IMAGE EVALUATION TEST TARGET (MT-3) .i^ ^ ^^o 1.0 tea 12,8 |25 |jo ■^~ !!■■ U Hli 2.0 i.l f«l U 1-25 1.4 11.6 s^^^ ^^s nil ^^S ^ 6" ► V] i^:'!' ,^>'r, '':■?^•^ 't^i*''.-^';;VA';^ A Inside History OF HOW THE GOVERNMENT TREATED THE BANK NOTE CONTRACT, AND THE ENCOURAGEMENT QIVEN TO CANADIAN INVESTMENT. ■' * I > ■'! I 'J / - . ■'», ADDITIONAL FACTS CONNECTED WITH THE BANK NOTE CONTRACT. When the papers in connection with the Bank Note Engraving Contract were Ijrought down, they revealed a condition of affairs bad beyond belief. The public were led to believe that the tender of the British American Bank Note Company for engraving was excessively high. The papers reveal the startling fact that their tender, upon Bank Note engraving alone, — not- withstanding all the calculations and additions made — was $18|416i88 '^^^ than that of the American company ; and in another branch of engraving and printing, the price of the American company is nearly FOUR TIMES greater than that of the Canadian company — that is $7|332.99. ^^ against $1,935.04— 'in almost INCREDIBLE FACT, for the same amount of work. Add to this the five or six thousand dollars which the Queen's Printer will have to pay for machinery to do the stamped envelopes, which the Americans had removed from their contract, and the saving which might have been effected by the Queen's Printer doing the Postal Cards as well as the stamped envelopes. What then becomes of the alleged large saving to the country, for which a national industry has been destroyed? This engraving is the essential part of the work — the heart of the whole matter. It is for this the Canadian company has invested so large a Capital ; has maintained so large an establishment ; has retained the services of a permanent and expensive staff of Artists for a long series of years. Any apparent reduction in the American tender was made as a cut rate upon the mere mechanical work of printing, work which could be done by any well equipped Canadian printing house. This cut rate is more than doubly met by the permission the Americans have received of doing the engraving in New York. They, like the Canadian company, have to retain a staff of engravers, under yearly engagements, and this contract merely serves to keep them employed continuously, with no additional working expenses, nor tax on their business of any kind. There is grave doubt as to whether the whole transaction is not illegal, seeing that the established practice of awarding contracts was departed from in every particular. A brave show was made of calling for tenders, and circulars were sent broadcast inviting them. English firms entertained the proposal, xind asked if the work might be done in London. This per- mission was refused, and yet it was accorded to the American firm to do the work in an alien country. Why were the Americans favoured above their British competitors, to say nothing of the Canadian companies ? If economy was the object, and if it was intended to have the essential part of the work— the engraving — done outside of the country, why not have it all done outside, instead of the pretence of doing it partly here, that is, the mere mechanical printing ? The only thing that has been accomplished is the wanton destruction of an old-established enterprise, wanton because no permanent good can result to any one, and the plea of economy is only a sham. The Americans made a cut rate upon the cheapest kind of machine work, and were allowed to amply make it up by the permission given them of doing the essential work in New York, the part requiring Capital, Talent, and an Established Business, directly contrary to the speci- fications. The fact of doing the printing in Ottawa is no guarantee of any con- siderable expenditure in the country, nor of security while the engraving is done in a foreign country. Even for bank note paper the American firm is awarded the same price for which the Canadian company offered to supply it, so the country saves nothing on this item, although it is about one-fourth the whole value of the bank note ivork. The American company, made a cut rate to gain the field. The minister v inlntpd the soecifications A STATEMENT OF THE TREATMENT ACCORDED TO THE BRITISH AMERICAN BANK NOTE COMPANY BY THE MINISTER OF FINANCE. HON. W. S. FIELDING. Y |HE history of the first large contract entered into by Hon. W. S. Fielding after his translation from the Provincial to the Federal Cabinet, that by which it is intended to give to aliens instead of to Canadian citizens the duty of producing Canada's currency, is not only instructive, but is of vital interest to all classes of the community. Nothing can be of greater importance to the Capitalist, the Banker and the Merchant, than that the current money of the country should be undoubtedly genuine, and that there should be no possibility of counterfeiting. It is of vital im- portance to the Contractor that the secrecy of a tender submitted by him, under seal, to a Minister of the Crown, should be most strictly observed, but should the course which has been followed by Hon. Mr. Fielding in this case be generally adopted, contractors