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Tous les autres exemplaires originaux sont filmAs en commenqant par la premiere page qui comporte une empreinte d'impression ou d'illustration et en terminant par la derniire page qui comporte une telle empreinte. Un des symboles suivants apparaTtra sur la dernidre image de cheque microfiche, selon le cas: le symbols — ^ signifie "A SUIVRE ", le symbols V signifie "FIN ". Les cartes, planches, tableaux, etc., peuvent Atre filmte A des taux de reduction diff6rents. Lorsque le document est trop grand pour Atre reproduit en un seul cliche, il est fiimd d partir de Tangle supArieur gauche, de gauche A droite. et de heut en bas. en prenant le nombre d'images nAcessaire. Les diagrammes suivants illustrent la m6thode. 1 2 3 1 2 3 4 5 6 '.■-SB >»... BUDGET SPEECH DKLIVEUED BY HON. JOSEPH SHEHYN TREASURER OF THE PROVINCE, IN THE LEGISLATIVE ASSEMBLY OF QUEBEC, ON THB 15th FEBRUARY, 1889. QUEBEC 1889. *.A<4^.tt^^; -4^- '' ] 536 7/4 BUDGET SPEECH DEUVEEED BT HON. JOSEPH SHEHYN TliEASURER OF THE PROVIXCE, IN THE LGGISLATIVR ASSEMBLY OF QUEBEC. ON" fllE 15th FEBRUARY, 1889. '. • • • • , • • • . • ■ t • QUEBEC. 1889. or-f ....... ■ lie. 11^ B^ mi 6-. BUDGET SPEECH DELIVERED BY HONORABLE JOSEPH SHEHYN, TliEASURER OF THE PROVINCE, IN THE LEGISLATIVE ASSEMBLY OP QUEBEC, ON THE 15th FEBRUARY, 1889. The Speaker reported a message from the Lieutenant Governor, transmitting the Estimates. Hon. Mr. SHEHYN, Provincial Treasurer, then rose amid applause and said : — Mr. Speakek. — Before proposing the usual motion that the House do resolve itself into Committee of Supply, it is my duty to submit as full and clear a state- ment as possible of the financial affairs of the Province. It is only a few months since I had the honor of addressing this House on a similar subject and of laying before you, Mr. Speaker, a statement which embraced all the details that could have been desired. under the circumstances. I propose, on the present occasion, to be not less explicit and to give such ex- planations as will, I trust, be found satisfactory and tend to show that we have not been neglectful of the interests committed to our control. Before submitting the budget for the next fiscal year and asking for the necessary appropriations, it devolves upon me to prove that we have faithfully accomplished all that could be reasonably expected and that our promises have not been illusory. Fully realizing the importance of the task I have undertaken, I will do my best not to disappoint hou. members of this House, who look to me to furnish such facts and figures as will satisfy them that we have thoroughly understood the responsibility of our stewardship. But let US see if theso assertions are boroe out by real and tangible facte : 155197 4 » To render the statement I am about to make more easily understood, 1 shall indicate at once tne order I intend to follow : 1. Kemarks on the fiscal year 1887-88 ; 2. Assets and liabilitK^a of the Province on 30th June, 1888 ; 3. Fiscal year 1888-89 ; 4. Conversion of the consolidated del)t ; 5. Taxes on commercial corporations ; 6. Settlement of tlie accounts of the Province with the Domiuiou ; 7. Arbitration on the common school fund ; 8. Receipts and appropriations for 1889-90 ; 9. General remarks on the financial situation. I shall now endeavor to give tlie House all the information jtossiblc on each of these heads. The real operations, as detailed in the public accounts, arc as follows :— lieceiph of the Fiscal Year 1887-88. Dominion of Canada S1,2G1,872 81 I'rovince of Ontario, on account of interest on common school fund 100,000 00 Crown lands 72o,G27 50 ' Administration of justice 252,204 23 Percentage on the fees of public ofticers 8,815 17 Licenses 360,199 26 Legislation 418 56 Asylums — contributions from municipalities and patients... 50,318 62 Official Gazette 17,605 34 Public buildings 1,853 25 Casual revenue , 1,063 01 Contributions to civil service pension fund 5,468 24 Contributions to expenses of inspecting insurance com- panies 705 61 Industrial schools.. 38 00 Taxes on commercial corporations 558,393 00 Interest on deposits in banks and on loans .t 15,046 27 Premium, discount and exchange 424 46 Interest on the price of sale of the Q. M. 0. & 0. Railway.. 371,873 66 Traffic anears— Q. M. 0. & 0. Railway 3,066 84 Kefunda 2,634 66 Total of ordinary receipts „... $3,738,228 39 39 Trust fuiula — viz : teachers* pension fund $17,I{22 81 Security deposits by public oHicors 6,800 00 Security deposits for construction of iron bridges 3,856 ( City of Hull sinking fund 1,200 00 Marriage license fund 7,410 00 "La Caixadienne" Insurance Co. deposit 5,000 00 .ll,r,58 81 Municipal loan fund 4,891 23 I^duc farm, on account of sale 4,000 00 Quebec fire loan 540 00 Kepayments of advances 9,000 00 Refunds on account of construction— Q. M. 0. & 0. R'y.... 62,495 18 Temporary loan 400,000 00 Proceeds of loan of 1888, including $822.50 premium on N.Y. drafts 3,378,332 50 Total receipts from all sources ^7,639,076 11 Payments of the Fiscal Year 1887-88. Public debt $1,103,710 94 Legislation 228,994 88 Civil government 208,677 61 Administration of justice, including police 457,845 10 Ecformatories and indu.strial schools 88,708 13 Inspection of public offices 7,592 84 Public instruction 354,219 80 Literary and scientific institutions 1 1 ,739 78 Arts and manufactures 9,500 00 Agriculture 97,700 00 Immigration 7,300 00 Colonization roads and societies 87,500 00 Public works and buildings, imputable to revenue 145,096 91 Lunatic asylums 241,000 00 Benevolent institutions 39,316 00 Miscellaneous 31,419 75 Agent in France 2,500 00 Royal Commission on lunatic asylums 10,000 00 Supplying municipalities with Municipal Codes 5,000 00 Help to sufferers by Hull fire 5,000 00 Crown Landa Department 128,750 00 I 6 Muiiicipalitios' fuml 3,648 00 Official Gazette 13,644 33 Charges on revenue, Htamps, licenses, &c 11,469 12 Tensions paid 15,033 12 Q. M. O, it 0. Railway: trattic expenses, claims 8,000 00 liuiMing and jury fund, amount paid by sherifts out of collections 14,683 89 Licenses : amount paid by revenue oflicers oHt of collec- tions 26,982 16 Total ordinary expenses $3,365,032 36 Trust funds, viz. : — Marriage licenses distributed by Protestant Council of Public Instruction 36,984 00 Security by public oHicers 1,918 83 8,902 83 New Parliament Buildings, construction 8250,000 00 New court house, Quebec, construction 210,000 00 McGill normal school, to enlarge 2,500 00 Arthabaska court house and gaol, now foundations ... 6,000 00 Montreal court house, extension 21,422 83 Court houses and gaols, new districts, heating apparatus 6,000 00 Circuit court house and registry office, Kamou- raska 6,000 00 Iron bridges in municipalities 25,000 00 Protestant asylum for the insane (to bo recouped from proceeds of lieduc farm) 1 0,000 00 Insurance on Parliament Buildings, paid with transfer of property 32,765 00 Codification of the laws 45,000 00 Explorations in Dorchester, Levis and other counties. 10,000 00 Crown Lands Department, to meet oW engagements.. 55,844 93 680,532 76 Subsidies to railway companies $648,275 30 Q. M. 0. & 0. Railway, construction 14,000 00 662,275 30 Repayment of temporary loans 1,500,000 00 Total amouBt of payments $6,216,743 25 7 Slatement of <'ot>h. To Cttsh on hand on IJOth Juno, 1887 81,7r»l 60 AiUl tomporary loans 400,000 00 " aiuouut of consolidatud loan r),378,332 50 " trust funds 41,588 81 " warrants outstanding on 30th June, 1888 460,518 82 84,362,191 79 Less temporary loans repaid $1,500,000 00 " Excess of payments over receipts for 1888, repaid from loan 855,920 62 " Trust funds 8,902 83 " Insurance on old Parliament Buildings ',765 00 " Warrants issued in 1887, but paid in 1888 2 10,753 27 .«2,038,341 ":?. To cash on hand on 30th June, 18SS ?],723,850 07 I Kem:irk4on Ihe Fiscul Ye.ir lbS7-S8. The public accounts for the fiscal year ended on tlie 30th Juiv last, now in the hands of hon. members, together with the stattMiients I have just read, obviate the necessity of entering into many lengthy and tiresome details, Still, while broadly sketching the general outcome of the year's opei-atious, it may be desirable, as I proceed, to oft'er some comments or explanations, and I trust tliit the House will kindly bear with these, as my object is to make everything perfectly clear. I have already experienced its generous indulgunce in this respect, but as I am well aware that there are many to whom financial statements and arrays of figures are always dry and uninteresting and as I do not wish to tax their patience too much, I shall anticipate a lictle and come at once to the more vital point upon which all desire information. I have the pleasure to announce — and the House and country will, no doubt, be equally pleased to hear — that the ojxirations of the past fiscal year have been crowned with a result, which is all the more gratifying and welcome that it is unprecedented in the financial history of the Province for many years. We have to thankfully acknowledge A .SURPLUS of upwards of S373,000 in the ordinary '.ceipts over the ordinary ex2)enditure of the year. But it is not sufficient to announce this pleasant fact : I must prove it, and in proper time and place in the course of my remarks I shall endeavor by facts and figures to do so. mm 8 Total Receipts and Payments. As iudicated by the public accounts, the total receipts and payments of the year were: Total receipts, including trust funds, temporary loans and consolidated loan.... $7,639,076 11 Total payments, including the same items as above 6,216,743 25 Surplus of total receipts over payments $1,422,332 86 Add to this sur])lus the cash on hand on 30th June, 18b7... 81,751 66 And take into account the warrants issued in 1888 and still outstanding on 30th June last, viz $460,518 82 Less warrants of the previous year paid out during the year ^. 240,753 27 219,765 55 And the balance of $1,723,850 07 will be found to coiTespond witli the cash on hand on 30th June, 1888, as shown in the puljlic accounts. This, of course, only indicates the total results, but does not show the position exactly. To do this :iud ascertain the true difference between the actual receipts and tlie total ordinary and extraoixlinary expenditure, certain sums must be struck out. For instance, as I have Just shown, the total payments for the year Mere $6,216,743 25 But from thi.s must be deducted the following : Trusifunds $ 8,902 83 Temporary loans repaid 1,500,000 00 Insurance on old Parliament House 32,765 00 1,541,767 83 Leavingthe real total expenditure $4,075,075 42 On the other hand, the total receipts were $7,039,076 H Less trust funds $ 41,588 81 Temporary loaus 400,000 00 Consolidatod loan of 1888 3,378,332 50 3,819,921 3i 3.819,154 80 Making the excess of special or extraordinary payments over receipts $865,920 62 the 25 42 80 62 Bemark, however, that this sum of $855,920.62 is not a real and unfore- seen but )nly an apparent increase of expenditure, as it was provided for in our last loan and forms parts of the liabilities incurred by our preilecessors when in office and to pay off which that loan was contracted. It is also apparently leas than ths estimate in my last budget, but we have virtually paid out a larger amount, the differeucs being cover.>tl by the excess of our ordinary receipts over ordinary payments, as will Jje shown hereafter when treatingof tho. cunvnt r.'C-'ipts and expenditure. Extraordiwii-y ExpemUtiire. The total amount paid out fur extraordinary' expenditure, as i>cr public ac- counts, was : For sundries — (page 13, public accounts) $ 680,532 76 Subsidies to railways, &c 662,275 30 Total extraordinary expenditoie $1,342,808 06 Less insurance on Parliament Buildings 32,765 00 8 1,310,043 06 We may also deduct the following : — Surplus over Hl^otdinary expenditure .$373,190 03 Sundry extraordinary receipts 18,431 23 " 62,495 18 ^54,122 44 (See public accounts, page 12.) Net amount to ba covered by last loan S 855,920 62 The above figures will, I am sure, l«e found explicit enough as to the amount chargeable to capitjil and ought surely t j prevent our opponents from again falling into the error, into which, willingly or unwillinj^ly, they fell last year, of confounding ordinary ex|)enditure with «lu't was paid out of capital and which was to be covered by the new loan. Certainly, no unprejudiced mind at all versed in figures could ever have misconstmel mj' statement of last year as regards ordinary and extraorulinary expewliture. To my mind, no statement could have been clearer than the one I then made. Ordinary ReteHws and Expeitditurc. Now let us turn to the ordinary receipts and payments of the year. The ordinary operations of the year were as follows : Ordinary receipts proper - $3,738,228 39 Ordinary expenditure 3,365,062 36 Surplus over ordinary exfieiiditurc $ 373,196 03 10 As already remarked, this surplus of S373,196 over the ordinary expenditure must be a source of satisfaction to the House, especially when it is considered that only in 1887 the ordinary expenses overran the ordinary receipts to the extent o^" §324,251.10 and that sinc3 1875 we had accumulated deficits year after year until their a<,'gragatc exceeded §3,300,000. Thj present contrast with this undesirable state of things is so marked that I need not further dilate on it. However, I may add that the improvement would have been still more striking and that the surplus just shown of §373,190 would have exceeded half a million of dollars, had the interest service on our debt remained the same as it was before our advent to power. This . statement may seem somewhat paradoxical, but it should not be forgotten that tlie increase in our interest account is the result of the last provincial loan eflected for the purpose of paying oft" a Hoating debt, for the creation of which we w^ere in no way responsible. When we came to office —as I have already had occasion to explain in my fomier budget speeches — we found that we had on our hands as a legacy from our predecessors a floating debt of about $4,000,000 of undis- puted liabilities, a portion of which had to be met immediately and the balance at an early date. This floating debt, as you all know, con.