In tercolonial, and I think my hon. friend (Mr. Graham's) experience with a government managed road, before the commission was appointed, must convince him that such a thing would be a bad investment for the government. We are not only to have this magnificent line of communication with the northwest, but we are to have a new line in New Brunswick, a shortening of the road to St. John. I think that in the construction of the Grand Trunk Pacific, provision of 'this kind should have been made, because that line is the shortest line from Edmonton to St. John. It was folly, in my opinion, to build a road to Moncton' and from Moncton to St. John merely to please certain people in New Brunswick. But that

is not all. The statement of the Minister lof Railways threatens us with the introduction of resolutions taking over two or three more railways in the eastern provinces. I would like to know what railways they are, and what is the occasion of the step thus indicated. I think the real occasion is the prospect of an election in the fall. If the hon. minister can tell me of two or three railways in the maritime provinces that are in a financial position to justify the taking of them over by the people of this country and making them part of the Intercolonial, he will do something which I hardly expect, with all his capabilities, he is able to do.
We are a prosperous country, thanks to the development of the northwest, and thanks for that largely to the magnificent showing of the Canadian Pacific railway and its development. But why should hon. gentlemen opposite encourage that road? Their policy is not to take traffic from the west to the east over our own lines, but the doctrine they preach to the farmers of the northwest is the opening up of the markets to the south of us.


Mr. STANFIELD.: They will drop that.


John Graham Haggart: They dare not drop it; they have to go on with it. These are the transportation developments they promise the people of this country. I long ago stated that the principal improvement in our transportation facilities that is now needed is water communication with the northwest to a certain extent, the building of the Georgian Bay canal. The building of that route would do far more for the country than the loaning of large sums of money as this government is doing. And what is it all for? It is to make friends of certain railway contractors at a time when their friendship may be most needed. This and other indications remind us of the desperate state to which hon. gentlemen opposite have been reduced. They propose the building of new lines of railway in a magnificent scheme of communication with the northwest, they indicate their intention of taking over a lot of railways in the maritime provinces, and they have promised an enormous expenditure for public works in many parts of the Dominion. These things show the desperate condition of the occupants of the Treasury Benches, and the impossibility of their developing a policy which will in a fair, honest and upright way appeal to the people of Canada.
As to the gentlemen who are making the application, I feel sympathetically inclined towards them. I recognize that the Mackenzie & Mann interests have done a great deal for Canada, and the energy thev have displayed, and the success they have achieved is greatly to be commended. I
do not think, however, that is a reason for us going^into this undertaking at the present time," when we are so near a long adjournment, and going into it in this hasty way. I regret that the minister did not see fit to bring forward this proposition at a time when it could be carefullv considered and discussed. It is impossible that this matter should get fair consideration now, not only by reason of the state of the session, but because the minister has been so reticent in what 'he has said this afternoon. He has given no information to enable us to decide upon the merits of this scheme. One would think that in a matter of this kind where securities are offered to us, one of the first things the minister would tell us would foe the probable cost of the road.


George Perry Graham: I gave that to the House. I was asked by the hon. member for Lamb-ton (Mr. Armstrong), what would be the cost of the road, and I answered that a certain standard of road, as laid down in this contract, will cost at least $50,000 a mile, and perhaps $55,000.


Haughton Lennox: The minister has not told us how that amount is arrived at, what surveys have been made. We have had a lot of experience in matters of this kind. In 1903, when the Transcontinental was proposed, we were assured that the government knew all about it then, and we are told now by the minister that it is estimated this will cost about $55,000 a mile. Is there any good basis upon which to believe that is correct? We were told that the Transcontinental was expected to cost from $25,000 to $28,000 a mile, and the expensive portion of it was in Quebec, feo that from Quebec to Winnipeg it was expected to cost $25,000 a mile, and we were told that this estimate was based on ample surveys and investigation. But it turned out that that was not the case at all; it has turned out that that road, without counting a cent for interest, will cost over $100,000 a mile. Now, if it turns out that this road will cost, instead of $55,000, $100,000 a mile, where will we be at?
Mr. GRAHAMt. The security will be better.


Haughton Lennox: If it turns out that this road will cost $100,000 a mile, these gentlemen, just the same as the Grand Trunk Pacific, will come again, and when our money is invested in it we can't refuse. The minister has given us absolutely no reliable data upon which to form an opinion as to whether this is a good scheme in the sense of the security. Then the minister has made it evident, in his answer to the question of the leader of the opposition, that he has no idea as to what traffic is going to feed this road. He has pretended'

to tell the House that there will 'be such a large volume of traffic as will necessitate the building of another transcontinental line_. We already have the Canadian Pacific railway, which could handle vastly more traffic than they are getting, and we will shortly have the National Transcontinental railway, which will require to handle' an enormous amount of traffic to pay any reasonable dividends, or else the people will have to pay enormous rates for transportation. We' will have the Hudson Bay railway opened up, which will divert traffic to Hudson Bay. W6 have the Georgian Bay canal scheme before us, and a promise by the government that they are going on with that, paralleling this enterprise right along. We have the Welland canal scheme, and gentlemen in that country are depending upon the govermpent to advance that scheme and make a great additional highway for the commerce of the west. Then we have the Jim Hill roads, all with their noses upon the international boundary, waiting for this reciprocity scheme to get through, when they will" come in and absorb a very large quantity of our traffic. With this divided traffic, with more roads by far than are needed if all these communications are opened up, we will have these various lines impoverished to a considerable degree, and the result will be that the farmers of the west will be paying very large additional sums for transportation. Now, I feel that the government is not to be commended in bringing this scheme in at the present time and forcing it on the House. There is no one on this side of the House, I believe, that wants for a moment to oppose any scheme that will aid in the development of Canada ibut every member of the House has a right to ask The government to give us a reasonable opportunity to examine this scheme. If the minister proposes to put this through before we adjourn in a week or two hence, he is not giving parliament the opportunity we should have to investigate this matter.


Mr. WHITE (Renfrew).: In view of the fact that a section of this line traverses a portion of my constituency, I feel it my duty to make a few observations. I agree entirely with what the minister has said regarding at least that portion of the line which traverses the territory with which I am acquainted. So far as the county of Renfrew is concerned, the section through which the proposed line will be built is a very fertile section, a largely populated section, and a section which, up to the present time, has been without railway communication. I feel, therefore, that I would not be serving the interests of my constituency if I were to offer any opposition to this scheme. I quite realize that one of the great problems of this country is that of transportation. We all know what the Mr. LENNOX
Canadian Pacific railway has done for this country. I believe that the Canadian Pacific railway, the building of which, I may say, was opposed very strenuously by our hon. friends opposite, had more to-do with the development of this country than any other scheme that was ever projected. I do not wish to support any project that is going to be in any way detrimental to the interests of the Canadian Pacific railway, but I feel that, while this road may traverse the country in close proximity for a certain distance to the Canadian Pacific railway, yet I -believe that with the great prospects which we have ahead of us, and in view of the fact , that a large portion of the country through which the road passes is pretty well settled to-day, there will be room for both lines. I entirely agree with the remarks of my hon. friend from South Lanark (Mr. Haggart) as to the great importance of the water carriage routes in this country. When the Supplementary Estimates came down the other day I was very much disappointed to find that there was no appropriation for the commencement of the construction of the Georgian Bay canal. While the Supplementary Estimates amounted to some $17,000,000 and included in that amount there was some $2,000,000 for the Hudson Bay railway, however, there was not one dollar for the commencement of this great work which, to my mind, is one of the most important projects which has ever been contemplated by this country. I trust that the government will see its way clear, before the end of the present session, to bring down a further supplementary with a substantial amount for the construction of this great waterway which, in my view, would tend very materially towards the cheap transportation of the grain products from the west to the east. In conclusion, Mr. Speaker, I merely wish to state that I am in accord with this proposition which is now before the House.	.


Mr. GEORGE GORDON (Nipissing).: Mr. Speaker, I would not be doing justice to the constituency which I represent did I not also say a few words in regard to this railway project. The hon. member for North Renfrew (Mr. White) has said something with regard to that portion of the country through which this road will run -Renfrew and practically as'far as North Bay. I submit that from North Bay to Port Arthur, the Canadian Pacific railway, as it now runs, does not fulfil the requirements for the development of that country. The country through which this new line is to pass from -North Bay to Port Arthur cannot be served by the Canadian Pacific railway as now located. A great many members of this House, I am sorry to say, are not informed with regard to the

great extent of that country. They forget that although the distance on the map looks very short between the Canadian Pacific railway and where this line will go, it is not as short as it is represented to be. The Canadian Pacific railway from Sudbury to Port Arthur runs through a very rocky country, as those of you who have gone through that country are aware, and the location is too far south altogether of the great clay belt through which this new road will go to be of any service to it After passing North Bay, I understand the new line will go direct to the Sturgeon river, then up the Sturgeon river passing over to Lake Wahnapitae and from Wall-napitae into Hutton. In all that country from North Bay to Hutton there is good fertile farming land which cannot be successfully worked without railway facilities, and in additiojj to that there are immense quantities of standing timber. Looking upon the whole matter as I do, I cannot do otherwise than feel that it is a good thing for the country that this road is going to be built. With regard to the guarantee which the government has agreed to give to this company I have nothing to say other than this, that if the road cannot be got through that country for a less consideration, then I -would have to endorse this proposition.


[Stage Direction]
Motion agreed to, and House went into committee on the resolutions.
George Perry Graham: I was very anxious to have a first mortgage on the line between here and Montreal, as I thought it would, perhaps, be one of the most valuable stretches.


Robert Laird Borden: There is a good deal in the suggestion of the minister that he wants such security that if default should be made and foreclosure had, he will have a continuous line from Port Arthur to Montreal, particularly as he is stipulating for bonds of a previous mortgage issue to the extent of $35,000 per mile upon the complete portion of the line between Ottawa and Montreal.


George Perry Graham: From here to Hawkes-bury.	.


Robert Laird Borden: Does not the verv consideration which the minister mentioned emphasize the importance that the mortgage should include the terminals? The minister puts it in this way. He will guarantee bonds upon the portion of the line already completed for the reason that we want a charge upon the whole line, because a charge upon a part of the line might be less valuable if we had to foreclose. My hon. friend (Mr. Haggart, Lanark) points out that if you have no mortgage upon the terminals and you have to foreclose, your line will be incomplete until new terminals
are provided. Is not that exactly the point the minister makes?


George Perry Graham: It is in a way. But, the terminals to be provided in Montreal will be very, very expensive, and to my mind the company could not finance these terminals if there was a first mortgage preceding the bonds they would have to issue. I would not be surprised if the terminals in Montreal city would cost sixty per cent of our entire guarantee on the line, and I do not think that is an extravagant estimate, i Mr. BORDEN (Halifax). Twenty-one millions.


George Perry Graham: I would not be surprised if the terminals in Montreal before they get through with them will cost that amount of money. I discussed the terminal situation with the company very thoroughly, and they argued that they could not finance terminals of that kind if they had a first mortgage standing against them, and that looks reasonable.


Robert Laird Borden: It looks exceedingly reasonable from their standpoint, but the standpoint of the country has to be considered. If you do not have a charge upon the terminals you at least should provide some means by purchase or power of expropriation to get them in case you should have to take over the road. So far as I understand it, the road would be of little use t<. you without the terminals.


George Perry Graham: If the road became our property.


Robert Laird Borden: When taking security of this kind, the only business way of looking at it is to consider the possibilify of being obliged to foreclose. The minister has given a reason that appeals to me why it would not be practicable to include the terminals in this mortgage, but he has not given any reason for not providing means to acquire these terminals in case it becomes necessary to buy in the road.


George Perry Graham: I am not sure that there is not something in the agreement by which that can be worked out, but I have made a note of the matter and I will look into it.


John Graham Haggart: Do you know the amount of prior securities issued on the road from Ottawa to Niagara, or the amount they have the right to issue?


George Perry Graham: I think it is $30,000 a mile.


John Graham Haggart: And you likewise do not take security on the terminals there?


George Perry Graham: We take security on all their line which is included in this $30,000 a mile. I imagine that the terminal situation in Toronto will be similar to the terminal situation in Montreal. At present they have no terminals in Toronto and they

use the connection with the Grand Trunk, but I am told they are to provide other terminals that are not now in existence, and will not form part of this contract.


John Graham Haggart: The first mortgage on that portion will be only $30,000 per mile.


George Perry Graham: I think so.


Mr. LALOR.: In addition to this, do they get land grants or subsidies from the provincial government?


George Perry Graham: I think they have a grant from the Ontario government in reference to some land in the clay belt. The portion of the line from here to Montreal got a regular subsidy, but we are extending the guarantee over all the line from Ottawa to Montreal, because we want to get first mortgage security on the entire line from Port Arthur to Montreal, as it would not be a continuous line without that.


Francis Ramsey Lalor: There is no cash subsidy from the Dominion?
Mr. GRAHAM Not other than I have stated.


Mr. CURRIE (Simcoe).: I would remind the minister that the Canadian Northern railway have considerable terminals in the east end of Toronto at the present time.


George Perry Graham: I should not Have said they had no terminals in Toronto, but what I had in mind was the larger terminals which are contemplated.


Mr. WILSON (Lennox).: I would like to know how much the guarantee amounts to?


George Perry Graham: Approximately 1,000 miles at $35,000 a mile.


Thomas Simpson Sproule: That is a guarantee practically forever.


George Perry Graham: The principal falls due in 50 years.


Thomas Simpson Sproule: If the principal be not paid at the end of 50 years, we would be responsible for its payment?


George Perry Graham: We guarantee the Canadian Northern Ontario railway, and we are guaranteed behind that by the Canadian Northern railway parent company itself. We have two guarantees. Suppose there were a default, then the Canadian Northern railway guarantee that the Canadian government will not lose. Suppose the Canadian Northern railway then defaulted, which I think is practically impossible, the worst that could happen would be that this line would become the property of the Dominion, and we would have a line which cost more than $50,000 per mile to build, at $35,000 per mile. We have the first mortgage.


George Perry Graham: 


Mr. BLAIN.: 1 suppose there was some promise given as to when the railway would be constructed between Niagara Falls and Toronto, more particularly as the guarantee is to cover that part of the road, it being a second mortgage. When does the minister expect the work will be completed?


George Perry Graham: I have no information as to the building of the line between Niagara and Toronto. There are certain complications., but the line between Toronto and Ottawa is under construction, and the Canadian Northern railway will have a line from Toronto to Quebec.


Richard Blain: The other part is very important for that section of the country. We did suppose that when the government was coming to the assistance of a company, it would see that this section of country was served by the construction of the road. My hon. friend will understand that a second mortgage upon a railway not yet constructed is not worth much. I -would suggest that the minister should see that the company is urged to construct that part of its line. He says there are difficulties surrounding it. I suppose there are, but the company is occupying a place for the construction of a railway and doing nothing practically upon it.


George Perry Graham: If I remember correctly, only a few weeks ago we got certain complications straightened out as to the entrance from the west in Toronto, and by common consent a route was approved into the city from the west.


John Graham Haggart: Have you, independent of those securities, the guarantee of the company on its whole undertaking?


George Perry Graham: In addition to this security of the Canadian Northern Ontario Company, we have the guarantee of the Canadian Northern railway. Where there are several securities on lines, the direct guarantee of the Canadian Northern railway is as valuable as if we had another mortgage on the top of the ones now existing on the western lines.


