A/. .0^. ^*.^<> ^.^9^. IMAGE EVALUATION TEST TARGET (MT-3) 1.0 IIM 111112.5 ilM IIIII2.2 ' iiiM 2,0 1.8 1.25 14 III 1.6 % v] c^l c^^/^^^ ■c O^y w M Photographic Sciences Corporation 23 WEST MAIN STREET WEBSTER, NY. 14580 (716) 872-450:^ CIHM/ICMH Microfiche Series. CIHM/ICMH Collection de microfiches. Canadian Institute for Historical Microreproductions Institut Canadian de microreproductions historiqres 1980 Technical and Bibliographic Notes/Notes techniques et bibliographiquos Ttie Institute has attempted to obtain the best original copy available for filming. Features of this copy which may be bibliographically unique, which may alter any of the images in the reproduction, or wh'ch may significantly change the usual method of filming, are checked below. L'Institut a microfilm^ le ..^eilleur exemplaire qu'il lui a 6t6 possible de se procurer. 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Lorsque le document est trop grand pour dtre reproduit en un seul clichd, il est film6 d partir de Tangle supdrieur gauche, de gauche d droite, et de haut en bas, en prenant le nombre d'images n6cessaire. Les diagrammes suivants illustrent la mdthode. errata I to t ) pelure. on dt n 32X 1 2 3 1 2 3 4 5 6 SPEECH OF HON. S. H. HOLMES, PROVINCIAL SECRETARY, ON RAILWAY CONSOLIDATION, DELIVERED IN THE HOUSE OF ASSEMBLY OF NOVA SCOTIA, On January 26th and 27th, 1882. 9,P,P1 y.) //•'"■, 1 1 A, 5 ■^H SPEECH OF HON. IVEK. HOLMES o* Hon. Prov. SecretabTy moved the second reading of the bill for the Consolidation of the Nova Scotia Kailways, and iu doing so spoke as follows : In accordance with the announcement made yesterday I beg to move the second reading of the bill for the consolidation of the Nova Scotia Railways. I may say that the importance of this act has not been exceeded by that of any measure introduced into the Legislature of Nova Scotia since Confederation. It is important in a great many respects. The amount of money that it proposes to deal with is very large — larger than was ever dealt with iu any measure submitted to this Legislature, for it involves the expenditure of at least ten millions of dollars. It is also important iu regard to the interests which it is intended to effect, because its object is to consoli- date all the railways of Nova Scotia under one management with the view of making them more efficient in regard to the services they will confer upon the public, as well as to make them more remunerative to those operating them. Everybody will admit that the system of rail- roads at the present time in Nova Scotia is very incomplete, and that notwithstanding the very lai-ge suras of money that have been paid from time to time from the Provincial revenues, they have never yet yielded an adequate return for the public outlay upon them. If by any means their usefulness may be increased, and larger benefits received from, them it will certainly be a very great advantage io the Province, and that is the object which the Government have endeavored to accom- plish in bringing down this measure. , The histpry of railways in Nova Scotia is a very interesting one, apd i.t will be to pome extent neces- sary that I should refer to that history in order the more easily to make my explanations of the present measure. Of course, the history of our Provincial railroads before Confederation is a very simple one. All the railroads that were in existence when the British North Amei'ica Act was passed had been built by Provincial subsidies, and aa Provincial works. Before the time of the passage of the Act of Union another railway, that of the Windsor and Annapolis Railway Con^ipany, had been subsidized and was in procecs of construction. When the Pro- vinces were united all the railways belonging to the Government of Nova Scotia passed over to the Dominion Government, therefore there remained in the Province only one railway which did not pass under the control of the Dominion. Since the union of the Pi evinces the history of rail- roads in Nova Scotia is one of more interest, and I may say is more disastrous. The revenues that were left to the Province of Nova Scotia were from their nature limited, and it is very doubtful whether it was proper for the Province to have engaged i^ the building of railways at all, because the sum placed at the disposal of the people for local pur poses was not put there for the purpose of building railroads, but for the purpose of providing for other local works which were enumerated in the Act of Union. It' it true that the TProviqca receive^d power to subsidize what were called local railroads, but unless there were very strong reasons for building them, and a certainty that they would prove remunerative, and would not draw too extensively upon the revenues of the Province, it is evident that the voting of such subsidies must be a very unwise proceeding. Now, the first direct eflfort, I may say, that was made to construct railways, was made in the year 1872, when a resolution was introduced by the then Prov. Secy., Hon. Mr, Vail, providing for the construction of the railway from Yarmouth to Annapolis, and also from New Glas- gow to Antigonish, and from Spring Hill to Parrsboro'. The llesolution introduced upon that occasion provided that for the Western load a certain sum of money, with a certain number of acres of Crown Land, should be given. For the road from New Glasgow to Louisburg, there was to be given a grant of land, and also an amount equal to one-half the royalties which would be received from the coal mines in the Island of Cape Breton for forty years. For the Spring Hill and Parrsboro' road a grant of land was made and a sum of money provided. Nothing wos done under this Resolution, but very shortly afterwards r other measures were intruduced which resulted in placing these works in the hands of Companies, as I shall further on more particularly explain. I may state that at the time the Resolution was introduced, to which I have referred, a very long discussion took place in regard to the policy which the Province ought to pursue in i-egard to these railways, and there was a very great diversity of opinion upon the subject. I was a member of the House at that time myself. It was the first time that I had the honor of a seat, and I will, with the permission of the House, briefly refer to a few observations I made on that occasion. An amendment was intro'luced by the Hon. James McDonald, who was at that time a member of the House, and in dis- cussing the subject, the views of many of the membeis of the House, were put forth at gi'eat length. I wish to draw attention to the fact, that, _ on that occasion, the position in which we are placed to-day was Tery forcibly pointed oUt,' ahd th^re was then an outline given of the manner in which it wai' thoflg;ht .'best that the Provincial i-ailways should be aided by the Oo'vemtnetrt. On that occasion my remarks Mrere thus reported iu the official report of the debates : "He thought that ^^ufficient aid' could be givQn to enatle a Company to build a road, and that it might be provided that when the road beijame a part 6f the great International railway across the Continent, the money adviAnteed by the Pt-oy&ice of Nova Scotia should be returned, in order to be employed in its' ovrci. legitimate purpose — of constructing in the Pr^yince works that were of ai strictly locajl charapter." >' fact, was ^ the In that statement t^ore is to some extent an outline of the policy which the Government on the present occasion are submitting for the consideration of thi^ House, because we are about to make use of the road which from its importance and valuable character and from the nature of the interests we have since acquired in it can bo used for the purpose of obtaining money to be applied to the objects which are more required by the Province. As I have already mentioned vaiious Acta were introduced into the Legislature which resulted finally in giving to the Company which undertook to construct the railway from Annapolis to Yarmouth the sum in the first instance of $6,000.00 per mile which was subsequently increased to $8,000.00, with a land grant of 150,000 acres. And also iu order to aid that Company the Dominion Govern- ment made it a gift of the i-ailway known as the Windsor Branch, extending from the Town of Windsor to Windsor Junction. I need noi, refer to the Spring Hill and Parrsboro' road more particularty than I have already done as that road is not embraced in the arrangemont which T am submitting. After various tlToi-ts the railway knowr, at the prese)^t time as the Eastern Extension from New Glasgow to the Strait of Canso was contracted for, md the Company contracting was to receive a subsidy of .$8,000.00 per mile in round numbers. The real amount was indeed a fraction less than that, but for convenience I would name that as the sum. It was also to receive a land gi-ant of 150,000 acres, and from the Dominion Government the rail'.yay known as the Pictou Branch, extending from Pictou to Truro. Under these acts and under these contracts, these railways were commenced. The people of Yarmouth, as I have often said, to their credit, have themselves taken a large interest in this railway extension, its capitalists investing their money in shares and the township of Yarmouth also taking stock in the company to the extent of $100,000. The work on that road thus proceeded, changing hands, I think, once or twice, until at length the whole subsidy gi-anted by the Province of Nova Scotia was drawn, at which point all operations ceased, and it was alleged by the Company, and perhaps not without some truth, that the reason of that cessation and of their inability to proceed with the work was that the title under which they had received the Windsor Branch was made the subject of litigation, that Branch being an asset upon which they depended, and which formed a part of their calculations when they undertook the construction of the road. The consequence to the province was that some $700,000 was drawn from the public treasury while the road remained unfinished, — without a single mile being operated, no trains were running over it and it was utterly and perfectly useless in every respect. There was another railway also in the western part of the Province provided for, commencing with a subsidy of $4,000 per mile, which was gradually increased by a process of shortening the road until it amount- ed to $6,000 per mile, besides a land grant of 150,000 acres. Opera- tions were commenced upon that, road, but the contractors did not proceed far when some dis])ute arose