^isted of temporary loans, railway subsidies and claims for the construction of our public buildings. We had in addition unsettled and disputed claims to the extent of $4,500,000. Some- thing had absolutely to be done to extricate the province from this situation and to maintain its credit at thli requisite standard. t)ur ordinary revenue was inadequate to nu^et our ordinary expenditure and, under then existing circum- stances, it was hopeless to look for relief in that quarter. Consequently, a loan was unavoidal^le and, with the proceeds of that loian, the bulk of the undisputed floating debt has been since paid off, as well as certain of the disputed claims, which were pronounced legitimately due by judgments of the law courts or admitted, a^'ter a proper and diligent enquiry into each case, in preference to fol- lowing a litigious course, which would have been sure to saddle the Province witli costs or exposed it to the risk of advtn-se decisions forcing it to pay heavier amounts. Therefore, as far as the incrtase of our interest aci.o'mt is concerned, we are in no wise responsible, as it merely represents the capital we h.^d unavoid- ably to borrow to meet tliese obligations. In other words, if on the one hand we have reduced these obligations, we have on the other been naturally compelled to increase the interest service on our public debt. This increase represents a sum of §125,950.02 more than 1880 — the total amount paid for this service during the last fiscal year being §1,103,710.94 as compared with §977,700.12 in 1880. This explains the statement I made a moment ago that the surplus of §373,190 of ordinary receipts over ordinary expenditure would have exceeded hc^lf a million but for the unavoidable augmentation of our interest service. In my budget speech of 1887, I estimated the ordinary receipts as likely to 11 produce the sum of 83,020,522.80, while the amount actually realized has hceu 83,738,228.39, which is 8717,705.69 more tlian I estimated. I also estimated the total receipts from all sources at 83,216,022.80, while they have readied the sum of 83,819,154.80 or 8603,132 more than my estimate. It is true that in the 83,738,228.39 of ordinary receipts is included some 8558,393 realized from arrears of taxes on commercial corporations, wliich were not covered l»y my estimate ; but, even striking oil this amount from the ordinary receipts, they would still show the sum of 83,179,835.39 or 8159,312.59 more than estimated. I find that from 1883 to 1887, which were the best years of our predecessorsi the average annual ordinary receipts were 82,884,109. Xow, if yfiu compare this with the result of the last fiscal year in the same respect, the latter shows an excess of 8295,720 over the average returns in any of the years extending from 1883 to 1887, and if you add to this excess the 8558,393, proceeds of the arrears of taxes on commercial corporations, you get a sum of 8854,110 more than in any year during the same period. Of course, to realize tliis excess of actual receipts over our estimates, some items must have produced more than we counted upon ; at the same time others, which nvc fortunately of minor importance, have produced less than the estimates. We have receivtul in interest oti collections made by Ontario from the common school fund 8100,000 instead of 860,000. The administration of justice has yielded some 821,000 more ; licenses, 853,217 net beyond the estimates, and Crown lands 868,000.00 over the amount calculated. But, if the ordinary receipts have exceeded our calculations, so also has the ordinary expenditure exceeded the original estimates, which were based upon the average of 1886. However, we soon found that they were inadequate to the exigencies of the puldic service and insufficient to meet all the obligation.') previously contracted, besides leaving no provision for the settlement of a nmnbor of old claims, which had been left in suspense and M'hich had to be met, when it was established that they were legitimately due. During last .session, when ?ubmittingmy supplementary esti males iov the last fiscal year, the existence and nature of several of these liabilities were fully discussed and explained to the House. The avernge annual ordinary expenditure from 1883 to 1887 inclusively has been 83.095.939. During the last fiscal year it reached the figure of 83,365,03 J.36. But the difference in excess is easily accounted for, as, in the matter of interest alone on our public debt, we have had to pay 8213,961.94 more than was paid in 1883, and 8125,950.62 more than in 1886, so that, virtually speaking, outside of the increased interest paid out on our debt, which was both unavoidable and uncontrollable, the ordiniry ex|.eiuliti"re for the last fiscal yo:ir has remained about the same in all iti other it3ms as in 1883, 1884 and 1887. 12 The House will bear in view that we are not responsible, as already explain- ed, for any additional interest on our public debt, which has gradually been increased by the liabilities previously contracted and for the extinction of which our last consolidated loan of 83,500,000 was effected, and it must also be remembered that the amount of that loan was not sufficient to cover the floating debt as established at the time we obtained the necessary legislative power to negotiate the loan. An examination of the following figures taken from the public accounts will show at a glance the gradual increase in the interest on our public debt and the net ordinary annual expenditure during the period extending from 1883 to 1887 -. 1883— Total ordinary expenrliture S3,090,981 00 Less interest 889,794 00 Net ordinary expenditure S 2,201,187 00 1884— Total ordinary expenditure S3, 088,07 5 00 Lfcss interest 964,192 00 Net ordinary expenditure 8 2,123,883 00 1885— Total ordinary expenditure $2,931,443 00 Less interest 980,110 00 Net ordinary expenditure $ 1,951, 333. 00 1886— Total ordinary expenditure 83,023,283 00 Lessintercst 977,760 00 Net ordinary expenditure 8 2,04G,523 00 1887— Total ordinary expenditure 83,286,232 00 Less interest 1,016,022 00 Net ordinary expenditure 8 2,270,210 00 1887-88— Total ordinary expenditure 83,363,032 00 Lessintercst 1,103,710 00 Net ordinary expenditure 8 2,259,322 00 These figures show that, except in 1885 and 1886, the average controllable annual expenditure was about the same as that of the last fiscal year, and, as for the years 1885 and 1886, it is well to bear in mind that those years were the years which immediately preceded the general elections. In view of that event and with the object of trying to conciliate the good graces of the electors, the then Goveniment thought it high time to take a new departure by parading a policy very different 13 from that which they had until tllen followed. They all at once begjin indis- criminately to cut down expenses in the different branches of the public service, to such a degree as to threaten their etticiency, in order to present an appearance of economy and to endeavor to reduce to a minimum the deficits which up to that time had figured in the public accounts. It is needless ii say that this was only an .apparent economy, for, when we came into power on the Slst January, 1887, on looking into the financial situation, we soou discovered that my prodijcessor had been exceeding his appropriations, while an estimate of the balanco of the re- ceipts likely to come in for the remainder of the year and of the expenditure to be provided agiinst for tho same period showed that his appropriations \\:-v.\ quite insufficient, and the result was that we were compelled to apply to the House for additional supplies to meet the case. Our own experience, since we have been in office, has only tended to still further strengthen the conviction that the reductions of 1885 and 1886 Avere ap- parent and only attempted at the expense of the efficiency of the public service. Nothwithstanding our sincere and earnest efforts to curtail the current expcndituic during the past fiscal year, we have fouud it an impossibility to do so, owing to the increase of our interest service and to the necessity of meeting liabilities not incurred by us. But if we have not succeeded in bringing down the expcjuliture to the point that we would have wished, we have, on the other liand, succeeded in increasing our revenues and have brought them up to a standard which they have never reached before. I cannot, however, dismiss the question generally of the expenditure without reminding the House that it is becoming yearly more and more difficuh to keep down the current expenses, owing as well to the increase in the service for interest as to the fact that many items of the public service have to keep pace from year to year with the increase of the population. New demands are springing up all the time, and it is moreover almost impossible to check the general tendency of the country to call upon the Government of the province for a large measure of aitl to every enterprise, whatever may be its nature or utility. I must candidly admit that my experience, since I have been at the head of the Treasury Department, is that the universal feeling sooms to be tliat tlio fJovern- ment is bound to take the initiative in every undertaking, wliich either nearly or remotely wears the impress of a measure of public necessity, and that it is obliga- tory on our part to give it not only moral assistance, but in addition the amount of money required to carry it out, forgetting that the means at our disposal i\\\i only of a limited kind and out of all proportion to the constant demands made on the guardians of the public chest. Wliilst, on the one hand, every one seems to be anxious for public expenditure, on the other liand, no one seems to be inclined to contribute in any shape to the ways and means required to carry out the policy all 14 so cigerly encoungc. Ou the contrary, as a general rule, every possible infloencc is used, not only to esc^ipe doing so, l>ut to aAoid paying even the most Ite^tiinale claims of the f Jovernment. In fact, as already stated, the general tendency is un- fortunately to look up to the Government for aid and assistance in ever*- kind of undertaking, but to bitterly oppose any and every attempt that is made to inotease the public revenue. Extra Expenditure Justified. Xow, before passing to another head of ]ny discourse, it i.s my daly to j;ivc such explanntions to the House as will satisfy it that tlie extra expewlitoiie in certain items has been legitimately incurred and was in the general intereal of the province. I have already dealt with tlie increase in our interest service, so it is onneees- sary to here refer to it again. I will therefore pass on to the next item, which is one of $1 0,000^ fivtlM! royal commission on lunatic asylums. Tor this we are responsible ; but I am sure that no reasonable jiersou will object to the utility of this expendituie, in view of the urgent necessity which had arisen to satisfy public opinion !>y a full and complete enquiry into our system for the maintenance and treatment of the insane. 1 am convinced tliat every one who reads the rej)ort of this commission must feel satisfied that this emiuiry was absolutely needed and that the outlay incurred for the purpose is triHing, as compared with the importance of a suhjecl iu which the whole province and, indeed, the cause of humanity at large are inte- rested. "We next come to the increase of 811,000 caused by the additional nmnler of patients admitted to the l^lunatic asylums. This item of additional expienditnre could scarcely have l>een avoidcfl, unless we had acted contrary to the sjarit and * intent of the law, and I may .say that, with the increase of our population, the increase of this item is sure to go on, and its Inirthen will annually become heavier and heavier tipon the (Jovenuiient of the province, unless some means more suc- cessful than any that have been yet tried can be found to alleviate it. The following statement will at once show the rapid progressive incxcaae of this item of our public expenditure since Confederation : — In 18G8, the amount paid for the maintenance of the insane was.$ 97,946 53 In 1871 J25,458 00 " 1881 200,000 00 " 1888 241,000 00 The above figures need no comment. They speak sufficiently for themselveai Tlie Interprovincial Conference cost $10,094.23 for reports, stenognpheia^ translators, stationery and reception jf th.. delegates. As to the importiooe or utility of the work of this conference and the principles involved, I tla noi 15 inle- tlunk it is necessary to allude in au examination of the nature I am now making. Still, I must say that the very holding of such a conference in our midat cannot be otherwise than beneficial to our province from the fact alone that it had the effect of drawing all the provinces into a closer relationship than had previously existed. Altogether, I consider this ♦ xpenditure fully compensated by the im- mense results that will accrue to us from the holding of this Interprovincial Conference. The repairs to court houses and gaols cost $36,131.25, being $21,131.25 more than our estimate, which was only $15,000, and which turned out quite insufficient to meet the demands that were maile for works admitted to be indispensable by reports fyled in the Public Works Department, and recommended by the competent officer of the Department. Let me olkserve that for a long time little ot nothing had been done in the shape of repiirs and improvements to these buildings, so that most of them, I understand, would have considerably deteriorated, had they been allowed to continue as they were. It therefore became necessary, in order to keep them up to a proper standard and to avoid a larger expenditure hereafter, to spend a * certain amount upon tln-Mu In order to economize, as little as possible had been previously spent upon tliem; but, wlien we came to power, we found after a care- ful examination by qualifieil peTsoa>, .supported by official reports, tluit, howev(,'r unpleasant it was to exceed our estimate, it Avas nevertheless an absolute necessity to go into this expenditure ratlier than sdlow our public proi)erty to suffer further depreciation. Public buildings generally liave also exceeded our estimates by S43,877.5 \ This sum was expended in repairing the wall surrounding the old Parliament House, tlie wall of that portion of the Terrace known as the old Durham Terraci', which had become dangerous for the public, and on repairs to the McCJill Xormal School, which had become uidiealthy, and to the Legislative Building, the Public Departments, &.c. These various reittirs had necessarily to be el1'ecte<]; but, un- fortunately, no provision had been '.:'ade for them in the estimates. That a part of them were urgently needed and co.dd not be delayed without danger, there can be no question, and, had we not Ciiust-d them to be executed, we would have ex- posed ourselves not only r. adverse criticism, but, perhaps, to heavy damages, if any accident had occnnred through our neglect, especially in the case of the wall supporting the public promenade, known as the old Durham Terrace, which is in our charge. Adminisf ration of Justice. Under this head, there has been an expenditure of about $72,587.97 in excess of our estimates. This augmentation w-as due to tho expenses entailed by the in- creased number of prisoners ami condemnations, the holding of criminal terms in districts in which none had been held for some years previously, the settlement 16 and payment of outstanding claims, the increased costs consequent on the embezzle- ment of public moneys, the holding of special terms in Montreal, &c. This branch of the public service, seems to be gradually on the increase and calls every year for additional expenditure. 