r FINANCES OF THE PROVINCE. REPLY TO THE TREASURERS BUDGET SPEECH BY MR. DESJARPINS, M.P.P. for Montmorency,, FINANCES OF THE PROVINCE. REPLY TO THE TREASURER'S BUDGET SPEECH BY MR. DESJARDINS, M. P. P. for Montmorency. Oil the iilst of Fehrwarij, 1890. Speaking in reply to the Treasurer's budget speech on the 'ilst February, Mr. Desjardins, M. P. P. for Montmorency, i aid : — The exposition and defence of the finan- cial policy of the Government just made by the hon. Treasurer is far from satisfactory. He began by promising us a statement as complete and clear as possible of the situ- ation of afTairs in the province. He has not succeeded in that task, and if the House had to depend solely on the hon. Treasurer's explanations, it would be at a loss as to the real results of the administration. The speech of the hon. Treasurer provokes criiicism on almost every point. In the first place, TUK KUKl'LUK CLAIMKO for the last fiscal year, 1888-8'J, is only imaginary. It will sullice to give a mo- ment's examination to the public accounts of that period to ascertain that the finan- cial operations of the year closed with a considerable deficit. The hon. Treasurer has informed us with an expression of lively satisfaction that his forecast of receipts had been greatly exceeded. In 1888 he foresaw that the ordinary receipts would be $3,345,- G7'2. Thev turned out to be $3,627,932. Does he suppose that we do not understand the causes to which that augmentation is due. During the session of 1888 the honor- able Treasurer knew that the expenses of the year |1 888-89 would be considerably larger than the amount on which he had calculated. He knew that with the existing sources of revenue he would arrive at the end of the year with an enormous deficit, and to make up for the deficiency i; his ex- chequer he increased the. license tax 25 per per cent. This expedient gave him a hun- dred thousand dollars additional revenue. But this godsend was still far from sufficing. It was necessary to have more money, and the (ioverniuent thought the easiest way to attain that end was to sell a certain area of new timber limits. That is what the honorable Treasurer accordingly did in the fall of 1888, and the sale brought him $118,253. The 25 per cent, additional on the license tax and the sale of timber represent, it may be seen, the greater part of the increased receipts on which the hon. Tro isurer felicitates himself. It is always easy for a government to aug- ment its revenue by such means as these. When ho came to speak on the SUIUKCT OF KXl'IONOlTUllK, the hon. Treasurer was more timid. On this head also his forecasts were greatly ex- ceeded. Ju 1888 he told us that the ex- penses of 1888 -SO would be $3,277,359.74. To-day he has been obliged to admit that the expenses of this year have reached an amount of $3,513,G18.(]4. In other words, they have surpassed his forecast by $226,- 258 — a sum relatively enormous. The House must recognize that it can only ac- cept the provisions of the hon. Treasurer after it has taken stock. THE DKKICIT OP 1888-89 The operations of last year do not show a surplus of $81,565 as the hon. Treasurer pre- tends. He arrives at that result only by carrying to capital account the sum of $236,- 996 for expenses, which should in reality be set down to revenue. On the other hand, he makes out a revenue of $3,627,932 by counting as ordinary receipts the $118,253 realized by the sale of new timber lands. I have already stated my opinion on this 1 point. The extent of our forests thus uti- lized should be deterimned by the needs of the Iiiiubcr trade, not by those of tlio provin- cial trcttstiry. 1 cannot iipinovo of the polii;y of the (Joviirnmeut in Koilinj; nuw tinibor limitH whcnevor its liuiincittl oponitionH show ii deficit. By tiioHo repented naloH, for Hucti reaHonH and in Kuch circumHtimccH, tb(; (iovernment is employing the (fipital of the province to pay its ordinary ex- penses. When dcdnction is wade of that item of $11 8, 'if):!, which under the cir- cumstances may bo legitimately sot down to the head of extraordinary receipts, the rej^u- lar sources of the ordinary revenue of the province would have produced only $:;,r><''J,- 670. I have already pointed out that, in or- der to* make an apparent surplus where there is really a deficit the hon. Treasurer has had KKCOUUHK TO TlIK TOO KA8V PLAN of carrying to capital account expjnees that should be considered as ordinary, under the pretext that they are special expenses. On this question of special expenses I maintain what I said last year, which was to this effect : — "As long as they were in Opposition, the hon. Treasurer and his politica'. friends would never allow extraordinary expenties to have a place in the budget. I have myself protested against this