Thomas Simpson Sproule: So far as I can judge public opinion, the sentiment is rapidly growing that we have reached the time when it is not the part of wisdom to grant more subsidies to railways, especially through portions of country already well served. This is presumed to be a valuable piece of road to carry the trade between the east and west, but at present we aTe struggling with reciprocity negotiations which are calculated, if they go through, to take a large portion of that trade to the south, and probably take it all. It seems to me, therefore, that while the government are providing on the one hand to secure the

trade from the west to the east, they- are providing on the other to take it away. Has the Minister of Railways made any estimate of what is likely to be the traffic between the east and the west over these three roads when built? We have the Canadian Pacific railway and the National Transcontinental railway through that country, and now it is proposed to build another, and we are proposing to build this third line at the very moment when we are asked to pass a treaty which is likely to divert the traffic across the southern boundary. I am inclined to think that the people will regard this scheme of guaranteeing the bonds of a railway, to run through a section of country where it is not needed as rather profligate and an abuse of the power of parliament. If this road were to pass entirely through a new country which had no railway facilities, something could be said in its favour, but that is not the case. If I understood the remarks of the minister correctly, the intention is to run this line between the National Transcontinental railway and the Canadian Pacific railway away round north of Lake Superior. These roads are not built far apart, and the section of country is one not likely to afford much traffic, so that the road will have to depend on the traffic from eastern provinces to the west, and vice versa. Is the traffic in that new country likely to support three railways, and enable them to earn a fair return on the money invested? If it is not, we stand to lose by this guarantee. The minister should have submitted some approximate calculations showing what traffic is expected to go over this line, especially in view of the fact that the present railway running through that district is able to handle five times as much traffic as it is now getting. And he is doing this at a time, when iE reciprocity be adopted, from 25 per cent to 40 per cent of that traffic will cross the boundary line, and not go over this railway at all. I do not think they are. We have it brought up in various ways in the country, and we frequently hear an expression of the opinion of the people regarding it. This is a large guarantee, and it is for a long time. It is not the sum total of what we will he forced to give because we will have to give many other railways subsidies in the future. They all tend to create an obligation on the country, and if anything should happen to the Tailway the country would have to make good its guarantee. I think the minister should have submitted to the House the clearest evidence that there is an urgent demand for this railway before the country would be satisfied that we were doing our full duty in supporting this proposed guarantee.


George Perry Graham: Of course the data as to the future necessities of the carrying
trade of Canada will be large or small according to the faith we have in the development of the country both east -and west. In introducing this resolution this afternoon, I explained the situation of this railway, that it has a system of 4,000 miles of railway in western Canada, with no independent outlet to its other system in eastern Canada, and that I was satisfied that it was absolutely necessary in the interests of both the west and the east that it should have this connecting link.


Thomas Simpson Sproule: The minister seems to base his argument on faith. He must have gone to Sunday school as a boy, and must have remembered the passage: ' If ye have faith as a grain of mustard seed, ye shall say unto this mountain, remove hence to yonder place; and it shall remove and nothing shall be impossible unto you.'


George Perry Graham: It is not a bad thing to remember.


Thomas Simpson Sproule: He might have faith that he could bring the moon down here, but not many would believe his faith could accomplish it. When passing through that country did the minister take the trouble to look into the situation at Duluth, Superior, and Minneapolis, to ascertain what expenditures this company propose making there in view of the proposed reciprocity pact? I am told they are preparing for very heavy expenditures to receive the freight crossing the line there. That would of necessity reduce the amount of traffic for their main line. I presume the minister paid no attention to that, however, because it was not under way when he was in the west. It seems to me that the data upon which the minister is asking us to commit the country to an undertaking such as this, are very limited. Is there any agreement or undertaking with regard to any reduction of rates or anything of that kind?


George Perry Graham: The rates on this road as on all roads in Canada under federal jurisdiction, are controlled by the Board of Railway Commissioners. We have a clause in the resolution which says that the rates from a Canadian point of shipment to another Canadian point, must not in any case exceed the rate to a corresponding American point. The hon. gentleman will remember that the Canadian Northern has no eastern terminals in the United States. The Canadian Pacific Railway and the Grand Trunk railway have, but the Canadian Northern have not.


Thomas Simpson Sproule: When Manitoba agreed to guarantee this company's bonds they secured a substantial reduction in the rates for the carriage of wheat. If the company were willing to do that for Manitoba I would assume that they would be willing

to do it for this government. If we were able to get the same proportionate reduction in the rates eastward from Port Arthur as this company granted on their Tates in Manitoba, it would be a very great advantage to the people of both the east and the west.


George Perry Graham: My hon. friend will see that there is a great difference. In the case of Manitoba there is a short line to begin with, to get to a lake port. In the second place, Manitoba has no machinery for making or revising rates such as the Canadian parliament has devised for the control of rates through the Kailway Commission.
Now, the Canadian parliament, as I have stated, has established a Board of Railway Commissioners to Tegulate rates and has provided them with all the necessary machinery for that purpose. No rate can be put in force until it has been approved by the board, and before a rate is made [DOT]everybody can be heard. There is a clause in the Bill which I now have before the House-I hope I can get it through this session-which changes the time of notice from ten days to thirty days. So, in the case of any new traffic arrangement anybody concerned will have a month's notice and an opportunity to state his case within that time. The point I make is that there are so many conditions as to rates over the whole Dominion, that unless you have some body with expert assistance and all the machinery of investigation, and with full power in the matter, any attempted protection wi.ll be comparatively futile. In Manitoba, there were certain well established rates for a certain number of miles between certain parts-


Morley Currie: About three times the other rates.


George Perry Graham: Pretty stiff rates;-and the Manitoba government simply made terms concerning those rates. But there are no varying conditions as there are all over Canada. You cannot make a set of rates for the Dominion which will continue to be applicable. And this parliament or the Governor in Council has not the necessary machinery to deal with these matters. So, we have established a body which has all the machinery, and I think we 'cannot do better than leave it in their hands.


Thomas Simpson Sproule: We know what the Canadian Pacific railway rates are from Port Arthur to Montreal. If we got the Canadian Northern to give a reduction of 2 cents a bushel in consideration of the guarantee, it would force a similar reduction on the part of the others. We have subsidized the other roads, and if they were forced to do this, there would be no great injustice done them, provided thev could do it and still earn a reasonable rate on Mr. SPROULE.
the money invested. And it would be a very substantial advantage to the people of the west as well as to the people of the east.


Morley Currie: The question raised by the hon. member for East Grey (Mr. Sproule) in regard to freight rates is one of which the minister must, sooner or later, take cognizance. For instance, I think that the fifth class, commodity rate from Montreal to Winnipeg is 70 cents a hundred, and of that, the proportion from Port Arthur to Winnipeg is 40 cents a hundred. So that the getting of a special rate by the province of Manitoba on that guarantee is now working against the interest of the shippers now that we have the Railway Commission. If the commission has complete jurisdiction over this part of the route, I am satisfied that rate would be equalized a little down. The time is coming -I know it is heresy for me to say so here -when we shall give no more of these guarantees. There is no reason why this company should not get a guarantee as well as any other, because they have always acted in good faith with the country, they have built a very large mileage and have opened up a vast extent of new territory. To my mind, the most essential thing in connection with railway building in this country in the future, is the building of branch lines into territory now destitute of railway accommodation. The day of building or subsidizing competitive through lines of railway will soon come to an end. We shall then act as the older countries do, as France does, for instance, which country, years ago, took the view that the building of competitive railways was an injury to the country, a waste of capital, and that it was better to control the traffic and rates. It is plain that one road carrying all the business of three roads can carry more cheaply, and make more money than three roads, because there is only one set of fixed charges on which interest has to be earned. Some day we shall have to consider that in Canada, and then I think we shall assist in building up branch roads rather than subsidize long competitive lines across the country. The question of exchange of traffic will then come up. I did not hear the minister say that he was putting a clause in this Bill which would compel the exchange of commodity traffic. If that were in the railway law, every shipper knows, there would be no necessity for competitive railway lines. The question is not understood by the great majority of people, because they do not come in direct contact with tjje question. There are two rates on railways, the local rate and the commodity rate. The commodity rate is a low rate for car lots which extends over the line of that railway only, and the moment the traffic goes to another line

that other line will charge local rates. So, you cannot ship over two lines without paying an excessive rate. The day will come, no doubt, when that will have to be considered. In this connection, the commission has not met the expectations of a great many people. The west to-day is clamouring for reciprocity. Why? because they say to the east: When you come to ship stuff to the west you give a preference largely to the United States lines, and send m over those roads instead of the Canadian roads. There are roads that have not connected up with the Northwest as it is proposed now to connect up the Canadian Northern, as for instance the Grand Trunk. If you ask the Grand Trunk to put a car on their siding to ship stuff to the Northwest over the Canadian Pacific railway right, they refuse to do it. They will allow their cars to go to the west except by the American route. I think that is a question that should be considered by the minister, and, if he has jurisdiction, some slight, exercise of the strong arm might help, or he might use a little persuasion with the commission to get them to change their ruling on that point. This action on the part of the Grand Trunk railway is a hardship to shippers. And the people in the Northwest, when they see cars coming from the other side of the line, consider that we in the east, especially the manufacturers are very unpatriotic, because they presume that it is done because it is cheaper to send by the United States rather by the north shore of Lake Superior, when, as a matter of fact, the freight rate is exactly the same. But the Grand Trunk railway has taken that position. The question has been brought before the Railway Commission and they have ruled that the Grand Trunk railway must have their way.
With reference to these terminals at Duluth I think the hon. member for East Grey has asked a question which should be considered. The_ Canadian roads are quite capable of holding their own with the Canadian government, and the American government or with any other government or corporation in the whole world. That may be a pretty broad statement. But the largest and strongest corporation in the world to-day, so far as I know, is the Canadian Pacific railway. When there was talk that our traffic was liable to go to the south, the Canadian railways took time by the forelock, and the Canadian Pacific railway and Canadian Northern railway are building terminals in Duluth-spending large sums of money there. By the way, does this guarantee cover the branch line they are building to Duluth?


George Perry Graham: No.


Morley Currie: I did not know whether the minister's charity extended that far.


George Perry Graham: Not farther than Port Arthur.


Morley Currie: It is well to consider these questions very carefully. Having in view the fact that from now on, it will be better for us to confine the railway business largely to the extension of branch lines into unoccupied territory.
It is far better for them to have a number of branch lines built out there, than that there should be another transcontinental line, at least for a number of years, in view of the increased earnings which these branch lines will give the main line. If you have a number of branch lines you get a large quantity of freight from them, you have more freight to carry over the main line, and in the long haul the commission will give lower rates, and the products of the country will go cheaper over one line than over two or three. There is another question affecting the northwest. A few years ago Railway Commissions were established in some of the western states; I will take the state of Minnesota as an example. The state established a Railway and Warehouse Commission, which commission under their law, was to have jurisdiction over all the freight arising from one point in the state to another point in the state. The state commission claimed they had a perfect right to that control; whereas the federal commission only had jurisdiction over freight arising in one state and going into another state. That was unfortunate to some extent. The state legislature appointed men on that commission with largely socialistic views, and they proceeded to cut all the rates in the state of Minnesota one-half or one-third of what they were previously, establishing cheaper freight rates than were known anywhere else in the west. That tariff of rates has been published, and can be obtained by the Minister of Railways on applying to the secretary of the commission in St. Paul. A large number of these tariff schedules of the state of Minnesota have been sent broadcast all over the Canadian west, and that is the secret of a good deal of the discontent up there in regard to freight rates. For instance, the tariff establishing the freight rate in Minnesota is about one-half what it is in Canada for the same distance. Now, the other side of the story is that an appeal was taken against the Minnesota Railway Commission, the matter was fought out in the United States courts, and recently a judgment was given declaring that the schedules and freight rates of the state commission were of no value, that they were confiscatory in their nature, and con-



trary to a clause in the American constitution which says that private rights shall be conserved. The only thing I wish to say in conclusion is that I hope the minister will take up the question of exchange of traffic. I know he has put in several good amendments in the Bill, and I hope he will consider that some time, perhaps next session.


Thomas Simpson Sproule: Has any agreement been made whereby the traffic by this route is to be handed over to the Intercolonial. I could see an advantage in doing that, if it became a feeder of the Intercolonial.


George Perry Graham: At the present time we have an arrangement with the Grand Trunk for an interchange of traffic at Montreal; the government can terminate that arrangement at any time, but the Grand Trunk cannot. As I pointed out a short time ago, it will not be long before the Grand Trunk and the Grand Trunk Pacific will both be urging us for some modification by which they can handle each other's traffic. We are putting a clause in this agreement which says that when the government sees fit it can demand of the Canadian Northern railway, and they must consent, to make an agreement with the government to give and receive the traffic of the Intercolonial.


Thomas Simpson Sproule: Why don't you do it now?


George Perry Graham: We could not do it without breaking the traffic arrangements we have by which the Intercolonial, last year earned $1,600,000.


Thomas Simpson Sproule: Has the government ever considered whether it would be advisable to extend the Intercolonial to the Great Lakes?


George Perry Graham: That is a big question. When we got to the great lakes we would probably have to get a line of steamers and go beyond the Great Lakes.


George Taylor: In the Montreal ' Gazette ' of yesterday I find this item with regard to the Canadian Northern railway route:
Leaving Ottawa the line crosses the Ottawa river at Chats Falls into Quebec, passes through Norway Bay and crosses back into Ontario at Portage du Fort. It follows the Ottawa river to Pembroke, making a short line from Pembroke to Ottawa, At Pembroke the lines to Toronto and Port Arthur will diverge.
I see the map does not put it in that way, the map shows that it diverges al Ottawa.	.


George Perry Graham: I think the reporter haf got the point wrong. As a matter of fact the dividing line will be at Rideau Junc-Mr. CURRIE (Simcoe).
tion near Ottawa, and the Toronto line will go straight up as shown on the map.
At six o'clock, committee took recess.
After Recess.
Committee resumed at eight o'clock.
On resolution 10,


Mr. FOSTER.: Are these bonds guaranteed before the whole line is complete?


William Stevens Fielding: The usual method is that the guarantee is prepared and delivered to a trust company, and after the sale of any portion of the bonds the proceeds are paid out from time to time as construction proceeds. The guarantee is actually prepared and placed in the hands of the trust company before the completion of the road.


George Eulas Foster: And these guaranteed bonds are really to be disposed of in order to build the road?


William Stevens Fielding: Quite so.


George Eulas Foster: How is the interest met until the time of the opening of the road for traffic?


George Perry Graham: Further down my hon. friend will find that during the construction the company is to take care of the interest.


George Eulas Foster: This' really means, then, that outside of and beyond the $35,000,000 that is guaranteed the government meets the first two years' payments, making about $2,500,000, and the interest thereon, so long as it is not paid by the company itself; that is, it is an addition to the original subsidy?


George Perry Graham: Yes.


George Eulas Foster: But not contemplated as a gift?


George Perry Graham: Not contemplated as a gift. It becomes a part of the mortgage, and the repayment is secured by the mortgage to the government, and they pay interest on this interest for the tw'o years.


George Eulas Foster: These they are to pay at maturity?


George Perry Graham: We relieve them of the interest for the time being for the first two years.


Richard Blain: Will they he bound to purchase their equipment in Canada?


George Perry Graham: Oh, yes, we will certainly put that in the agreement.


Mr. CROTHERS.: What subsidies have ilready been granted by public bodies to my portion of these lines, and on what terms have these subsidies been granted?


George Perry Graham: For the line east of Ottawa the usual subsidy without conditions, has been granted by this parliament.


Thomas Simpson Sproule: For how many miles?


George Perry Graham: The subsjdy has been paid from Ottawa to Hawkesbury, which is about 56 miles.


Thomas Simpson Sproule: At $3,200 per mile?


George Perry Graham: They received a double subsidy, or nearly so. I think the Ontario government granted aid from Toronto to Sellwood.