will find that the results of their labor in preparing tenders are merely supplying Ministers gratuitously with data on which to nego- tiate with outside parties for a lower price. To the skilled artisan it is necessary that as much high-class, and therefore well paid, work as possible should be produced in Canada, but the result of this contract will be to allow a large amount of skilled labor to be done at Canada's expense, in the neighboring Republic. To every Canadian, it must be clear that our public men, espe- cially those in positions of trust, should, like Caesar's wife, be above suspicion ; that their every act should be capable of bearing the closest inspection; that those who have to repose trust in them, should in every case find that trust sacredly observed, and that Canadian interests of Capital and Labor, whether public or private,, should be defended in every way possible. Unhappily, Hon. W. S. Fielding does not appear to take this view of the case in the matter of the Bank Note Contract. To show how this has been done, it is necessary to give a r^sumd of the facts since the accession of the Liberal Government to power in July last. When Mr. Fielding became Minister of Finance, he found exist- ing a contract between the Crown, represented by his Department, and the British American Bank Note Company, (of which Mr. G. B. Burland is the president) for the printing of the Dominion bills, stamps, etc. This particular contract had been in force for some years, and was the last of a series of contracts for this class of work extending over a period of 35 years. During all this time the Com- pany have the satisfaction of stating that no accident or error of any kind has occurred, and the work has always been done at least 30- per cent, less than current American prices. — a — One clause in the contract stipulated that it could be terminated by giving six months' notice, and on September a6th, 1896, Hon. W. S. Fielding gave legal notice to the British American Bank Note Company of the closing of their contract at the expiration of the six months' term. This notice was duly followed by an advertise- ment inviting tenders for November 23rd last. Three or four Canadian Syndicates examined the specifications and the nature of he work to be done, but owing to the fact that the Government would not allow it to be done in Montreal or Toronto, and finding the capital required under such circumstances too large, the responsibility involved too heavy, and the risk attend- ant on it so great, they all declined to submit tenders. In this way the Minister succeeded in putting a veto on the aspirations of Canadian capitalists, but it is now apparent that he was quite willing to allow the engraving to be done in New York by his American friends and, according to the Toronto " Globe," promised them the privilege of a second term, if they desired it. The result of this discrimination is made manifest by the fact that it is stated that only one Canadian Tender was submitted ; as a consequence, when November 23rd was over, only one tender had been sent in, that of the British American Bank Note Company. Was this tender opened, and was it at this stage the American Bank Note Company of New York were invited to tender ? At any rate, as a result the American Company, we are informed, were allowed to change the specifications and duly sent in a tender to suit their own wants. . No further action was taken by the Canadian Company till one of two things would happen, either they would be notified of the acceptance of their tender, or if it were not satisfactory, new tenders would be asked for. This, of course, is the procedure always followed in bona fide tendering. No communication of any kind was had by the Government with the Canadian Company until two days after the Minister had the Order-in-Council passed on the 6th January, 1897, with only four members present, and in great haste had it signed by the Governor General ; then on the 8th of January, he was magnani- mous enough to send the following letter to the Company: — Sir, Ottawa, January 8th, 1897. Referring to your letter of the 21st November last, submitting a tender for engraving and a cheque for $5,000, as a deposit, in compli- ance with the terms and conditions set forth in Circular dated 19th October, 1896, I have the honor to state that I regret that I am unable to accept the offer made in such tender, as the Government have a much more advantageous offer from another Company. I have accordingly given instructions to have the amount of your deposit returned to you. I have the honor to be, sir, Your obedient servant, G.B. Borland, Esq., /V dian workmen under the Alien Labour law, which la interpreted and applied with extreme rigour. Even nuraea and typcwritera fall under the provlaiona of thia Invid- ioua and oflenalve piece of legislation, and are not allowed to pursue their callings in the boasted land of the free. A short time ago the Premier was so moved by the petty persecution to which our countrymen and countrywomen have been and are aubjected that he declared that if It continued the Dominion would retaliate. Now, howerer, aa