1 find that my predecessors in office had from year to year been pointing out to the House the impossibility of keejiing down this item and the necessity of seeking some alleviation of its steadily growing burthen. No doubt, as the population increases, this service will also be- come more and more expensive, and the House must be prepared for the inevitable in this respect, unless some eificacious means can be found to overcome the difficulty. In order to illustrate this subject, I believe I cannot do better than quote the very words of the houoralJe member for Sherbrooke in his budget speech for 1884. S.iid my honorable friend on that occasion : " 1 need hardly repeat what I have for the past ten years said to this House, ," that the expanse of cnminal justice should be paid by the Dominion Govern- " ment, inasmuch as it is for the enforcement of their laws ; and the fact that the " administration of criminal justice was given to the local authorities by the " Confederation Act by no means implies that it was to be at their expense, but" " as wo have had courts of justice established, and had the exclusive right to establish " such courts, that it w is m )re convenient for us to administer the criminal law " than for the Dominion authorities to do it. From some hints which fell fron " some members of the I'rivy Council in Ottawa I am in hopes we shall be " relieved from the burden, or compensation will be made to us, so as to assist in «' the administration of criminal law. If no assistance should be rendered by the " Dominion Government, it may hereafter become a question of necessity with us " whether we must not resort to the sam3 plan adopted by, I believe, all our " sister provinces, to place a larger share of the criminal justice upon the municipal " authorities than is now done, in order to relieve the provincial authorities from " bearing, I may say, the whole of such expense, as at present is the casj. In the " nnantim J, I hop3 that this will not be necessary." So thoroughly imbued was my honoral)le friend with tlie correctness and force of his views that, in 1885, he returned to the subject and, in his budget speech for that year, pointed out the evils arising from certain branches of the administration of justice, in the following terms : — " I shall not repeat what I have so often said as to the obligation of the " Dominion Government to assume the cost of the administration of criminal " justic '. " This matter was again brought before the Government in Ottawa in January " last, and it wms promised attention, particularly with reference to amending the " law so as to provide for a further extension of the speedy trial system before 17 the lial Ihe " police and district magistrates, by taking away the right of the accused to ask for " a jury trial for minor offences, thereby assuring the more speedy conviction of " offenders or their release, if innocent, as the case might be, and saving a largo " coat to the province, not only in trials for offences, but in keeping of prisoners " in jail awaiting their trial. " I am afraid, Mr. Speaker, that in many cases ofticers of our courts try to " induce prisoners for petty offences to ask for a jury trial instead of a trial before •' a police or district magistrate, so that it may bo necessary to summon grand and " petty jurors, in order that they may obtain fees in summoning the jurors and " witnesses, entailing large expenses on the Crown, in payment of Crown officers, " jurors, constables and witnesses. The relieving of a few of such officials from " further services under the Crown would produce a good effect. " Reformatory Prisons for Boys. — Montreal, Levis and Sherhrooke. " There was spent on these reformatories last year $54,500, and voted for '• this year S55,000, and asked for next year's operations 855,000. " I am at not at all satisfied with the operation of these institutions. Tlieio " are too many young boys sent there for trifling offences ; they derive little, if " any, good from their detention ; when liberated, not knowing anything about " farming pursuits, they go to the cities for employment and fall again into vice " and finally in many instances graduate in the penitentiaries. They ought to bo " brought up far more to agiicultural pursuits than they now are, not so many " kept together as there are in the city institutions, and, when liberated, the boys " would seek work in the country parts, and be far less likely to fall again into " crime. (Cheers.) Again, the price paid for the keep of tho boys is by far too " high and, when another contract is made, I hope this will be looked after." Such were my predecessor's views relative to the expenses of the adminis- tration of justice. The following figures will indicate at a glance the ratio of increase in the cost of the administration of justice since Confederation and the extent to which it is weighing on the budget of the province : — In 1868, we paid for this service $311,388.00 " 1878 " " " 484,777.00 " 1888 " " " 546,464.00 It is no wonder that my predecessor should have complained of the continual increase in the cost of this service — an increase which was equivalent to 50 per cent, in 1878 over 1868 and to a little over 12 J per cent, in 1888 over 1878. Ic must, however, be admitted that, since we have been in power, we have endeavored to settle all pending affairs, that this depcu-tment has been conducted 3 18 with vigor, and that, with the view of making the service as effective as possible, many important reforms have been introduced, which will contribute to make it more perfect and satisfactory as far as the public requirements are concerned ; but it is needless to say that this desirable rcsnlt could only be attained at the expense of increased cost. Some of the following items were unforeseen, and others were considered useful and necessary in the interests of the public service : Aid to sufferers by Hull fire — unforeseen 8 5,000.00 Election expenses in conse- fiuence of more elections being held than was expect- ed owing to the large number of contestations " Special roads, bridges and cul- verts in county of Beauce in connection with the settlers brought from the Labrador coast l)y our predecessors " Expenditure in connection with the codification of the statutes " Supplying municipalities with the Civil Code Agricultural Commission Increased sessional allowance — passed unanimously 5,000.00 3,000.00 6,741.00 5,000.00 3,000.00 17,800.00 Add together these various items, a part of which were acciileutal, and unfore seen, whilst others were indispensable, and you get a sum of .So40,182.57. Now if you take the total expenditure for 1888 $3,365,0^.30 And deduct from it these 340,182.57 The net sum left will be $3,024,859.79 Making the tot^al ordinary expenditure of 1888, after deduction of the items just enumerated, about the same as it was in 1886, when it amounted to $3,032,607.25. Now, I think that, as regards the ordinary receipts and expenditure of the last fiscal year, I have given all the explanations it is possible to give as to the items in which there has been an excess of expenditure and as to the causes which occasioned it, and I believe that the House will be fully satisfied that I have stated clearly what was uncontrollable, what unforeseen when making out the estimates, and what part was .specially employed for the improvement of the public service. 19 It will l)c — [ am sure — readily admitted that tlie policy we have pursued has hcon one of vigor and action. On the one liand, we have dune all it was possible to do to increase our sources of revenue, and, in this direction, our eflbrts — I am happy to say — have not been iiltogethor unsuccessful ; but, on the other hand, if we have gouo to some additional expense to attain this object, no one having the interest of the province at heart will find fault with us, es])ecially when our only object in doing so has been to place the public service in the best state of efliciency attainable under the circumstances in which we were placed and in the face of tlie innumerable dilhculties by which Ave were surrounded. However, we had the nerve and the courage to meet thorn manfully and to solve and settle them wlierever practicable. Our sole aim has been to restore the credit of the province to a sound Itasis and at the same time to carry out a policy, whose object was not only to secure an increased eflectivenoss in all the public depart- ments, but likewise to give all the wise encouragement possible to the develop- mout of the natural resources of the province. Collection of the Revenue. In connection with the work of increasing the ettieiency of the public service, let me instance en passant what has been done to improve the service of the col- lection of the revenue, although it has only been effected within the current year. Everyone acquainted with the working of our Treasury department is aware of the fact that a change in the direction of a better division of the labor had been long and urgently demanded, especially by the great development of the province since Confederation, the increase of population, the extension of the territory to be covered, and the constant augmentation of the number of new municipalities ere'cted, coupled with the increased importance of old services and the creation of new ones. It is only necessary to contrast the operations of the Treasury in 1808 and its present operations, to at once appreciate the immense increase referred to. Thus the ordinary receipts, whioh were only 81,529,043.20 in 1868, had swelled to $2,036,868.91 in 1875, and to $2,9(35,560.62 in 1887, or to about doultUi their figure in 1868 ; and the ordinary expenses, which only amounted to 81,104,260.22 in 1868 and to 82,019,410.91 in 1875, had increased to 83,386,232.70 in 1887, or to more than double their figure in 1MC8. Among the services which have largely added to the original work of the department may be mentioned the increase in the collection of license duties, the tax on commercial corporations, receipts aud payments in connection with the railway policy, the contributions of municipalities to the building and jury fund, the municipal loan fund, the maintenance of the insane, of vagrants in the common gaols, of children in the reformatories and industrial schools, &c. In fact, in nearly every branch of the department, the 20 work had so rapidly increased that the varions services could not be efficiently looked after and followed — the result being, that the revenue of the jjiovinco was suffering from the absence of that direct control and constant supervision, which are so essential to protect the Government from loss in its collection. Additional burdens and responsibilities were also being from year to year thrown on the shoulders of the Assistant Treasurer, ami, in oi"der to relieve tliis importinit oflicer lo such an extent that it might be possible for him to more freely and eflectually devote himself to the work of general supervision and to matters of finnnce proper, and release him from the details of revenue collections and the enormous corres- pondence necessitated by the development of affairs, we decided, after a careful and exhaustive study of the situation, to divide the labor. A special revenue bureau has accordingly been created within the department, to w^hich has been entrusted the administration of revenue collections under tlie care of an experienced and responsible officer styled the Comptroller of Provincial Eevenue. This officer has, under his control and supervision, the services above mentioned, or which may be hereafter added thereto, antl the collectors of provincial revenue in the twenty- six actual revenue districts of the province. As the principal object in view in creating this bureau is to assure a closer and more efficient following up of these services, in order to protect the public interests and increase the revenue, a special Inspector of Eevenue has been attached to the office of the Comptroller, whose duty it is to inspect at all times when deemed necessary, but at least once a year, the offices and books of the different collectors of provincial revenue, and to ascertain by personal enquiry and observation how those officers perform their duties and how the revenue laws are observed in the different districts. I may remark that these two appointments have Vieen made on the principle of promotion, without increasing the departmental staff except by one clerk, and that the two officers named have had a long experience of the working of the department and enjoy a well-earned reputation for zeal and ability. I think it needless to further justify these changes, as their absolute necessity must strike every one. Moreover, at Ottawa, it has long been found desirable to have entirely separate departments for finance proper and for the collection of internal revenue, and the time is long past when the same deputy head in the province of Quebec should be held responsible for everything pertaining to finance and (revenue. Hereafter, Mr. Machin Avill be free to devote all his energies to questions of finance proper, such as banking matters, loans and a host of kindred affairs that require the constant attention of a financier of ability and repute. I should not omit to mention also that, to meet the well understood wishes of the important city of Montreal, the force of revenue police there, charged with the protection of the license revenue and the interests of public morality, has been increased from three to six, and that of Quebec from one to two. I consider it 21 3sity lave brnal [e of |uue. [3 of Ithat b of nth pecn it unnecessary either to justify tlieso changes, as they Imve Iwen dictated Ity the necessities of the situation and their results cannot fail to bo bcnelicial, both financially and morally. Only a few months have elapsed since those chaujjos have been made and already wo have had occasion to congratulate ourselves on having made tiiem. The new Inspector has already visited several parts of the rovonuu districts