method of calculation. If, in- stead of quoting from my former speeches and trying to give ihcra a meaning that does not pertain to them, the hon. Treasurer had at- tentively read my comments, he would have learned that since 1H8;5 I have invariably contended that the extraordinary budget ex- penses ot the province of Quebec should con- sist of sums paid as subsidies to railways, for the construction of nublie buildings of a costly character, and the' property of the province, such as the legislative and departmental buildings, the Court house of (iuebec, the Jacques Cartier Normal school of JMontreal. By the extraordinary budget I always under- stood expenses to beset down to capital ac- count, to use the terms employed in the Fed- eral finances. •'In our financial administration the other expenses should be comprised in tlie ordinary budget, or, as I would say, should be set down to revenue. In 188H, and since then, I point- ed out that in the ordinary budget, besides the regular annual expenses of the pul)lic service, were to be reckoned certain sj)ecial expenses, which would Increase the amount, it is true, but which would not be incurred every year. I never pretended that those special expenses should not be paid by the ordinary revenue. I defy the hon. Treasurer to clie a line of my speeches on financial questions in which I maintained that special expenses were to be set down to capital like extraordinary ex- penses. " It Is easy to conclude from wh.'it I have Just said that, in the distinction of expenses into ordinary and extraordinary, it is neces- sary not only to have regard to the nature of the disbursements, •ut also to the ways and means by which they should be paid. •* I may sum my opinion on this point l»y say in;; thai cxIraDitlinary expeiiseN an? to be set down to capital, wlilU? oiclinary cxpcn-scs —that Is, expenses lor llic public service— as well as special cxpenseB, are to be kcI, down lo revtnuc. That Is my way of looking at the subjet;!, and It has never siiiied lioni the Hist day that 1 dlscusseii the allairs of the prov- inc'j In Ibis House." Such is the financial policy on this ipies- tion of special expenses which the Opposi- tion formulates^in contradistinction to that of the Ministry. It is my duty, then, lo show the results of TlIK FINANCIAI, Ol'KliATIO.NS OK 1888-81) on the principles Just enumerated. I would ask the hon. Treasurer, who woidd separate from the ordinary expenditure all the (jx- penses that he is pleased totcmsider Special, why he has reckoned all the special expenses among the ordinary expenses for the years when his predecessors were in olHce, in table B, which he has annexc^d to the Tub- lie accounts. He surely cannot thus cm- ploy two systems of weight and measure. Hero is the result of the operations of 1888-89 : Amount of expenses admitted by the Treasurer §:{,64;j,U18 Add special expcmses which tlie Hon. Treasurer has carried to capital account, but which should really be .set down to revenue 2;!G, !»!)(} Real amount of expenses .'i;3,7S0,(>15 Ileceipts. including those for the Bale of timber lauds H,G27.!);!'.3 Deficit ,?152,os:i I have set down $n,780,G15 as the amount of the expenditure, but I am convinced that this figure, extraordinary as it is, does not represent all the disbursements of the year. MUDni.lNf! TTIK DKCOKD. The Government has conducted its. busi- ness in such a manner that the payment of considerable expenditu'-e incurred last year has been placed under the current year. Last session the Ministry asked the House to vote it $30,000 for the registration of Crown lands, $45,000 for surveying, and $86,000 for the general expenses of the same department. These credits were voted for the entire year 1880-90. The chamber will learn with surprise that on the .Slst of De- cember, 1889, they were altogether exhaust- ed. It is evident that those cred- its were' absorbed in the six first months of the fiscal year, for the Government must have employed a great part of them in the payment of expenses really incurred during the year preceding. 6 forecast of the expenees to $3,552,000. By again carrying to capital account more than $225,000 that ought really to he set down to revenue. Here is the amount which, hy the budget submitted to this House and by the special mandate that it issued, the Govern- ment authorised to be expended : (ienernl budget of 1880-00.... .... $8,363,170 Add special expenseN to be set to revenue account 160,593 Supplementary budget, expenses to bo set down to i-evenue 233,693 Special orders, for the codllleatlon of laws and public works 46,676 Total $3,784,406 But that is not all. The interest account alono will be fifty thousand dollars above the sum mentioned in the budget. We may calculate with confidence that the expenses ot the current year will. In round figures, at- tain a total of $3,900,000. According to the hon. Treasurer himself the revenue for the year will not surpass $3,700,000, so that there will be a deficit of at least $200,000 for the current year. In taking the hon. Trea- surer's own figures, given in his statement of receipts and disbursements for the first six months of the year, we learn that the situation on the 31st of December, 1889, was far from being assuring. For the six first months of the year The expenses were $2,069,41 .'