QUEBEC HARBOUR COMMISSIONERS.

[Stage Direction]
The SOLICITOR GENERAL (Hon. Charles | Fitzpatrick) moved for leave to introduce Bill (No. 157) to amend the Acts of 1899 and 1900 respecting the Quebec Harbour Commissioners. He said : This is not a matter of any particular importance. It provides merely that the authority conferred by the Act of 1899 on the Harbour Commissioners of Quebec to guarantee the interest on $200,000 at 3 per cent for twenty years, for the construction of an elevator in Quebec, shall be changed, and authority given to them to guarantee the interest on $300,000 at 2 per cent. The annual contribution of the harbour commissioners will be the same, if they are called on to pay anything at all.
Motion agreed to, and Bill read the first time.


Mr. FORTIN asked :: 1. Is the government aware of the fact that according to rule 51 of the penitentiary regulations, the deputy warden, in the absence of the warden, is required to assume the duties of the warden and exercise all the functions of that officer ?


Mr. CALVIN.: 2.	How is it that the functions of warden in the St. Vincent de Paul penitentiary are actually and have been exercised since the 17th February last by the inspector of penitentiaries ?
3.	Is it to the knowledge of the government that the said inspector of penitentiaries is absent from said penitentiary more than half of the time each day ?


The PRIME MINISTER (Rt. Hon. Sir Wilfrid Laurier) :: 1.	The government is aware of the fact.
2.	The inspector has acted for some time in that capacity at the request of the warden. When the attention of the government was called to the fact, the inspector was recalled.
3.	The government has no information on this subject.



THE SS. TYRIAN.

[Stage Direction]
Mr. BELL (Pictou)-by Mr. Sproule- asked :
1.	Has the Dominion government chartered the ss. Tyrian ? If so, from whom ?
2.	For what service ?
3.	For what period ?
4.	At what rate ?
The MINISTER OF CUSTOMS (Hon. Wm. Paterson).: The Minister of Public Works has left the following answer :-
1.	The Scotia Steamship Company, Limited, of Halifax, N.S.
2.	For cable service.
3.	For one or more calendar months.
4.	$1,G00 per calendar month.



MONUMENT TO GENERAL MONTGOMERY.

[Stage Direction]
Mr. CLARKE-by Mr. Osier-asked :
Will the government permit the erection of a monument or tablet on government property, in or near the city of Quebec, to mark the spot where he was killed or to commemorate the death of the American General, Montgomery, who with American troops unsuccessfully assailed the city of Quebec ?
The PRIME MINISTER (Rt. Hon. Sir Wilfrid Laurier).: The government has not yet considered what course it would take in such a contingency, and will wait until such application is made, if It is to be made.



BUSINESS OF THE HOUSE.

Mr. MONK.: I would like to ask a question of the right hon. Prime Minister in reference to private Bills. There are some parties interested in one of these private Bills, which can come up only this evening. A fear is entertained that the Bill, if adopted this evening, passed by this House, will be too late to go to the Senate. Is there any means by which private Bills can be taken up at an earlier stage in the proceedings?


The PRIME MINISTER.: I understand that it is not too late.


The MINISTER OF MARINE AND FISHERIES.: I suppose my hou. friend refers to the Senate Rill relating to patents?


Frederick Debartzch Monk: There is that one, and the one relating to the Southern Counties Rail-wav.


The MINISTER OF MARINE AND FISHERIES.: The patent Bill, I fancy, will not again go to the other House.


Frederick Debartzch Monk: The other Bill has not been considered by the Senate.


Mr. HUGHES (Victoria).: I would like to draw the attention of the Prime Minister to the fact that I placed a question with the Clerk two days ago which does not appear on the question paper this morning. He may remember that I showed it to him.


The PRIME MINISTER.: I am sorry, but my hon. friend knows that I am not responsible for that. I do not know who is responsible ; but if the hon. gentleman will send his question, I will answer it to-morrow.


Samuel Hughes: It was in reference to the Bill recently passed by the Ontario legislature extending its term, which many suppose is contrary to the constitution.



THIRD READING.

[Stage Direction]
Bill (No. 145) to further amend the Railway Act.-Hon. Mr. Blair.

[Stage Direction]
Bill (No. 155) further to amend the Penitentiaries Act (Rt. Hon. Sir Wilfrid Laurier), read the second time ; considered in committee, reported ; read the third time and passed.

[Stage Direction]
Bill (No. 156) to amend the Customs Tariff, 1897 (Hon. Mr. Fielding), read the second time ; considered in committee, reported ; read the third time and passed.

[Stage Direction]
The MINISTER OF INLAND REVENUE moved third reading of Bill (No. 144) to amend the Inland Revenue Act.
Mr. MACLEAN.: Is this the Bill that provides for the appointment of a Deputy Minister ?


The PRIME MINISTER.: Yes.


William Findlay Maclean: I do not see any provision in it that a title be conferred on Mr. Bernier who is described in a circular sent to the members as ' that upright and honest 183
man who deserves to be called the lion of the south.'


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

[Stage Direction]
Bill (No. 151) to amend the Act respecting the Senate and House of Commons (Rt. Hon. Sir Wilfrid Laurier), read the second time, and House went into committee thereon.
Mr. SPROULE.: I do not see any provision in this Bill regarding the rate per day at which members may draw their allowance. There should also be some better provision for regulating the attendance of members.	' >


The PRIME MINISTER.: That is a point which deserves some consideration. We have not been oblivious to that, but we have thought it proper not to deal with that this session. The only thing we were anxious about at present was to provide for the increase. But I believe that some provision will have to be made to anticipate some-I will not say evils-but some practices that ought to be put a stop to.


Mr. BORDEN (Halifax).: I am not sure but that the fine for non-attendance should be Increased, as well as the indemnity. Of course, I do not urge that that be done in connection with the present Bill, but it is a matter which the right hon. premier might keep in mind. We make a pretty liberal allowance for non-attendance when we allow a member to be absent for fifteen days. The provisions of the statute should be such as to enforce, as far as possible, the reasonable attendance of members upon their duties in the House. I do not think the amount of $1,500 is too great for a man who leaves his business and comes here and attends in a proper way to the business of the House. But I think we should use every possible safeguard so as to insure that, as far as possible, members shall attend here regularly during the session, and that they shall give their time to the service of the country during the period for which parliament is in session. I trust the right hon. gentleman will take that matter into consideration before another session and prepare some amendment to the law in that direction.


Samuel Hughes: I might also express the hope that the Prime Minister will take into consideration the fact that we are kept here four or five months every year by long-winded speeches that might well be cut down. I think it is worth while considering whether it would not be possible to offer a premium to those who attend the sittings of the House, on the ground that they must listen to so many of these speeches.


Mr. INGRAM.: And also the speeches of those who speak a hundred times a day, thus preventing others from speaking.


The MINISTER OF TRADE AND COMMERCE (Hon. -Sir Richard Cartwright).: If I might make a suggestion to my hon. friend from Victoria (Mr. Hughes), I am inclined to think that if you want to shorten the speeches and improve the debating in the House, you must abolish ' Hansard.'
Mr. -SPROULE. What I wished to draw attention to is this-and I do not know whether it is intended to change it or not. The existing law provides that the indemnity shall be $1,000 if the session continues for over thirty days. But it also provides that members may draw $7 for every day from the opening until the whole $1,000 is drawn. Is it intended to allow that to remain as it is, or to make a change in view of the additional amount of the indemnity? I do nol; say that it would be advisable to make any change in that respect; because there have been sessions when members drawing $7 a day have drawn the last of their indemnity of $1,000 before the session closed, and have then gone home about their business, regardless of whether the work of the session was finished or not, because, by remaining here, they would make it necessary to send home for money to pay their board. If the law is left as it is in this respect, there will be an advantage with the increased indemnity that, even with an unusually long session, members will hardly be able to draw their whole indemnity, and so will not be obliged to send home for money to pay their board, if they remain. At the same time, if it is to be provided that, the members may draw a larger amount per diem than $7, this should be embodied in the Act. But it is not in the resolution.


Hon. Mr. ROSS.: There -are a few speakers in -this House, such -as the premier and the leader of the opposition and a few others on both sides whose speeches will always be received with attention. But there are many speeches made in this House that are not profitable either for the House or for the country. For my own part, I never speak at length, because I feel that my own speeches are, perhaps, only third-class matter, and I do not wish to impose too much or too many times on the House.
On the Question : Shall the Bill be reported :-


Thomas Simpson Sproule: Before you report this Bill, Mr. Chairman-I do not wish to take up time, but I must -draw attention to the unusual number of cases this session in which Bills are rushed through before they are printed and in the hands of members. This establishes a bad precedent, and even though -the session might be continued a Mr. HUGHES (Victoria).
little longer, I think it would be better that that should be done rather than that this abuse should grow. We seem to have been indulging in it -this session more than usual.


The PRIME MINISTER.: The practice to which my hon. friend refers is not altogether regular, I admit. But -I do not admit that it has been indulged iu to a greater extent this session than in previous sessions. All the Bills that we have to consider that are not yet distributed are of a purely formal character. They are Bills upon which the House agrees, and are composed of only one or two clauses. If they were contentious Bills, I agree that they should not be proceeded with until every member had received them and had had time to consider them.


Samuel Hughes: There are two members who have not been here all session, having been recently elected. Do they reeeive full indemnity?


The PRIME MINISTER.: Who are they ?


Samuel Hughes: There is Ynie from Prince Edward Island and one from North Bruce.


The PRIME MINISTER.: The law provides for such cases.
Bill reported, read the third time and passed.



LEAD BOUNTIES.

[Stage Direction]
Bill (No. 152) to provide for the payment of bounties on lead refined in Canada (Hon. Mr. Fielding), read the second time, and House went into committee thereon.
Robert Laird Borden: Has this Bill been printed-are there other copies?


The MINISTER OF FINANCE.: The one in the hands of the chairman ds the only one that has been received. It is exactly in the terms of -the resolutions, except in the case of an error with regard to the date at which the bounty shall cease-an error having been made at the Table in making corrections. We are making changes, so that the bounty shall cease with the expiration of the five years. Otherwise, the Bill is exactly the same as the resolutions.
On section 7,


William Findlay Maclean: Can the minister say what a ton means in connection with the royalty on Nova Scotia coal ?


The MINISTER OF FINANCE.: I think it is 2,000 pounds, according to my recollection.
Bill reported, read the third time, and passed.



PACKING AND SALE OF STAPLE COMMODITIES.

[Stage Direction]
House proceeded to consider tlie amendments made by the Senate to Bill (No. 117) respecting tlie packing or sale of certain staple commodities.-(Hon. M. E. Bernier.)
The MINISTER OF INLAND REVENUE (Hon. M. E. Bernier).: I beg [DOT] to move that the House disagree with the amendment made to subsection 4 of section 7, for the reasons that the provision of this subsection fixing the date as October 1, 1900, are those of an Act passed last session, and which is now in force, and in consequence thereof the original date must be preserved. The provisions are merely a transfer from the Weights and Measures Act to a special Act.


[Stage Direction]
Motion agreed to.

The PRIME MINISTER (Rt. Hon. Sir. Wilfrid Laurier).: There is on the Order paper a Bill (No. 147) from the Senate, further to amend the North-west Territories Representation Act, which has been placed over my name by mistake. I am not responsible for it, and therefore, I move that the order be discharged.


Robert Laird Borden: The legislation contained in this Bill seems to be very desirable. I do not know whether the right hon. gentleman has looked over the Bill, or considered it. I brought the matter to the attention of the Solicitor General when the amendments to the Elections Act were going through the House, and I understood that he was of opinion that an amendment of that kind was desirable, but he did not think it well to introduce it as an amendment to the Act which was then going through the House. He thought it would be desirable rather that it should form part, of the Bill introduced for the purpose of amending the North-west Territories Representation Act. I would, therefore, suggest that it is not desirable to drop this Bill, that the legislation is good legislation, and that the right hon. gentleman should allow the Bill to be proceeded with.


The PRIME MINISTER.: I will withdraw my motion, but I will not move considera^ tion of the Bill. I shall have to inquire of the hon. Minister of Justice whether he agrees with the views of the hon. leader of the opposition (Mr. Borden, Halifax) or not. In the meantime I will withdraw my motion.
Motion withdrawn.



SUPPLY-BOND-BLAINE TREATY.

[Stage Direction]
The MINISTER OF FINANCE (Hon. W. S. Fielding) moved that the House go again into Committee of Supply.
["I think that suggestion ought to meet the approval of those opposing the Bill. It has been stated here that the words ' except steam ' were placed in the Bill by the Railway Committee, but that cannot be correct, for I find that the words are included in the Bill as originally introduced by Mr. Carroll. The Bill was objected to because no notice was given as to these powers, and, therefore, those opposed to them could not be heard. Now that the objections have been removed, I, for one. see no reason, why the Bill should not pass.\nBill reported, read the third time, and passed."]
Mr. C. E. KAULBACH (Lunenburg).: I desire to bring to the notice of the right hon. the leader, and his colleagues in the government, a matter of very vital importance to Canada bordering on the Atlantic, and to Nova Scotia in particular. I refer to the proposed ' Bond-Blaine ' treaty, as it is called, mention of which was made last evening by the hon. member for South Lanark by way of inquiry, followed by some cursory remarks from some few others, but as the subject is of such magnitude, and vital importance, as I said, to Canada, I feel it deserves more than a mere passing reference, and as every member of this House is an interested party, particularly those from Nova Scotia, Prince Edward Island and New Brunswick, therefore I consider that the gravity of the situation is my only apology in referring to it now, and asking for the patient hearing and indulgence of the House foil a few moments.
It Ss currently reported that Premier Bond's visit to Canada from Newfoundland some few days ago, was for the purpose of having a conference with the right hon. the leader opposite and his colleagues in the government, in connection with the proposed treaty between Newfoundland and the United States, known familiarly as the ' Bond-Blaine ' treaty, a scheme formulated about ten years ago- 1890-but which was set at rest at that, time, by the late Conservative government, whilst Sir Charles Tupper was High Commissioner for Canada in London, owing to the fact that it was discriminating unjustly against the interests of Canada-a sister colony-whose interests were identical, and should be held jointly intact as between sisters, and kept inviolate by any approaches from without, more particularly when by such treaty the United States were to receive benefits so clearly prejudicial to the fishing industry of the maritime provinces.
Mr. Bond, not satisfied with the reply he then received, based purely on the merits of the case, and considered on the most reasonable as well as equitable grounds, is now renewing the attempt, and is anxious to have it put in force, if he can get it ratified by the British government, and concurred in by Canada-which it is to be hoped hon. gentlemen opposite, as the custodian of our Canadian interests will see clearly the effect of, as not. being by any means, or in any manner in the interest of Canada, but, on the contrary, tending most seriously to our material disadvantage and injury.
It is certainly, therefore, to be hoped that the hon. leader of our government will advise the British government to discountenance such an attack upon Canada's vested rights and interests which she has enjoyed for so long a time in the waters of Newfoundland, and reciprocally Newfoundland has enjoyed in the waters of Canada-and which rights, as is generally conceded, can-

not be interfered with from without, unless Canada and Newfoundland jointly are agreed. In other words, the British government rightly will disallow any proposals in the direction contemplated by Mr. Bond, unless Canada's interests are taken into consideration at the same time, and the two colonies-Canada -and Newfoundland-jointly enter into an arrangement on co-equal terms, when it is considered to be in the interests of both to do so.
This proposed treaty divides itself into two parts, one relating to fish and the fisheries, and the other to merchandise and the products of the farmer and the manufacturer.
The first proposes to give to the United States fishing vessels the privilege of entering the waters of Newfoundland, and purchasing herring, caplin, squid, and other bait fishes at all times, and on the same terms in all respects as Newfoundland vessels.
In return the United States is to give free admission to Newfoundland dry codfish, cod oil, seal skins, herrings, salmon trout, lobsters, cod roes, tongues and sounds. This, it will be observed, is a serious loss, injury and sacrifice to Canada, when it is well known that Nova Scotia, from Cape Sable to Cape North is very largely engaged in the fishing industry, and the most of her catch in the summer season is on the Grand Banks of Newfoundland, in a class of vessels fully as able, and as well equipped as the fleet of the United States. What I, on behalf of Canada, and the fishermen of Nova Scotia, contend for, is, that Newfoundland has no right to allow the United States the privileges she proposes, seeing the great sacrifice it would be to Nova Scotia and the rest of the maritime provinces, and herself as well, if she could only see it-when she proposes to allow the United Stated by the privilege she offers to catch all the fish and fish products she wants for her own market, as well as the market abroad, thereby shutting Canadians out of the United States markets by a high wall of protection for their own fish, but actually by an over supply coming into competition with maritime province fish in the foreign markets as well. Let Canadian and Newfoundland waters be retained for Canadians and Newfoundland fishermen, and if the United States will insist upon placing a high tariff on our fish going into their market, they being deprived of the catch, they will have to pay the duty themselves, and Canada and Newfoundland will receive the benefits.
As to the clauses respecting merchandise, in which the farmer and the manufacturer are (interested. It provides that Newfoundland duties on merchandise shall not exceed on flour 25 cents a barrel, on pork li cents a pound, on bacon, hams, etc., 2} cents a pound, on Indian meal and peas 30


Charles Edwin Kaulbach: cents a barrel, on bran, Indian corn and rice 12* per cent ad valorem, on salt 20 cents a ton, on coal oil 6 cents a gallon. Then, Newfoundland is to admit free of duty, when coming from the United States, all agricultural implements and machinery imported by societies for the promotion of agriculture, and crushing mills for mining purposes, raw cotton, corn for brooms, gas engines, ploughs and harrows, reaping, raking and ploughing machines, printing presses and printing types.
With the exception of some few other articles named, such as cotton and broom corn, Canada is a competitor of the United States in the Newfoundland market, and still we are told by Mr. Bond, as an offset to our objection, that he is ' giving away no fishing concessions, and that there is nothing in the treaty that in any way discriminates against Canada.' It 5s conceded that nothing could be devised that would be more destructive to the trade and industry of Canada than a treaty of this nature, for by it one of the greatest industries and enterprises Canada is engaged in would be set at rest, and practically destroyed, that of fishing, and as a consequence our valuable fishing fleet, the pride of the maritime provinces, would cease to exist, shipyards would be closed up. Fishermen who hitherto enjoyed a calling of this sort, and obtained but a very moderate return for their toil, would have to surrender it for some other employment, and perhaps practically driven from our shores ; the merchant deprived of the fisherman's custom, the tradesman deprived of his employment, the farmer of a market for his farm products, in fact all would suffer, and in many cases, as a last alternative, would have to seek a home in the United States. The great complaint now is the want of a market for our fish since the United States lias ceded Porto Kieo and planted the Stars and Stripes on its soil-an island that gave us the principal market for our fish, but now wholly monopolized by the United States, a matter that Canada and Newfoundland can control, provided we give the United States no fishing privileges on our shores for the procuring of bait.
Nova Scotians found a difficulty this spring in securing full crews to man their vessels to prosecute the fisheries, owing to the want of a lucrative market for the fish, and the American fishing skippers feeling the United States are having the control of the fish market, are offering, and did offer this present spring, greater inducements to our fishermen than we could give them, and as a consequence we lost many of them, and many vessels had to sail from our ports with only part crews. But to give the United States by this proposed treaty greater concessions and privileges than she has had in the past would not only destroy the industry of fishing in the maritime pro-

vinces, but give the United States the monopoly of the fish trade in the West India islands, deprive us of the catch of fish in the summer months, and the carriage of them in our vessels in the winter season.
I fear itoo little attention is given by hon. gentlemen opposite to this all-important fishing industry whereby to guard, foster and protect our rights and interests as they should be cared for, for the benefit of Canadian fishermen and fish traders doing business with the West Indies in the shipments of fish and fish products, as well as in lumber and merchandise. My reason for making this statement is almost proverbial. It is in the memory of this House that a special appeal was made by me to the government several years ago when difficulties were presenting themselves and war was threatened between Spain and the United States, I having in view the profitable trade Nova Scotia was having at that time with Porto Rico, and a desire at the same time to retain it, that our Canadian government should communicate with the Imperial government suggesting that the United States confine her operations strictly to Cuba by way of giving that island, as she (the United States) had promised, her independence, but not to interfere with Porto Rico, as the people of that island were law-abiding and peaceable, unless Porto Rico desired separation from Spain, and then only on condition that Great Britain and her colonies would have a tariff that would offer no friction, but that one uniform trade basis as respects the trade of that island would be enjoyed by Great Britain and her colonies and the United States alike. Had this arrangement been accomplished, it would have tended greatly to our advantage as Canadians, but I doubt if any correspondence by way of an appeal in this connection was ever had. and as a consequence that island was ceded to the United States, and we have a tariff at present formulated by the United States so hostile as to be almost prohibitory.
Now, Canada and Newfoundland should be a unit on this question, and so plan, as to get even with the United States on this deal. I suggest that the United States be given no privileges in Canadian, nor in Newfoundland waters, and that the two sister colonies stand together in this respect and give no bait, but utilize it ourselves for the catch of fish, and thus become masters of our own situation, and be in a position to dictate terms, as it is very well known that if the American fishermen cannot get bait they cannot catch the fish, and we will then be in a position to supply not only the United States market with fish, but the Porto Rico market as well, and obtain any price we choose to ask, irrespective of any tariff wall they wish to set up against us.
But if we are so blind to our own interests as to allow the United States to build
vessels, man them with our own men, obtain bait from us by purchase or otherwise in British waters, catch the fish that we should catch ourselves, and supply their own market, as well as come into competition with us in the West Indies and other markets abroad, we might as well surrender all, and give up our entire fishing industry, as we would be starved out. I hope the government will grasp the force of my argument, and bitterly oppose so unjust an attempt to interfere with our fishing industry and destroy our trade generally, out of which Newfoundland should be able to see she is .receiving no material benefit herself-but striking a blow at Canada which is unnatural, to say the least of it.
Why this hostile movement on the part of Mr. Bond, as the premier of Newfoundland, I cannot understand, when Canada has ever been so favourably disposed towards her, proofs of which we have shown in a variety of instances, notably our establishing the ' Marcone ' system of telegraphy at Chateau, on- Castle Bay, at the north-east entrance to the Straits of Belle Isle. One at present at Bonne Bay to be carried to Quirpon. Lights are kept up by us-the Canadian government-on Labrador shores, at Forteau, and another at Greenly Island, with fog-horns at eacli of these stations. On the south side of the Straits of Belle Isle the Canadian government maintains four lights, viz. : Cape Bauld, Cape Norman, Flower Ledge, and Point Rich. Flower Ledge light was only recently constructed. Cape Ray, and Cape Race lights, the latter built by the English government, were recently transferred to the care of the Canadian government-and all kept up by Canada.
We in Canadian ports permit Newfoundland shipping to enter and clear upon the payment of the small entry fee of 25 cents, without even the payment of a light due, whilst Canadian shipping entering, the port of St. John, Newfoundland, are compelled to pay port charges the same as if they were foreigners. A payment is exacted even on our salt and barrels, although not taken from the ship nor landed, but used in the curing and packing of fish, and in some cases taken away from the port without being used at all. or landed as an article of merchandise, which, to my mind, appears unreasonable, and contrary to all precedent. I wish the hon. Minister of Marine and Fisheries would take note of this matter, that is, the unjust exaction of a duty on salt and barrels from our fishermen when not even landed from the ship, and ask the Newfoundland government to correct it.
Canada ranks seventh among the maritime nations of the world as regards registered tonnage of vessels, even ahead of Russia, but how long we can retain that credit will .mainly depend upon the action the Canadian government will take in this proposed appeal to the Imperial government to

have so disastrous a project crushed as this proposed Bond-Blaine treaty, so disastrous to Canada and Canadian shipping, that it' allowed will destroy our trade and shipping completely. I would draw the attention of the hon. Minister of Finance to the shipbuilding industry in Queen's, where there are seven new vessels now under construction. What would be the effect on that industry if this treaty *were allowed ? It would be shut out completely, and the ship-building of Lunenberg destroyed as well.
As to clauses 4 and 5 of the proposed treaty relating to manufacturers' and farmers' interests, I leave them to other members of this House to show the injury it is to them, to be so unfriendly discriminated against by Newfoundland in the interest of the United States. As to the vast fishing field possessed by Canada and Newfoundland, I say let us be sisters in reality and enjoy our own harvest, and not allow our neighbours to the south of us to crop it for us, and thus we will have a rich reward and control the market, which I hope Newfoundland will see.
Better still, let her come into the greal confederacy of continental British North America and become one grand whole, and thus a united and prosperous people.
In conclusion, and before resuming my seat, I repeat that I hope the government will take the most active, prompt and determined measures through the Imperial government to defeat so unjust and unreasonable a treaty as proposed, so suicidal to the best interests of Canada.



Robert Laird Borden: I trust that the right hon. gentleman and the government will take into consideration the remarks and suggestions which have been put forward so ably by my hon. friend from Lunenburg (Mr. Kaulbaeh), and take such steps as are necessary to protect the interests of this country, particularly our fishing industry, whose cause Iras been so well advocated by my hon. friend.
I do not rise, however, for the purpose of dealing with the question which has been brought to the attention of the House by my hon. friend from Lunenburg, but for the purpose of moving an amendment to the motion that you, Mr. Speaker, leave the Chair, and in that connection to say a few words with respect to the expenditure of tills country during the current year, and during the fiscal year which will end on the 30th .Tune, 1902.
In the first place, I would like to bring your attention, Sir, to the fact that what was formerly termed ' extravagant expenditure '-when the Liberal party were on this side of the House-has now received an en-entirely different appellation. The use of adjectives has undergone a marked change Mr. KAULBACH.
in the Liberal press, and in the mouths of Liberal speakers during the past five years. The words ' extravagant,' ' excessive,' * scandalous ' and other similar adjectives were freely applied to the expenditure of this country when it was many million dollars below what it is at present. But since these hon. gentlemen have obtained office, they have coined another adjective, and the word which now they commonly use to describe the expenditure of the government-when that expenditure has amounted to nearly $53,000,000 for the past year, and is to be so unusually large for the coming year-the adjective used now to describe that expenditure is the word ' generous.' That is a very remarkable change, and to a man of imagination, such as I know you are, Sir. it calls up very interesting suggestions indeed. What was formerly excessive and extravagant, is now merely generous. The revenues of the country formerly were described as having been wrung from the taxpayers. They were the property of the people of this country, and the people wTere being bled White. But the use of the word ' generous ' indicates a new order of things altogether. The government apparently, having regard to the use of this word, do not consider that they are dealing with the moneys of the country at all, but are simply showing themselves generous in the expenditure of moneys over which they have most absolute control, and to which they alone have undoubted right. It was not always so. In 1894 the hon. the Minister of Marine visited the constituency I have the honour to represent, and there described in glowing terms the hardships Whiich the taxpayers had to endure in having wrung from them so extravagant an amount as was then raised by taxes. That hon. gentleman described the position of the taxpayer in language which, I am sure, must have brought tears to the eyes of many a good Liberal who listened to him.
But during the past few years that taxation has considerably increased, and it may be well that we should bring to the attention of the House and the country the extent to which it has increased. In 1890 the people paid in customs and excise taxes $27,759,285. In 1900 they paid no less than $38,242,222, or an increase of about $10,500,000. According to the statement of the Minister of Finance, in his budget speech this year, we will probably have raised in taxes, including excise and customs, nearly $39,000,000. That gives us some food for reflection. Let us look for a moment at the total consolidated fund receipts since 1896 :
1896		 $36,618,590.72
1897		 37,829,778.40
1898		 40,555,238.03
1899		 46,741,249.54
1900		 51,029,994.02
So there can be no doubt that the revenues of this country have expanded to an enormous extent during the last four years.
.riS37

It may be said that this indicates prosperity. That we do not deny. This country has shared in the prosperity that has prevailed throughout the world, and at that We rejoice. But it is well known to every business man, I believe, that a considerable share of the increase in the receipts from customs duties is due not to larger imports, but to increase in the prices of goods. With these enormous revenues, what is the record of hon. gentlemen opposite as to the disposal of the money with which they arc entrusted. We know that in days gone by these hon. gentlemen claimed to be exponents of economy. Their remarks on that subject have been laid before the House over and over again. It is too late in the session for me to weary the House by repeating them. We all know that they said that an expenditure of $38,000,000 was $3,000,000 or .$4,000,000 too much. We all know that my hon. friend the Minister of Trade and Commerce (Hon. Sir Richard Cartwright) denounced the extravagance of the late government in terms of which he only is master. And the right lion leader of the government (lit. Hon. Sir Wilfrid Laurier) did the same thing. Nor was tile Minister of Marine and Fisheries (Hon. Sir Louis Davies) behind the other hon. gentlemen in this respect. The present Minister of Justice took up the same line. And the Postmaster General (Hon. Mr. Mulock) was even louder in his denunciation than the others.


Samuel Hughes: He was not louder than the Minister of Customs (Hon. Mr. Paterson).