and his reports on the administration of the different collectors, as well as on the working of the license laws in the municipalities, are of a nature to supply us with valuable information and to enable us to exercise a greater supt'rvisiou over everything connected with the collection of the revenue. Apart from the Dsefulness of the new Inspector, the business of the now branch, since the Comptroller has taken charge, has been promjjtly despatched and efficiently supervised. The changes made in the revenue police force at Quebec and Montreal had become, .udispensable and have been favorably received by all anxious for the maintenance of good order and morality, especially as regards tlie illicit liquor traffic and its resultant abuses, as, with a more ettective force, it will be easier to get rid of the unlicensed liquor dealers and to better enforce tlie law. Before effecting any reforms, should there be occasion for them, in the general account-keeping, it is essential to first thoroughly understand its actual working and to ascertain to what extent it is really suited to the requir neuts of the different services. This question is now being studied. Certain reforms are desirable, but they cannot be carried out until the whole system and its adaptability to the wants of the public service have been exhaustively examined and considered. Consequently, before thinking of serious reforms in that direction, it is absolutely necessary to thoroughly master the actual machineiy and ascertain its defects ; and it is only through much experience and study that a practical solution on this head can be arrived at. Special WaiTants and Sn,'ppleme'ntary Eatimatea. Before closing my remarks on the fiscal year ended on the 30th June, 1888, I think it not misplaced to say a few words on a subject which has been used as a text by our friends of the Opposition. In the hope of making political capital at our expense, our honorable friends of the Opposition have denounced us for having issued special warrants and demanded supplementary estimates. This is unfair, when all the circumstances are taken into account, when it is remembered that we had only just come into power, that, having nothing else to guide us, we had necessarily to base our estimates on the average of theirs of the S3S 22 previous fiscal year, 1886, and that, if our estimates turned out insufficient, tlie fact was in a large measure due to the liabilities which they left us and which had to he settled. The payments we have made are easily exjilained, and it therefore comes with a very poor gi-ace from our adversaries to find fault with us, as in doing so they only condemn their own policy, they themselves, to a much larger extent than wc have done, having frequently had recourse to special warrants and supple- mentary estimates to cover the glaring insufficiency of their appropriations. It is unnecessary to go back very far for proof of this assertion. In 1881-82, under the treasurership of Hon, Mr. Wurtele, special warrants were issued to the extent of §166,956.79 making, with the Si:.2,849.00 of supplementary estimates asked, a total of §319,705.79. In 1882-83, special warrants to the amount of $488,929.97 wore issued, to which must be added 844,472 of supplementary estimates for the same service, notwithstanding the fact that during these two years there was, in the ordinary operations, a deficit of 8208,858.22 in 1882, and of $341,236.06 in 1883. But a glance back at the past will immediately show that our predecessors liad regular recourse to special warrants to meet expenses that were ujiforcseeu but not extraordinary in their nature, for the most of these warrants were to cover the insufficiency of the appropriations for the dificrent ordinary and controllable branches of the public service. The following table will show that, before our entry into oflice, recourse was had regularly and largely to special warrants, whenever it was necessary' to supple- ment insutficient appropriations : — In 1872 special warrants were issued to the amount of. 8126,497.52 " 1873 '• " " " 151,054.43 "1874 " " « « 67,431.72 "1875 " •' « " 41.747.83 "1876 " " " •• 81,046.67 "1877 " " " " 86,343.02 " 1878 " " " " 130,049.66 "1879 •' " " ., " 205,857.97 "1880 " " " " 127,071.43 " 1881 " " " " 36,696.46 "1882 " « . «« « 166,956.79 "1883 " " " " 488,929.97 In 1885 and 1886, no special warrants., but supplementary estimates.. lu 1887 from 30th Juno, 1886, to 31st January 43,932.82 Apart from these special warrants, regular and invariable rceoui-se was hail to supplementary estimates, Mhich proves the impossibility of foreseeing every- thing. Consequently our friends on the other side should have iio rcason to 23 appear so astonished at the fact that we issued special warrants to meet expenses which could not be foreseen, when they themselves resorted so constantly to the same method. I beg my honorable friends of the Opposition to believe that I do not recall these facts as much with the view of blaming them, as to show that the issuing of special warrants during the fiscal year in question, when we had no opportunity of knowing or ascertaining exactly what were the actual requirements of the public service, was excusable enough, consiiJering that our predecessors, with all their past experience, could not avoid doing so during almost every year that they had charge of the finances. Biit there is an important difference in our favor : if wc issued special warrants, we found means to pay them without having a deficit. n. Assets and laabilities on 30tli June, 1888. Allow m3 now to give the H^ase aa appro ximit3 statomctit of the assets and liabilities of the provinca as they sViol at the end of the last fiscal year : — Approxim.vte Statement cf the -A-^s-^tsand Liabilities of the Province of Quebec, on the 3Uth June, 1833, b-»s^l on the ofliciaj reports of the different departments, but not inclaling a large amount of contested claims against the Government, or the amount due to Uie province from the municipal loan fund : — Luibilities. Funded debt outstanding S21,570,333 33 L932.82 as had every- leon to Temporary deposits Outstanding warrants Railway money subsidies atthomed, but not yet earned Railway land subsidies, iwuverte«l into money subsidies, authorized, but not yet earne«i, haLtnce on the first 35 cts. per acre Railway land subsidies wluch may be converted into money subsidies, 898,000 acres at 70 cts. peracre 8 628,000 00 Firat 35 cts. per acre jmyable as the work is done Estimated cost of completing Parliam^r^t Build- ings 229,026 23 460,518 82 425,724 85 012,828 80 314,300 00 125,729 53 24 Contract for statues on Parliament Buildings.... Estimated amount required to complete Quebec Court House.... Balance of land and other debts Q. M. O. & 0. Railway , , Loss on Exchange Bank deposit Quebec Court House bonds 25,000 00 100,000 00 90,000 00 27,000 00 200,000 00 $24,180,461 5G Asaeia. Part of price of Q. M. 0. & 0. Railway deposited in banks $ 385,000 00 Part of price of Q. M. 0. & 0. Railway invested in Quebec Court House bonds 200,000 00 Part of price, do, invested in city of Quebec debentures 15,000 00 Balance of price of Q. M. 0. & O. Railway unpaid % 7,000,000 00 $ 7,600,000 00 Capitalized railway subsidies under Dominion Act, 47 Vic, chap. 8 $ 2,394,000 00 Claim against Hon. Thomas McGreevy 100,000 00 Cash in banks 1,723,850 07 Cost of Jacques Cartier School, Montreal, to be repaid from sale of property 138,348 02 Advances to various parties 78,771 40 Estimated amount due as interest on Common School Fund from Ontario .-. 50,000 00 Quebec Court House tax under 45 Vic, chap. 26, and 48 Vic, chap. 15 200,000 00 812,284,969 49 Excess of liabilities over assets on aOth June, 1888 11,895,492 07 $24,180,461 56 This statement does not differ materially from that presented last session. It is true that tbs total amount looks larger, but in reality it is only Very slightly so. 26 J48 02 m 40 )00 00 )00 00 )69 49 ^92 07 L61 56 It Itly so. The funded debt, which amounted on 30th June, 1887, to $18,117,233, is now $21,570,333.33--our last loan of $3,500,000 having since been added to it. On the debit side of the account, wo have still outstanding a part of the obligations for which the loan was contracted, whereas, on the credit side, we have as cash on hand the sum of $1,723,850.07 which represents the unexpended portion of the loan. Therefore, if, on the one hand, the liabilities are larger, on th3 other, the assets also show an increase from $10,859,009.10 on the 30th Juua, 1887, to $12,284. 947.19 on the 30th June, 1888, this increase boiug produced by the residue of the loan still on hand. The excess of liabilities over assets shows a slight increase, the items of which were fully discussed last session. It is, however, easy to account for this increase in our liabilities, as the full amount of the last loan is charged, while the cash is only credited with the amount realized, viz, $3,378,332.50, which makes a difference of $121,667.50, representing the loss between 96J at which our bonds were sold and their face value. The House will recall that the floating debt, as valued in my last budget speech, amounted to $3,761,466.75 net, so that the net proceeds as above stated of our loan to cover it fell short of doing so to the extent of 8385,134.25. Now add to this sum the $121,667.50, loss incurred on the sale of the bonds, and a sum of $504,801.75 is reached, which accounts for the additional amount of liabilities over assets. The surplus in ordinary receipts over ordinary expenditure, viz. $373,1§3.03, has gone generally towards the payment of the construction account of the Parliament Buildings, Quebec Court House and other items ; tlie amount pu( down on 31st January, 1887, as being required to finish those buildings, having been found insufttcient. It is now clear that the amount of floating debt and disputed claims was underrated and that thay should have figured for a larger sum than was furnished us when making out, on the 31st January, 1887, the statement of our liabilities. The real amount, as far as visible and as far as can be accounted for, will be sure to reach $4,000,000 to $4,500,000, leaving out of the question all disputed claims that are still pending and may be decided against us. It must therefore appear evident to all that our loan, which netted only $3,378,332.50, was insufficient to cover the total amount of our floating debt and that it should have been somewhat larger. However, at the time we made our statement, it was difficult, if not impossible, to foresee that certain items of the disputed claims would go against us, although, it will bo remembered, that we then statsd very distinctly that there seemed to be a certain amount of these claims which wo\ild inevitably have to lie paid. 26 Out of the proceeds of the loan, we paid during the past fiscal year all we owed in the shape of temporary loans, so that all that now remains under the head of temporary deposits consists of trust funds. The amount of outstanding warrants is larger than usual, but this is entirely due ^o the fact that our last session was still going on at the expiration of the last fiscal year and that we could not close our books at that date, as the supplementary estimates intended to complete that year's service were not voted till the 12th July, so that, although the warrants had been issued, the cheques were still outstanding at that date. This, however, in no wise affected the total public expenditure for that fiscal year, as all these payments are regularly entered and charged among the expenses of that year. When these cheques come in, it will, of course, affect our cash balance to that extent — that is all ; hence the object of placing the amount on the liability side, whilst the assets include the full amoii.it of the cash on hand on 30th June. As regards subsidies to railways, these are gradually being paid off and all that figures under that head will be ultimately and inevitably claimed. There can be no doubt as to the balance of the railway money subsidies and the railway convbrted land subsidies — these are yure to be earned by the different companies thereto entitled ; while as to the companies, which have a right to a land subsidy, but which have not yet apphed for conversion, there is little doubt, according Mr. Moreau's report, that they will do so in due course. The items for the completion of the Quebec Court House and Parliament Buildirgs call for no particular comment, as they were partly voted last* session and the remainder will bj duly explained in our estimates. I may say, however, that in the amount estimated for the completion of the Parliament Buildings are included some $48,000 already voted and intended to purchase property, including the Skating Rink, etc., but which had not Ijeen expended for the purpose on the 30th June last. In the amount of $100,000 towards the completion of the Quebec Court House are included the items voted last session, the residue being supposed to represent the balance required for a full and clear settlement of all claims outstanding in the connection on the 30th June last. The item for land and other debts arising out of the construction of th« Q. M. 0, & 0. Railway is approximative and will be duly explained whenever the House is called to vote upon any estimate required for the purpose. In this item, however, is comprised some 845,000 representing the Bellerive property purchased in 1878. The capital of this claim is not payable till 1892, but, in the meantime, the Province has to pay 7 per cent, per annum interest upon it. I understand that an offer was made to pay off this capital, but that it was refused. 