> The receipts 1,603,106 LcuvlDC a deficit of $ 400,248 But to this must be added expenses imputable to the revenue 118,407 Which m.akes the real deficit .... $ 584.745 The hon. Treasurer deceives himself if he thinks he can restore the equilibrium in the second half of the year. A comparison. of the amount received from Crown lands during the first half of the current year with the amount received from the same source during the same period of 1888-89 brings to light the extraordinary decrease of $242,000. There is, on the other hand, for the same period, an increase of $100,000 for the expenses ef the department and interest- Surely these are KACTH OK QUAVE IMl'OUT. I have proved that it is certain that the ex- penses of 1889-()() will be in round figures $3,900,000. Let us again compare this state of things with that which prevailed in 1885-8G, the last year in which the preceding admin- istration had entire responsibility : — Ex penses of 1 8S9-0 ') $;!,900,000 Kxponsesof 1 885-86 2.0:J2,000 Increase $ 868,000 The credit voted for public works during current year was $95,900. On the 31st of December, $91,822 had been'.already expend- ed. It is again evident that a good share of this credit was applied to the payment of expenses incurred in 1888-89. From this I conclude that, without the extraordinary re- ceipts of $118,253 for the sale of timber limits, and if the (rovernment had paid in 1888-89 all the expenses incurred in that year, there would have been a discrepancy of at least $350,000 between the receipts and expenses of the present fiscal year. TlIK AUCiMKNTATlON OK EXI'KNSKS. Driven to the wall and incapable of fur- ther denial, the Government is forced to admit that it has greatly increased its expen- diture. It endeavors to diminish the amount but it is compelled nevertheless to make a significant admission. The hon. '."reasurer tells us that the expenses of 1888-89 were $3,543,018. Let us compare this amount with that of the expenses of 1885-8G under the preceding administration : — Expenses Of 1888-80, as admitted by the hon. Treasurer $3,543,618 Expenses of 1885-86 3,032, C»7 Admitted increase $ 511,011 After making so many denials, the Gov- ernment is now obliged to admit it has aug- mented the expenses by more than half a million dollars. Nevertheless, the amount of the increase is really much more consid- erable. I have just shown that the amount of the expenses of 1888-89 really to be set down to revenue account is $3,780,(;i5. Let us once more maki' a comparison : Keal expenses of 18,<8-89 $3,780, (i 15 Expen.ses of 1 885-80 3,032,607 Augmentation $718,008 Thus, in its second year of power the present Government is responsible for the extraordinary increase in the expenses of nearly three quarters of a million of dollars. Tiiio VKAU 1889-90. The hon. Treasurer has to-day revised his forecasts of last year as to the probable re- sults of the financial operations of the cur- rent year, 1889-90. The revised ligures differ materially from the original ones. lie told us, for instance, with assuraaee lastyear, that the expenses would be $3, 35:!. 170. To-day he declares that the expenses of the current year will amount to ii53, 552,000. This would make in rourid figures an increase of $200,- 000 on his fon^cast of last session, liut how does the hon. Treasurer come to limit his 6 ThuB, for the current flBcal year the Govern- ment will be responHible for the enormous augmentation of expenditure of at least eight hundred and Rixty-eiuht thousand dol- lars. Have we not ample reason to accuse the Qovernmeni of extravagance ? TIIK VKAU 1800.91. Have we reason to hope that the Govern- ment will put un end to its lavish expendi- tures and begin seriously to practise econ- omy ? Unhappily, no ! The hou. Treasurer calculates the expenses of the next fiscal year. 18'J0-9I,at ,|;:{,42r), 045. But again he only succeeds in limiting his forecast to this figure by carrying to (.apital nearly three hundred thousand dollars of expenses really belonging to revenue. This far too easy method permits him to Hatter himself into the expectation that he will have a surplus next year. Let us calculate once more, ac- cording to the principle already laid down, of considering as ordinary expenses all those that