Robert Laird Borden: I accept the correction of my hon. friend from North Victoria (Mr. Hughes). I should not have omitted my hon. friend the Minister of Customs. But he happened to be absent from his place for the moment, and I inadvertently passed him over, for winch I owe him my sincere apologies. He certainly was loud In manner and in language and in voice with regard to these matters in those days, though now he roars you as gently as a sucking dove when he comes to deal with these questions. The Minister of Finance (Hon. Mr. Fielding) when dealing during this session with the finances of the country during the past four years, told us that we have had in these four years surpluses aggregating $14,095,194, to be increased by an estimated surplus this year of $0,350,000, making a total surplus during these years of $20,445,194. But the remarkable part of the hon. gentleman's statement was that even for this period, which showed surpluses of $20,000,000 and upwards, the debt of the country has been increased by no less than $8,790,373. Now, how has this come about ? It has come about through a most extraordinary system of expenditure. The Liberal-Conservative party have never been backward in spending money to develop tlie country, and they have always
been ready to support this government in any reasonable expenditure for that purpose. But there is a limit in these things ; and I am inclined to think that this government have not taken into consideration certain reasons which ought to have made the public expenditure during the last three or four years less than it has been. What is the duty of the government, and what is the duty of the opposition witli regard to such questions ? In the first place, 1 believe that a good deal of this enormous expenditure is owing to the fact that the government persisted in making ante-election pledges to the people, and thereby deprived themselves of the opportunity of holding off those who make demands upon them for expenditure on public works and otherwise. I will not go fully over the estimates, but I will take merely the supplementary estimates which were brought before the House for the purpose of being voted no earlier than two days ago, the 20tli of this month. I have looked over one branch of the public estimates-public works, harbours and rivers -and I find that it embraces no less than 269 different items covering an expenditure between $1,000,000 and $2,000,000, upon which the House is asked to pass judgment. Now, I admit that any government in this country will be called upon by its political friends to make enormous expenditures for works of this kind ; and I say that the duty of the government is to cut down the demands that have been made upon them to an amount which will be reasonably consistent with the ability of (lie country to undertake these burdens, looking not only to the present, but to the future. I cannot believe that the government have offered a sufficiently firm resistance to demands of this kind made upon them. For this reason tlie expenditure for the present year exceeds $50,000,000. and that proposed for the year ending 30tli June. 1892, runs up to over $60,000,000-it exceeds the public revenues even at a time of great prosperity, when the revenues are more abundant than we can reasonably hope they will be in the future. I have pointed out the duty of the government. Now, what is the duty of the opposition with regal'd to these matters ? Is it the duty, or is it within the ability of the. opposition to go over the 269 items of that character within two or three days of prorogation and obtain from the ministers sufficient information to deal intelligently with them and to weed out from them those items which are least reasonably necessary in the interests of the country ? Suppose we had had five kundred*items, and the amount increased to double, would it have been possible at this date to obtain sufficient information to enable the opposition to do that ? The opposition, with regard to a matter of this kind, is not in the position of the government. The government has a staff of officers to report upon these matters, it has facts furnished from the local!-

ties, it has information before it that cannot possibly be in possession of the opposition unless we are to continue this session until August or September next. Therefore, we can do only one thing with regard to these estimates-we can but enter a general protest.


The MINISTER OE TRADE AND COMMERCE.: The hon. gentleman spoke just now of 269 items. Did he mean there were 269 new items or 269 items including revotes ?


Robert Laird Borden: I was not aware that any considerable number of the items to which I refer are revotes. I see here and there a few revotes.


The MINISTER OF FINANCE.: Very many.


Robert Laird Borden: Well; I think I am safe in saying that at least three-fourths are not revotes. Further than that, I would remind my hon. friend the Minister of Trade and Commerce that this House, composed as it is to a great extent of new members, is entitled to information with regard to even these.


The MINISTER OF TRADE AND COMMERCE.: Certainly.


Robert Laird Borden: From that point of view they are exactly the same as if they had not been voted before. I could understand the force of my hon. friend's argument if this were not a new parliament, if all the members who are now in the House had heard these matters dealt with and received sufficient information. That is not the case here. We have, I suppose, speaking off-hand, nearly a hundred new members in this House; therefore all these items, so far as these new members are concerned, are exactly in the same position as if they were being voted for the first time. Now, I do not conceal from myself the difficulties of the government in dealing with demands from clamorous supporters ; but what I desire to submit to the House and to the country is that the government have not been sufficiently firm in resisting this pressure, and I think they are fixing too high a rate of expenditure. Then the remarks I ventured to make the other day with regard to the date upon which the railway subsidies had been brought down to this House, are, I think, worthy of being repeated now. We had these railway subsidies brought down at a very late date in the session, we had 'them brought down without sufficient information, in fact without any information whatever being laid upon the Table of the House ; and we had them put through this House without any information being given which would enable the House to form a proper judgment with regard to these matters. It always seems to me, when my hon. friend /the Minister of Mr. BORDEN (Halifax).
Railway and Canals is dealing with matters of this kind, that to obtain information from him is like working with a probe. The information which he is able to give to the House, at all events which he is willing to give to the House, is given so grudgingly and affords so little knowledge to the House as to the special vote that is being discussed, that it is really almost a hopeless task to acquire from him the information which we ought to have with regard to such matters.
Now, I want to point out to the House another circumstance which I think should be taken into consideration by the government, and that is that the Minister of Finance himself has pointed out on three occasions during recent years, the fact that we cannot always expect such abundant revenues as we are now enjoying. I want to remind the House that in 1899 the hon. gentleman, in delivering his budget speech, said this :
But, Sir, in the midst of all this prosperity I would venture to utter a word of caution. It is said that one of my distinguished predecessors in office, at a time when trade was fairly prosperous, advised business men to clap on all sail. Far be it from me to utter that sentiment to-day. I can assure you, Sir, that I have no disposition to offer such advice as that. I would much rather, if I thought that words of mine would have any weight, utter a word of caution in the spirit of Kipling's * Lest we forget ; lest we forget.' In the midst of this great prosperity I would remind my hearers that the conditions which have brought it about cannot be expected to prevail always. It will not constantly fall to the lot of a Finance Minister to make such an agreeable statement as I have the pleasure of submitting to-day before the House of Commons of Canada. We cannot always have good crops and good prices. Conditions at home and conditions abroad may be such as to bring about a check to all this prosperity. From the experience of the past we know that the pendulum which has now for two or three years been swinging strongly in Canada's favour may soon fall back. There may soon come a time When things will not be so prosperous, and so I would to-day rather, as respects our national housekeeping and in the business world, utter a word of warning and advise our people to make a wise use of our present opportunities so that when less prosperous times come to us, as come they will, we shall be able to bear them easily.
Now, the caution which the hon. gentleman then uttered to the House was a caution, not only to the business people of the country, but it was a caution with respect to our national housekeeping. I do not see that the hon. gentleman has very much taken to heart the caution which he was good enough then to address to the people of this country. Again, in delivering his budget speech in 1900, the Minister of Finance said :
As I ventured to remark on a previous occasion, the pendulum which swings one way may swing back and it is always well that we should

keep that In mind. But so far as we can see now there is no turn of the tide.
And if I may be permitted to quote bis language uttered during the present session in his budget speech, it was as follows :
As to revenue I do not expect that we can keep on at the rate of increase which has been so marked during the past three or four years.
I th'nk we have probably now reached about the crest of the wave of prosperity. I do not expect that we shall have any serious reverses. I think the business of Canada has been developed during the past four or five years upon very safe and sound lines. I think there has been to a very large extent an absence of that inflation which is so apt to mark a period of good times.
I am of the opinion that the business of the country as a whole has been so carefully conducted and is on such a good sound basis that we are not likely to suffer any serious reverses, but I do not think it is reasonable to expect that we can go on increasing our business as rapidly as we have during the past few years. What may happen is that we might suffer a cheek.
Now, the appearance of the financial statement up to a recent date rather corroborates what the hon. gentleman then said. 1 have been looking with some attention at the returns up to the 20th day of the present month, and I find the revenue for the current year up to the 20th of May, as compared with the corresponding period of last year, shows an increase of $1,335,162. This increase is principally made up by the following items :-
Excise shows an increase of_____$434,276
Railways show an increase of.. 366,767
Dominion lands show an increase of	 397,009
Post office shows an increase of. 226,205
On the other hand the revenue from customs shows a decrease of $167,541.
Now, I do not know what the opinion of my hon. friend the Minister of Finance and of my hon. friend the Minister of Commerce may be with regard to the meaning of that indication as respects the business of this country. There is a decrease of $167,541 in customs receipts as compared with the corresponding period of last year. Does that show, in the opinion of these hon. gentlemen, that we have not only reached the crest of the wave of prosperity, but that we have commenced to go a little on the downward grade ? It seems to me that these figures may possibly bear a construction of that kind, and if so, it serves to emphasize the warning which the Minister of Finance addressed to the House and to the country when he delivered hi.s budget speech. But while the revenue for the current year up to the 20th May as compared with the same period for last year shows an increase of $1,335,162, the expenditure shows an increase of $2,883,111. The increase appears largely in the following items :
Railways	 $1,144,579
Legislation	 237,982
Public works	 1,063,618
Lighthouse and coast service.. 34,955
Fisheries	 43,754
Y ukon	 32,723
Customs	 40,259
Post office	 178,033
Now, I would like to emphasize this point to the House and the country, that while it is very easy indeed for us in a time of abundant revenue to set a high standard of expenditure, to not only expend the revenues of this country, but to run the country into debt to the tune of $8,000,000, it will not be very easy to reduce that high standard of expenditure when hard times come. I suppose it is with the country very much as it is with a man in his own private affairs. If a man sets a high standard of expenditure in his own private affairs, he finds in the future, when hard times come, that it is a very difficult thing for him to reduce the living expenses of his family. It is very difficult to cut down expenditures here and there which have been enjoyed for a great many years, and it wTill toe exactly the same with the country. This high standard of expenditure which is being fixed in this country in days of prosperity is a standard of expenditure that will toe almost forced on any government, Liberal or Conservative, which may be administering the affairs of this country when times of less prosperity come upon us. That is a thing which I think the government have not well borne in mind in dealing with the expenditure during these years, and it is a thing which I think they should have borne in mind.
Now, the hon. Minister of Finance made an argument the other day with which, taking it for the purpose for which it was delivered, I was to some extent inclined to agree. He said that in dealing with railway subsidies, it was not fair that one part of the country, after having contributed to the revenues which had produced railways in other parts of the country, should be deprived of having railways subsidized for it out of the general revenues of the country. I admit at once that there is some force in that argument, tout the hon. gentleman will see how that argument is going to apply in respect to these enormous expenditures which are now being saddled upon the country. The government have 269 items for public works. When the hard times come, as the hon. Minister of Finance says they probably will come, will not all parts of the country be as clamorous as ever for subsidies in the shape of public works, and how can any Finance Minister, whether it be the present hon. Minister of Finance or some other gentleman, meet the demands from all parts of the country, based upon the estimates now before the House ? An application for an appropriation of that kind is not very readily answered by

any government simply by pointing to the fact that the revenues of the country have become less. The clamorous political supporters of any government are not very apt to accept that as a valid excuse. When they see that enormous sums have beeu expended in different parts of the country, they are very apt to say that, whether the revenues are large, or whether they are small, they have not had fair-play in the past, and they demand it in the future.
Just one word more in regard to the policy of the government in respect to railway subsidies and public works. It seems to me that the government, in regard to railway subsidies and public works, are simply living from hand to mouth and from session to session. I say that they should have some definite policy as to the public works which should be sub sidized and which should be constructed in this country. They should act upon some definite principle, but that they have not come down with any definite principle is shown by the explanations of the minister and the meagre discussion that has taken place in regard to the estimates of the Public Works Department. So, after hearing the explanations of the minister, there does not seem to me to be any definite plan adopted by the government as to what public works shall be constructed, as to the principle upon which they shall be constructed, or as to the rule which shall be observed in respecl to the expenditure of public money in different parts of the country. That there should lie a rule seems to me to be right and wise. The same reasoning exactly applies to railway subsidies. To my mind, the government ought to come down with some definite plan in respect to railway development throughout the Dominion of Canada and in the different provinces of Canada. You would suppose that they would come down with a map showing, for instance, the railways to be constructed in Nova Scotia, and say that we judge it right and wise that the railway system of that province shall be developed upon these lines, and developing it upon these lines, we believe it is right to subsidize this particular line and make it a part of the system ; so, also, dealing with the other provinces and with the whole railway system of the country in the same way. But public works expenditures, as well as railway subsidies, seem to depend more upon political consideration than upon any plan or principle such as I am suggesting." Now, Mr. Speaker, I do not intend to occupy the time of the House further. I can only touch upon the outskirts of this subject. I can only deal with it in a very bald manner. It is too late in the session for me to attempt to do otherwise than to place these few points before the House. I therefore move :
That all the words after the word ' that ' in the motion be omitted and the following substituted therefor :


Robert Laird Borden: The total expenditure as shown by the Public Accounts during each fiscal year from 1892 to 1900, both inclusive, was as follows :-
1892		 $42,272,136.32
1893		 40,853,727.91
1894		 43,008,233.89
1895		 42,872,338.44
1896		 44,096,383.92
1897		 42,972,755.89
1898		 45,334,281.06
1899		 51,542,635.29
1900		 52,717,466.84
That the Minister of Finance estimates that the total revenue for the current year ending June 30, 1901, will be $52,750,000.
That notwithstanding this very large revenue the Minister of Finance estimates that the public debt will be increased during the current year by about $1,800,000.
That the total amounts which this House has been asked to vote during the present session, together with items of expenditure authorized by statute, are substantially as follows :-
Suppl. estimates, 1901..$ 3,729,716.90 "	1901 ..	30,000.00

Main estimates, 1902.. .$50,398,823.56 Suupl. estimates, 1902..	8,369,241.13
"	1902 .	1,240,476.18

 60,008,540.87
Railway subsidies	$ 3,462,472.00
Further ry. subsidies.. 96,000.00

 3,558,472.00


The MINISTER OF FINANCE (Hon. W. S. Fielding).: Mr. Speaker, it has become the custom of lion, gentlemen opposite, at the close or near the close of the session, to present, from their own point of view, an examiniation, or shall I say an arraignment, of the financial policy of the government. My hon. friend, the leader of the opposition, undertook that task to-day, and while we are bound to disagree with him in some respects as to Ids statement of facts, and certainly as to his inferences, I am sure we will all have to admit that, considering the large range of subjects, he dealt with the matter very briefly, and in very moderate language. I shall endeavour to follow his good example in that respect. Let me say that so far as my hon. friend's object was to utter a word of warning as to the need of moderation in our expenditure, as to the need of looking to the future, I entirely sympathize with him and welcome that word, no matter from what quarter it may come. There is always a tendency, whether in personal or in national affairs, for men in times of great prosperity to forget the future, and it is always well that some cool head should be found to call attention to the conditions of the day, to the possible change of these conditions, and to the necessity of adapting our policy, not only to things as they are, but to things as they may be at no distant day. I am always glad to find any one calling attention to that phase of onr public affairs. So strongly impressed have I been with the necessity of at all times keeping that in mind, that in the various statements which it has been my privilege to present in the form of budget speeches, at the moment when we attained the greatest prosperity, I had deemed it well to call attention to the serious view which my lion. friend (Mr. Borden, Halifax) presented to-day. and which I have presented from time to tune, as to the necessity of looking to the future. But. while I agree with my hon. friend that there should he moderation and caution, yet, I do not advise that anybody should stand still. I do not propose to say to any business man in this country, that because it is well that he should be cautious and prudent he should stand still and merely do the same amount of business that he did in less prosperous years. I feel that
every business man in Canada, engaged in large concerns, is doing more business today than he was doing a few years ago. The fact that he is doing that greater business is not to be taken as an evidence of extravagance on his part. What 1 think my hon. friend the leader of the opposition has failed to take account of is the great change which has come over the conditions of our country within a few years. When he undertakes to measure the expenditure of to-day with the expenditure of 1896, and years about that period, he should take account of the vast strides which Canada has taken in the meantime. I do not mean to say-far be it from me to presume-that the words which I have uttered from time to time, and which my hon. friend was good enough to quote, have had any material influence upon the public mind in the way of prudence or caution, though it was well I should speak them occupying my official position. But, this I may say : that the same thought has been in the minds of others who were qualified to speak, and I think we may reasonably claim, as I did in the budget speech of the present session, that the great strides which Canada has made during the past few years have been made along sound and safe lines ; that there has been, both in our public affairs and in the general business of the country, a reasonable regard to the probabilities of the future, and that as a consequence, if the time shall come, as it may have to come with all countries, that a period of activity will be followed by a period of depression, we may reasonably conclude that Canada will be found to be in a very sound condition, and able to bear the change without any very serious falling back.
I have said that I would not advise business men to cease enlarging their business ; neither would I so advise, in the national life. I have said that every great business concern in Canada is doing more business to-day than before, and that we should not regard that as an evidence of extravagance. Neither should we regard it as an evidence of extravagance in our national life if our expenditures are large-larger than they were in 1890 and the years before. We have been carrying on large operations ; we have been developing our country in many ways. If the merchant who is enlarging Iris business is justified in increasing his expenditure, surely, on the same principle, our national government will be justified in increasing its national expenditure, providing it does so for useful public purposes. We are. after all. a great business establishment, this Dominion of Canada. We are carrying on business on what we hope will be found to be sound business principles, and we are enlarging operations in all directions. Take, if you will, as one illustration, the opening of the Yukon. We have added very largely to our budget, as our public accounts

Show, by our expenditure on account of the opening up of that territory. In doing so we place ourselves in the position that hon. gentlemen opposite are able to say to the House :	See these large increases in the public expenditure. But then we call attention to the fact that on the other side of the account there is a sum larger than the expenditure; so that the enlargement of our business in the Yukon does not involve an increasing burden on the country, but is an evidence of our greater prosperity, and up to this moment has been an absolute source of profit, and not a source of expense to the Dominion treasury.
The same thing may be said, though perhaps in a lesser degree, of the Intercolonial Bailway. In the main, the large increase in the working expenses of that road, which enables my hon. friend opposite to point to the total expenditure as increasing, has been very greatly met by increased receipts. The statement for the current year is not as good a one as we would like to have. There are exceptional reasons for that; but that Is the special business of my hon. friend the Minister of Iiailways, and I shall leave that to him. But my hon. friend opposite will note the fact that if we have largely increased expenses of management on the Intercolonial, we have largely increased receipts. I mention this in order that a distinction may be drawn between an enlargement of the public expenditure which increases the burden of taxation and an enlargement of expenditure which imposes no such burden.


Robert Laird Borden: I quoted both sides of the account, showing the increased receipts as well as the increased expenditures.


The MINISTER OF FINANCE.: My hon. friend's resolution at any rate deals with the increased expenditures, and it is these that we hear most about throughout the country. Now, we are increasing business in many ways. The merchant has his own method of developing his business, and we have our method of developing our trade. At one point it is by the construction of a line of government railway; at another point it is by the subsidizing of a line of railway ; at another point it is by the construction of a telegraph line; at another point it is by the construction of a breakwater to enable the poor fishermen to carry on their business without having their boats destroyed ; at another point it is by the construction of a public wharf; at another point it is by the construction of a canal. The different sections of the Dominion have their different interests, their different industries, their different needs; and it has been the policy of the government to adopt itself to those different conditions and needs; and if this has involved a very considerable expenditure, I deny that that is any evi-Mr. FIELDING.
deuce whatever of an extravagant government. On the contrary, it may be the best evidence that a government is alive to the needs of the situation and is meeting the demands of the time.
My hon. friend seemed a little alarmed at the statement for the current year, as shown in the ten days' financial statement from which he read. He was able to call attention to the fact that the customs receipts are somewhat less than they were at the corresponding date last year. The difference is not considerable; it is, however, worthy of observation. But we shall do well if we do not magnify either the amount or the significance of it. It is well that we should remember that the rate of duty imposed on goods is lower to-day than it was at the corresponding date a year ago, and that the reduced customs receipts are to some extent but the evidence of our reduced taxation. However, if the customs receipts are somewhat smaller to-day than they were at this date a year ago, other receipts are making up for them, and, on the whole, our financial statement for the current year up to the present is very satisfactory. I am glad to say that the trade statement up to this date is no less satisfactory. I do not wish to weary the House with any details on that point; but I am sure the House will be pleased when I state that the domestic exports of Canada for the period of ten months to the end of April last year, were $127,461,000, and that in the same period of the current year they have been $144,520,000. So that with regard to that most vital feature of our country's prosperity, the showing up to the present is a very satisfactory one indeed. And notwithstanding the falling off in the receipts from customs, to which any hon. friend referred, and notwithstanding the increase in expenditures in certain classes, I am glad to be able to say that I still entertain the opinion which I expressed several mouths ago, that at the close of this financial year, on the 1st of July next, we shall find ourselves with a very handsome surplus-not so large as the one of last year, of course, but still one of the largest surpluses in the history of the country.
My toon, friend in his resolution has totalled the votes of the present session, aggregating $07,326,000, as he makes the amount. I would like to call my hon. friend's attention to the fact that a very considerable portion of these votes is for the expenditure of the current year, and should not be mixed up with the expenditure of the coming year. True, it may be said that at the end of the next year w<? shall also have supplementary estimates, and the one may balance the other. Perhaps so; but whether that be the case or not, I am afraid that the tendency of the ordinary observer, reading imy hon. friend's resolution, would be to suppose that we were proposing to expend next year some $67,000,000.

Now, there are two answers to that. In the first place, it is important to remember the difference between appropriations and expenditures. Hon. members who have been in the House for many years know much better than I have known, that there is always an important difference between the amounts voted and the amounts expended. For various reasons it is not found possible to spend all the money that is voted. There are large sums lapsing from year to year. Thus a large proportion of the money which we are voting this session, and which my hon. friend has included in his total of $67,000,000, consists of revotes of moneys which were voted a year ago. My hon. friend who performed the duty of financial critic a year ago was able to quote these large appropriations against us at that time; and now, when the money is revoted, my hon. friend has the privilege of quoting them again; so that they do duty over and over again. So with the railway subsidies. A large portion of them are revotes of former appropriations. Hon. gentlemen in previous years were able to count those appropriations against us; and since they were not expended and are now revoted, they are again counted against us. It is well, therefore, to observe the distinction between the appropriations and the expenditures, and also that the expenditures of any given year always fall very considerably short of the appropriations for the year.
Then, with regard to railway subsidies, if we put aside the question of revotes and deal only with the new subsidies, it would be exceedingly unfair to treat these as expenditures chargable to one year. Some of these will probably never be expended-not in the early future, at any rate, because, although assurances have been given to us that the roads will go on, it may happen as in the past that the companies will not be able to go on with them. In such cases the subsidies will not become actual expenditures at all; though in this instance, I am bound to say, we have tried to keep down to those which will be expended at an early day. We have scanned the list with that object in view. But this must be kept in mind, that railway subsidies granted in one year may extend over several years; and therefore, it is not fair to claim that those voted in one year are to be included in estimating our total expenditure for the year.
My hon. friend, I think, laboured under the mistake of assuming that the expenditures of Canada have been exceptionally high of late. Both in his speech and in his resolution he has referred to our high standard of expenditure; and I am sure the House will have received the impression- perhaps my hon. friend himself had the impression-that in that respect our expenditure is exceptionally high. That was the whole line of his argument. He may be surprised to learn-or at all events others will- that we have not any exceptionally high
standard of expenditure at present nor have we had any such standard in recent years. We have to consider the growth of the country since the years to which the hon. gentleman has referred. Because the expenditure to-day is larger than it was in 1896 by some millions, it does not follow that we have an exceptionally high standard of expenditure. The standard must be considered with idue regard to the growth of the country and population. Nobody imagines that the great improvements which have been made, the developments which have been carried on, could have been brought about without the expenditure of public money. The fair question, then, is whether that expenditure is reasonably keeping pace with the general growth of the country and especially the growth of population.
The total expenditure of last year on capital account and income account, on everything which could effect the debt of the country, amounted to $9.80 per head of the estimated^ population of Canada. That is somewhat larger than the usual expenditure for several years, but it is a mistake to treat it as an exceptionally high standard, as my hon. friend does. If he will turn back to the Public Accounts, he will find that in 1884, our total expenditure averaged $12.90 per head of the population against $9.80 this last year. And in case it might be thought that the year 1884 was a very exceptional year, let me point out that in 1885 the expenditure was $10.83 per head of the population, against $9.80 last year ; and in 1886 it was $13.47 per head against $9.80 in 1900. My hon. friend will no doubt reply that in those years they had to meet some very exceptional expenditures. True, they had. It was about that time that the cost of the North-west rebellion had to be paid. But we have had very exceptional expenditure to meet also since this government has been in office. In the first place, we had to pay considerable sums on old obligations of the late government. We had to pay a large sum to the province of Manitoba, arising out of a claim which did not occur in our day, but before we came into office. And if those hon. gentlemen had their own home war, which they themselves largely created, we have also had an exceptional expenditure during the past year in the very large sum we were called on to pay in order that Canada might do her duty to connection with the war of the empire in South Africa. The idea, therefore, that our expenditure has been exceptional under this administration is erroneous. True, we have spent more than the late government did in some years, but not higher than the record of the Conservative government, for during three years at least their outlay per capita was greater than ours.
In the matter of the increase in public debt, I am afraid that a reader of my hon. friends speech would assume that an ex-
/

ceptional condition of affairs liad been created. He pointed out that our public debt has increased at the rate of $1,700,000 during four years. But is that an exceptional rate of increase ? Against that increase, we may point to the fact that in the whole eighteen years of Conservative administration, the annual increase of the public debt averaged six and a half million dollars. Therefore, X cannot see that my hon. friend was right in claiming either that we had an exceptionally high standard of expenditure or an exceptional increase of the public debt, unless indeed-and in that respect I admit it is exceptional-it is exceptional to have been able to carry on such large public works as we have been building, with such a small addition to the public debt.
My hon. friend, the leader of the opposition, expresses surprise that there should be any increase in the public debt at a time when we had a surplus of several millions. If he is really surprised at that, he will have to extend his surprise to nearly all the years of Conservative administration, because in may of their years they claimed surpluses over the ordinary expenditure, and yet in almost every one of these years they also added to the public debt. The surplus of any year consists in the amount of receipts which are in excess of the ordinary expenditure ; but over and above the ordinary expenditure, there are expenditures on capital and special account, which have to be taken into consideration, and which have always been regarded by Finance Minister's -and very correctly so-as something outside ordinary expenditure. There is nothing new, therefore, in our treatment of these matters. If we are conducting a mail service to a country village, we have to pay for it from year to year, and therefore it forms part of our annual expenditure. But if we build a railway we do not have to build it every year. Once you build a railway or cause one to be built by means of a railway subsidy, there the railway is, and it is no longer a charge on the country. The cost of building it or the subsidy therefore is a charge, not against annual income, but against capital account, and the amount has to be provided for in a special way. Such lias been the method of book-keeping in the past, and that method we have not changed. My hon. friend then has no occasion for surprise that there should be an addition to the public debt and at the same time a surplus in receipts over ordinary expenditure.
With regard to the expenditure on public works, and noticeably on railways, my hon. friend says that we should have a definite plan of all such works to be aided in the future and place on the Table a map showing them. But a little reflection will show 1dm that such a policy is not practicable. It is all very well to talk of laying down general plans, but we have to learn from year Mr. FIELDING.
to year. Every year brings its own needs and its new sources of information, and we must expect in any given year to foreshadow a policy with regard to the particular public works to be constructed in the future. My hon. friend stated that we should have a definite declaration of policy on that point. But we have time and again; given such a definite declaration of policy, and let me repeat that now. Wherever there is found in any province of Canada a proposition to construct a railway, or a breakwater, or a wharf, or anything else which comes within the class of public works that this parliament usually deals with, and wherever it can be shown, to the satisfaction of the government, that the construction of that work will be of use to the public generally and assist in the development of the trade and commerce of the country, that undertaking this government are disposed to favourably consider. I think that is a sufficiently definite policy to satisfy the House and the country. My hon. friends, in their day and generation on this side, were never able to lay down these general lines of policy which we are now told should be laid down, and I do not believe that if they were in office they could lay down a policy any more definite than we are doing.
They say that we arc increasing the expenditure enormously, and by their resolution they call attention to this year's appropriations of $67,000,000. Well. $60,000,000 of that are already voted by this House, and of that $66,000,000 how much did these hon. gentlemen propose to strike out ? They have proposed to strike out one item of $16,000, and they did not even take the opportunity of putting themselves on record in that vote, for it was a motion made in committee, and the names were not taken down. I know that my hon. friend the leader of the opposition tliinks that it is no part of the business of the opposition to call attention to appropriations that are wrong. I must say that I do not agree with him in that. I agree with him that he cannot be expected to have a knowledge of every item in these estimates. But there are many of these amounts which are large and which would justify the hon. gentleman in making a personal study of them with a view to having a motion made to strike them out if they are not fair and reasonable. He has spoken particularly of that class of expenditures devoted to harbours and rivers. A considerable portion of that expenditure is in the province from which my hon. friend and I come. If we do not know about the expenditures outside, we may be expected to have some knowledge of the expenditures in our own province. A proportion of this expenditure is in the county which my hon. friend represents, and which I represented for many years in the local legislature. If he believed that any of these expenditures were

useless and wasteful, lie would move to liave them struck out. But lie knows, so far as he knows his county, that he would not be .iustified in taking any action of that kind. From his generai knowledge of that important constituency, he is aware that it has need of appropriations of this character. I think he might be charitable enough to assume that the knowledge that lie has of his own constituency is probably possessed by others with regard to their constituencies, and, if it would not be wise for them to move to strike out items relating to matters of which he has knowledge, it might not be wise for him to move to strike out those of which he has no knowledge. I think that if any large sum in these expenditures were unreasonable and improper, lion, gentlemen opposite would not shrink from moving to strike them out. I give them credit for great industry in these things. I know very well that they study the questions, and if they were able to successfully attack these items one by one in this House, they would do so-not down to fine details, but in dealing with many of the items. But when we find lion, gentlemen permitting these items to pass without any attempt to call them in question except in a general way-and, as my hon. friend the Minister of Trade and Commerce (Sir Richard Cartwright) reminds me, even asking for more-they are likely to have some difficulty in persuading the country that they are very strongly wedded to a policy of economy.