27 As for the loss on the Exchange Bank deposit, I have only to state that it cannot be yet ascertained. The trustees are not yet in a position to announce the exact amount of the final dividend to be declared. Now, coming to the assets, it is only necessary to observe that, as they present no material diil'ereuce from their condition as reported last session, no special explanations are called for. Honorable members can judge for themselves of tlieir nature and real value. There is no necessity, I believe, to say anything more on the head of the liabilities and assets, as the explanations I have given should be considered satisfactory in aU respects. III. Fiscal Year 1888-89. As only one-half of this fiscal year has yet expired, it will be readily under- stood that it is impossible for me to indicate precisely the result of its total operations. A glance at the statement of receipts and expenses wiU show that for the moment the latter are in excess, which is, however, easily explained. The expenses, for the six months elapsed to the 31st December, amount to the sum of Sl,893,287.05 And the receipUa lorthe same period to 1,744,802.62 Leaving an excess of expenses over receipts, of $ 148,484.43 But this difference between the receipts and expenses is only temporary and easily understood. The operations of the first six months of the year should not be taken as a criterion by which to judge of the result of the wliole year. It is well known that at certain dates the expenditure is higher than at others ; and the same remark applies to the receipts. For instance, at the begin- ning of the year, we are obliged to make large disbursements for the grants in favor of colonization, education and agriculture. On the other hand, the receipts only come in periodically. This is the case with our principal receipts and especially with those arising from Crown lands or derived from our Federal subsidy and from license dues. Thus, in December, we had to transmit to England a sum of §249,147.51 to meet the interest falling due on the 1st January on a portion of our bonds. This immediately explains the difference, existing on the 31st December, between the receipts and expenses, because in the course of that mouth, we hud to pay out «t least double the amount of our usual monthly expenditure. V 28 On the other hand, since the 1st January, we have received the boJanre of our Federal subsidy, viz., 8569,626.40, and there is half a million doDais dne to the Crown Lands Department, which will c©me in between tliis and the oOih June next. The receipt of this sum, added to the amount of the Federal sabadj. will give us at once a pretty considerable surplus of receipts over ordinary exfxeniikare. These explanations consequently suftice to show that the discrepaaer htvween the receipts and expenses is only temporary. Certain sourci-S of revean-e will exceed the estimate. Crown lands, among others, will yield a larger saan. I als(i expect that the license dues, M'hich were increased 25 per cent, by Jhs: law passed last session, will have the effect of swelling that soupje ot vtxenue. Altogether, according to my estimates, I have every reason to believe that the receipts wiU considerably exceed the figure at which I estimated them. As for the expenses, they show certain variations from my estimates wMch will be easily understood. Apart, however, from the supplementary essimaies, w^hich will be asked from the House, they will not exceed the appropriatioBs. Among the receipts, there is a sum of 82,229,670.45, which has been paid in aa a guarantee deposit by certain railway companies under the Acts 3rMh '\Tc., chap. 3, 40th Vic, chap. 3, and 47th Vic, chap. 70, respecting the subsidies granted to railM ay companies and certain guarantees of interest on their Ixoiidf or debentures by the Province of Quebec In conformity with the rei^tnirements of these laws, the following companies have made the necessary deposit in older to obtun the Government's guarantee of their bonds or debenture.^ : — Temiscouata Railway Comimny. Guarantee of interest during 10 years, from 1st July, 1888. .$ 644573.45 Montreal 2'i.670.45 Conversion of the Debt. I);; ring last session, the Legislature passed an act authorizing the Gorenmieiit to ttQci the coaversioa of the funded debt of the province. The object of this 29 S94.00 i70.45 this measure — as we all know — ^was to effect a considerable saving in the interest service of our public debt. The circumstances were favorable ; capital in Europe was abundant and cheap ; and the prosj»ects generally were such as to warrant the hope that an advantageous conversion could be accomplished. In proposing the scheme to the House, it never occurred to us for a moment to suspect that it would be singled out for such violent and bitter attack, as it has been by those who — we had a right to suppose — should have been actuated in the matter by higher sentements than those of a factious opposition. However, wo soon found out our mistake, for no sooner was the measure fully before tlie public than it was assailed by our opponents in the most injudicious and mischievous spirit. Without stopping to reckon the consequences from any other standpoint than that of party, they resorted to every means in order to defeat a project M'hich was only intended to alleviate a burden that was weighing heavily on our limited resources. All their efforts were directed to alarming the bondholders as to the intentions of the Government, who were misrepresented as bent upon dealing with them unfairly and unjustly. Perfectly indifferent to the injury they were doing to the credit of the proWnce, provide jmiuion. Proceeding on this basis, the items of this account were at different meetings discussed, the greater part were admitted as correct, some were rejected and some reserved — the result being that very considerable progress was made in the settlement of this account. In connection with this account, the question of the liability of the late province of Canada for the increased annuities to the Indians came up for discussion. By the "Eobinson Treaties," in consideration of the cession of certain territory which now form.s part of the province of Ontario, should 'inance having minion, ,088.84 ion and (voperly ■ arrears ses had ^0 been .ccounts. 885, the atcment. f Justice ' Out*irio t of these I it was 188.84 of iccoi'ding [istead of ibmitted. id it was (ayments d on the lu to the (ortioned iputation separace nestings uid some in the Ion of the Indians of the Ontario, 35 annuities were granted to certain Indian tribes nt tlio rate of 31.50 per head, with the couditioTi that, if the increased value of tho lands warranted it, they niiyht be increased to S4 per head. At Confederation these annuities at 81.50 per head v ere capitalized an4 tho amount of the capitalisation was added to the debt of tlr.^ ^jroviuce of Canada. In 1875 the Dominion Covornment decided thai, the increased value of the lands warranted an increase to 84 per head, mi'l by order in council authorized the increase with arrears from 1351 and the irii,erest thereon. In the statement of accounts submitted by tho Dominion in 1882, these arrears, consisting of tho dilference between tlie amount of the annuities at 81.50 per head, the rate at which tho Indians were paid before Confederation, and the 84.00 per head autliorized by the Dominion Covernment iu 1875, for the years from 1851 to 1867, and the interest thereon to the 30th June, 1867, as well as the capitaliz.ition of tho same increase of 82.50 per head, amounting together to the sum of 8356,080 were charge;^ against the account of the late province of Canada as due at the 30th June, 1867. 'Jjiupound interest on this amount was also charged at the rate of 5 per cent, per annum, calculated half-yearly. After hearing a statement of the grounds on which the Dominion based this charge against the province of Canada, in the course of which it was stated that the increase of the annuities was based on the increase which had taken place iu the value of the lands since Confederation, the Treasurer of Ontario and myself distinctly repudiated the right of the Dominion Government to create such a liability as far as it affected the provinces, and declined to discuss the claim, stating that, if tho Dominion Governrajnt wished to press it, it must be done by direct communication with our respective Governments. I, at the same time, took the ground that tho province of Quebec could by no possibility be held liable for any portion of such claims, even if it was established that the increased value of the lands warranted an increase of the annuities under the treaties, as the lands affected were by section 109 of the B. N. A. act subject to any trust existing thereon, and it had been adniitt.'d that tu3 increase was basjd on tho increase that had taken place in the value of tlie lands after they had passed into the possession of Ontario. I may say here that I am of opinion that the capitalization of the original annuities, which was made at Confederation and charged to the debt of the province of Canada, should not have boeu admitted by Quebec, but that the annuities payable to Indians for lands ceded should have continued after Confederation to be a charge on the lauds as being subject to the trust that existed thereon. The accounts of the provinces respectively with the Dominion next came under consideration and, to the surprise of the Treasurer of Ontario and myself, the Minister of Finance stated that he was not prepared to agree to the compounding 36 of interpsl., as it had been computed in the accounts prepared in accordance with the memorandum of 23rd November, 1882, claiming that the memorandum being headed " ^vithoiit prejudice " bound nobody, that compound interest could only be claimed by express agreement, and that there was no agreement, express or implied, on the part of the Dominion Government to pay such interest. We contended on behalf of Ontario and Quebec that, although the memorandum of 1882 was not signed by the Financo Minister, it was prepared at his suggestion and in his department and had been submitted to him and was open at that time to objection or suggestion of amendment by him, but that no indication was made of any objection on his part then or at any time afterwards ; that the heading of the memorandum with the words " without prejudice " was done by the Treasurers to enable their respective Governments to raise objections to it when submitted to them, if they were not satisfied with its terms ; that the assent of the two Provin- cial Governments was practically given, Quebec having passed an order-in-council approving of the memorandum, and ♦ylie acceptance of it by Ontario having been communicated verbally ; that the accounts had been prepared in the Finance Department in the form called for by the memorandum and had been submitted by the Minister of Finance to the Dominion Government and then transmitted to the Treasurers of the two provinces ; that these accounts had been further laid before Parliament in reply to ah address of the House of Commons ; that they had been recast and continued to July, 1885, with the interest compounded as in the first ^statement and that during all this time neither by correspondence nor verbally, neither in Parliament nor out of it, had there been any iatimation that the Dominion Government had not accepted the terms of the memorandum with respect to the computation of interest, and that therefore the Domiiuon was lx)und by its acts and its silent acquiescence to settle the accounts with the interest computed as stated in the memorandum and adopted in the preparation of the accounts. In answer to a statement of the Minister of Finance that the time for the Dominion to object to the terms of the memorandum was when all parties met for a settlement, and that such a time had not occurred before this meeting, it was contended on the part of the provinces that such a time had occurred in 1884, when certainly all the parties had met for a setilement, had examined and discussed the accounts submitted, both as to the items and to the interest, and had asked for a recast of the accounts principally because they considered that the full amount of interest had not been allcwed in the matter of the §10,506,088.84 assumed by the Dominion in 1873. The Honorable Mr. Wood, who was the Treasurer of Ontario in 1882, being summoned by telegraph, confirmed in every respect the contention of the provinces as regarded the making of the memorandum and its apparent acceptance 37 being by the Minister of Finance ; and the Honorable Judge ^Wiirtele, who was the Treasurer of Quebec at the same time, although unable to come to the recent meeting owing to his being on circuit, has sinc« stated his entire accord with Mr. Wood's statement. On the 27th October, the Minister of Finance having informed us that the Dominion Government had decided that it would be impossible to do anything but calculate the accounts at simple interest at 5 per cent, per annum, the Treasurer of Ontario and myself refused distinctly to acquiesce iu such a decision and stated tiiat wo woidd bring the matter before our Governments. Since then a remon- strance on the part of the two provinces has been prepared and signed by the Treasurer of Ontario and myseJf and sent to the Minister of Finance, aul it is difficult to believe that, after a fair consideration of the facts and arguni^intvS therein set forth, the Dominion Government can continue to adhere to the position taken in October last. A statement of accounts to the 30th June, 1888, has been received from the Finance Department with simple interest calculated at 5 per cent, on the item.