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Tous les autres exemplaires originaux sont filmAs en commenpant par la premiere page qui comporte une empreinte d'impression ou d'illustration et en terminant par la dernlAre page qui comporte une teile empreinte. Un des symboles suivants apparaUra sur la dernlAre image de cheque microfiche, seion ie cas: ie symbols —m- signifie "A SUIVRE ", ie symbols ▼ signifie "FIN". Les cartes, planches, tableaux, etc., peuvent Atre flimAs A des taux de reduction diffArents. Lorsque le document est trop grand pour Atre reproduit en un seul ciichA, 11 est filmA A partir de Tangle supArieur gauche, de gauche A droits, et de heut en bas, en prenant le nombre d'images nAcessaire. Les diagrammes suivants lilustrent la mAthode. 1 2 3 1 2 3 4 5 6 BUDGET SPEECH K" DELIVERED BY HON. JOSEPH SHEH YN, TREASURER OF THE PROVINCE, IN THE LEGISLATIVE ASSEMBLY OF QUEBEC, OX THE 14tli JUNE, 18SS. '» ' • » »'. I * > • • * .'...;;:: :;:{»''{ QUEBEC, f • ;■ • .^ • - • • •• • • • * • ■'•■•!••; • • • • « • • * ■ • • ■ ■ * - • f^f'F UA^ T^ ft BUDGET SPEECH DELIVERED BY HONORABLE JOSEPH SHEHYN, TREA.SURER OF THE PROVINCE, IN THE LEGISLATIVE ASSEMBLY OP QUEBEC, ON THK 14th JUNE, 1888. i Mr. Speakeh. — I ho])e the House will kindly permit me to offer the explan- ations usual on such occasions. ■ . The voting of the supplies is equivalent to a vote of confidence in the tJovernnient ; consequently, before asking that vote, it is our duty to furnish to those, who are called upon to give it, the needful information to enable them to decide intelligently whether our administration is deserving or not of their approval. We promised to labor with energy at the work of bringing the finances of the Province into good order and, befure submitting the budget, it devolves upon me to show that we have kejit that promise. Of course, it was impossible for us, within the brief space of the fifteen months elapsed since our advent to power, to have carried out our entire j)rogranime ; but we have labored resolutely at the work of repair, and the facts, which I am about to lay before you, will prove, I trust, that we have accomplished most of our task. In fact, Nve have already restored the financial position of the l*i'ovince to a basis, which warrants a less apprehensive contemplation of the future, and, if our policy does not meet with too much opposition, we shall soon have coTipleted the woi'k of regeneration which we have undertaken. 1>60(M'> But let us examine the fticts which bear out this assertiou. To render the statement I am about to make easier of comprehension, I shall at once indicate the order which I jiropose to follow : 1. Kemarks on the fiscal year, 188G-87 ; 2. Assets and liabilities of the Province on the 30th June, 1887 3. Conversion of the floating debt ; 4. Fiscal year 1887-88 ; 5. Keceipts and expenses of the fiscal year 1888-89 ; G. General remarks on what has been done to re-establish the equilibriurai in the finances. I shall now endeaver to give the fullest possible information on each of these heads. Remarks on the Fiscal Year 1887- SS. By referring to the public accounts for the fiscal year ended on the 30th; June, 1887, it will be seen that my predecessor began that >ear with a balance on hand of SI, 034,703.49. When we took charge on the 31st January, there remain- ed in bank only a few thousand dollai-s ; but there was a consideralde amount of debts pressing for payment. All the receipts for the seven months elapsed since the 1st July, namely, 82,093,213.91, had been spent, together with all the balance on hand at the commencement of those seven months, namely, $1,034,703.49, or,. in other words, there had been expended in all 83,127,917.40. Against the 819,240.49 in bank and which constituted all the money avuil- able for the requirements of the public service, there were due claims in the Treasury office to the amount of 871,400.98, leaving an actual shortage of 852,160.44. The outlook for the three months ending on the 1st May Mas hardly more encouraging. According to the calculations of the Assistant Treasurer, the opera- tions of those three months would leave a shortage of 8638,369.44, that is to say, that the payments would amount to 81,049,459.43, while the receipts would only come up to 8411,090.49, I thus found myself confronted with an empty chest and a heavy amount of pressing liabilities. The requirements of the puldic service largely exceeded the receipts upon which we could rely, so tliat, all well considered, there remained no other alternative but a loan to meet the engagements of the Province. I ge of more I opera- jto say, Id only lunt of led the Ined no Before resortinj; to this expedient, I deemed it advisa'de to ascertain the obligations to be covered and, for this purjHJse, I had sUitements prepared hy the Assistant Treasurer, showing the insutticiency of the credits voted at the instance of my predecessor and the balance of receipts remaining to come in. Tljese statements, or the greater part of them at least, are reproduced in the- printed tabU'8 just distributed to honorable members, who will find in them the proof or rather the corroboration of all I have stated. The honorable mem1)er for Sherbrooke, in his budget speech of the 7th May, 1886, estimated the receipts of that fiscal year at $3,093,022.80, and the payments at 83,483,239.55. For the first seven months, namely, from the 1st July, 1886, to the 1st February, 1887, the receipts amounted to 82,093,213.91 and the payments to $2,705,400.94, so that, acconling to liis estimate, there remained on the 1st February 81,080,634.11 to come in and only 8777,892.61 to pay out during the last five months of that fiscal year. But he was mistaken in his calculations ; as the result of a careful examination of all that remained to be collected and to l»e paid, the Assistant Treasurer furnished me with a statement showing that the receipts of the five months in question would not exceed $952,989.11 and that the payments for the same period would attain the figure of 82,073,768.23. Theie revised estimates placed the receipts of the whole year at 82.965,977.80 and the payments at 34,779,169.17. The real operations, as detailed in the public accounts, were as follows : Receipts of the Fiscal Year 1886-87 Dominion of Canada $1,261,872.80 Crown Lands 692,620.48 Licenses 342,215.48 Administration of Justice j 202,042.58 Percentage on the fees of piibhcs officers 11,596.39 Legislation 7,604.95 OjSicial Gazette 24,087.27 Asylums — contributions from munici]jalities and patients.. 8,372.49 Public Buildings 3,529.18 Casual Revenue 1,392.50 C!ivil service pension fund 5,237.93 Interest on deposits in banks 32,787.23 Interest on the price of sale of the Q. M. O. & O. llailway 368,975.60 Contribution to expenses of inspection of insurance compa- nies 534.84 Industrial Schools 3.80 Premium, discount and exchange 67.06 Refunds 2,506.04 Total of ordinary receipts $2,965,446.62 6 Trusts : — Marriage license fuml, Sfi,084,00 ; teachers* pension fund, Soo.Onc.SO, Catholic superior eihmition fund, 3273.2'), Security deposits by public officers, 88,500.00 870,814.05 Repayment of advances 7,025,00 Insurance on old Parliament Buildings 32,705.00 Quebec Fire Loan 120.00 Municipal Loan Fund 5,380.00 Temporary loans 600,000.00 716,704,05 Total receipts from all sources 83,082,150.67 Payments of tlie Fiscal Year 1886-87 Public Debt 81,016,023.14 Legislation 278,169.07 Civil Government 193,904,06- Administration of Justice, including police, reformatories, industrial schools and inspection of public offices 497,369.23 Publiclnstruction 35o,295.00' Literary and scientific institutions 24,106.79 Arts and manufactures , 11,500.00 Agriculture 89,476.22 Immigration 8,000,00 Colonization 155,000.00 Public Works and Building imputable to revenue 94,575,94 Lunatic Asylums 243.000,00 Benevolent institutions 39,316,00 Miscellaneous 17,459,25- Agent in France 2,500.00 Aid to distressed fishermen of the North Shore of the St- Lawrence 9,500.00 Royal Commission re the Q. M, 0, & O, Railway 12,000,46 Deschamp — List of imrifihea and municipalities 7,600.00' Macadamizing the road of St, Barthelemi, county of Berthier, 2,000,00 Wharf, revetment wall and dike at St, Justin, County of Maskinonge 1,600,00 Crown Lands Department 154.111,00 Ojfficial Gazette 14,500,00- Stamps, licenses, &c 9,319,5ft- rensiniis imi«l 14,l;?3.79 Miiniciiuil Ltian Fuiul L'lO.OO Lix'uses, aiiiouut jtaitl by luveime ofticers out of collections. 20,.Jli).46 liuildiiig auil Jmy Fuiul, nmoiint \m<\ by .Sheiifls out of collections ' S,229.16 Teaclier's jtension fund, 43. 44 Vic, chap. 22, and 40, TiO, Vic, clmp. 27 t;,000.0O g. M. O. & O. Eailway, traffic expenses :i,:i74.0O Inspection of Railways OOO.OO Total ordinary expenses ?;i,2SO,tJ07.78 TriLsts : — Marriage license fund, II. Catholic Superior educsjtion fund 8 18,:»10.73 New Parliament IJuildings, construction 184,2I>8.00 New Court House, Quebec, construction 11*3,212.42 Montreal Court House extension., 18,000.00 Q. M. O. & (). railway, construction 8,000.00 Subsidies to railway conijianies 73(5,890.70 Hon. Tlionias McGreevy, account in suspense 100,000.00 Repayment of tempomry loans 250,000.00 1, "08,917.85 Total payments of all kinds HT9S,G15.G3 The ordinary operations may be summed up as follows : Onlinary expenses ?3,289,G07.78 " receipts 2,965,440.02 Deficit 8 324,251.10 00.00 11.00 00.00- 19.56- In this resume of the receipts .ind exjjenses, the classification differs slightly from that in the jiublic accounts. Thus I enter among the receipts on capital account the S7,625.00 repaid on certain advances, which are given as ordinary receipts in the public accounts. I also include among the onlinary exj enses the 8900 paid for inspection of railways and which are put down as a payment on capital account in the public accounts. The total of the receipts and exi)enses, as indicated by the public account, is as follows : # T..U1 iMiyuu'iits S4,708,filo.G:i Totiil iL'ceipts a,G82,l.'O.U7 Kxcesa of payments e struck olV, siuh i.s tliosc whieh arj only of a temiK>rary uature and Mhich have to Ixs refunded or ure lield in trust. For instance, we repaid 82.j0,000 on the temporary loniis aiil .'<18,.'»10.7.'5 on trust funds, besides settlin*,' the- $100,000 chiiai of tlie Jacijues Cartier IJaniv. Now, it is evident that these $308,510.73 should he stiiiek from the a<,'j,'regate of the payments, thus reducing the latter to $4,4:!0,1 (14.1(0. On the other hand, the $70,814.05 received on account of trust fun Is, the St)00,000 of temporary loans and the $32,765 coming from the insurance of the old Parliament House, should be deducted from the total of the receipts, which would reduce the figure of the ordinary receipts to $2,978,571.62. Then, we would get the following result : — Total pajmems $4,430,104.90 Total receipts 2,978.571.02 Real excess $1,451,533.28 This sum forms pai*t of the liabilities, which were to be paid off out of the proceeds of the loan, and which M-ere recorded as such in my last budget spech. This sum is less than I stated onthestrength of the revised estimates furnished by the Treasury officers ; but it is explained by the fact that certain items of the expenditure did not come up to the figure of their estimates, chiefly as regards the payments on account of subsidies to railway couipanies. We calculated on having to pay out Tinder this head $486,000 and we only had to pay $114,431.80 or $371,568.20 less, which makes a proportionate diminution in the total of the payments. This diminution must be in great part attributed to the uncertainty in which the railway companies found themselves placed. As our predecessors had left us DO money, these subsidies could only be paid by borrowing, and as the Opposition made so many efforts to prevent the loan we proposed, the railway companies, fearing the success of these efforts, suspended their works and had only time enough after the session and before the 30th June to earn but very little of their subsidies. I tlierefctre preteiul that, after takiiij^ out the purely accidentwl oitcnitioiiH, it •>vill lie uecusiMirily fountl that the onliiiary uxi*eii8C'9 exceeded by 181,451, r»3;i.28 the figure of the ordinary receipts. This result diil'ers materially from the one antiuijmted. Iiy tiie hoiiorahlu member for Slierbrooke. Instead of 83.093,622.80 the sum upon which he •counted, the receipts only amounted to ^'2,[)iJo,'>66.6'2, nmkinir a diminution of 8128,056.18. Tlio exiHjnses, which he estimated at 83,483,293.55, ran up to 84,798,615.63 or an increase of 81,315,322.08. On the 31st January, he had flpent 8416,397.72 beyond his estimates ; now, if you add to this the shortage foreseen by him between the receipts and RXijeu-ses, namely, 8389,670.75, and the 8128,056.18 less in the receipts, you will ^ ' a total of 8934,124.65. The tlifference Itetween these two sums is 8517.4U", which is the amount actually e-xpended beyond my predecessor's estimates. This amount forms part of the supplementary credits, whic'i we got vot ! iast session ^ supply the insulliciency of his budget, (as established by the stiitements oi the otticers of the l)ei«irtment) wliijii was far below the rea^ requirements of lie pultlic service. Tliese explanations and the tables just dis'ilbuted will sutHce to establish the correctness of the result I have noted. In any case, whatever may be the excess of the exjtenses over tlie receipts, it is well to remember that we are in no sense responsible for it and that we simply paid the expenses incuiTed or the debts coutiacted l)y our jiredecessora. I lay stress on this point, in order that the resposibility may rest upon the shoulders of those to whom it rightly belongs, and that we may exonerate ourselves from the dishonest and disloyal charges which certain of our adversaries would not fail to formulate against us, if we did not place this question of| responsibility beyond dispute. The receipts have exceeded the figure of my estimates and the expenses are less. To establish this point clearly and to show the difference between the anticipated deficit and the one indicated by the public accounts, I have had a statement prepared indicating the difference in each item and in the aggregate of the operations, and another statement showing the ordinary and €xtmordinary receipts, with the actual receipts on the one side and our estimated TBceipts on the other, as well as tbe amount of the actual and the estimated expenses. But detailed and clear as are these statements, it will, perhaps, not be out of order to point out some of the principal variations which have occurred in the figures of the estimates. 