Robert Laird Borden: I may say to my hon. friend (Hon. Mr. Fielding) that on looking over this list of appropriations to which he refers, I have been able to discover very few in my own constituency. I think that the hon. gentleman's constituency has fared better.


The MINISTER OF FINANCE.: I think my hon. friend is mistaken. That is my impression-without having given the matter any close calculation. But if he thinks his county is not getting enough, I cannot quarrel with the argument.


Robert Laird Borden: I merely meant that my own was so small.


The MINISTER OF FINANCE.: I think the hon. gentleman is mistaken, and that the amount is by no means small. However, if he claims that these appropriations were not enough, that is a matter of consideration, for the county he represents is a large and important one. We are apt to think of Halifax as only the city ; but the hon. gentleman represents the whole county, which is 150 miles long ; and if he says that there should be more expenditure there, I am not going to quarrel with him on that score. But I shall quarrel with him for complaining of the total when added up. For a number of years we have
had an alarmist speech with regard to financial affairs, delivered from the opposition benches at the close of the session. I remember that the first session when it was my privilege to occupy a seat in this House, that is the summer session of 1890, the leader of the opposition of that time, Sir Charles Tupper, took very strong ground. We had hardly got fairly in our seats, the government had hardly brought down estimates of their own, but had merely accepted those of their predecessors, when Sir Charles Tupper declared that we were going to plunge the country into extravagance and debt, and that that year we should have a deficit of two or three millions. If we had done so, it would not have been very much our business, because the appropriations had been largely prepared by our predecessors ; but the fact was it was simply an alarmist speech, as were the speeches of a later day. At the end of the year, instead of a deficit of two or three million we had but the modest deficit of $519,000. Every year since then we have had this alarmist speech at the close of the session. We have had gentlemen engaged in adding up all possible items in order to show an enormous scale of expense, and to convince the country that the finances of the Dominion were going to the dogs. Yet, every year the facts have gone against these hon. gentlemen, as I believe they will go against them in the future. In our first year of full control of public affairs, we realized a surplus of $1,722,000. Yet, next year, we had the alarmist speeches of hon. gentlemen opposite -and at the end of 1899 we had a surplus of $4,837,000. And still we had the alarmist speech about the finances of the country-and when the end of the year 1900 came, we had a surplus of $8,000,000 and over. Now we are going to have, I am gratified to be able to repeat, a very satisfactory surplus during the current year. So, I am glad to be able to soothe the public mind with the statement that notwithstanding these alarmist speeches for four years, when the end of the year came round it has always been found that Canada had a very satisfactory balance-sheet to show.
Then, I would like to ask : Assuming that we on this side are disposed to be extravagant, are hon. gentlemen opposite the right ones to pose in the role of economists ? I will not speak much of the past, though I think that any one who would accuse the Conservative party of bygone years of being a party of economy would render himself liable to an action for libel by any Conservative in the country. But I would like to deal with the living present. We find that these hon. gentlemen deal simply with the total figures- You have increased the expenditure and therefore you have been extravagant.' I have shown with respect

to the amount of $07,000,000 which it put before the country to scare it, we have had hon. gentlemen opposite proposing to strike out only $16,000. But that is not all. 1 have never heard a proposal for economy come from the other side this session. But I have heard many proposals for a lavish expenditure. ' Economy ! ' cries the hon. member for West York (Mr. Wallace), echoed by the hon. member for East Grey (Mr. Sproule) who sits beside him. They are going to vote for this resolution in favour of economy, and declaring that we are extravagant. But the strongest charge these hon. gentlemen have made against us this session is that we will not spend more money by giving a bonus for the manufacture of beet-root sugar. My hon. friend from South Wentworth (Mr. Smith), who takes an intelligent interest in agriculture, will vote for this resolution. But the most severe arraignment that he has made of t)ie government this session is in the form of a demand to know why we do not spend more money in developing the cold storage system. My hon. friend from Pictou (Mr. Bell), whom I do not see in his place, will vote for this declaration that we are extravagant. But only a few days ago the hon. gentleman actually increased the price in real estate in Ottawa, I believe, by demanding that the government should buy more land for public buildings. My hon. friend the leader of the opposition (Mr. Borden, Halifax) is going to vote for this resolution which he has moved, but he did not seem overly anxious for economy wheu he advocated that we should put up new buildings for the public service and add enormously to the expenditure. I am not condemning these things at all, but I am pointing out that these hon. gentlemen are not advocates of economy but of more lavish expenditure than that in which we engage. And all over the House we find the same thing. My hon. friends from Toronto are great advocates of economy in other places ; but they are anxious to have us spend more money on Toronto harbour. My hon. friend from .Taeques Cartier (Mr. Monk) is going to vote for this resolution, in the name of economy he is going to condemn us for spending so much monev. But, only the other day, he led a deputation to the government asking that we should spend about $1,000,000 more in improving the St. Lawrence river.


Frederick Debartzch Monk: We are in favour of judicious expenditure.


The AIINISTER OF FINANCE.: My hon. friend from East York (Mr. Maclean), who is not in his seat, is going to vote for this resolution, I presume, which declares that we are spending too much money ; but the greatest crime he has laid to our charge this session has been that we would not appropriate a few hundred millions more to buy up the railways of the country. My hon. friend from South Lanark (Mr. Haggart),
who is enjoying this thing so much, is going to vote' for this resolution to condemn us for extravagance; and about the most important speech, and a very good one it was, that my hon. friend made this session, was a demand that we should take up the Georgian Bay canals, with its obligation of $75,000,000. My hon. friend from Jacques Cartier (Mr. Monk)-to come back to him-is going to vote for this resolution, condemning us for spending too much money, but his latest arraignment of the government is that we won't provide money for an expedition to search for the north pole.
I said I would follow the excellent example of the leader of the opposition in not extending my remarks to any length. We have reached a period of the session when I am sure we are all desirous of bringing the business of the House to a close. I want to say, in conclusion, that while this government has increased the public expenditure, it has simply increased the outlay in order that it might keep pace with the growing demands of the country. I say that the idea that these expenditures have been wasteful, have been extravagant, have been thoughtless, is not justified. Throughout the whole policy of the government there has been an effort, not to be too economical, not to translate the word ' economy ' to mean parsimony, or niggardliness ; but we understood economy to mean a wise expenditure of public money upon necessary works for the development of the country. We have been able to carry out that policy, we have provided liberally for every great need of the country. We are able to point to the fact that the finances of the Dominion were never in a better condition than they have been during the last few years, that the public credit of Canada never stood higher ; and that all these works have been accomplished with a reduction in the rate of taxation, which means that during the past four years, comparing the old tariff with the new, $6,000,000 have been left in the pockets of the people which would have been taken out of their pockets had the policy of hon. gentlemen opposite remained in force.
' Mr. BORDEN (Halifax). Before the hon. gentleman sits down, I would like to point out to him-and he will correct me if I am in error-that so far as grants to my own county are concerned, if the grants to the province were placed on the same basis, they would be reduced by more than 50 per cent.


The MINISTER OF FINANCE.: My hon. friend forgets that his own county happens to have a railway, and if he will look up the appropriations in the Public Works and Railway Departments, he will discover that there is another side to the story.


Mr. SAMUEL BARKER (Hamilton).: 58c9


Samuel Barker: Eighty-four he says now, but 62 he told me the other day. He tells us that every one of these 62 locomotives in power and capacity is largely ahead of the average of the old ones, so that these 62 locomotives are equal to about 100 of the old ones. That is about 40 per cent increase in locomotive power in one year. Did any man ever hear of a railway manager daring to propose to his proprietors that he would increase his locomotive power by 40 per cent in one big jump ? Why, no one but a government railway administrator would dare to suggest such a thing as that. I quite admit that it is a prudent thing to procure heavy locomotives ; everybody is doing it, but they are not doing it at'this rate and they are doing it out of revenue. Let me show the Minister of Railways what the Grand Trunk Railway does in this matter. This is the Grand Trunk Railway report of the 30th June, 1898, and it says :
The number of engines and cars owned by the company is shown in the return of working stock. No additions to the stock have been made at the expense of capital during the last year. Sixteen engines have been sold or broken up and twenty new engines of modern type and increased capacity have been purchased on revenue account during the half year.
Yet on the Intercolonial Railwav of 1,500 miles, not one-half of the extent of the Grand Trunk Railway, the minister is increasing his locomotives by 62 and he has charged every one of them to capital. That is a very convenient thing for a railway administrator. It is a wonder that the hoii. gentleman can only show $62,000 surplus, when he is able to do that sort of thing. The report of the Grand Trunk Railway says :
There remains on the 30th of June, 1898, sixteen engines in excess of stock, all provided out of revenue.
W by is that ? It is because railway men who have not a government behind them know that locomotives like everything else in this world die out. You may repair a locomotive year after year, but the time will come when it will not pay to renew or repair that locomotive and when it is cheaper to send it to the scrap heap. And so, year after year these old engines are falling into the scrap heap, and the management keep ahead of their requirements so that when a locomotive is worn out they have another one to replace it. The Minister of Railways tells us that he keeps up his locomotives in an efficient condition, but then he keeps

ahead by buying <52 on capital account. Next year the cripples will be coming in, but the Minister of Railways will be safe from any trouble because he has already got new ones at the expense of capital.
I want to say a few words about the rolling stock generally, of the Intercolonial Railway. The Minister of Railways tells us in his report each year, that all his rolling stock is kept in an efficient condition. I find that in the report for the present year the hon. gentleman shows that he handed over from the year 1899-the election year when the hon. gentleman was cutting down his expenses by hook and by crook ; the year that he laid no rails-the hon. gentleman (turned over at the end of that year 528 cars and coaches and locomotives condemned as unfit for service. And during the year 1900 toe added 290 to this, making 824 condemned arbic'es of stock. Well, that is pretty good for the minister ;	824 condemned efficient locomotives and cars. The minister goes on in his report to show that out of the 528 and the 296, lie rebuilt 393. That is a very important statement, and if that statement had been strictly accurate it would have said a great deal in favour of the Minister of Railways. When I examined his stock list, and saw that 393 there as rebuilt, I thought that perhaps the stock list had not been as bad as it looked. Rut I turned to another part of this singular repo#t. There is hardly a page of it that you won't find varied a little by another page. I turn to page 62 of the report and 1 find that instead of rebuilding 393 the minister actually rebuilt only 33, namely, four locomotives, two box cars, eight platform cars, seventeen coal cars, and two Hangers, being 33 out of the 824. The inference is, that this is about all he could find that were worth rebuilding, because he was forced to buy out of revenue 360 new cars to make up his 393 rebuilt. But that would still leave the hon. minister 431 short and the question remained, how did the hon. gentleman get along with his traffic with 431 short ? It is a very serious withdrawal from traffic to have 431 taken away, and how did the Minister of Railways arrange it ? Why he bought on capital account 473.


Some hon. MEMBERS: Hear, hear.


Samuel Barker: The minister ought to have charged 431 out of that 473 to revenue of course, but not he. They all went to capital and the hon. minister went along making his profit out of that capital. I looked at page 59 of the report to see what the 473 cost him on the average, and I find that the average price was $1,212. Therefore, the 431 which the minister ought to have charged to revenue would have amounted to $522.000; but. then again, what would have become of his surplus if he ' did that. There, you see the difficulty the hon. gentleman was in. He had to get a surplus.


Samuel Barker: and how could he get a surplus if he charged all this to revenue V
I might refer to other charges to capital, as, for instance, where the minister replaces buildings which have been burned, and charges them to capital ; so that, you have two charges against capital, and only one asset. I do not know how the minister is to balance his books by and by. It would puzzle an ordinary auditor of a railway company, but the minister may be capable of it.
Now, I have another charge to make, and, to my mind, it is a much more serious one. The figures are not quite so large as those I have been dealing with, but, they present a feature of the management of government railways which is a very serious one, indeed. Especially is it serious if the hon. member for East York (Mr. Maclean) is ever to be able to induce the government or the country to take up his idea of the ownership of government railways. If government railways are to be worked as I am about to show that the hon. gentleman has been working the Intercolonial Railway in 1899, the election year, I think the longer we put off the government ownership of railways the better. I would ask the hon. gentleman's attention to these figures, which demonstrate beyond question, that in the year 1899, the year upon the accounts of which the Minister of Railways and his colleagues were going to the country, the hon. gentleman deliberately and intentionally cut down his ordinary repairs of rolling stock by $154,000 ; and that if he had not done that, instead of a surplus of $62,000. he would, on that item alone, have been $90,000 to the bad. Now, I propose to show that : and I shall leave lion, gentlemen on both sides of the House to judge whether, on the figures 1 give, there can be any doubt at all about what I infer from them. To begin with. I may call the hon. gentleman's attention to the fact that during the four years 1897. 1898. 1899 and 1900, his revenue has been steadily	increasing. The	figures are	as
follows :
1897	 $2,866,000
1898	 3,117,000
1899		 3,738,000
1900		 4,552.000
I	will	not	detail the	gross	working	expenses in each of these years. I will only say that, in 1807, the hon. gentleman had a deficit of $59,000. in 1S9S a deficit of $209,000, in 1899 a surplus of $62,645. and in 1900 a surplus of $120,667. The reason I mention these figures is this, that with steadily increasing traffic, it was reasonable to expect that the hon. gentleman would have shown some increase in his working expenses-not necessarily in proportion, but. a natural and steady Increase corresponding in some degree to the increase in the gross revenue. Now. working expenses are divided into two classes-those which are controllable by the hon. gentleman, and those

which are uncontrollable by him. There are three items which are not within the control of the hon. gentleman : the wages of drivers and firemen, fuel, and the wages of conductors ; and in these three items there were, as might have been expected, steady increases. The wages of drivers and firemen were as follows :
1897		 $267,000
1898		 276,000
1899		 317,000
1900		 359,000
A steady increase, which was quite natural, and what everybody would expect, considering the increasing tonnage that was hauled. The expenditures for fuel were :
1897		 $376,000
1898		 388,000
1899		 467,000
1900		 601,000
This is a remarkable increase in cost of coal for 1900, to which I think the hon. gentleman's attention should be directed, though it forms no part of my present argument. I do not criticise that, as I have not gone into the question of the consumption of fuel. The wages of conductors amounted to :
1897	 $255,000
1898...,	 265,000
1899		 317,000
1900		 360,000
So. it will be seen that in every one of these items there is a steady regular natural increase. Now, I will come to the four items of expenditure that are peculiarly under the control of the management, and I propose to show an extraordinary discrepancy in what I call the election year of 1899. Take the repairs to engines, for which the hon. gentleman spent :
1897		$261,880
1898		 276,068
1899		 221,150
1900		 316,999
The average of the four years is .$209,0(10 : yet, in the year 1S99. the hon. gentleman cut down the expenditure $18,000 below the average, and in the next year he went up to his average, and made up the $18,000 too. The hon. gentleman, by that method of cutting down repairs to his engines, made up a surplus in 1890 of $18,000. Here are the expenditures for repairs to his passenger cars :
1897		 $ 84,793
1898		   86,371
1899		 74,687
1900		 106,608
The average is $90,000 in the last two years, and so we have $10,000 in the election year below his average, and the next year $16,000 above his average. I think that the inference is very plain.
Take postal and baggage cars, which is a small item, but to which I refer to show that the thing has been done systematically
and not by accident. The expenditure on postal and baggage cars was as follows :
1897		 $20,976
1898		 22,276
1899	(the election year)	 12,964
1900		 27,565
The same comparison of figures shows that he cut down his repairs $7,500 in 1899.
Then take the freight cars. Well, he spent on freight cars as follows :-
1897		$231,203
1898		 232,118
1899	(the	election year)	 172,634
1900		 33S.202
The average for the later two
years	was	thus	 255,418
So that the hon. gentleman cut down his expenditure below the average in 1899, and thus obtained $83,000 towards his surplus. The result of these four items is as follows:
Engine repairs	 $48,000
Passenger cars	 16,000
Postal cars	 7,500
Freight cars	 83,000
Or $151,500 saved on ordinary repairs in that year,
I wonder were there any workmen in the shops along the Intercolonial Railway to whom that expenditure of $151,000 would have been a blessing that year if it had been spent among them. No doubt in the hard winter, these workmen would have been much more comfortable in their homes and families if that money had been spent as it ought to have been. There is nothing in the world to which the adage, 'a stitch in time saves nine ' applies more forcibly than a railway. The saving of $151,000 in 1899 probably cost this country half a million dollars in consequent waste and wreckage. So that the hon. gentleman, by the process called among railway men ' skimping repairs ' saved $154,000 and was thus able with the bookkeeping and other matters to which I have referred to show an apparant profit of $02,000 for the year 1899. No wonder the hon. gentleman had to carry 528 condemned cars over to the next year.


The MINISTER OF RAILWAYS AND CANALS.: Was the hon. gentleman at all curious to ascertain how many cars were carried over during the several years preceding 1897 ?


Samuel Barker: That very thought did occur to me. I did not want to do the hon. gentleman any injustice, and I looked away back to 1S96 to see whether this thing lay at the door of the hon. gentleman alone. 1 thought that perhaps the Hon. Mr. Haggart might have been doing this sort of thing also, and I looked back and will tell the hon. gentleman the result of my researches. On the 1st July, 1896, he took over the railway from Mr. Haggart, and the report of that year was made up, not by Mr. Haggart but by his successor the present hon. Minister of Railways.


The MINISTER OF RAILWAYS AND CANALS.: Hardly.


Samuel Barker: The report was not made up on the 1st July, and was not presented until the subsequent session, and no doubt the hon. gentleman's officers looked carefully into it.


The MINISTER OF RAILWAYS AND CANALS.: The report was made up before I came Into the government.


Samuel Barker: 
The MINISTER OF FINANCE.: As my hon. friend is quoting me, I may say that it made no difference in the debt statement. It would make a difference in the surplus of the year, but not as affecting the debt statement of the year.


Samuel Barker: The hon. gentleman, when 1 was questioning the Minister of Railways about his system of charging, and showing how unjust it was and how it misrepresented the profits and losses of the year said :	What difference does it make ?
The hon. gentleman's point was, of course, that it all had to come out of the country. But are not the people entitled to know the truth ? Are we to be be-fooled into the belief that these railways are worked at a profit when they are worked at a loss ? Are we to be asked year after year to vote money for the maintenance of these railways under the belief that they are worked at a profit, when, as a matter of fact, they are worked at an enormous loss ? Why, hon. gentlemen opposite in the general election on every hustings in the country proclaimed the great ability of the Minister of Railways, and declared that he had made profits where others had made nothing but loss, that he had drawn order out of chaos. We want the people to know that he made no profits at all, but that, like others, he had done the work at a loss. I saw in ' Hansard ' that the hon. gentleman had said that hon. members on this side had unduly criticised his estimates. Surely,

what we have heard here justifies criticism. There is not an lion, member on this side, I do not think there is an lion, member in the House who will deny even the last dollar that may reasonably be asked for the maintenance of the Intercolonial Railway. Every dollar that can be fairly asked for will be given, whether the road is worked at a profit or at a loss. But let us know the truth about it. There is another feature showing the lamentable consequences of the hon. minister neglecting his repairs. Last year he had the grandest year in the history of the road. His gross revenue was $4,552.000. He had a great increase of traffic, as had every other road in the country. The railways did not need to seek for traffic-it flowed in upon them. The gross receipts showed an increase of $815,000, as against the previous year-largely passenger traffic. As to that increased passenger traffic, almost the whole of it was clear profit-extra people travelling in the trains. As to the freight, that would simply mean extra cars upon trains. It is not too much to say that it would not cost more than 40 per cent to work it. That is to say, he should have had 00 per cent profit on this $813,ouO increase, or not less than $500,000 cash profit. What a magnificent opportunity for the hon. gentleman to come before the country and claim a surplus. But he had been neglecting his track, he had been neglecting his cars, he had been neglecting his locomotives. And so, though he had $813,000, of which $500,000 ought to have been profit, yet his expenses, owing to his own neglect in previous years went up by $755,000. So, out of the whole $813,000, the hon. gentleman only got a beggarly $58,000. That is the result of the hon. gentleman scamping the repairs in previous years. Reference was' made, I think by the Finance Minister, to the present year as not being so successful as previous years. There is no doubt about that. The hon. gentleman in pursuance of his duty sends out every ten days a comparative statement of the revenues from all sources. We find that up to the 10th of May last year, the hon. gentleman showed a surplus from the, railways of $240,000. But this year at the same date he has a deficit of $497,000. Coming from the Finance Minister, I think we may take it as fairly accurate. So, against a surplus for 1900, we have a deficit for 1901, and the difference between the two years amounts to $737,000. I do not wonder that the hon. gentleman admits that it is not a good year. The hon. Minister of Railways will not be able to explain it away. He has* a great remedy in his capital charges. But I do not think that even that will help him on this occasion.
While I do not intend to go into details about the capital expenditure, I wish once more to repeat what I said at the beginning of my remarks, that during the hon. gentleman's administration, he has charged to capital, including the estimates now before the House, about $13,000,000, adding that amount to the public debt.


The MINISTER OF RAILWAYS AND CANALS.: How does the hon. gentleman (Mr. Barker) make that out ?


Samuel Barker: The charges to capital passed, and estimated under the hon. gentleman, are as follows :
1897		 $ 145,000
1898		 252,000
1899		 1,OS1,000
1900		 1,796,000
1900-	1 (estimates)	
3,505,0001901-	2 (estimates)	
4,539,000

Capital charges on the Prince Edward Island Railway-
1898		 $	17,000
1899		 53,000
1900-	1 (estimates)	
716,0001901-	2 (estimates)	
532,000

Total	 $12,661,000


The MINISTER OF RAILWAYS AND CANALS.: The hon. member did not inform us that he was including the Prince Edward Island Railway, but left the impression that he was speaking of the Intercolonial Railway alone.


Samuel Barker: If I left that Impression, I did not wish to do so. I spoke of the hon. gentleman in connection with the government railways


The MINISTER OF RAILWAYS AND CANALS.: The hon. gentleman said nothing about that.


Samuel Barker: I said that the hon. gentleman, in the administration of the government railways had -added to the capital account of railways in the four years he has had charge of them, including the estimates, nearly $13,000,000. I have shown that the actual figures were $12,661,000. I do not wish to occupy further time. I have taken pains to go carefully over these figures. I believe I have not overstated one fact ; I am sure I have not misquoted one figure. I leave the House to judge whether the hon. gentleman is entitled to the credit he claimed when he said he had worked these railways for the last twb years at a profit. I have to thank hon. gentlemen on both sides of the House, especially hon. gentlemen opposite. for their courtesy in listening to me so patiently. I am sorry I could not have spoken at less length, but going over the mass of figures that I had to deal with. I found it impossible to occupy less time.


Mr. DAVID HENDERSON (Halton).: I shall only occupy the time of the House for
5S71

a very few minutes. I waited, expecting some lion, gentleman on tlie other side would follow the hon. member for Hamilton (Mr. Barker), but none of them seem disposed to do so. We have been charged by the Minister of Finance with taking exception to the very large expenditure that is proposed to be made during the coming year, although we have not challenged any of the individual items as they passed through the Committee of Supply, or on concurrence. I desire to say that I have never understood it to be the practice of an opposition to call for separate votes on different items. It is considered quite sufficient for the opposition of the day to make a fair criticism of those items, and to show wherein they are uncalled for, wherein they are too large. But I say it is not the practice of an opposition, at least it has not been since I have been in this House, to challenge by vote the individual items separately. I am quite sure it was not ihe practice of lion, gentlemen opposite when they were in opposition. I see nothing at all in tlie point attempted to be made by the Minister of Finance when he says that we allowed these items to go through without challenging them. Now, the only matter I desire to refer to is with reference to the surplus. If there is any one thing that is misunderstood in this country it is certainly this bug-a-boo of a surplus. There are many people w'ho actually believe that the government have a large revenue over all their expenditure. An ordinary reader of the speech delivered by the Minister of Finance this afternoon would come to the conclusion flint we had last year a revenue of about eight million dollars over every dollar that we expended. This is owing to the system of book-keeping that is adopted in the Finance Department, a system of charging certain items to capital account and others to revenue account, without making the whole question plain to the ordinary reader. Had the precedent laid down by the former government been continued, and the same class of items charged to capital account as were formerly charged. so that a fair comparison could be made. I would not find so much fault with what is done now. But as has been shown conclusively by the hon. member for Hamilton who has just spoken, in the Railway Department the whole system has been changed, and charges that ,were heretofore made against revenue are now charged up to capital, so that the whole system is misleading to tlie general public. I think the time lias arrived when some new system of bookkeeping ought to be evolved by the Minister of Finance, by which the people could fairly understand the finances of the country. Now, let us take the statement of 1000. In the year ending 30th June. 1000. we had a total expenditure of $52,717,400. made up as follows
Charges on debt	 $10,873,673
Subsidies to provinces	 4,250,608
Sinking fund	 2,465,640
Collection of revenue	 11,044,526
Other expenditure	 14,340,832

On capital account	 7,46S,843
Railway subsidies	 725,720
Other charges	 1,547,624
Grand total-Expenditure. $52,717,466 Total-Consolidated Fund. 51,031.466
Deficit	 $ 1,686,000
This table shows, as I said, that for tlie year 1900-1901 the expenditure was $52.-717,40(5. Now, if our revenue exceeded that expenditure, we had a surplus ; if our revenue was less than that expenditure then we had a deficit. Therefore, I do not think it is fair to tlie electorate of this country that those who are in charge of tlie Finance Department should tell them that we had a surplus, when tlie revenue was actually a great deal less than the total expenditure. Last year our total revenue was only $51.031,400, showing a deficit of $1,080,000. It is clear when you analyse these figures, that we are running behind, that instead of having this boasted surplus of $8,000,000, which the Minister of Finance flaunts before the electors, the actual facts are, taking his own public accounts, that we spent $1,08(5,000 more than all the revenues combined.
Now, why should we continue this system of telling the people that we have a large surplus ? Is it not misleading ? I think it is. It is a bad system, and ought to be changed. The sooner the Minister of Finance changes his system and gives to the people a fair statement of the actual receipts and expenditures, the better will it be for the country. Not until then will the people get their eyes opened to the actual state of facts, and only then will they take those steps which are necessary to arrest the enormously increased expenditure that is going on year by year. Why. they are now asleep. The electors of the country are perfectly satisfied. They say. We have $8,000,000 of a surplus, what is the use of talking about extravagance ? We actually earned last year $8,000,000 more than we spent. The electorate are satisfied. But if you give them a fair and honest statement of the finances of this country, they will see that instead of a surplus we actually spent $1.(58(5.000 more than all the revenue last year,, and that by so much we have increased the national debt of the country. Then the eyes of the electorate will be opened, and then there will be a demand to arrest this enormously increased expendithre that is going on. Sir, not since the hon. gentlemen came into power have they had a surplus, although each year we are told they had a surplus. In three years out of tlie four for which


David Henderson: we have complete statements there has been a large deficit, as is shown by the public accounts. I press again upon the Minister of Finance that the time has arrived that a change should be made in our whole system, and that even If he does make a statement in the public accounts showing a surplus of revenue consolidated fund account, over what he chooses to charge against that, I think at the same time that over and above it all. and more prominently and in larger type, the other figures ought to be given. A full and complete statement of the total expenditure and the total revenue will show that we have a deficit and not a surplus, and then, and only then, will the people of this country grasp the idea that year by year we are going behind instead of going forward.


Mr. RUFUS H. POPE (Compton).: Mr. Speaker, I am astonished at the silence of the hon. Minister of Railways and Canals (Mr. Blair) after the clear and explicit statement by the hon. member for Hamilton (Mr. Barker) in dealing with this question, and after that hon. gentleman produced figures that certainly were astonishing to me and which call for explanation. Surely the hon. minister does not intend to continue to treat this House with the same kind of indifference with which he treated me the other evening. It may be only amusement for the hon. gentleman to spend his time with his back towards me as a single member of this House, but surely, unless he has concluded to abandon his department and to leave the government with which he is associated, he is not going to turn his back upon the whole of Canada and upon parliament and not going to offer any advice or information when the figures say that he is $13,000,000 on the wrong side of the account and when the figures say that if the hon. gentleman's statements are anything at all, they are cooked statements, they are prepared documents for election purposes. Now, Sir, I have some responsibility in this matter, more than I would feel under ordinary circumstances, 'because the hon. gentleman knows that when he asked this House for money to extend the Intercolonial Railway to the city of Montreal, I was one of the few members upon this side of the House who left my party to give that hon. gentleman what I thought a fair opportunity. I said to him then, as I say to him now, that if he did not prove by works his promises in connection with the operation of the Intercolonial Railway, I would be one of the first to call him to account for it. I stand here to-day and say to the hon. gentleman that while he may read with impunity, while he may spend his time as a child, whipped and flogged at school and sometimes snubbed even by his own colleagues, because I understand he is almost forgotten by them, while he may sit there and imagine that this conduct is clever and that it carries
statesmanship with it, I do hold him to account. Behold ! I am glad to see that the hon. minister has at last ceased reading. I have no doubt that he is getting ready to speak and that even he, Sir, will condescend some time during this afternoon, or tomorrow, or some other day to give the information that this House is entitled to receive. Now, Sir, as I was saying, when the hon. gentleman chose to look up, I feel a responsibility in this matter. The hon. gentleman stood up in this House and said : Give me the power to extend that road to Montreal and I will make it a great asset for Canada, I will make it a paying railway, it shall no longer be a deficit maker, it shall no longer be an encumbrance on the lax-payers of this country. Notwithstanding that statement, when the assertion is made iu this House that $13,000,000 of taxation has been imposed upon the people, the hon. gentleman sits in his seat and does not answer, does not even condescend to say to the people of Canada : I will give you a statement. Under these circumstances, I say that we should not go home to-morrow. It is necessary that we should stay here longer, it is necessai'y that this House should not adjourn, it is advisable that we should earn a part of the $500 and stay here a little while longer.