Thomas Wilson Crothers: Oh, they granted a subsidy for 200 miles west of Sudbury.


George Perry Graham: Not a cash subsidy. A land grant was given by the Ontario government some years ago, but just what position that is in at present I cannot say.


Thomas Wilson Crothers: The provincial government may have made that land grant on conditions which may have given them a previous claim upon the road.


George Perry Graham: Oh, no.


Thomas Wilson Crothers: We surely ought to have information as to that.


George Perry Graham: We will have a first mortgage; we will see there is no previous lien on the line in any way.


George Eulas Foster: I would like to get at the whole amount of subsidies, aids of any kind, that are paid, or to be paid, for any and all portions of this road that is now being bonded for $35,000 a mile. I want the amount of money the Dominion government has paid and what it is to pad- what amount has been given by the provincial governments and what by municipalities, if any, what amount in money, and what amount in lands. The minister must remember that a guarantee of $35,000 a mile for one thousand miles of railway situated as this is, is a very substantial contribution to the total cost of the road. Has the minister any estimate as to what the road will cost?


George Perry Graham: I have the standard of the road here, and am told it will cost at least $50,000 a mile.


George Eulas Foster: Is that without equipment?


George Perry Graham: Without equipment.


George Eulas Foster: We give $35,000 for each mile in the shape of a guarantee and beside that we are making two and a half millions of an advance to say thg least, which will bring the total amount per mile considerably more than $35,000. We ought to know before this passes just exactly what aid this company is getting of any,
279J
and all kinds, what has been already paid on these portions built and what will be earned when the road is built.


George Perry Graham: I will get all that information to-morrow.
On clause 12,


George Eulas Foster: Does that include the whole Canadian Northern system?


George Perry Graham: Yes, the parent company gives its guarantee.


George Eulas Foster: It will be a company's covenant?


George Perry Graham: Yes.
On clause 3,


George Eulas Foster: At what time was this clause drawn.


George Perry Graham: This clause was drawn and redrawn. I would UQt like to say when it was finally completed.


George Eulas Foster: When was it broached?


George Perry Graham: I am afraid my hon. friend has something in his mind. This was finally drawn about two weeks ago.


George Eulas Foster: When was it first broached?


George Perry Graham: The first moment I discussed it with the Canadian Northern people, Which must have been three or four months ago.


George Eulas Foster: If the minister had to do it just now, I suppose that would be the first idea in his mind.


George Perry Graham: No matter what else was in my mind, that would be in it.


George Eulas Foster: Was this an after effect of conscience? It does seem odd to some of us that after doing all you possibly could do to draw traffic away from Canadian channels, in order to save your face you make a thirty-five million dollar grant to show the people how much you desire that all this transit should take place through Canadian channels. I think this clause is a pricking of conscience.


George Perry Graham: It is one of the original ideas.
On section 14,
14. That the company shall enter into an agreement with the government to secure or establish or cause to be secured or established, suitable terminals for the company within the city of Montreal and agreeing on the request of the government to enter into arrangements with the Intercolonial railway for the interchange of traffic between the company and Intercolonial railway at Montreal, for such period as the Governor in Council may determine and upon such terms as may be agreed upon between the parties, and should

the parties fail to agree, terms shall be fixed by the Board of Bailway Commissioners for Canada.


George Eulas Foster: Any penalty attached to this?


George Perry Graham: No, it is difficult to work out a penalty.


Mr. DANIEL.: I think it is generally understood that a large railway like this can really get freight over it routed in any direction it pleases. Some time ago Mr. Loud, of the Grand Trunk railway, gave testimony to that effect before some court which was trying to find out the reason why the Grand Trunk railway did not carry out an agreement made with the Intercolonial railway. Mr. Loud said that the Grand Trunk railway or any other railway could get almost the whole of its freight routed in any way it pleased. The provision here, therefore, is not a very strong safeguard. We have not had an opportunity of testing it with regard to the Grand Trunk Pacific because the road is not built, but it would look as if this provision wetre really not much of a safeguard. I should think that if the government decidedly wished to insist on the freight going through Canadian channels this clause might be made stricter and more of a compelling clause.


Mr. McCOLL.: I quite agree with my hon. friend who has just spoken (Mr. Daniel), that a railway company can have its freight routed as it likes.
There are six lines of railway running right along our southern border, namely, the New York Central, the Delaware and Hudson, the Rutland system, the Boston and Maine, and the Maine Central, connecting with the Quebec Central. They all terminate in Montreal. During the winter I hare had an opportunity of becoming familiar with the conditions that prevail over in Vermont. In the struggle before the legislature to prevent the Central Vermont getting into Providence, Rhode Island, a great deal of stress was laid on the fact that a new trade would be gathered on the northern boundary to be carried to the seacoast, and that trade would be largely the result of the reciprocity treaty now under discussion.
We ought to have some much stronger clause to prevent Canadian traffic being diverted into American channels. I will venture the statement, without consulting any of my colleagues on this side, that the remedy for all this is a close running arrangement between the Intercolonial railway and the Canadian Northern railway. My own opinion is that if we were to lease the Intercolonial railway to the Canadian Northern railway, or have it worked by that company on a joint working contract which would insure economy in its operation, the Intercolonial railway would become a valu-Mr. GRAHAM.
able asset producing annual surpluses. That would settle the future of the Intercolonial railway for all time to come. I am aware that the people of the maritime provinces in particular believe in its being a government owned road because it was built in consummation of the union between these provinces and upper and lower Canada. While I agree that it is a really national read, would it not be prudent to deal with it now for all time to come by leasing it to the Canadian Northern railway, or making an arrangement with that company for joint operation, tbe ownership still to remain with Canada. That would insure to the Intercolonial railway all the traffic which the Canadian Northern railroad can produce and relieve this country from a very great burden. It would relieve also the Minister of Railways from a very arduous undertaking, and we can all sympathize with him because he has not only the ordinary duties of his department to attend to, but also the duty of managing a large railway or of organizing others to manage it. If we could make such an arrangement as I suggest, it would go a long way to reconcile the people of Canada to this additional burden laid on them by the guarantee of this very large amount of bonds to the Canadian Northern Railway Company.


Mr. HAGGART (Winnipeg).: I think that this clause of the agreement should go back to the conveyancer. There is no penalty provided, but even if there were I doubt if that would help it. It looks very formidable, but if you had to enforce it, it would be very difficult to prove a breach; and when you did prove a breach, it would be more difficult to assess the damage.


William Pugsley: It seems to me that it is the only provision which can possibly be made, and the effect would be this, that if the company violated its agreement parliament would be free to take any action it might think proper.


George Eulas Foster: What action would you suggest parliament could take?


William Pugsley: My hon. friend could easily think what might be done. Parliament might take away certain _ privileges which the company might be enjoying.


George Eulas Foster: What privilege for instance?


William Pugsley: There might be many privileges. It would be easier to take action after the event than to anticipate now what action ought to be taken. If information came to parliament that this company was violating its bargain, parliament might legislate so as to impose penalties and to provide for a measure of damages, for a mandatory injunction or any other remedy which might be deemed proper under the circumstances.


Robert Laird Borden: Why should not parliament deal with it now?


William Pugsley: How?


Robert Laird Borden: If I were over there and were seeking to put this legislation through parliament, and had not any better reason than the Minister of Public Works has given, I think I would resign. It would be remarkable legislation to pass this Bill without any provision for penalty, or for a mandatory injunction or any of these other awful things the minister is speaking of, and then, after they had committed a breach of this innocuous paragraph, to come in afterwards and provide a penalty. No one ever heard of such legislation, at least I never did. If there are any penalties to be enforced, and mandatory injunctions to be asked for in the future on account of a breach of this provision, they should be set forth; any such provisions that might be made in the future by parliament, should be made now. I agree with the Minister of Public Works that it is difficult to devise a scheme to make -this particular kind of a paragraph effective. We pointed out in 1903 and 1904 that a similar agreement made with the Grand Trunk Pacific would probably be wholly ineffective. In the first place it could be evaded and even if the company were proceeded against for a breach of it, I cannot see that the government could recover more than normal damages. Any railway company making an agreement of that kind need have little fear of any proceedings for a breach of it. I think it is generally understood between railway companies when they enter into arrangements of this kind, that they can be either evaded without any risk of an action, or, if any proceeding is taken, the company committing the breach has little to fear from any action in the courts. That is the testimony of people familiar with railway affairs, they are really of little use, and I think this agreement would have to be construed from the standpoint of the country very much as if this paragraph were not here.


John Waterhouse Daniel: The minister asked for suggestions for the improvement of this clause. I would suggest that he strike out the words ' not specially routed otherwise by the shipper ' where they occur.


George Perry Graham: That would take away from the shipper his inherent Tight to route his business wherever he likes.


John Waterhouse Daniel: What are we giving the $30,000,000 for.


George Perry Graham: Not to curtail the rights of the shipper.


John Waterhouse Daniel: To provide transportation facilities for the shipper which otherwise he would not have.
^r- GRAHAM. That is true, but if we do that and take away the right of the shipper to say how the goods shall be routed, we might as well throw the money in the river.


Morley Currie: I cited a case this afternoon, where the Grand Trunk would not allow a shipper to route as he pleased. That is the ruling of the Railway Commission. What is the use of such sophistry as that?


John Waterhouse Daniel: When the late Mr. Blair was minister he would not allow freight to be routed over the Intercolonial Tailway, to go through St. John by the Canadian Pacific railway, he compelled it to go all the way by Intercolonial, he did not give the shipper freedom of choice as to how he should route his freight.


William Pugsley: Is my hon. friend quite sure about that?


John Waterhouse Daniel: Yes.


William Pugsley: I am satisfied he is entirely wrong. I have no doubt Mr. Blair made a rate over the Intercolonial railway as compared with the rate by way of St. John, so low that it was an inducement to the shipper to ship by the Intercolonial railway all the way to Montreal. I am sure my hon. friend is mistaken when he says that Mr. Blair refused to allow a shipper to route his goods whichever way he chose.


Robert Laird Borden: I do not think my hon. friend from St. John is wrong, because I remember the matter being brought up in this House and instances being given where goods had been consigned via St. John, and the Canadian Pacific railway to a point in Ontario. They did not arrive, and a couple of weeks afterwards they were discovered somewhere on the Intercolonial railway between Moncton and Quebec, they had been sent by the other route, and it transpired, unless my memory fails me, that that was shown to have been the result of instructions ~by which the directions of the shipper as to the route had been entirely disregarded.


William Pugsley: I am not a business man, but I know a little about some goods which have been shipped, and I know that in bringing goods to St, John from Toronto sometimes, the shipper .will say: Send by such a line to Montreal, Canadian Pacific railway to Montreal, or by steamer to Montreal and thence via the Canadian Pacific railway to St. J.ohn, or by the Intercolonial railway to St, John and those instructions, I have understood, are always carried out.


George Perry Graham: I have never had any trouble in any business I have had, and I

have bought a good deal of goods by car lots and less, in having the man who sold the goods send them by the line I asked him to.


Adam Brown Crosby: What line was that?


George Perry Graham: As many and -more than my hon. friend has in Halifax.


Adam Brown Crosby: And as long as my hon. friend is in office we will not have any more.


George Perry Graham: I am sorry he thinks so. It does not seem to be the impression of the people. I hope my hon. friend (Mr. Crosby), will help us to get more railways for Halifax. My hon. friend raises the question as between the Grand Trunk -and the Intercolonial, but if he had carried that out to its conclusion, he would have discovered that the arbitrators decided that in our favour, and compelled the Grand Trunk to give us the traffic that was to be ours under the agreement.


George Eulas Foster: When was that done?


George Perry Graham: A couple or three years ago. And ever since we have been getting traffic that we should not otherwise have got.


George Eulas Foster: With what result?


George Perry Graham: An increase of the income of the Intercolonial. Our exchange in traffic at Montreal last year gave us, I think, $1,600,000.


George Eulas Foster: What happened in reference to the preceding years when they had practically denied the agreement and failed to carry it out. Has the minister received anything on that account?


George Perry Graham: I have not that in memory. I cannot state the facts at the moment. The situation of the Canadian Northern under this bargain is a little different from that of the Grand Trunk Pacific under its contract. I think the leader of the opposition (Mr. Borden, Halifax). referred to that. The Grand Trunk Pacific and the Grand Trunk are different entities, although identical interests. But the Grand Trunk is not a party to the agreement with the Grand Trunk Pacific, so far as the routeing of traffic is concerned. The Grand Trunk Pacific has no American connection, although the Grand Trunk has. In this situation neither the Canadian Northern nor the Canadian Northern Ontario, nor the Canadian Northern Quebec has (any American Atlantic seaport..


Thomas Simpson Sproule: But they may have in the future.


George Perry Graham: That may possibly be. But the agreement that may be entered Mr. GRAHAM
into, based upon this resolution, provides for the Canadian Northern and the Canadian Northern Ontario, and it also covers the business to be done by the branch lines and connections. So, every interest identified with the Canadian Northern is bound up in the agreement that will be made on this resolution. I agree largely with the leader of the opposition, having had some experience with railroads. If they start out not to keep an agreement, I do not think all the penalties you can put on these pages would prevent them from evading to some extent-I mean as to traffic.


Robert Laird Borden: Routing?


George Perry Graham: Yes. We come to an outline in the agreement of what they agree to do, and I think that under the condition that would probably arise under this contract they will be glad to keep these agreements, and there will toe a force to help them keep it, that, perhaps, does not exist in other agreements.
Now, I come to the point raised bv my hon. friend from Norfolk (Mr. McCall). The question he raises, that of leasing the Intercolonial, I am not prepared to consider I may be wrong, but at the present moment, I would not like to consider leasing or selling the Intercolonial railway. That is my personal feeling about it. But in the resolution before us there is a -provision that on demand, of the government the Canadian Northern railway shall enter into an agreement for the interchange of traffic at Montreal with the Intercolonial. That is a feature of this agreement which strikes me is of great benefit to the state-owned railway. It was asked to-day why that agreement was not placed in the resolution and proceeded with at once. I will explain the isituation again, as I did this afternoon. There is at present an agreement for interchange of traffic at Montreal between the Grand Trunk and- the Intercolonial for the term of ninety-nine years. That agreement may be terminated on notice being given by the government, but the company has no power on its side to terminate the agreement. It may be that, in a short time, the Grand Trunk will suggest-in fact, I can go further and say that the Grand Trunk is now suggesting it, and will, no doubt, continue to suggest more strongly when the Grand Trunk Pacific i-s completed-that, in the interests of the through traffic and the road, we ought to release them from a portion at least of that arrangement. I do not think for a moment the government will agree to do that, it will not at present at least. But, before this road is constructed, or at that, time, -conditions -may arise under which it would be in the interest of the Intercolonial, and of the people, so far as transportation is concerned, that a propos-

ition of that kind might be entertained. There is a clause in this resolution under which the government, if they desire, can call for the Canadian Northern to make an agreement for full interchange of traffic at the city of Montreal, and thus the Intercolonial might become the eastern connection of this great new transcontinental road. I agree with my hon. friend that, if that condition were arrived at, and if such an agreement were made, it would be stronger than any legislation you could make in order to direct traffic to Canadian Atlantic ports.


George Eulas Foster: What are the reasons which impelled the Grand Trunk to endeavour to modify that agreement so that it might be allowed to free a portion, or all of its traffic from conditions of interchange with the Intercolonial?


George Perry Graham: The reason urged-urged very mildly at present, but as I see it, to be urged more strongly in future-is that the Grand Trunk (Pacific controlled by the same people, ought to have at least a portion if not all the traffic that the Grand Trunk gathers up in Ontario for distribution in the maritime provinces.