10 Licenses yielded 867,215.48 more than the anticipated receipts. This excess is attributed to the increase of the price of the licenses and the increased efficiency which we imparted to the service entrusted with the enforcement of the- law and the prevention of fraud. The items of receipt which did not come up to the figure of the estimates of the hon, member for Sherbrooke were mostly foreseen in the estimates of last session. We collected none of the 830,000 entered as interest on the common school fund, as we were unable to give attention to this question until after the session and to prosecute energetically the negotiations with the Ontario Govern- ment, who refused to pay so long as there was no understanding come to between the two Governments. I need say nothing relative to the differences in the figure of the expenses,, as those which occun-ed were anticipated in the supplementiary estimates sub- mitted last session and intended to supply the insufficiency of the credits asked by my predecessor. - ■ ■ ... I trust that these explanations and the printed tables distributed to honorable members will satisfy them that I have given them all the information it is possible to give. II. Assets and Liabilities on tiie 30tli June, 1SS7. According to the official reports supplied by the different departments, the liabilities and assets of the Province stood as follows at the close of the last fiscal year :— . LIABILITIES. Funded Debt outstanding 8 18,117,233.33. Temporary Loans and Deposits Outstanding Warmnts at 31st January, 1887 Railway money subsidies authorized, but not yet earned Railway land subsidies converted into money suljsidies under 49-59 Vic, Cap 77, and authorized by order in council prior to the 31st January, 1887, 3,800,500 acres at 70 cts. per acre 8 2,660,350.00 1,329,105.25 240,753.72, 530,107.25. Amount carried over 820,217,199.55 11 Amount brought forward §20,217,199.55 First 35 cts. per acre payable as the work is done S 1,:53(),175.00 Paid on account of same to 31st January, 1887. 310,»j53.30 1,019,521.70 Bailway land subsidies which may be converted into money subsidies, 1,326,000 acres at 70 cts. per acre S 908,600.00 First 35 cts. per acre payable as the work is done 4H300.00 Estimated cost of completing Parliament Build- ings 75,123.00 Contract for statues on Psirliament Buildings... 25,000.00 Estimated amount required to complete Queljcc Court House • 100,487.28 Balance of land and other debts Q. M. O. & O. Railway r.>),070.00 Loss on E.xchange Bank deposit 27,000.00 Quebec Court House Bonds 200,000.00 ii?22,188,700.08 ASSETS. Part of price of Q. M. O. & 0. Railway deposited in banks S 385,000.00 Part of price of Q. M. O. & (). Railway invested in Quebec Court House bonds 20(^000.00 Part of price, do, invested in City of QucIkjc debentures 15,000.00 Balance of price of Q. M. 0. & O. Riiilway uniKiid 7,000,000.00 S 7,600,000.00 Capitalized milway subsidies under Dominion Act. 47 Vic.,8 8 2,394,000.00 Claim against Honorable Tliomas McGreevy 100,000.00 Cash in Bunks 81,761.66 Cost of Jacques-Cartier school, Montreal, to be i-epaid from sale of property 13S!,348.02 Advances to various parties 87,771.40 Estimated amount due as interest on Common School Fund from Ontario 135,000.00 222,771.40 Amount canied over .... ^10,536,881.08. 12 Amount brought forward City of ^lontreal, subscription to Hull bridge.... do contribution towards lands expropriated between Ho- chelaga and Dalhousie square Quebec (,'ourt House Tax under 45 Vic, 26 and 48 Vic, Cap. 15 Excess of Liabilities over Assets at SOth June, 1887 8 10,536,881.08 50,000.00 72,188.02 200,000.00 S 10,859,069.10 $ 11,329,620.98 $ 22,188,700.08 Comparison between this statement and the one I submitted last session for the 31st January^ 1887, will show that there has been very little change in the various items composing the assets and liabilities of the Province and that the excess of the liabilities over the assets has remained about the same. On the 31st January, the liabilities were $22,143,447.68 and on the 30th June they were $22,188,700.Q8, which makes an increase of $45,252.40. On the other hand the assets, which were $10,754,280.24 on the 31st January, amounted to $10,859,- 069.10 on the 30th June, which makes an increase of $104,788.86 or one of $59,526.46 over the increase of the liabiUties. In other words, the excess of the liabilities over the assets was $11,389,167.11 on the 3l8t January and $11, 329,- 63'^. 98 on the 30th June, that is to say, that, in the interval between these two dates, the figure of the net debt was reduced by sixty thousand dollars. This reduction comprises the amount paid for sinking fund and the redemp- tion of a certain number of bonds of the funded debt, which last was thus reduced from $18,155,013.33 on the 31st January, 1887, to $18,127,233.33 on the 30th June, or by $27,780. On the 31st January, the floating debt amounted to $3,988,434.32 and to $4,061,466.75 on the 30th June, that is to say, that it remained nearly stationary. • During these five mouths, there was an increase in the temporary loans, but as we applied the proceeds of these loans to paying off an equal amount of the floating debt, this increase did not affect the situation as a whole. ■f 13 In the assets, there was in January a claim of $100,000 against tlie Jacques Cartier Bank. In conformity with the resolution of the House, we remitted this sura to the Bank, but it has been debited to the Hon. T. McGreevy, to whom the advance had Iteen made by the Bank, so that the result of this operation was simply to change the title of the credit. During those five months, we paid 8114,431.80 on account of 8ul)sidies to railway companies, and the subsidy of 89,800 to the railway from St. Andrew's to Lachute became lapsed ; so that this part of the floating debt was diminished to the extent of these two sums, or by 8124,431 in all. Tlie liabilities maturing during the five months comprised between the olst January and the 30th June amounted to 81,893,203.58. Of this we paid off $758,407.71, leaving still to be paid under this head on the 30th June last a balance of 81,134,795.87. To procure these 8758,407.71, we effected two tempor- ary loans of 8300,000 each and the balance of 8158,407.71 is included in the warrants outstanding at the end of the year. The total of these warrants is $240,753.27. And, if you deduct from this sum the cash on hand, namely $81,751.66, you will find a difference of 8159,001.61, which about corresponds with the figure just given as representing the warrants issued to pay off certain portions of the floating debt and remaining outstanding at the close of the last fiscal year. Of the liabilities falling due from the 31st January to the 30th June, there therefore remained, at the last mentioned date, 81,134,795.87 still to be paid. This sum was made up of the following items : — Temporary loans, etc 8729,227.67 Loss on Exchange Bank deposit 27,000.00 Balance of claims for construction Q. M. O. & 0. Railway 7,000.00 Railway subsidies 371,568.20 81,134,795.87 Since the 30th June, these railway subsidies have been paid, whe temporary loans have been repaid, and we would have reimbursed the loss on the deposit in the Exchange Bank if we could have learned from the liquidators the exact amount of that loss. The 832,765.00 derived from the insurance on the old Parliament House liave also been paid over, an arrangement having been effected by which we got riil of an unproductive property upon which we had to pay a perpetual annual ground 14 rent of §4,444.00. At 5 per cent this rent represents a capital of $88,880.00, which fiir exceeds the value of that unproductive property and the S32,765 of insuram^e. The fluating debt, therefore, on the 30th June last, amounted to 84,061,466.75 and against this debt we could only set the following realizable or available assets : Cash on hand $ 81,751.66 Property of the old Jacques Cartier Normal School 138;348.02 Loan to the North Shore Turnpike Trust 15,000.00 Loan to the Trappist Fathers 10,000.00 Loan for seed grain to certain municipalities of Charlevoix 25,646.40 Loan to proprietors of Beauport Asylum 1 0,500.00 Loan to proprietors of St. JeandeUieu Asylum 25,625.00 Montrears subscription to Hull Bridge 50,000.00 Due by Montreal for expropriations between Hochelaga and Dalhou- sieplaco 72,188.02 $430,059.00 This was the sum total of our assets on the 30th June, to pay off a floating debt of S4,(iG 1,460.75. Let me remark, too, that there are several items of the assets wliKse realization is very doubtful, which reduces at the most to $300,000 the amount upon which we can count. The situi^tion, therefore, as regards the floating debt, may be summed up as follows : — Amount of indisputable liabilities Kealizable assets 84,061,466.75 300,000,00 83,761,466.75 Strike of^" the 8200,000 for the construction of the Quebec Court House, which is represented by a permanent loan, and there remains 83,561,466.75 ; but $200,000 must be added for the enlargement of the Montreal Court House, 825,000 for aid towards the construction of iron bridges, and 810,000 for exploring surveys in certain counties, the whole as voted last session, which brings to $3,796,466.75, the figure of the floating debt on the 30th June, 1887. Hon. members will please remark that I have struck off from the assets available to meet the floating debt the sum representing the interest due on the 15 ■comiuou school fund. Tliis interest is naturally an item ofj ordinary revenue and should not Ije entered among the receipts on capital account intended to wipe out old debts. Tlie amounts due to the municipal loan fund also represent a certain asset ; but, as what we can collect of thesa is more or less uncertain, I put them against the doubtful claims which I have not included among the liabilities. Tliese claims, as I explained last session, then amounted to 84,534,497.96. We have since been compelled to settle a certain number of them, son*^ in consequence of adverse judgments and some by compromise to avoid useless costs and on more advan- tageous terms than we could liave secured if we had applied to the law courts to decide the amounts. In fine, what we shall be obliged to pay upon the residue of these claims will probably absorb more than we shall collect of the amounts remaii-ing due to the municipal loan fund. I think it right to enter into all these details m ortler to clearly define the situation. I do not wish to Ijlame any one ; but justice and equity require that I should show the situation in its true light, so that the line of demarkation may be correctly drawn Ijctweeu the resj)onsibility which falls to our share and that which should rest ujwn others. While, on this head, I may, perhaps, be permitted to call attention to a preten- i)ion, which needs only to be exposed to be refuted. Certain parties have stated and wTitten that we have increased the debt of the Province by contracting the last consolidated loan. Tliese statements are as unfair as they are absurd. What are the facts ? ' Our jjredecessors had accumulated a floating debt of nearly four millions, by the time we took office, and that debt had to be paid off". But witli what were we to pay it ? Under the administration of our predecessors, the ordinary revenues did not suffice to cover the ordinary expenses. No other recourse, therefore, was left but a loan. Hut, how were we to borrow three or four millions otherwise than by iin issue of bonds ? Where are the monetary institutions in the country that •could have lent us such a sum at a long term ? Consequently, we had to convert the floating debt, contracted by our predecessors, by borrowing abroad and that is what we did. We have not increased the debt ; we have simply changed the creditors of the Province, which has alsp enabled us to effect a reduction of one per 16 cent, in the rate of interest and to thereby realize a saving of 830,000 a year. It seetns to me that a transaction of this kind is deserving more of praise than of blame or criticism and, if one can judge by the results of the elections since last ses.sion, tlie people