between themselves and the Gov- ernment of that day, and they abandoned the work and went to the United States. Subsequently another party undertook to complete the work and continued his operations for a short time when he also coming to some misunderstanding with the Government, in regard to the method of drawing the subsidy was compelled to abandon the work and left the 6 country. Tn both cases the contractors left laborers and persons who had furnished supplies unpaid. The eastern railway was commenced in 1876, and its progress was continued until the fall of 1877, when by reason of .some misunder- standing botweeh the company and the contractor with whom they had agreed to build the road and perform certain other works, the operations upon that road were also brought to a stand still, and certain legislation was a})i)lied for by the company who owned the road, for the purpose of enabling them to issue bonds different from those provided for under the charter under which they professed to bo proceeding. The matter was brought up in this Legislature md referred to a committee, and the result was that the investigations of the committee disclosed the somewhat serious fact that the legislation in respect to that important work was so imperfect that the provincial interests were imperilled, and the securities which had been given to the Government for the comple- tion of the work wer^ found to be practically worthless. Yet the Legislature of that day, — not the present Legislature, — in giving the legislation required at that time, although they were made aware of the very serious and fatal defects which existed in the organization of the company, took no steps whatever to remedy those defects, and so mat- ters remained in that unsatisfactory condition through a large part of that year until about the middle of the summer, when some arrange- ment was made between the contractor, the company and the Govern- mede, and operations were temporarily resumed for a short time. The whole amount of money that had been expended by the Province at the time of which I am now speaking was very great ; in fact the funds at the disposal of the Province were completely exhausted. I now come to a point at which I wish to present a view of the position in which the present administration found the public affairs when they came into power, with regard to the railways of the country. A demand was made by the Eastern Extension Company, the Halifax and Cape Breton Railway and Coal Company, for a large amount of subsidy very shortly after the pi-esent Government came into power. The Government requested their law officer, the Attorney General, to make an examination into the constitution and organization of the com- pany, and his report was that the company was not legally organized and therefore it would not be safe to pay them any money. This decis- ion was communicated to the parties representing the company, and they were also told that as a company,, they could obtain nothing, but they wei'e willing to recognize the original contractor, Mr. Abbott, and would pay him the money to which he was entitled, tinder the contract, when he furnished the security which had been vitiated by the illegal act of the company, and which would be satisfactory to the Government. That of course so far prevented operations going on any further in res- pect to that road. With regard to the Nictaux railway the same demand was made by the piarties engaged in constructing it. Mr. Best, who came to this Province, made a large demand for -subsidy, and a similar investigation was held in that case into the condition of that company, and the man- ner in which the subsidy was paid out. That examination showed that according to the way in which the subsidy should be paid, the company . had been paid to the full extent of the work done, that there were bills outstanding against them fbr labor and su})plies ampunting to $20,000. illegal The Qovei'nment, therefore, decided that they would advance the com- pany 120,000 for the purpose of paying laborers, and parties who had furnished supplies, because \{ that had net l)een done, those nu-n W6uld be without their pay altogether. The sum of $20,000 was therefore put in the hands of an agent of the Government, and from his htfnds was paid to the various parties who had claims against the company for work done and materials provided. ' As to the Westera Counties Railway, Atthfe time when the present Government came into power there had been two years during which no work whatever had been performed on that line, and it was lying in the same useless and dilapidated condition which 1 have already described. It will therefore be quite evident that the prospect for our railways as it appeared to the Government at that time was not a very encouraging one. But there were other difficulties also which affected the question of our railways. The Province was in a very serious condition finan- cially. The examination into the subject recalled the fact that the annual revenues of the Province were diminished from what they had been during the preceding four years by no less a sum than 8200,000 a ye&r. When we reflect that the whole revenue of the Province had been about $650,000, it appeared to be a very serious thing that so large a sum as f '200,000, nearly one third of the whole revenue, had been lost to the Province. There were also obligations that the Pro- vince had to fulfil. It was found that at that time the sum of $2,000,- 000, which in 1 ^75 stood to the credit of the Province or Debt Account at Ottawa, had been nearly all drawn out, there remaining undrawn only $420,000. It was also found, in addition, that the Province was in debt in the sum of $350,000. There were then existing upon the Statute Book liabilities for the construction of tho following railroads — viz., the subsidy payable to the Nicfcaux and Atlantic Railway; of which there remained undrawn about $350,000 ; and of the Eastern Ex- tension subsidy the sum of $220,000. There were also acts providing for the construction of railways in Cape Breton, requiring subsidies amou ing to $550,000, and when we add to these amounts t'>e sum of $350,000, the Provincial debt, already alluded to, a very large liability was found to rest upon the Province, partly in the way of actual debts and partly in liabilities for railroads, the construction of which was provided for by acts of Parliament, the total liability amounting to $l,480,00i; ; and all that we had to the credit of the Province to meet it was $420,000, un- drawn on debt account. This left the Province in d' ot, for actual liabilities and liabilities to arise out of railways, provided for by statute, to the amount of $1,060,000, thus rendering the condition of our rail- ways a far more serious matter for the Government than it would have been had the Government found the Province in a good financial posi- tion, which would have enabled them to go on and complete the system. Bvit with these large liabilities, with the Province heavily in debt, and with no funds at our disposal, the prospect was certainly very hopeless and gloomy. I have now drawn your attention to the condition in which we found these roads when we came into power, J^nd also to the condition of the Provincial finances. The Jlouse will recollect also, that, although these large sums of money had been paid for the construction of railways in Nova Scotia, and provided for railways in Cajje Breton, the Province itself did not, at that time, possess any interest whatever in these rail- 8 -F ways, the Bubsidies to which I have alhuled being, in every case, presents nuuje tg the companies, the railways being entirely their own property. Very shortly after the Il^jifax and C&\ie Breton Company had made large demands for subsidy, to which I have referred, and which they claimed to be then due to them, the GoverQ- ment took the matter into consideration and caused an examination to be made into the condition of all the railways in the Province by the Provincial Jtlngineer and other parties competent to form a judgment. I have already described in some measure the condition in which the Western Counties Railway was found as regards its progress towai-^s completion and the character of the work done. It became necessary, therefore, to provide some way in which these railroads, after having been commenced and partially constructed, should be completed, and I will very briefly direct the attention of the House to each of these railroads and state what was their condition, and in doing so I am quite well aware that it will be necessary that I should repeat what I have perhaps said before, but I hope the House will indulge me if it is necessary, because otherwise I cannot very well give a connected account of the railway policy of the government. With regard to the Eastei-n Extension, it became quite evident that there should be some amending legislation before the Province could with safety proceed with the construction of that road, and the Hon. Attorney-General and myself proceeded to Ottawa, where we had a conference with the owners of the road and the Dominion Government, the result of which was that we agreed to pass the legislation necessary to place that Company in a legal position, and it was agreed that we should receive in return certain securities which had been vitiated by the proceedings taken before that time, and also that we should get better and more certain security for the completion of the work and the efficient working and management of the railway after construction than had existed at any time before. The result was that we agreed to put the Company oa a sound legal basis and also to legalize what they had already done. In return for which we obtained the concession on their part that they were not to ask for the Pictou Branch Railway until they had completed and finished their railway from New Glasgow to the Strait of Canso. By the previous conti'act when they had ex- pended the sum of $400,000 they were entitled to demand the Pictou Branch, and they had claimed that they had expended that amount and had made a demand for the Branch long before we came into power. We also further provided that after the road was built and completed, if they did not work it efficiently the road with all its appurtenances from the Strait of Canso to Truro, should revert to and become vested in the Government free from any encumbrance as a forfeiture. We provided therefore not only for the building of the road by the improv- ed terms we obtained upon that occasion, but also