*, but these accounts we have declined to accept as correct and the matter romaiiis for further consideration and action. It was agreed that the joint arrangement, by which the oftlcers appointed by the Dominion at Ottawa and Qnebec did the Crown timber business for tlie provinces of Ontario and Quebec, the expenses being divided between the three Govemmonts, should cease after the 1st January, 1889. This has taken place and Quebec's share of the business is now under the immediate control of the Crown Lands Department. Other important matters were toncheu upon and partly discussed at the meeting and we were in hopes that we Were on the higli read to the settlement 80 much to be desired, when the adverse decision of tlie Domiaion Government forced us to close the confen-ace, It is to be hoped that the Federal GSoverumeut will I'eoonsider its decision, because, if persisted ir., it wi'l be most prejudicial to the inte'-ests of the province. By the 47th Victoria, chap. 4, of the statut^^ of Cav.», . wo received an increase of 8127,460.86 to cur Dominion subsidy. Capita) >,ed, this increase rer»re3ent3 a sum of $2,549,213.61, which stands entered to our crjdit iu the statement of accounts between the Dominion G^overnment and the province of Quebec rendered up to the 30th June, 1885. With tliis imount to our credit, the balance in our favor at that date sto»xl at $1,861,594.44; but, if the $2,549,213.61, which represents at 5 per cent, the amount of our additional subsidy, Iw deducted, there will be a balance ci:S687,619, against us and in favor of the Dominion. Now, if. ia < ur settlement of accounts, this balance is admitted to be bgitima^/ely due, we t.aaU either have to repay it, 88 if we wish to preserve our subsidy at its present figure or we shall have to submit to receive 5 per cent, interest on the balance of $1,861,954.44, viz., $93,079.72 annually, instead of $127,460.86. According to the arrangement concluded with the Federal Government on the occasion of our visit to Ottawa, by which that Government assumed the 34,597,690, representing the surplus of the debtcliargcd against us at Confederation, the deficit just referred to would be about covered. Unfortunately for us, however, it will be materially increased and the amount of our subsidy proportionally diminished, if, notwithstanding the understanding rela- tive to the mode of keeping the accounts, which seems to have been admitted in 1882 and 1884, the Federal Government persists in its refusal to allow us com- pound interest. Hitherto, pending a final settlement of accounts, the Federal Government has always paid us the full amount of our subsidy, without making any deduction for certain items charged to us under tlie award. I may add that the greater part of the items, which figure in our account with the Dominion, had been already admitted by our prodece^5sor3 as legitimately due, so that we have nothing to expect from that quarter. Consequently to succeed in wiping out the deficit, we can only look to the extra amount which compound interest would give us, if the Federal Government ultimately allows it. This, in a few words, is the present situation of matters as regards our accounts with the Dominion. Needless to state tliat we are not responsible for it ; nor am I prepared to say that our predecessors are to blame for it either. All the same, however, I am inclined to believe that the award was not as favorable to us as it was to Ontario. Frankly speaking, after studying the arbitration, I find that the arbitra- tors did not render us justice. ■■ Let me simply remark, before 1 conclude my observations on this head, that this question of the settlement of our accounts with the Dominion should not be considered from a party point of view, as tho interests of the province demand that we should be unanimous upon it. Division in such a matter would be most hurtful. If we ai-e saddled with the Indian annuities and other items for which we are liable under the award, the balance iu our favor will be much diminished and the result as a whole very prejudicial to the interests of the province. Under the circumstances, I believe I need hardly lay stress on the necessity of union on this vital (juestion. On the other hand, looking at the soundness of our claim and the importance of the interests at stake, there is every reason to hope that the Federal Government will act with impartiality and treat us with the justice to which we arc entitled. 39 VII. Common School Fanil. To a proper undcistancling of tl e actual position of this question, it may be well that I lihould briefly recall the tacts connected with its history. lu vivtu'j of chapter 26 of the Jtn'ised St.i'utes of Canada, a million acres of public lands in Ontario were set apart for the support of elementary schools and the amount realized from the sale of these lands was to be invested to constitute a fund for the purpose, the proceeds of which were to be divided from year to year between the old pi-ovinces of Upper and Lower Canada in proportion to their respective populations according to the last census, with the exception, however, of a fourth of the proceeds of the lands sold between the 14th June, 18.33, and the 6th March, 1861, and applied to the Upper Canada Improvement Fund, and of six per cent, on the amount of collections to pay the expenses of management. By the Confederation Act, this fund, which was known under the name of the Common School Fund, was one of the assets to be divided between the two provinces and left to the decision of three arbitratort selected, one by Ontario, one by Quebec and the third by the Government of Canada, and its disposal was settled by the award of these arbitrators on the 3rd September, 1870, which award was confirmed by the Privy Council on the 11th March, 1878. By section 8 of this award, it was decided that the balance of the Common School Fund, together with the investments forming part of it, should continue to be held in trust by the Federal Government, and that the revenues derived there- from i^ince the 30th June, 1867, and that may liereafter be derived from the same sou. \^, should be divided between the said provinces of Ontario and Quebec and p H to them respectively in the manner indicated by section 5 of chapter 26 of the lievised Statutes of Canada. It ^^MS further decreed by section S of the award that all the moneys received by tl e said p sviuce of Ontario since the 30th day of June, 1867, or that may be hereafter re '.eived from and for the fund oi the common school lands reserved to support the common schools of the late province of Canada, should be paid into the hands of the Federal Government, to be iuvestod in conformity with the provisions of section 3 of said chapter 26 of the Eevised Statutes of Canada, and that the income derived therefrom should bo divided between Ontario and Quebec and be paid to ■ ht m respectively according to the terras of section 5 of the same chapter. ]iy section 10 of the same award, the province of Ontario was to have the r'i]-'X to retain upon the collections 6 per cent, for the sale and management of the saii ianda, and to further take bnd retain for the Upper Canada Improvement 40 Fund a fourth of the proceeds of the lands sold between the 14th June, 1853, and the Gth March, 1861, received since the 30th June, 1867, or that may be hereafter received, first deducting the cost of management, as above stated. But the Government of Ontario, instead of paying into the hands of the Federal Government — as they were bound to do by the award — the proceeds of tlie liiiids sold ])roviou3 to 1807, as well as the proceeds of the sales made since, retiined them in their own hands. No attempt was apparently made by the province of Quebec to obtain a settlement until 1880, when the Legislature passed a law authorizing the Lieutenant Governor-in-Council to make a settlement. But no settlement was ever effected. When we took charge of the affairs of the province the question at once engaged our serious atteuli( md, seeing that there still remained unsold a por- tion of these lands and that it ,v ; irablo that the share of the fund belonging to the province of Quebec should l^ /initely settled and invested conformably to the provisions of chap. 26 of the Eevised Statutes of Canada and the terms of the award dividing the liabilities and assets of the provinces of Ontario and Quebec, we made approaches to the Government of Ontario with a view to arrive at a friendly understanding relative to the settlement of thft question, I am happy to say that we were met in the same amicable spirit by the Government of Ontario, who received our approaches favorably. The negotiations entered into for the purpose of arriving at a settlement finally resulted in an ivgree- ment to submit all the points in dispute to arbitration and in t^e payment to us by Ontario of SIOO.OOO on account of the arrears due us. Pursuant to this agroement between the two Governments, this Legislature, during its last session, passed an act intituled "An act providing for the settlement of certain questions in dispute between the provinces of Quebec and Ontario by means of arltitration" and a similar act was passed by the Legislature of Ontario. Section 1 of this act (51-52 Vic, chap. 12,) provides that for the final and conclusive determination of the question^ in dispute " the Lieutenant-Grovemor-in- " Council may unite with the Government of Ontario in the appointment of throe " arbitrators to whom shall be referred such of these questions as the Governments " of the said provinces shall mutually agree to submit." Immediately after the session, negotiations were resumed with the •\iew of giving effect to the provisions of this act and the present position of the affair is this : Arbitrators have been named, but, in consequence of a difference of opinion between the two Governments as to what matters should be referred to these arbitratot-s, the arbitration has not yet been proceeded with. Our Government are of opinion that the arbitration should embrace all questions as to the school lands and these only, while the Ontario Government desire that it should also 41 since, cover questions relating to the Upper Ctinada Impvovoinent Fund, &c., and any other question that might arise incidentally bstween us in order to arrive at a complete and final settlement. We very much regret the delay in the arrangement of this matter, but the want of an understanding between the two Governments as to the questions to be submitted to the arbitrators is the reason why the arbitration has not yet taken place. We have every reason to believe, however, that, with the friendly spirit which has always prevailed between the two Governments since the beginning of the negotiations, it will be possible to ultimately roach a solution of the difficulty, which will be acceptable to both parties. VIII. Receipts and Appropriations for 1889-90. liew of jifrair is ■opinion these Irnment school lid also I estimate the receipts of this fiscal year at S3,463,672.80, of which $58,000 will be receipts on capital account and $3,405,672.80 ordicary revenue. This estimate is based on the receipts of the last fiscal year, allowing for a possible increase or decrease in certain items. The following are the receipts upon which I count : Federal Subsidy : Subsid}^ payable under the Confederation Act...$ 959,252.80 Interest on trust funds 55,459.32 Special subsidy under 47 Vic, chap. 4 127,460.68 Interest on railway subsidies under 47 Vic, chap. 8 119,700.00 Sl,2ei,872.80 Interest : Interest on price of sale of Q. M. O. & 0. liailway 3375,000.00 Interest on loans and deposits 55,000.00 Interest on collections made by Ontario from common schooUands 20,000.00 $ 450,000.00 6 42 Administration of Justice : Law stamps 8 170,000.00 Fees 3,000.00 Building and jury fund 16,000.00 Contributions for the maintenance of vagrants in prisons 19,0C0.OO Gaol guard, Quebec and Montreal Fines House of correction, Montreal Montreal Court House High Constable's fees, Quebec 4,000.00 2,000.00 1,000.00 2,500.00 600.00 Hegistration stamps Licenses Crown lands Taxes on commercial corporations Percentage on fees .;i -leTt .In public officers Percentege on renewals of hypothecs Legislation Official Gazette Lunatic asylums, contributions from municipalities. PubUc buildings, rents, &c Contributions to pension fund Casual revenue Quebec Fire Loan Refunds Municipal Loan Fund. $ 218,100.00 17.000.00 375,000.00 836,000.00 125,000.00 8,500.00 400.00 2.500.00 22.800.00 30,000.00 1,000.00 5,500.00 1,500.00 500.00 $3,405,672.80 8,000.00 50.000.00 $3,463,672.80 I may state that this estimate has been prepared with the greatest possible care and that we hope to realize the whole amount. The sums, forming the amount to be received from the Domimon Gkirern- ment, call for no explanation. I place at $20,000 the sum which we shall receive from the Ontario Government for the interest on collections from common school lands. Pozsoant to a recent agreement with the Goverrmient of Quebec, the Grovenunent of Ontario intends to pay into the hands of the Federal Government the capital of the 43 J,100.00 r.ooo.oo ;.o©o.oo 5,000.00 5,000.00 8.500.00 400.00 2.500.00 |2,800.00 0,000.00 ,000.00 5,500.00 ,500.00 500.00 5.672.80 8,000.00 0,000.00 3.672.80 Govern- Ontario 'oTSiiant Ontario of the amounts collected since Confederation from the sale of lands appropriated to the common school fund. Our share of this amount will bo about 8400,000, and the moment it has been deposited, we shall be entitled to interest upon it at 5 per cent. The receipts arising from the administration of justice will produce at least the figure estimated, seeing that they are based on the average of preceding years. Nevertheless they may possibly exceed my estimate, but I prefer to take the average figure so as to avoid mistakes in my calculations. I estimate the revenue from licenses at $375,000 instead of $340,000, the figure of last year's estimate. This increase of §35,000 is not exaggerated, if it be to taken into account that the license fees were raised 25 per cent, by the law of last session. The information supplied me by the Treasury officers leads me to believe that we shall realiza the amount set down in my estimate. Special attention has Ijeen paid to the enforcement of the law and we have reason to hope that the reforms effected in this service by the amendments of last session will enable us to more efficaciously control this branch of the public service and to repress the abuses which are inherent to the liquor traffic. During the present session, the Government intends to further modify this law, but not so as to affect it ia any radical way. The effect of these changes will rather be to render more practicable the important amendments to which the law was subjected last session. The House will understand that, for the moment, it would not be prudent to go beyond this, because it should not be forgotten that the law, as amended, has not yet been put in operation. Before making any further important changes in it or thinking of having recourse to more extended legislation, the bill of last session ought to receive a fair trial. It will, doubtless, bo rememberei that last session a bill was ceferred to a select committee of the House with instructions to study and report upon the question. A large number of modifications were proposed, some of which were accepted by the committee and others simply suggested, and tho biU was submit- ted to the House, which acted upon the committee's recommendation and ordered it to be reprinted and distributed. I believe that, in the public interest, as well as in the interest of those who are anxious to have the law made as perfect as possible, this bill should remain under consideration in order to fully grasp its bearing and the real signification of the amendments and suggestions which have been made, before using it as the basis of legislation intended to replace th3 law actually in force. I estimate at S886,000 the receipts fh»m Crown lands. For the current year, I had set them down at $821,000; but this figure \iill be cousideiably exceeded, so that the estimate for the next fiscal year is not excessive, if account 44 be taken of the increase consequent on the reforms made in the tariff of "woods and forests. I may add that these reforms will fully realize the hopes as to the additional revenue which this change of tariff should yield. The revenue arising from taxes on commercial corporations is placed at $125,000. This figure is based on the expected receipts during the present fiscal year. On the 31st December, we had collected $117,581 from