George Eulas Foster: It is that the diversion is not to outside roads tout to roads through Canada?


George Perry Graham: That i3 the argument placed before me.


George Eulas Foster: They wish to give a larger portion to themselves in reality?


George Perry Graham: Yes.


George Eulas Foster: But no part of it contemplates a diversion of any of the traffic towards other than Canadian routes?


George Perry Graham: There has been no such suggestion.


Thomas Simpson Sproule: I desire to say just a word with reference to the observations of my hon. friend from Norfolk (Mr. McCall) for fear they might be taken as expressing the sentiment of the country, and showing that we were desirous of having some company take over the Intercolonial under leasing or other arrangements. So far as 1 can judge, the sentiment of the country in my part at any rate, is the very reverse of that. The country, I think, desires to hold on to the Intercolonial, believing that, properly managed, on the same principle as company railways are managed, it would toe a good asset of Canada. But there is another reason that would induce us to hold on to it, and what induced me to believe, many years ago, that it would be a very desirable thing to bring the road up the Georgian bay. In the first place, I think, that, as a government owned railway, its earning powers might be materially increased if, in making this contract, we had arranged that the Canadian Northern would direct its freight over the Intercolonial and allow interchange of freight. I think it would be better for the country if the Intercolonial were extended up to the Georgian bay. Here is one of the reasons which make me believe that we would toe unwise to part with it. Some years ago that railway was hauling freight to an extent which gives an idea of the benefit the people receive from the Intercolonial. I am now quoting from the ' Hansard ' of 1904, vol. 1, page 335. The question was asked by Mr. Kemp:	,


Mr. KEMP asked:: X. How many bushels v>f grain have been hauled by the Intercolonial railway during the six months preceding March 1, 1904, for delivery at Halifax for export?
2.	What was the proportion delivered in each month?
3.	What lake ports was it shipped from?
4.	What was the rate per bushel from such
lake ports to Halifax?	.
5.	What was the mileage of each railway over which it was hauled?
6.	What was the earnings per bushel of each railway ?
7.	What was the estimated cost per bushel for the service the Intercolonial railway performed?


Hon. JAMES SUTHERLAND (Minister of Public Works):: 1.	The number of bushels of grain hauled
by the Intercolonial railway during the six months preceding March, 1904, for delivery at Halifax for export was:	Wheat, 87,826)
bushels; corn, 59,611 bushels.
2.	Proportion delivered each month was:
Bushels.
November, wheat	 47,836
December, wheat	 23,990)
January, wheat	 16,000
February, corn	 59,611
3.	All of it was shipped from Depot Har- . bour.
4.	The rates from Depot Harbour to Halifax were:
Per bush. Cents.
16,000 bushels wheat	 5-15
21.836	"	"	
4-9039,990)	"	"	
5-4025,718) bushels corn	
4-9433.892)	"	"	
5-00
5. The mileage of each railway over which it was hauled was:
Miles.
Canada Atlantic railway	 346
Grand Trunk railway	 34
Intercolonial railway	 828
6. The earnings per bushels of each railway was:
Cents.
C.A.R. on 16,000 bushels wheat.. 2 27) G.T.R. on 16.000	"	..	60
T.C.R. on 16,000	** 2-27)
The question was asked: Was that a paying rate, and the answer was that, having regard to the return cargo, it was considered a paying Tate. I have always


thought that if we had the Intercolonial railway extended to the Georgian bay it might become a great lever to keep down the freight rates upon other roads. What would happen to the shippers if we parted with the Intercolonial? Any other railway, even the Canadian Northern railway, would seek to raise the rates up to the level of other roads, and the people would pay practically double freight Tates if the Intercolonial railway went into the hands of the Canadian Northern railway. That is to my mind an important consideration. There are two reasons why we ought to keep that road. One is that it is a very desirable lever that we can use to regulate the freight rates on other roads through the same section of country; the other is that while that road is carrying this freight at those low rates the people get the additional advantage. I have thought this matter over many times, and I think that the Intercolonial railway should be pushed as rapidly as possible, especially to the Georgian bay, where it could share in the freight coming from the west down the lakes, and so become a paying concern, which it is not to-day. I think it would be a very unwise move for the government to attempt to dispose of that road either by sale or by lease.


Alexander Haggart: The Minister of Public Works asks us for a suggestion with reference to this clause 13. They do not often ask this side of the House for suggestions. I think if they acted upon our suggestions a little oftener it would be better for the country. Now I will offer a suggestion for what it is worth. We are creating a tribunal in this clause 13 to try questions that are likely to come up. You have created a tribunal, and you have made the finding of that tribunal final with reference to other matters. Now as to the length of the road, the decision of the Governor General, it is said, shall be final. There are only two parties to the agreement, and when they do not agree let one be the sole judge, then they are both bound by his decision, even supposing the sole judge is one of the parties to the agreement.


William Pugsley: I am inclined to think that the Railway Act now provides for that. If any railway company fails to do what it has bound itself to do, the party injured may apply to the board for an order compelling a company to carry out its obligation.


George Eulas Foster: Does that hold with reference to agreements between railways or between a railway and a shipper?


William Pugsley: To agreements between railways, I think.


Thomas Simpson Sproule: 


George Eulas Foster: If one railway made a bargain with another railway, the commission could step in and compel them to fulfil it?


William Pugsley: I think so, I think that is in the law. What I think will be the most effective remedy is this: All railway companies are greatly influenced by public opinion. At the present time, and I presume it will be so for many years to come, the Transcontinental railroads will be constantly coming to parliament for favours of different kinds, coming for steamship subsidies, for railway subsidies in connection vith their branches which are to be feeders. Now if a company like the Canadian Northern railway, having with the authority of parliament, entered into a solemn obligation to transport the freight going over their road through Canadian channel's to Canadian ports at the same rate to the seaboard as is given to the United States ports, and if we found them to be wilfully violating that solemn agreement, I think that parliament would very soon deal with them.


George Eulas Foster: That would all depend upon the influence the company had with the government.


William Pugsley: A company cannot influence public opinion.


George Eulas Foster: I think the Minister of Public Works is better at making theories than he is in carrying them out. We had a good instance of that in the case of the Grand Trunk Tailway. The Grand Trunk is as amenable to public opinion as any other railway company. It made a solemn agreement with the Intercolonial railway to interchange freight at Montreal at certain rates, and on certain conditions, but the pen was not put to the agreement before the Grand Trunk proceeded simply not to carry it out, and they did not carry it out, but violated it straight. Now, I would like to know just what was the question that the Railway Commission decided as to that interchange of traffic. I would like the minister to give us the basis of the question that was submitted, and the decision that was made upon it.


George Perry Graham: I think I laid on the table two weeks ago the synopsis of the agreement with reference to the arbitration. It was not the railway commission that gave the decision, but the board of arbitrators-I used the word commission. The question was whether they would give us the traffic at Montreal or carry it down to certain points on their own line and then hand it to us. We contended that the substance of the agreement was that Montreal was the junction point and that the

traffic should be handed to us there, and the board of arbitration upheld our contention.


George Eulas Foster: That makes my point still stronger, that public opinion has no effect on the Grand Trunk. From 1898, when the agreement was made, down to the present time they have violated that agreement.


George Perry Graham: They are not violating it now. It is fair to the Grand Trunk to say that eminent counsel on their behalf construed the agreement as they did, and advised them to that effect. Our counsel had other views, and the views of our counsel prevailed before the arbitrators.


George Eulas Foster: Then we have nothing to hope for from the railway commission in this matter. The Canadian Northern can violate that agreement if it pleases, and the railway commission will have no authority to compel it to carry it out.


George Perry Graham: It is a question of law on which I am not prepared to give an opinion.


George Eulas Foster: So far we. have no action or precedent as to what that commission would do or would not do, because they have not ruled on a question of that kind.


George Perry Graham: The railway commission has no power to deal with the Intercolonial railway. It might have power to deal with a company, and still not have power to deal with an arrangement between a company and the Intercolonial railway.


George Eulas Foster: Then it is still more powerless with reference to this.


Thomas Simpson Sproule: What power would they have to punish?


George Perry Graham: As the leader of the opposition pointed out, and I agree with him, no penalty that you could apply could help out. These companies make agreements, and the board of railway commissioners can enforce the agreements they make; but I am not going so far as to say that they could enforce an agreement in this case that they shall route their freight by Canadian ports. That is a question of law on which I am not prepared to give an opinion. There is something that will compel them to do that which to my mind is stronger than any penalty you could impose. In the first place, they could not take their traffic to an American port at an advantage to themselves. They must always give the Canadian port as good a rate as the American port. Then, they will get the long haul to Montreal, and it is to their advantage to take the traffic to Montreal. A corollary to that is that if the agreement is made with the Intercolonial railway, it will be to their interest to give us the traffic, and it will be to our interest
to get it, because we will hand over to that road the westbound traffic that comes through Canadian ports. I do not think, if you covered the statute with pages of penalties, they would help you out in enforcing a routeing arrangement.


Mr. PORTER.: I did not very clearly gather the manner in which the Canadian Northern might possibly benefit by routeing the traffic originating on its line by way of an American port. As I understand the situation, it is this. The Canadian Northern railway undertake by this agreement that all freight originating upon its line will be routed to a Canadian port; that is, they will not use any endeavour to divert it, but they will use every endeavour to take it to a Canadian port, and in doing that they will not charge a greater rate for delivering it at that port than the rate at which the same freight could be delivered at an American port. Taking these two things as granted, I do not see clearly how the Canadian Northern or any other railway under such an arrangement could make it an object to divert the traffic. Perhaps the minister will enlighten me as to some way in which a railway operating under such an agreement as this could evade the provisions of that agreement, and. get some extra freight rate out of the freight that originated on their line and was diverted to an American port.


George Perry Graham: Under the law of rebates on both sides of the line, there would be no object at all in the Canadian Northern or any of its connections sending the traffic to an American port. It could not make any greater profit.


George Eulas Foster: Why, then, does the Grand Trunk do it?


George Perry Graham: The Grand Trunk has interests in other lines.


George Eulas Foster: Could not this company have interests in other lines?


George Perry Graham: It has no interest at the present time.


Mr. BARKER.: The other company could give the interest by a division of the rates.


George Perry Graham: It is contrary to the law both in the United States and in Canada for a company to give an undue division of rates, and the Interstate Commerce Commission of the United States and the Railway Commission of Canada have power to make the division of rates between the two companies.


Robert Laird Borden: Suppose there is the same rate, let us say, from Regina to Halifax or St. John that there is to Boston or Portland; is there anything to

prevent the Canadian Northern getting a larger share out of that total rate if the freight goes to Boston or .Portland than if it goes to Halifax?


George Perry Graham: Yes. It is against the law of both countries. There is a basis on which that division is made where the traffic passes over more than one line, and the Interstate Commerce Commission of the United States and the Board of Railway Commissioners for Canada would say what proportion of the rate should go to each company for the mileage haul.


Robert Laird Borden: Is there any law of the United States or of Canada which says that a company hauling freight 200 miles shall get just as much as a company hauling it 800 miles?


George Perry Graham: No.
Mr. BORDEN {Halifax). That is exactly what I am pointing out. Take Regina to Boston and Regina to Halifax via Montreal, the Intercolonial railway will have to haul 840 miles to Halifax, and some other railway with which the Canadian Northern may have connection, would have to haul it six hundred miles less; I do not believe there is any law in the United States or in Canada which says that a company hauling traffic 240 miles shall get as much as the Intercolonial hauling it 840 miles.


George Perry Graham: I see the point.


Robert Laird Borden: Does it not follow that the Canadian Northern railway could make a better bargain with a road that has only the 240 mile haul, and, therefore, if it was its interest to send traffic to Boston it would be sent- there?


George Perry Graham: It could not make that arrangement if it had a traffic agreement with the Intercolonial railway to give the Intercolonial railway the traffic.


Adam Brown Crosby: Could that agreement be made now?


George Perry Graham: It could not possibly be made now.


Robert Laird Borden: The Boston road would have its agents out in the Northwest getting people to route their freight to Boston, and the Canadian Northern railway, while not directly connected with any such effort, would look on with a great deal of approval, because it would be getting a great deal more money out of it if the traffic went to Boston or Portland rather than Halifax or St. John. We discussed at all that in the case of the Grand Trunk Pacific agreement. In the Grand Trunk case it 'was perfectly plain, because the Grand Trunk had terminals at Portland, and it would be a far shorter haul than to Halifax and St. John, and its interest was Mr. BORDEN (Halifax)
perfectly obvious in that case. Exactly the same conditions could be created here provided the Canadian Northern railway made some arrangement with a road having terminals at Boston or at Portland. I have not the slightest doubt but that Portland and Boston and, perhaps, some other United States ports, are at the Canadian Northern railway to-day with a view to having this traffic routed in their direction, because the American roads and the American ports are very keen about such matters and they look a long way ahead.


Edward Guss Porter: The minister practically admits that such an arrangement is possible between railway companies, and that being so could not this agreement be so drafted as to prevent such a condition arising? If the Canadian Northern railway were prohibited from entering into an arrangement with any other company by which it would secure a greater share of the freight rate than it would by carrying it to a Canadian port, would not that bring about the object that this section has in view? Is it not possible to do that?


George Perry Graham: It may be possible on paper, but it would have no practical result.


Edward Guss Porter: It would have no less practical result than this clause has.


George Perry Graham: I do not think it would have any more. The question of routeing is so intricate that it is difficult to make a law that can control it absolutely. I look more to the fact that in the future we will probably have a running arrangement or an interchange of traffic arrangement in which it will be the business of the government to see that they get a large share of this traffic. If the Canadian Northern were going to divert in any direction it will in all probability take the long haul to the city of Quebec on its own line. I have a great deal more fear of not getting all the traffic we ought at Montreal because of the Canadian Northern using its own line for the long haul to Quebec or Levis, than I have of it going to an American road either at Boston or elsewhere. Then, the Canadian Northern is putting on a line of steamships between Canadian ports, and it will be to its interest in every respect tg>
carry traffic to and from its own steamships. I have studied the different phases of it, and after full consideration, and three or four months' discussion, I have come to the conclusion that to put a clause of this kind in as stringent as we can, would accomplish everything that anything else could. The interests of the Canadian Northern railway are bound up in the Canadian route by steamers, and having their line through to Quebec direct, the chances are all in favour of us getting a big share, if not all, of the traffic through Canadian ports.


Edward Guss Porter: When the minister states that the railway will take advantage of the long haul rather than diverting the traffic over the short haul, is he not ignoring the fact that the freight rates to the two ports of delivery are the same? If the railway gets the same amount of money for the short haul as for the long haul, they would be saving operating expenses and it would be an inducement for them to divert the traffic.


George Perry Graham: That is a very intricate question.


Samuel Barker: Surely the minister knows that it frequently pays a company, and that it is an everyday occurrence and a common sense proposition, to hand traffic over to even a rival company at a particular point rather than that the originating company should carry by the long haul. Does he not know that in the end this practice may pay both of them? The minister knows well that to talk about these agreements having any effect upon a railway company in route-ing traffic is an absolute absurdity. Any gentleman sitting behind the minister who is in the habit of shipping goods will tell him that when he goes to the station agent, if it is in the interests of the company that it should go by Portland, there will be a car for Portland and there will not be a car for Halifax. We all know that. The agent will say: If you want to ship this to Portland, we can have the car here tomorrow morning: but if you want to send it to Halifax you cannot get a car until next week. The hon. gentleman knows that as well as I do. The company can send the freight in any direction it likes practically without giving any special instructions to its local agents. If the local agent is not smart enough to know what the company wants he will he dismissed. A smart sharp agent knows just where the company's interest is, and he will provide for transportation to the point that pays his company best.