are really attributable to revenue: Total cost of I'xpeiiscH for 185)0-1)1, udraitti'd by \\w lioii. Treasurer. .'S;i,4'-'5,(;45 Add epeeial expciiHcs to be set to revenue account, ,., 2H;t,l»70 Total !ji.'i,70i),0'Jl But the experience of the Government once it has been in jtower warns us that the fore- casts of the lion. Treasurer are always ex- ceeded by two or three hundred thousand dollars to meet the expenses on capital ac- count that it induces the House to vote, and to piiy the interest on the debentures for the railway companies which it has guaranteed, the Government will certainly have to bor- row a considerable amount between now and theendof June, 181)1. The account of the interest of the debt will be at least iifty thousand dollars more than the sum men- tioned in the budget for that purpose. Judg- ing from the way in which the Government is administering the affairs of the province, it may be calculated, unhappily with too much certainty, that the expenses of next year will exceed $:'.,y.'jO,000. The increase of the expenses over those of the former ad- ministration will, in round figures, be not less than $900,000. THIO TOTAI, AUGMENTATION OF EXPENSE.S. If we judge the entire financial operations of the Government for the four years of which it is and will be responsible, we may calculate a total increase in the expenses of more than three million dollars. Let us first add the increase admitted by the bon. Treasurer. The Government is at this mo- ment obliged to acknowledge that, com- pared with the expenditure of 1885-8G, the expenses of the years 1887-88— 1890-91 in- clusive — show a toial increase of $l,75(5,,'{3a. Here is the statement ; 1HH7-H8 $ :«:»'-•. ;!'J5 1 HHH-81) 51 1 ,0 U lHH9-!)0 r.H).!)58 iHOO-m :»oa,o:«8 Total . $l,7B0.it3a Thus, according'lo its own avowal, this Gov- ernment, whicli had promised the strictest economy, has administered atVairs with reck- less disregard to economy. When we find ourselves face to face with results so extra- ordinary, it is our duty to criticize with se- verity the extravagant financial policy of the present ministry. It is our duty to let the province know that our rulers are lead- ing it to clear disaster. « A .lUST COMI'.MliaON. The hon. Treasurer has made vain at- tempts to justify tlie Government for having increased the expenses at so extraordinary a rate. To his fruitless comparisons I op- pose a comparison between the amount of the expenses for tw) series of four succes- sive years. Here, in the first place, are the expenses for four fiscal years from July 1, 1882, to June :^0, 188G :— ' 1882-81! $ a,00tl,!)4:i 188S-84 :!,l24.(n9 1884-85 y ,s);ni,7:t;j 1 885-80 :!,o:r2,ti07 Total $lli,l<.)0,<.)04 Here, on the contrary, are the expenses, acf^ording to my calculations, for four years from July 1, 1887, to June .10, 1891 :— 1 887-88 .>? :!,552,8'20 1S88-81) ;f,78(».(il.'; 1 88i)-!)0 :!,Heo,ooo 1 8!)0-!) 1 .S.!)50,000 Total .$16,1 8;! ,415 The result of the comparison is as fol- lows : — Expenses of four years by the present Libei'ul Government, from .luly 1, 1887, to June 30, 1801 $15,18:5.415 Expenses of four years by tlie Con- servative Qovernraents from July 1.1882, to June :50, 1880. ...$12,190,904 Increase $ 2.99;i,61 1 In comparing the expenses of these two series of four years, we again learn that the present Government will have increased the expenses by nearly three million dollars — a fact which, undoubtedly , shows an alarming state of the finances. THE PHOVINCIAL llKHT. The Qovernment han not only increaged the expeuHea in an tixtraordinary manner, hut it haa alAQ augmented the deht hy Hevera! niillionH. On its arrival in power, the hon. Treasurer caiiHed a Htatement to be prepared of the consolidated and HoutinK del)t. He reckoned up all the admitted uhligationB and fixed the amount at $22,113,447 at the the date of the change of ministry, January 3!, 1H87. To-day the hon. Treasurer declares that on the 30th of June last the total debt was $27,157,808. The ditVerence may be « thus tabulated : — llebt, June :iO, 18K!i $'-'7,157,808 Debt, January ;a, 1887 •2'J,l4r.,447 Increase $ 5,oi4.:i0l The present Government is, therefons, re- sponsible for an increase in the debt of $5,014,307, in only two years and live months of power. 1 t.\i)ected that the lion. Treasurer would give UK a statement of tht; debt as it stood on the 3lHt of Decemlier, 188!> ; but he lias not done so. THK riAII.WAY DRI'OaiTS. He has preferred to stop short at June 30, 18H!i. I can eahily understand why he chose that course. In iilculating the debt up to June 30, 188!