of the Province are of the same opinion as I am on this head. Ill Conversion of the Floating Debt. For the purpose of converting the floating debt, the Legislature passed a law last session authorizing us to effect a consolidated loan of S3,500.00 Shortly after the session, I applied myself to the negotiation of this loan. I opened communication in the first place with the Bank of Montreal and in an interview which I had with the Vice-President and manager of that institution, I made them a proposal to undertake the operation or to place tliemselves at the head of a syndicate who would be disposed to take our Ijonds ; but their answer left me under the impression that the affair did not suit them. At the date of this interview, I had already received several letters from Messrs. A. T. Drummond and Hanson P>rothers, brokers, of Alontreal, as well as. from several other parties, offering me their services in connection with the loan. Some of these gentlemen represented powerful London Vmnking house, such as Morton, Rose & Co., Panniure, Gordon & Co., all favoral)ly known in this country. Before acco})ting or even considering any of these offers, I deemed it prudent to lest the market to ascertain what we might obtain for our 4 per cents and to not bind myself towards .any person, in order to secure the benefit of competitioa for tlie Province. • ]\feanwhile, I received a call from Mr. Porteous, the manager of the Bank of Montreal, at Quebec, who informed me that that institution was ready to tiike the loan at 97 and at 4 per cent interest on the following terms : — The Cf overnment to grant twenty four hours' delay for ratification of the ofler ; The price agreed upon to be paid otip fourth on delivery of tlie bonds by draft at sixty days, another fourth thirty days after by draft at sixty days, and the balance sixty days after, also by a draft at sixty days. This offer mentioned not) ng rc..pecting the costs of emission, which represent 17 1 ofter ; y draft lid the Ireseut a considerable percentage. Taking into account the loss of interest, 1 per cent, the expenses of stamps, J per cent, and the loss on the exchange which was then from i to 1 per cent below par, this offer was ecjual to 94 J or 95 or less than the quotation of our 5 per cents on the London market. Thoroughly convinced that Ave could do better than this, I declined this ofter and had a circular, (i) prepared of which copies were sent to the I^ondon, New-York and Paris markets. Accoixling to the terms of this circular, the delay for receiving tenders was to expire on the 1st August ; but, to give greater fiicility to tenderers on the other side, I waited fifteen days before taking any of the offers received into conside- ration. I received three from private bankers, but none from banks ; not even from the Bank of Montreal or that of British North America to each of which we hiid addressed, with the circular, a letter from the department. I The offer of Hanson Brothers, was 92 at 4 per cent interest, M'ithout guarantee of the rate of exchange as stipulated for in our circular — the Govern- ment engaging to pay 1 per cent commission to the " National Provincial " Bank of England for the interest service, and the tender further stipulating that the payment of the purchase price should be made in London, in three instalments. This offer was not acceptable. 1 j.' At the same time that they sent in this tender, the same gentlemen sent in another, offering to float the loan at our risk upon commission. I did not con- aider that it would be to the advantage of the I rovince either to accept this offer. The second tender was that of Mr. A. T. Drummond. broker, of Montreal, acting on behalf of Panmure, Gordon & Co., of London. This tender was 86 i for our 3| per cents or 93 for our 4 per cents, payable in four instalments, by drafts at 60 days after sight, rate of exchange guaranteed, expenses of stamps, &c., payable by the purchasers witli the exception of a commission of V per cent payable by the Government to Mr. A. T. Drummond. This offer, like the first, was not acceptable. The third tender, which was that of Mr. James M. Nelson, of New York, offered 94 net for our bonds bearing 3 J per cent interest. The delay fixed by the circulars having expired, and, having no other offer before me, there remained nothing to be done except to choose the most advanta- geous. It was decided to accept Mr. Nelson's offer, but not to close with it until I ,(i) Sm eiroaUr at th« end. 2 18 we hid obtained satisfactory infonuation about him. This information haviUj^ proved favorable, we concluded a bar<^ain by which he undertook within sevea days to deposit as a guarantee in the Chemical National Bank of New York,, securities to the amount of three and a half millions in favor of the (lovenxment- These securities were to becoini tlu property of the Governm^it in the event of the syndicate, represented by Mr. Nelson, foiling to carry out its engagements.. This syndicate was composed of five persons, whose commercial standing was such as to place their ability to fulfill the conditions of the contract beyond all doubt.. Moreover, with the guarantees upon which we had insisted, we ran no risk in making the bargain and all the more so becjiuse the Province was in no sense bound, in the event of failure. More than this, it was our duty to accept the lowest tender, when tin; necessary precautions had been takju to protect the interests of the I'rovince. If we had acted otherwise, we would have left ourselves- open to censure, and rightfully so, for not having accepted so advantageous an offer. We would have been told: You should clearly have accepted their tender but you sliould have insisted on getting from the tenderers a guarantee of their good faith. Well, that is just what we did. With the guarantees stipulated in the contract, we ran no risk and we had, moreover, reason to believe that this- syndicate was in a jwsition to meet its engagements, because, if otherwise, what would have imhiced Mr. Nelson to incur the expense he did to give eft'ect to his. offer, if he was not serious and if he was not backed by men able to negotiate the loan ? I have personally no doubt that the engagement would have been met and the requisite deposit made on the day fixed but for an altogether accidental event. . , . ■ Before the expiration of the delay granted for the deposit of the g\jarantee of 3^ millions, and two or three days after the signing of the contract, the president of the syndicate was struck down with dangerous illness at his summer residence at Newport, 11. I., and expired a few days later. This gentleman was president of the financ3 committee of the loan department of the New-York Mutual Life Assurance Company and reputed to be worth several millions. It M-as he who had organized the syndicate, and who was its president. I have it also from a reliable source that his illness was contracted during a trip he made to New- York for the express purpose of closing the transaction which he had authorized Mr. Nelson to make. His death naturally caused delay and was also the reason why the deposit of three and a half millions agreed upon was not put up. During the illness of Mr. Ross and pending the formation of a new syndicate- a change occurred in the state of the money market. There was a rise in all securities and the condition requiring the deposit of a guarantee equal to the 19 amount of the loan was considered too onerous, and reasonably so, as it i:^ not customary to exact such conditions in these kinds of contracts. Accordin';ly, an offer was made to us to substitute for this deposit another of S10(.»,0(MJ as a, guarantee for the execution of the contract. Not wishing to miss tlw? opjtortuuity to carry through an o])eration so advantageous to the I'rovince the tJovernnient consented after a good deal of negotiation to make this concession, whieh, after all, was only an increase of precaution, and to modify the contract in tliat si-nse, while retiiining its rights under the first contract. This deposit of ?10(*,000 in cash was to have lieen made with the I'ank of Montreal in New-York and to have been placiid to the credit of the Province, to become its property in the event of the syndicate failing in its engagements. The ])roposition being accepted and the syndicate reconstructed, a delay of a few days was granted to make the dejosit in question, but, before the expiration of the delay, ilr. Frederick H. Cossitt, w ho had replaced Mr. Edmund IJoss, died suddenly, This Mr. Cossitt, who wiks uIho one of the trustees of the Mutual Life Assurance Company, was a rt'tired merchant of the highest respectability and a member of the financial committee of that institution in which he exercised great infiuence. e itee of isident lidence ient of I Life who Tom a ■York I Mr. why idicate- J in all |to the Mr. Cossitt's unexpected death was the second check to this syndicate, which, by the very fact, was thrown again into a state of disorganization. Not yet. discouraged, however, Mr. Nelson and his associates went to work to form a new syndicate, but, imfortunately, after two such l)low3, it was impossible for them to find capitalists able to carry out the contract. Summoned by the (lovernmeut to fulfill their contract oliligations or to abandon the affaii-, they sent despatch after despatch assuring us from day to day that their reorganization was certain. They were really serious and fully resolved to give up the task only after they had exhausted every possible nieaus. On the other hand, the Government, in the face of the advantageous offer of this syndicate as compared with the others then before it, did not desire in the interests to of the Province to l)reak off too abruptly negotiations begun undar such favorable auspices. Mr. Schuyler, one of the interested parties in the business, made several journeys to Montreal and Que! ec, and, on each of his visits, assured us that the contract would be carried out and that all that was needed was a delay of a day or two at the most. All this can be seen on reference to the correspondence and despatches exchanged with the syndicate, which have been laid on the Clerk's table. If we did not meet with the success we anticipated in New York, our effortfj in that direction were not without result, as they brought us into relationshi]) com- munication with bankers to whom we are indebted for very valuable information and whos^ advice was most useful to us in our operations. 20 Thus, it was through the metliuin of Messrs Heidelhach, Ickelheimer & Co., M'ealthy bsmkers, of Xew York, that we were placed in coinmuiiicatiou with the Credit Lyonnais, with its capital of 200,000,000 fraucs, one of the most solid monetary institutions of Europe and possessed of unlimited credit. We were all the more fortunate in entering into negotiations with this powerful institution that the banks of the Provi:r' • had refused to interest themselves in our aflair and that we were reliably iiuiii.. a that there was a regular organization in London to prevent us from 'i^oceding or to impose on us the most burthensome conditions. We avoided all this by transacting with the Credit Lyonnais, which, in taking charge of our loan, gave the Province tha benefit of its own high credit and raised the quotation of our bonds in the mirkets abroad. I need hardly say that it rjquired a good deal of negotiation to arrive at the advantageous bargain which we concluded. The Credit Lyonnais did not want to bid beyond the current value of our bonds, as quoted in London ; while, on our sid3, we wanted to get more and succeeded in getting it. At the date of these negotiations, our 5 per c( nts, average term, were quoted at 112 ; now, we obtained 96i for our 4 per cents, which is equivalent to 5 per cents at 113.4G or 1.46 per cjnt more than the market quotation. We also effected a saving of J per cent on tlie stamp charges and, instead of losing, we gained on thj exchange, which nukes our transaction about 2 per cent better than the current quotations. Favorable, however, as was this bargain, I did not wnsh to close with it before again addressing iMr. Druinmond with whom I had continued to correspond, assuring him that he would get the preference if he made us as good an offer as, tho Credit Lyonnais. He offered me at first 9J for 4 per cents, then, a few days afterwards, 95J, less a commission of ^ per cent ; but he withdrew this last offer on th3 pretext that his proposal did not involve a firm price, but was subject to certain chargjs which we did not want to assume. At the sam3 time, I had assured myself, through a correspondent in London whom I had instructed to make careful enquiries on the subject, as to the value of our bonds and what they were likely to bring in England, and his reply left no doubt as to the superiority of the proposal made us by the Credit Lyonnais. It was then decided to definitely accept 96^ net from the Credit Lyonnais, and I accord- ingly addressed the following note to its agents, Messrs Heidelbach, Ickelheimer & Co. : 21 " Xew-Yokk, 14th Dec, 1887. " Gentlemen As you stated in our interview of this ilay that you were not propaved to close with our offer without first writing to your correspondents on the other side tlie niiture of tliis offer and that for the purpose you re(iuired an option till Wednesday, the 27th instiint inclusive, after consultiu,:,' with the Treinier as I stated I would have to do before I could decide, we have both come to the conclusion to grant you the delay asked for, but no further. In our interview of yesterday regarding the negotiation of our Provincial loan of 83,500,000, I stated that the lowest price I would accept for a four per cent i.ssue would be 9tU net in New- York in gold currency or its equivalent. The said 90^ to be free from conunission and charges of any nature whatever. You undertaking to pay for thi.s loan in Xew-York as follows : — 1 million payable loth January, 1888. 