George Eulas Foster: The Canadian Northern railway at present has no terminals in Montreal, but proposes building them. Does the minister know where the proposed site of these terminals will be?


George Perry Graham: No.


George Eulas Foster: But it will not be the Grand Trunk terminal.


George Perry Graham: I think they will have separate terminals.


George Eulas Foster: My hon. friend knows of course that this contract with the Grand Trunk railway concerning the terminals of that company in Montreal runs for ninety-nine years.


George Perry Graham: Yes.


George Eulas Foster: He contributes to them so much according to the terms. If he now proposes to have exchanges with the Canadian Northern railway, he will also have to arrange for terminals with that company, and will be put to similar expense. Has the minister thought about what that would cost, and is that the reason why he has not made arrangements for an interchange wi'th the Canadian Northern railway? He could not make the interchange without having terminal facilities.


George Perry Graham: I want to be sure what I am going to get in return for the Intercolonial railway before I would ask the Grand Trunk railway to consent to cancel the other arrangement for interchange of traffic. It is evident that the Grand Trunk railway will be urging for the cancellation of the arrangement, and the cancellation of the arrangement would mean its entire cancellation. I do not know that that will be done. But I place myself in a position to take every advantage if the Grand Trunk railway insists on cancelling the arrangement. We pay the Grand Trunk railway $140,000 a year rental, and we contribute a certain amount to the upkeep. If we have that arrangement annulled we would not have the double expense, but we would not make arrangements with the two companies for the same purpose. If the arrangement with the Grand Trunk railway were cancelled, we would be free to make arrangement with the Canadian Northern railway.


John Waterhouse Daniel: When the agreement goes into force with the Canadian Northern railway, the present arrangement with the Grand Trunk railway for sending its freight over the Intercolonial railway will cease. Is that what we are to understand?


George Perry Graham: It would not be in the public interest for me to say too much about this agreement at present. Conditions might arise under which an arrangement could be made with the Grand Trunk railway, and we would handle part of their traffic, and they would handle part of ours, and also have an arrangement with the Canadian Northern railway to have their freight traffic go over the Intercolonial railway. I do not say that we could make such an arrangement with either company, but if the government found itself in the position to make just such an arrangement, the Canadian Northern railway would be compelled to make that arrangement with us.


Mr. McCALL.: The discussion for the last hour has not made it at all clear that the country is protected with regard to the delivery of freight over the Canadian Northern railway to the Intercolonial railway. This company which has such enormous

grants ought to state clearly what it is prepared to do. In every important centre the railway companies have paid solicitors canvassing for freight over their lines. Will it be asking too much to inquire from the minister what he proposes to do? If he will take us into his confidence, the country will be satisfied to have this other trunk line available for business, and to act as a feeder for the Intercolonial railway. I would again suggest that some arrangement should be come to with the Canadian Northern railway by which they would work the Intercolonial railway on some joint contract or lease it on terms satisfactory to Canada.


William Pugsley: As regards section 14, my hon. friend could not have heard the Minister of Railways. He said that the Canadian Northern railway could be obliged to come into an arrangement at once, but that the government has now a binding agreement for ninety-nine years with the Grand Trunk railway. That agreement is mutual. Under it all the unrouted Intercolonial railway traffic bound westward must be delivered to the Grand Trunk railway at Montreal. And the Grand Trunk railway must send its unrouted traffic for the maritime provinces over the Intercolonial railway. Involved in that agreement is also an obligation on the part of the Intercolonial railway to pay a rental for the use of certain terminals in Montreal. What would be the result if parliament were by resolution to tie the hands of the Minister of Railways absolutely and definitely by providing that there shall be an agreement for mutual interchange of traffic between the Intercolonial Tailway, and the Canadian Northern railway? The Grand. Trunk railway would to-morrow morning say that the government is at once bound to enter into a traffic arrangement with the Canadian Northern railway. Involved in that is the delivery over by the Intercolonial railway at Montreal of all its unrouted traffic to the Canadian Northern railway.	The
Grand Trunk Tailway would say:	Mr. Graham, we have you now, we want you to cancel the agreement which you have with us, and to cancel it on our terms. Mr. Graham would say: Oh, it would not be in the interest of the country to do that. But the Grand Trunk railway would say: Parliament has bound you to do it, you must do it. Cannot the hon. gentleman see in what a disadvantageous position it would place the government through the Intercolonial railway, and in what an exceedingly advantageous position it would place the Grand Trunk railway? The Grand Trunk Railway Company is allied with the Grand Trunk Pacific Railway Company. They will have a road from Levis to Moncton completed very soon. The road is now com-Mr. McCALL.
pleted through New Brunswick from Moncton to Plaster Rock, and by next year it will be completed through to Levis. The Grand Trunk railway, being allied to the Grand Trunk Pacific, is naturally desirous of handing over to the Grand Trunk Pacific the traffic which it is now obliged to hand over to the Intercolonial railway. If you tie the hands of the Minister of Railways by making a positive obligation on his part to enter into this arrangement for an interchange of traffic with the Canadian Northern railway, you simply give the whole case of the country away to the Grand Trunk, and they would demand and could exact whatever .terms they might think in their own interest, and the government -would be absolutely powerless to refuse to cancel the agreement on the Grand Trunk's own terms.


Mr. DOHERTY.: I understand that notwithstanding the stipulations in this agreement about an arrangement, the government could enter into no arrangement with the Canadian Northern for an interchange of traffic for 99 years without the consent of the Grand Trunk.


George Perry Graham: Not altogether that. The government can cancel the agreement on giving notice; the Grand Trunk cannot, but the government can on giving notice. At the present time, it is a paying traffic for both the Grand Trunk and the Intercolonial railway. To enter into an arrangement at the present moment would do what the Minister of Public Works says very largely, but if we could do that, so long as the arrangement with the Grand Trunk stands, it would be folly to make any other agreement, because we could not carry it out until we cancelled the Grand Trunk agreement. We got from the Grand Trunk this year of traffic both ways, about $1,600,. 000 and until we are in a position to say what we would get by this new arrangement, and what arrangements we could make with the Grand Trunk, and with the Canadian Northern, it would be suicidal from an Intercolonial railway standpoint to absolutely make any agreement. Leaving it as it is we have a free hand, always having it in our power to say to the Grand Trunk railway:	On notice we will
cancel the arrangement with you.


Charles Joseph Doherty: I suppose we are to take it that the Minister of Railways speaks for the government, because there seems to be an absolute contradiction between his position, and that of the Minister of Public Works, who says that to bind the Minister of Railways to enter into any arrangement with the Canadian Northern at this time would put us absolutely into the hands of the Grand Trunk Railway Company.


George Perry Graham: Would it not be notice absolutely to the Grand Trunk: We want to cancel this arrangement with you. Then the Grand Trunk railway would say: That being the case, by statute, here are our terms.


Charles Joseph Doherty: I thought the minister said the government could break the traffic arrangement at any time.


George Perry Graham: Yes, but there is another arrangement for terminals, and they are bound up together to a certain extent.


Charles Joseph Doherty: If the traffic arrangement is so bound up with the terminal arrangements that although the government could cancel the traffic arrangement on giving notice that would absolutely bring about the cancellation of the terminals arrangements, which would have to be made upon the terms of the Grand Trunk itself, it seems to me that the Minister of Public Works perhaps stated the position more accurately than the Minister of Railways. But that brings us back to the fact that we are to-day in such a position that we cannot make any arrangement with the Canadian Northern about its traffic for 99 years to come unless we get the consent of the Grand Trunk, and the Minister of Public Works seems to consider that the consent of the Grand Trunk might cost us a very considerable amount, in fact he describes the situation as being that if we tried to make an arrangement to-day with the Canadian Northern we would be putting ourselves in the hands! of the Grand Trunk.


George Perry Graham: My hon. friend will see that you cannot make a bargain for the delivery of the same goods with two people at the same time.


Adam Brown Crosby: I have listened to the discussion of how the freight on this new road would be taken to the ocean ports in the east. We have listened to that on many occasions. We in the east have heard much talk of this kind. Our great hope was when the Canadian Pacific railway was being constructed. In Nova Scotia, and particularly in Halifax, we had every reason to believe that the construction of the Canadian Pacific railway was going to be a great boon to eastern Canada, that we were going to be assisted to a large extent by the traffic brought from the west through Canada to the ports in Nova Scotia. Later on we discovered that while Nova Scotia had given perhaps the strongest support and assistance of any province to the Canadian Pacific railway, nevertheless when that railroad was constructed it did not touch Nova Scotia at all. Every city and community touched by the Canadian Pacific railway has benefited and prospered, in fact that road has largely made Canada, yet it did not touch Nova Scotia. When the Grand Trunk Pacific scheme was formulated, and ratified by this parliament we were told in Nova Scotia m the election of 1904 that the whole question of transportation was solved, that the province of Nova Scotia was now to come into its own. We were told by no less a man than the Minister of Finance, and by other men contesting seats in Nova Scotia that within two years from 1904 we would have the Grand Trunk Pacific connected with the port of Halifax, and I have no doubt that in the province of New Brunswick they were promised that they would also be connected with the Grand Trunk Pacific. He said that in two years we would have a double track on the Intercolonial railway, and the Grand Trunk Pacific running into Halifax. In fact, he said it would go to Country Harbour, a harbour in Nova Scotia that is noted for its excellence, and one where a great deal of traffic could be carried on. Now we find the Grand Trunk Pacific being constructed to the town of Moncton, and no intimation of any kind that it is to run into the province of Nova Scotia. I must say that, so far as I have met public men, I have never met one who could equal the Minister of Railways in the plausible movement of the hand, the genial smile, and the pleasant word. I remember the first time I had the pleasure of hearing him I thought him one of the nicest men I had ever come across. And so he is, if there is anything behind his words


An hon. MEMBER.: Have you changed your mind?


Adam Brown Crosby: He forced me to change my mind. Any one who makes statements and does not carry them out forces an honest man to change his mind about him.


George Perry Graham: Will the hon. gentleman give any statement that I made, and that I did not carry out, thus forcing him to change his mind?


Adam Brown Crosby: The hon. gentleman then, as to-night, intimated many things that meant nothing. He tries to give the House and the public the impression that he is going to have the traffic come down to Montreal over the Canadian Northern and then that it is to go over the Intercolonial to St. John and Halifax. He knows in his own heart that he is so tied up that he could not give them a running right over the Intercolonial. His contract with the Grand Trunk prevents him from allowing the Canadian Northern to take one train load over the line.


George Perry Graham: There is nothing in the arrangement with the Grand Trunk to pre-

vent giving running rights to the Canadian Northern or any other road.


Adam Brown Crosby: Does the minister tell me that he can give thg, Canadian Northern running rights over the Intercolonial?


George Perry Graham: Yes, or any other line.


Adam Brown Crosby: The Canadian Pacific railway?


George Perry Graham: Yes.


Adam Brown Crosby: Then, why does he not give it to the Canadian Pacific railway? I am very glad to get that statement from the hon. gentleman, because when he comes down to the province of Nova Scotia he will not be able to get away so easily as in the past. He has been asked by every board of trade, and especially by the board of trade of Halifax, time and time again, to give running rights to the Canadian Pacific railway over the Intercolonial. Is not that true?


George Perry Graham: It has been true.


Adam Brown Crosby: Is it not true to-day?


George Perry Graham: The proposition for running over the Intercolonial always made by the Canadian Pacific railway was that we should allow them to pick up local traffic on the Intercolonial, on behalf of the people of Canada, I have taken the ground that the local traffic of the Intercolonial could not stand to be divided with the Canadian Pacific railway. I am prepared at anv time to make an arrangement which the Canadian Pacific railway, will run their trains through to Halifax and leave our local traffic alone.


Adam Brown Crosby: Then, what position does the hon. minister take with relation to the Canadian Northern?


George Perry Graham: The same.
Mr. CROSBY'. That is what we say. that we have no way of getting a line to Halifax. But St. John is better off, having the Canadian Pacific railway, and they have benefited greatly by it. But we have the Minister of Railways rising in this House, or coming to the people of Nova Scotia, with nice words and pleasant smiles. We have been deceived right along, as we are tonight, by the statements the minister makes about the outgoing freight of the Canadian Northern. We have great hopes of the Canadian Northern. It has done a great deal for us. They brought their splendid boats to Halifax last year, even without facilities to accommodate them. And no matter what railway connection you have, if. you have not the accommodation and facilities for steamer traffic the connection is not worth much. As the business of the Intercolonial is growing it is impossible for both to do the work that they must do if Mr. GRAHAM.
we are to have the western trade go through the Atlantic port of Canada. We in Halifax are not jealous of the freight going through the norts of Montreal and Quebec in summer time. The Minister of Railways asks me [DOT]what made me change my mind. On many occasions I have seen him in Halifax, and have heard people speak of him as one of the finest men they ever met. He came down two or three months ago and told us one story, but he found some difficulty in the way, and now he tells us another story. And Halifax is in the same position, so far as railway accommodation is concerned, as it was in 1903. We Nova Scotians are pleased to see the west build up and improve its railway accommodation. We rejoice when some of our people come home from the west, and tell us what great railway accommodation they have there. But is it not reasonable that Nova Scotia, which stretches out into the Atlantic as if it w7ere a wharf, put there specially by nature to facilitate the transatlantic trade of this Dominion-is it not reasonable that it should get its full share of that trade? And yet we have no better facilities there than we had 40 years ago, so far as railway accommodation is concerned. True, we have better facilities for traffic. The road has built up very good accommodation so far as the road itself is concerned. But it is impossible for any one road to handle the traffic that should come over the Intercolonial during the winter when the ports of Montreal and Quebec are closed. And there is no hope for us in Halifax or in the province of Nova Scotia by the proposition made here to-night, unless the Minister of Railways can give us something more substantial, and greater evidence of desire that the traffic of the west should come down to the Atlantic ports at least during the winter months.
The Minister of Railways says we are tied up to the Grand Trunk Pacific and to the Grand Trunk railway for 99 years. I have heard the hon. gentleman make that statement in making his railway budget speech. He has stated in this House that the Grand Trunk railway did not treat the Intercolonial as well as it expected to be treated, as well as he thought it should be treated. I thought from what he said that the Grand Trunk railway must have been sending freight to Portland instead of sending it over the Intercolonial. He did not make that statement, but I inferred as much from what he did say. Now it behooves every man from Nova Scotia to see that the port of Halifax is treated as well as the port of St. John, that it is put on the same footing as far as export traffic is concerned. But we have no effort on the part of the government to do that, although they have been appealed to time and again. The

merchants of Halifax haye come to interview the Railway Commission, and they were told that the Railway Commission had no control, and could not do anything for them. That is the way we have been ljum-bugged in the province of Nova Scotia, and particularly in Halifax. Now if the Minister of Railways and the government mean to give us fair play in this matter it is time for them to do it. Let them tell us frankly how this trade of the Canadian Northern is going to be sent down to the ocean ports. As_ soon as the Canadian Northern brings freight to Montreal, notwithstanding that they have boats at Halifax, if they can send that freight from Montreal to Portland or to Boston, 250 miles instead of 830 miles, why, they are going to do it, As the leader of the opposition has pointed out, what are they likely to do as good business men? Are they not likely to send their freight by the cheapest route? If they can send it from Montreal to Portland or Boston at a less rate than to Halifax, which is three times the distance, are they not going to send it to an American port? Are they not going to bring their boats to Portland to take the freight from that port, although they might be anxious to go to Halifax, which is a better port and a better harbour, Would it not be natural for them to take their freight to the port that it will cost them less to reach?
M;-. PUGSLEY. Would they not rather take their freight where they can meet their own steamers?