>, he vna able to set against the assets of the same date, composed ot the amount of the deposits of three railway companies to guarantee interest of their de- bentures negotiated in the European money market. Hy this means he was able to make the debt appear less considerable. He would not hav(* had the same advantage liad he given a statement to the end of the calendar year, because during the six inter- vening months more tnan a million and a half dollars of the balance of June 30 had been disbftrsed, and the balance at his disposal was reduced to less than seven hun- dred thousand dollars. But although the hon. Treasurer has not chosen to make it known to us, I can easily, with the data and documents in our possession, establish with approximate correctness the amount of our obligation on the 31st of December, adding thereto the new obligations chargeable to capital which the Ministry demands of the House in the supplementary budget for the current year, and in the general budget for next /ear. The following were the figures under this head :— ConHolldatod debt, December :u, IHHO $ai.4HO,Vl3H Temporary loans and doposltB. ... U.'J7:i,lBri Kalhvay MUbsldles 2,4521, ;U1 Hhareof the I'lotestanl minority In the JesullH' Rslates settlr- nient O'J.OOO Add tlie balance of special ex- peuNi^H which the Clovernmeul carries to capital account for 188il-«0 180,003 Expenses which the Oovernnient carries to the account of capital lor 1 8ito-01 «1 a.ooo tiuebec Court house bonds 200,000 Total , $27,r)2B.2:!7 Amount of debt as calculated by the hon. Treasurer on the|aece.s- slon of the present CJovernment to power January HI, 1887 $2'.',14:i,417 Increase .').;itH,7l>0 It is therefore iieyond dispute that the pre- sent Government has augmented the debtpf the province, since it has been in power, by nearly live millions and a half of dollars, and this in tlogrant violation of its solemn l)romise8 to the electors that nothing would be added to obligations which, in the opin- ion of the Liberals, were already too heavy. TIIK KI.OATINCI HKHT. That part of the provincial ooligations as to wliich the members ot the Government and their friends tised to aflect the greatest alarm was the floating debt. Their lament- ations on this suoject may be called to mind. On arriving at powtir, the new Ministry told us that it was abov(! all things essential to consolidate the Hoating debt, that without that operation the ore,000 in the hands of the Uovernment to guarantee the interest for ten years of several million dol- lars of debentures which they have nego- tiated on the money market. The Govern- ment undertook to pay the interest of the debentures in place of the companies. The annual amount that the Uovernment will have thus to pay is $273,000. The Uovernment has, therefore, contracted to pay $2,730,000 in ten years. The difference between the amount of the deposits and that of the interest to be paid is $500,000. If the Ministry had invested the $2,22;i,00O which it has received in deposit, the compound interest would have exceeded that interest by half a million. But this is WHAT TIIK (lOVKIlNMKNT HAH DONK. At the end of February, 1889, not a cent was left of the famous loan of three millions and a half made hardly half a year before. It was without resources and in a state of financial embarrassment, due to its pro- digalities and extravagances. Money it was bound to have by some means or other, and in large amounts. But to come again to the chamber and ask authority for another loan of three or four million dollars, was a proceeding which the Ministry, with all its audacity, hesitated to attempt. It had, it is true, sul'li- cient proof of the submissivenees of its majority, which had already been so rude- ly tested, but at the same time it deemed it dangerous to insist on several millions more, after having, in 1887, declared thut it only borrowed to pay up the obligations of its predecessors. That pretext could no longer be used, and so it shrank from the perilous task. Pressed by urgent debts, th'e Govern- ment turned towards the two millions and a quarter of companies' deposits, and looked on them with an envious eye. Its decision was soon taken. Kather than risk asking the House for a fresh loan, it ass.'iiled the ihe deposits of the companies and used them to pay its debts. In this way it might be possible to postpone till after the elections the demand for a law authorizing another loan. Thus the Government has been living ever since on the deposits received to pay the interest on the debentures for which the province 9 lind nHHiimcd tho rcRpoDRibllity. On tho 31 Ht of Dc( trnlia liiHt IIhtc rotiuiiiit'd of tho twct tiiillioiiH uihI II (|iiHrtL'r «)iily tliu ru'itivuly niodcHt hiiui ul IfHH tliiin Hcvon hundred thou- buud dollarH. Am 1 nut ri^^ht in Haying that tho (iO^KIlNMKNT IIAIl MADK A KOUCKD LOAN uf luoi'o thiui a ihiliiou and a half dulhiiH, witiiout the aiithoii/ation ot thoHoiiHe? Lot . UH now HI u tuwardH what tinuncial