1 " " loth February, i " " l.')th March, " .. _ 1 " " 1st April " Less 3h per cent to cover all chjirges, discount, etc. reducing the amount to- 96 J net j)ercent. " This offer was definitely accepted and embodied in a contract subject to ratification by the authorities of the Credit Lyonnais and it ^^•as to j,'et this ratifi- cation that my hon. fi-iend, the I'rinie Minister, went to London and I'aris. By this contract, the Credit Lyonnais uudcrtook to pay in American gold, at New-York, and at the dates mentioned in my letter, a stini of Sl3,o77,500.00 or 96| per cent of the nominal amount of the issue, net, and free of expenses and charges of any kind whatever, except S3.000 for the printing of the bonds, which were to bear the date of the 2ud January, 1888, with interest also to run from that date. This interest, at the rate of 4 per cent, is payable semi-annually in London or Paris and the term of the loan is forty years. The expenses which we escaped by selling firm are relatively considerable In the first place, there are the stamp charges, which, in London, have been raised from i to I per cent and, at the latter figure, are equivalent to 817,627.23 on tho amount of our loan. To this must be added the other expenses and, especially, the exchange, which form pretty a round sum. These different charges represent 3^ to 22 4 per cent, so, that hj avoiding them, we really placed (»ur loan at par. If wo had conducted the operation hy way of i>iil»lic tender, the Province would have had to 8Uj>i>ort all. the costs, which wouM certainly not have produced a better ix'sult, •witliout taking into account that we would have had to run the risk of all the Huctuations of the money market and the rates of exchange, A certain amount of importance appears to have heen attached to the fact that tlie Credit Lyonnais placed the lionds of this loan on the market at a higher price than it jiaiii us for them. This is .simjdy a stock operation which could only l»e carried on liy an institution like the Credit Lyonnais, but not by a Government. The lUnk of Montreal did the same thing with the bonds of the loan of 1882. After buying them at par from the Government, it jdaced them on the market at 107. At the time, no one thought of saying anything against this very common operation, not even the newspajjcrs which are now endeavoring to find fault with us, for the action of the Credit Lyonnais in doing the same thing witii the bonds vof the loan of 1888. Our issue, representing .^3,500,000, yielded to the Province in gold, in New York, .*3,377,r)00, or ?9G.50 per 8100. In addition, we guiued t<037 as premium on the exchange between New York and Quebec, thanks to the care we took to in effecting the transfer of the funds without exposing ourselves to the danger of the fluctuations in the rate of exchange. Deducting the discount, expenses of emission and exchange, the 4 per cent loan of 1S88 has produced 96 J. Making the same deductions as regards the other con- solidated loans of the Province, the following table may be formed, indicating also viiat those loans should have produced to have brought as much as ours, allowance b^ing always made for the rate of interest : Loan of Rate of Interest. 1874 1876 5 per cent 5 " 1878 5 « 1880 1882 (in 1882 (in 4J « Canada) 5 " London) 5 " Net Proceeds. 94.95 100.00 95.16 88.26 100.00 99.16 Amount they should have produced. 113.44 113.44 113.44 106.08 113.44 113.44 These figures show beyond dispute the superiority of our operation. In these calculations I have not included the interest lost. It is well known that, in these transactions, the almost invariable rule is that the borrower loses 23 •on the first interest couiHiiis, without any deiluclion for the time durinj^ which ie has not liacl the enjoyment of the money. Tliis loss of interest frequently forms a pretty important sum. Takinj,' this into account, the net jjroceedH of our loan, that is to say, the amount really receiveil liy the Treasury was 83,u4r),Mr)3.r)8 •equal to y.'t.oG which carries to 4.18 per cent the rate of interest on the net proceeds received. Makin<( the same deduction for the other loans, a different result is naturally -obtained from that indicated in the talde just given. Tlie n per cent loan of 1874, for ?3,803,333.34, produced 83,624,232.77 or 8269,100.37 less than the amount of the issue. Tliis deduction revernment wanted apparently to secuie an lower rate, but only succeeded in doing 80 by sacrificing £78,600 sterling on tlie capital. This operation was so disastrous that three years later, when it became necessary to float the loan of 1882, Mr. Wurtele was forced to revert to the 5 per cent rate. This rate, then, was the established rate when we entered the market with the loan of 1888. To lower it to 4 per cent, the cun'ent had to be stemmed ; we had to fall a point at one stroke, while our predecessors obtained a fall of half a point only by sacrificing a considerable sum and found themselves, three years later, compelled to lose the ground won at the expense of such sacrifice and to revert to the old rate of 5 per cent. We had thus a serious obstacle to overcome and the success which we obtained places our operation far above all those of our prede- cessors. To show what the criticisms of the last loan are worth, it is only necessary to compare it with that of 1880, which was represented at the time as a magnificent operation. " The French loan " — said La Minerve — " at the rate offered and accepted, was an excellent financial operation." The amount of that loan was 84,275,853,34 and the proceeds realized were $3,693,587.79 or 86.38 per cent. The interest which we pay on the nomintj to 3nt ^ere ■ F? amount represents 5.21 per cent on the actual receipt. Tlie 4 per cent loan i)f 188ft produced net $3,345,953.68, which only makes the rate of interest we pay on the net proceeds 4.18 per cent. At the percentage realized by ^Ir. Chapleau, — 86.38 — our loan would have only brought S3,(J2o,3dO or ?322,6o3.68 less than we really obtained and this, without taking into account the advantage resulting from the diminution in the rate of interest ; next, at the mte we realized — 1).").96 — the Chapleau loan would have produced §4,087,715.78, while it only yielded $3,693,587.79 or S394,128 less, which is comparatively a losp to that extent. Mr. Chapleau paid 4^ per cent interest, while we only pay 4 on the loan of 1888. This reduction of ^ per cent on 83,500000 repre^ients a sum of $17,500 a year or $700,000 for the forty years which the loan lias to run. The difference between the percentage realized by our loan and that realized by the loan of 1880 amounts to $322,653.68. To this must l)e added the interest on this difference at 4 per cent during forty years, which makes ip516, 245.60 more. Summing up all these figures, we get the following result : Gained on the interest 8 700,000.00 " capital 322,053.68 Interest on the gain 516.245.60 81,538,899.28 Our operation is therefore better for the province by 81,538.899.28 than if we had borrowed on the condition accepted by the Chapleau Government in 1880. Consequently, 'he newspapers, wliich ha.e undertaken to critic^ize our loan, have taken good care to not compare it with the previctus loans of the province and, to find some pretext for their criticisms, they have seized ujion certuin other loans floated at nearly the same time as ours. Special stress has been laid on the fact that thvi colony of Victoria placed £1,500,000 at 108 and at 4 jitr cent interest and it has been endeavored to compare the two operaticjns in order to try to jirove that we should have obtained more tlian we did. This comparison is absurd from every point of view. There is no jxissible parallel to be drawn between the credit of Victoria and that of thi; rroviiice of Quebec. Apart from the fact that that colony had ali-eady negotiatt'd tliree heavy loans at 4 per cent and that its position was solidly established at that rati-, while oura was not, its resources and revenues are inf)'."*«ly greater than ours, without taking into account that its budget, for the fiv years from 1883 to 1888, shows 26 a surplus of receipts to the extent of $2,271,738.96, while ours displays only deficits running up into the thousands of dollars for the same space of time. Of the total debt of Victoria, which was £33,119,164 sterling in June last, JE25,404,847 or more than three fourths were employed to build railways which belong t(j the State and yielded it for the fiscal year 1886 and 1887 a net revenue of £1,088,94"), or nearly enough to pay the int3rest on its whole debt, which in 1887 amounted to £1,272,591. According to the Statistical Review for 1886 published by the Government of Canada, the revenue of Victoria is S140.45 per head of its population, while that of our i)rovince only amounts to S2.20 per head. Where is the intelligent man who will pretend that a province whose revenue only represents S2.20 per head can borrow on the same terms as a quasi independent colony, whose revenue exceeds 8140.00 per head. • .' Further, tlie bonds of Victoria are well known in the London marke*". and for a long time past have been quoted above par, so that the financial agents of that colony cnuld easily obtain the highest prices for their bonds. Tlie position of the province of Quebec was very different, as we had never borrowed in England at less than 5 and 4J. When these facts are taken into account, is there any reason to be surprised that English capitalists should prefer to our bonds those of Victoria and pay dearer for tliem ? It is unquestionable that the securities of the Province of Quebec, constitute as safe an investment as those of any other province whatever. But unfortunately these securities, like those of the Dominion of Canada, are not appreciated in that way in the London market, where they are not quoted as they should be. However, we could not help this : capital has its whims or its exigencies which a Government cannot control like a private individual or a banking house by bulling the market. Nevertheless, all the proportions taken into account, the negotiation of our 4 per cents, at 96 J was a much greater success than the negotia- tion of the Victoria 4 per cents at 108, as in our case by diminishing by 1 per cent the rate of interest, we raised by 20 per cent the value of the bonds of the province, while that of the Victoria bonds has not increased, but on the contrary has realized less than previous loans. t Finally, it will be admitted that the credit of the Dominion or the value of its securities should be higher than that of the bonds of the Province of Quebec. Now, on the London market, the bonds of the colony of Victoria are quoted at a higher fi a i: 27 le of its Now, I higher figure than those of the Federal Governinent, which clearly proves that it is simply absurd to pretend that we could have obtained for our 4 per cents the price at which those of Victoria are quoted. But there is on^oint on wliich I defy contradiction, and this is the fact that we got for the bonds we sold their full current value and even more. At the time of issue of the bonds of the loan of 1887, our 5 per cents were quoted in Ixindon at 112 and at from 108 to 109 in New York. Now, comparing the rL'lativc par values, it will be easily seen that 96J at 4 per cent is more advantageous than 112 at 5 per cent. As regards the Dominion 3^ per cents, which are actually quoted at 103 in the London market, the question is not so much to compc'ire tliis (quotation with ours as, in justice to us. to find out what that loan yielded net to tlie Federal Government, at the time of its issue and to not forget the important fact that the credit of the Dominion is naturally higher than that of the province. In 1884, the Federal Government issued a loan of £5,000,000 sterling or $24,333,333.33 at 3| per cent. The net proceeds of that loan were 821,551,337.62, .showing a loss of 82,781,995.71 for commission and discount. This loss raises the interest to 4 per cent and leaves the percentage received per SlOO at 89. There is a wide difference between this result and the calculations of certain newspapers, which seek to make the public believe that those bonds brought the Federal Government 101. The last Federal 4 per cent loan — that of 1885 — realized 99. The other 4 per cent loans of the Government of Canada yielded as follows : that of 1878, 95.40 ; that of 1877, 95 ; that of 1876, 88.50 ; that of 1875, 97.40 ; that 1874, 88. while that of 1870, with the Imperial guarantee, produced 103.63. As will be seen, the loans of the Government of Canada, whose credit is better established than that of the Province of Quebec, and whose resources are infinitely greater, did not return more, average term, than our last loan at the same rate of interest. Let