for its effective oper- ation afterwards, and the result was that legislation was entered into to , carry out the contract, and operations were resumed upon the road. rBy the terms of the contx-act they were required to have the road com- pleted by the 4th Api-il, 1880, but the Company did not in the view of the Government exercise that diligence which they should have done during the summer of 1879, because after receiving the amending legis- lation from the Pi'ovince of Npva Scotia there was ample time for them to have completed the road before the spring of 1880, and that they had not done so was their own fault. The amount of work that re- mained to be done was not very great, and it could have been done in much loss time than they then had at their disposal, but for some rea- son or other unknown to the Government they allowed one or two of the beat months to pass away without doing anything, and operations were not continued with that degree of speed which the province had a right to expect. They then api)Iied for an extension of time, but the Government did not concede them that extension eycept upon terms which I shall very briefly allude to again. I must now for a moment turn my attention to the Western Counties Railway. That road had been for two years previous to our coming into power in a state of decay — nothing had been done upon it — not a pick had been raised, I believe, at any rate no work had been done worth speaking of, and we considered it a very serious thing that $700,- 000 of provincial money should have been invested in a work which was yielding no benefit to the public. We thought it wise that we should arrange that the Government should be authorized to make advances of its credit to that Company, on receiving such securities for getting the line into operation, and after very serious deliberation the Government decided that it would be in the interests of the Province as well as of the Company to advance the credit of the Province to that Company to the extent of £55,000 stg., for the purpose of completing the road, taking a first lien and mortgage with powers of sale as security that the Province would not be called upon to pay the interest upon the guarantee loan, and if it was called upon to pay that interest the Government should foreclose the mortgage and sell the line. In addition to that, the Government took a large portion of the bonds which had been issued covering that portion of the road known as the Windsor Branch. We did so in order that we might be enabled to have a controlling voice in respect to that portion of the Western Counties Railway property also. Thus by having the entire control of the western division by means of our mortgage and a controlling influence over the Windsor Branch, we were able to control the whole Company. Under this legislation the Company proceeded to complete their line, perhaps not perfectly, but they completed it from Yarmouth to Digby in such a manner as to enable them to run trains from one port to the other, using steam connection between Digby and Annapolis, which was a vei'y great advance in getting the western part of the Pro- vince connected by railway with the centre. It therefore apjieared that up to this time the country was virtually getting back again some interest in, and control over those railways over which they had no control whatever when the present Government came into power. The Western Counties Railway wei'e not able to pay theirinterest as it accrued, and the Province had to pay it. It was quite evident that under the existing state of afiairsthe Western Counties Company would never be able to pay it. The pi'incipal shaieholders acknowledged their inability to go on with the road as they could not raise the necessary • funds, at all events until the lawsuit pending between them and the Windsor and Ajinapolis Railway Company was decided and unless it was decided in their favor. It was a rather serious lookout for the Pro- vince to be called upon to pay that interest, and it became necessary to see if that responsibility could not be avoided in some way. By that time, as already mentioned^ the Eastern Counties Railway Company, 10 th^i, is, the Halifax and Cape Breton Company, made a demand for an extension of time, and in view of the disastrous condition of affairs, especially as regarded railways, and also the financial condition of the country, the Goven^ment began seriously to consider whether it was not time if possible that they should devise some means of extricating the Province from these difficulties both in resf>ect to its finances and the raUroads. For that reason they declined, when the Eastern Extension Company asked for an extension of time, to grant it until they should look further into the matter. The result was that finally the extension of time was granted, but upon such conditions that the Pi-oviuce reserv- ed to itself the right to resume possession of that road, if at any future time any aiTangement should be made by which it could be .utilized in improving the financial condition of the Province. A Minute of Council to this effect was passed which has been read in the presence of the members of thi? House, upon which afterwards there was founded an agreement between the Company and tiie Government. The main fea- tures of the contract were that wit' 'n two years after thj completion of the road the Province should have L. 3 right to take back* from the Halifax and Cape Breton Railway Company by paying them their actual outlay in cash exclusive of all subsidies which the Province had given the railway, and also exclusive of the Pictou Branch. There were other features of the agreement tha^t I need not refe*' to, but they all looked to the same object. Under this new agreement the Company proceeded to finish the road. I can liardly say that it is finished yet. In part it is not ; and the certificate of completion has not yet been gi'anted txj the Company because on the last examination by the Pro- vincial Engineer it was not found to be completed. I think we have still two years in which this road may be taken over upon those terms. During the summer of 1880, after this Minute of Council was passed, no further progress was made with the Western Comities Railway, and during that summer it became a subject of consideration with the Gov- ernment what would be the best policy to pursue in I'especfc to these railways, and a report was made by the Provincial Engineer in reference to their cost and their condition, and with a view of assertainiug whether the interests posses.sed by the Government, and to which he had referred were worth anything, and whether it was worth while to re- tain those interests, because the time would soon arrive when those in- t zests >yould pass out of the hands of the Government, especially in the case of Eastern Extension, the rights of the Government with respect to which would cover two years after its completion. The Government had therefore to consider whether it would not be a wise thing to seek for a consolidation of the I'ailways. In looking at their past history we found that none of them had been successful financially, because they were worked by seperate Companies, and in some cases at a very groat diacdvantaga. Companies which owned lines connecting with one another refusing to allow the cars of one Company to pass over the line of the other, r^nd refusing to grant mutual privileges with respect to traffic arrangements, so that the roads were unremunerative and the public was ill served. Great inconvenience was thus caused, particu- larly to the Western part of the Province, whose trade was seriously embarassed by the refusal of the parties controlling the Western Coun- ties Railway and the Windsor and Aijnapolis Railway to co-operate .with one another. He thought it har^ that after the Province had 11 given so much money to these roads they shoukl continne to operate them not only to their own disadvantage but to the disadvantage of the Province. The "Windsor and Annapolis Railway was also complaining that its railroad was not paying, and it became necessary in the interest of that road, before our accession to office, that they should come to this legislature and obtain the credit of the Province to the extent of £50,- 000 sterling before they could ^n on with their road. They stated, that unless they could get that loan of credit from the Province in the shape of a guarantee of their bonds, they would be compelled to clofse their road. Now when a railroad is once built it is the next thing to impossible that for any reason or on any account it should be closed up, and therefore the Province was forced to yield its credit to the extent of £50,000 to the Windsor and Annapolis road. For that guarantee they had no security to offer. Shortly after we came in power an application was made by the same Company for an additional guarantee to the extent of £25,000 sterling, the Company alleging that unless they got this concession they would be very seriously embarassed, and that the Province would have to pay intere.st on the £50,000 already guaranteed. The Government refused to guarantee the amount unless they could furnish security to the' satisfaction of the Govern- ment to protect the public interests. Their reply was that they had no security to give. There was, therefore, a Company that announced itself to be in such a state that it could not carry on its work, and was on the very verge of bankruptcy. We found that the Western Counties Railway was unable to pay its interest, and the Province was called uj)on year after year to pay interest in London upon its bonds. These two roads in the Western Province were thus in a bankrupt condition, not because there was not trade enough in the country to make them prosperous, but because they wore in a dis- connected and disjointed condition in which it was impossible to work them to advantage, and they refused to co-operate with each other in such a way as to make their roads remunerative. The Province was therefore in constant danger of being ajtplied to by one or other of these Companies to lend its credit, and lending its credit was almost equivalent in the case of Companies placed in such a condition as that, to advancing the money at once. The lailways to which I have directed attention comprise what may be callec' the trunk line of the Province, extending from one end of the Province to the other ; but thei'e is anot!ier railway to which I have referred briefly, the Fictaux and Atlantic road. Tliat railway remained in the condition I have