Mr. McCREARY.: I would like to ask the hon. gentleman how many days this session he has been in his seat.


Rufus Henry Pope: I wish to say to the hon. gentleman for his own special, private information, that it is none of his business.


Some hon. MEMBERS: Oh.


Rufus Henry Pope: If he had not been a particular friend of mine and a new member of this House I would not have given him that answer, but I feel that it is due to him to say that as he comes from the wild and woolly west where people are liable to stick their noses into other people's business, I will excuse him. I was saying to the hon. minister that we have a perfect right to an explanation and if we have to stay here for several days we are going to get it. I am good and fresh, and as the hon. gentleman from the prairie province seems to be a little tired he may go home and I will stay here and listen to the hon. minister. But, we are going to have some explanation. We are entitled to an explanation upon this subject and we are going to get it. Why, Sir, $13,000,000 ! Can these figures be correct ? Either they are, or they are not. If they are not correct, why does the hon. minister not get up and give us the true position ? What is he afraid of ? Who is he waiting for ? Why is he so timid ? Whom does lie want to speak before he rises ? What is the matter with him ?


An hon. MEMBER.: He is all right.


Rufus Henry Pope: There must be some answer from the hon. gentleman. This hon. gentle-


The MINISTER OF RAILWAYS AND CANALS.: I would like to have the hon. gentleman intimate what he means by that last remark ?


Rufus Henry Pope: What I mean is this. 1 mean that a contracting firm is used to figuring up the number of feet of lumber, then the quantity of nails, iron and machinery, connected with the construction of an elevator of that kind, the cost of labour, &c., and then to add a profit of 10 or 15 per cent, and make his tender. That is the honourable way, but he was told he could not get the contract for this work on that basis. He was told he need not think of tendering on that basis, that the way for him to do was to make a cut tender, and then take his chances of settlement with the government by other means later on.


The MINISTER OF RAILWAYS AND CANALS.: Does the hon. gentleman (Mr. Pope) mean to suggest that I. or any one with my knowledge or authority or consent, made any such statement to any tenderer ? If the hon. gentleman will say, as a member of this House, that he has any information which in the slightest degree touched me or touched any one in the department, that under authority from me there was such a statement made to any tenderer, I would like the hon. gentleman to give that information.


Rufus Henry Pope: Mr. Speaker


Some hon. MEMBERS: Name.


Rufus Henry Pope: I will name anything you want me to name. The contractor referred to was .T. S. Metcalfe & Co., of Chicago ; you may know them.


The MINISTER OF RAILWAYS AND CANALS.: I want to know from you the name of any person who gave you that information.


Rufus Henry Pope: That is the firm that was intending to tender.


The MINISTER OF RAILWAYS AND CANALS.: Who informed the hon. gentleman that any person made any such statement as representing me or this government ?


Rufus Henry Pope: You want me to say who represented you ?


The MINISTER OF RAILWAYS AND CANALS.: Certainly.
Mi-. POPE. I cannot say who represented you. It is impossible for me to say who represented the hon. gentleman, but the go-between-because there is a go-between between this government and practically every contract they let-you know John Connor, I think ; that is his name.


The MINISTER OF RAILWAYS AND CANALS.: I want to say to the hon. gentleman (Mr. Pope) that I defy him to name any solitary individual representing the government, or the department with which I am connected, who had the slightest justification or authority for making any such statement as that. I defy him.
Some lion. MEMBERS. Name.


Some hon. MEMBERS: Take it back.


Rufus Henry Pope: Well, Mr. Speaker, this is getting interesting.


William Ross: It is getting scandalous.


Some hon. MEMBERS: Name.


Rufus Henry Pope: Do not be in a hurry ; I was here before some of you, and I will be here after some of you.


Mr. SPEAKER.: I must ask the hon. gentleman (Mr. Pope) to address the Chair.


Rufus Henry Pope: I will address the Chair when the rest of the House do not address me. I want to be able to defend myself.


Lawrence Geoffrey Power: The hon. member who has the floor must address the Chair, and no interruption will be permitted.


Rufus Henry Pope: I beg your pardon, Mr. Speaker. If I overlooked your presence it was unintentional. I made this statement-


The MINISTER OF RAILWAYS AND CANALS.: I challenge the hon. gentleman to make the statement.


Rufus Henry Pope: I am delighted to see that even if it is only in a passion the minister consents to speak. It is encouraging for the future. No doubt the information will be obtained more easily in the future from the hon. gentleman than it has been in the past. Well, Sir, this Mr. Connors is a go-between. I do not know his position ; 1 do not know that he is an employee of the government. I know that he was here on that occason doing his duty to himself or to his party, I cannot say which. It was not my buisness to know. He was here, and he seemed to speak with authority. On that occasion a rather interesting conversation took place between Mr. Connors and Mr. Metcalfe, a triend of mine, whom I have known all my life. Mr. Connors took Mr. Metcalfe for a long walk, thinking that, as he knew me, he might get me to plead his cause with the hon. gentleman. Mr. Connors said to him. ' Yrou have known Mr. Pope for many years ? ' ' Yes, I know Mr. Pope.' Mr. Connors said : ' He is a good fellow, but he is not the man you want ; he has not the elasticity of purpose for the occasion.' Now, what did Mr. Connors mean that Mr. Metcalfe should understand by elasticity of purpose ? The minister himself can say. He knows Mr. Connors perfectly well; he knows what position he is in ; and if he chooses to

deny that Mr. Connors had any authority, that 'is lids business.


The MINISTER OF RAILWAYS AND CANALS.: If the hon. gentleman mentions the name ol' Mr. John Connors as having had any commission or instructions from me. or the slightest shadow of authority from me to make any communication of any kind whatever on that subject to anybody, I want him to understand that Mr. Connors spoke and acted without the slightest warrant. There never was a particle of authority given by me to any living man to make any such communication, or to suggest that there was any other form or manner of getting a contract in the department than the ordinary, regular and proper form of communicating with the department.


Rufus Henry Pope: I certainly accept the statement made by the hon. minister, as he knows the situation better than 1 do. I only tell him the side of the question that came before me, and as it came before me. I would say this much, that the hon. minister in un-forfuunte in the people who cling around him. Down at Levis we hear the name of William Pugsley. There always seems to be somebody intervening for elasticity of purpose. That is the kind of man who is wanted-a man of elasticity of^ purpose. Why, no man can go to the Windsor Hotel without having to pass an office there. It is known as the toll-gate. I will not connect the name of the hon. minister with it, although the public do. They even go so far as to call it Blair's toll-gate. I have been told that that is where they take men in order to prepare them for a visit to the hon. minister ; and that if they are not suppliant and do not yield just as they are wanted to do, they are given a few doses of Abbey's Fruit Salt, to fix them up, and that they can come here. And let any lion, gentleman look at the list of shareholders of Abbey's Fruit Salt, and he will see that it gives colour to this statement. You will find in that list the names of men who have probably over and over again-I do not say dis-honestly-liad negotiations with the Minister of Railways and the government, in order to put through contracts. What the hon. minister's connection with that fruit salt is, I do not know; but that is the statement that is made, that that is a toll-gate where men are taken in and prepared to meet the minister; and if they are found to be a little pugnacious, and do not yield to the elasticity of purpose that is required in order to do business with this government, they are there and then given tlieir medicine, dose after dose, until they become supple, and show sufficient elasticity of purpose to negotiate a contract with this government. The hon. minister may deny that this has anything to do with his department; but this is the state of things the hon. gentleman has led his department up to. This is well known : it is no invention of mine. It is
in the streets of Montreal, far and wide. This list of shareholders was handed to me by gentlemen who were astounded to find such a condition of things existing ; and when we find this man Connors going about this country and attempting to intervene, the Minister of Railways will not tell me that at that time Mr. Connors was not calling at his office. I cannot say what he did when he got inside. So far as I know, the only mission he had in Ottawa was for elasticity of purpose, which was so necessary, in order to get to that department. As to what he was doing here, I do not know. The hon. minister must answer, and when he condescends to answer we have to accept the explanations he gives us. Now, I trust that the hon. gentleman will condescend to go further and give us an answer in regard to this $13,000,000. We have discovered that^ he can still speak, that he is not speechless,* that he has the power of voice, that he has the use of the English language perfectly, and it is possible for him still to make a speech in this House. Therefore, I trust that when I take my seat the hon. gentleman will at least give us the information we ask for and also clear his skirts and the skirts of the government with which he is connected, of the charge of this $13,000,000. That charge must stand against his administration and against his word of honour as a public man, uttered in this House five or six years ago, when he asked us to vote millions of dollars to extend the Intercolonial Railway to Montreal. He made a public declaration of policy, asking me and every other member of this House to vote with him on that occasion.


The MINISTER OF RAILWAYS AND CANALS.: Will the hon. member permit me ? Does not his memory follow me, in saying that he was one of the gentlemen who urged upon me that we should buy that railway ?


Rufus Henry Pope: I never urged whether the hon. gentleman should buy it or not. What I said was that I was prepared to support the principle of extending the Intercolonial Railway to Montreal, and that the government and the hon. minister himself must assume the responsibility of the act. I said that if he did not bring out the results that he had promised to the people of this country, I would find fault with him ; and I am here to find fault with him when I find a charge of $13,000,000 against him. and he does not rise to refute it. How big a bill 'does he want in order to make a stand ? Is not $13,000,000 big enough ? It is time that some member on the other side of the House who supported him should show himself independent enough to speak on this question. It is time the Prime Minister himself said to his colleague, answer to the people of Canada in regard to this charge of $13,000,000.
Mr. FOPK
5881 MAY 22, 1901 5882


Mr. JABEL ROBINSON (Elgin).: The charges I have heard made by the hon. member for Compton (Mr. Pope) are entirely new to me. I had no idea that $13,000,000 would be charged against this government for dereliction of duty in Its management of the Intercolonial ltailway; and I do think that if the hon. member for Compton knew that he had grounds for making such a charge, he should have brought it before this House before to-day. We should have a committee to investigate this matter, and for my part I feel like staying here until it is investigated. However, as I understand the motion before the House, it lias nothing whatever to do with the Intercolonial Railway, except in so far as our expenditure is concerned. The expenditure has been heavy, and the question is whether it is too heavy or not for this country to bear. I notice that hon. gentlemen on both sides are very anxious that this country should bear a heavy expenditure, and when I remember what occurred yesterday, I am satisfied that there are only six members in this House entitled to vote for this amendment-two on that side and four on this. I have no objection to money being expended, because we must *progress and improve, but we should see that we have value for the expenditure we make. .And if it can be shown that we are not getting full value, then the country should be fully seized of that fact, so that the people may take action the first opportunity offered. House divided on amendment (Mr. Borden, Halifax) :
 YEAS : Messieurs Alcorn, Kidd, Bell (Addington), Lancaster, Bennett, LaRiviSre, Birlcett, Lefurgey, Blain, Lennox, Borden (Halifax), Maclean, Boyd, McGowan, Broder, McLeod, Bruce, Monk, Calvin, Morin, Clancy, Osier, Clarke, Pope, Cochrane, Pringle, Culbert, Richardson (Grey), Fowler, Robinson (Elgin), Gilmour, Rosamond, Hackett, Sherritt, Haggart, Smith (Wentworth). Halliday, Sproule, Henderson, Taylor, Hughes (Victoria), Tolton, Ingram, Vrooman, Johnston (Cardwell), Wallace, Kaulbach, Wilmot, Kemp, Wilson.-51. Kendry,
 NAYS : Messieurs Archambault, Lewis, Bazinet, Logan, Belcourt, Lovell,	Bernier, Loy, Blair, Macdonald, Bonrassa, Mackie, Bourbonnais, Maclaren (Huntingdon), Britton, McCarthy, Brown, . McCook Bruneau, McCreary, Bureau, McEwen, Calvert, McGugan, Champagne, Mclsaac, Christie, McKinrcn, Copp, McLennan, Cowan, Madore, Davies (Sir Louis), Malouin, Davis, Marcil (Bagot), Delisle, Marcil (Bonaventure), Demers (Levis), Martineau, Demers (St. John), Matheson, Desmarais, Meigs, Dugas, Mignault, Emmerson, Monet, Erb, Morrison, Ethier, Oliver, Fielding, Parmelee, Flint Paterson, Fortier PrSfontaine, Fortin,' Proulx, Oallerv Reid (Restigouche), Gauvreau, Roche (Halifax), Geoffrion, Ross (Ontario), German Ross (Rimouski), Gibson,' Ross (Victoria), Girard, Rousseau, Gould, ?lLs^U>
Guthrie, SeheU, Harwood, Holmes, Stephens, Horsey Sutherland (Essex), Hughes (King's, P.E.I.), Sutherland (Oxford), Johnston (Cape Breton), Talbot, Kendall. Tarte, Lang. Thompson, Laurier (L'Assomption), Tobin, Lavergne, Tolmie, LeBlanc, Tucker, Legris, Turgeon, Lemieux, Wright.-100. PAIRS : Messieurs Dobell, Brock, McColl, Ward, Cartwright (Sir Rich'd), Tupper, Dyment, McCormick, Johnston (Lambton), Simmons, Fitzpatrick, Casgrain, Fraser, Bell (Pictou), Hyman, Carscallen, Biclcerdike, Roddick, Smith (Vancouver), Reid (Grenville), Fisher, Barker, Galliher. Prior, Maxwell, Earle, Scott (Assa.), Roche (Marquette), Heyd, Cargill, Charlton, Tisdale, Laurier (Sir Wilfrid), Northrop, Borden (Kings, N.S.), Ball, Angers, Robinson, Turcot, Hale, Edwards, Ganong, Mulock, McLaren (Perth), Douglas, McIntosh, Murray, Seagram, Carroll, Lavell, Costigan, Clare, Wade, Gourley, Amendment negatived.


INQUIRY FOR RETURNS.
Mr. HENRI BOURASSA (Labelle).: Before the motion for supply is adopted. I wish to make a remark or two concerning certain documents brought down in reply to addresses carried by this House in March last. As the House knows, I have often urged the bringing down of these documents. At one o'clock I received part of them.
There were two addresses voted on the same day-one for the correspondence between the Bi'itish government and the Canadian government concerning the commissions to be granted to Canadian officers in the British army ; and the other for the correspondence between the British and Canadian governments regarding the South African police force. Many documents were brought in reply to the first address-that relating to the commissions to be granted Canadian officers in the British army, including commissions that have been granted to Canadian officers in the West African police force. But, for what reason I do not know, not a single document has been brought down in response to the second motion. I do not suppose it could have been a very voluminous correspondence. Now. the position is this: I have moved for documents relating to a public question, a question of deep interest to the country, a question that has been discussed in political papers as well as in military organs, that has caused a great deal of comment throughout the country. The motion had in view to make public the conditions upon which these commissions were offered to Canadians. I wanted to know also whether the first steps were taken in England or in Canada-I think it is the right of parliament to have those documents. But. either His Excellency or the government has thought proper that all the documents should not be brought down. From what I have been able to learn from these documents since one o'clock, I think that the papers that are lacking are probably at Rideau Hal!. Among the documents produced, are several letters exchanged between Lord Minto and Mr. Chamberlain, and also letters between the Governor Gen- ' eral and Lord Roberts. Some of those documents refer to correspondence that does not appear here. For example, there is a telegram of the Oth April from Mr. Chamberlain to Lord Minto. referring to a previous telegram of the Oth April, and referring also to a special despatch called 'confidential,' dated 24th March. 1900, the contents of which the Colonial Secretary instructs the Governor General to communicate to his advisers. Either the contents of that despatch have been communicated to His Excellency's advisers, or they have not. Either the Governor General has carried out the orders of the Colonial Secretary. or he lias not. If lie lias not carried Mr. ROBINSON (West Elgin).
out those orders, the country should know it. If he has, the documents giving the precise instructions which he was to communicate to his advisers should have been brought before parliament. I may be told that there is a good deal of private correspondence exchanged between the Governor General and the Colonial Secretary. I know that the Governor General is not only the representative of the Crown in Canada, but also an official of the British government. I acknowledge that His Excellency has the right to exchange any private correspondence that he likes with the Colonial Office. But I do not acknowledge that the Governor General of Canada has the right to give instructions to the government of Canada, or the right to communicate them instructions from the Colonial Office, without bringing before the country all the documents on which those instructions are based. The time has passed when the government of this country can be carried on by private correspondence between Rideau Hall and Downing street. Whatever reasons the government may have for not bringing down this correspondence, parliament is entitled to know those reasons. And if there is private correspondence which resulted in inducing the government of Canada to supply Canadian soldiers to the British army, the word ' confidential ' ought to disappear, and the documents produced. The word did not prevent copies of some of those ' confidential ' documents of His Excellency being included among the papers that are sent to the House. Why not the others ? It is evident that there was some discussion between His Excellency and his advisers as to the authority which should recommend the Canadian officers to whom commissions were to be granted in the British army. I have made up my mind on that subject, and have expressed my opinion very clearly. I share entirely the opinion of the Canadian Military Gazette that the government of Canada should not have allowed the Imperial authorities to set on foot a movement in Canada to induce our officers to go there. It is plain from one of the documents that the commissions offered to the Canadian officers in the West African police are intended to lead to permanent employment in the British army. These officers are offered free transportation to Africa : they are to serve for some years on probation ; and they are offered leaves of absence to go to England and to return to Africa, but not to come to Canada. Therefore, the opinion of the Military Gazette, of which we had no proof up to this time, is well established, that this granting of commissions to Canadian officers in the Imperial army, especially in the West Africa police force, is simply a means of taking away Canadians for permanent residence in Africa. As a Canadian, notwithstanding what any one may

say as to the loyalty we owe to Great Britain, I hold that it is not the duty of the Governor General or his advisers to offer inducements to young Canadian officers to become settlers in Africa. We in Canada are making great sacrifices to keep our young men here, and also to bring settlers from outside, and we should not lend ourselves to any such movements as this that I have referred to. I go further : there are a number of commissions in the Imperial army offered to graduates of the Kingston Royal Military College. I have no objection to any Canadian officer going of his own free will to servo in the British army. But I do object to the government of Canada using the public money to promote his going. For what purpose was this college established, and for what purpose do we keep it up ? To educate young Canadians in military science. Then you get a staff of officers who can take command of our militia, so that when we need officers to command our soldiers for the defence of the country we shall have them. But now at the close of every course of study at Kingston, British officers will be allowed to come here and take the best of our officers, the best or our militiamen, and enlist them in the British service in Africa and elsewhere, a service that will become permanent, as said in the despatch from Lord Minto to Mr. Chamberlain. I am willing that the majority of this House should say, if they like, that Canada should continue to assist the British Empire when in danger. I respect the opinion of the majority when they say that in the hour of danger Canada should go to the help of the British Empire ; but I deny to any member of this House, if he is faithful to his duty as a representative of Canada, the right to tax the Canadian people in order to educate a staff of officers for the British army. They pay heavily in England for supporting their own army and educating their own officers. We do not ask the people of England to help us pay for our militia, we do not ask a penny from the British government to help us in training our officers. For fifty years back we have been taxing the Canadian people without asking a cent from the British government to aid us in military expenditure. Two militia Bills have been adopted for defraying the expenditure on behalf of the military defence of Canada ; time and again we were told that the expenditure was to be used for that purpose alone. But if you are going to take the pick of our young men, the best of our young officers that are trained in Kingston, and give them to Lord Lansdowne and .Mr. Chamberlain to serve the British government in Sierra Leone, or in the Transvaal, or in Rhodesia, with the prospect of becoming settlers in order to develop Cecil Rhodes' land in north Rhodesia, that he has not been able to settle with British people-
I say we are taxing the Canadian people I
upon false pretenses, and we are simply assisting the British government to play that little game under the flag of loyalty. I have nothing to say of what has taken place in the past. This motion has nothing to do with the South African question. The South African question might have come up if the correspondence askeu for by the other address had been brought down, i have asked for that correspondence during three months, and could not get it. But this correspondence has nothing to do with tire South African question. It has to do solely with the question of granting commissions to Canadian officers in the i>.,,isli army. I say that if we allow our young men to go into the British army, we should at least not offer them any inducements to do so at the expense of the Canadian people. When I say at the expense of the Canadian people I want to be understood. I do not say that we pay to send them there, that we pay them when they are there ; but I say we have paid for their education, we have voted a military budget every year to keep up our militia, and it is not right iliat an agent of the British government should be allowed to come here and take the pick of those young men in order to incorporate them in the British army. No doubt the British army should be improved ; I hope that Great Britain will recover her prestige that has been injured in South Africa. I cannot prevent the majority of this parliament, if they desire, from voting as much money as they like for sending contingents to South Africa : but they should tell the people of Canada frankly what is going on.
There is in that correspondence a long despatch from Lord Stratlicona to the government saying that he has done his best in order to have an increased number of commissions allowed to Canadian officers. 1 do not think it is the duty of the representative of Canada in England to say to the British government that the more of our young officers they take from us the (letter for Canada. As I said, I am willing to give every freedom to Canadian officers who want to serve in the British army ; but I do not think that our government should lend its assistance to offer them any inducement to do so. It is the duty of the government of Canada to provide for its military defence, but it is not the duty of the government of Canada to allow agents of the British Empire to come here and take away the best of our young officers to make settlers for their poor colonies.
Mr. MeCREARY. How would you prevent it ?


Joseph Henri Napoléon Bourassa: I say that the government of Canada should not become itself an agent of the British government for that purpose. Whether the government has done it or not, I cannot say. But Lord Minto has made these offers, Mr. Chamberlain has made these offers, as we find in these de-
588/

spatches offering commissions in the West African police force with the understanding that it would become permanent employment, that the only leave of absence granted them would be from Africa to England and back, with no leave of absence to Canada. I say this is an effort made under false colours to secure emigrants from Canada to Sierra Leone and Rhodesia for the purpose of settling up that region. That is the opinion of the Canadian Military Gazette, expressed on several occasions, that is the opinion of the Montreal Witness and several other independent papers of Canada. But up to this moment we have not got the documents, and I now give notice that on the first day of the opening of the session of the next parliament, 1 shall move for the whole of these documents, documents that 1 have not been able to get after three months' effort, and after two addresses voted by the House. I do not blame the government for this, because most of the documents that are missing are in the correspondence exchanged between the Governor General and the Colonial Office. Here let me say that I would like His Excellency's advisers to represent to him during recess that before being a servant of the British government he is the head of the executive government of Canada, and he has no right to conceal front the parliament of Canada documents which


Lawrence Geoffrey Power: Order. The hon. gentleman has no right to speak disrespectfully of the Governor General. It is against rule No. 30. which says that such expression should not be used.
Mr. BOCBaSSA. What are the words you would like me to withdraw ?


Lawrence Geoffrey Power: The hon. gentleman has said that the Governor General had not conducted himself properly in his relations with his advisers. I would ask the hon. member to withdraw those expressions. I do not remember the exact expression that he used, but the hon. member must remember what he said. I must ask him to withdraw the offensive words.


Joseph Henri Napoléon Bourassa: I would simply point out to Mr. Speaker thnt I did not use the words that the Governor General had not conducted himself properly. I said mat 1 would like the advisers of His Excellency to represent to him that he had no right to conceal any documents. Are those the words you want me to withdraw ?


Lawrence Geoffrey Power: The hon. gentleman must remember the exact words that he used better than I do. I am clear only in the understanding that he used language disrespectful of the Governor General, language which must not be permitted in the House.


Joseph Henri Napoléon Bourassa: Of course I always desire to remain within the limits fixed for debate. I am ready to withdraw anything


Joseph Henri Napoléon Bourassa: that you may construe as disrespectful to the Governor'General, because that was not my intention. My intention was to say that in the interests of Canadian loyalty to the British Crown, and in the interest of the good relations that should exist between the representative of the Crown in Canada and his advisers and parliament, there should be perfect frankness observed towards the people of Canada. If I were in the uerman parliament I would be allowed to criticise the action of the Emperor, as it is done there.


Some hon. MEMBERS: Order.


Joseph Henri Napoléon Bourassa: But in this country we have not the same privilege, and therefore I withdraw anything that you think, Mr. Speaker, is disrespectful to His Excellency.


The MINISTER OF TRADE AND COMMERCE (Hon. Sir Richard Cartwright).: Mr. Speaker, I desire to say a word or two. If the hon. gentleman (Mr. Bourassa) thinks that he has any ground of complaint against His Excellency's advisers it is open to hint now or at any time to censure them. He has no right to censure His Excellency, especially as His Excellency is not responsible to us, but as His Excellency's ad^ visers, we are fully prepared to take any responsibility for the acts of His Excellency, and if we were not so prepared, we would cease to be His Excellency's advisers. As for the rest I shall not at this moment trespass upon the time of the House further than to say that while it is possible there may be some confidential communi-i cations, which, from the nature of the cases, cannot be brought down, it is quite evident that all the information which is really pertinent to the matter has been brought down, although I have not had an opportunity of examining the papers in detail. I would say this, however, that we must remember we are a part of the British Empire, and it is the right of the sovereign in iny judgment to call upon all his subjects from one end of the empire to the other to respond to the invitation to defend their country in any way. It is no insult to the people of Canada, but on the contrary, it is a great compliment that her soldiers and officers should have so proved themselves in the late campaign that His Majesty's advisers are anxious to know whether they can obtain the services of Canadian officers. It is free and voluntary to any one who chooses to accept service in the Imperial army. It is the right of the sovereign of the empire and his advisers at all times to call upon those of his subjects who choose to accept that invitation. So. I say that the hon. gentleman (Mr. Bourassaj very much mistakes the nature of the connection between this country and Great Britain if he thinks that the men who have gone from tItn Royal Military College to serve in the British army have not served Canada

"well by so doing. Sir, of these young men who, since that college was instituted, have been tendered commissions by the British government, we have every right to be proud, and it is pleasing to me to be able to remind the hon. gentleman behind me, that among them no men have distinguished themselves more than some of my fellow-countrymen of French origin. I beg further to remind him that of all the officers who have received distinctions for their conduct in the present campaign, the one who has received the highest distinction is a French Canadian, the son of one of the members of the Supreme Court bench, and I believe, I express the opinion of the overwhelming majority of my fellow-countrymen of French origin when 1 say that there will be found, I believe, no man but the hon. gentleman himself, who complains that the British government are seeking to obtain recruits from the ranks of our officers for service in defence of the empire in South Africa or elsewhere.


Robert Laird Borden: Mr. Speaker, I want to say just a word in en-dorsation of what has been said so well by the hon. Minister of Trade and Commerce (Sir Richard Cartwright). It is/the duty of His Excellency's advisers to assume responsibility in every way for him, and by reason of their so doing any cricitism which is offered must be against them and not against him. Therefore, it has always been regarded as absolutely improper to make any reflection at all upon the sovereign or the representative of the sovereign in parliament. I agree entirely with what has been said by the hon. Minister of Trade and Commerce in regard to the value to this country of the services of the men who have so distinguished themselves in South Africa, and I desire to tender my congratulations with his to our French Canadian fellow-citizens of this country on the honours that have been won by Sir Percy Girouard, who has obtained a distinction in that campaign which reflects credit upon every one of us in Canada. I desire further to point out in relation to what has been said so well by the hon. Minister of Trade and Commerce, that it would be a most selfish thing for us to deny the services of our men to Great Britain for the reason that Great Britain has always been ready to afford to us the services of many distinguished officers who have been loaned to this country for the purpose of advancing our military efficiency. 1 am not referring simply to the general officer commanding, but we have had in the past, and we have now, in the Department of Militia, officers whose services are of the greatest possible value to this country and who have come to us from the Imperial service. Therefore, for the reasons which the hon. Minister of Trade and Commerce has so well expressed as well as for this further reason I think there can be no possible objection to the 185
action which has been taken by the government in respect to this matter.


Samuel Hughes: I shall not say anything upon this subject, because I think the hon. member for Labelle (Mr. Bourassa) has been well answered by the hon. Minister of Trade and Commerce (Sir Richard Cartwright) and by the hon. leader of the opposition (Mr. Borden, Halifax). I wish to speak about an item which the hon. Minister of Finance (Mr. Fielding) kindly allowed to stand over for a day or two, and which the hon. Minister of Militia and Defence (Mr. Borden) promised to take into his very careful consideration, the case of Col. Van Wagner. It was requested, and the minister has promised to comply with the request if possible, that he should transfer him from the list of retired officers to the reserve of officers. As for the other subject that I purposed speaking about in connection with this item it will stand until next year, and I therefore beg to thank the hon. Minister of Finance for allowing this item to stand and to say that I am now willing that it should be passed.


[Stage Direction]
Motion agreed to, and House went into Committee of Supply.
At six o'clock, committee took recess.
After Recess.
House resumed at eight o'clock.

[Stage Direction]
House in committee on Bill (No. 112) respecting the Montreal and Southern Counties Railway Companies.-Mr. Carroll.
Mr. FLINT.: I wish to put myself right in regard to this Bill. In moving that it be referred back to the Standing Committee on Standing Orders, on a former occasion, I made the statement that this Bill had not been taken up by the Railway Committee until the end of the sitting, and that was the reason why the difference between the Bill and the petition had not been noticed. I have ascertained that this Bill must have been passed at the first portion of the sitting of the Railway Committee and not at the second portion, and as some of my hon. friends told me they were influenced by the statement I made on a former occasion, I desire to withdraw it. I have no interest at all in the Bill on its merits, one way or the other. The Standing Orders Committee has taken into consideration the recommendation of the House to reconsider the Bill, and they found that in some particulars it did not agree with the notice and the petition, but they have reported the Bill.