me add that the 4 per cent loan of 1885, sold at 1 per cent over par, only realized 39 and would not have even yielded this percentage if the Government had been under the necessity of bringing the funds into the country ; l)ut it only wanted them to convert 5 per cents into 4 per cents, so that there was no displace- ment of the money and consequently no exchange to pay, which would have reduced the net proceeds to 97 i or to 98 at the furthest. We have been blamed for having sold the lionds of the last loan at a firm price, instead of placing them on the market by public tender. This censure in the part of these persons has no better foundation than the others. The mode of public tender, which involves risks that we did not care to run, was abso- lutely impracticable under the exceptional circumstances of the case. There was a regular organization to prevent us from succeeding or to force us to accept certain unfavorable proposals that had been made to us. It was simpl0 sought to blackmail ws, as I have been personally informed by a gentleman who was thoroughly posted in all that was being done towards that end. To defeat all these manreuvres, we transacted with an institution, absolutely independent by reason of its gi'eat resources and altogether unassailable by all combinations of the nature referred to. Moreover, by asking for tenders, we would not have got more than we did by selling firm. Clearly, we would not have been offered more than the current value of our five per cents on the market. At that date, these 5 per cents were rmoteJ at from 111 to 112 in London, and from 108 to 109 in New Vork. Taking into account the relative proportion of the values, 5 per cents at 112 are equal to 4 per cents at 94i or 95. This is unquestionably what we would have obtained by public Lender, as the bidders would have offered us the market price or current value. But from these 94i or 95, there would have to be deducted all the expenses of emission, which amount to about 2 per cent, so that the net proceeds- would not have exceeded 93. Inbtoad of that, we obtained 96^ or about 3^ more by eperating as we did, Tlie Victoria loan, upon which so much favorable stress has been laid, was put on the market by public tender, through the medium of the London and Weatminster Bank, one of the most powerful monetary institutions in England. At the time of the issue, the previous 4 per cent so thatc olony were quoted at from 109 to 111^ The tenders for the new loan did not exceed 108 to 109 and, as the colony had to pay the costs of issue and the bank's commission, it realized net much less than 108, that is to say, 4 or 5 per cent less than the current value of its bonds, This is the natural result of tlie system of public tender which certain people blame us for not having adopted. With that system, a very low price must be always. fixed as a minimum of the subscriptions, in order to make sure that the amount will be subscriljed, even in the event of political occun'ences or other circumstances^ which might affect the state of tlie money market, If we had proceeded by way of public tender, we would have had to fix a minimum price of about 95 and if any disturbance had occurred in the money market, this minimum might not have been reached and then we would have been obliged to accept the lowest price and the [province woulil also have had to pay all the expenses of emission and commission, which would have considerably reduced the net proceeds, 29 Through motives which are easily understood, certain parties pretend to see a ^reat wrong in the fact that, after having purchased our bonds at 9GJ firm, the "Credit Lyonnais placed them on the market at a quotation above par. If we committoji a mistake, it must always be admitted that we only followed the example of our critics. It is well known, that the loan of 1880 like that of 1888, was disposed of at a firm jjrica, without calling for tenders, at 98. It was placed on thejuarket at 1, 1§ and 2 per cent more and the Ministerial press of the >ti:ue found that this was the highest pi-aise that could be made for the operation. " Another piece of information which we can give our reader " ssaid La Minerve '" and which cannot fad to insjiire confidence in this financial oi)eration of the ■Quebec Government, is that the entire loan has been taken at 98J, 99, 99^ and 100, that is to say, that the whole has been subscribed for over the rate of •emission. But this is prccis:dy the case with the last loan. If it was " a mark of con- fidence in this financial operation of tlve Quebec Government " in 1880, why is it iiot equally so in 1888. The sam3 thing hajipened in 1883. The loan of 1882, sold at par to the Bank of Montreal, was placed on the market at 107 and the Montreal Gazette had Jiot a woivl to say against the circumstance, any more than the other newspapers which are now reproaching us for having done as the Chapleau Government did iu 1880 and the Mousseau Government in 1883, , It is contended that the value of our bonds has gone up since we sold thera. -Quite true ; but M'hat is the conclusion to be drawn from this ? Is it not that the vcredit of the Province has improved ? But is it a crime to have raised the credit «f tha Province and increased the value of its securities ? By Mr. Wurtele's operation, the Bank of Montreal gained 7 per cent in j)lacing at 107 the l)ond3 that he had sold it at par ; and yet no one •complained. The Credit Lyonnais gained much less on our bonds and the parties, who had nothing to say about the 7 per cent gained by the Bank of Montreal, now grumble at the much smaller profits realized by the Credit Lyonnais. Party spirit alone c^n explain such a want of logic. Moreover, it is quite probable that the rate obtained by the Credit Lyonnais was only tho result of a stock operation, such as these powerful institutions 30 can successfully manipulate. One of the London dailies, the Standard, objected to it as exaggerated. It said at the tim3 : '• The Credit Lyonnais iuvitjs "subscrip- tions here and in Paris for a loan of £722,000 in four per cent bonds of the Province of (Quebec. Nominally the bonds are offered at par, but the interest runs from the 1st instant and, as the whole of the money is not called till the 01th of March, the real price is a few shillings unJer par. Even thin thi bonds will be thought dear by many." The House will kindly pardon the somowhat lengthy explanations I have given in regard to this loan, but I have deemed it my duty to do so in view of the iinfair and disloyal attacks of which this financial operation has been the object. I cannot conclude my remarks on the subject without stating that we only have had to congratulate ourselves upon our relations with ^Ir. ]\Ioret, the •worthy agent of the Credit Lyonnais. In all the relations we had with that gentleman, he displayed much tact, great intelligence, uncommon ability, and the most admirable courtesy. We can assert that Mr. Moret and the managers of the Credit Lyonnais, while protecting their own interests, manifested a sincere, an openly expressed desire to renew and extend the business relations between France and Canada and to enhance the credit enjoyed by the Provinc3 of Quebec. We really experienced genuine pleasure to see the great newspapers of London ackoowledge the unquestionable success of our operation. The Honorable Pivmier and hi.s colleague. Honorable Mr. Garneau, had themselves occasion to note that. in France our institutions and resources are better known and appreciated and that in the future we need have no fear about entering the London or Paris market. Let me add that, in applying to the Credit Lyonnais, the Government could not have selected a more honorable and better known house or one that inspires more confidence and does a larger business with all parts of the old workL I am firmly convinced that, without the aid of that powerful institution, we would not have succeeded as well as we did, judging from the little eagerness, displayed by certain other financial institutions to give us the real value of the bonds we offered them. IV. Fiscal Year 188:-88. It will be readily understood that it is impossible to indicate with precisioa the result of the operations of this fiscal year, before it has closed. As compared d, objected !S 'subscrip- onds of the the interest ill the 01th nJs will be ions I have in view of IS been the it we only Moret, the with that :y, and the igers of the sincere, an is between of Quebec. ; of London le Pivmier note that, ciated and 1 or Paris overnment r one that old worhL ution, we eagerness, due of the precisioa compared 31 with my estimates, the real receipts and expenses show differences which are easily accounted for. All that it is possible to do for the moment is to examine a little the statement of the receipts and payments to the 1st April and draw therefrom certain conclusions. A glance at this statement suffices to show that the receipts will exceed the expenses by a considerable amount. I speak of the ordinary operations. On the 1st April, the ordinary receipts had reached §3,024,981. 65 and the ordinary expenses 82,259,960.14, which left a surplus of S765,021.5l, and it is probable that the surplus at the end of the year will not be materially diminished, if we realize all the receipts upon which we count. •. '. As for the extraordinary expenses payable out of the proceeds of the loan,, they need not be referred to. As I have already established, we found when we came to power an empty treasury and a large amount of floating debt, a portion of which was tlien payable and the residue at no distant date. We had also to provide for the current expenses of the public service and to meet which we had nothing, most of the appropriations being either insufficient or exhausted. After a year'.s administra- tion we have succeeded in restoring the credit of the Province ; we have consol- idated the floating debt, and, by means of this conversion, we have effected a considerable saving in the interest service. But we did not limit our exertions to this operation ; we gave attention to increasing the revenue, and, on this head, we can say that we have not been disappointed. We have collected a considerable amount of arrears of the lymimon school fund ; and, thanks to the changes we made in the license law ami the vigor^ with which we caused it to be enforced, we have materially increased the receipts from that source. We also hope for a large augmentation of our revenue from woods and forests, in consequence of the changes in the tariff of gr,)uud r^'nts and timber dues. The tax on commercial corporations has produced, to the 1st Aprils $557,165.00, which increases the receipts by as Hiuch more. This is what we have done in a year's administmtion, and, to-day, we are in a position to affirm that there is now an excess of receipts over expenses and, that^ thanks to our policy, the Province can look forward to the future without appre- hension. As far as the payments a^e concerned, I should add' that several measures of great importance have forced us into an expenditure that could not be foreseen 82 but which it was in the public interest to incur. Some items of expense will be over and some under the figure of my estimates, as already stated, and the supplementary credits to be asked f will show where the principal differences lie. Several of these additional credits u: . necessitated by the unforeseen expenses entailed by tlie important reforms we have effected in certain branches of the public service. We have adopted a policy of initiative, of reform and of well matured progress, and, if, to this end, we had to add a little to the expenses, the results obtained for the province amply compensate it for the augmentation. With a narrow policy, a policy without vigor, strength or \'itality, and never looking beyond its daily wants, we have nothing in common. Although it costs a little dearer, wo prefer a policy of initiative, of pro^^ross and of real advancement, which uoverthuless will not prevent the fiscal year from showing an excess of ordinary receii^ts over ordinary expenses. 