already desciibod. Various applications were made by the company to enable them to go on with the road, but the Government of Nova Scotia never had any sub- stantial guai'antee that the parties proposing to go on had the means to cany the work to completion ; and until there was such security provided, they did not deem it advisable that the Province should pay out of the remaining part of the subsidy, unless such conditions were imposed that there should be a certainty of the road being completed and efficiently worked after it was built, and that the Province' khould , not be the loser by the transaction. . *' Und^r all these circumstances the Govei'nment had deemed it wise to communicate with capitalists in the United States, in Canada, and in England, and a circular was prepared, giving a brief description of the 12 railways, and also an account of their cost, and of the advantage they seemed to oflfer if consolidated into one system, and operated by a pow- erful comjmny. The circxilar was also addressed to the owners of all the railways in the Province, and to parties in I^ew York, whose names I cannot recall, but will fnrnish to the House at a future time. All the companies owning railways in Nova Scotia were invited to examine into the possibility of consolidating them into one system, and the Government informed them that they were prepared to receive offers for such a scheme. I ougl)t to have mentioned at an earlier stage that the power of ac- quiring the Windsor and Annapolis Railway is also in the power of Novfi^ Scotia, because by its charter it was jjrovided that the Govern- ment of Nova Scotia by Order in Council might at any time have that road by paying either in cash or in Provincial debentures, its value to be ascertained by three arbitrators, one to be chosen by the Company, one by the Government, and a third by the Seci-etary of State. It will thus be seen that the Province at this juncture had the power to acquire the road from Truro to Canso by the arrangement I have referred to with the Halifax and Cape Breton Railway and Coal Com- pany, to acquire the road from Yarmouth to Annapolis by froeclosure and sale, and to acquire the Windsor and Annapolis Railway in the manner mentioned. There therefore remained one gap between the two different branches of the system, and in order to make these two rail- ways one, extending from the east to the west in a continuous line, it would be necessary that the province or the company which would un- dertake their consolidation, should receive from the Intercolonial, run- ning powers from Truro to Halifax. Communications were therefore opened up with the Government, and after some time, running powers were obtained from Truro to Halifax, and in that way the Govern- ment were put in a position to deal with the parties with whom they were negotiating, and to place at their disposal all that was necessary to effect a consolidation of the railways. These running powers were ob- tained from the Dominion Government practically in Januaiy of the year 1881, at which time, in company with some other members of Government, I went to Ottawa for that purpose, and obtained the pro- mise of the Minister of Railways that running powers would be granted .to the Government, or its assignees. It will be in the memory of the ;Hou3e that shoi-tly afterwards, the Minister of Railways became very ill, aand was obliged to leave for Europe. In fact, he became ill before he swas able to have an arrangement for the granting of running powers • carried out, and that fact delayed action being taken in this House last ■winter, on this im])ortant subject. The House will recollect that the : subject was alluded to in the Speech at the opening of the Session, and . some further steps were taken in the House. By that time several offers had been received, but none of the parties who had offered, could close with the Government until they had ascertained on what terms running powers could be granted by the Dominion Government, over the line betw^n Truro and Halilax. The negotiations were therefore kept '. open fei" that reason. Under those circumstances it was quite evident that the House woulrf be unable to deal with the subject during the Ses- • sion, and towards the close of the Session, the matter was brought to the attention ofrtihe Legislature, and the reasons stated why the delay had : arisen, andithe following Resolution wai unanimously passed by the House of Assembly. I will read the Resolution, because it conveys tlie unanimous will of this Legislature, wit?!, regard to the course which they desired the Govei'riment to pursue. Wherers, "The Province d Nova Scotia possesses certain interests in the railways hereinafter mentioned, as foUowB : — " First — The right to acquire the railway extending from New ilasgow, common- ly known aa the Eastern Extension Railway, together with the railway extending from Truro to Pictou, known aa the Pictou Branch. "Second — The right to acquire the Windsor and Annapolis Railway with all the privileges and franchises pertaining thereto, according to the provisions of Chapter 13 of the Acts of 1865. " Third — Certain powers of disposing of the Western Counties Railway and all its franchises. "Fourth — The right of acquiring the Windsor Branch Railway and running powers over the Intercolonial Railway, from Windsor Jmiction to Halifax. f* Fifth — The right to acquire the railway extending from Middleton to Lunen- burg. " And ichereas, negotiations are in progress betv/een the Local and Dominion Governments for obtaining certain privileges on and over the Intercolonial Railway between Truro and Halifax, with a view of obtaining continuous railway communi- cation between the Eastern and Western subsidized railways of the Province; " And whereas. It is desirable to utilize the powers above referred to, with a view to the consolidation of the said railways under o le management, in order to ensure their more efficient and economical working, and in order to restore to the Province as large a proportion as can be obtained of the moneys advanced for the construc- tion of the said railways, by a sale of the interest aforesaid; Be it tlierefore resoltied. That the Government be authorized and empowered to enter into negotiations with any ^)ei'8on or persons or corporation for the purpose of eftecting a sale of the interests possessed by this Province in the said railways or any of them; and to contract for such sale upon the best terms that can be obtained therefor, having regard for the ability of the contractors to carry out their engage- ment and to furnish satisfactory security therefor, and to contract for the comple- tion of such roads and any of them, and for the construction and working of a rail- way on the Island of Cape Breton to connect with the Eastern Extension Railway and ferry at the Strait of Canso, Any contract to be made under this Resolution to be subject to the approval of the Legislature." That was the policy not of the (.rovernnient but of this House of Assembly accepted by utianimous vote. Now in consequence of the abseiice, and illness of ihe Minister of Railways us already referred to, running powers were not obtained until late in the month of May, when the final arrangement was entered into be- tween the government of Nova Scotia and the Dominion Govern- ment, by which, under an Order in Council, running powertj were granted over the line from Truro to Halifax. By this time, as you are already aware, an agitation sprang up in the town of Dartmouth with the object of obtaining direct communication with the Intercolonial Railway on the other side of the Harbor by a railway extending somewhere from Windsor Junction into that town. About the same time there was another agitation in the town of Pictou tor the purpose of obtainin^direcfcommunication between that town and the Intercolonial Railway by land instead of by water. The town of Dartmouth finally voted a subsidy not exceeding $4,000 for 20 years. I was down at Pictou last summer, and it happened that the Minister of Railways was there also, in fact, as the House will remtsmber, theje was an election going on there at that time. The Railway Committee asked for i4 an interview with the Minister of Railways, and I was also asked to attend. They wieht-d the Dominion and Local Governments to take up the matter and connect them directly with the Inter- colonial Railway by land, and they agreed if that was done to re- lieve the Railway of the working of the ferry between Pictou and the Intercolonial, which cost nearly $12,000 a year. Aftf^r dis- fcuf-sing the matter for some considerable tiliio the Minister of Railways said that he would be willing to aid that road to the ex tent of furnishing the railway iron. They asked me what 1 would do, and I said I could noi do anything, and would not do anything in the way of a subsidy, boeau.se I thought it was per- fectly absurd for Pictou to have two railways at the public ex- pense, when there were other counties in the Province that had no railway at all. But I said that the Government of Nova Scotia were engaged in an effort to consolidate the railways of the Pro- vince, and I would see if they would not include in their scheme the building of tnat road on condition of being relieved of the working of the ferry and getting the railroad iron, as already stated. A.t the same time 1 received a telegram fr..m parties re- presenting Dartmc/uth, and I replied to them that we were en- gaged in a scheme for consolidation, and if we could succeed in getting that railroad includmplaint that it was not adopted. ' Now, there is an6th6r poiijt up ^n which I will just say a word or two, find that is in reference t > the charge that the time for the cont-ideration of this matter provided oy the contract is too shurt — I wish to explain how that aro^e. The contract' appears on its face to be dated, and is dated the sixth day of September, 1881. It was signed on that day, but there was a month given at that time before it would be cnsidered as binding on the Gov-' ernment, the reason being that there were certain other parties making offers and complaining thatthoy had not had sufficient time to complete theif Offers, so that in order to avoid any caused of complaint wo gave th^m an additional month to look further isto the matter and make their tendei*. They did not, of course,' know that the contract had beert entered into because we could' not tell them, but yet wo informed them that an arrangenrient was! made, and thut if they did not put in a better offer it would be' adopted. Thex-efore the sixth of Oct' ber instead of tho sixth of Septtmber was the time when the contract actually took effect. Still it was thought that there would be ample time to o.