Adam Brown Crosby: The minister surely can understand that their steamers can sail to Portland as well as to Halifax. He is a keen business man, and if he had vessels that he could sail, either to Halifax or to Portland, and if he found that he could deliver his freight cheaper in Portland than in Halifax or St. John, why, of course he would bring his steamers to Portland. I say that the natural conditions will force them to do that and it will prevent us from getting any advantage out of this trade. I have spoken of the election in 1904, when Nova Scotia sent a solid Liberal delegation to support this government. Why? Because they were told by every ministerial candidate and by every ministerial campaigner who came into that province, that inside of two years the whole province would be a perfect hive of business by reason of the Grand Trunk Pacific. But in 1908 things were entirely different, the bright promises that had been made were not fulfilled, and there is to-day no sign of anything of the kind. We have that promise repeated to induce us to support the resolution that is before us to-night, but all we know is that we are tied up to the Grand Trunk railway and cannot do anything to help ourselves, we cannot do anything with
the Canadian Northern railway, we cannot do anything with anybody. There is no pretense of an intention on the part of the government to double track the Intercolonial railway. I am glad to see they are putting a little money in the estimates for facilities at Halifax.


William Pugsley: How much does the hon. gentleman call a little money?


Adam Brown Crosby: Not quite as much as you put in Courtenay bay.


William Pugsley: $600,000 more?


Adam Brown Crosby: If the hon. minister added up all the sums he has spent in Courtenay bay during the last three or four years, it would almost purchase a province. This may be larger than some of the individual 6ums.


William Pugsley: $600,000 is not a bad amount to start with in Halifax harbour.


Adam Brown Crosby: 
Adam Brown Crosby: There is one thing I can say, and that is that I have some independence in this parliament. I am not like the hon. member for Guysborough (Mr. Sinclair), I am not prepared to swallow everything that is brought here. So far as I am concerned, I am pleased indeed to see the Dominion of Canada giving the west so much accommodation, but what I say is that the province of Nova Scotia has not benefited from all that up to the present time. I would like to hear what my hon. friend has to say about the way in which Nova Scotia has been treated, including Country Harbour that he talks so much about when he goes to Guysborough. There are some intimations now that something is going to be done, because a provincial election is coming on in Nova Scotia, but so far as my hon. friend is concerned, he has taken no action. If I had the power he has in this House, or the influence he has with the government, I wculd get something put into this Bill that I would like.


Mr. SINCLAIR.: What wculd my hon. friend propose to put into this resolution that is not in it?


Adam Brown Crosby: I think my hon. friend was in this House when the Grand Trunk Pacific scheme was evolved.


John Howard Sinclair: Answer the question.


Adam Brown Crosby: I will answer any question the hon. gentleman wants to ask. I want to ask the hon. gentleman if he had a seat in this House when the Grand Trunk Pacific was proposed. The idea at first was to build it only from Winnipeg to the coast, but the members from the provinces of Quebec and Ontario said, we cannot put up with that, we "want it to go farther. They had force enough to get it built to Moncton, but when it got there, there was not a member to say, bring it to Nova Scotia; and my hon. friend had a seat in this House at that time.


John Howard Sinclair: I asked my hon. friend a simple question. He said that if he was on this side of the House, in the position I am in, he would make some proposal with regard to the resolution that would be of greater benefit to Nova Scotia than the proposal is as it stands. I asked him what his proposal is, and he has not answered.


Adam Brown Crosby: I would have it arranged that the Canadian Northern would have traffic rights over the Intercolonial railway to Halifax or to St. John. I have no desire to ask anything for Halifax that 1 do not ask for St. John or Country Harbour. I do not care where it goes to, but I say, let us have a share of the money that is being spent. We have not had a share of it in Nova Scotia.. I ask my hon. friend from Guysborough to use his influence with the government in power to compel it or induce it to give us a fair show in the province of Nova Scotia. What is good for Halifax is good for the whole of Nova Scotia or any port in his constituency. I am not here to stand particularly for Halifax, but I stand for Nova Scotia. My hon. friend has not raised his voice to say anything. As far as we have any information in this resolution, the traffic over the Canadian Northern, when it comes east, stops at Montreal. My hon. friend is a professional man, a man of some experience in this parliament and before he came here, and if his experience is worth anything, he ought to be able to suggest some way in which that freight should be carried to the east. There is not in this resolution the slightest hope for us except in the fact that Mackenzie and Mann have to do with it, and they have treated us fairly well as far as they have gone. Although this resolution says that the traffic shall be carried through Canadian ports except when it is specially routed, there is no way provided for getting it down to the east. I challenge the Minister of Railways to show how it can be taken from Montreal Mr. SINCLAIR.
to the province of Nova Scotia or the province of New Brunswick during the winter months when the navigation on the St. Lawrence is closed. He has made no arrangement whatever. It would have been only fair to the maritime provinces that he should have made that a part of his arrangement, even if it involved the construction of a new road or the extension of the Grand Trunk Pacific to the city of Halifax the city of St. John, or the double tracking of the Intercolonial railway from Moneton to Halifax to St. John, or, if you will, making a connection from Moncton to Country Harbour. I am not jealous of my hon. friend having a good harbour there, but I am jealous about the maritime provinces getting a share of the traffic that comes from the west to the east, and therefore I say it is unfair to us that some arrangement has not been made by which the traffic should have an outlet at our Atlantic ports.


Samuel Barker: I would like to ask the minister what the object -of this agreement is, as far as the government is concerned. According to the clause, the object apparently is 'to develop commerce through Canadian ports and to afford the government system of railways in Quebec, New Brunswick, Nova Scotia and Prince Edward Island an interchange of through traffic.' Turn to clause 13, where we look to find what it is the government is going to get for this enormous guarantee that it is entering into. We find this, and it seems to me all that the government is getting:
That all freight originating on the line of the Canadian Northern Railway Company or its branches, or on the line of the Canadian Northern Ontario Railway Company or its branches, not specifically routed otherwise by the shipper, shall, when destined to points in Canada, be carried over the Canadian Northern railway or the Canadian Northern Ontario railway, or the connections of either, or over any railway within Canadian territory.
Where does the government come in? What are they getting for their guarantee? According to this, the Canadian Northern may transfer its traffic originating on its road to the Grand Trunk or 'the Canadian Pacific railway or any other railway in Canada. That comes within the letter of the agreement. Not a word saying that in consideration of this enormous guarantee, they must give it to the Intercolonial railway. What is the hon. gentleman getting for his guarantee, I would like to know?


George Perry Graham: One can see at a glance that the main object of this is to get better transportation facilities for the people of Canada. That is what we are getting for the guarantee. If the hon. gentleman living in Hamilton, had goods shipped to him from the west, Hamilton not being on

the line of the Canadian Northern, if we did not allow the company to transfer the goods to another line, how would he get them? You could not fairly compel them to hand traffic over to the intercolonial at Montreal until the Intercolonial railway is prepared to give them something in return.


Samuel Barker: You are giving them this enormous guarantee.


George Perry Graham: That is not so much for the Canadian Northern railway as for the benefit of the people of Canada. When the Canadian Pacific railway bargain was made there was no arrangement to hand traffic over to the Intercolonial railway anywhere, and when the Grand Trunk Pacific bargain was made it was thought to be in the public interest, and there was no bargain about the Intercolonial railway traffic.


Samuel Barker: The opposition did its best to get it.


George Perry Graham: The arrangement with the Intercolonial railway is incidental, and if we can carry it out it will be of great benefit to every person concerned. There is at present an arrangement with the Grand Trunk, and we cannot make the same arrangement for the delivery of the same goods to two companies at the same time.


Adam Brown Crosby: That means the Canadian Northern cannot come down east at all.


George Perry Graham: It does not mean anything of the kind. The one cent per 100 pounds discrimination is part of an arrangement with the Grand Trunk, which if this arrangement goes through in its entirety and we are able to do something I have in my mind, but which it is not in the public interest to discuss in detail, would be one of the things that would be abrogated.


Adam Brown Crosby: Will you abrogate it?


George Perry Graham: A minister has some responsibility that my hon. friend (Mr. Crosby) may understand some time, but it will be some time. I am in correspondence with the Grand Trunk over that very matter, but the president is in the old country, and the matter will be referred to him when he returns.


Samuel Barker: And the result is that for all this enormous guarantee you may never get one pound of traffic over the Intercolonial railway.
On section 14,


George Perry Graham: The leader of the opposition made a suggestion this afternoon which to my mind is very valuable. He suggested that if default were made, and the line has to be taken over, it would not 280
be much use unless the terminals at Montreal and Port Arthur were available. The Board of Railway Commissioners has now the power to grant one railway the right to use the property of another on a case being made out, but the board would probably refuse if a rival company asked to use the terminals of another company, and thus injure its business. I suggest that the following additional clause be added-.
That in the event of default and of the consequent acquisition by the government or by any railway company other than the company of the line hereby aided, neither the company nor the Canadian Northern Railway Company will oppose any application to the Board of Railway Commissioners for Canada for an order providing for the use by the government, or by such other railway company, of terminals at Port Arthur or Montreal owned or controlled by the company or by the Canadian Northern Railway Company, in so far as such use is reasonably necessary in connection with the operation of the said aided line, and on reasonable terms and compensation established by the said board.


Morley Currie: Is this road going to have a physical connection with the Intercolonial railway at Montreal, and is there anything in the present agreement between the Intercolonial railway and the Grand Trunk railway which would prevent a similar agreement being made with the Canadian Northern railway?


George Perry Graham: I am afraid I will have to spread the explanation on the pages of ' Hansard ' again.


Morley Currie: I have listened to you explain it several times, and I cannot catch on. You seem to try to give the impression that the Grand Trunk and the Grand Trunk Pacific are one and the same road.


George Perry Graham: I did not try to give that impression. At present we have an arrangement with the Grand Trunk by which the Intercolonial railway is to hand its traffic over to the Grand Trunk, and the Grand Trunk hands its traffic for the maritime provinces over to the Intercolonial railway. To make an agreement with the Canadian Northern we would have to give a quid pro quo to the Canadian Northern railway in traffic for traffic. Our arrangement with the Grand Trunk would .prohibit that because we cannot deliver the same traffic to the two roads at the same time. That arrangement may possibly, a little later, be either annulled altogether by agreement, or it might be changed so that we can make a partial traffic arrangement with the Canadian Northern. But, as I pointed out before, the Grand Trunk and the Grand Trunk Pacific having identical interests, there will be strong urgency brought upon the government to abrogate that agreement



altogether. I do not know whether we can come to an arangement to have it done, but I am inclined to think it can be done a little later, and I want to be in a position with a perfectly free hand to be able to make interchange of traffic with the Canadian Northern on all their through business on terms which will be agreeable to us both.


Morley Currie: That does not quite answer the question. The Grand Trunk business arises in Ontario territory, which is not at present touched by the Canadian Northern. I see no reason why an agreement should not be made between the Canadian Northern railway and the Intercolonial railway for an exchange of western traffc, by which the Intercolonial railway will receive a certain amount of the eastbound traffic.


George Perry Graham: And the Grand. Trunk railway can claim, by agreement, the westbound' traffic, and further the Canadian Northern railway will shortly 'have numerous ramifications in the province of Ontario as well as the Grand Trunk railway.


Morley Currie: We have made vast expenditures on the Intercolonial railway and a portion of that road which should be made to flourish, the extreme terminal at Halifax is neglected.


George Perry Graham: We do not agree with that.


Morley Currie: Anybody who has been where there is a good terminal must know that the Halifax terminal is neglected. The whole policy of a privately owned railway is to develop traffic at its extreme ends where there are terminals, and not cut it off at one half or one quarter of the way. The Intercolonial railway is well managed as regards its physical character, but no effort is made to send the traffic from one end of the road to the other. Contrast that policy with the policy of the Grand Trunk railway. The line from Midland to Montreal is a great deal shorter than the line from Sarnia to Montreal taking the lake and rail traffic, but the Grand Trunk railway chooses to send its traffic over the long haul. Why should not the government take its through traffic over the long haul and get a proportionate rate out of the total mileage moved. But when you tranship freight at St. John instead of sending it to Halifax, you are giving that much more money to the other railway out of the carriage to the sea, and doing that much damage to Halifax, which should be a participant and enjoy a proportion of that traffic. The Minister of Railways has a joint rate, for instance, from Sarnia to the sea. If the goods are sent over the Intercolonial railway and the Mr. GRAHAM.
Grand Trunk railway to St. John, the proportion of the rate claimed by the government will only ibe from St. John to Montreal, while if they were sent through to Habfax, even though the freight rate were just the same, the proportion which would go to* the government railway would be much greater. I have no desire to find fault with the shipping of freight at St. John, but I do not think that Halifax is receiving proper encouragement. We have large elevators there which are idle most of the year, we have every convenience for shipment and transshipment, yet a great many of the docks are idle compared with those at other places. Any one who looks up the statistics of traffic to the American ports, must come to the conclusion that instead" of the traffic via Canadian ports increasing, and that via the American ports decreasing, the Canadian freight that goes over the American roads is increasing, and the amount of freight that goes over the Canadian roads is decreasing. Last year the total value of Canadian freight shipped through the five large ports of the United States was something like $45,000,000 out of our total foreign shipments.


William Pugsley: Is the hon. gentleman aware how much of foreign goods were shipped to the port of St. John during the past winter? Is he aware that one third of the total exports of $24,000,000 shipped from the port of St. John were goods from the United States carried over Canadian railways and shipped through the port of St. John?


Morley Currie: That has nothing to do with the argument.


William Pugsley: It has a great deal.


Morley Currie: Certainly not. What is the use of shipping foreign goods over pur railways at cheap rates and sending our freight over American railways, and letting our road bear the burden of the cheap foreign traffic? The freight rate from Chicago to St. John is cheaper


William Pugsley: We should be glad in St. John to get all the American freight we can in that way.


Morley Currie: Why should not Canadian traffic go through St. John?


William Pugsley: It does.


Morley Currie: Before this resolution is through, I will produce the figures of foreign shipments at the various ports in the United States, and they will bear me out in my statement that the amount of freight shipped from these American ports has been increasing, and is a great deal larger than the amount of shipments from the port of St. John-twice as large. If St. John is so attractive why should any

goods go through Baltimore or Portland at all? It is for this House to consider whether it is advisable, considering the enormous profits arising from the carriage of our own goods, whether we should divide these profits with the American roads. There has been no attempt made bv this government to keep hold of this 'traffic yet still we are asked to adopt a new policy which will send a great deal more traffic through the American channels. Over $40,000,000 last year of the products of the farms of Canada went through these American ports, or nearly twice as much as through the port of St. John?


William Pugsley: Will the hon. gentleman give me the figures of the total American goods that went through Canadian ports last year? Take Montreal, St. John and Halifax.


Morley Currie: It is absurd for the minister to ask me to furnish him with these figures. If he has any argument to give with respect to them let him produce them. But what are the figures of foreign traffic? I challenge the hon. minister to show what they are, or to show that the shipments of American goods through Montreal are as large as the shipments of Canadian goods through Portland.	.


William Pugsley: I was merely suggesting


Morley Currie: You merely made the statement.
Mr. PUGSLEY-that if my hon. friend thought there was any great importance to be attached to the proportion of shipments of products of one country through the ports of the other, he would naturally have studied both sides of the question, and would have been able to tell us at the same time the value of American goods shipped through Canadian ports. If, for instance, we have $100,000,000 of American goods shipped through Canadian ports and $40,000,000 or $50,000,000 of Canadian goods shipped through American ports, upon the whole we would be rather getting the better of it.