cataH- tn pho tint Govcrnuiont iH liuirying tho pro- vhico. Tlio loan of $:i,5()(),0()() waH all spent tt' tho laHt cent more than a yea. a^o. The eight hundred thoutjand dollars and more received from the commercial corporationH, in accordance with tho judgment of the I'rivy council have also been ex- pended. Of Ontario's hundred thou- Hand and Montreal'n hundred and twenty-live thousand not a cent is left; and of the $2,221>,0()0 of the railway com- panies' deposits there remain but six bIigations, which fall duo in rapid succession, the Covernment had, on the ,'51 st of December last, only $676,955 at its disposal, deduction being mado of $12,225 of orders still un- paid at that date. Let now put them in tabular form : — Amount to bo paid up to Juno ao, 1HS)1 $2,f.!Mi,000 Less balance on hand on the lUst of December, lK8i) , .. (i7)i,n55 Leavlnga balance of debt, for which there Is no provision, of $'2,019,045 ■We have, therefore, more than two mil- lions of dollars of disbursements for which there is not a cent at the Government's dis- posal. I have no hesitation in saying that it is the imperative duty of the House bo- fore prorogation to ask the Government from what quarter it intends to procure the mepns of meeting these obligations. It is clear that the Government will IIK 0HLIGKD TO BOHItOW AGAIN. Will it obtain a 'permanent loan or a tem- porary loan of a couple of millions 'I Tem- porary loans will only put off the necessity of the permanent loans. The Government must ultimately come to this last stage. The hon. Treasurer has not deemed it ex- pedient to inform us how he was going to procure the money necessary to pay the ex- penses on capital account which ha must secure between the present and June 30, 1891. Our duty is to ask him to for that information. Notwithetanding luH silence on this point and his reticence on other points the hon. Treaeurer has told us enough to make us understand that the policy of the Ministry is to continue aug- menting the debt of the province. He has declared that, far from diminishing, the in- terest account will continue to increase. That can only mean that the (iovernroent purposes negotiating new loans, for without new loans the interest account would not go on augmenting. A (;i:nei!AIj hkvikw. Several of the details of our provincial finances having been discussed at length, I have only undertaken to examine the sub- ject in its broad outlines. Before bringing my remarks to a close, I think it Till be well to take a comprehensive view of the situa- tion, not only as I have described it on the ground of undisputable facts and calcula- tions, but also from the standpoint of that near and peril fraught future which the de- plorable policy of the present Government has prepared for us. In 188G, under tihe former administration, the province had a budget of ordinary expenditure of "some three millions. Today that budget ex- ceeds $3,780,000 —an increase of more than tlirec quarters of a million. The total ob- ligations of the funded and floating debt surpass twenty-seven million dollars, an in- crease, as J have shown, of more than live ujillious since the acctis.slon to power of the present Ministry. Wo are at j)iesent brought face to face with a lloatiiig debt of nearly six millions. Such, in brief, is the situation to-ilay. What will it bo in a not distant future, If the House and thu province allow the Government to con- tinue its foolhardy course in the way of ex- travagance ? What it will be it is not difli- cult to foresee. The Government launches forth into all sorts of enterprises, all sorts of adventures. It incurs expense in all di- rections. It provokes everywhere demands, solicitations, importunities. It takes up pro- ject after project without weghing the difli- culties, the dangers, the consequences. Even, he hon. Treasurer could not refrain from UTTKUlNfi A CHV OK ALAHM, timid, but still real, against the tendency to expect everything from the Government. What sort of financial situation must this })olicy so inconsideriite, so dangerous, pro- duce before long if it be allowed to continue without protest. Before very long the debt of the province will have surpassed thirty millions. In a few years the Ajovernment will be obliged to borrow peven or eight million dollars. The interest account will thus be raised by $300,000 a year. The an- nual expenditure will rise to four millions and a quarter and to restore equilibrum between receipts and expenditures and save the pub- lic credi, ttlie Government will require at least three quarters of a million dollars of additional revenue. In other words it will be necessary to impose three (juarter mil- lions additional taxes. Such will be the situation ere long — such is the situation that the Government is preparing for us