-jable tbe House to be called together in the month of Dooember, Or at all events not later thrin the ^rst of January ; but in a transaction' involving ten millions of dollars it is not to be Wondered at that' the labor necessarj'- to perfeit the oriranization of the tnatlter in London should take longer than wa*^ ^anticipated, and the fact was' it di close the contract in the eyes of the world there would be ^reat danger that the rivals of the successful competitors who were di«- H pleased at not obtaining the contract, but whose tenders could not Be reoeived because they were not as f|»vorablo, mii^ht go into the London money market and create such an. agitation, oven in one day a^ would perhfips pi event capitalists in London from inve-«t- ing their money and coippleting the ai.'jre^axent. Suppose that some such articles as appear in the " Mprning Chronicle " had ap- peared in the " Times " or some influential journals it would very Bopn destroy the scheme and frighten away capitali^t8 proposing to invest their moo^y. It is not RCceR^iiry therefore to say another word on those points to expose their iibsurdity. The charge of a change of policy is also unfounded. I never proposed that ihe Government should take all the railways in Nova Scotia and buWd and run them. It is quite true that at the time when the late Government were providing for the construc- tion of Eastern Extension, I preferred tnat ihe Government should take that road and build it itself, rather than pay the immense subsidy that the Government were proposing to pay of $8,000 a mile, together with 150,000 acres of^ Crown lands, oesides pre- eentiog the company with one of the most valuable railways in the Province ; the railway from Pictou to Truro, running as it doctithrougb a fertile country and through a large mineral dis- trict, and i believe that with auch large subsidies as these, it would have been a far better policy for the Prpvinco to build the road itself than to pay all these subsidies J,o a corppany which should own the roads and leave the Province no interest whatever in them. The fact is that the subsidies granted were sufficient to build the road twice over. The result has justified my views and proved them to be perfectly correct, because it is by reason of having got back that property that we can offer to the people a consolidation of their roads, which any man who had ventured to predict three years ago would have been considered a madman. There is one other little private matter to which I shall allude, and then I shall proceed to the cunsideration of matters of more importance. It is very rarely that 1 allude to the newspapers in this house ; I do not think it ii* a proper thing to do usually, be- cause hero we have t^e say pretty much on one side. On this occasion, however, I shall .depart from the practice I have hithei'- to observed, and notjce an article which appeared in the " Morrv ing Chronicle " yesterday, and which is repeated in that paper to-day. The "Morning Chronicle," in discuesing this railway question, makes the following statements : . j " Now, it has come to 6ui' knowledge that Sir Charles Tupper has lately cluuaged his views on the subject of the Eastern Railway, that instead of giving up the Pic- tou Bninoh to the Halifax and Cape Breton Company, as formeriy proposed.] or to the Syndicate, as the Local Government now propose, he would like to bold the Branch, buy, out the Halifax and Cape Breton Company, pay the Province in cAsh for it^ interest in the dew road, and make the whole line part of the Intercolonial. We have it on the best authority that Sir Charles has so stated his views, and. farther, that but for the interference of Mr. Holmes and his wild Syndicate scheme, this would now be the declared policy of the Dominion Government. If Sir Charles Tupppr held this view a little while ago, and we are in a position to assert that he did, he would, we presume, hold it again upon the way being cleared by* the defeat ^ the Syndicate scneilie. " ' » "The Eastieni people have everything to gain by defeating the Sjmdicate scheme a&d calling on the Dominion Government to cury on the policy pi-opoeed by Sir ii lid not 1 to the in one invo'^t- 10 that aad ap- Id very sing to mother t never nNova at the )n8truc- I should mmense 88,000 ies pre- «ray8 in \g as it eral dis- these, it luild the y which whatever [Icient to ows and eason of people a tured to idman. 1 allude, of more lapors in ally, be- On this hither- '• Mornr t paper railway ate Bcfaeme ed Vy Sir Charles Tapper. The Western people akc have much to gain, for by the adoption of that policy the Province would receive from the JOominiou Qovomment about $650,000 in cash for its outlay on the Eastern Road. With this money in hand it would be able to grapple with the misting link between Digby and Annapolis and aid a scheme for the consolidation of the Windsor and Annapolis and Western Counties Roads. " " Let the legislators and the people examine this Scheme in comparison vtrith the Syndicate's, and judge which is to be prefened. The plan we present as a substi- tute for that of the Local Government is perfectly feasible, un'less Sir Charles Top- per's words were meant to deceive, which Mr. Holmes and his followers will hardly assert. " These are extracts from an acticle which appeared yesterday morning. This morning the " Chronicle " had the following as- tounding statement : " We are in a position to assert that Sir Chatles Ttippir had, before the appear* ance of this Syndicate scheme^ declared the purpose of the Dominion Government to hold the Pictou Branch, buy out the Hailifax and Cape Breton Company, pay $650,000 TO THK Province,, and make the Eastern Railways part of the Intercolo- nial. Defeat the Syndicate 8cli hundred pounds sterling per annum (or about two hundred and twentj'-five thoueand dollars), together v/ith an additional sum of eleven thousand one hundred and fifty- three pounds sterling per annum (or about fiftj'^-six thoustnd one hundred and twenty dollars), payable half-yearly, for a period of forty-one years in London to the order of the Government of Nova Scotia, as a Sinking r'und to redeem its guarantee hereinafter referred to, and the Gov^ernment shall be a party to such deed, and the deed shall also coiitain provisions and stipulations for the payment by the Government of the sai'l first named sum of forty- six thousand two hundred pounds sterling, when the same shall come to the hands of the Gov«*rnment for interest on the Com- pany's securities, to be guaranteed by the Province as hereinafter specified, and also containing stipulation-'for thi-^ application of the second named sum of eleven thousand one hundred and fifty-three pound sterling by Goverrmient, when the samo shall come to the hands of the Government either as a ninking fund for tl e redemp- tion of the said Government Guarantee, or as otherwise provided in clause 25 hereof, and also containing provisions to secure the continuous operation of the sai i railways. That mortgage is to be delivered to the Government at the very time when the transfer is m do from the Goverment to the Com- pany. The object of excluding the lands to be granted to the Company from the mort .age will be quite apparent to the Ho;ijse, bec.iuse if they were included in the mortgage the}- could rot bo disposed of, and the object of the C'mpany is of course to dispose of them and settle them for the benefit of the Company and of the country at large. Thei'e are three thitigs provided in that mort- gage, first, that the interest guaranteen It is provided in this section that whenever this con tract Ih ratified by the Legislature, (I have already explained that the time limit to the fir.->t of Feb. has been extended by the Com- pany) anci all the legislation necessary to carry out the contract is passed, "then the Company shall immediately furnish such other sufflc'ent security as the Governor in Council may require for the due and proper performance by the Compa ly of its obliga- tions, as speeifie i in clausep, 1, 2, 3, 4 and 7," — that is the whole undortakiiig ot the Company. Mow, let me turn your attention for a m "ment to the 5th section of the charter of the Company. After several other particulars, it prov!de.s that for the purposes of this agreement, that is, for the working of these railways, etc., "at least the sum of five and a half millions of dollars, as men- tinned in the receipt hereunto prefixed, including the previous payment of £52,000 sterling," shall be paid, provided or applied by the Compary j and that the Company shall also cause to be paid, provided or applied, such further amounts of its capital as may be required to provide the sinking fund referred to as well as any other provisions of said agreemvnt. Now you will observe by the terms of the contract that until that security satisfactory to the Government is deposited with the Government, no single step is to bo taken to render the Province liable for a dollar, or for any of the ohligations which it assumes in the Contract. Until thai money $5,500,000, and such other security as may be required is deposited, we are not to assume any responsibility whatever. Now, that is a very important matter, and ij^ overlooked by those who 0' itici.se this measare, they shut their eyes to what is good, and continually harp upon the imaginary grievances that do not exist. I have been amused at the criticisms which this mi-asure has met, knowing that the Government have taken such care that there is not a single objection raised by those critics that has not been foresecu and guai ded against by the Government ; and I think that we have a right to congratulate. ourselves that we have so successfully closed every avenue that they cannot find one single argument against it. It is '■'^ipossible, a« I have said, that any liability can be incur- red by the Province until this security is in the possession of the Province. Now how has that been carried out so far? Let me for a short time direct your attention to the receipt which is an- nexed to and forms a part of this Act. When you look at that receipt you will acknowledge that it is not very oflen that such a receipt has been signed on behalf of the Province of Nova Scotia, in fact it has never been done before and I don't know whether it will be done again I will read tte receipt because it is import- ant that it should be