above stated, an American firm is awarded a large contract over a Canadian competitor. There is a spirit of Christian forgiveneaa in thia episode which cannot be too much admired— from the other side of the line, where, however, it will never be imita- ted. Can anyone conceive the government at Washington giving its engraving con- tract to the Burland, or any other Canadian company, because Its tender was somewhat lower? Could a Canadian get a contract to the extent of one dollar from the State of New York, or any other State? Waa such a thing ever heard of? If any American government could entertain such a preposterous notion, the press and public would howl it out of existence. Yet we, unselfish and magnanimous people, being struck on one cheek, meekly hold out the other, and thank our aggressor Into the bargain. This is a practical admission of the Monroe doctrine. "Our country la bigger'n your'n, and consequently our rights are bigger too." Uncle S 'm la aupreme on this continent. He will have the United States for the United Statesera, and will look to get a good deal of Canada too. Perhaps this is an inauguration of the vigorous immi- gration policy of which we have heard so much. Canadiana being severely barred out from receiving any business favours in the States, while United Statesers can get government contracts in Canada, who can doubt that immigration in the latter country will be greatly encouraged ? Now let John Charlton'a heart rejoice, and hia country- men in Michigan be glad, Ottawa is to be the Washington of the North, and here their interests will be as carefully guarded as in the other Washington farther south. Ottawa Evening Journal, Jan. /j, iSg^. THE GOVERNMENT ENGRAVING. The Dominion government is coming in for sharp criticism for its award of the bank note engraving to a United States firm, and a number of Liberal papera are de- fending the government by the plea that $120,000 a year is saved by the contract with the American firm. There is no proof yet of any large saving. The Liberal papers which make the contention may be misled by the assertion that the new contract is to be $120,000 a year lower than the old one. This does not mean that the tender of the American firm was $120,000 or even $120 lower than some Canadian tender. It is a comparison with past prices, not with tend- ered ones. The public has no reason yet to know that the Burlands did not tender within a few dollars of the New Yorkers. It may be that the new Burland tender was very high, but that is not yet officially stated. The Journal did not comment upon the new contract because the full facta were not known. But it is proper to say that unless there can be shown a great saving in the contract with the New York firm below the prices which Canadians offered, the government will deserve condemnation. It is not enough to say that the foreign firm must establish a branch here. They will bring foreign labor probably in all depart- ments, and certainly in the superintending offices, and their profits will go across the line, while m the meanwhile a number of Canadians at present employed in such work will be turned on the street. ** Ottawa Citizen. THAT ENGRAVING CONTRACT. The motives that animated the government in this extraordinary step of giving the engraving contract to an American firm cannot be divined. We are told that for the five years there will be a saving of $120,000, as compared with the last five years. But we are not told what the difference was between the tenders of the American com- pany and the Burland company respectively. For aught we know there may not have been a thousand dollars difference. In any case the Canadian firm should have been allowed the option of taking the work at a reasonable price. The preference shown to a foreign rival, belonging to a nation which treats our people with petty and cease- less hostility, and trade intolerance, is amazing. It would seem to indicate a burning desire to show that the government cares no more for Canadians than it does for Americans. . (Ottawa Correspondence^ Montreal Gazette.) Ottawa, Mkj 8. - The faotH rcgnnlitiK the Imtik not« cotitraot which wai given by th<* Unveniiiifnt to a Ni^w York concern, wpre iliiclnwd today l>y the rroiiuctiiMi of the corri'Niiondcnce. The docnnicntH fntahliali ^^nt the AincricHD lank Note Cotu|iaiiy ottVrrd a cnt rate to the Oovcniincnt to g a foothold in Canada, that It dictated tcriua to tlie (invfrnmrnt directly in violitli')n of the RlwciflcationH, that the ilritiali American Hunk Note Company afttTwarda ITt-n-d to take the contract at the same figure as iia American com|iitit< » had nauud, and that the contract was afterwards awarded to the Aniericun vAmfju'Xw at a f^n-ater cost to the nountry than it wonid have been done by the CanadiflM eom* |>any had its revised oiler been accfitted. The new contracts were called wx hint fall. OITeis were made 1 y ''"• American Hank Note Com|)any, New York; the ISritiHli AmtTicaii Bank Note ( •■i|iniiy, of Uttawa ; and Karber & Ellis Company, of Toronto. Tlie latter was nu") out Wause the tendercra oil'ind pntonal m-curity instead of