Morley Currie: The hon. gentleman has a very fine line of hypothetical questions and reasons. He rushed madly into this discussion without knowing anything of the figures at all. He did not know, as a matter of fact, whether a pound of American goods was shipped through Montreal.


William Pugsley: I think I knew that.


Morley Currie: The 'large number of American cars going eastward over Canadian roads, must be the source of his information, but they go to Portland; they 280i
are largely through meat from Chicago, and he will find that the amount of American freight that passes through Montreal is less than he thinks. Will he give any information as to the amount of American freight shipped through Quebec?


William Pugsley: I do not profess to know the exact figures, but I do know the figures through St, John, and I say that it is a remarkable tribute to the ability of Canadian roads to handle western traffic, that during last winter, they have been able to draw away the large amount of over $8,000,000 worth of American goods and ship them through St. John, notwithstanding the somewhat longer haul. I know that many millions of dollars worth of American goods are shipped through Montreal. All I suggested was that, my friend having given attention to the figures, I could not conceive it possible that he would think iof the figures only on one side and not have seen the figures on the other side.


Morley Currie: The minister, as I have said, injected himself into an argument on a topic about which he knows nothing. As a minister entering on such a discussion, he should be able to furnish the House immediately with these figures. Now he confesses he has not the figures, although he imagines a large amount of American goods pass through this country. That is not at all the question. Our railroad policy should be to have not only large quantities of American goods shipped through our harbours, but also to have all the Canadian freight shipped through Canadian harbours. We will need it all, we need the money, and we find that the amount of Canadian goods shipped through Canadian harbours is increasing very materially, in fact it is a large proportion of the total foreign shipments, and I understand this amount is largely credited to our trade with the United States, and that our real trade with the United States is much less than the figures in our Blue-books show. The minister should know, and I would ask him now what method is adopted by the government to ascertain the quantity and value of foreign shipments through Canada.


William Pugsley: I have not the knowledge which, of course, the Minister of Customs would have, but my information is that on the manifests of goods which are sent to a port for shipment, it appears whether they are domestic or foreign. I know this is the case in St. John," and every season we know how many millions of Canadian goods have been shipped during the winter and how many millions of foreign.


Morley Currie: Again the minister has shown himself at sea on this

question. He does not know the method adopted by his government to ascertain this, or the value of the goods.


William Pugsley: I think I have answered.


Morley Currie: I do not think my hon. friend is capable of answering, and when it comes to a freight question, or a question of this kind, he should leave it to the Minister of Railways and the parties discussing it, because the Minister of Railways, even if he does not know the facts, generally gives an intelligent answer. Some clause should be inserted in this resolution whereby an interchange of traffic would be enforced or obtained between the Canadian Northern railway and the Intercolonial railway. Unless this is done I feel satisfied that before long the Intercolonial railway will he so starved that anybody would be glad to get rid of it while it should be the policy to encourage the Intercolonial because any one who knows anything about the history of railroads and railroad building, development and management, knows that the tendency of this age in foreign countries, is for the governments to take possession of and own and control their railways. We have France, Germany, Japan and Australia, all owning and controlling their roads. I shall not enter into a discussion of the merits of government or company ownership, but we can all recognize that it is the coming policy, and if this government is going to starve the Intercolonial railway, and especially to deprive that portion of the road between St. John and Halifax of freights, and prevent Halifax from being what it should be, the. main terminal of this road, being the end of the road, that is certainly not a policy that will benefit the Intercolonial railway. The minister has not said whether the Canadian Northern will be compelled to have even a switching or physical connection with the Intercolonial railway at Montreal. That is not in the agreement.


George Perry Graham: I cannot give any more explanations than I have given. I have exactly explained the situation at Montreal at least ten times.


Morley Currie: Cannot the minister state that the Canadian Northern railway and the Intercolonial railway will have a switching connection?


George Perry Graham: My hon. friend will understand that the Intercolonial railway has no line into Montreal. It runs over the Grand Trunk railway and has no power to make switching arrangements with the Grand Trunk.


Morley Currie: Then there is no switching connection?


Morley Currie: 


George Perry Graham: I believe there is at switching arrangement now between the Canadian Northern railway and the Grand Trunk railway at Montreal, but it is not our arrangement.
Resolutions reported, read the second time, and agieed to.
Mr. GRAHAM moved for leave to introduce Bill (No. 211) respecting aid for the construction of the Canadian Northern Ontario railway.


[Stage Direction]
Motion agreed to, and Bill read the first time.

[Stage Direction]
House in Committee of Supply.
Public Buildings-rents, repairs, heating, furniture, &c.-Rideau Hall-improvements, &c., $50,000.
William Pugsley: This amount is required to make the improvements at Rideau Hall which, after consultation with the equerry, of His Royal Highness, the Duke of Connaught, who is expected to arrive here in September to take the position of Governor General of Canada, we deem it desirable to make. These improvements consist of the removal of some of the buildings at present there, and the erecting of two cottages for the servants of His Royal Highness and a garage, and also decoration-some of the rooms are in special need of repainting and decorating, and improvements to the sewerage arrangements, His Royal Highness is particularly anxious as to the last. The chief architect, who went carefully into these questions with the representative of His Royal Highness, reported to me that $50,000 would be required for the improvements. We are anxious to get to work immediately, and get these improvements all made, if possible, before the arrival of His Royal Highness.


Robert Laird Borden: Does the minister say some portions of the buildings are to be removed?


William Pugsley: Yes, the chapel is to be removed, and I think, some of the outbuildings. I am sorry I have not the documents before me giving full details, but I had not hoped to have the item under consideration to-night. I will undertake, however, to lay the report of the chief architect on the table.


Richard Blain: Will this vote cover the total cost?


William Pugsley: Yes, that is the report of the chief architect, and after going very carefully into the matter with the representative of His Royal Highness. I may say that the Duke of Connaught sent a message to us by his representa-

tive that he was desirous that we should not go to any unnecessary expense; but it did seem as if the improvements which have been agreed to are really absolutely essential in order to give the reasonably comfortable accommodation that is required for His Eoyal Highness' household.


Robert Laird Borden: Is it not a pity that this building had not been tom down some years ago and a new building-erected?


William Pugsley: I think it is. I do not know that I speak for many when I say that. My own view is that the present Government House is not creditable to a country of the importance and wealth of Canada. Our population is rapidly increasing, and so is the wealth of our people, and I think that Government House ought to be a building of a character which would be a credit to the country, and in which the people would take a pride. The interior of Rideau Hall is pretty good; the rooms are comfortable, the accommodation is very good. But the exterior appearance of the building is not at all such as one would expect for the Government House of a country like Canada. Four years ago, when I became minister, I found in the estimates an appropriation of $100,000 for building a facade on the present building, and making very large improvements. I think that tenders had been called for, and were pending when I became minister. The lowest tender I think, approached very nearly the sum of $300,000. I thought that entirely too much money to expend upon this old building which, I thought, even after the money had been expended, would not be just what the country would' want. My own preference is for the erection of an entirely new building, and my personal view is to erect it on a different site. I would choose a site in the vicinity of Rockliffe on the high ground that overlooks the Ottawa river, and from which there is a view for twenty miles, one of the finest views, I think, to be seen any where in the world. It would be an ideal situation for a Government House. The land on-which the present' Government House stands could be sold, I believe, for something like $600,000. It has been valued by the Ottawa Improvement Commission, and their estimate is that, if laid out in building lots, it would bring, at a conservative estimate, the sum I have named. I think it would be very much better to take steps in the near future to acquire another site, and erect a building which would be not too expensive, but which would be suitable for the residence of the Governor General. However, of course, we cannot do that in time for His Royal Highness, and so it is necessary to make the expenditure for which we are now asking authority.


Mr. MARSHALL.: I quite agree with what the minister says about this building. I do not th'nk it is in keeping with the surroundings, or with the purpose for which it is maintained. It is a pity that we cannot avoid this yearly expenditure of $50,000, and sell that building and build somewhere else. Every year an estimate comes down for repairs to Rideau Hall. I think it is high time that we put an end to this expenditure and erected a .new building. I would gladly support any reasonable amount the government might ask for a new and suitable building. The present one looks more like an old barracks; it is a gloomy place, not at all such as Canada should provide for her Governors General.


Mr. REID (Grenville).: The story the minister tells us to-night is the same old story we have been hearing for the last twenty years. Every year we are asked for about $50,000 for repairs on this building. Every year we are told that something is going to be done towards a new building, but nothing is done. There has been enough money spent in repairs on that building since I have been in this House to put up a residence that would be a credit to the gentleman who occupies it and a credit to the country. I would like to know how much longer we are going to hear this story told. I do not think there is a member in this House who does not regard that, residence as a disgrace to the country. There are enough unnecessary expenditures called for in the supplementary estimates to build half a dozen residences. I do not think this item should go through unless the minister promises to do something towards a new building. The present Governor General vacates the office in a short time, and we are going to have another representative from the King, a representative of whom we shall be proud. But I think when he sees this residence he will not have a high opinion, either of Canada or of its government. As for the present building, I iJo not think the Minister of Public Works would live in it even if it were offered him free. On this side of the House we want to see the Governor General lodged in a decent residence.


Robert Laird Borden: I entirel'' agree with what my hon. friend from Grenville (Mr. Reid) has said, that money would have been saved to this country if all that has been expended in repairs for the last fifteen or twenty years had been used to put up a new building. The difficulty of the situation is that the Duke of Connaught is expected here in the latter part of September, and it is only possible to make the residence suitable for him by making further repairs on a building which should have been torn down long ago. It is not an economic way of proceeding, but I suppose under the circumstances no other

course is open. As I understand it, the Duke of Connaught has sent a representative here to obtain information with regard to that and other matters, and these repairs have been decided upon after consultation between the Duke's representative and the Minister of Public Works. I do not see how this proposed expenditure can be avoided, and I do not think there should be any objection to provide the money to make these repairs.


William Stevens Fielding: I think it would be a pity if the report should go out that Canada is not providing for His Royal Highness a decent and comfortable accommodation. It may be well to put up a new building. The old building is a piece of patchwork, an old homestead, which has been added to from time to time without any particular method, but I think all the Governors General who have occupied it will testify that the house is exceedingly comfortable. If it is not a thing of beauty it is at all events a comfortable home. With the improvements which the minister proposes to make, I am quite satisfied we will have an accommodation for the Governor General which will not be a discredit to Canada. Let us, however, keep in view either the enlargement or the construction of another building. I think we are hardly doing justice to the old building when we say that we are not giving the Duke decent accommodation.


John Dowsley Reid: I have no objection to this estimate being passed to put the building in decent shape for the Duke of Connaught. What I am complaining of is that the Minister of Public Works has been making repairs for the last twenty years which would far .more than have sufficed to put up a new building. More than that, he is wasting the money of the country in various parts, such as building canals in places where there is no water, and then he says there is not money enough to build a new residence for the Governor General. He came down here the other day with $17,000,000 in the supplementary estimates, the largest expenditure that was ever known. Why doesn't the minister put something in the estimates for a new building? The minister has no trouble in finding the money for unnecessary expenditures when an election is coming on, but he has no money with which to provide a decent residence for the Governor General. The Minister of Finance, like the Minister of Public Works, is trying to make excuses. I think if the Governor General saw that budding and went back to Eugland and described it, there would not be much more immigration from England. Now, I ask, again, when is something to be done about a new building?


William Stevens Fielding: I have no recollection of ever having spoken on the subject be-Mr. BORDEN (Halifax)
fore, but this is not the only case in which the bon. gentleman has drawn on his imagination.


Mr.   RETD@Grenville: The memory of the Minister of Finance is getting very short when it is necessary for him to clear himself- Before this session ends I will show him where it has been drawn to his attention.


William Stevens Fielding: That is not the point. I said I had no recollection of ever having spoken on the subject before. Possibly I did, but, if so, I have no recollection of it. My point was that this is not an indecent building, but a very convenient and respectable building, and Canada need not be ashamed of it. Let us not send out to the world the idea that Canada does not provide the Duke with decent accommodation.


Morley Currie: Just before the arrival of the Sheffield Choir in Ottawa, a pamphlet "was sent out containing cuts of the government houses in the various other colonies, and every member who compared the buildings there shown with the collection of shacks we have down at Rideau Hall would be ashamed of Canada. It would take only a year or two to erect a building that would be a credit to this country, and the time to commence it, if we have neglected to do it up to date, would be now. It is to be hoped that the architecture of the new government building would be a little better than that of the latest public building erected, that is the famous museum. For a long time T was puzzled to know the origin of that style of architecture. I had a hazy idea that I had seen a building like the museum before, but I could not place it until a short time ago when I saw a picture of the old ice palace that was put up in Montreal many years ago. I then recognized in the museum a replica of the old ice palace, even to the cracks in the wall; and I would not be surprised if the whole thing melted away some day. But, all jokes aside, there is no doubt that unless you make a beginning of a good building for our Governor General, and make a beginning soon, we shall not have one at all, because if our reciprocity policy is going to be in vogue in a few years, we shall have no need for a Governor General.


William Stevens Fielding: Would it not be a pity to spend so much money on the building if that is the outlook?


Morley Currie: I can quite understand my hon. friend's desire to foe economical on that score.


Richard Blain: Evidently the government are changing their policy on this question. P I understood the Minister of Public

Works correctly, he said that three or four years ago when he took office advertisements had been sent out and tenders had been received for a new building.


William Pugsley: No, for a front.


Richard Blain: Evidently then the govern

ment had decided on an expenditure of about $300,000 at that time.


William Pugsley: The government had not decided on that expenditure. The government had decided on making improvements, of which the chief architect had made a rough design, and which it was supposed could be made for about $100,000; but, after plans were prepared and tenders were called for, it was found that the cost of the work would be in the vicinity of $300,000. Then I brought the matter before my colleagues, who thought we would not be justified in going to that large expenditure to make an improvement in the present building.


Richard Blain: The government had evidently decided to make some extensive improvements on the -building. Since then thev have abandoned that policy altogether. Whatever the Minister of Finance may say, the question of providing a better building has been discussed in this House for many years, and it has been practically decided that a better building should be provided. I am very much surprised that the halting policy of the Minister of Public Works should put us in the position we are in now, though the House is practically unanimously of the opinion that a new building should be provided because of the importance of the representative coming to occupy the premises. Some censure was due to the Minister of Public Works for having failed even to look for a site for a new building when he evidently contemplated something of the kind. During the four years since then he has done nothing except spend a considerable amount every year, and now the committee is asked to vote $50,000 again, which will not be of much service if the policy of erecting a new building is carried out. The Minister of Finance defends the old building, while the Minister of Public Works condemns it. Until we get harmony in the government in this matter, I do not think the country can expect very much.


Joseph Elijah Armstrong: I have heard rumours to the effect that as soon as a Governor General leaves the premises, people, not necessarily from Ottawa, flock to the house and carry off pictures, paintings, carpets, furniture and everything else, and the incoming Governor General has to be supplied with an entirely new outfit. I understand that that has been the way in which the materials, including many things of great value, have been disposed of. I would like
to know if the minister has heard of this going on.


William Pugsley: I have not heard of any such thing, and I would be greatly surprised if there was any truth in the statement. I understand that when a new Governor General comes, it is necessary to put in some new furniture, in which case the old furniture would be sent to the place where these things are usually sold, and disposed of at public auction, and for the public benefit. But I cannot imagine for a moment that there is any truth in the rumour which my hon. friend has heard. We have a very reliable man who remains in charge in the interim between the departure and arrival of a Governor General and he would see that nothing of the kind takes place.


Joseph Elijah Armstrong: I understand it is quite a custom.