road. It is as follows : iilf 26 Received the 26th day of November, in the Year of Our Lord 1881, from Messrs. Baring Brothers & Co., the sum of fifty-two thousand pounds sterling, being the payment referred to in the Agreement dated the sixth of September, 1881, between the Government of Nova Scotia and Edmimd Walter Plunkett. This paymeni co made in consideration of said Agreement being extended, modified and defined by mutual consent, (and without prejudice to any of its other provisions,) as follows : — First, — The time for making this payment is extended to this late. Second, — The construction of the new line A, specified in said Agreement, shall be optional with the Nova Scotia Railway Company. Third, — the Provincial guarantee referred to in said Agreement shall be deliverable to Messrs. Baring Brothers & Co. or order, any time after the Legislature of Nova Scotia shall have ratified said Agreement, but not until the Government of Nova Scotia shall be satisfied that the sum of at leabt FIVE AMi> A HALF MirxiON D0LLAB8 cash, Canada currency, or the equivalent thereof in Government or other bonds or debentures, approved by said Government, shall have been provided for the purposes of said Agreement, and deposited or other, wise secured or applied to the satisfaction of said Government. In case of the non- ratification of the above mentioned Agreement of 6th September, 1881, by the Legislature, the said sura of ^652,000 wijl forthwith be repaid to Messrs. Baring Brothers & Co., with interest at the rate of five per cent, per annum as stipulated in said Agreement, or Messrs. Baring Brothers & Co. will be released from their under- taking to hold the same on behalf of the Government. . S. H. HOLMES, Provincial Secretary. Now in connection with this I wish also to draw your attention to the 26th clause of the Agreement, which, if anything were wanting to make this matter doubly secure, supplies that want. I will read the section, which is as follows : 26. The security provided in clause 13 to be given by the Company to the Government shall be from time to time reduced and returned to the Company or its assigns as and in proportion to the completion of the Company's undertakings under this Agree be a sufficient answer to those who make these objections. By the terms of the Act, the Government has not oply the power of fixing the tolls, but also to compel the Company to make traffic arrangements with any other Company which may connpct with its lines, aqd,)f they refuse to do so, the Government cai^ make the traffic arrangements themselves, which furnishes another and an additional guarantee against any pQisiblity pf a monoply arising out of the passage of this Act. ,,.. it;, i . 29 There is another point to which I wish to refer in this connection, and I would like the people of Nova Scotia to answer this question for themselves : Will tliey not feel more secure in regard to the benefits which would be conferred, and the security which Would be afforded for their interests by having the roads under the control of the Local Government than by having them under any other control 1 The Local Government is the Government of the Province itself, — the Govern- ment of the people which they can make or unmake as they think jjroper. What better guarantee or security do they want, or how could they feel more safe or better satisfied than by knowing that they were under the control and piotection of a Government which is their own creature in every respect, which they can create to-day and turn out to- morrow, just as they think tit, or as they deem them worthy or un- worthy to hold their positions. Some people seem to think, and I do not know but that there may be good reason for t^eir thinking so, that they would be ti great deal safer if these railways were owned by the Dominion of Canada. I think myself that it is a very doubtful propo- sition. It may be that while the Dominion Government is friendly to Nova Scotia; as it is at the present time, while it is strongly represented in the Councils of the Dominion, the views to which I have referred may have a good deal of force. Bxtt the time may come when it may be altogether different when a new Government may arise that knows not Nova Scotia, and cares not for Nova Scotia, when the interests which it may seek to promote may not be identical with those of this country. In such a case we would find oui selves helpless and powerless. It is quite true that we have our proper and legitimate representation, and if we take care to send good representatives who will not be afraid to stand np for our interests in the Dominfion Parlia- ment, we can easily secure our rights, but at the same time if we consi- der the jjrotection that is offered to us by having these important interests ui^der the charge of the Local Government there is no con. parison whatever. And although I would like to see the Dominion Government retni-n us all our money and build all our railroads, I do not know but that on the whole we are doing better than if they were to do so. There is another point to which I wish to refetr while speaking of tne security the Province has for the due administration of these inter-', sets, and that is the character of the Company that has undertaken to carry out and complete the undertakings. It consists mainly of English capitalists, whose names have been already read in the hearing of the House. In regard to these gentlemen I shall take th6 liberty of reading an extract from a letter received from the solicitors of Messrs. Baring Brothers, in which they write as follows : — uf Vi.n Sir Henry Tyler as you are no doubt aware is the Chairman of the Qnind Trunk Railway of Canada, and we think will be a very useful addition to the Board. Mr. .1. W. Batter is a gentleman of experience and is on the Board of several companies in London. Lord Ashley is the eldest soul of the Earl of Shaftesbury, K. S., and ts a man of high character and influential position. Lord Colin Campbell, M. P., is a brother of the Governor-General of Canada. The Hon. Norman Grosvenor, late M. P. for Chester, is the eon of Lord Bury, and both the latter gentlemen are of liigh chhracter.and sound position." i Hero then is the character of the English capitalists who haVe undfer- taken to come to the Province of Nora Scotia and invest their money 80 in its public works and railways. You have seen that Baring Brothers have advanced £62,000. That money is in the Treasury of the Pro- vince, and they cannot get it back unless the whole sum of 85,600,000 is paid into the Treasuiy. Now, it has been said by some persons that this will all be withdrawn, but any person who reads the Contract and the Act, or who is aware of the facts as they have been before the public for a long time, will not venture to say so. Messrs. Baring Brothers are known to the people of Nova Scotia. They have had dealings with us before ; they are the men who, from the time when Nova Scotia Idrst began to build Railways, have advanced the several immense sums of money necessary for their construction. I think I am correct in saying that they advanced the whole amount, or, at all evente, by far the larger part of it. This firm, therefore, knowing the Province of Nova Scotia, and being acquainted with its public works, which they themselves assisted in constructing, have agreed to advance the money to the Company of English gentle- men, whose names stand beyond reproach in all the walkij of life, and they have become the bankers of the Company. Directors of the Com- pany have been appointed in the Province ot Nova Scotia, four Nova Scotian gentlemen having been chosen as Dii-ectors, in whose hands will be placed the practical management of the enterprise, because the Act provides that the business of the Company, that is, the business of managing all these railways, and seeing that they are effectually worked, is to be carried on in the Province of Nova Scotia, and not in England. These capitalists and bankers have therefore paid the high compliment to the people of Nova Scotia of choosing these Directors, and in doing sp have given us an assurance that they intend to work these roads in a bona Jide manner, aqd in the interest of the people of this countiy. What better security could the Province have tor the efficient and satisfactory woi'king of the enterprise than the fact that they have selected such men as I have referred to for the purpose of managing this vast entei'prise, wnich is almost equalto half the Pacific Railway itself, and almost equal to the Intercolonial Railway in I'egard to the length of road and the importance of its chai'acter as a commercial work. Now, we sometimes hear a most wonderful objection urged by the opponents of this scheme, and that is that these Railways will be found to be a worthless lot of rubbish, tbat no man would giv© a dollar for. It is somewhat inconsistent to find the very same people saying almost in the same breath that the Government and the Legislature of Nova Scotia are about to sell th<^ most valuable assets of the Province for a song. Of course those who will not and cannot speak the truth cannot at all timea be consistent. There is one way of being consistent, and one way only ; that is, to t«ll the truth, and if a man makes up his mind to tell lies and at the same time be consistent, he undertakes that which no man can ever successfully accomplish. We find, therefore, that those who urge the specious objection to which I have referred fall into the difficulties always experienced by those who make up their minds to prefer a lie to the truth. Now, do you think that those men whose names I have mentioned, including, the chairman of the Grand Trunk Railway Company, do not know what kind of a bargain they are making, or that they are entering into an enterprise which will require an expenditure of some nine millions of dollars without knowing what they are doing. The id«!a is absurd. If these railways 31 are really worth nothing then I think the Government of Nova Scotia may claim the credit of being very clever people, if they have succeeded in pulling the wool over the eyes of Mr. Plunkett and such eminent capitalists as compose the Directorate, and in addition have also inveigled into the scheme such men as the Baring Brothers, who are among the first, if not the first bankers in the world to-day, whose word given for the obtaining of any amouitt of money or the perfonnance of any obligation that they may undertake, will be taken before that of any man or Company on the face of the world to day, not excepting the Rothschilds, — then t think that the Government can claim, as I have said, the credit of being remarkably clever in the conduct of their nego- tiations. These are the men that we have been so astute as to hood- wink into purchasing a lot of nibbish called railways, and these aro the men from whom we are about to extract nine millions dollars in canh, for which we are only to become liable for $73,062, representing about a million and a half of capital ; and that is the story which these people ask the membei-s of this House and the people of this country to believe. Was ever anything more absurd on the face of the earth 1 1 do not recollect ever even reading of anything so absurd. Now, it may be said, and has been said that this is all very good for the Province of Nova Scotia, but that, if it is good for Nova Scotia, it must be as bad for the Company as it is good for the Province. I dis- pute that position entirely and absolutely. I say it is a good bargain for the Province, and it is just as good a bargain for the Company. 