1 Suppleineiitary Bu('get for 1887-88. The insufficiency of the appropriations voted for the current year calls for a supplementary budget of 8453,282.10 ; of which $285,000 are for the construction of the Parliament Buildings and the Quebec Court Hoji^e. The following is a list pf the additional sums required to meet the unavoidable expenses of the present fiscal year : Legislation.. §24,538.83 Civil Government 1,719.71 Public Instruction 1,484.80 Administration of -Justice 6,600.00 Tmmigraticm and Repatriation 3,300.00 Lunatic Asylums 11,000.00 Public Works : Rents, repairs, insurance 17,293.81 Crown Lands 57,344.93 $ 123,282.10 Codification 45,000.00 Public works imputable to capital : Construction of Parliament House $175,000.00 Construction of Quebec Court House 110,000.00 285,000,00 $453,282.10 se tic to fol 01 Tr a9- 00,00 182.10 The 824,538.85 are intended to pay certain services which cannot be left in suspense. The following is > ""ist of these : — Salaries S 2,933.19 Writers and messengers 4,234.84 Stationery 2,342.G2 Sundries 4,637.15 Unforeseen expenses 852.20 Library of the Legislature 2,500.00 Expenses of elections 5,000.00 Printing : For printing the report of the Provincial Secretary... $ 1,000.00 To pay an account due to the i)roprietor of the Montreal Gazette previous to the 1st February, 1887 1,038.85 2,038.85 824,538.85 The 81,719,71 asked for civil government are intended to pay the following services : — Department of Public Instruction 8 500.00 Registrar of the Province, to pay to I. P. D^^ry an a'^couut due previous to 1st. February, 1887 345.14 Accounts for subscriptions d«e to different newspapers previous to 1st February, 1887 874,5V ■^ 81,719.61 The amounts asked for charities are to supj ly the insuffioiency of the approi-riau- fcions for that purpose, arising from the increase of th3 number of children admitted t3 the reformatories and industrial schools. The additional credit for immigration and repatriation is made up of the following : Old accounts 8 1.80O.OO Travelling expenses and settlement in the country of a cert;iiu number immigrants from Brittany and other parts of France 1,500.00 83,300.00 8 84 Of the S17,293.81 asked for public works, there are 89,509.87 to meet certain exjtenses of maintenance f»f public buildings and 87,723.94 for repairs to court houses and gaols. All these expenses have been incurred on the recom- mendation of the Engineer of the Department of Public Works, who considered them indispensable. The !?11,000 for asylums are required to settle the accounts of the proprietors of those institutions to the end of the present month and to pay the medical boards. The f(dlowing sums are needed for Crown Lands : Surveys 822,844.93 General expenses 28,000.00 Cadastres 5,000.00 855,844.00 All these are to pay off arreirs on liabilities incurred previous to the 1st Tela-unry, 1887. Th»re is an item of 81,500 for stamps, licenses, &c. The Treasury officers wera obliged to carry to this account certain expenses incurred for the collection of the taxes on commercial corporations, as there was no appropriation in the budget for the same. The amount asked for the Codification is necessary to pay the cost of printing, binding and other expenses from this to the 30th June. The appropriation asked for the construction of the Parliament Buildings embraces 395,000 for a settlement with the contractor to the 1st July, 1887, of all claims disputetl and undisputed to that date, and 880,000 payable from this to the end of the fiscal year for works executed in virtue of the contracts, and certain unforeseen works mentioned and recommended in the Engineer's report. A sum of 8110,000 is also needed to pay for works executed according to the contracts for the construction of the Quebec Court House. All these payments on construction account are imputable to capital and do not affect the result of the ordinary operations. 35 mting, to the Ind do VI Fiscal Year 1888-89. I estimate tlie receipts of this fiscal year at ^3,403,672.80, of which S58,000 •will be receipts on capital account and 83,34'),G72.80 for ordinary revenue. This estimate is based on the receipts of the last fiscal year, taking into account the changes more or less likely to occur in certain items. The following is an enumeration of the receipts : Dominion of Canada : >>ubsidy payable in virtue of Confedertition Act S 959,252.80 Interest on trust funds 55,459.32 .Special subsidy under 47 Vict., Cap. 4, Dominion... 127,460.68 Interest on railway subsidy under 47 Vict., Cap. 8, Dominion 119,700.00 $1,261,872.80 Interest .• Interest on price of sale of Q. M. 0. Sc O. Railway... S 375,000.00 Interest on loans and deposits 40,000.00 Interest on collections made by Ontario CJovernment on account of common school fund 30,000.00 445,000.00 Administration of Justice : I^w stamps 8 160,000.00 I^iw fees 5,000.00 Building and Jurv Fund 15,000.00 Municipalities for maintenance of prisoners 16,000.00 Gaol guards, Montreal and Quebec 4,000.00 Fines 2,000.00 Montreal Gaol 2,000.00 Court House, Montreal 2,000.00 High Constable's fees, Quebec 600.00 209,600.03 Registration stamps 16,000.03 Licenses 340,000.00 Crown Lands 821,000.OJ 86 Taxes on commercial corporations $ 125,000.00 (arrears) 50,000.00 Percentage on fees of public offices Percentage on renewals of hypothecs Legislation 0£icial Gazette Lunatic Asylums : Contributions from municipalities for 1888-89 8 25,000.00 Arrears of contributions 10,000.00 Hents, t&c, of public buildings.., Contributions to pension fund Casual revenue Quebec Fire Loan Repayments by the proprietors of the St. Jean de Dieu and Beauport Asylums $ 8,000.00 Municipal Loan Fund 50,000.00 175,000.00 7,000.00 500.00 3,000.00 23,200.00 35,000.00 1,000.00 5,000.00 2,000.00 500.00 .^3,345,672.80 58,000.00 S3,403,672.8O Tliis estimate has been made with the greatest possi!)le care and I have every reason to hope that we shall take in the amount indicated. The annount to be received frum trust funds calls for no explanation, a& it is the same as in past years. I hope to collect the S30,000 put down as interest on the collections on, account of the common school fund. We are actually negotiating with the Ontario Government on the subject and there is every reason to anticipate an early and final settlement of the question of the common school fund. The House is in possession of the bill intended to give us the necessary authority to effect this settlement. In any case, I have every ground to think that we shall collect these $30,000. 97 Tlie receipts from the ailininUtratiou of ju3ti(;.' will j»rol»ably yield more than the figure of my estimate, hectiuse that estimate is ))ased on the receipts of hist year, several items of which fell below the usual figure. In consequence of the general elections of 1886, (mr predecessors did not insist upon the municipalities paying up their indebtedness to the Government and, on coming into otiice, wo had not the time to devote our attention seriously *o these collections ; but, since then, we have taken the matter in hand and are now hiboring to get in what is due by the municipalities to the building and jury fund, as well as for the maintenance of the insane in the asylums, and I hope in consecjuence that the receipts arising from the administration of justice will exceed the tigure of my estimate. The revenue from licenses is estimated at ?340,000. Tliis was the amount received from this source last year and the information supplied me l>y tlie ofticers of the deparment leads me to believe that this estimate is rather under than over the reality. Since we have had the adiuinistration of affairs, we have devoted special atten- tion to the enforcement of the license law , we have effected a number of reforms in this service, orgixnized a system of the strictest supervision, and the care which we have given to the collection of the revenue has resulted in a material increase of receipts arising from this source. Lsist year ,these receipts exceeded §340,000 and, this year, if we can judge by the entries which have already come in, we shall get the same if not a larger amount. To make the ex istiug liw more effective, it should be so amended as to provide for a severer punishment of violations and I hope that the bill, actually under the consideration of a special committee of the House, will enable us to legislate in a way to satisfy the friends of good order and to prevent the illicit traffic in intoxicating liquors, whicli is the cause of most of the evils and disorders of which the advocates of temperance complain. For the current fiscal year, I estimate at 8657,700 the receipts from Crown lands. The officers of the department are of opinion that the changes which we have made in the tariff relating to woods and forests will produce an increase of 850,000 a year in the revenue from ground rents and 8100,000 in the receipts from timber dues. Allowing for this increase, I put the revenue for next year •from Crown lands at 8821,000. The revenue from taxes on commercial corporations is estimated at 8125,000, This is the average of the arrears accrued since this law went into force, as well as the figure at which this receipt was set down by Mr Wurtele, the author of the law in question. My estimate includes also 850,000 of arrears and, if the pending .suits are decided in our favor, this sum of arrears will be materially increased. 38 I count up^m getting 835,000 from the municipalities for their contributions U the cost of maintaining the insane in our asylums. This estimate is not exaggerated and will be more than realized, if we succeed in collecting only a. portion of what is due to us under this head. But, as I stated last year, the municipalities show little inclination to settle what they owe to the Government and nearly all over the tendency is to throw upon the Government what properly should be the duty of the municipal corporations. This evil tendency of the municipalities must necessarily be checked. The municipal corporations should understand that the Govemement cannot stand the sacrifices it is making to develop the resources of the country, to improve agriculture, advance coloni- zation and aid the construction of railways unless it collects all that is owing to it especially by the municipalities which directly benefit by these sacrifices. I hope to collect $50,000 on account of the amounts still remaining due to the municipal loan fund : This receipt is more or less certain ; for the last fiscal year, my predecessor counted on a receipt of S100,000, but only !85,380 were received. The municipalities show just as little willingness to pay these debts as the others they owe the Government. Some of them have been impressed with the- idea that they will never be called upon to pay off their indebtedness to the municipal loan fund and it takes a good deal of trouble to convince them of the- pontrary and to get them to settle. I estimate at 84,475,222.86 the total payments of thid fiscal year, made up- as follows : Ordinanj expenses : ' . Service of the public debt 81,100,153.00 Administrative service 2,177,206.04 83,277,359.74 Expenses Im^ndable to capital Subsidies to milway companies 8 783,500.00 Cjustruction of public buildings 414,303.12 Total 81,197,863.1? 84,475,222.8a- 39 Let us go a little into the details of this general result : The first item is the service of the public debt and is made up as follows : Interest on the funded debt , $1,023,983.70 Interest on trust funds 9,740.00 $1,033,723.70 Sinking fund and redemption of bonds 59,429.30 Expenses of management 7,000.00 $1,100,153.00 The interest service shows an increase of $25,780.33, which is easily ■:nder- stood. Of the liabilities composing the floating debt, which were oiitstanding on our entering into office, we have paid considerable sums to railway companies, as well as for the construction of the Parliament Buildings and the Quebec Court House* Under the administration of our predecessors, these sums existed only in the state liabilities and bore no interest ; but they have since become payable and to pay them off, the loan had to be contracted whicli at present swells the credit intended for the service of the public debt, so that w^e are in no sense responsible for this incrf iise which would have l-een still greater if we had not succeeded ia getting a reduction in the rate of interest on the lp".t loan. J63.12 J22.8a The expenses of legislation are estimated at $190,850.0 J. For the fiscal year 1886-87, they amounted to $278,1 fi9.97, and for the current fiscal year they wiU probably attain the figuie of $213,063.32. Tliere is therefore a reduction of $87,319.97 in the renl expenses of the last fiscal year and of $2,215,32 on the probable ex^en-ses of the present one. This reduction is '. iposed as follows : Salarie.s, contingent expenses, printing, binding, «S:c., of the Legislati'<'H Assembly $10,715.32 Salaries of employees and contingent expenses of the library of the Legislature 3,050.00 Expenses of elections , 5,000.00 Office of Clerk of the Crown in Chancery 600.00 $25,365.32 40 From these reductions, the following increases must be struck : Salaries of the Speakers of the two Houses, each increased by SIOOO 82,000.00 Library of the Legislature, for printing, binding, &c 1,000.00 Salaries and contingent expenses of the Legislative Council 150.00 Final reduction 3,150.00 S22,215.32 For the current fiscal year, the expenses of civil government will piobably reach S207,958.t37. For next year, we ask $219,776.00 or an increase of $11,817.33, of which 89,099,81 are for contingencies. The residue of the increi se is occasioned by the organization of the new department of agriculture ai, 1 colonization. The administration of justice is going to cost 8555,310.95 thii3 year, wliich is more than it has cost in previous years, and we ask for the next fiscal year $495,938.98 or $59,371.97 less. Necessarily, the expenses of *,his service keep on increasing with the population and development of the country, two causes which are constantly adding to the volume of our judicial business and the numljer of prisciuers to be maintained. It was on the strength of this unavoidable increase that my predecessors, Hon. .Judge Wurtele, and the honorable member for Sherbrooka got the House to adopt resolutions calluig on the Federal Governmenu to assume the expenses of the administration of criminal justice. In all cases, there is very little difi'oreuce between the credit entered in the budget and the amount expended for the same purpose in 1887. The appropriation asked for public instruction is 8389,035 or $19,565.20 more than the amount voted last session for the current fiscal year. The following are the items affected by this increase : — Schools in poor municipalities $ 2,000.00 Primary instruction 300.00 Congress of School Inspectors 500.00 Scholastic museum 600.00 College of St. Genevieve, in the county of Jacr^ues Cartier, instead of its annual grant, a sum, once paid, of 1,000.00 Eoxton Commercial College 200.00 Convent of St, Cyprien SOD.OO 41 )0.00 )0.00 )0.00 fo.oo p.oo lo.oo Ci.OO Convent of St. Norbert 200.00* Joliotte College, to aid the conatruction of a building for the commercial course 2,000.00 Prize books 15.20 Convent of St. Jean Baptiste of lioxton, to aid its construction 200.00 Marist Brothers, Upton 200.00 Varennes Commercial College, to aid its coiistruction 2,000.00 Terrebonne Commercial College, to aid its construction 2,000.00 Chicoutimi College 1,000.00 Distribution of education laws among school commissionners and trustees 4,000.00 Literary and Scientific Institutions. Quebec Literary and Historical Society , 500.00 Academy of Music 100.00 Geographiciil Society ,.. 