William Forsythe McCreary: This Bill is of considerable importance. It has been brought down late in the session, and there is considerable doubt that the petition presented



to the House agrees with the main body of the Bill. I am inclined to think, notwithstanding what the chairman of the committee said, that this Bill is not in accordance with the petition presented to the House, and that it gives powers to this company that the House would not grant were we in possession of the facts. The Bill pretends to deal with certain matters affecting the electric railway and other railway systems in the city of Montreal. As a member of the Railway Committee, I must say that I am not at all aware what this Bill means, except that it involves principles which should not be passed without great consideration. We are now within twenty-four hours from prorogation, and I think the hon. gentleman should withdraw the Bill.


Frederick Debartzch Monk: I do not think the facts are as complicated as the hon. gentleman (Mr. McCreary) would suggest. There was a petition for an extension of the time to begin the line, and the petition was in absolute accordance with the notice given. In the Railway Committee, the company was given power to use steam, which it never prayed for in the petition, and it was also given power to extend its bonding privileges, which also was not asked in the petition. There was another clause giving power to cross the Victoria bridge at Montreal. That had not been mentioned in the notice, but that power rests with the company under the Railway Act. The main object of the Bill is to ask for an extension of time. The House, through one of its committees, has thought it proper to place in the Bill some provisions that were not prayed for, and it would not be fair, I think, to make the promoters of the Bill suffer for what was done by a committee of the House. If necessary, we can eliminate these powers that are objected to.


Mr. LEMIEUX.: I quite agree with what the hon. member (Mr. Monk) has said and I really do not understand the opposition of some hon. members here. The Railway Committee has thought it proper to insert provisions which were not prayed for, and I do not see why the promoters of the Bill should suffer for that. In order to meet the wishes of those opposed to the Bill, we will take out the objectionable clauses, and with that end in view, I beg to move, seconded by Mr. Davis :
That the following words be struck out (a) from the word ' by ' in the second line of section 1 to the word ' and ' in the third line inclusive ; (b) all the words at the end of subsection 2 of section 1, commencing with the words ' and for the ' In the seventeenth line thereof, to the end of the subsection ; (c) all the words of section 2.
Therefore, the words ' except steam ' will remain In the Bill, and the power of crossing the Victoria bridge, and the reference about bonding power is also stricken out.
Mr. McCreary.
It would be an injustice towards the promoters of the Bill to kill it in committee now.


Andrew B. Ingram: I think that suggestion ought to meet the approval of those opposing the Bill. It has been stated here that the words ' except steam ' were placed in the Bill by the Railway Committee, but that cannot be correct, for I find that the words are included in the Bill as originally introduced by Mr. Carroll. The Bill was objected to because no notice was given as to these powers, and, therefore, those opposed to them could not be heard. Now that the objections have been removed, I, for one. see no reason, why the Bill should not pass.
Bill reported, read the third time, and passed.


CONSIDERED IN COMMITTEE-THIRD READINGS.
[Stage Direction]
Bill (No. 149) to amend an Act passed during the present session, intituled : ' An Act to incorporate the Fort Qu'Appelle Railway Company.'-Mr. Douglas.
Bill (No. 154) to confer on the Commissioner of Patents certain powers for the relief of Eudora Sibbald.-Mr. Cowan.

[Stage Direction]
House again in Committee of Supply.
Government cartridge factory, ammunition (revote), $54,000.
['My lion, friend (Mr. Borden, Halifax), I understand, contends that it was placed there by agreement, and not by statute. All these matters at the time of confederation were on a 5 per cent basis.\nSome resolutions reported.\nOn motion of the Prime Minister (Rt. Hon. Sir Wilfrid Laurier), House adjourned at 12.05 a.m.-Thursday.', 'Thursday, May 23, 1901.']
Thomas Simpson Sproule: Are we manufacturing in Canada now what cartridges we use, or are we importing any ?


The MINISTER OF FINANCE.: I may say, that the Minister of Militia is absent owing to sickness in his family ; but my impression is that his intention is, if not now, at an early day, to manufacture entirely in Canada.
Intercolonial Railway-To provide for payment of award of arbitrators in connection with Eastern Extension Railway, Nova Scotia, $671,836.


The PRIME MINISTER.: Judging from the discussion which took place in this House a few days ago, and in which this item was incidentally mentioned by some hon. gentlemen opposite, there seemed to be a little misconception as to the real nature of the appropriation which is now being asked from parliament; and, therefore, it will not be out of place to offer a few words of explanation as to the circumstances which have induced the government to place this item in the estimates. In the year 1877 the Intercolonial Railway had not reached the proportions it has to-day. It was confined to a single line of railway from Halifax to St. John and from Halifax to Rivi&re du Loup, and there was a branch from Truro to Pictou. The rest of the province of Nova Scotia was not

served by railway communication, and the people of that section of the country-the counties of Pictou, Antigonish, Guysborough, and the whole island of Cape Breton-petitioned and pressed upon the government-not only upon the Dominion government, but the provincial government-to have this railway extended at least from Nova Scotia to the Gulf of Canso.
The province of Nova Scotia was little able to undertake itself such a heavy task. It applied to the Dominion government for aid, and the Dominion government-at that time the government of Mr. Mackenize-in 1877, came to the conclusion that it would afford aid for the construction of a piece of road from New Glasgow to the Gulf of Canso, a distance of eighty miles. An Act was passed to that effect, and the aid which was then offered by the Dominion government was to give to any company which would undertake the construction of the eighty miles of road from New Glasgow to the Gulf of Canso, the piece of road which was then in existence, a part of the Intercolonial Kailway, from Truro to New Glasgow. An Act was passed to that effect in the session of 1877. Two years afterwards, when the government of Sir John Macdonald came into office, this arrangement wras ratified and an agreement entered into by the Dominion government, and provincial government and Cape Breton Railway and Coal Company. By that agreement, the Halifax and Cape Breton Railway and Coal Company undertook to build that section, which was known as the eastern extension from New Glasgow to the Gulf of Canso. The consideration which was given by the Dominion government consisted in the transfer in fee simple to that company of the section of the road between Truro and New Glasgow, the Dominion government, in the meantime, retaining that road in its possession until the other section between New Glasgow and the Gulf of Canso was thoroughly equipped and in operation. The government of Nova Scotia undertook at the same time to aid the enterprise of the Halifax and Cape Breton Railway and Coal Company in money. In the assistance which it gave, the Nova Scotia government disbursed actually a sum exceeding $670,000. It was stipulated then by that agreement-which is known in the correspondence as the tripartite agreement-that after the completion of the road by the company, which afterwards became the Eastern Extension Company, if that company failed to operate the road and equip it and build a ferry at the Gulf of Canso, then the ownership should be forfeited to the government.
Let me call the attention of the House to the fact that it was stipulated between the two parties that, in the event of the company failing to carry on the undertaking and operate the road, then its right in the road would be forfeited to the government. But, I want the House to understand that 1854
it was the government of Nova Scotia which was to become the owner of that valuable piece of road, should it be forfeited, and that government undertook to subsidize the company to the extent of $670,000 and more- in fact, to an extent exceeding $8,000 per mile. The road was built, and it became evident that the company could not operate it, and the company agreed to transfer the ownership to the province of Nova Scotia. The Dominion government, of course, consented, as had been agreed on the 1st of October, 1883, to the government of Nova Scotia taking possession of the road and operating it for its own benefit and advantage. Dp to that time all the agreement had been carried out except this, that the government of Canada was still in possession of the road between Truro and New Glasgow, but it was part of the agreement that on the 1st of October, 1883, when the province of Nova Scotia was to become proprietor in fee simple of that section of the road which had just been completed between New Glasgow and the Gulf of Canso, that province was to become also-under the terms of the agreement of 1877, ratified in 1879-proprietor absolutely of the section of road between Truro and New Glasgow. If that agreement had been carried out as stipulated, the province of Nova Scotia would have become owner and proprietor on the 1st of October, 1883, of the full extent of the road from Truro to the Gulf of Canso.
But on the 1st of October the government of Canada failed to comply with the conditions of the agreement, to which it had consented three or four years before ; and on the 20th of October, 1883, the government of Canada passed an order in council declaring its intention of complying with the agreement, but imposing on the province of Nova Scotia conditions which were not stipulated in the Act of 1879. The new conditions on which it declared itself ready to hand over the road to the Nova Scotia government were two. First, that Nova Scotia should not have control of the tariff, but that the tariff should be based on the tariff of the Intercolonial Railway. The second was that Nova Scotia should provide at once a stated amount of rolling stock, without any regard to the condition of the road. These conditions appear to have been imposed for the purpose of making it impossible for the government of Nova Scotia to acquire the railway, as was stipulated in 1877 and again in 1879.
The government of Nova Scotia could not comply with these conditions, and it had to abandon the vested right it had under the agreement, made some few years ago- in 1877 and 1879-between it and the Dominion government. The Nova Scotia government protested against the conditions imposed upon it by the government of Canada, protested against the government of Canada using its authority to prevent the Nova Scotia government from taking the

advantage which had accrued to it by the terms of the agreement under which it had paid the sum of $670,000. There is one point which I wish at once to press upon the attention of the House. The province of Nova Scotia at that time was not in the sound financial position in which it is today, and this undertaking was one, I may say, which was beyond the legitimate power of the province at that time-the aiding of such a road to the extent of $8,000 a mile. There have been many governments that have aided enterprises of this kind, but there has been no provincial government that has found it possible to aid a railway of that description to the extent of $8,000 a mile. And I can safely say that the province of Nova Scotia never would have dared to assume such a liability had it not been for the condition stipulated and ratified by two Acts of parliament, that, in the event of forfeiture, the ownership of the road would revert, not to the Dominion of Canada, but to the province of Nova Scotia. When the Dominion government practically took possession of the road in spite of the agreement it had with the government of Nova Scotia, I have no hesitation in characterizing its act as an absolute breach of faith. The government of Nova Scotia protested at the time, and it has kept on protesting ever since. When we came into power five years ago, we found that claim against the Dominion government still pending, though the government of Nova Scotia had pressed for recognition of its rights again and again. Its legitimate voice had never been heard and this unsettled claim was a sore rankling in the breast of the people of Nova Scotia. We thought it was not for the good government of Canada that such a claim should remain unsettled. So, we deemed it best, under the circumstances, to refer the claim to arbitrators for investigation and settlement upon the grounds of equity and justice. We selected as arbitrators gentlemen of the highest character. However we may differ as to the other conditions of that claim, there can be no doubt whatever as to the qualifications of the arbitrators. The first was Chief Justice Burton. I need but mention the name of Chief Justice Burton to make it unnecessary to qualify him. He is one of the most eminent jurists and the most conscientious and hhle judges that have adorned the bench of Ontario, which has been prolific of good men. The second arbitrator was a gentleman who has since become a member of this House, and who has attained quite a standing in it. I refer to our hon. colleague from Annapolis (Mr. Wade). The third arbitrator was Mr. Barbeau, one of the leading bankers of Montreal, a gentleman, perhaps, not well known to the members of this House, but well known in the city of Montreal; and none who know him will hesitate to give Sir WILFRID LAURIER.
him the highest qualification in his profession, not only as an eminent banker, but as a man of sterling honour and integrity. The arbitrators came to the conclusion that the province had suffered damages by the breach of contract on the part of the Dominion government, and was entitled to compensation. The only question in their minds was the amount of compensation to which the province was entitled. I may say, before going further, that the arbitrators did not hesitate to say that, in their opinion, the Dominion was absolutely warranted in its action in 1883, when it forced the province of Nova Scotia to forego the rights which had accrued to it through the bargain between the province and the Dominion. Let me, on this point read the views of the arbitrators :
But there is evidence which would warrant us in concluding that these conditions which were contained in the order in council of the 20 th October were not the true reasons for adopting the course then taken. A very short time previously, the Minister of Railways, when the province was about to raise funds to pay for the railway, gave the provincial authorities the most unqualified assurance that the Truro branch would be handed over, and yet we find the same minister, when the time had arrived for fulfilment of the promise, stating in parliament that the government had made up their minds that this road should not be disposed of. The true reason would rather seem to be that which was stated by the same Minister of Railways in his place in parliament, who, after referring to its vast importance to the coal mining industries and its important connection with the transport of coal and the coaling of steamers at the port of Halifax and from a variety of causes stated, it was found that it would be attended with great inconvenience and disadvantage, and that in fact parting with it would to a large extent dislocate the railway system as it had been carried on, and in another place he said it was the key of the Intercolonial situation, being the entrance to the coal fields, adding ' We have a splendid thing, and it would be absolutely impossible for us to give it away.'
So, the arbitrators found that the reason why the government of Canada did not carry out the contract it had made with the province by which the province would have become, and would to-day be, the owner of the road from Truro to the Gut of Canso, was that the government of Canada thought it better to keep the railway for themselves, and as it was put at the time- as they had a good thing in their hands they wanted to keep it. In the face of such a condition of things, is it not manifest that the province of Nova Scotia has been unfairly dealt with, and is entitled to compensation ? The province of Nova Scotia burdened itself with a loan in order to aid the construction of that railway. This she did in the full expectation that if the enterprise was not carried out by the company, and if forfeiture took place, the road would revert to the province, and the province would have this big asset of 120 miles of

railway between Truro and the Gut of Canso in one of the most important sections of the country. The government of Canada thought that instead of allowing the province of Nova Scotia to become the owner of that road it should keep the ownership for itslf. So, the arbitrators have come to the conclusion that the province is entitled to fair compensation, and it finds that that fair compensation is the amount they contributed to the road, that is, $071,000. These being the facts, it seems to me that the government of Canada is only fulfilling its duty in doing now what should have been done eighteen years ago. No. I should not say that, for we cannot do what should have been done eighteen years ago. There is no question before us now of the province of Nova Scotia becoming the owner of that road. But it is only fair that we should repair the mischief that has been done so far as lies in our power, and should compensate the province of Nova Scotia for the expenditure it made at that time, of the benefits of which it was deprived.
Some days ago, I heard my hon. _friend from South Lanark (Mr. Haggart) make the observation: When is there to be an end of this bringing of claims by the provinces against the Dominion ?	1 have no hesitation in saying that if we make contracts as has been done in this case with a province, and claims arise out of those contracts, those claims must be adjusted. If the Dominion government had not entered into a contract with the government of the province of Nova Scotia, there would have been no claims. But the Dominion government went out of its way to make a contract with the province; a claim has arisen out of that. Shall we say that this claim shall not be recognized ? Why should it not be recognized ? Why should a government be more exempt from liability than an individual ? Is there any law, human or divine, why a government should not be responsible for its laches ? I submit to the sense of fairness and justice in the breast of every man, that the government cannot, under such circumstances, say that there is no legal claim. Sometimes another thing has been done, sometimes a claim has been ignored, or it has been settled according to the views of the Dominion government, without regard to the views of the local government. Whenever there are claims of that kind, if you wish for a settlement which will be final, or, as Mr. Blake said, ' finally final,' the only way to get it is to have a compromise between the parties by a judicial arbitration. Take the case of Prince Edward Island, which was disposed of a few days ago. That claim is settled now for ever, you will never hear of it any more. My hon. friend shakes his head-I will give him the reason why I say so. A claim was presented by Prince Edward Island against
the Dominion government about fifteen years ago. In 1885, the Dominion government, having ignored the claim, Prince Edward Island carried its complaint to the foot of the Throne, to the Imperial authorities. The Imperial authorities referred it to the Canadian government, with an intimation that the claim ought to be settled. That claim has been pending ever since, but, we have now settled it, and the settlement will be ' finally final,' because we have made an agreement with the province of Prince Edward Island under which they will accept the sum that we have given them as a full settlement of the claim, and they have given us a quit claim, and have placed it on record in their legislation.


Mr. CLANCY.: The right hon. gentleman was told by two representatives from Prince Edward Island that it was not a settlement.


The PRIME MINISTER.: I was told on the floor of the House, by two gentlemen who represent Prince Edward Island, that, in their view, the amount of money paid is not sufficient. But, while those two gentlemen from Prince Edward Island have told us that the amount is not sufficient, the legislature of Prince Edward Island has solemnly passed an Act whereby they discharge us of any further claim upon this ground. Nothing could be more final than this, you have an Act of the legislature itself.


Mr. HACKETT.: Does the hon. gentleman refer to the future as well as the present ? Does that cover all claims for the future ?


The PRIME MINISTER.: It covers all the claims which have arisen out of the nonfulfilment of the terms of union.


Edward Hackett: Past, present and future ?


The PRIME MINISTER.: Well, I fear I cannot answer my hon. friend as to that. If my hon. friend is going to look to the future, I am afraid there is no tribunal in the world that could satisfy him ; I will refer him to the day of judgment for that. But, I mean to say for the past, and up to this year 1901, all the claims Prince Edward Island had against this government arising out of the nonfulfilment of the terms of union, have been settled, and the settlement has been sanctioned by the legislature of Prince Edward Island. In the same way In this case. I wish to say to my hon. friend from Lanark (Mr. Haggart), that this claim for which we now ask an appropriation, will be absolutely settled, settled for ever, because the province of Nova Scotia has agreed with us to refer the claim to arbitration, and evidently, when two parties go to arbitration the award is a final settle-

ment of the claim. When the hon. member for Peel (Mr. Blain) was speaking of the claims of Manitoba with reference to the Canadian Pacific Railway, and wnen he said that every year a new settlement had to be made, there was a reason for it, because the government of that day never took the precaution to have a judicial arbitration or to have an Act of parliament. But, here we have taken the precaution to have a judicial arbitration. The province of Nova Scotia has agreed to refer this claim to three arbitrators, the award has been pronounced, and when the money is paid the claim will be for ever settled.


Hon. Mr. HAGGART.: I think there is one fact which has not been mentioned. The government of Nova Scotia was a consenting party to the transfor of this portion of the road from New Glasgow to the Gut of Canso. and made as a condition an extension of the road in Cape Breton.


The PRIME MINISTER.: The government of Nova Scotia never was a willing party to anything of the kind. She was forced to give her consent, she was powerless in the hands of the Dominion government, and only accepted under protest that arrangement, asserting that she had been deprived of the rights which had accrued under the contract ratified in 1879. I submit to the committee that it is not conducive to the welfare of the Dominion that there should exist claims of that kind against the Federal government on the part (of any of the provinces. We want every province to feel that it has received the justice to which it is entitled. On that ground I ask parliament to vote this money for the settlement of that long pending claim. I am satisfied that the committee, at all events a majority of it. will come to the conclusion that it was a wise action on the part of this government to settle the claim in this manner.


John Graham Haggart: The right hon. gentleman has stated his case very clearly. According to my remembrance, I had some communication with the Nova Scotia government in reference to this particular claim, and I remember submitting it to the Minister of Justice, who had been premier of the province, Sir John Thompson. It is true, as the right hon. gentleman says, that we were in possession of a line of road from Truro to New Glasgow, and that the Nova Scotia government were very anxious to extend that road from New Glasgow to the Gut of Canso. offering to furnish a ferry to cross the Gut. They made arrangements with some company to secure the building of that road, giving them some assistance to extend it. I believe they expended over $670,000. There was a tripartite agreement entered into between the railway company which was constructing that road, the Dominion government, Sir WILFRID LAURIER.
and the Nova Scotia government, under which agreement the Dominion government were to give over to the Nova Scotia government this section of the road after it was built, and upon certain fixed terms. The Dominion government properly made it a condition, before handing the road over to the Nova Scotia government, that the latter should have material enough to work that branch, because it was essential, not only in the interest of the Dominion, but of the province of Nova Scotia, that the line from Truro to New Glasgow should be efficiently worked, and that from New Glasgow to the Gut of Canso should be efficiently worked ; and the Dominion government' retained, as they ought to retain, the right to approve of the tariffs to be charged over that road. That is a peculiar right which is vested in the Dominion.


Mr. FRASER.: Does the hon. gentleman mean to say that if the local legislature gives a charter to a company and the company runs a road, that the Dominion government has a right to say what the tariff will be, and not the local government ?


John Graham Haggart: That was the agreement with them.


Duncan Cameron Fraser: That is what the Dominion government wanted to do.


John Graham Haggart: That was a part of the agreement when the Dominion handed over to the local legislature the road from New Glasgow to the Gut of Canso. The fact of the matter Is, that the Nova Scotia government were not in a position to put rolling stock upon the road. They had expended the whole of the credit of the province in getting the part from New Glasgow to the Gut of Canso constructed. It was a valuable asset to them. If they had been compelled to run the road, not only would they have lost the amount of money which was requisite to put rolling stock on the road, but. they would have been subjected to a continuous loss in working the whole road. That was the position of the province at that time. It was a worthless asset to the province, and. as I understood him, the right hon. leader of the government said that there is no correspondence in the direction which I state. I have a recollection that there was some correspondence between the Nova Scotia government and the Dominion government 'at that time on the point of their taking over this particular portion of the road and building a ferry at the Gut of Canso, and on the promise of the extension of the road through Cape Breton to Sydney, the Nova Scotia government would very willingly vest their claims in this particular undertaking in the Dominion government.


The MINISTER OF FINANCE.: Did the government assent to that ?


John Graham Haggart: I think they did, and I think they performed that part of the agreement with the province ?


The MINISTER OF FINANCE.: They refused to.


John Graham Haggart: That is a subject to which I drew the attention of the right hon. gentleman, and which he carefully avoided, and which I do not think has been presented to the arbitrators. Now, the hon. Minister of Finance, in defending this arbitration the other day, stated that he had followed the lines exactly that were followed in the settlement between Ontario and Quebec and the Dominion government. I cannot understand the similitude. The hon. gentleman must remember that the whole matter was explained in parliament and that parliament was asked to give authority to the executive to give to these arbitrators the right to go past the legality of the transaction and to inquire into the equities of the case at that time between Ontario and Quebec and the Dominion. What were the facts of the matter ? In that arbitration between Ontario, Quebec and the Dominion, there was to be taken into consideration the interest on a certain sum that had been due from the old province of Canada to the province of Ontario. The interest on that amount was retained from the subsidies due to the different provinces. That amount was afterwards assumed, under the Act of 1884, by the Dominion government, and in order to return to the different provinces the amount of money to which they were entitled in the form of interest which had been deducted from the subsidies, the claims of the two provinces had to be decided. The equities were on all sides, with the Dominion, and with the provinces, but in this case the equities were entirely upon one side, on the side of the province of Nova Scotia. The difference between the plan adopted by us and the plan adopted by hon. gentlemen opposite is this : We heard nothing of this claim being settled. The hon. gentlemen opposite took it upon themselves by order in council to frame regulations under which this case was submitted to the arbitrators. As to the legality of the claim of Nova Scotia there is no doubt whatever that there is no legal claim. The right hon. leader of the government must know that, because he has the evidence of it in the Department of Justice. The case was submitted to the late Sir John Thompson and to different Ministers of Justice, and they advised the department over which I had the honour to preside, the Department of Railways and Canals, that Nova Scotia had no legal claim. Having no legal claim, the duty of the government was to come and explain the facts of the case to parliament, and get an Act of this parliament for the purpose of submitting the equities to a court to decide upon them. The hon. gentleman says that there will be no finality, and that
I was arguing that when a province has a claim against the Dominion it should not be entertained. I did not make any such argument as that, but my argument was that the claims of the provinces, having been settled from time to time by different subsidy Acts, you have no right to go past these Acts for "the purpose of fishing up what may or not be a claim against the Dominion government. In the Prince Edward Island case, the first subsidy Act was revived by an Act of 1873, and it was revived again by an Act of 1884, by which there was a general settlement of the subsidies to which the different provinces were entitled. By a special Act afterwards, Prince Edward Island was given $20,000 per year, which was added to the subsidy to be given to that province. My argument was this : Is it not probable, is it not likely, that all the claims of the different provinces were settled up to the time that the increased subsidies were granted ? What I stated was that where there has been an increased subsidy from time to time given to the different provinces and where the amount to which they are entitled has been fixed by a subsidy Act, these claims, which existed for years before that subsidy Act was passed, were wiped out by the sub-isidy Act. I admit that a claim through a contract might occur between the Dominion government and the province after the subsidy Act had been passed, which might entitle the province to claim against the Dominion government, and that it might be submitted to arbitration for the purpose of deciding upon it. But, first of all, I think authority should be obtained from this parliament to submit the case to the arbitrators. The distinction, then, that I draw between the course which has been pursued by the hon. Minister of Finance in this case and the course we adopted in 1883, as to the settlement of the claims between Ontario, Quebec and the Dominion, is such as to demonstrate that there is no parallel whatever. In this case, in regard to the legality of the claim, there is no doubt about it that we are not entitled to give the province of Nova Scotia anything. I may be mistaken in the statement I make, but I believe that the province of Nova Scotia was a consenting party when the Dominion of Canada acquired possession of that particular section of the road, and that the conditions were that they should operate the road and work the ferry across the Gut of Canso and build the road through Cape Breton to Sydney.


James Clancy: This is one of the questions that the House in committee must naturally shut their eyes to. The committee must vote blindly on a question that they had little time at their disposal to unravel, and they must rely mainly on the statements that are made by those who take the responsibility of introducing this measure. Any one w'ho has taken the trouble to inquire into it must have been greatly amused at the light in which the right hon. leader of the
I

government (Sir Wilfrid Laurier) placed the case. The right hon. gentleman stated as one ground for the claim that the Dominion government had practically with force taken possession of the road. I took down the right hon. gentleman's words and X do not wish to torture them into any other meaning, because if the right hon. gentleman intended to convey that meaning, it is very important indeed.


The PRIME MINISTER.: I stand by what I said.


James Clancy: I have no doubt that the right hon. gentleman has relied mainly upon the award rather than upon having looked carefully into the evidence itself.


The PRIME MINISTER.: I will give my authority. My authority is the hon. member for South Lanark (Mr. Haggart). I stated that while the government of Canada should have handed over the road to the province of Nova Scotia on the 1st of October, 1883, they passed an order in council on the 20th of that month, stating that they were ready to hand over this piece of road to the province of Nova Scotia on the condition that the province would equip the road with a certain amount of rolling stock. My hon. friend from Lanark stated a moment ago that this exhausted the credit of Nova Scotia, and that it was not in a position to equip the road in the manner forced upon it by the government of Canada.