Thomas Simpson Sproule: I have heard it stated most positively more than once than when a Governor General leaves Canada parties in the House give away a large portion of the furniture to their friends as mementos, and that practically the house is pretty well cleared out. I have heard that statement made by those in a position to know.


William Pugsley: I have never heard it said by any one who knew, and I have never even heard the rumour before.


Mr. ARMSTRONG  .@: Now that the new art gallery is erected, will the minister gather in it all these valuable paintings that have been distributed around Ottawa?


William Pugsley: Some of the paintings which will ultimately go to the art gallery are in this building and possibly in some other government buildings, but I never heard that they had been distributed around Ottawa among private individuals as the hon. member's remark would imply. I would be greatly surprised if there was any truth in that statement. The hon. gentleman must be speaking from rumour for which there is not the least foundation.


Joseph Elijah Armstrong: Where are all these valuable paintings that are owned by the government?


William Pugsley: I will take occasion to ascertain.


Joseph Elijah Armstrong: Will the minister lay on the table of the House a list of the paintings and such, that have been purchased by the government and their present location?


William Pugsley: I can probably have that done, and if my hon. friend calls attention to it again, I shall be glad to give such information as is available. Let me say in justification for my own delay and perhaps

for the fact that the government have not taken action to erect a new building or to make large improvements in the present building, that the question is not free from difficulty. When I suggested a different site, I was expressing my own personal view, and not the view of the government. There are many people-'and I have no reason to doubt that some members of the government are among them-who think that the present site is admirable for a Governor General's residence. The site is very beautiful, the trees are fine, and altogether the land is capable of very great improvement. But, the building would have to be erected on the site of the old one, and it would mean that for two years there would be no residence for the Governor General, and his family.


Morley Currie: Apart from the present site, is there not sufficient room on the grounds for a new building?


William Pugsley: I do not know of any other available location on these grounds; in my opinion, the land would not lend itself to the erection of a large building on any other part of it.


Morley Currie: The famous confederation picture, portraying the fathers of confederation which used to hang in the Railway Committee room has disappeared, and nobody seems .to know where it has gone. There is a rumour that it has been sent away for the purpose of painting in the portraits of the Minister of Finance and the Minister of Public Works as fathers of confederation. Is there any foundation for that rumour?


Mr. FISHER.: That painting has been lent to the Festival of Empire in London as the representation of a very important historical event, and no addition will be made to it in any way.


Morley Currie: This item should be allowed to stand until we have information supplied us as to the total amount of money spent on Rideau Hall. There seems to be a universal opinion that action should 'be taken towards erecting a new building right away.


William Pugsley: I will get that information for the main estimates. It is very desirable this vote should be passed as quickly as possible, because there is not a day to be lost in getting these improvements ready by the time the Duke of Connaught will arrive as Governor General. We will have to keep the whole staff working right on to the very moment of his arrival to complete the work.


John Dowsley Reid: I have no objection to this item going through. The minister told us that four years ago he got Mr. PUGSLEY
out plans and asked tenders for a new building.


William Pugsley: That was for an improvement to the present building.


John Dowsley Reid: There evidently was some discussion among the members of the cabinet regarding the unsuitability of these premises, because the hon. gentleman says that some of the other ministers thought this was a suitable site, and others thought that another would be better. 1 am of the opinion that the whole trouble is that the Minister of Finance will not supply the money.


William Pugsley: He is very economical


John Dowsley Reid: He is until just before the elections and then it is surprising how elastic *his conscience becomes. Does he intend doinv anything towards getting a proper residence for the Governor General? The excuse given by the Minister of Public Works why we cannot begin another building is that in the meantime His Excellency could not use the present residence, but that excuse will prevent another building ever being erected on the present site. We might just as well start now and provide a building in another place. It is all very well for the Finance Minister to say that the present building is satisfactory. I say it is not, and I am sure the Duke of Connaught will be very much disappointed when he finds the sort of residence provided for him. If the Minister of Finance will put in an amount now to erect a new building and have it begun at once, we will agree to that. We have told him that from year to year. He has been spending $50,000 or $60,000 every year since he has been in office on the present old building-enough to supply completely new premises.


Sydney Arthur Fisher: It is not fair to saddle all the responsibility on my hon. colleague the Minister of Finance. The hon. gentleman has made some tempting offers, but I have a suspicion that he could not deliver the goods. We have not yet heard that he is leader of the party opposite, or can speak for his friends. I do not mean to say that his offer would influence us one way or the other, because if we should assume the responsibility of erecting a new building, we would take the whole of it on our own shoulders. I can bear testimony to what the Minister of Finance has said regarding His Excellency the Governor General's opinion of Rideau Hall as a residence. Several governors have declared it to be a most comfortable house, very well fitted for a vice-regal residence. The facade is not very prepossessing or grandiose, and some four years ago, when I was for a short time acting Minister of Public Works,

the suggestion was made that we might be able to improve the facilities for a better entrance. The officers of the department prepared plans and made an estimate and tenders were asked for. But the lowest tender was .so much higher than the estimate that the government decided that to spend so much money on an old house was altogether out of the question. The lowest tender involved an expenditure of some $300,000 simply on an improvement, and the government decided that that was too large an amount. That was some five or six years ago.


John Dowsley Reid: Then the hon. gentleman thought it was not a fit building, for the Governor General?


Sydney Arthur Fisher: No, I said nothing of the kind. True, suggestions have been made for the purchase of another site, and for the pulling down of the present building and the erection of a new one on the same site. The latter would put us in this position, that for two years we would be without a government house, and we preferred to make some expenditures every year or two on improvements. Just now there will be some extra expenditure in viewi of the arrival of the Duke of Connaught. This is an emergency vote to a certain extent for the purpose of carrying out improvements which are required in consequence of the approaching change. My hon. friend the leader of the opposition, has already said that he has no objection to this vote, and I do not see any reason why it should not go through. There are other votes on public works, in the discussion of which the House can get all the information with regard to Government House or other expenditures required, but I think it would be well to let this vote go through at once.


Joseph Elijah Armstrong: I would ask the minister to bring down a statement of the amount of money expended for paintings, furniture and furnishings at Rideau Hall since the government came into office, and at the same time the amount received for the disposal of similar goods. Then we will be able to see just how the matter stands.


William Pugsley: I will be glad to get that for my hon. friend.


Joseph Elijah Armstrong: He will then find I am justified in making the statements I have made. With reference to the new museum, and the national paintings I understand that they have been placed in a number of different homes merely for safe keeping in many instances, but that they have not been returned to their proper places.


William Pugsley: This is all news to me, I will make inquiries.


David Marshall: What is the nature of the improvements, is it to be an addition to the present building or to improve the building as it stands?


William Pugsley: The improvements will consist of certain painting of the building both outside and in, certain decorating of some rooms. It will include the building of a garage. There is no garage at present, and the Duke uses automobiles very extensively, and will bring a number with him to this country. It will include the building of some additional cottages for the accommodation of his servants and a thorough renewal of the sewerage arrangements in connection with Rideau Hall. It will include also the removal of the chapel erected by Lord Aberdeen, and which, by reason of additions which have been made since, is now a source of danger in case of fire. It is thought desirable to remove that chapel which is no longer used.


Clarence Jameson: To substitute the garage for the chapel?


William Pugsley: I do not think it would be called properly a substitution. There will be some new furnishings also. These matters have been gone over very carefully with Major Bulkeley, the equerry of His Royal Highness, and we have concluded that these things ought to be done and the chief architect is of the opinion that the amount asked is the least for which they could be done.


Mr. RUSSELL.: Then only a small amount of this expenditure is on the old building?


William Pugsley: Except for painting and decorating.


John Dowsley Reid: From the statement of the minister it would appear that every Governor who comes here when he sees the building complains to the government for giving him a place of this kind to occupy. The Minister of Agriculture stated that when he was acting Minister of Public Works he decided that a new building was necessary, and even went so far as to call for tenders, but that something happened. Of course the government decided that they could not afford to spend that amount of money. That is practically what the Minister of Agriculture said, that they could not afford to spend $360,000 to erect a building that would be a credit to Canada, and he decided to go on patching away, spending $50,000 a year which has been done ever since. I have no doubt that the $360,000 has been used up entirely in patchwork. That does not appear to me to be veiy good judgment. I feel that the Minister of Agriculture has confirmed my opinion about this matter, that is, that the Minister of Finance is


responsible for these works not being gone on with, because something happened and the money could not be provided. I have understood that when any minister lays an estimate before the Minister of Finance, if that minister draws his pen through it that ends it, and I suppose he must have told the Minister of Agriculture, who was Acting Minister of Public Works, that he could not possibly see his way clear to do anything towards erecting a new building or fixing up the premises for the Governor General. No doubt the present Governor has complained, as the others have done, t ut has had to submit and go through his term with the premises as they are. I venture to say that after the Duke of Connaught has been here for five years we will find the same old buildings and the same patchwork and the same promises if the Finance Minister has to decide whether the buildings are to be rebuilt or not. I am under the impression that after the general ejections the present opposition will have to decide as to the building which, the Governor General shall occupy, and I can assure the Minister of Agiricuiiure, although I am only speaking for myself, that the members on this side of the. House are generous enough to provide a proper building for the Governor General, although the government apparently are not. I believe the members who sit behind the government would be quite willing to .ioim in seeing that Canada gives to the Governor General a proper residence.


Joseph Elijah Armstrong: I wish to make a further suggestion with reference to the Art Gallery. We have many valuable paintings,
I understand, in the fire trap at the Fisheries Exhibit on O'Connor street. They should be transferred to proper quarters as early as_ possible and we ought to have a decent art gallery for the people who come to visit Ottawa.


Sydney Arthur Fisher: Every painting in the National Gallery which was in the Fisheries building, is now in the pew Museum, and has been for some weeks.


Joseph Elijah Armstrong: I was there within a very few weeks, and the removal had not been made then.


Sydney Arthur Fisher: I was there more than a month ago, and they were there then.
Ottawa Public Buildings - Governments's share of cost of pavements, sidewalks, &c., laid down by municipal authorities in front of these buildings, $9,610.80.


William Pugsley: This is to pay our proper share towards the pavements laid down by the city.


Morley Currie: Is the government prepared to pay its share of sidewalks in front of public buildings, in Mr. REID (Grenville)
other cities? We are doing it constantly in Ottawa, but I understand it is not done in other cities, especially in Toronto.


William Pugsley: We do the same in other cities in the case of a permanent pavement in front of a public building.


Alexander Haggart: For three or four years I have been trying to get something like this from the department in relation to the city of Winnipeg, but we have not seen the colour of their money yet. We get nice promises.


William Pugsley: I do not think the hon. gentleman (Mr. Haggart, Winnipeg) has been looking lately to see how the matter stood. An order in council passed some little time ago for payment of the money to the city of Winnipeg. I presume it is paid. If not, it is going through the regular course of payment.


Alexander Haggart: I got a letter a week ago, and it was not paid then.


Morley Currie: Does not the hon. member (Mr. Haggart, Winnipeg) know that it takes six months for money to go through the department?


William Stevens Fielding: There are one or two items in the way of payments of Indian annuities that it is of the utmost importance to have voted. These are matters of treaty, and we cannot explain to the Indians the rules of parliament which cause delay. One of these is an item 260. This is a group of Indian items, including the grant for annuities. But, to make the" vote of the annuities effective, we have to have the whole item. Then there is No. 264, which is in the same position. I would suggest that these might be passed witli the understanding that if there is anything to be discussed abundant opportunity shall be afforded later for the discussion.
Indians-Manitoba, Saskatchewan, Alberta, and Northwest Territories, $673,186.


Thomas Simpson Sproule: The amount for annuities in this is $170,345. The whole item is a large one and might cause some discussion and inquiry.


William Stevens Fielding: Could not we have the item passed with the understanding that there will be no limitation to the discussion of it later on?


Thomas Simpson Sproule: When the item is passed, there is no check. It is unfortunate to put us in that position.


William Stevens Fielding: The item is a large one.


Mr. OLIVER.: All that we really need is the annuity money, as $170,345, but, in order to get that, apparently, we have to ask for the whole item.


Thomas Simpson Sproule: There is usually a good deal of inquiry about these votes, and a good deal of explanation required. It is not exactly reasonable to put through a half million in this way without an inquiry as to what is proposed, or what has been done in the past. That is hardly what might be expected of parliament.


William Stevens Fielding: I had hoped the hon. gentleman (Mr. Sproule) would waive that objection, but if he presses it ~I cannot object.


Alexander Haggart: Do I understand that the annuity cannot be voted without the rest of the items?


William Stevens Fielding: As the hon. gentleman will see these items are numbered, half a dozen different amounts grouped under one item. Under the method of dealing with these items in Committee of the Whole, if only the annuity amount is passed, it will not be reported, but will stand in icommit-tee. We shall have the expression of the committee's good will, but I do not think that the Auditor General will regard the passing of the item as authority to give the money.


Alexander Haggart: Well, does the minister propose that this whole item-


William Stevens Fielding: I say that if objection is taken, I cannot press it. I think the criticism is a fair one, and I cannot object.


Morley Currie: I think the House is willing to grant the annuity money because that is money belonging to the Indians themselves.


William Stevens Fielding: I do not know how the Auditor General may view it. I think, on the whole, it will be better to take the annuity items. They will remain in committee and not be reported, but whether the Auditor General will regard that as sufficient authority for him wi'll be for him to decide.


Joseph Russell: Are all these amounts in connection with the Indian affairs?


Mr. DEPUTY SPEAKER.: Yes, they are all for the Indians.


Thomas Simpson Sproule: I do not see why there should be any such urgent hurry. We have been sitting over six months and surely this could have been foreseen and arrangements made accordingly. It seems to me that if foresight had been exercised over the business that would have been done. I do not know what time of the year the Indian annuities are paid,, but I understood it was in the fall.


Frank Oliver: The parties who pay treaty in northern Alberta have already started. The party for northern Ontario has to start in a few days, or it cannot make its dates. Generally speaking, the arrangements have to be made in time or we cannot meet the dates with the Indians. I am not urging the House to show its confidence in the government to the extent of passing this large vote but I am sure the House would rather show that confidence in the government than have a treaty broken with the Indians.


Richard Blain: This is one of the items mentioned by the Prime Minister (Sir Wilfrid Laurier) a day or two ago, and agreed to by the leader of the opposition (Mr. R. L. Borden). Of course the responsibility of securing the money and making the payments will rest with the government. The leader of the opposition stated in the House that he was quite willing the Indian annuities should pass. The opposition now are willing to carry out this agreement.


William Stevens Fielding: If the hon. gentleman is not satisfied, if he wants to pass the whole item, I will be happy to have it passed.


Morley Currie: I was present when the discussion took place. The leader of the opposition asked if that was a payment of money arising out of the treaty, and the Prime Minister said, yes. Now, there is a large item here involving, with the annuities, $250,000. If it is desirable that the money should be also voted, I think the minister should give us a general statement of what that means.


Frank Oliver: I hope the committee understands the absolute necessity of 'getting this money in order to keep faith with the Indians. While we do not wish to ask the House a large item without due consideration, we do ask that the government be allowed to keep faith with the Indians in regard to their treaty money. If only the amount for annuities is adopted, I would like it to be with the idea that, if the Auditor General does not see fit to allow the payment of the money we shall have to come back to the committee and ask for further consideration.


Thomas Simpson Sproule: It was a question whether we should vote these items in toto, or only sufficient of them to carry on the service until September. The Prime Minister said there were certain items which needed to be voted in toto, and among them was the annuities to Indians.


William Stevens Fielding: My hon. friend is correct, I move that the committee rise.
Some resolutions reported.
On motion of Mr. Fielding, House adjourned at 12.05 a.m. Friday.



Friday, May 12, 1911.