with inexplicable blindness. The situation is far too much compromised at present. A little more of the same policy of adventure and ruin awaits us. THE COVKliNMENT MUST RETHACE ITS HTEI'H and abandon the path of extravagance and resume that of economy. There must be an end of this levity in assuming fresh obli- gations in order to stop the necessity for heavy loans, and avoid the disaster which such a course is sure to bring. THE CONVEHHION OK THE DEIiT. After the vain hopes that the Government persisted in fostering in the public mind as to its unfortunate d';l ' conversion scheme, it was not to be cxi,octed that it would avow immediately the fiasco that it was preparing. And so to cover the defeat for a while the lion. Treasurer made a few remarks on the subject He reminded us that he had been in Europe in connection with, it, accompan- ied by one of bis colleagues, lie added, but with little assurance, that he had still hopes of success. I still maintain the position that 1 took on this question. The Govern- ment itself, after long resistance, has been forced to admit that it had no right to effect a forced conversion by imposing on our creditors the payment at lat of our present obligations, or the ex- change of these obligations for new ones at a lower rate of interest. The Govern- ment had, therefore, to amend the law. There remained to the Ministry only one alternative — that of a facultative conversion. The only course that it can take in the in- terest of the province is to abandon its scheme. From the moment that it limited itself to a facultative conversion that is a conversion accomplished in conformity with the legitimate demands of our creditors, the province ceased to find any advantage in the business. The transaction, though car- II ried out under the most favorable conditions possible, would still subject the province to a considerable loss — a loss of millions, per- haps — because i is evident that our creditors will not discharge us from our obligations before they become due unless we pay them a high premium and their full market value. We should have also to pay the expenses of the operation and the big profits which those who would take charge of them in the money market would be pure to insist on. It is altogetlier desirable that in the clear interest of the province we should hear no more of this question of the conversion of the debt. WHAT TIIK I'UOVINCE WANTS. Mr. Speaker, the conclusion which is forced upon the House, from all this debate, is that we must have a financial policy dia- metrically opposite to that which the Gov- ernment has pursued since its accession to power. I would ask the House to declare distinctly that it sees with uneasiness the constant increase in the public debt and in the expenses of the province. If my hon. coilcagues who support the Ministry will judge the situation with calmness, with patriotism, with freedom fro.-i party spirit, they will agree with us of the Opposition that this increase in our debt and expenses, admitted by the Government itself, causes them serious anxiety as to the future that it is preparing for the province. If they do not say so it is because they close their eyes fo as not to see that they wish to float with the current and deny their constituencies the protection which they have a right to expect from their re- presentatives. I will ask the Houce to de- clare that in its opinion the debt ought not to be further increased and that the Govern- ment ought to do all in its power to dimin- iuish it. Surely that is a proposi- tion that ought to obtain the support of all the representatives of the people. When we sought the votes of the electors in the last elections, in spite of divergencies of opinion as to the major- ity of political questions, we were all in agreement on one important point — that of not adding to the provincial indebtedness. All the honorable members who sit in this chamber solemnly promised their electors that they would oppose the increase of the financial obligations of the province — that they would disapprove of new loans. For three years the majority have failed to keep that promise, so solemnly made. It is time, •now more than ever, that they bethink them of their promise and of its im- portance. Il the majority reject the amendment, they will thereby pro- claim, in violation of it their solemn engage- ments, that they desire the increase of the debt, that they approve of fresh loans, with- out troubling themselves as to the disas- trous consequences that must inevitably ensue. I will further propose to my honorable colleagues that they express their convic- tion that, in order to prevent the imposition of new taxes and, if possible, to diminish those already existing, the affairs of the pro- vince should be administered