James Clancy: That explanation modifies the statement previously made by the Prime Minister, to the effect that the Dominion government forced Nova Scotia into that position knowing at the time that Nova Scotia was financially embarrassed. I was not aware that it was the duty of the Dominion government to be guided by the financial position of a province, but I have to say that Nova Scotia never wanted that road for the reason that the province was financially embarrassed. The Dominion government imposed the rates and the province said that these rates were too low, and that under them they could not make the road pay. The answer of the miners of Nova Scotia was that it was a question whether there should be high rates, or whether the coal should be carried at sufficiently low rates to develop the mines, so that the money might go into the pockets of the people, rather than that the high rates should go into the provincial treasury. It is quite true that the pretense was set up at one time that Nova Scotia did require the road, but in 1884 when the Prime Minister of the province was justifying the action of the government of which the hon. gentleman (Mr. Fielding) was a distinguished member, this is what the Hon. Mr. Pipes had to say with regard to the bargain made with the Dominion government:


James Clancy: It will be remembered that when I was in Ottawa in December of 1882, I offered the Dominion government this railway if they would pay the Allan Company's outlay, take over the Eastern Extension, and give the province the right within two years of taking the roads hack upon paying the Dominion government the amount they would be called upon to pay the Allan Company. That proposition was not accepted. When I made it I thought that two years would give the people of this province a full opportunity of considering the advantages of having their roads operated _ by the Dominion government, and In that time it would be found to be a policy so advantageous to the province that the legislature would not be willing to take the roads out of the hands of the government.
His contention was that if they could have induced the Dominion government to take hold of the road, to pay the Halifax and Cape Breton Coal Company their outlay, and to operate the road for two years, the people of Nova Scotia would have been thoroughly convinced that it was in the best interests of the province that the road should remain in the hands of the Dominion government. It had been said that the Dominion government had forced a hard bargain, that the province was compelled to yield, and that the exhorbitant demands made by the Dominion government both as to the additional rolling stock and as to the rates, might end in a legal contest. But this is what the present Minister of Finance, speaking in the Nova Scotia legislature, had to say on that point:
But. suppose the government had succeeded, there were victories which were worse than defeat, and when he looked carefully into the figures connected with the matter, he was Inclined to question whether success in a contest with the Dominion government might not have been more disastrous than failure.
In other words, if the province succeeded in the courts, the victory over the Dominion would be more disastrous than if the province failed.
Taking the cost of the road and the amount to be expended in repairs at $1,500,000. that would have involved an annual charge of $75,000. Mr. Scott said that with a fair tariff the government could realize $60,000 from the branch and $10,000 from Eastern Extension. Suppose that the government had done better than this and made $75,000. In that case, they would have made both ends meet, but what gain would it have been to the people of Cape Breton or Yarmouth or Digby for the government to go on with an enterprise which at the utmost would only have paid annual interest, and when the rates could not be increased without Imposing taxation on the people of Colchester, Pictou and Antigonish, and seriously affecting the coal trade? That being the case, they thought it better to come to an arrangement with the Dominion government. He (Hon. Mr. Fielding) was not willing to fight when he saw there was nothing to fight for. The estimates in regard to the value of the Pictou branch were made at a time when people were disposed to take a rose-coloured view of things. For himself, he had never entertained a high opinion

of the calculations, especially as they were prepared in the interests of the syndicate. He thought it best, therefore, to get rid of the property in such a way as to leave the province free from loss. Everything that the government could have accomplished by the policy of taking over the road had been accomplished by the policy before the House without any of the disadvantages of the former policy.
Can language he plainer than that ? The Minister of Finance (Hon. Mr. Fielding) plainly announced that it would have been idle to have gone into the courts to contest with the Dominion government as to whether they'were taking a proper course with regard to the rates or to the rolling stock, because, as he told the people he so ably represented in the legislature, if they succeeded in a suit of that kind it would be disastrous to the province. The hon. gentleman states that the road would no more than pay its expenses with the advanced rates. The hon. gentleman states that even under circumstances of that kind, if the public purse were served, the people would have to suffer correspondingly ; and that therefore everything that could be accomplished by taking the road over from the Dominion government was accomplished by the settlement made with the Dominion government. But another distinguished gentleman had something to say on the subject in the Nova Scotia legislature, that was Mr. Dongley, at present, I believe, the Attorney General of the province. This is what he had to say during the same debate :
Hon. gentlemen opposite had charged the Dominion government with forcing this province to accept this bargain, as if that was anything to boast of. But he was going to show that this government was not forced into the bargain. He stated boldly that he believed that if at any stage the Dominion government had offered to give the local government the branch on their own terms, he believed this government would have subserved the interests of Nova Scotia by handing over the two roads on the same terms on which they did hand them over. But Mr. Longley went further. He said :
Instead of this bargain being forced upon them by the Dominion government, it was forced upon the Dominion government by the local government, who placed the whole subject before them in so clear a light that they dared not impose upon us. Hon. gentlemen might smile, but he said they forced upon the Dominion government a bargain which had been proved to be advantageous to the interest of Nova Scotia.
Mr. Longley. the present Attorney General of the province of Nova Scotia, was one of the eminent counsel employed at the arbitration. But another gentleman of high standing in the province of Nova Scotia made a speech since this award was made -Mr. E. M. Macdonald, whom I imagine the hon. Minister of Finance knows very well. This award was made on the 19th of July, 1900, and Mr. Macdonald, who was also one of the counsel on behalf of Nova Scotia, made a speech in the legislature on the 26th of March, 1901, in which he said :
While this transfer was inadequate as regarded compensation, yet it had one important advantage to the province. It was l-ecognized that those who justified the transfer on the ground that it was more >in the interest of the province of Nova Scotia that the Dominion government should control this railway, spoke correctly and that they laid down a policy that history had justified.
Now, we have in a nutshell the attitude of hon. gentlemen opposite. I think I might well sit down after calling as witnesses these gentlemen whom I have quoted. I have pointed out that a distinguished member of the legislature, who was engaged as counsel before the arbitrators, has declared that the policy which was pursued in 1881 by the province of Nova Scotia was a wise policy, and the best thing that could be done. We have Mr. Longley declaring that the Dominion government had not forced the province, but that the province had forced the Dominion government. We have the Minister of Finance contending that nothing was contended for, but that everything that could be obtained for the road was more than obtained if the Dominion took over the road. I challenge the Minister of Finance, who is well acquainted with the subject, to say that Nova Scotia has sustained a loss. If Nova Scotia has not sustained a loss, where is the claim ? There is absolutely no claim. Nova Scotia has no more right to come in and make that claim for the sums which were paid by the legislature towards the construction of that road than the province of Ontario has to claim from the Dominion seven or eight million dollars which have been granted by the local legislature to railways in that province. No hon. member of this House will pretend to draw a distinction in favour of any province because it granted a subsidy to a road which became part of the Intercolonial. If there were any reason why subsidies should be returned to a province, there would be the greater reason where the subsidies were granted to roads which are not government roads, and why ? For the simple reason that the Intercolonial is maintained entirely out of the public purse, while the provinces and municipalities have struggled to give subsidies to railways from one end of Canada to the other.
I have scanned hurriedly the aid that has been given to railways by the Dominion government, and I am sure it will be instructive to the House to see how it stands at the present time. The whole sum that has been given appears to be in round numbers $150,000,000. Of that sum $56,000,000 was given to the great trunk line, the Canadian Pacific, and $60,000,000 to the Intercolonial : and the total sum given to all other railways in Canada amounts to only $33,000,000 or $34,000,000. In other words, the Intercolonial Railway has had spent on capital account nearly twice as much as all

the other railways in Canada, excluding the Canadian Pacific Railway, which is a road that concerns all Canada. Ndw, Sir, what state of things is that ? The Intercolonial Railway was built mainly in the interest of the maritme provinces, and they have derived most of the benefits of that road. The Dominion ti*feasury has been taxed and bled, and it has a right to be taxed and bled, because the Dominion made that bargain and should live up to it faithfully, no matter what the cost may be. It is too late in the day now to attempt to repudiate it; but I ask if it is fair for the province of Nova Scotia time and again, whenever it suits it, to come here and make a claim on so flimsy a ground. I ask hon. gentlemen from the province of Quebec: Are you going to claim the $300,000 that was given by your province on precisely the same terms to the Drummond County Railway? Are the people of Ontario going to make claims of a similar kind ?
We are told to-night that this has legislative sanction in Nova Scotia. But that does not mean anything. It means simply that the legislature of Nova Scotia will be bound by its sanction so long as it does not feel disposed to put forth a new claim. What we desire above all things, and what I am sure the Minister of Finance would like to see, is finality. The Finance Minister was one of the contending parties in the Nova Scotia legislature. He took an important part in the negotiations and he accepted the sum then paid over to the province, which covered every outlay of the province in the matter. That was paid and that should have put an end to all demands. Why did he not stand by the bargain they agreed to ? What followed ? The hon. gentleman submitted himself to be dragged in as a witness in a case against the Dominion treasury of which he is the custodian. There has not been any evidence produced to show that the province sustained any loss. If it could be shown that by reason of the action of the Dominion government, Nova Scotia had sustained a loss, we could understand her advancing a claim to be recouped, but there is absolutely no claim made on that ground. With regard to the arbitrators, no one questions their respectability, but there are no judges or arbitrators so respectable that their judgments may not be appealed from. And this is an appeal to parliament not to sustain a decision that is destitute of every feature which would warrant the payment of a cent. As my hon. friend from South Lanark (Mr. Haggart) has very well asked : Where are we going to stop ? Why, the province of Ontario, on just as sound a basis, might come forward to-morrow and claim the subsidies paid by that province, amounting to $7,000,000, and the bonuses given by Ontario municipalities amounting to some $9,000,000, from this government. We are now asked to pay $670,000 for the principal, and later on we will have a demand for the Mr. CLANCY.
interest ; and because we passed an Act in 1882 declaring that all railways, under certain conditions, were for the general advantage of Canada, -we will have a raid on the Dominion treasury by the provinces to be recouped for the subsidies they gave these railways. I have no hesitation in saying that this claim has not a redeeming feature in it. From start to finish, the province of Nova Scotia has never claimed that it sustained a loss. We may well despair of the future of this country when we find that it is not possible to make a bargain with any province which that province will stand by.


The SOLICITOR GENERAL.: I can see absolutely no analogy between the position of Nova Scotia and these arbitrators and the ease of any other province arising out of subsidies given to enterprises which were subsequently declared for the general advantage of Canada. Let me briefly state the facts which gave rise to this arbitration, so that we may understand what the difficulty was. When the House understands the facts involved and is not led away by side issues, which have no bearing on the question in hand, hon. members will see that the claim submitted to the arbitrators was a perfectly legitimate one. In 1874, and some years previous, there existed in Nova Scotia' a line of railway extending from Truro to Pictou. On the 19th May, 1874, a resolution was passed in the House of Commons declaring the railway from Truro to Pictou to be under the control of the Dominion government.


Mr. WALLACE.: Does the hon. gentlemau meau that the Dominion government had issued a charter ?


The SOLICITOR GENERAL.: The Dominion government owned the road. The railway came into existence previous to confederation. This particular branch was the property of the Dominion government. In 1874 a resolution was passed in this House which reads :
That the government be authorized to negotiate, during the parliamentary recess, for the transfer of the railway from Truro to Pictou to some organized company, on condition that such company will extend the said railway from New Glasgow or Pictou to the Gulf of Cans'), or some place in Cape Breton, within a specified time, and such transfer be subject to the approval of parliament at the next session.
What does that mean ? It means that in order to induce a company to construct a railway from New Glasgow to Port Mulberry, in the Gulf of Canso, the Dominion parliament undertook to transfer its branch from Truro to Pictou to the new company. Not only was that resolution passed at that time, but subsequently the province of Nova Scotia, interested in the construction of this piece of road from New Glasgow to the port of Mulgrave, entered into a contract with a man named Abbott, who, at

that time, was acting for the Halifax and Cape Breton Railway and Coal Company, for the construction of this road. That contract was entered into on the 31st October, 1876. And, in 1877, the matter came before this House, and, by statute, 40 Victoria chapter 46, the contract entered into between the province of Nova Scotia and this company was ratified by this parliament. By the Act passed at that time, it provided :
The Pictou and Truro Branch Railway, including sufficient land for the purposes thereof, and the stations and buildings thereon necessary for the use of the railway, but without any of the rolling stock, shall be transfered absolutely to the person or the company constructing the fine from New Glasgow to the Strait of Canso, and providing a proper steam ferry across the strait, as soon as such railway is constructed, with proper rolling stock and other appurtenances, and such ferry provided to the satisfaction of the Minister of Public Works.


John Graham Haggart: Is that authority for a transfer or does that confirm a transfer ?


The SOLICITOR GENERAL.: It confirms an agreement entered into between the province of Ontario and this ''company to construct this road from New Glasgow to Port Mulgrave. The Dominion government becomes a party to that contract, because it undertakes to say to the contractor : If you will fulfil your obligation to the province of Nova Scotia and construct this road, we will transfer to you the line from Truro to Pictou. The contract proceeded. And then, in 1879, we have another step in the proceedings, a step to which the Dominion government becomes a party. And I would point out to my hon. friend from Bothwell (Mr. Clancy) that there is no comparison between this case and the case to which he refers. This is a case that must stand on its own merits ; it is a distinct case of breach of agreement on the part of the Dominion government. On the 1st of February, 1879, a tripartite agreement was entered into. The Dominion government, the provincial government, and the railway I have first spoken about are the parties. And by this agreement it is provided that the contractors are to build what now becomes the Eastern Extension Railway, and it constitutes an obligation of the Dominion as to the transfer, and by which it was provided that the Truro branch should be retained by the Dominion government until the Eastern Extension Railway ito the Gut of Canso and the steam ferry across the strait should be completed, equipped and established, in accordance with the existing contract or any modification thereof that might be agreed to by the company and the Nova Scotia government, to the satisfaction of the Nova Scotia government, and that upon such completion the absolute right of property in the said Pictou branch should be conveyed to the company on certain terms. Now, the terms were fixed at that time by the solemn agreement
then entered into. Thus, the Dominion government was bound, on the performance by the contractor of certain conditions, to transfer this Pictou branch to him. Things 'went on from 1879 to 1882. In 1882, the contractor, not proceeding with the work as he should have done, it was found necessary by the Nova Scotia government to draw the attention of the Dominion government, the other party to the agreement, to the unsatisfactory progress made by the contractor. As a result of the representation made by the Nova Scotia government, the matter was referred to the then Minister of Public Works, and it comes before him. The parties were heard ; the delay for finishing the road was extended from 1st of March, 1882, to 1st of October, 1883. That delay expiring on the 1st of October, 1883, it was within the power of the Nova Scotia government, upon recouping to the Eastern Extension Railway a certain amount that they had been obliged to spend, to enter into possession of the Eastern Extension Railway and the Pictou branch.


James Clancy: Upon what condition ?


The SOLICITOR GENERAL.: Under the conditions fixed in the tripartite agreement. The conditions were, that if the contractors did not carry out their agreement by 1st of October, 1883, then the Nova Scotia government entered into possession of the road, the Eastern Extension Railway, and entering into possession of the Eastern Extension branch, they became entitled to possession of the Truro-Pictou branch.


James Clancy: But only when they had complied with certain conditions ?


The SOLICITOR GENERAL.: Complied with the conditions settled with the contractor.


James Clancy: No other conditions ?


The SOLICITOR GENERAL.: My hon. friend (Mr. Clancy) has never read the contract. The delay expired on 1st of October, 1883. The Nova Scotia government took the steps necessary to pay the contractor for the Eastern Extension, so that they might be entitled to get possession of that portion of the road. It then remained to decide how far they might get possession of the Truro-Pictou branch, which was still in the possession of the Dominion government. But, the Dominion government say to the Nova Scotia government: It is all right; get possession of the Eastern Extension-the Dominion government could not prevent that, because it was a local concern under a local charter. If they had done that and entered into possession of the Eastern Extension they would have had a railway that began nowhere and ended nowhere-began at New Glasgow and went on to Port Mulgrave.


Robert Laird Borden: Does my hon. friend (Mr. Fitzpatrick) say New Glasgow is nowhere ?


The SOLICITOR GENERAL.: From a railway standpoint.


James Clancy: Did the province enter into possession of the road ?


The SOLICITOR GENERAL.: If my hou. friend will permit me to go on, I will explain. The Federal government said to the' local government : Take the Eastern Extension. And the local government did take it. But, the provincial government said : Comply with the rest of the bargain, and give us the rest of the extension from Truro to Pictou. They delayed until the 20th of the month, and then they said : We will give you the Truro and Pictou branch. But, they provided the terms and conditions under which the transfer was to be made. But the terms under which that transfer should have been made were fixed by the tripartite agreement of February 18th, 1879, and they ought to have left it to that agreement, and they ought to have handed over the road on those terms.


James Clancy: The province took over the road and received the Pictou branch, on condition that they were to operate it efficiently as stated there, and that the rolling stock were to be put on, and the tariff should be the tariff of the Intercolonial Railway.


The SOLICITOR GENERAL.: I will read the conditions, and the hon. gentleman will see how near it is to the statement he has made :
That the company, after the completion of the road, should efficiently and continuously operate both lines to the satisfaction of the Lieutenant Governor at a fair and reasonable tariff of charges, which should be made and established by the company, subject to the approval of the government of Nova Scotia, and which should be only altered or amended with the assent and approval of that government, and any difference of opinion as to any item of such tariff should be submitted to the Minister of Public Works of the Dominion as a referee, whose decision should be final and binding.


James Clancy: Hear, hear.


The SOLICITOR GENERAL.: I am afraid my hon. friend does not understand the point I am making. This was done under the agreement of 1879, but when, in 1883, the province asked to have the road handed over, the Dominion government changed the conditions so as to provide for the fixing of the rates by the Federal government and not by the local government, and also that the equipment should be such as was decided by the Federal government Now, I am not going to ask the House to take my construction of this modification of the lagreement. I am going to ask the House to take the construction put upon that modification by the arbitrators, from a legal Mr. FITZPATRICK.
standpoint. Here is what the arbitrators say, dealing with the order in council of October 20th :
It treats the road and ferry as not having been built, it then imposes two conditions which we have no hesitation in saying were unwarranted under the Act of parliament, and wholly illegal.
Now, the House may decide on this question of law between the opinion of the Chief Justice and the opinion of my hon. friend from Bothwell. That is the position of affairs at that time. The Federal government at that time used such duress with respect to the province of Nova Scotia, they placed that province in such a position that it was impossible for it to do otherwise, unless it was willing to have the whole road they had endeavoured to get constructed, obliged to submit to the terms they had imposed upon it.	,


James Clancy: I am afraid the hon. gentleman is casting a serious doubt on the veracity of the respectable gentleman -who contended the other way in the province of Nova Scotia.


The SOLICITOR GENERAL.: It is not on the veracity of the hon. gentleman I reflect at all, it is upon the construction put by my hon. friend upon what he said. 1 beg to differ with him. I do not want to take my construction from my hon. friend, however adroit he may be in some things ; and I am not called upon to discuss the question of the veracity of the Minister of Finance, because he having testified there is no man in this country who will doubf his veracity. Now, the position was at this time that the province of Nova Scotia had expended, in connection with the construction of the Eastern Extension road, a very large sum, and the Dominion government, notwithstanding the solemn contract they had entered into to hand over this road as a consideration to induce the Nova Scotia government to make this expenditure, when they have them in a hole, and when they find that Nova Scotia is saddled with this enormous liability, they say to them : Keep that Eastern Extension and do as you please with your portion of the road, or give it to us and we will give you $1,200,000, over $700,000 less than had been expended upon it. Under these circumstances Nova Scotia submitted, and from that day to this Nova Scotia has continued protesting against the bargain. Finally the matter was referred to arbitrators to determine, not as to whether Nova Scotia was entitled to receive back the subsidies given to a railway built within its borders, but as to whether Nova Scotia, having been induced to enter this agreement on representations made by the Dominion government, which representations were afterwards repudiated by the government-whether in good faith and justice the Dominion government ought to carry out its agreement. That was the question submitted to the arbitra-

tors, and that is the question upon which the arbitrators unanimously found for Nova Scotia. That is the case.


Robert Laird Borden: There is one observation I would like to make with regard to this. What does the Solicitor General think about the proper measure of damages for such a breach of contract ?


The SOLICITOR GENERAL.: The measure of damages has been settled by the arbitrators, and I beg to refer to their better opinion on the subject.


Robert Laird Borden: I thought probably my hon. friend would give me some such answer as that. There is one matter in connection with this arbitration that 1 do not quite follow. I may say that looking at the award as a whole, it does not seem in some cases to be expressed in very lucid terms. In saying that I do not in the' slightest degree desire to reflect upon Sir George Burpee, because I do not think it was drafted by him. I have perused many judgments of that very eminent jurist, and I have found them characterized by a clearness and lucidity which are not always present in this award. I do not understand from the terms of this award why it is that interest has been refused the province of Nova Scotia. The way in which that is dealt with in the award is this :
As to the interest claimed, there are many reasons why it should not, in our opinion, be allowed. It was not claimed for many years, and although claims were made by the province from time to time, they were made on different grounds, for altogether different matters, or, as is sometimes said, for better terms. The present arrangement having resulted favourably in a proper working of the road, benefiting the province as well as the Dominion, we think the ends of justice will be satisfied by refusing the claim for interest.
Well, I am bound to say that I do not see very much in these observations of the arbitrators that would prevent Nova Scotia from ' coming back at some future time and claiming interest. The province has to be congratulated upon that, because, of course, if a new reference were made in the same terms in which this is couched, It is perfectly open to the province at some future time to claim that interest. The reference has been made under these terms :
The arbitrators in making their award shall not be bound to decide according to the strict rules of law or evidence, but may decide upon equitable principles.
A subsequent claim with regard to interest if referred to arbitration in the same terms, leaves that question perfectly open to the province. I maintain that is the case.


The SOLICITOR GENERAL.: The reference is couched in the same language as is used in connection with the interprovincial arbitration.


Robert Laird Borden: I am not finding any fault with the terms of the reference.
I may say, as my hon. friend has referred to it, that I do not think the two cases are at all parallel in that respect. In that case there were claims on both sides, and, therefore, it might be fair under an Act of parliament to couch the reference in the terms referred to. I do not say that is unfair now, I am only observing, in reply to what my hon. friend has said, that I do not think the cases are parallel. My object in making these remarks was to point out that apparently the province has suffered an injustice in this respect by not receiving interest, as I see nothing in the reasons of the arbitrators to justify a denial of interest, assuming the claim is valid. I suppose the province will see that that is done.
There is one other observation to make. I would like to know from the right hon. gentleman who has presented this matter to the House, whether he does not think that the claims of the municipalities referred to in this award are just as deserving as the claim which has been made by the province. It is>
true that the arbitrators in dealing with this matter did not take into consideration the claims of these municipalities, but the reason they did not do so was the fact that the terms of reference excluded the consideration of those claims. Now, so far as I understand the basis on which this award is made up, there is only one basis on which the arbitrators proceeded to consider the question of damages.	That was the point concerning
which I asked my hon. friend, the Solicitor General, a question, which he thought it better not to answer, and I excuse him under the circumstances for not making any ijeply other than he did. It is clear the arbitrators in dealing with this claim based their award upon the amount of subsidies the province had paid. It is perfectly clear that the award does not show that any damages were sustained by reason of the alleged breach of contract. Therefore, if the arbitrators, having dealt with this claim on the basis of the amount of subsidy paid to the railways, it follows irresistibly, it seems to me, that the municipalities which have granted aid to this railway are just as much entitled to have their claims passed upon in the same way as the province. I would like my hon. friend to state to the House what his view is in regard to that. I am not discussing at present the question as to whether this claim should have been /referred or not. I think the claim, having been referred to these arbitrators, and the province of Nova Scotia having entered into an agreement for that puipose, the only thing for parliament to do is to vote the amount of this award, but if this is a right principle upon which to proceed, in so far as the province of Nova Scotia is concerned, I hold that it is a right principle upon which to proceed as far as the various municipalities are concerned. I can see no distinction between the two cases.


The MINISTER OF RAILWAYS AND CANALS.: I would like to Inquire of the hon. gentleman whether he does not think that the fact that a contract, even though not actually the subject of legislation, hut a legislative contract, having been entered into between the government of Nova Scotia and the government of Canada, it would distinguish the case entirely from that of the municipalities which may have given aid to this road, and with which the Dominion government had no contract ?


Robert Laird Borden: I observed, and in this I understand the hon. Solicitor General to concur, that it was perfectly plain In this case that so far as the amount of damages which have been awarded by the arbitrators was concerned, it was determined solely by the consideration that a certain amount of subsidy had been granted by the province of Nova Scotia to tiiis railway. The arbitrators did not proceed on any other ground as will be perfectly evident to any one who will examine the award. I can see no distinction between the case of the province and that of the municipalities. They seem to be precisely in the same category, namely, that this government, having become possessed of a railway, which railway has been constructed in part by subsidies from the province of Nova Scotia, and in part by subsidies from the municipalities, the Dominion should therefore refund, to the province and the municipalities the amount so expended. It is perfectly clear to any one who looks through the verbiage of this award that this is the principle upon which the arbitrators proceed. That being so, there can be no justification for refusing a reference of the claims of the municipalities, and there can be no reason for distinguishing their case from that of the province.


The MINISTER OF RAILWAYS AND CANALS.: If there is anything clear on the face of this award it is that the arbitrators have determined that there has been a clear breach of contract between the government of Canada and the government of Nova Scotia, and that whether or not the measure of damages is such as to commend itself entirely to their judgment from a legal point of view, the arbitrators, had power by reason of this reference to fix and determine, themselves, what the amount of damages should be according to any measure that commended itself to their judgment. But, my hon. friend cannot dispute the proposition that they recognized the liability of the Dominion to make compensation to the government of Nova Scotia, because the government of Canada had made a contract with the government of Nova Scotia which they had not performed.


Robert Laird Borden: I can only repeat what I have already said that I do Mr. BORDEN (Halifax).
not find a single fact stated on the face of this award which would justify the awarding of this sum of $671,836 as the measure of damages for the breach of contract. That is my view. It may not be the hon. gentleman's view, and if it is not there is no use of us discussing it. I understand the hon. Solicitor General to concur in the view which I have expressed to the committee, that the arbitrators have proceeded, not on that ground at all. They have proceeded on the equitable ground, which is, that the province of Nova Scotia having spent $670,000 and upwards on this railway are entitled to get it back. All I have suggested is that if it is proper under the circumstances to refer that matter to the arbitrators and to pay the amount of their award to the province, it is only right to deal in the same manner with the municipalities which have made a similar contribution.


The PRIME MINISTER.: The hon. gentleman is all wrong in his statement. It is stated in so many words that the reason why the arbitrators gave compensation at all to the province is because of the breach of contract. They have given that measure of damages and they are estopped from going the length of the full measure they could go, because the full measure I presume would be the restoration of the rights of which the province was deprived under the contract. So many things have happened since, that it was impossible to do that, but the measure of damages is given which it is reasonable that the Dominion should pay.


Robert Laird Borden: I do not want to take up the time of the committee by prolonging this discussion, but I say there is nothing on the face of the award to show that the province has lost five cents by reason of the breach of contract. But there is something in the award which shows that the province has expended $670,000 on this railway, and It is upon that ground that the arbitrators have gone in deciding the measure of damages, and not upon the question of the breach of contract.


The PRIME MINISTER.: My hon. friend (Mr. Borden, Halifax) says that the award does not show that the province of Nova Scotia has lost five cents by reason of the breach of contract. What is shown in the award is that by the breach of contract the province of Nova Scotia has failed to become the owner of the road as under the contract it should have been.


Robert Laird Borden: The province of Nova Scotia might become the owner of the road, and be much worse off.


The PRIME MINISTER.: That is not my contention.


Robert Laird Borden: Does not my hon. friend, as a lawyer, understand that

any person making a claim for breach of contract must show actual damages, otherwise he will recover merely nominal damages. I am not criticising this. I am only saying that the award really proceeds, not on the ground of breach of contract, but on the ground that the province expended a certain amount of money to get the railway, and that it is therefore entitled to get that money back.


The MINISTER OF FINANCE.: If there had been no question of breach of contract the same award would have been given ?


Robert Laird Borden: Yes, I think so. I think the same award might have been given if there had been no breach of contract.


The SOLICITOR GENERAL.: I think my hon. friend (Mr. Borden. Halifax) and I will agree, that if we were to proceed with this matter in court he and I would probably understand one another better. Under such circumstances the action would have been to set aside the contract. If proceedings had been taken you would have proceeded for a breach of the contract, distinguishing between the breach and the measure of damages. The breach is the starting point, and the measure of damages is the consequence. So, you deal with that breach of contract here ? Where is the breach ? The breach of contract entered into between the government of Nova Scotia and the government of Canada. Now, the municipalities cannot come in there, because we have no contract with them. The measure of damages contemplated here comes as a result of the violation of this contract; but you cannot deal with the municipalities on that basis, because you are without your premises. Your conclusions are all right, but your premises are all wrong, because the contract is wanting in the case of the municipalities. I think when we come to talk law we understand one another better.
* Mr. BORDEN (Halifax). I do not have the slightest difficulty with the hon. Solicitor General. I only suggest that when you come to deal with this breach of contract, and when you come to consider what are the damages consequent upon it, you will find nothing on the face of the award which will show damages there in the sum claimed. My hon. friend and I are at one on that. I simply go a step further and say that looking at the award in that light you will see that it Is plain that the arbitrators simply took into consideration the subsidy which the province had granted.


The SOLICITOR GENERAL.: The arbitrators have not proceeded on the ordinary rules of law, but as the arbitrators put it in foro conscientiae.


The MINISTER OF RAILWAYS AND CANALS.: Does the hon. gentleman (Mr. Borden, Halifax) affirm that the arbitrators have not explicitely declared that there was a violation on the part of the government of its contract with the province of Nova Scotia ?


Robert Laird Borden: I have not said anything of the kind.


The MINISTER OF RAILWAYS AND CANALS.: Then, my hon. friend's observation, made in the light of that fact, can have no possible application to the case of the municipality which has no contract with the Dominion government, and which, therefore, has no possible cause of action against it in respect to such railway. My hon. friend's argument that it does not appear that there has been any clear, or what he would call from a legal point of view, well defined measure of damages, concluded upon by these arbitrators, is a proposition entirely out of the question.
They affirm that there was a contract upon certain conditions. They affirm in so many words that when the time came for carrying out that contract the Dominion government used its force by duress to compel the government of Nova Scotia to submit to conditions which were not in accordance with the original contract. Having forced an unwilling acquiescence from the government of Nova Scotia, they followed that up by saying : We regard the amount which was contributed by the government of Nova Scotia as a fair compensation to that government from the government of Canada, which has done this wrong. You may turn or twist it in any way you please, but there is the connection clear and plain. I dissent from the proposition of my hon. friend who is holding out to the people of Nova Scotia an invitation to come to this government, or to some succeeding government with a demand to pay the interest on this amount. There is no basis for that proposition. The two parties agreed to a solution of this controversy by submitting it to arbitration, and whether Nova Scotia got little or much, or capital or interest, or neither, they can make no further claim with respect to this matter in the future. I am sorry to hear my hon. friends opposite make suggestions which will encourage demands that they know have no foundation in law or justice.


Robert Laird Borden: I must not allow to pass uncorrected the statement of the Minister of Railways. I see no reason stated on the face of this award for denying interest to the province. I say that if a further reference were made in the terms of this present reference, the province of Nova Scotia would be permitted to go behind this award in the matter of a claim for interest. This reference says that the arbitrators are not bound by the strict rules of law. and if those words were included in the further reference, they could go behind this award upon a claim for interest, just as under this reference the arbitrators have gone behind

the agreement made between the province and the Dominion of Canada. That is all I meant.


The SOLICITOR GENERAL.: The Sth paragraph of the submission to the arbitrators states that they are to decide if such claim should be allowed, and, if so, whether they should be allowed the interest from the date of the demand. Therefore, the arbitrators passed on that claim for interest, rejected, and disposed of it. The question was included in the arbitration proceedings.


Robert Laird Borden: I was led to make the statement I did because I do not find any adequate ground disclosed for refusing interest. What I say is, that if any similar reference were made in the future it would just be as competent for arbitrators to go behind this award as it was for these arbitrators to go behind the contract between the province and Canada. That seems to be the case. I have great respect for the opinion of the Solicitor General, and if he will say that is not the case I may feel bound to reconsider my opinion'.


The SOLICITOR GENERAL.: What my hon. friend says is, that if the claim for interest were submitted by agreement between the parties they might do so. That would go as a matter of course.