this source, and, according to the information furnished me, the amount remaining to come in between this and the 30th June next will make up the difference between my estimate and the actual receipts. Of course, whatever may be the nature of a tax, it is always regarded as onerous by the taxpayers. This is, no doubt, why a certain number of these, finding themselves a little more burthened than under the old law, protested against this tax after the new apportionment made last session. But it is equally true that the corporations, which made the most outcry against that change, were precisely the ones which, taking their capital into account, could more easily support the increase occasioned by the new apportionment. That apportionment, however, was not the less fair, seeing that it had for effect to lighten the burthen on the corporations with small capital by placing them all on a footing of eqnality through the agency of a tariff graduated according to capital. In all cases, judging from the result obtained, it is perfectly clear that those, who pretended that that apportionment was only used as a pretext to aggravate the burthen of the tax, must now perceive that they were mistaken and that my declarations were true. I calculate upon getting $30,000 from the municipalities for their contributions to the cost of maintaining our insane asylums. This is a moderate estimate and we shall meet with no difficulty in realizing it, if we can succeed in collecting the arrears due us. The collection of this revenue is receiving all possible attention from the Comptroller of Revenue. I hope to get $50,000 from the indebtedness to the Municipal Loan Fund. This receipt is more or less uncertain. During the current fiscal year, the amount upon which we counted has been exceeded. Wo can therefore without exaggeration put down $50,000 with the hope of realizing the amount. But, as I have already stated, this receipt is always uncertain, inasmuch as the municipalities show little or no hurry to settle up their indebtedness to the Municipal Loan Fund. Some of them are still seriously under the impression that they will never be called on to pay off a debt from which they deemed themselves freed forever, as they were repeatedly led to believe. Let us now turn to the head of expenses : I estimate at $4,389,024.44 the total payments of this fiscal year, as follows : — 46 Ordinary Expenses : Service of the public debt 81, 186,71. 'i.SO Administrative service 2,166,455,01 83,353,170.51 Ex^pcnses imputable to capital: Constructiou of public buildings, Sea S270,853.93 Eailway subsidies 765,000.00 81,035,853.93 Total 84,389,024.44: Now let us examine the details, which form tliis general result : The first item is the service of the public debt : Interest on the funded debt ' 81,021,279.05 " on temporary deposits, that is to say, on trusts and on guarantee deposits 95,102.51 81,116,381,56 Sinking fund and redemption of bonds »862,133.94 Expenses of management 8,200.00 870,333.94 81,186,715.50 This service shows an increase of 886,562.50; but this increase is easily explained. This sum is intended to meet the interest on trust funds and on the guarantee deposits made by certain railway companies. That of the Lake St. John company is banked, but the bonds have not yet been endorsed by the Government. As already stated, these deposits have been made in virtue of the acts 39 Vic, chap. 3 ; 40 Vic, chap. 3, and 47 Vic, chap. 70, respecting subsidies granted to railway companies and certain guarantees of interest on their bonds. To obtain the Government guarantee on their bonds, certain companies have complied with the statutes in virtue of which they are entitled to this guarantee, which will necessi- tate a larger sum for interest than the amount required for the ordinary service. On the other hand, as these deposits bear 4 per ceat. interest, we expect to receive a proportional amount to the one we will have to pay out. The expenses of legislation are placed at 8207,142.50. For the fiscal year 1888, these expenses reached 8228,994.88 and, for the current year, they will probably reach the figure of 8224,544,16. There is consequently a reduction of 821,852.38 in the probable expenses of the present year. This reduction is made up as tollows : 46 Salaries, contingencies, 'printing, binding d'c. Logislative Council 8 987.15 Legislative Assembly 15,414.51 Library 1,000.00 S 17,401.66 For the current year, the expenses of civil government will probably amount to $231,763.50. For next year, we ask $233,917.00, which shows an increase of 82,153.50. This increase is apportioned as follows : S8,141 more for salaries, &c and $5,987.50 less for contingent expenses. The increase arises chiefly from the organization of the new ministry of President of the Council — $5,G00 — $2,000 additional for the service of the revenue department, expenses occasioned by the changes made in this service; $2,041 for public works, and $1,100 for public instruction. Total, $10,741.00. But the following sums must be deducted from this amount: Provincial Secretary, $300 less, Attorney General, $400, Crown Lands, $500 ; and Agriculture and Colonization, $1,400, forming a total of $2,600, which must be struck off from the $10,741, leaving as increase a balance of $8,141. But from this balance must be deducted the $5,987.50 less of contingent expenses and then $2,153.50 remains for the increase as above stated. For the administration of justice, we ask $495,938.98. This year, it will probably cost $515,272.31 ; difference less next year $38,956.31. We hope that this difference will be realized. At the same, it is very difficult to say in advance whether some demand may not arise of a nature to lessen the sum of the reductions upon which we count, because the expenditure for this service is very difficult to control. The appropriation for public instruction is $387,185.00 or $1,350 more than the amount voted last session for the current year. The following are the items upon which this increase bears : — Educational Record, Montreal $ 250.00 Journal cle I' Instruction Puhlique 750.00 Changes in the education laws, entailing an expense for printing 1,200.00 College Commercial of St. Henri 200.00 St. Vincent de Paul 500.00 Municipality of Amherst, to build a school house 200.00 . Municipality of Ponsonby, " " 200.00 Commercial College of St. Cutbbert, aid to build 1,000.00 Commercial College of West Famham, aid to build a wharf or revet- ment wall to protect that edifice against the wearing away of the bank caused by the river Yamaska 1,500.00 47 than 50.00 50.00 00.00 00.00 [00.00 00.00 loo.oo loo.oo loo.oo Tho Coraraissioners of tho City of Hull, to enlarge a school house 1,000.00 The Kedemptorist Fathers of Montreal, aid to build a school house at Point St. Charles, Montreal 1,000 00 College of Arthabaskavillo, towards its construction .i 250.ul/ Conveutof St. JohnofMatha, " " 400.00 lloman Ciitholic school, Granby 250.00 Convent of UAssorai^tion, to build a school hcusj 250.00 Quebec Geographical Society 100.00 St. Patrick's Literary Institute, Quebec 300.00 Hemmingford Mechanics' Institute and Literary Association 200.00 Montreal College of Pharmacy ; 2o0.00 L'QLuvre du Patronage, Quebec 250.00 $ 10,050.00 The following grants disappear : — College of I'lle Perrot, Montreal $ 200.00 Soeurs du S. Norn de J^sus-Marie, St-Barth^lemy 200.00 College Sainte-Genevi^ve, Jacques-Cartier 1,800.00 Commercial College of Terrebonne ♦ 2,000.00 Distribution of education laws to school commissioners and trustees 4,500.00 8,700.00 Increase in this service $ 1,350.00 We would have been glad to have been able to do more for this service, the value and importance of which the Government fully understand ; but, notwith- standing all our good will, we are per force compelled to remain within the limits^ beyond which we cannot go without hurting other services, the importance of which cannot be disputed. We regret our inability to meet the wishes of those who I.,:... made application for grants, all for the most commendable objects. Bui, unfortunately, the aggregate of these applications forms so large an amount as to altogether preclude the idea of entering such a sum in the budget, as it would be far beyond our means. We have therefore been obliged to remain within the bounds of possibility. The credit asked for agriculture and colonization amounts to $246,900.00, For the current year, its figure is $244,600.00. So that there is a slight increase of $2,300. 48 Tlio new items are : Journal da V Agriculture, incxQUSQ S 900.00 Veteriimry School 1,800.00 Lectures on agriculture 600.00 To brintj immigrants from England, France and oth'^r countries 1,000,00 Socii'te generule do colonisation 5,0' '^ lload in the interior of the counties of Bonaventure and Gaspe, between Cascapediac and Gasp<5 2,000.00 To deepen the river Lacadie, in the county of Huntingdon 500.00 Metapediac bridge 2,400.00 Drainage works in the 20th and 21st ranges of Upton, to reclaim 4,000 to 5,000 acres of good land in the parishes of St. Ephrem and St. Helene, provided that the parties interested furnish an equal sum 2,000.00 Drainage works at river St. Pierre, in the parish of St. Hermas, balance of the $1,200 promised by Hon. J. J. Eoss 500.00 To drain a swamp at Samte-Brigitte, county of Iberville 3,000.00 $ 18,95f "^O The retrenchments affect the following items : Provincial exhibition, Montreal $ 10,000.00 Deepening of the river LacoUe, in order to prevent inundations and to reclaim a large tract of land 2,500,00 Herd book 1,000.00 Stenographers 1,500.00 Arboriculture , 150.00 Purchase of materials, account books 1,500.00 3^ 16,650.00 $ 2,300.00 The appropriation for public works and buildings imputable to ordinary revenue is $95,906.76. For the current year, the probable expense will be 8116,168.13, which makes a reduction of $20,261.37 in favor of the appropriation asked for next year. For the twelve months ending on the 30th June next, the rents, insurances and repairs of public buildings will cost $69,250.00. The same service for next year is entered in the budget at $70,000.00, which raakes an increase of $750.00. Last year, $60,000 was put down in the budget for this service, but this amount is not considered sufi&cient. Since we have been in office, we have striven to keep this expense within the appropriation, but without success. 49 ,300.00 Ordinary [will be Ipriation pit, the le same akes an Ifor this in office, Isuccess. According to the official and detailed statement of the department, this service calls for even a larger outlay than the one we ask ; but we wish to keep within proper bounds and to place in the budget a sura, which, though less than that recom- mended by the engineer and otlicers of the department, should be sufficient to meet the strictly noces^iiry re(|uircments. We ask S20,000 for repairs to courthouses and gaols, which is 81G,bl7.57 less than the cost of the repairs during the current year. This again is another hard item to control, and the demands endorsed by the official reports call for a larger sum than that entered in the budget ; but, while desiring to meet all the requirements of the service, it is impossible for us to charge the budget, in a single year, with all the repairs desired and which even might be regarded as urgent enough if we had not other demands to satisfy, which cannot be easily overlooked. The sum asked for insurance is S2,000 instead of $7,194 for the current year. This decrease is easily exi^lained. For next year we place $2,000 in the budget for the insurance of the court house, while, for the current year, this insurance was. at the expense of the contractors. The $7,194 entered in the budget for IL current year have been employed to pay the expense of insurance on the public buildings for a term of three years, so that an appropriation for this object is unnecessary. There are few changes in the charities. We have received from ' all sides pressing solicitations to increase already existing grants for very laudable objects, as well as a multitude of new applications for grants from institutions established for the relief of the unfortunate poor. We would have liked to have been able to meet them all favorably, but the state of the finances of the province does not permit us to contribute, as we would wish, to all the good works towards which Government aid has been solicited. The multiplicity of these applications has been such that it was morally impossible to grant them, even partially. To meet the desires of all the applicants, a sum far beyond the means placed at our disposal would be needed. In acquiescing even in a small number of their demands, we would have exposed ourselves to recriminations on the part of those who had obtaipf.d nothing, as all these applications were very legitimate. I must avow also that, in a matter of this kind, it is very hard to resist the pressure brought to bear upon the Government and that it is painful to be obliged to refuse persons who have so much at heart the success of the works they seek to promote and the object of which is to relieve the poor and the unfortunate. But, for the moment, it is impossible to burthen the Treasury with a host of charges, which end by becoming regular perpetual rents. Again, if we c^uld change from time to time the dest;ination of these grants so as to transfer them to the municipalities in which the want of these benevolent institutions is most felt, 60 it would be possible to do more good, even with the amount appropriated for this purpose. But it is impossible to entertain this idea, as the institutions which are most in a position to maintain themselves would be the first to tax us with injustice and to condemn such a policy. We have therefore only increa?ed by ;i trifle the appropriation for charities. The amount voted for the purpose for the cuirout year is 84:1,930, and we ask for next year .