the cash deposit of t.lOiOOO. Of the two that remained that of the American Hank Note Com nan y figured out at t09,040 a year, and that of the Dritish American Rank Note Company at 9128,84:). The ollVr of the Ottawa company was slightly higher tlian the rates )iaid under the former contract, which figured out at 912n,00U. In hia report upon the tenders, Mr Couitney, the Deputy Minister of Finance, pointed out that when the last contract with the liritiHii American Hank Note Company was made, enipiirieH were instituted to ascertain if the ratea were fair ones. It waa fouhd that they were quite as low as the American iiank Note Company was doing the same work for the banks. It follows, therefore, that the ollVr made was coimiderably below the ordinary ratos of the Americnn concern, and may fairly be called cut rates. The American oiler was, strictly H|)eakiiig, informal and in vio- lation oi the specifications. Section 7 of the Hpecifications recpiired that all work under the contract should be done in the city of Ottawa. This wiis accepted in its entirety by the Canadian tenderer. The American Dank Note Company added a provise to its tender as follows : — " The American Hank Note Company under- stands and makes it a part of this tender that it is not reipiired by the si)ecifi- cations hereto attacheil to manufacture bank note and other pa]iers, steel rolls, steel plates, the dies and other tools of the trade, inks, colors, etc., in the city of Ottawa, but that such supplies necessary to the faitlilul fullilment of the contract may l)e obtained elHewliere." Considering this variation of the conditions con* •iderable correspondence took place. Work Done In New Yopk. The De|>uiy Minister of Unnnce called attention to the new condition, and added this would allow them to do a large portion oi their work in New ^'ork, which senns to require very careful considerotion. Thereujion Jlr. Fielding, instead of throwing out the olTer as a violation of the specifications, wrote to the American tenderers for ex]>lanation8. They replied that they proposed to i)roduce nil the original dies in New York, because there is not the taleut in Citmida to do the work, nor was it obtainable here. " In the United States there were better machinery, better workmen and better ideas of art." The company practically dictated its own terms to the Government in this n-si)ect. It told the Government that the Canadian otlicinls did not know wl.at they were talking of wheit they insisted that the dies cotild be made in Canada, or to use the exact words, "They were not fauiiliar with bank note engraving." In nsjionse to a fi eble protest from Mr. Fielding, the company kindly agreed to modify its position so far as to make the foundation dies in New York and do the jmtting together in Ottawa. Therenjwn Mr. Fielding reported that the terms were satisfactory, although con- trary in this respect to the sjiecilicatioiiH. Before the contract hud been accepted, Mr. G. B. HurlHiid, on behalf of the British American Hank Note Coni]).iny, asked for a reconsideration. He claimed, among other things, that he had not been aware that he wouM have to compete with foreign concerns, and that the offer of the American cDm])auy was contrary to the specifications. As no notice was taken of this, Mr. Burhind offered to a<'cept and carry out the contract on the terms offered by the American company. This offer was never rej)orted upon by the De)>uty Minister of Finance. But from a statement which appears in Mr. Court- ney's report, it is clear that the last offer, although nominally for the same figure, was really lower than that of the American concern. Mr. Courtney pointed out that giving the contract to a new contractor would call for a large immediate outlay for dies, designs and rolls. This is necessitated by the acceptance of the New York offer, but would have been avoided had the Canadian company been given the contract. The facts submitted to-day show that the boast that the work is to be done in Canada is a hollow sham, as the most important part is to be done in New York. They show that in this important respect the tender of the American contract was amended, v.hereas the Government refused to allow any change in the Canadian offer. They show finally that the last offer of the British Americnn Bank Note Company, having regard to the initial outlay, is lower than the offer finally accepted. hi 11 '■ I :i 'i ■'! ^'^ ■u % .1 - 1. 'i'v>-: Britisl? /imerieai) Bai)l^ jNlote Qo, ENGRAVERS and PRINTERS, OTTAWA AND MONTREAL. Vt,' INCORPORATED 1866. CAPITAL, $200,000. ckX^ ' \f' •■■■.//> .V--"- The Company have much pleasure in thanking their friends and customers for the patronage extended to them during the past 35 YEARS, and beg to state that their business will be carried on ■with renewed vigour and energy for the future. W '1 » > ♦ < * Bank Notes, Certificates of Stock, ^ S$* Debentures, Bonds, Bills of Exchange, AND HIGH-CLASS COMMERCIAL WORK , . AT GREATLY REDUCED PRICES, 'i. IN BEST QUALITY OF STEEL PLATE WORK. Please send for SA MPLES and TERMS before ordering elsewhere. ALU ORDERS PROMPTLY ATTENDED TO. -S ■■-■'.■ ' ,1