Mr. BROCK.: We have had a very lengthy legal argument from gentlemen on both sides, but I wish to draw the attention of the members of this House and of the people of this country to the very little that ordinary members of parliament have to say in matters of this kind. The Minister of Finance taunted us this afternoon that we had acceded to many appropriations and that we did not challenge them by a vote. What chance has the opposition got to oppose an item of this kind. What had the members of this House to say in the matter before it was submitted to arbitration. The claim came from the lower provinces by interested parties, the government arranged for an arbitration, and they now come with the results of that arbitration to force it through the House. They have already pledged the honour of the country to pay the money. The taunt of the Minister of Finance was undeserved by us, and was unworthy of him. What chance had the opposition to criticise this matter except from the legal point of view, and so far as that goes the gentlemen on the Treasury benches got very much the worse of the argument.


The PRIME MINISTER.: Hear, hear.


William Rees Brock: I can understand the leader of the government laughing at the ignorance of a layman, but I can tell him that the people of this country will look at this matter as I do. Perhaps the Minister of Finance could taunt his own followers. We have been here for over three months, and


Robert Laird Borden: we have had very few remarks from the members supporting the government and certainly never a dissent to( what the government does. What is the use of recording a vote on a matter of this kind ? We cannot stop it passing. Can the leader of the House show me how it is possible for us to block a deal of this kind going through. If he can show me I will be very glad to do it. It may be desirable for political reasons to pass this vote, but on the equity of the case the government has not a leg to stand on. I would not be at all afraid even in the absence of any legal knowledge, to meet the Minister of Finance-probably not in his own province but in any county in Ontario- to discuss this matter with him, and 1 think he would fail to convince the people that there was any fair chance for the opposition to prevent the passage of this vote through the House of Commons. Let the Prime Minister show how we can block a deal of this kind. If he does I will endeavour to block it. In view of that condition of things I again repeat that the taunt of the Finance Minister was neither fair nor just.


The PRIME MINISTER.: There is only one way and it is a very easy way. We submit this vote to parliament but the hon. gentleman (Mr. Brock) is not bound to accept our views. Of course the minority has to be bound by the decision of the majority, but there is a way in which the hon. member can protect himself; that is, to challenge this appropriation by a vote of the House. Then he will show before the House and the country what is his position and the position of his friends upon it.


William Rees Brock: There is a sophistry there. The hon. Prime Minister knows what chances we have in a vote of this House at the present time. When he says that we can challenge a vote of this House, he knows the solid voters which he has behind him, who would express an opinion one day in one direction and come into this House the next day and vote in the opposite direction.


The PRIME MINISTER.: My hon. friend knows also that if there is a solid vote behind us, there is a solid people behind us both to which he can appeal.


The MINISTER OF FINANCE.: I am sorry that the hon. member for Centre Toronto (Mr. Brock) took so much to heart my observations of this afternoon, which he has repeatedly characterized as taunts. I thought they were very moderate, not such as to give offence, and entirely in the line of legitimate criticism. I agree with my hon. friend on one point; we are both laymen, and are therefore apt to be confused by the lawyers' statements of this question. But so far as it is discussed, I am going to rely on the layman's view of it. I think this question has been made so plain by the arbitrators that the wayfaring

man, though a layman and a member of parliament, can understand it. I agree with my iron, friend that those who do not understand the matter thoroughly have not much chance of going into the 'history of this transaction and ascertaining it thoroughly from A to Z; and if I should go with him into the province of Ontario, where he seems to think the standard of criticism and intelligence is somewhat different from a similar standard in the maritime provinces -though I do not know why he should think so-and if I were to discuss this question with him there, I would not expect, in the ordinary time which would be given to me at a public meeting, to make all the citizens who might be iiresent understand it all; but I would expect to tell the audience in Ontario that an independent board of arbitrators, headed by a distinguished jurist from the province of Ontario, who had all the facts before them, had investigated the matter in every mood and tense of it, with the advantage of able counsel on both sides who understood the matter, and had given judgment; and I would ask the intelligent people of Ontario to accept that judgment, though they might not accept mine, nor the judgment of my hon. friend from Centre Toronto. This question came up as a claim from the present government of Nova Scotia; but inasmuch as it dealt with transactions which arose at a time when I myself was a member of the government of Nova Scotia, I felt from the beginning that I should not take a very prominent part in it. I realized that I should probably be called as a witness; and so I said to my colleagues in the ministry here, after I obtained their concurrence in the view that the matter should be referred for inquiry to an independent tribunal, that I wished to have no part in it, and that whatever was necessary for the presentation of the Dominion side would be dealt with by others, who would take advantage, of course, of any information that might be available in my department. So, realizing that I might be called as a witness, X took no part in the matter. The history of this case is a long one, and if any one were to take some isolated part of it, as some hon. gentleman opposite have done, he might find himself in error. But every fact stated, every passage read, every matter brought forward here to-night was fully placed before the arbitrators, and whatever force It was entitled to it received at their hands; and now we have their judgment before us.


James Clancy: Not all. The hon. gentleman's speech was, but that was all.


The MINISTER OF FINANCE.: I do not know how my hon. friend gets that. I know I was examined and cross-examined on that speech by the able counsel who represented the Dominion. Now. I want to give a brief statement of what I call the 186
layman's view of this transaction. The I'ictou Branch Railway, as it is calld, the branch in question, cost about $2,000,000. It is not to be confused with the Pictou town branch, built in later years. Sometimes the property in question is called the Truro Branch and sometimes the Pictou Branch. It is a line running from Truro to New Glasgow and to the waters of Pictou Harbour. It was the avowed policy of. all parties in this House, as far back as the seventies, to give up that branch for the purpose of assisting railway construction eastward. Whether or not that was a wise policy is not worth our while to debate. Originally a resolution was moved in this House by the late Mr. Justice Macdonald, at the time the member for Antigonish, recommending that that branch be set apart for that purpose. Ultimately an Act of parliament was passed setting apart that branch to be given for the assistance of railway construction eastward from New Glasgow. A contract was made between the government of Nova Scotia and a company headed by Sir Hugh Allan for the construction of the Eastern Extension Railway, on two conditions: first, a subsidy of $8,000 a mile, and secondly, the grant of this Pictou branch, which had cost upwards of $2,000,000. That branch was given up for that purpose, and virtually ceased to be the property of the Dominion government. The Allan Company built their road, 80 miles in length, relying on getting this Pictou branch as part of the consideration. There was in the tripartite agreement a condition, that if the company should fail to complete their contract, their property should pass into the hands of the local government, and if the local government should fail to operate the road effectively, it should pass into the hands of the Dominion government. The local government obtained that road, not by way of forfeiture, but by negotiations with the Allan Company. The government of that day, of which Sir John Thompson was Attorney General, entered into an arrangement with the Allan Company. whereby it consented that within a certain time this Pictou branch and the new road should pass into the hands of the local government. But though the local government of that day made that agreement with the Allan Company, they did not follow it up immediately by legislation. When in 1882 a new administration came into power, that agreement was brought to their notice -it was not at that time on the public files of the province-and it was then found that the local government had the right to acquire the Pictou branch and the Eastern Extension from the company within a given time. There was no legislation of a provincial character to raise money for that purpose, and the local government experienced some embarrassment as to how to deal with it. There were some negotiations with the Dominion government as to the



possibility of tbeir taking it over in trust or otherwise; but tbe Dominion government declined to have anything to do with it. When the local legislature met, it provided that the government might borrow money for the necessary expenditure, under an arbitration to determine what was the company's outlay in excess of the subsidy. That arbitration was held, the amount due the company was awarded, and arrangements were made for the purchase. That was done by legislation of the local legislature in 18S3. The local government were proceeding on the assumption that the new road was not in itself a profitable investment, at that time at all events, whatever its future prospects might be; but the basis of the arrangement was getting possession of the Pictou branch along with the new road; and before they would put a dollar into the enterprise, although they had taken legislative authority to do so, they sent delegates to Ottawa to place the matter before the Dominion government to see that there would be no trouble on that score. The delegates came here, brought their Bill, submitted it to the Dominion government, and asked the Dominion government to give their immediate assent to it; that is, that the question, of disallowance should be determined at once, instead of being allowed to stand for a year, as is usual, and that they should declare by order in council that the Act would not be disallowed, but should immediately go into operation. That step was taken, so that the Dominion government did not then contemplate any difficulty about the delivery of the branch. Sir Charles Tupper was then Minister of Railways, and he discussed the question with the delegates. He said to them :	The property is yours,
you are entitled to get it just so soon as you take possession of the new road. This is what he said, as reported in ' Hansard' ;
The committee was aware that, under the legislation which had already taken place, the government of Canada agreed to hand over the branch from Truro to Pictou for the purpose of securing the construction of a line eastward, and the government of Nova Scotia, with an additional subsidy, secured the construction of a line to the Strait of Canso. Under the existing legislation, the whole of that property is, therefore, the property of the Eastern Extension Company.
Observe, it was no longer the property of the Dominion.
But the government of Nova Scotia made a contract with that company which bound the company, in case the government by a certain time paid them their actual expenditure, to hand over to the government of Nova Scotia the whole property. It is expected that in a few days the road from Truro to the Strait of Canso will be in possession of the government of Nova Scotia, and the government of Nova Scotia are anxious to utilize that for the purpose of securing the extension of the railway system to Sydney in Cape Breton.
Thus, the consent of the Dominon was given cheerfully to the legislation of the


Mr. FIELDING.: province. We had the admission of Sir Charles Tupper, then Minister of Railways, that the branch had ceased to be the property of the Dominion, and had passed into the control of the Eastern Extension Company, which had transferred it to the government of Nova Scotia, and that in a few weeks the government of Nova Scotia would enter into possession. Relying on that, the local government sent their agent to England to arrange to borrow the money required. They committed themselves to a large expenditure, which they would never have dreamt of doing if they were not to obtain the Pictou branch as well as the new road. The arrangements went on until October. They took possession of the Eastern Extension property. They paid the money in accordance with the contract, and wrote to Ottawa to get possession of the Pictou branch, according to the law, and the understanding, and everything fair and reasonable. But the Dominion government refused. They gave no explanation or reason, but simply a flat refusal. Then the delegates came to Ottawa and asked for an explanation. It was long before they got any, and finally they obtained an order in council, setting forth that the property would be given over to them on certain conditions. The whole thing turns on the terms of that order in council. If it was a legal and proper order in council, then the Dominion was in the right. If it was illegal and improper, then the arbitrators have given a right decision in the matter. What were the terms of the order in council ? It declared, first, that the government of Nova Scotia must equip the road with a large amount of rolling stock. Hon. gentlemen have said that the Nova Scotia government were bound to have the road efficiently equipped. That is true, but, what is an efficient equipment ? The local government had provided that which they were advised by a competent railway engineer was a sufficient equipment ; and when the demand was made that they should put a larger equipment on the road, it was quite evident that the object was to impose a condition which would prevent their taking it over.


James Clancy: What did Mr. Schreiber have to say when examined ?
Mr. HACIvETT. What was the date of the order in council ?


The MINISTER OF FINANCE.: The 20th of October, 18S3. The Nova Scotia government made this proposal. They said that they did not admit the right of the Dominion government, at that stage, to dictate what was a proper equipment. They said that that question might come up later; but, in order that it should not be dealt with in a technical spirit, in order to take what the hon. member for Toronto (Mr. Brock) would call a layman's view of the matter, they 'said ; You ask us to put a certain equipment on the road, which our engineer

says is not necessary, we will refer tlie matter to three independent railway experts, and if they say that move rolling stock is required to efficiently operate the road, we will put it on. But, the Dominion government said : No, you must take our decision.


James Clancy: The hon. gentleman will not say that that came out in evidence.


The MINISTER OF FINANCE.: That is beyond dispute.


James Clancy: It does not appear in the evidence.


The MINISTER OF FINANCE.: It is not a matter of dispute. The correspondence showed that the Nova Scotia government were willing to call in independent experts, and that if these experts said that the equipment furnished by the local government was not sufficient, the Nova Scotia government would put on more. But, that government objected to being obliged to put on a quantity of rolling stock, which their own engineer advised them was excessive. The position taken by the local government was a fair and reasonable one.
The other condition was as regards the tariff. Our hon. friends opposite say that there was a condition obliging the Nova Scotia government to operate the road at a fair and reasonable tariff.


Robert Laird Borden: Has the hon. gentleman a copy of the order in council ? It has not been printed.


The MINISTER OF FINANCE.: The order in council of 1883 ? It is in the hands of the Solicitor General. The next question was with regard to the tariff. My hon. friend from Bothwell assumed that the local government had taken a most extraordinary position in that matter. I am satisfied that I can convince even him that the attitude of the local government on that question was a very fair one. What was the demand of the Dominion government ? It was, first, that you shall prepare a tariff at once. The local government replied : No, the moment has not arrived. We will take over that road and operate it under the existing tariff, and then prepare a tariff, under the terms of the Act, and submit it to you ; and when we do that, we are willing to discuss with you what is a fair and reasonable tariff. But, the Dominion government insisted : No, law or no law, you must agree on a tariff now. The Nova Scotia government refused, and the arbitrators have said that the demand was an illegal one.


James Clancy: The hon. gentleman will surely not say that any evidence was given to guide the arbitrators to that decision ?


The MINISTER OF FINANCE.: All the documents containing that fact will be found attached to the reports of the arbi-186* .
trators, because they are too important to be overlooked. The Dominion government not only insisted on a tariff being settled at once, but undertook to stipulate what that tariff should be. There is nothing in the Act which provides that the Dominion government shall prepare the tariff and fling it at the local government and say : You must adopt it. The Act says that a fair and reasonable tariff shall be submitted for the approval of the Dominion government.
In the first stage of the business, if the company had operated the road according to the tripartite agreement, the approval of the tariff would not have been in the hands of the Dominion government at all, but in the hands of the local government, and only in the event of a dispute between the local government and the government should the Minister of Public Works be called in as arbitrator. But, there was another stage. The road passed from the company into the hands of the local government, and the local government recognized that, as owners of the road, they did not occupy an independent position, and were prepared to submit a tariff for the approval of the Dominion government. But, the Dominion government said :	We will make a tariff
now, and you must accept it or nothing. You must like it or lump it.


William Rees Brock: The hon. gentleman is stating the case from his own point of view, and putting it as unfavourably, from the Dominion government point of view, as he possibly can. I do not think that the Dominion government could have used the language he attributes to them.


The MINISTER OF FINANCE.: I am putting the case as a layman to another layman.


William Rees Brock: You are not putting it fairly, but emphasizing it in the wrong way.


The MINISTER OF FINANCE.: The hon. gentleman has no right to say that. I have read the documents and he has not.


William Rees Brock: The hon. gentleman quotes the Dominion government as saying : You can either like it or lump it.


The MINISTER OF FINANCE.: They did not dot their I's and cross their T's just in that way, but that was the substance of what they said. They said : We will impose a tariff, and if you do not accept it, you cannot get your property. And I translate that freely to say : You may like it or lump it-and every layman in this House will agree with me. Now I am going to ask my hon. friend from Centre Toronto (Mr. Brock) to agree with me, because I know that, though he is a strong party man, this point is so strong


William Rees Brock: I am not aware that there is any party politics in this question at all.


The MINISTER OP FINANCE.: I withdraw that remark, I did not wish to wound my hon. friend. But, unfortunately, sitting on that side of the House my hon. friend is so prone to see things differently from the way we see them, and there must be some reason for it. But I wish to ask his attention to the next point as to the tariff that was provided. This branch from Truro to Pictou was about 40 or 45 miles long ; and the Dominion made this cool proposition, that we of the local government-for I was a member of it-should accept a tariff rate per ton-mile on that short haul of 40 miles the same as on the long haul of 800 or 900 miles of the Intercolonial Railway. That is, every ton carried over the 40 miles of that road should pay only the same rate per mile as was paid by every ton carried over the Intercolonial Railway.


James Clancy: Was not that the rate they were paying on that line ?


The MINISTER OF FINANCE.: They were running it as a branch of the Intercolonial Railway.


James Clancy: In the interest of the people.


The MINISTER OF FINANCE.: We are not discussing that. Of course all these things are done in the interests of the people. But this road belonged to the local government, according to Sir Charles Tupper, who dealt with the matter frankly and fairly. It was the right of that government to operate the road on the same terms as anybody would operate a road of 40 miles, and when the Dominion government made this demand that the same ton-mile rate should be charged as on the Intercolonial Railway, they made a demand that, my hoti. friend (Mr. Brock) will agree, was unjust and at variance with every principle of railway management known in this country. Will he agree with me in that ? Would he expect a little road of) 40 miles running out of Toronto to give him the same mileage rate as a great through line' of 1,000 miles ? He knows that such a thing is preposterous. If he were the owner of such a road and any one made a demand of that kind, he would make up his mind that that person did not wish to do business and he would leave him. I know, that I have his sympathy in that. The local government said : What is the use of keeping up this fight ? There may have been reasons for the Dominion government's action, possibly reasons related to the local interests of the counties. But whatever they were, the Dominion government said in effect: We do not intend to give you the property. And the local government, making the best of a. bad business, made an agreement that the Dominion should be allowed to take over the road on paying the same sum that the local government had paid to the Allans, about $1,200,000. The correspondence will show that again and again the demand Mr. BROCK.
was made for the subsidy. My hon. friend from Bothwell said that at no time were the local government anxious to get the road. Of course, he was mistaken. I know that the local government sent its members to kick their heels about Ottawa for two or three weeks at a time beseeching the Dominion government to give them the road. The local government passed an Act to raise the money to obtain the road. The local government appointed men to manage it, and they took over the eastern extension and had it in their possession. Surely the hon. gentleman cannot be serious.


James Clancy: The hon. gentleman was in the local legislature and took a prominent part in the whole negotiations, in fact, one of the most prominent. He must have sat very close to his leader, and his leader declared that the object of getting the Dominion government to take over the road and operate it for two years was to convince the province that it was not in their interest to have the road.


The MINISTER OF FINANCE.: Even if any individual said that, it would prove nothing. The local government passed legislation, borrowed money, employed men to operate the road, sent delegates here to Ottawa-did everything to get the road. Whether it was a good or a bad policy was not the question-it was their property and they had the right to it. They made the best of a bad bargain when they went back to the legislature. They were violently attacked by their opponents who said that they	should	not	have given up theroad.	They	made	the	best defence theycould. Take the whole debate through, and all the papers through, and it will be found that the spirit running through the whole thing	was	that the	local governmentmade every honest effort to get the Pictou branch,	while	the	Dominion government determined they would not give it, and, that being the case there was no use in trying to get it. Even if they had their legal rights, the local government might be embarrassed a great deal. This road was important in its connection with Cape Breton and Prince Edward Island, but it had to rely for its connection with the railway system of the continent upon the Intercolonial Railway which was managed by the Ottawa government. And if the Ottawa government were determined to act in an unfriendly spirit, clearly, the local government would not have much satisfaction in operating the road. The whole question is whether the order in council of 1883 was a proper interpretation of the agreement and the Acts of parliament. If it was, it is of no consequence to look at any other phase of the matter ; if it was a proper interpretation, the local government have no right to complain. That is the point that was referred to the arbitrators. They were able men. My hon. friend the Prime Minister has re-
*59-29

ferred to Chief Justice Burton. The others were Mr. Barbeau, of Montreal, and my hon. friend the present member for Annapolis (Mr. Wade)-though, not at the time of his appointment a member or candidate. These gentlemen went into the matter thoroughly. The Dominion had the benefit of the services of a very able lawyer, Mr. Lafleur, who did everything he could to maintain the interests committed to his charge. I know that he did his part in cross-examining me as a witness, and I honour him all the more for it. After going through the whole matter the arbitrators came to the conclusion, and reported, that the conditions laid down on the 20tli October, 1883, were not fair or reasonable conditions to carry out the spirit of the Act, but they were conditions which must have been made to frustrate the intention of the Act and prevent the local government from obtaining possession of its property. That is the crux of the whole business. If that order in council was fair, the local government have no claim. If it was unjust or unreasonable, net Intended to carry out the delivery of the road, but to prevent the local legislature from getting the property, it was a breach of contract and a great wrong. And, no matter what any individual may have said in trying to make the best of a bad bargain the fact remains that the wrong was done, and the arbitrators have so found it. In view of all the facts, the arbitrators decided that the order in council of 20tli October, 1883, was unjust, it was illegal, and, in consequence of that unjust and illegal Act the province should i-eceive compensation in the shape of a return of the subsidy it had paid for this extension. The Dominion government have already paid $1,200,000, and. if this award is acted upon and the amount paid, they will pay an additional $071,000. That is, the Dominion government will have paid a total of $1,871,000. For what ? For two roads which cost $4,000,000.


James Clancy: The province of Nova Scotia was recouped for that under the arrangements made for confederation.


The MINISTER OF FINANCE.: What has that to do with the question ? That pi dee of railroad was the property of the Dominion of Canada down to the year 1S70. Nobody disputes it, the Dominion owned it. The Dominion by an Act of parliament passed that over to the company, and through the company to the local government. Now, there is no use going behind that. It was Dominion property, they voted it away from their possession, and we have this statement of Sir Charles Tupper made in the House of Commons :
Under legislation the whole of that property is therefore the property of the Eastern Extension Company, but the government of Nova Scotia made a contract with the company

And so forth, showing that the government of Nova Scotia acquired the company's
rights. Therefore, by the confession of Sir Charles Tupper, that was the property of Nova Scotia. They were illegally kept out of that property, and in consequence this award has been made. Now, coming back again to the layman's view, that property cost $4,000,000. But no matter what it cost it was property owned by the government of Nova Scotia. That property owned by the government of Nova Scotia costing $4,000,000 passed into the hands of the Dominion government, and all they will have paid for it, including this award, will be $1.S00,000. So they will then have obtained $4,000,000 worth of property for which they have paid only that sum.


Edward Hackett: Was that amount you speak of charged to the province of Nova Scotia before confederation ?


The MINISTER OF FINANCE.: This Pictou railroad was in course of construction at the time of confederation, and was finished about the time of the union. No doubt it entered into the general financial relations between the province and the Dominion. But it passed out of the control of the Dominion just as much as a barrel of fish would pass out of the control of my hon. friend when he had sold it. It no longer belonged to the Dominion, it belonged to the province of Nova Scotia. Upon the faith of that pledge they borrowed that money, upon the faith of that pledge they did everything. It was their property, they had a right to if, and when they did not get possession of it they had a just claim against the Dominion government. The arbitrators, who were honourable men, who had more time to go into it than we had, who investigated the matter from beginning to end, and who surely had no desire to do anything but what was right and just for the whole Dominion, have decided that this sum should be paid.


James Clancy: The. committee will be surprised at the hon. gentleman who, after a very eloquent speech, has sat down without uttering one word to show that Nova Scotia has suffered any damage. No hon. gentleman has ventured to say that she has. Under all the circumstances. Nova Scotia having given a subsidy, they must have some excuse for getting it back.


The MINISTER OF FINANCE.: That was precisely the matter which was referred to the arbitrators, and they decided it.


James Clancy: My hon. friend knows that it is unfair to urge that the country has to accept and reverence a judgment because It came from respectable men. Respectable men in this country more than once have given judgments that eminent lawyers have dissented from, and that the courts have reversed on appeal. So I think it is unfair to urge any such consideration.

Nobody questions their respectability, but respectability has never on all occasions proved to have given judgments that are eitjier wise or prudent.


Edward Hackett: Prince Edward Island paid for its own railway. Now the government is asked to refund to Nova Scotia an amount of money expended since confederation on railways. I would like to ask whether, if you commence refunding to the provinces money spent on railways before or since confederation, you should not consider the case of a province that built its own railroads before confederation ?


The MINISTER OF FINANCE.: I now understand my hon. friend's question better than I did at first. The money which was expended by the local government, and which was the subject of this award, was not paid before confederation, but was paid many years after confederation, out of the local treasury, and had no relation to the terms of confederation.


Nathaniel Clarke Wallace: We have been treated to a long speech by the Minister of Finance. The ground that he has taken, apparently, is that this whole question was referred to independent arbitrators, and .we have the result of their decision. What kind of an arbitration -was it with Nova Scotia on the one side, pressing their claims as strong as they could, and the other side represented by the hon. gentleman (Mr. Fielding), who has just taken his seat.


The MINISTER OF FINANCE.: I was not representing the other side. I stated at the beginning that I had nothing to do with the Canadian side of the question. It was understood I was representing the province of Nova Scotia, and I told my right lion, friend the premier from the beginning, that I was not in any way to have anything to do with the management of the Canadian side.


Nathaniel Clarke Wallace: Who was it secured a reference to arbitration ?
The minister of finance. The
whole government, and to that I was a party.	'


Nathaniel Clarke Wallace: On whose recommendation ?


The MINISTER OF FINANCE.: On recommendation of the Prime Minister of Canada.


Nathaniel Clarke Wallace: On recommendation of the Minister of Finance, in the first instance.


The MINISTER OF FINANCE.: I was a party to it with all my colleagues. The only recommendation was the recommendation of the Prime Minister.


Nathaniel Clarke Wallace: Was it not a matter that came within the jurisdiction of the Minister of Finance ?


James Clancy: 


The MINISTER OF FINANCE.: Not particularly. A deputation came from the government of Nova Scotia and appeared before the whole council, and stated the case again and again, and the Prime Minister himself reported, for the particular reason that I did not feel, as Minister of Finance, that I was the man to manage the Canadian side of the case.


Nathaniel Clarke Wallace: As a matter of fact, here we have the evidence that on one side was the government of Nova Scotia pressing the claim, and on the other side was the government of Canada in full sympathy with the claim.


The MINISTER OF FINANCE.: That has not appeared.


Mr. WALACE.: Yes, it has appeared, it has appeared from the speech of the hon. gentleman who has just taken his seat.


The MINISTER OF FINANCE.: No, I say I wasi in sympathy with the claim.


Nathaniel Clarke Wallace: The hon. gentleman was in sympathy with the claim, and it was made a strong election card in the province of Nova Scotia.


The MINISTER OF FINANCE.: No, I never alluded to it in any shape or form.


Nathaniel Clarke Wallace: I am not speaking of the hon. gentleman. I say it was made a strong election card in Nova Scotia. The late Minister of Justice, Sir John Thompson, declared that was no legal claim, and I would accept the dictum of Sir John Thompson, as a jurist, in that matter before I would that of any one else I know of, because he knew all the circumstances of the case. He was a native of Nova Scotia, he was in the legislature, he was a judge, then he came here as Minister of Justice, he was in close touch with all the proceedings from the start; almost right up to the time he died. Sir John Thompson declared there was no legal claim whatever. Then what was there to refer to arbitrator's ? I say you cannot get away from the fact that you have on one side the parties pressing their claim, and on .the other side, instead of a party opposing it, you have a party in fullest sympathy with it. The Minister of Finance himself was in full sympathy with it.


The MINISTER OF FINANCE.: My hon. friend should not say I was on the Canadian side of the case, because I have told him again and again that I had nothing to do with the management. I did not even know who the counsel was until after he was employed.


Nathaniel Clarke Wallace: In the first place, he was a member of the government of Nova Scotia, that had long pressed the claim.


The MINISTER OF FINANCE.: Yes.


Nathaniel Clarke Wallace: Then he became a member of the government whose duty it was, supposedly, to resist the claim, else why did they refer it to arbitration ? Why didn't they investigate the claim as a government and say :	Yes, you have proved your claim,
and we will pay it without referring it to arbitration, without goiug through the farce of an arbitration. Then what does this open the door to ? The leader of the opposition has said that the claim for interest appears to him to be just as strong as the claim for principal. We will have, presumably, In the future, a claim made lor interest. If the claim is as strong, why should it not be made ? Then, we have the claims of the municipalities. The award does not say that the damages granted are for a breach of contract, but these damages are given because the province paid out money and we have to recoup it for the money paid out. If it he the case that the municipalities have equally as strong a claim as the Nova Scotia government to which we are paying $071,000, and we may have a further claim for interest we will have the municipalities putting in another claim, because, under the decision of the arbitrators, they have equally as strong a claim as the Nova Scotia government. Then, where will it end ? The province of Nova Scotia comes along with its claim and it will be said that the Dominion government is ready to recoup us; we will go to it with our unsound financial enterprises and hand them over to the Dominion. The claim of the province of New Brunswick amounts to $285,000, $148,000 of principal, and the balance in interest, and this claim is to be paid. Then, the province of Prince Edward Island comes along under the plea that during the years from 1S73 to 1870, the contract with them was not carried out. Hon. gentlemen opposite were in power during the whole of that period except perhaps a few months in 1873. I will not be certain about that. They did not keep up communication between the island and the mainland according to the terms of the agreement with that province. We had a claim settled the other day by this Liberal government, and this Liberal parliament which seems ready to vote everything through without any investigation. The Chairman was not able to read the item out until we had a chorus of voices declaring it to be carried. It is a scandal and a farce to say that this is legislation and that we are here to make investigations into the expenditure of the country. The clamour of the majority of this House prevents even a semblance of an investigation being made. Then the right hon. leader of the government comes along and asks: Why do you not take a vote ? Why do you rot call in the members and decide it in that way ? There is a better way than that, and it is to investigate the matter. You call in the members and vote it down. Unless
you express your dissent it does not give the people the reason for your objection to the claim. We have had the hon. member for South Lanark (Mr. Haggart), the hon. member for Bothwell (Mr. Clancy), and other hon. gentlemen going into the history of the case, but in the view of the right hon. gentleman, there is nothing in it at all. His argument is:	Call in the members.
They will decide the matter. Mr. Chairman, that will not go down -with the people of this Dominion. They want to have an investigation. They want to know what are the reasons for these things, and yet the only reply is :	Why do you not call
in the members. We have called in the intelligent jury of the public. The case has been stated from this side of the House, and we have had a confession from the non. Minister of Finance wTho is the ardent advocate to-night of the claim of Nova Scotia, as he was when he was the premier of Nova Scotia, and was advancing this claim against the Dominion government. I rely, so far as the legal points are concerned, upon the decision, after the fullest investigation into the facts, of the late Sir John Thompson who said that there was no legal claim.