1 have already shewn that about nine million dollars have been expended in the construction of the several works that they propose to acquire — even if we estimate those roads at half that amount. That is a very considerable sum ; but the House must recollect that in this bargain there are two great presents for which the Province of Nova Scotia pays nothing, and which go to the benefit of the syndicate. We know that the Pictou Branch Railway, from Truro to the Town of Pictou, a railway extending 52 miles through one of the best districts in the Province of Nova Scotia, or in the Dominion of Canada as respects its paying qualities, because it runs not only through a thickly peopled country, but through a country abounding in sources of traffic, consist- ing of inexhaustible supplies of minora} wealth, yielding a perpetually increasing traffic, becomes the property of this Company under the terms of the contract. That was a railroad which the Dominion Gov- ernment threw into the hands of men who were incapable of making use of it for the benefit of the Province, but which this Government and this Legislature have succeeded in recovering for the Province. Again, there is another large present, consisting of the Windsor Branch, which is practically thrown into the hands of the Company and ensures to their benefit. These are extensive and valuable roads, built by the Government, running through the territories yielding the best returns made by railways in the Province of Nova Scotia, besitles which the Syndicate will also have another large gift which, although it does not cost the Dominion Government anything, nor the Province of Nova Scotia, will be extremely valuable to the Syndicate — that is the running powers granted from Truro to Halifax, upon terms so favorable that it is almost equivalent to their owning the road itself. Here then we have the Pictou Bi-ajach, 52 miles, running powers over the Truro Road, 62 miles, and the Windsor Branch, 43 nules, making in all 157 miles 8^ of railway, the greater part of M'hich will be absolutely, and all of it practically at the service of the Syndicate. It is owing to these advan- tages and powers acquired by the Government of this country, step by step, that we have been enabled to make a bargain under which every imix)rtant interest of the Province is protected, and the Syndicate is able to make us a payment of $1,850,000 into the bargain. They know perfectly well that these roads* are going to pay, because they form a l)art of what must be the Grand Trunk line that will at some time, before long, become the highway of travel between America and Europe, and all of them run through valuable districts of the Province, which promise them handsome returns for their outlay. If this were not the case it must follow that those roads ought never to have been built, and that the building of them was a mistake. I had thought that the peo- pie who had cherished these views had long ago departed, but I find that some of those fossils are still remaining who insist that these rail- ways are not and never will be a paying speculation. If I thought so myself I think I would pack my carpet-bag and go somewhere else, where railways do pay, because I do not think there is a place in the world where, they do not pay and cannot be made to pay, except this wonderful Province of Nova Scotia. In all other parts of the world, they not only pay expenses, but make money for their owners, even whore they have cost much larger sums than these roads are going to cost the Company that proposes to taice them. Several causes have conspired to enable the Government to negotiate this bargain. The House is well aware that at the present time a large amount of money, which used to be invested in Eastern and Asiatic securities, has been withdrawn. Formerly British capital used to prefer such securities as those, and there was a prejudice against the invest- ment of any money in America and particularly in Canada, which extended itself to Nova Scotia as well. Now, if this enterprise had been launched a number of years ago, or even perhaps two or three years ago, it would not have been successful, simply becauie of the deeply rooted prejudice in regard to the value ot the Canadian enterprises and securities. The railway experience of the Dominion has been somewhat unfortunate, and has tended, no doubt, to prejudice English and American capitalists against investing their money in them. But it has recently turned out that railroads, which formerly were a burden to their proprietors, are now yielding handsome returns, and a revolu- tion has taken place in the opinions of capitalists with regard to such investments. Owing, therefore, to these causes I have mentioned, to the accumulation of capital, which formerly sought investment in ea.st- ern securities, to the removal of prejudices that formerly existed against Canadian investments, and to the fortunate position of our pub- lic works, which has been brought about by the efforts of the Govern- ment, we have been enabled to attain the happy result embodied iu the bill now before the house, which I believe, will be productive of very great benefit to the Province of Nova Scotia. Let me now enquire for a few moments what tl^se roads are costing the new Company. We know that some of the roads built ly the Province of Nova Scotia cost $50,000 a mile, and hardly any of them cost under $40,000. Latterly some have been built at a lower rate. I have shown you that these roads have cost in all about ^ $9,000,000. I do not know the exact figures ; and nobody known, as I htt^e- ailready all of it 3 ad van- step by 3h every (iicate is 9y know y the of them wer rate. ,000,000. e ailready ' said, — but I think that $9,000,000 may be assumed to be the amount which will be required to enable the Company to purchase the existing lines and complete them and build new ones. At any rate it will not vary much on either side from the sum I have named, i^ow the length of railroads which they will then o^n, exclusive of the Nictaux and Atlantic road, should they not tdko up that line, will b« 450 miles» making an average cost of $20,000 a mile, for which cost they are iO' obtain a system of railways extending from one extremity of the Pro- vince to the other, and running through all these most valuable and fertile districts. I think that it is a j)retty fair bargain, but I think we may iairly add to that the running powers between Truro and Hali- fax, a distance of 62 miles, making their total railway system 612 miles, which will bring the average cost something below $18,000 f^ mile. So that when this bargain comes to be looked at in all its details, and everything in connection with it is taken into considei'ation, I do not think there is room to assert that it is a bad bargain either for the Com- pany or for the Province. At all events I have no doubt that those who may live even a very short time, say ten years from this date, will have the satisfaction of seeing these roads paying handsome dividends upon their outlay, and conferring great benefits upon the Pi-ovince, and should I then be living, I hope that I may have the pleasure of referring to the statements that I am now making. I am sure that we will not be very much put out if those croakers who are predicting misfortune for the English capitalists, and who in the same breath prophecy mis- foi-tune and calamity for the Province of Nova Scotia, are disappointed as to both predictions. If they should prove to be false prophets there will not be very many tears shed, either hei'e or elsewhere. Now, the Government are not in a position to give such complete- and authentic details of the earnings of the existing roads as would en-, able the House to make an exactly correct estimate. Under the Nova Scotia Railv.-ay Act, among other things which I think were beneficial' to the public interest there is a clause which provides for a monthly re- turn of the trade of the roads. Before that ^ ct was passed we knew' nothing at all about them. We did not know whether they were pt^y- ing or not. They might be earning iinmeiise sums of money fbr all that, we knew, but if we inquired into the matter they were al?le sometimes to laugh in our faces or to intimate that we were asking iinpertinent^ questions. Since the passing of the Act of 1880 the Government has been in receipt of returns which may or may not b6 accurate, but we have done the best we could to obtain accurate knowledge. No doubt, some people can swear to very wonderful things and others have means of concealing the real truth, but at all events we have enabled the country to have some, kpovvledge of the nature of the railways which i it has so heavily, subsidized. Now it is impossible to obtain a Strictly' correct estimate of the real value -of the earnings of these roads, because some of them' are ■incomplete. The paying qualities of the Western ' Cpuhties Koaa cannot be fairly judged 'when there, is a gap between An- napolis and Digby, and the Windsor and Annapolis Railway for a long while Was losing money, partly because they seemed to be purposely puttiftg their • rates at such a • figure as would compel' the Dominion GovernD^ient to give them back the Windsor Branch, ^he road is now worked under a more beneficial system, but there is still a loss in conse- 84 quence of the want of unity of management. The Province has no means, whatever, of obtaining returns upon the Intercolonial. In fact, it does not keep separate acconntH of its various sections. The earnings are