100.00 Board of Arts and Manufactures 1,000.00 To put in force the Factory law 4,500.00 The following grants disappear : St. Thcrese College 3 2,000.00 §24,015.20 Kimouski " Journal of Public Instruction. 2,000.00 45(1.00 '■.'Vli'ch reduces the increase In the service to. 4450.00 810,555.20 The credit asked for agriculture is 8114.100.00. For the current iiscal year, it \v;wi S115,089.78. There is consequently a slight diiuiuution of S'J80.78. The new iiums are : Veterinary school § 200.C0 Butter and cheese factories 3,000.00 Prizes to encourage agriculture 200,00 Permanent E.xhibition Committee 4,000.00 Stenographers 1,500.00 Arboriculture 300.00 .•'vrcJ' se of registers and other office requisites for the organization of the bureau of agriculture 1,500.00 Board of Health 2,610.22 813,310.22 42 The retreiiclmieiits are in the following items : Special grant to aid agiicuitural schools to provide themselves with butter factories 1,000.00 Richmond Agricxiltural College 1,000.00" Organization of the now department of agriculture 3,000.00 District agricultural exhibition 1,000.00 Agricultural Commission 3,000.00 Roads and bridges, Beauce 3,000.00 Journals of Agriculture 300.00 Provincial exhibition , 2,000.00 $14,300.00 A comparison of these i\. > tables gives the following result : Items reduced 814,300.00 " increased 13,310.22 Net figure of the decrease ... 8 989,78 We ask .^8,500 for immigration and repatriation. Of this credit, we propose to devote 82,500 to bringing emigrants into the country from France and 82,000 to rejjatriation. , The various credits for colonization amount to 8124,500, which shows an increase of 845,000, made up as follows : — Colonization societies $ 5,000.00 Colonization roads 30,000.00 Deepening the Lacolle river to reclaim a large area of flooded laud 4,500.00 Deepening the little Montreal river for the same purpose 500.00 Aid for the construction of a steamboat on Lake St. John 1,000.00 Publication of topographical reports and pam])hlets on colonization 4,000.00 845,000.00 Against this increase, about 83,000 of credits disappear, which reduces the real increase to 842,000, that is to say, that instead of 8205,189.78, the probabla amount of the expenditure for these purposes during the current fiscal year, the expenses for agriculture, colonization, immigration (^nd repatriation will attain next year the figure of 8247,100,00. 43 We would have liked to do more for agriculture aud tlu; great cause of coloni- zation ; but we have to consider the requirements of the j»ul»lic service and the resources at our command. If we succeed in converting the funded debt and in getting the Federal subsidy increased, we shall employ a portion of this,additi(jnal revenue in laboring still more energetically for the settlement of our public lands. The credit for public works and buildings, chargeable upon the or municipa- lities 5,000.00 Macadamizing roads in lieauharnois county 2,000.00 I'ayiiiout to Jos. Dussault for 10,000 colonization pamphlets on (;:is].esia ...., 2,389.5? Interprovincial Conference 810,094.23 823,483.73 The total of the expenses imputable to capital is considerably reduced. We ask 8414,363.12 for public works and buildings and 8783,o00 for subsidies to railway companies, making in all 81,197,863.12. For the current fiscal year, tie expenditure for public buildings will reach ^77-"),o00 and the subsidies paid to railway companies will probably come up to 8812,406.40, or a total, for these two items, of 81,587,906.40, which exceeds by 8390,073.28, what we propo.se to expend next year. The following table shows the items in which there are increases or decreases : — 1887-88 1888-89 Parliament Buildings 8 250,000.00 8125,729.53 €ourt House, Quel>ec 2 42,733.59 Spencer Wood, to finish the stables, for a carriage shed and to build a lodging for the coachman and another for the guardian 4,000.00 Circuit Court, Kamouraska 6,000.00 2,500.00 Court houses and gaols in new districts 6,000.00 6,000.00 Court House, Arthabaska 6,000.00 1,400.00 Montreal 200,000.00 50,000.00 Iron bridges 25,000.00 100,000.00 Codification of the laws 45,000.00 63,000.00 McGill Xormal School 2,500.00 Trotestunt Lunatic Asylum 25,000.00 15,000.00 8775,500.00 8414,463.12 The expenses which we propose with regard to the construction of public buildings are absolutely necessary. 47 As for the rarliiiiucnt lUiildings and the Quelle Court House, we are tletennined to finish them com})letely Itotween this and next year. Tliese works have been going on for some years and we want to see t'le end of them, so as to strike them altogether out of tlie biidgct. I may be, perhaps, allowed to add that these two edifices have cost a little dear, ])ut this is not our fault, as they were begun by our predecessors, and we have simply carried to completion the plans and contracts which existed when we came into office. The province was bound in the matter, and we were obliged to honor its engagements, for which we are in no sense responsible. Now, Mr. Speaker, if we bring together the estimate of the ordinary receipts and that of the ordinary expenses for the fiscal year 1888-89, we get tlie following result : — Ordinary receipts 83,345,672.80 Ordinary expenses 3,277,359.74 Surplus of receipts over expenses S 68,413.06 In the presence of such a result, especially when contrasted with that of past years, it seems to mo that we have tlie right to state . that we have kept tlifl promise we made to the country to restore good order and to reestablish an equili- brium in the financial situation of the province. The expenses necessarily increase with the requirements of the pul)Iic service and the fresh wants created by the progress going on in the development of the country's resources ; but we have found means to increase the revenues, so that we have secured a surplus in the ■ordinary receipts, without laying any new burthen on the people and while devoting considerable sums to the advancement of colonization, education and the general interests of agriculture. 48 VII. General Remarks. Mr. Speaker, the expose' which I have just submitted to you should convince all impartial men that we have kept our promise that we would do our best to place the finances of the Province on a healthy basis. We have already considerably increased the revenue from licenses and I hope that we shall still further increase it by means of the vigorous supervision which we have organized to enforce the law on the subject. We shall in a similar manner increase by 8150,000 our receipts from woods and forests. This increase comes from the changes we have made in the tariff . but more than that we are endeavoring to bring it up to a still higher figure by imparting more efficiency to the outside service of the department and by preventing such frauds as have been committed in the past. The information we have actually before us, enables us to affirm that these frauds have caused an annual loss of 8100,000 to the province. If we succeed only in preventing the half of them, there will be already a gain of 850,000. The conversion of the floating debt represents also a gain of 830,000 as com- pared with the rate of interest paid by our predecessors. The energetic action we have taken with regard to the tax on commercial corporations will yield us an increase of revenue which Hon. Mr. Wurtele estimated at 8125,000 a year. There is no doubt that the law which imposes this tax contains provisions which are somewhat arbitrary ; but it is the law and we are forced to observe it as it is so long as circumstances will not allow of its repeal. We regret to bo under the necessity of collecting this tax, but if we obtain the changes we ask in the figure of the Federal subsidy, I have every reason to believe that we will be then able to consider the propriety of materially modifying or repealing it. We have collected several debts, the settlement of which had been long dragging. Tlius we came to a settlement with the city of Montreal which brought 8125,000 into the provincial chest. We are also on the high road to settle with the province of Ontario the long vex3d question of the common school fund. The Ontario Legislature has just passed a law pioviding for a settlement of this matter by arbitration and there is actually before this House a bill for the same purpose. The negotiations are already fairly advanced and, unlesss some unforeseen difficulties should spring sil sij l"l 49 siuMeiily up, I foel tluit this afTair will be dofinitely sottled lieforc the end of the suiuiiier. In any case, wo shall hasten that settlement as en(!rgetieally as possilde. I need hardly insist on the importance of the step we have taken J,(j iiuj.K.vo the financial situation of tlie province liy holding the Interpntvincial Conference. The resolutions of that Conference dealing with the readjustment of the Feileral subsidy would result, if carried out, in increasing our revenue to the extent of 8347,967.80 a year and establishing the financial position of the Province on a sound and pennanent basis. Lastly, we have opened negotiations with the view of converting the consolidated debt in order to reduce the rate of interest which it bears. It will be easily un- derstood that I cannot give the House for the moment the details of the project we have in view, without compromising the interests of the province or damaging the success of our negotiations. If effected on the desired terms, this conversion will save the province nealy a quarter of a million of dollars. .Such, Mr. Sjteaker, is the record of our fiftjen mouths' administration, and, in the face of the facts just exposed, it seems to me that the House will admit that I was right in claiming at the beginning of my present statement that we have fulfilled our promise and brought the finances of the province into a sound condition. Tlie present fiscal year will show a considerable increase of ordinary rjceipts, and, if it only depends on care in the collection of the revenue, I can afiirm that this state of things will continue. • ••• i ' • - « . • » » * ) 1 % ■ • » * * 1 • • • t.» ^nsrnsTExiEs TO THE BUDGJ^ET SPEECH. l/'^mnKs' :■ Dominion of Canada, Subsidy Interobb from Ontsu-io Common School Fuhd Crovm Lands Licenses Administration of Justice Percentage on the Fees of Public Officers Legislation ... Lunatic Asylums, Contributions by Municipalities. Official Gazette Public Works and Buildings, rents, &c Casual Revenue Contributions to Pension Fimd...*i Interest on Deposits Interest on price of sale of Q. M, 0. & O. Railway.. Provincial Insurance Companies Premium, discount and exchange Refunds Insurance on old j... liament House .. Industrial Schools TA Quebec Fire Loan Municipal Loan Fund Repayments on loans to picprietors of Lunatic Asylums Fees ou Marriage Licenses Teachers' Pension Fund • Security Deposits by Public Officers R. Catholic Sup. Fducation Fund for schools, of arts and sciences. / Mr. Robert- son's estimate for 1886-87 Total Receipts on the 31st January, 18S7 Balance of estimates to receive from 31 st Jan. to 30lh June 1887. Amount received over the estimates on 31st Jan. 1887 Revised esti- mates of the amount to come in bet- ween Slst January and 30th June Re( th $ cts 1,201,872 80 30,000 00 700,000 00 275,000 00 238,500 00 7,0C0 00 4,0C0 00 35,0f0 00 20,750 00 1,000 00 1,500 00 5,000 00 30,000 00 375,000 00 I 2,984,622 80 500 00 100,000 00 $ cts l,202j022 80 396,9?7 75 47,192 08 106,086 82 5,707 74 3,924 99 6,271 53 11,723 84 2,232 82 636 15 3,017 88 32,206 08 185,942 11 330 86 67 06 511 40 32,765 00 2,0.37,596 91 5,380 00 7,12.5 00 3,612 00 33,000 GO 6,500 00 $ cts 59,850 00 30,000 00 303,042 25 227,807 92 132,413 18 1,292 26 75 01 28,728 47 9,026 16 863 85 1,982 12 189,057 89 $ cts 1,232 82 2,206 08 984,139 11 500 00 94,6-20 00 1,375 00 % cts 59,850 00 30,000 00 278,042 25 235,807 92 117,413 18 1,292 26 75 01 28,728 47 9,026 16 1,000 00 863 85 1,982 12 1,000 00 183,057 89 350 00 3,438 90 048,489 1 500 00 4,000 00 )ver ates an. cts I 82 ') 08 TABLE explaining the variations which occurred in the Estimates for tl Revised esti- mates of the amount to come in bet- ween Slst January and 30th June Received over the revised estimate $ cts 59,850 00 30,000 00 278,042 25 235,807 92 ]17,413 18 1,292 26 75 01 28,728 47 9,026 16 1,000 00 863 85 1,982 12 1,000 00 183,057 89 350 00 i 90 918,489 1 500 00 4,000 00 Kiceived less liian the levised esti- mate Amount received from the 1st Feb- ruaiy to 30th June, 1887 •f cts $ cts 30,000 00 17,620 48 59,215 48 21,457 42 4,596 39 3,604 95 3,337 27 296 36 26,627 51 107 50 237 93 418 85 24 40 146 02 1,994 64 3 80 90,907 80 ; 78,781 70 3,372 00 22,056 80 2,000 00 273 25 380 00 .,^500 (jO Totrtl amount received foi' the fiscal year 1886-87 Amount ] Amount received over ! received less ex-Treasurer Robertson's estimate than Mr. Robertson's estimate $ cts 59,850'00 295,662 73 295,023 40 95,955 76 5,888 65 3,679 96 2,100 96 12,363 43 1,296 36 756 35 2,220 05 581 15 183,033 49 203 98 $ cts 1,261,872 80 1,994 64 3 80 960,614 71 120 00 r)')0 00 3,372 00 22,056 SO 2,000 00 273 25 692,620 48 342,215 48 202,042 58 11,596 39 7,004 95 8,372 49 24,087 27 3,529 18 1,392 50 5,237 93 32,787 23 368,975 60 534 84 67 06 2,506 04 32,765 00 3 80 ',998,211 62 120 00 5,380 00 7,626 (H) 6,984 CO 55,056 80 8,500 00 273 25 $ cts 67,215 48 4,596 39 3,604 95 3,337 27 2,529 18 237 93 2,787 23 534 84 67 06 2,506 04 32,765 00 3 80 120,185 17 6,984 00 5.5,056 80 8,.500 00 273 25 $ cts 30,000 00 7,379 52 36,457 42 26,627 51 107 50 6,024 40 106,-596 35 380 00 94,620 00 875 00 Public Debt, interest on Funded Debt. " " Temporary Lonns am " sinking fund, redemption of b( Ciiarges of managemeni , Leg! lation Civil Government Adn3inistratiou of Justice , Police Reformatory Prisons and Schools and Inuu.