The MINISTER OF RAILWAYS AND CANALS.: IV lie re does that appear ?


Nathaniel Clarke Wallace: I think I heard the hon. member for South Lanark (Mr. Haggart) state that in the House to-night. Of course we have not all the information because the hon. Minister of Railways and Canals has refused to put documents on the Table of the House that we should have. Where is the order in council relating to that matter ?


The PRIME MINISTER.: Here it is.


The MINISTER OF FINANCE.: It has been on the Table of the House for a fortnight.


The PRIME MINISTER.: And printed by order of this parliament.


John Graham Haggart: No, the order in council has not been printed.


The PRIME MINISTER.: Yes, I have it here.


John Graham Haggart: No, but I mean the order in council in reference to the alleged breach of contract.


The PRIME MINISTER.: The hon. gentleman (Mr. Wallace) asked for the order of reference.


Nathaniel Clarke Wallace: No, I asked for the order in council.


The MINISTER OF RAILWAYS AND CANALS.: My hon. friend (Mr. Haggart) had the order in council.


John Graham Haggart: No.


The MINISTER OF RAILWAYS AND CANALS.: It is amongst the papers.


John Graham Haggart: I handed *them over to the hon. Solicitor General.


Nathaniel Clarke Wallace: Well, the hon. Minister of Railways and Canals has been asked for the order in council and it has not been placed on the Table of the House.


The MINISTER OF RAILWAYS AND CANALS.: Yes, it has been placed on the Table of the House.


John Graham Haggart: I do not say that it has not been placed on the Table of the House. I got the whole of the papers, but I did not know that the order in council was amongst them. I handed them to the hon. Solicitor General.


The MINISTER OF FINANCE.: That was last night. The hon. gentleman has had them for a week.


Nathaniel Clarke Wallace: The hon. Minister of Railways and Canals has been asked for the order in council, we have been unable to procure it, and we are told now that the hon. Solicitor General has it. Why should it not be printed and distributed amongst the members ? Surely an important document like that, having reference to a vote of $671,000, should be available for the members of the House instead of being given to any one member to look at. It is not the $671,000. It is the fact that further claims may be made upon this parliament upon the strength of the payment of this $671,000, because other provinces may bring in claims equally as strong if not just on all fours with this one which is a complicated arrangement. They may be able to bring in much stronger cases probably than is presented to us on this occasion. We are spending the money-$671,000 to Nova Scotia, $285,000 to New Brunswick. making about $1,000,000, and $30,000 a year to Prince Edward Island, the interest on a million dollars at 3 per cent. The province of Ontario may come in on the strength of this, and inay present claims to the amount of $1,000,000. The province of Quebec may come along with its claims in the same way because the door has been opened.


Robert Laird Borden: May I suggest to the right hon. leader of the government that when papers relating to important matters of this kind are laid on the Table of the House a little care should be taken by some officer of the government to see that the necessary documents are brought down and printed ? It turns out that this order in council is a most important document.
I have searched the statutes of 1883 and 1884 to find it, and I have not been able to get it. However, it turns up now.


Tie PRIME MINISTER.: Here it is.


John Graham Haggart: 


Robert Laird Borden: Never mind about it now ; I am only stating that in the future I think some competent person might be instructed by the government to look after papers and see what are necessary for thet purpose of an intelligent discussion of the subject dealt with, and let these be printed and placed in the hands of hon. members.


The PRIME MINISTER.: In reference to the papers they have absolutely all been brought down. There are three or four volumes of them. Nothing could be more complete than what I have brought down.


Robert Laird Borden: The papers were brought down and they were ordered to be printed. I supposed they contained all that was necessary for an intelligent discussion of the case, but now it ajjpears that is not the case. I do not blame my right hon. friend, but, I say that in future some competent person should look over these papers beforehand, and see that everything is included which is necessary for an intelligent discussion.


The PRIME MINISTER.: This is sessional paper 73, and it is prepared for printing, not by a clerk, but by a committee of the House.
Mr. BORDEN (Halifax),. Then, let it be considered their fault.


Mr. BRITTON.: The proper question for discussion is, whether this government acted rightly in submitting this matter to arbitrators. There was a contract between the Dominion government and the province of Nova Scotia, and if disputes arose in reference to this contract, surely that is a proper subject for arbitration. I rise in order to dissent, and to put on record my dissent, to the propositions laid down, not very strongly indeed, but rather intimated, by the leader of the opposition. He stated that the door is opened to municipalities to claim from the government because of subsidies they have granted. Well, there is no contract between these municipalities and the Dominion government, and, therefore, there is no ground on which they can make a claim against the Dominion government. The leader of the opposition also stated that there is an open door left for a claim for interest, but he rather withdrew' that, although it was repeated by his first lieutenant (Mr. Wallace) and sometimes leader, who sits to his right. I dissent from that proposition as strongly as I can. The whole claim of the province, whatever it may be, wTas referred to the arbitrators, and they have decided on that whole claim. There is a finality in reference to these awards, and in some respects they are even stronger than the decisions of the courts. It seems to me altogether wrong to intimate that there is any chance of Nova Scotia coming back here and claiming interest, Of course, it goes without saying.

that if the Dominion government agreed of Its own accord to refer anew a claim for interest, arbitrators might have the power to deal with it, but no one supposes that when governments have submitted a matter for arbitration and an award has been made, that they are going to make another reference of a claim for interest. It is rather amusing to hear these gentlemen opposite say that they are not opposing this on party grounds, and especially so in the case of the member for Toronto (Mr. Brock). Why, every question is a party question with him.


William Rees Brock: Not at all.


Byron Moffatt Britton: When the hon. gentleman (Mr. Brock) -was a candidate in Toronto, he had the temerity to say that all the Liberals were hypocrites, and it took him all the rest of the campaign to explain that statement.


William Rees Brock: It was so true that I am elected.


John Graham Haggart: The hon. gentleman from Kingston (Mr. Britton) does not understand the argument. Does he mean to say that the arbitrators decided that there was a breach of contract and assessed damages ?


Byron Moffatt Britton: Yes.


John Graham Haggart: Well, he is the only one in the House who thinks that. There is no evidence that there was any damage done to the province of Nova Scotia, and the arbitrators do not say anything of the kind in their award. We complain that there was no rule to guide the arbitrators and so they adopted the rule of thumb. Under the same principle it is set out in this reference, every municipality in the country would be entitled to recover under a similar claim. The member for Bothwell touched the pit of the argument when he pointed out that not one member of parliament, from the Prime Minister down, attempted to say that there was the least damage done to the province. The fact is, that the province entered into a contract to build a railroad, and the railroad was taken over by the Dominion, much to the delight of the province, because they got the road better equipped and the rates lower than if the province operated the road. The hon. member for Kingston (Mr. Britton) said there was a finality to this, and that there could be no further claim for interest. Why the very next item is an award for interest just under similar circumstances to this one. He is making an excellent argument against the next item. The Finance Minister threw the taunt across the floor of the House that the opposition did not challenge a vote on any of the items in the estimates except one.
That is the sort of argument which might be used on the stump. Has the hon. gentleman ever had the pleasure of an intimate acquaintance with the proceedings of the British House of Commons ? Did he ever 'listen to the remark of the Right Hon. Joseph Chamberlain when a gentleman in his constituency challenged him for having allowed certain votes to pass without dividing the House upon them ? In the British House of Comons, as in the parliament of nearly every country, it is sufficient for the opposition to protest without dividing the House ; and a first-class statesman, a man who occupies a prominent position in any parliament, never divides the House in committee. If the matter is of sufficient importance, he makes his motion before going into committee, and divides the House then. But for these items the responsibility is entirely on the government, and it is sufficient for the opposition to protest against them, without dividing the House. Such an argument as the hon. Finance Minister has used is only wliat he might use when he is stumping Queen's and Shelburne, but it is not consonant with the dignity of a Finance Minister addressing the House.


The MINISTER OF FINANCE.: It might go in Ontario.


John Graham Haggart: I can tell the hon. gentleman that it is sufficient in our province for the people to know that we have protested all we could against this expenditure. The hon. member for Kingston says that this decision is a finality. But when he comes to the next vote, for New Brunswick, he will find that there is no finality to anything. He will be astonished at his own argument in this case, for he will find that we not only pay the award, but that a long time afterwards a demand is made upon us to pay the interest on the amount that we thought was a finality at the time. There is nothing to prevent the province of Nova Scotia, now that the governmefit acknowledges its claim, coming back in the future and demanding interest on the ground that we had already admitted the principle. That is the result of all these little deals. It is extraordinary that three of them should crop up at one time, just before an election-one in Nova Scotia, one in New Brunswick, and one in Prince Edward Island. Prince Edward Island seems to have got far the best of the bargain-$070,000 for Nova Scotia : $280,000 for New Brunswick, but $1,000,000 for the tight little Island of Prince Edward. Where does the rest of the Dominion come in ? That is what we are objecting to. If you are going to have rearrangement of the subsidies, there ought to be a fair share all round ; and you cannot expect gentlemen from other provinces to look with anything but jealousy on these arrangements with Nova Scotia. New Brunswick and Prince Edward Island. We have had brilliant surpluses for the last few years -nearly $20,000,000 raised from the people of the country, and expended where ? Part

of it to the Intercolonial Railway, and the balance, I suppose, as additional subsidies to these two or three provinces, and my poor native province without anything at all. I see that British Columbia is getting jealous. It is sticking its oar in if there is to be a distribution. But I am afraid that if there is a fair distribution Ontario will prefer to drop its portion of the plunder and leave the matter where it is.


Thomas Simpson Sproule: I wish to make a few remarks on this subject notwithstanding the lateness of the evening and the dying hours of the session ; and I propose to do it now, especially in view of the taunts thrown across the floor of the House so often that we have not entered our protest against any of the proposed items of expenditure. This Is, in my judgment, another raid on the treasury in the dying hours of the session, when less than half the members of this House are here to consider the question, the other half having gone home to attend to their duties, supposing the work of the session was over. By actual count a few minutes ago I found that there were exactly 65 members in this Chamber. That represents one-third of the House.
The MINISTER OP MARINE -AND FISHERIES. There were 151 here a short time ago.


Thomas Simpson Sproule: In the first place, I think the practice is wrong of submitting these items for our consideration at this late stage of the session. In the next place these items are evidence to us that there has been a concerted action in the maritime provinces to make another raid on the treasury of the country. We have heard rumours for some years past, and have seen them frequently denied by friends of hon. gentlemen opposite in the press, but now they have culminated in these appropriations. The arbitration on this transaction I regard as an arbitration voiced from one side and not from the other. It suggests to us this question : Will there ever be a finality in the financial arrangements between the provinces and the Dominion V We were assured in 1S84 that we had then reached a finality, when the Hon. Mr. Blake said : ' If there is not a finality on these claims on the Dominion, the result must be to break up confederation.'


The MINISTER OF MARINE AND FISHERIES.: That had nothing to do with claims at all. He was speaking of the rearrangement of the subsidies.


Thomas Simpson Sproule: The rearrangement of the subsidies based on the claims being made, with the possibility of other claims being made in the future. A rearrangement was made at that time, and amounts were voted that were thought to be sufficient. But it seems that we have not reached that finality yet ; and from what has occurred this session, there seems no reason to hope Mr. HAGGART.
that it will be reached in the near future ; for there is just as much reason for other provinces to apply for additional subsidies as the provinces which are now being recouped.
We have not a word of protest from the Ontario members supporting the government. The only one among them who opened his mouth on this vote is the hon. member for Kingston (Mr. Britton), and he volunteered a defence that was neither legal nor equitable, but political. I do not propose taking up time by going into the merits or demerits of this claim, but only wish to draw attention to the fact that the supporters of the government from Ontario. Manitoba, the North-west Territories, and British Columbia, instead of being here doing their duty on behalf of their respective provinces, are absent, witli the exception of a few who are prepared to allow the Minister of Finance to go it blind. The great province of Ontario, which is the milch cow of confederation, is being milked again, and there is not a member from that province supporting the government independent enough to enter liis protest. As soon as the item was called, I noticed these hon. gentlemen clearing out from the House, as they always do whenever there is a critical vote about to be submitted, so that they may afterwards plead as an excuse: I did not happen to be present when this expenditure was brought down.
We have this item of $671,836 for Nova Scotia, and that is to be immediately followed by another one of $280,692 for New Brunswick, and we have given practically a million dollars to Prince Edward Island. These three provinces ought to be satisfied. What guarantee have we that Quebec will not come next and that Manitoba and the North-west Territories and British Columbia and Ontario will not each follow in turn with a claim of a similar nature ? If there is one thing more than another calculated to break up confederation, it is these perpetual demands on the Dominion treasury.


Mr. GERMAN.: Has the hon. gentleman's leader repudiated this transaction ?


Thomas Simpson Sproule: Had the hon. gentleman been in his place, he would have heard what the leader of the opposition said.


William Manley German: I was in my place, and heard what he said.


Thomas Simpson Sproule: Has the hon. gentleman himself said one word against it ?


William Manley German: Certainly not. Has the leader of your party said a word against it?


Thomas Simpson Sproule: Certainly he has, and if the hon. gentleman had been in his place, as he should have been, he would have heard what the leader of the opposition said. Have any of his friends from Ontario said a word against it ? Not one.

They are willing to vote it without examination or inquiry. The item was hardly read before they all began Co cry out carried.


Mr. JOHNSTON (Lambton).: What particular item does the hon. gentleman take objection to ?


Thomas Simpson Sproule: I am taking objection to the item proposed to be voted now. Does the hon. gentleman know what it is ? He ought to have been in his place and knqwn what was being submitted to the House. I rose to enter my protest, and I say the principle is wrong. The arbitration was largely a one-sided one. These repeated demands from the provinces will lead to trouble in the future as they are doing now. These hon. gentlemen went to the people of the maritime provinces, upon the strength of what they could get from the government, and they are now delivering the goods to the best of their ability.


Alexander Johnston: Might I ask the hon. gentleman if he is thoroughly endorsed by his lender in the remarks he has made?


Thomas Simpson Sproule: I am expressing my own views, and that is quite enough for me, and if the hon. gentleman would give expression to his, he would be doing better than trying to cross-examine me.


Alexander Johnston: Are you endorsed by your leader in the remarks you made ? You are a prominent member of your party, are you endorsed by your leader ?
To provide for payment of award of arbitrators in connection with Eastern Extension Railway, New Brunswick, 5148.96S.75; for interest on same from July 1, 1884, to July 1, 1901, $126,623.43, and costs of reference, $5,100, $280,692.18.


The MINISTER OF FINANCE.: I do not think the facts could be stated any more clearly than they are in the award of the abritrators, which is not a very lengthy document. This claim arises out of the construction of the Intercolonial Railway about the time of confederation. The New Brunswick government had contracted to build a piece of road which afterwards passed over to the Intercolonial Railway. The commissioners of the Intercolonial Railway-that road was then in the hands of a commission-agreed to take the road off the hands of the company at a valuation, which was supposed to bear a relation to the cost of constructing the lines of the Intercolonial Railway in the same section, near the boundary line between Nova Scotia and New Brunswick. The estimated cost of construction of the Intercolonial Railway in that region was therefore the basis of the arrangement made by the commissioners of the Intercolonial Railway. when taking over this piece of road. The local government had contributed a certain subsidy to the road. They received part of that snbsidy back at the time out of the sum then paid. But it subsequently transpired that the estimated cost of the constructipn of the Intercolonial Railway in that region was far below the actual cost. When the New Brunswick government found that the cost of constructing the new portion of the Intercolonial Railway in that region was greater than the original estimate, they came to the Dominion government and said : You based your payment for the New Brunswick section on the estimated cost of construction approved by the commissioners, but you must give us an additional amount based on the actual cost.


James Clancy: Is the hon. gentleman in possession of the documents that he makes reference to ?


The MINISTER OP FINANCE.: Yes, but I cannot tell why the document was not sooner in the hands of hon. members. There seems to have been some delay in the printing. The Dominion government years ago acknowledged the propriety of the New Brunswick government's contention. They acknowledged that the property should have been taken over at a valuation, based upon the actual cost of construction of the new work on the Intercolonial Railway, and not the estimated cost. The Dominion government paid the local government $150,000 in recognition of that claim, that being the difference between the first valuation of the road and the second. From that time the local government have been contending for the interest. The argument of the province, and it was reasonable, was that if they were entitled to that money, they were entitled to it under an arrangement [DOT]about 1809, and if it had been placed to their credit in 1869, they would have received half-yearly, as part of their annual allowance, the interest on that sum. But it was not placed to their credit till many years after. The claim that they make is that they are entitled to that interest from the time when the sum should have been placed at their credit. It was thought well not to determine this claim by the government here, but to refer it to arbitration. The arbitrators were Mr. Justice Barker, of New Brunswick: Mr. Justice Lan-gelier, of the province of Quebec ; and Mr. Duncan Coulson. general manager of the Bank of Toronto. These gentlemen investigated the matter and came to the conclusion that the claim of the New Brunswick government was a fair and reasonable one. That, in brief, is a statement of this claim.	.


James Clancy: It seems perfectly clear that New Brunswick had subsidized the road to the extent of $400,000. Although a settlement was made at the estimated cost and $250,000 was placed at the credit of the province to recoup it for its ex-

penditure, the claim was made for the balance of $150,000. I shall not take up time by discussing the arguments, the reasons and no reasons, put forward in support of that claim. The amount was paid by a subsequent arrangement. So where are we now? We are asked to do what the hon. member for Kingston (Mr. Britton) told us in unequivocal terms could never be considered-to give interest upon a claim that was supposed to be settled. This means, as the hon. member for South Lanark (Mr. Haggart) has pointed out. Nova Scotia has a right to demand, on the same basis as that upon which this claim is allowed, that before this parliament rises interest shall be paid upon the sum which lias just been voted to that province. There is absolutely no difference between the cases. No training, no legal Ingenuity will enable any hon. gentleman to make a distinction between them. I will not detain the committee, but I wish to enter my protest against this dangerous system. If we hope to have confederation a success, we must have honourable, upright and manly partners in it. I do not consider whether the bargain we made with the maritime provinces was a good one or a bad one ; it was a bargain and it must be carried out. But, I say that we have now opened the door to a system that will undermine the whole federal compact, unless we can put an end to it.


The MINISTER OF RAILWAYS AND CANALS.: I am extremely sorry to hear my hon. friend (Mr. Clancy) take the ground he does with regard to this item. There is, in point of fact, no analogy whatever between the claim made between the New Brunswick government for interest in this case and the suppositious claim in the future which my hon. friend suggests will be made by the province of Nova Scotia for Interest on the payment that we have authorized to-night. I regret the line that has been taken by some hon. gentlemen on the other side. The only result that can flow form their observations will be to stimulate and encourage pressure to be brought to bear upon this or succeeding governments for the payment of interest upon that item. My hon. friend is deluding himself if he thinks that any other consequence is likely to flow, or if he thinks that the words that he and others have uttered will have any other results than those I have mentioned. This claim that is now before the committee is a very clear and simple matter, a matter which can be most readily understood. There are no disputed facts about it. The facts are these : Before confederation, the government in New Brunswick, like the government of Nova Scotia, was under pressure from the Imperial government to construct a line which was to become an intercolonial line. The object the Imperial government had in view Mr. CEANCY.
was that the two provincial governments should co-operate ultimately with the province of Quebec and secure the construction of a line through the maritime provinces to the city of Quebec. Yielding to the pressure that was brought upon the government of New Brunswick, they commenced the construction of the line from St. John and built it to Shediac. It then touched a point which was supposed to be most accessible to the island, and gave them connection with the province of Prince Edward Island. At the same time, and While the government of New Brunswick, at its own cost, was building this line, the province of Nova Scotia was running towards it to connect with it, building from Halifax westward, and they had built about to the Nova Scotia boundary. There was a hiatus, the connection was not complete, and in order to make that connection complete-mind you this was before confederation-the [DOT] government of New Brunswick made arrangements with Petto, Brassey & Co.-I think that was the name of the company-supposed to be a strong English concern. to take hold of it, and at the cost of New Brunswick and upon the-credit of New Brunswick, to complete that connection from Painsec to Shediac. That work was commenced before confederation, and was very nearly built at the time when the Act of confederation passed. But it was necessary of course that they should go on and build it, under the arrangements they had made it would be necessary that they should build it. It was nearly built, and I think it is now practically finished. **
When confederation occurred, or shortly after, the question naturally arose between the government of New Brunswick and the government of Canada as to whether they would take over this line. They were according to the terms of confederation under pledge and bound to construct a railway from Halifax to Quebec, having connection with St. Johns, and this would form part of that railway. The government of New Brunswick naturally expected that the Dominion government would take that road up for what they had expended upon it, complete whatever portion remained uncompleted. complete the connection with the Nova Scotia Central Railway system, and continue the work on to the city of Quebec. The province of New Brunswick, when they were endeavouring to conclude arrangements with the government of Canada for taking over this line, were confronted by an objection made by the government of Canada that they were asking too much when they asked to be recouped for their outlay upon that work. They did not ask /to be paid one dollar more than they had expended themselves out of their own exchequer for the construction of the railway as far as it had gone, but they did ask that they should be made whole of that expenditure. But the government of Canada said :	You are
5945	MAY 22, 1901	5946
not entitled to be recouped the amount which you expended because you have expended too much. It has cost you more than it ought to have cost you, it has cost you more than it will cost us to build similar sections of a similar class of work. We will have our engineers make an estimate of what it will cost for the completion of a similar class of work. In fact they said : We have made contracts for the construction of other sections of a similar character with this, and instead of costing $40,000 per mile as it has cost you-I will not be tied down to the exact figures-instead of it costing us $40,000, which you have shown us this piece of railway cost you, we are getting similar pieces of railway constructed for $24,000 per mile, and we will only pay you $24,000 per mile. The government of New Brunswick protested against that treatment, but they were told : If you don't choose to take the price which we are willing to allow you, namely, $24,000 per mile, we will complete another piece of railway alongside of it, we will parallel the line that you have built, which will make your line valueless. What could the New Brunswick government do but give up at once and say :	We cannot afford to stand any such
ruinous imposition, we will have to yield and let you take the railroad over and give what you choose. I am free to confess that they did then agree to hand the railway over, protesting, however, against the action of the Dominion government and claiming that they ought to have been repaid the whole amount of their outlay.
Well, they continued pressing the demand from that moment on. I think the reference shows that scarcely a year passed from that period down that they did not urge this payment upon the government at Ottawa. But it was a great while after the arrangement was concluded and the railway was taken over from them, before the Dominion government ascertained that their anticipations as to what they could get the same class of railway constructed for, were entirely below the mark. They found out that the line of railway was costing them more. It did cost them more than it cost the government of New Brunswick for this Eastern Extension which they built. When that fact transpired, the government of New Brunswick felt that they had an unanswerable case to be recouped this sum. The matter was referred to Mr. Frank Shanly, who was deputed by the government of Canada, ultimately, to make an inquiry into the matter. He made an inquiry and presented a report, and it is of record that he acknowledged that when the Dominion government insisted upon New Brunswick giving up its railway and accepting as its value the estimated amount which they named, that that sum was far below what they ought to have allowed, that their estimate was entirely erroneous, and that the cost of this other section upon which they were
basing their estimate as to what ought to have been the cost of the New Brunswick road, was many thousands of dollars beyond [DOT]the actual sum it had cost the government of New Brunswick. In fact it cost the Dominion government more to build this section than it had cost the government of that province. Ultimately, in 1884, the government of Canada came to the conclusion that they were in duty bound to pay this amount, that is to say, the $150,000 which remained of the $400,000 coming to the province of New Brunswick. They paid the amount then. At that time the claim before them was not only a claim for the $150,000, but it was also a claim for interest which had been withheld on semiannual payments and which then amounted to a considerable sum. The government at that time said in parliament, through the Minister of Railways and Canals, when he was asked whether the interest was going to be paid, said Interest was not included. that that would have to be a matter for future consideration. There was a distinct understanding that interest would be exacted. The records show that interest had been demanded, but all the government was willing to pay was $150,000, and they paid it without any stipulation whatever. It was not paid by the Dominion government upon condition that it should be accepted in full, it was not received by the government of New Brunswick upon the condition that it was a payment in full; it was simply a payment on account, as. I think, will appear to any one who refers to the ' Hansard ' of that time.


Robert Laird Borden: The hon. gentleman refers to the ' Hansard.' Can he say what was stated by the minister who had charge of the item ?


The MINISTER OF RAILWAYS AND CANALS.: My recollection is that it was Mr. Weldon who asked the question, and the minister replied that interest was not included in this, owing to the understanding that it was not decided they woidd pay the interest, and it was not decided that they would not pay it. That is the language which, I think, was used by the minister at that time. At all events, there were no conditions. The records will show that the amount paid to the government of New Brunswick was not paid upon any such condition, nor was it received on any such condition. The claim for this sum has been pressed upon the attention of the government from that time down to the present. From time to time we were receiving encouragement from tin1 government that the matter would be dealt with. Payment was not, as I recollect the facts, distinctly refused ; in fact, the Minister of Railways, to my own personal knowledge, and to myself, when I came up to Ottawa on one occasion in reference to it, stated that he recognized the claim as a legitimate one.

and he authorized the Governor, who was then Sir Leonard Tilley,' to make the announcement to the provincial legislature that the amount would be included in the estimates for that year. The announcement was made by the Governor that hn had such authorization, but some difficulties occurred during the session, and the amount was not inserted in the appropriation. But, the Minister of Railways himself, Sir Charles Tapper, expressed then, as he will express to-day, his clear and decided opinion that it was a proper claim to pay, and if it had rested with him, if there had been no difficulties raised in other quarters of a nature which were not at all pertinent to the question of the merits of the claim, but which arose outside altogether of that consideration, there can be no doubt as to what would have been the result. The matter has been held over from that time down to the present, but the gentlemen who took the evidence, who examined I he witnesses and the records, and who made this report, have arrived at the conclusion that the claim is a legitimate and proper one and ought to be paid.


Robert Laird Borden: I merely want to ascertain if I understand the matter correctly. This $150,000, which is referred to, represents tlio excess of the cost of this road through the province of New Brunswick, over and above what was paid to the province by the government of Canada ?


The MINISTER OF RAILWAYS AND CANALS.: There was $894,000 paid by the government of Canada to these contractors. There was admittedly $400,000 paid on account of that road by the provincial government. The Dominion government, according to their estimate of the probable cost of tire work, admitted the amount which justified and enabled them to pay the contractors the sum of $894,000, and paid $250,000 to the New Brunswick government on account of the $400,000 which they had paid, leaving $150,000 which was not settled until 18S4, some fifteen years after the amount was due.


Robert Laird Borden: I think I am right in my idea ; in other words, the road had cost the province of New Brunswick $150,000 more than they received from the government of Canada. That is the position, Is it ?


The MINISTER OF RAILWAYS AND CANALS.: Yes, that is right.


Robert Laird Borden: And the amount fixed was by reason of the fact that the province of New Brunswick was compelled to accept payment on the basis of certain contracts which the government had outstanding at the time ?


The MINISTER OF RAILWAYS AND CANALS.: Yes.


Mr. BLAIR.: 


Robert Laird Borden: And it was afterwards ascertained that the estimates were too low ?


The MINISTER OF RAILWAYS AND CANALS.: Yes.


Robert Laird Borden: And when the readjustment was made the government paid the province of New Brunswick $150,000 ?


The MINISTER OF RAILWAYS AND CANALS.: Y'es.


Robert Laird Borden: And the contention of the province of New Brunswick is that that amount was not accepted in full of interest ?


The MINISTER OF RAILWAYS AND CANALS.: The contention is that the $150,000 was due and payable when the $250,000 was paid just as righteously as it was payable later on.


Mr. EMMERSON.: It should have been placed at the credit of the province at that time.


The MINISTER OF RAILWAYS AND CANALS.: Only $250,000 was paid, but there was still payable $150,000, which was placed to the credit of the province later on.


Edward Hackett: Do I understand the lion. Minister of Railways and Canals to say that we are now refunding to New Brunswick the expenditure for building railways before confederation ?


The MINISTER OF RAILWAYS AND CANALS.: The interest upon it.


Edward Hackett: Well, I hope you will be as generous in dealing with Prince Edward Island. We built our own railways and paid for them before confederation, and we have only asked you to refund us the interest on the building of these railways charged up against the people of Prince Edward Island before confederation.


Byron Moffatt Britton: I cannot help, saying in passing that I can hardly understand how the arbitrators could have allowed interest at 5 per cent to the province, when, during this time, interest lias been very much lower than that.


The MINISTER OF RAILWAYS AND CANALS.: Because, the province would have drawn interest at the rate of 5 per cent under the terms of the confederation compact.


Robert Laird Borden: That would be so if it were carried to the credit of the province.


The MINISTER OF FINANCE.: That
$150,000 was carried to the credit of the province.


Robert Laird Borden: But it was by agreement.


The MINISTER OF FINANCE.: This matter arising at the time of confederation, it was proper that it should be placed at the credit of the province, and all these transactions at the time of the union were based on a rate of 5 per cent.


Henry Robert Emmerson: The province of New Brunswick would have drawn $3,750 each six months if this had been placed to its credit.


The MINISTER OF FINANCE.: My hon. friend (Mr. Borden, Halifax), I understand, contends that it was placed there by agreement, and not by statute. All these matters at the time of confederation were on a 5 per cent basis.
Some resolutions reported.
On motion of the Prime Minister (Rt. Hon. Sir Wilfrid Laurier), House adjourned at 12.05 a.m.-Thursday.

Thursday, May 23, 1901.