distributed over the whole length of the road, and the (Government are unable to obtain anything but an approximate value of the Nova Scotia setitions, such as the Pictou Branch and the line between Truro and Halifax. The Halifax and Cape Breton Company have only recently completed their line, and therefore it is not i)ossible to make an exactly correct estimate of the probable trade over that rowi. Under these circumstances, the Province was not in a {)ositiou to obtain such an exact account of the receipts of these roads as would enable them to furnish any parties with whom they attempted to deal with reliable in- formation on this point. Nor, did they deem it advisable to do so, because on the one hand, if they had estimated the returns at too high a figure the Company might afterwards reproach them with presenting an inflated Atatement, and on the other hand if they had named too low a figure, they would prejudice their chanoes of making a favorable bar- gain. Therefore in negotiations between the Government and the Com- pany there was no estimate made of the probable value of those roads, ijut the Companies were left to ascertain and detei-mine for themselves, imd take upon themselves the responsibility of judging whether they were worthy of being acquired or not. Notwithstanding this, however, the Government did, for its own satisfaction take the precaution of ask- ing some gentlemen in whom they had confidence to go over the lines and estimate as nearly as possible their paying qualities. The first esti- mate was made with a view of ascertaining the value of the Pictou Brancn and Eastern Extension. The Government then asked Mr. Lynskey who is well knovrn in this Province as having managed the Western Counties Railway while it was in possession of the Windsor Branch, and whose management I think gave great satisfaction to the Company as well as to the country. We asked him for an estimate as near as he could make it, and he did so as well as was possible with the unclassified returns of the Intercolonial Railway at Moncton. His re- port bears date November 20th, 1879, and contains the following Uiformation : — *' Owing to the short time and want of figures giving details of the business of the Pictou Baanch, I can only give you a probable estimate of whBt it will earn for the current year, say ten months, ending 31st October. The coal from the different mines 172,000 tons; freight of other kinds, 19,94i2 tons; and passengers carried, 88,649. I think I am quite safe in adding 28,000 tons for November and December, and 6,000 tons of other freight. 11,000 paseengers, which is below the average. I have divided the traffic as follows : londondeny Works, 60,000 tons... iv.^i,'.vi*'.' J..4. ..;•..... I 18,000 Pictou Harbor, 60,000 tons ^..i,:'....'.4 .h...i>u.v!^..*.. fi,100 Halifax and other pointe, 12.000 tons ..., .).,.•• •••••• (O»4Q0 Freight of other kinds, 26,000 tons ,.,.. 40,000 Passengers, 100,000 , .^..,, 80,000 Kails and EKpreaa ...« .^.i ;«.i ,'iti ••.••'«•'• cU *■•> •••'•«'• >«,•*.•• 0,600 , , ■«! ..-.:: • $200,000 Working Expenses .i... .'.; .,. 1^0,000 Net Earnings .....4. t....... ....•$ SOLOOO Jr .ifTMi; '• ;i'i">it'»(t'>'? 'vn'ni t; •imkiii i' >hi 96 Mr. Ljnskey also stated in his Repoi-t that if running powers to Halifax cmild be secured they would add $10,000 to the net earnings of the road. With reference to the Halifax and Caps Breton Railway Mr. Lynikey says in his report " I have no hesitation in saying that before five years the Pictou Branch and the new lino, Eastern Exten- sion, would pay $100,000 in profits per annum. If well equippod ane whatever of noeiitg thorn completed. We have now placed before you a measnre by which we not only secure the completion of these Kailwayii but the aHdurance and security that they shall for all time to qoine \)e satisfactorily aiul efficiently worked, and we have ob- tained in addition to that the construction of a large extent of new Rail- ways, which if we were to devt>to to thorn the largo Hubsidios that were paid to the Railways before 1878 would cost an additional sum of at least $2,800,000, and we get them confiti-ucted without their costing the Province oi' Nova Bcotia one dollar. These are the benefits that we derive from the Contract in respect to our railways. But not only this. When a powerful Company like that with which we are negotiating organizes a system of railways in the Province of Nova Scotia they are not going to stop there. They have taken y)ower to construct certain other lines in this Province and they have not taken that power without moaning something by it. I have no doubt that as soon as they have completed the system in such a way as to justify them in commencing new undertakings, they will do so, and extend their railways to other parts of the Province which have not yet received any of the l)enefit8 to which they are entitled as well as those who enjoy them. I know that there may be a diversity of opinion on this point, and some counties that have not received any direct benefit from railways may feel that they are not provided for in this measure. But I do not think that they should take the position that, because we do not build railways to every creek and corner of Nova Scotia, they should oppose a measure that i8 fo complete the system now existing in an unfinished condition over the of the country. That would be a suicidal policy for those Be< is to pursue, because if the measure were to be defeated it would throw the Province back in respect to its rail- way enterprises into tlie unfortunate position in which it was situated three years ago when we assumed the administration and when there was no more apparent prospect of its ever reaching the happy condition in which it was now found, than there was of flying to the moon. If this present happy conjunction of circumstances is not taken advantage of at the present time the opportunity will not come again for many a long yoai'. The proposed arrangement also improves our financial condition. It returns to us $1,350,000 of the money we have expended. This is a vast improvement of our ilnancial condition, and it arises by reason of this railway measure, and by this alone. It brings back into the Treasury at one sweep the money which had been abstracted from it and squandered in the most improper manner, tnd restores the country to the financial condition in which it stood before that disastrous system was adopted of dealing out the pnblic money without regard to security by which the Province was brought to the very verge of bankruptcy. The Legislature can congratulate itself that by reason of a favourable concurrence of circumstances they have been able to lift the Province out of the mud both as to its railways and as to its financial condition. When we contrast the condition of the Province to-day in this matter with what it was three years ago we have reason to congratulate our- selves that we have escaped great dangers and steered the ship of state into calm water and prosperous courses, and have done, to the best of our ability, our duty to the Province of Nova Scotia. We will now be enabled, should this measure not be defeated, to oflfer to the people of ss the diflferent counties inoreaBed road grants. The very first step that we had to take when we assumed the administration of affairs was to cut down the road grant to one half of its former proportions, and we used to he reviled in the Opposition press becaase we were obliged to cut down the road grant in consequence of the extravagance of the Administration they had supported. Their AdminiBtration had spent the money and wasted it upon useless and frivolous objects, and having thus wasted t/ie money they had the untrtanliness to charge us with not being able to ^ve the same grants that they were accustom*d to give before the m jney was taken from the Treasury. Again, will not some benefit result to the Province from the expenditure of this new money that is to be brought into the country by the capitalists of London 1 They purpose to expend $4,000,000. Will not that be of some benefit to the people of this Province ? Yet if this measure be defeated, we lose all that, and leave the railroads and finances of the country and eveiything else in the miserably unfortunate state in which we found them, and the members of this House will be rejecting, as it were, all the funds which the Government's administration aided by their scheme, has been instrumental in securing. I have, Mr. Speaker, endeavored to discuss this subject in a fair and candid manner. If I have made any mistakes they ha^'3 been uninten- tional and not designed to mislead the House. I am well aware that there *re a number of points which in dealing with so large a subject I have necessarily omitted to refer to, and that my presentation of the question has not been in all respects as clear and explicit as I had desired to make it. I believe that if in any respect I have^ erred, it has been in not presenting the question as favorably as its merits de- manded. T now beg to thank the members of this House, one and all. for the assistance they have heretofore given the Government in sus- taining them in their endeavors to retrieve the foitune of the Province. I say this not with the desire of courting their support in this matter, but because I felt it is due to them to say that, as a general rule, the Opposition in this House give a hearty and cordial support to every measure which the Government introduce, which thev believe to be for the benefit of the Province, and for that I thank them. With regard to this measure, if it is their sincere convictior that it will be disastrous to the country, let them vote against it. I do noo anticipate such a result, because I think it must present itself to them in such a manner as to enable them to feel that in stipporting such a measure they are only pursuing the course, which as a general thing they have adopted from the time of the first meeting of the House in 1879 to the present hour, in strengthening the hands of the Government in their endeavor to re- trieve the financial condition of the Province. (Cheers. ) step that 8 was to , and we bilged to je of the I ad spent d having with not I to give not some iw money London 1 le benefit 3ated, we ntry and we found were, all ir scheme, i fair and I uninten- ware that subject I on jf the as I had . erred, it merits de- le and all, )nt in sus- Province. lis matter, rule, the i to every B to be for ith regard disastrous h a result, mer as to ' are only ipted from sent hour, Bivor to re-