with the ut- most economy. As for the public debt, we agreed at the last elections in telling the people that it was necessary to govern the pro- vince with all possible economy, so as to pre- vent the imposition of new taxes and so as to Ije able at an early day to reduce those al- ready in force. That is another promise to which it behoves us to t»ke to heart. To vote against my amendment will be voting against economy and in favor of a policy of increasing expenditure, a policy that must soon lead to the imposition of new and heavy ta.xes. In the fourth place, I will propose that the expenses may he greatly diminished without injury to the efficiency of the public service and that it is tiie duty of the Gov- ernment to diminish it. Let my hon. col- leagues carefully examine the expenditure of the last three years and compare it with" that what was incurred formerly for the same services and they must conclude that it is easy to reduce the actual expenditure. Those who will not accept my amendment will vote to maintain the expenses at the enormous amount to which the Government has raised them. In the fifth and last place I will ask the chamber to declare that it is its duty to express its opinion that in continuing the policy of financial extravagance inaugurated on its accession to power, the Government com- promises the existence of our provincial in- stitutions. THEN AND NOW. Every one can recall that four years ago, the honorable Minister and his colleagues and all their candidates at the last elections said and repeated everywhere that the fin- ancial policy of the former Government tended to the foundering, in a near future, of our provincial Institutions. Nevertheless, at that time, we had a budget of ordinary ez- 12 penses of only about $Li,000,000 a year. How can thoKe wlio pretended that this budget was too heavy, that the province could not Bland it, that its goal was legis- lative union, maintain to-day that a budget, at present of $;3,7rjO,000 and ere loi.g to be $4,000,000 or more does put our provincial institutions in danger. I implore my honorable colleagues to REFLECT SKIilOVSLY ON THE SITUATION. I have not entered, Mr. Speaker, into cer- tain exaggerations on the subject of provin- cial autonomy, because I foresaw that those exaggerations would have their melancholy reaction. I have not approved, moreover, of the support which this Government, for- getting the real interests of Canada, thought proper to give on the ground of provincial autonomy, to the agitation raised by Mr. Greenway, in Manitoba, against what he called the monopoly of the Canadian Pacific Railway company. How has Mr. Green- way shown hi3 giatitude for that support ? By abolishing the separate schools and the French language as an official and par- liamentary language at Manitoba. 1 am as as faithful to the autonomy of the provinces as any one, and for that reason I reproach the Govern- ment, for having by the fatal direction which it has given to the movement of politics, compromised uur provincial institutions. The chamber cannot permit the last guar- antee of those institutions to be destroyed by ruining our finances. We are fast APPItOACHINO THE DAY OF DIUECT TAXES. When the time comys for taxini.' the jnop- erty of the farmers, the latter may well re- proach the Government witli having squan- dered the resources of the province by lavish expenditure, and prefer to keep their patri- monies intact to the saving of provincial in- stitutions, which the Government's extrava- gance had de8tro3»ed. My proposition' re- minds my honorable colleagues of their reit- erated promises to the people. They must approve it if they deem themselves bound in honor to fulfil engagements solemnly as- sumed. Duty and patriotism prescribe no other course. I move, then, that all the words aft r "that" be removed and that the following,' be inserted instead ; — •'This House is rendyto vole the subMdies to Her Aiajosty for tde needs of the public service, but it sees with uneasiness the ron- stant and extraordinary augmentation of the public debt and of the expenses of the prov- inces ; " This House is also of opinion that, with the object of prevenling the Imposition of new taxes, and also of diminishing those already existing, public affairs should be ad- ministered with the utmost economy ; " That the expenditure may be greatly diminished without injuring the ctflcaoy of the public service, and that it is the duty of the Government to make that reduction : " This House considers It Its duty to express the opinion that in continuing the policy of financial extravagance which it inaugurated on Its accession to power, the Government compromises the existence ol our provincial institutions." Mr. Desjardins took his seat amid pro- longed applause.