§44,21)6, which sliovs an increase of $2, 250. On the oih°r hand, we have reduced the grant for the maintenimce of the insane in the hope that we may effect a saving in this service as a result of the legislation which we wish to have adopted. The total of the credits asked for charities and for the maintenance of the insane is $250,206.00. Uhe appropriation for the current year is 8271,956.00, which shows o diminution of 812,750 in next year's favor. For the current year the expenses of the Crown Lands Depailment will reach $212,200.00. We estimate them for next year at 8181,000, which makes a difference less of 831,200. The items to be deducted are the following : For the cadastre 88,0C0.00 Surveys 23,000,00 831,000.00 The following aro the items to be added : To general expenses 82,000.00 Fisheries 1,800.00 Accounts in suspense 2,000.00 • Protection ol forests against fire... 5,000.00 810,800.00 Leaving a balance less of §20,200.000 For surveys, 845,000 are asked. This amount is less than the probable expense of the eurjent year. It represents the average of this expense of late years. The appropriation for general expenses is higher by 82,000 than thp amount expended for the current year. There is now no doubt, judging from the results of the modifications made in the tariff of ground rents and stumpage dues, that these changes will realise our anticipations, so that, if the new service entails an additional expense, the latter will be amply ccrapenaated by the increased receipts. Under the head of " j liacellaneous generally," the increase in the other services is distributed as follows : Iimouut lade in ize our latter jrvices i\ 51 Printing report of Saperinteudent of Public Instruction S2.331.75 Distribution to the teachers of the province of ]\Iaguan's manual on elementary teaching 2,000.00 Distribution of amendments to the Municipal Code 250.00 Exhibition in the county of Cliiceiutimi and Saguenay 2,000.00 To pay Joseph Dussault for 10,000 copies of " La Baie d'Hudson " 1,500.00 Hospital of Temiscaraingae 500.00 Hotel-Dieude St. Hyacinthe. 500.00 Hospital o*"the Grey Xuns, Si. Jerome...... 500.00 College of lOt. Bemardin de Waterloo 500.00 On the other hand, the fallowing items disappear : Copying and arrangement of old French records, &c §1 0,000. 00 Inspection of railways 1,000.00 " Droit Criminel, by Hon, Jndge Xaschereau 1,000.00 Indemnity to the family of the late 3*fr. St. Hilare, member for Chicoutimi 600.00 Indemmty and expenses relative to errors in survey between the parish of Ange Gardien, (Rouville) and the Eastern Townships.. 10,500.00 Commission on insane asylums 0,000.00 Agricultural cojiimission 5,000.00 Aid to sufferers by Hull fire 5,000.00 Municipality of St. I^ou, county of Maskinonge, to repair damages caused by a land sUde 800.00 Indemnity to inhabitants of Soulanges. Vaudreuil, Beauharnois, Laprairio and Chambly counties, for damages caused iu June, 1888, by a wind and hail storm 6,000.00 Indemnity to the owners of horses, cs^ttle, &c., Inirned iu 1887, on the occasion of the Sherbrooke exhibition 3,000,00 Metapediac bridge 5,600.00 To repair the old church at Tadousac 200.00 " Manuel des In&pecteurs Agraires," by Mr. Chagnon 1,200.00 Agrarian Inspectors' Manual, by Mr. Casgnon 1,200.00 Hospital of St. Jeau d'Iberville , 500.00 Indemnity to the member? of the I/jgLslative Assemby who, at the request of the Attorney General, worked at the codification of the statutes 3,420.00 Distribution of Municipal Code, differt-nec due . 1,250.00 !iJ62,270.00 Less the increases 20,081.75 Total decreases 952,188.25 rr 52 For the current year, the amount required for " miscellaneous services generally ", including the expenses of the Crown Lands Department, will probably reach the sum of $331,880.00. lor ncAt year, we ask $259,881.75, which makes a dilference of $71,998.25 less. The total of the expenses imputable to capital is not so large as for the current year. "We ask $270,853.93 for public works and buildings, old claims, &c,, and $765,000.00 for subsidies to railways. These two amounts form a total of $1,035,853.93. For the current year, the expenditure for public works and buildings, including railway subsidies, will reach $1,235,885.2'*, or an excess of f ,031.31 over the amount we propose to spend next year. The following table will show the items in v/hich there are increases or decreases : — 1889. 1890. Parliament Buildings $125,729.53 $112,760.00 Quebec Court House 42,733.59 7,500.00 Spencer Wood, construction of a green house, cellar, &c. 4,000.00 4,000.00 Iron bridges in municipalities, of which $50,000.00 is a revote 100,000.00 100,000.00 New vaults in court houses and gaols in counties of Dorchester, Levis, Bellechasse, L'Islet, Montn agny, Kamouraska, Temiscouata, Lotbini6re, Megantc, Ar- thabaska, Wolfe 10,000.00 10,000.00 Kamouraska Circuit Court 4,000.00 1,012.00 Heating apparatus in court houses and gaols in new districts 6,000.00 Construction of a wing to court house and gaol, county of Bonaventure 4,000.00 Courthouse, Arthabaska ' 1,400.00 « Montreal 50,000.00 Codification of the statutes 63,000.00 Protestant insane asylum, Montreal 22,821.29 Legislative Council, contingencies 3,150.83 Loan to Dr. Gauvreau 2,500.00 Library of the Civil Code (Biblioth^que du Code Civil).. 6,000.00 Dictionary of the language of numbers — DeBoucherville 2,785.00 Heirs of the late John Langelier 5,000.00 Oil pprtitvits Q,f tibe .SpeaHer?.,....,.,...... ...... ..,,,,,.,,...,,. 1,250.00 1,800.00 63 3,000.00 f,785.00 Looo.oo ,800.00 Brother Arnold, repairs to his school ', Purchase of the library of late Judge Polette Heirs of late Judge Loranger W. P. Lockwood, settlement of account 10,000.00 Crown Lands Department, regional map of the province of Quebec 1,814.53 3,000.00 2,182.40 8,000.00 $450,585.24 S27U,853.93 The expenses which we propose to incur for the construction of public buildings are of absolute necessity. As for the Parliament House, the sum asked includes $48,000 votod last year and which has not yet been employed for ihe purpose for wliich it was intended; but this amount, as well as the balance of 8112,729.53, is absolutely required to meet the cost of the enclosure wall and other expenses connected with the building. In the amount asked, there is also included a sum of §10,000 for statues. With the exception of the enclosure Wall and the purchase of certain properties, the Parliament House is virtually completed. As for the Court House, save a few unimportant works, that building is finished, but there remains a balance of account to settle with the contractor which we did not wish for the moment to enter in the budget, seeing that there is a difference of opinion between the Government and him on the subject of the amount claimed. The appropriation for iron bridges is $100,000, but it is in reality only $50,000, as $50,000 remaining of the $100,000 voted last year will be expended this year. As regards the subsidies to railways, it is difficult to make a precise estimate of the amount required for this service. Moreover, all depends on the rapidity with which the companies push their works. At all events, whatever may be the march of this service, it will not suffer, as the Government has the neces- sary statutory authority to pay the railway subsidies. Now, bringing together the estimate of the ordinary receipts and that of the ordinary expenses for 1889-90, we get the following result : Ordinary receipts $3,405,672.80 Ordinary expenses 3,353,170.51 $ 52,502.29 The expenditure necessarily increases with the requirements of the public service and the new wants arising as a consequence of the progress whioh is taking 64 place in the development of the resources of the country ; but this increase is rat)ier apparent than real as regards the controllable services, if the increase of the interest service be taken into account. However, we have at the same time found means to increase the revenues to such a degree as to leave a surplus in the ordinary receipts, without imposing the slightest new burthen on the people and while devoting large sums to the advance- ment of colonization, public instruction and the general interests of agriculture. To attain this end, the expense of certain services had necessarily to be increased, but this expenditure has been fully compensated by the results attained. I believe that the House and the country will fully admit that we have reaUy and effectually labored to restore the equilibrium in our finances, and it seems to me that we have the right to say that our labor has not been in vain. Supplementary Estimates for 1888-89. The insufficiency of the appropriations voted last session for the current year necessitates a supplementary budget pf S104,392.01. The following are the additional sums required to cover the expenses of the present fiscal year : Legislation 815,094.16 Civil government 8,287.50 Administration of justice 19,333.33 Literary and scientific institutions 250.00 Public works 11,945.73 Miscellaneous services 28,360.00 Special expenses 19,321.29 Kailways 1,800.00 $104,392.01 The $15,094.16 for legislation are intended to pay for the following services : Legislative Council : Stationery, salaries &c $2,542.15 Legislative Assembly : Salaries 1,000.00 Translations.*. 4 1,15100 Stenographers 1,157.60 Miscellaneous 249.05 Writers and messengers 2,712.94 Printing and binding 6,000.00 Advertising , 281.42 ' ' $15,094.16 66 10.00 5100 7.60 9.05 |2.94 lo.oo |l.42 The 88,287.50 asked for civil government are intended to cover the shortage in the appropriation made last session ; in this amount is included S2,500 required by the department of Public Instruction to pay the expense of printing its report. For the administration of justice, $19,333.33 are asked, 810,000 of this amount baing called for by the insufficiency of the appropriation for the expenses of this service ; 85,497.98 to pay the Grand Trunk's claim for disbursiuents in the Fahey affair ; and the balance for the police service, &c. To meet the additional salary granted to Mr. Scaton, 8250 are asked. For public works, 811,945.73 are wanted, 89,250 of it to cover the insufficiency of the appropriation made for the cost of maintaining public buildings and 82,695.73 for repairs to court houses and gaols. All these expenses are considered indis- pensable by the departmental officers. The sum of 860,000 voted for the maintenance of public buildings has always been looked upon as insufficient, and, in point of fact, this appropriation has to be increased every year by a sup- plementary vote. The maintenance of these buildings is more expensive than it was at the beginning of the installation of the Departments and Legislature. A large staff is required to suitably perform the service of so large an edifice. The following amounts are needed by the Crown Lands Department : Cadastre expenses 8 8,000.00 General expenses 18,000.00 826,000,00 These two sums are required to cover the shortage in the appropriations for the purpose. There is also a sum required to meet the following liabilities and expenses : Portraits of the Speakers in oil colors 8 1,250.00 Inspection of railways 500.00 Bridge at Barrachois, Gaspe 610.00 82,360.00 Special Expenses : Appropriation to complete the court house atKamouraska 8 1,500.00 I'rotestant insane asylum, Montreal, balance of the proceeds of sale of the Leduc farm 7,821.00 Settlement of a petition of right in favor of W. P. Lockwood, for a claim against the Crown Lands Department 10,000.00 819,321.29 For claims against the Q. M. 0. & 0. Railway on construction account 1,800.00 "^ T 66 IX. .General Remarks on the Financial Situation. I: 5f. Mr. Spsaker, the statement I have just made is of a nature, I think, to convince the House and the country that we have accomplished vithin the range of possibility all that could have been reasonably expected of us. In the matter of our finances, we have succeeded, by means of wise reforms and without bxirthening the taxpayers, in increasing our receipts to a figme never before reached by them. To attain this object, we had necessarily to exerdse a greater supervision over the collection of the public moneys and to effect chaises which have resulted in a marked increase in certain sources of our revenne. It is useless to review in detail the items affected by these changes, as I have already referred to them in the course of my remarks. But, if, on the one hand, we have succeeded in increasing the amount of our receipts, on the other, notwithstanding all our good will in that direction, we have found it impossible to control, as much »3 we might have desired, the figure of the expenditure occasioned by a poUey of initiative and progress in keeping with the views of all who have at heart the welfare of the province, even at the cost of some sacrifices. It is my experience that the country desires a broad and liberal policy in all that relates to the development of its resources. Within the measure of our power and means, we have endeavored to give practical effect to a policy of this kind, while keeping within the bounds prescribed by iJie state of our finances. Nevertheless, the expenditure has not been out of proportion to the good which we hoped to attain. At the same time, it is easily explained, and its results are visible in the impulse which has been given to the development of our railway system, to the work of agriculture and colonization, to the iron bridge policy, and to every undertaking of a useful and beneficial character for the interests of the province. Still, the increase of our revenue is far yet from being commensurate T^ith the needs of a country in which so much remains to be done and which favois the subsidizing of every project aimed at the development of its natural leaouroes. But, unfortunately, it is not within the measure of the means at oar command to gratify in a day all the wishes and aspirations of a people who ardently desire the realization of all the projects, which they advocate. We are well disposed to meet the views of those who are anxious to promote in the highest degree the well-being of the province. Indeed, such is our policy, but we are necessarfly com- pelled to keep within the bounds of possibility and to moderate the zeal of those who are prepared even to make the greatest sacrifices for the attainment id the object of their efforts ; for, if not, we may run the risk of jeopardizing our dearest 57 interests. It is tlie fluty of the Govenimeiit, as the j:,'iumlitius of a sacred trust, tc proceed with the prudencf and wisdom of men, who fully understand the responsibility of the task entrusted to them. The House and country would do well to remember that the puliev of laryelv subsidizing public enterprises necessarily entails an increase of liabilities, which must be met some day or other. Since we have had the administration of uftairs, we have energetically lalK>red to carry out the promises we made to piit the finances of the province in gtM*l onler, and, on this head, we think we can safely assert that our ettV>rts have not l>een without success. It is our sincere desire and aim to promote the progivss and prosjterity of the country, but, single-handec, the Government are powerless to carrj- to a successful issue a policy representing its real sentiments. Tliey must have the concurrence of all men of gf»otl will and the moral support of all who desiix" the general welfare and prosperity. With this concurwuee and .