-j Inspection of Pubjic Offices Pubiic Instruction PcicMitific and Tjittrary Institutions , .\rt.s and Manufactures Agriculture Immigration and Repatriation Colonization ^ Public Works and Buildings, rents, insurati Inspection Repairs to Court House, insurances, Lnti die Asylums Surr iry charita"' 'nBtitutions " " in gener.T,l . . Agput in France To!i( tiers' Pension Fund, instalment for 6 y Civil Service Pension Fund.... Municipalities' Fund R. Catholic Sup. E0 63 S,250 00 75,546 01 4,535 74 139,500 0.> 35,901 68 26 15 11,360 12 131,386 01 39,316 00 1 1 ,985 SO 1,166 66 8,713 95 72 00 500 00 102,000 00 2,000 00 6,249 60 iSBk 6! q 3 ! t( $ cts 417,288 49 58,335 52 3,839 23 88,425 14 70,367 66 126,137 32 5,107 75 32,674 11 3,275 66 103,7.5(1 00 6,312 08 3,250 00 26,368 99 3,464 26 15,500 00 20,727 32 1,973 85 8,746 64 9SG13 99 8,014 20 ]i333 34 6,286 05 4,928 00 34,811 00 I f cts 43,000 00 21,437 22 7,4.30 19 10,000 00 750 00 4,000 00 6,410 00 7,-599 16 606 GO 10,(00 00 13,000 00 6 0(K) 00 8,250 40 17,600 00 Supplenipjitary estimate, 81st Januar};, 1887 I Amount estimated re- quired from 3 1 si January to 30th June, 1887 Expended over the estimate according to the Public Accounts Expended less than the estimate ac- cording to the Public Accounts Total amount of expenditure from 31st Jan. to 30th June, 1887 Total expend- iture for the fiscal year. Total amount of expenditure over Mr. Ro- bertson's first estimates Amount expended less $ cts 43,000 00 21,437 22 7,430 19 10,000 00 750 00 4,000 00 6,410 00 7,599 16 606 00 10,(00 00 13,000 00 6 0(K) 00 17,000 00 $ cts 417,288 49 43,000 00 27,480 85 3,839 23 109,862 36' 77,797 85 136,137 32 5,857 75 36,674 11 3,275 66 110,160 00 13,911 24 3,-J50 00 26,974 99 3,464 2() 15,500 00 30,727 a 2 1,973 85 S,74() 61 111,613 99 f cts 29,557 33 1,053 87 18,000 00 $ cts 01 9,361 42 01 982 40 414 01 727 24 8,014 20 1,3 3 34 6,000 00 6,286 05 4,928 00 7,9:iO 00 3,6S5 OS 13,044 78 52,411 00 8,250 40 %■• 10,216 72 5,600 00 1,400 27 619 55 2,540 75 HC6 21 4,784 00 300 00 $ cts 417,288 48 33,638 58 27,480 84 2,856 83 139,419 69 78,851 72 154,137 32 5,443 74 36,674 11 2,548 42 110,160 00 10,226 16 3,250 00 13,930 21 3,464 26 15,500 00 38,647 32 513 58 8,127 09 111,613 99 5,473 45 1,333 34 6,000 00 5,419 84 144 (iO 10,216 73 52,111 00 5,600 00 y,'':i(» 40 $ cts 888,504 21 67,038 92 54,3b9 44 6,119 57 278,169 07 193,904 06 392,218 48 14,425 99 84,452 00 6,272 76 355,295 00 24,106 79 11,500 00 89,476 22 8,000 00 155.000 00 74,549 00 539 73 19,487 21 243,000 00 39,316 00 17,459 25 2,500 00 6,000 00 14,133 79 216 00 10,716 73 154,111 00 7,600 00 14,5(X) 00 $ cts 42,038 92 60,209 07 8,484 06 28,000 00 335 99 4,00C 00 6,410 00 5,056 79 17,920 00 13,000 00 0,000 00 10,716 73 17,300 00 5,600 00 $ cts 01 30,854 68 982 40 727 24 7,438 78 1,460 27 619 55 2,540 75 866 21 4,784 00 ■^^(^WPi I UUBIUU P UIVJ. ..r •2^^- Security Deposits by Public Officers E. Catholic Sup. Education Fund for schools of arts and sciences 33,000 CO 6,500 00 3,093,022 80 2,093,213 yi 1,080,634 11 3,438 90 952,989 Hi 1 22,0.")G 80 l',r,o 40 2,9 i 6 83 3,5(iO 00 6,119 21 375 (10 874 65 10,71() 73 154,111 00 7,600 00 14,500 00 9,319 56 9,500 00 12,000 46 900 00 3,374 65 10,716 73 17,300 00 5,600 00 17,000 00 52,411 00 300 00 5,600 00 8,250 40 5,597 27 3,500 00 5,00) GO 475 (JO 15,500 00 1,000 00 2,680 44 2,680 44 S,500 00 5,000 00 9,500 00 12,000 46 1,119 21 100 dO 14,625 35 1,000 00 100 00 14,625 35 1,000 00 2,000 00 1,600 00 28,748 62 2,000 ()() 1,600 00 ■JS,7h 62 iS,i 00 00 2,000 00 1,600 00 28,748 62 ■ 18,000 00 2,000 00 1,600 00 2S,748_62 18,000 00 ' ' 18,00) 00 18,000 00 174,332 57 1,323,831 17 105,815 76 57,191 52 i,iTj-r)r) 41 3,318,414 51 296,920 64 68,679 08 130,000 GO 120,000 00 130,113 91 122,823 J 5 122 00 4y,7 58 129,991 91 122,335 57 184,298 00 193,212 42 7,791 00 8,000 00 736,896 70 129,878 00 119,512 42 7,794 00 11,000 00 486,000 00 7,000 00 371,568 20 4,000 OJ 114,431 80 7,000 00 4S6,000 00 486,896 70 910,332 57 2,073,768 23 105,815 76 436,:i6y 30 1,743,214 69 4,448,615 63 1,041,001 76 75,679 68 I 53 "■ ■ , . ■■ . .1 - 1^ — . , _ . — UEMAKK8 ON THIS TABLE. A glance at this table M'ill show that, rleducting the expenditure for the construction of the Parliament Buildings, the Quebec Court House and the Q. M. 0. & 0. Kailway, the estimates for the live months embraced between the yist Januaery and the 30th June, 1887, were as follows :~- Estimated expenses Sl,323,831.17 " receipts 952,989.11 Probable deficit S370,842,06 But, as certain variations occurred in the receipts and payments, the real operations were as follows ; — Actual payments for those five months SI, 372,455. 41 '• receipts " " 988,03G.7G S383,518.65 Certain items of the receipts, as indicated in the table, exceeded the figure of the estimates, for those five months, to the extent of.. 8118,609.35 Others fell short of the estimates to the extent of 82,661,65 Which leaves a surplus of receipts to the amount of. 835,947.65 Certain items of the expenses, as indicated by the table, also exceeded the figure of the estimate for these five months to the extent of. 8105,815.76 While others fell below it to the extent of. 57,191.52 Which leaves an excess of expenditure 848,624,24 As compared with the estimate. Now, if you strike from the net excess of payments over the estimates as above 848,624.24 The excess of receipts over those same estimates 35,947.65 A difference will he found of 812,676.59 Which represents the net result of the variations in the estimates of the receipts and payments for the five months in question, 1 i 54 The addition of this sum or this excess to the deficit foreseen gives the follow- ing result : Deficit foreseen <.. §370,842.06 Excess of expcndiluru over the estimates 12,670.59 liual deficit for the five mouths 8383,518.65 According to the estimates of February, 1887, the operations of the wliole fiscal year were to result in a deficit of §370,842.06 To this foreseen deficit, must be added the supplement- ary budget 839,190.57 Less the items of the l)U(lget remaining outstaiKling on the 30th June, 1887 7,100.00 32,090.57 8402,932.63 The special warrants must also be added 835,737.22 Less the amount of these outstanding on the 30th June, 1887 2,096.59 3:3,640.63 Which carries the apparent figure of the deficit to 8436,573.26 But from this apparent deficit must be deducted the excess of receipts over the estimates of February.. 83r);947.63 The expenses which fell below the figure of the estimate and the special warrants.. 857,191.52 Less the following expenses not covered by the budget : Eoyal Rommission re Q. M. 0. &0. Railway 81,119.21 Teacher's Pension Fund 10,216.73 Building and Jury Fund 28,748.62 40,084,56 17,106.96- 53,054.61 8383,518,65 Which corroborates tlie deficit as above established. i-.mm.>*^^lfmm^':^*-„».,mmm 55 L'ives the follow- .. .i?370,842.06 12,670.59 8383,518.05 lie .. 8370,842.00 ■oi 00 - 32,090.57 8402,932.63 22 59 — 3.3,640.63 8^36,573.26 03 [)6- 53,054.61 By making an estimate of the receipts and expenses for the fiscal year 1886- 87, and a separate classification of the ordinary receipts and expenses from those ; which are not so, the following results are obtained : Total amount of expenses 83,289,697.78 Total amount of receipts 2,965,446.62 Deficit 8324,251.16 Estimated receipts 82,984,622.80 Bcal amount received 2,965,446.62 Deficit , 19,176.13 Estimated expenses 83,090,173.55 Heal expenses 3,289,697,78 Excess of expenses overestimate 8 199,524.23 ■I The difference between the estimated and the real deficit is accounted for by the variations which occurred in the receipts and expenses, as compared with the figures of the estimates, namely : — The receipts yielded less 8106,596.35 ' And more 87,420.17 \ Net shortage 819,176.10 The expenses show the following excess :- /Amount expended more 8236,366.81 I " « less 36,842.59 Net excess 8199,524.23 ^383,518,65 V 56 — <■ ■ , ^, ... „ J , \ A cornitarison of those difrercnt amounts with tlio ditference in the estimate of the receipts and expenses, gives the following result : Estimated expenses 83,090,17:5.55 " receipts 2,984,022.80 8105,550.75 Amount received less 19,176.18 " expended more 199,524.23 I>eficit ■ S324,251.1G The dill'erence betwt'cn the estimated and the actual receipts and expenditure, as shown by the summary jirepared by the department, is accounted for by the classification of the items which is a little different in each case. Some of these items are set down as ordinary expenditure in the estimates, whilst, in the actual receipts and payments, they are classified as they should l)e. Quebec, 8th March, 1888. ' \:a ( ^ V 67 iute I ).75 ).18 1.23 ..IG lire, the lese ;ual i « c V a c o to 'i S o u o u n o 0) > JS a o •3 e n c a o 3 o s a CO c o -3 ■S 3 = I 01 -3 o O 00 39 c o 10 B 3 u "3 V G « o "3 sS 3 O XI o > J3 3 O • CO 00 C eJ O ,a o at lb a JS B o B •1 .£oo P. 3 ■3" ;oc U CO o o s -- a, 9 o o 01 ^<^ B •" Q •£? -^ <*5 o> O 0> O iC -M CO ■-< ej «o to o e o to o c5 no 00 o o 00 00 s o u Ah « >, a a m a. O o a 1-1 ea -^ H « * ® Ph O 00 CO o» C5 05 3 1I< CO <7> 00 CO o ou to r« s s s CO iM O o o •A OS O 30 I-- «o to — o ti co" lo" CC 05 O CO CO ■«»< 00_ Sew « cj O S rii'l!hirr. I'nl.lir dt'l.t .-£1,272,591 Railways fwctrkin^ i'.\- penses 1.304.400 Otliei puhlic. works 887,827 I'o.st and telei^raj ihs 578,451 Crown Lands, .<:r 179,222 I'uldic Instruction t;70,85() Cliaritalilc Institutions... 20(t,;581 .I.idirialaiid L-al 204,135 rolic- and (iaols 2!)4,703 Customs, H rlM.is, Sa: 120,402 Dof.'uce 158,047 Otiier exiH'nditnre 008,208 Total i; 0,065,803 ITiat is to say, that the revenue was 832.720,593.02 and the expenditure $32 390,094.18, which leaves a surplus of receipts to the extent of #330,499.44, 62 Victoria has a 3,119,lG4 or $100,953,137.04 of wliich ^£25,404,847 or $123,467,556.42 was borrowed for the construction of railways, i;5,004,791 for water works, i;i.l03,557 for state school buildings and jei,603,969 for other puldio works. All but li million of the puldic debt was borntwed in London. The estiniated total value of the rateable property of the colony in 1886 was jei25,878,748 or $611,770,715.28 and the annual value .£9,621,135 or upwards of $45,000,000. \ if 63 (nnOUI.AR URPERBKD TO OS PAGE IT) PROVINCE OF QUEBEC Loan under Authority of the Act 50 Vic, Cap. 3, tor $3,500,00. Debentures to he in amounts not less than S500, or the equivalent in Sterling or Francs, to hear interest at a rate not exceeding 4 per cent per annum, payable half-yearly on the first daijs vf Januarg and July of each year, Tim date of the issue of the Debentures to be fixed by the Lieutenant- Governor in Council The Debentures to be redeemable i n 30 or 40 years (as may bs agreed upon). The Honorable the Treasurer of the Province is prepared to receive, up to the Ist Auizust, 1887, offers of net amounts, free of all commissions, charges and stamps, for the wliole amount of this loan on any of tlie following conditions : 1. For an issue at :'>l per cent interest i)ayal)lc semi-annually. Debentures to be lodged in a. 15ank in London and to be delivered on payment of tlie same. Par of Exchange (iU per cent) to l»e guaranteed for the IHlls ihawn in ]jnyment, 2. For an issut- at 4 pijr cent interest, conditions to b<> the same as are applicable to the :^ per cent issue mentioned in clause 1. 'A. For an issue at ol per cent interest, the Delientures to be h)dged in a Eank at Quebec or Montreal ane delivered on imyment in currency of Canaihi. 4, For an issue at 4 per cent interest. Conditions tlie siunc ns mentioned for 3| per cent issue in clause '^, .". The Honorable the Treasure!' will also c(jnsider oilers stating the rate of commission, including all charges, at which the jiarty olfei'lng would be prepared to tloat the loan bearing either iV^ or 4 per cent interest. 0. The Honorable the Treasurer reserves ti> himscdf the right of rejecting all offers. TllEASURY DEI'AUTMKNT, Quebec, oth July, 18B7,