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MACPHERSON, SfXATOh- OF CI X.I PA. DELIVERED IN THE SENATE, (/ITAWA, DUlllNC; THE SESSION 0¥ 1877. h With Introductorj' Reflections, addressed to his former Constituents, the Electors of North Simcoe, Grey and Bruce. " ?iio situation 'of this country is alarminff enougix to roixse the " attention of every man vrho pretends to a oonoern for tlie " country's welfare." Junius. SECOND EDITION. TO A' OX TO: Tiii M ui, Pkini:-,'.; am* Pi ci.i^hing Companv (Limi i-k!)), 1S77. ADVBRTI8EMEMT. THE DAILY MAIL IS PUBLISHED EVERY MORNING (SUNDAYS EXCEPTED), BV THK MAIL PRINTING AND PUBLISHING COMPANY (I^IMITKID), 8TJBS0BZ7TZ02V FBZCB, SZZ DOLLAltS FSB AXHSHJU. Sent to Subscribers to any Post Office in the Doniiniuii, postage ;>repaid, on receipt of sul)scription price. SINGLE COPIES, - - THREE CENTS. TO ADVERTISERS. The rale for Transient Advertisements is Ten Cents per line. 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Gentlemen, — At the request of members of both Houses of Parliament, I am induced to publish, in pamphlet form, the speeches delivered by me in the Senate during last Session upon the state of the Dominion, and especially upon the increase of that p] the other and higher qualities he possessed, he would take no step without] due deliberation, and, especially, would not commit the country to engage menls inconsistent with its perfect fmancial safety, or whiih would recjuire tluj im|>ositi(>n of new taxes upon the j)eople. With resf)ect to Mr. Ml.ikc, for a long time I looked upon him as one from whom Canada had much to hope. He had inherited a name and station ; was endowed with talents of a very high ord(;r ; he had had the opportunity of cuiti vating those talents, aided by the highest educational advantagcs,and his studies were guided as were those of few men in this country. He stepped, it may be said, at one stride, from the law-student's desk to a high place in the first rank of his profession, and then rapidly rose to distinction and fortune. He entered public life while still a young man. and displayed rare aptitude for its work. He professed the loftiest and purest patriotism. His denunciations of political corruption, especially of anything savouring of coalition (which he stigmatized as corruption in its most obnoxious form), are among the most eloquent utter- ances ever delivered in Canada. Self seeking and meanness he denounced with withering s< om. Who could doubt that Canada had much to hope from so highly gifted a son ? Mr. Blake entered public life when many of the active public men of the day- who have sinc;c p.issed .away — were descending in the vale of 3'ears. I cronfess that I ])laced implicit trust in all Mr. Blake's early professions — I believe, even now, they were made, at the time, in all sincerity. I cannot imagine, cin umstanc:ed as he wa.s, that he could have had any moti\e for entering the Covcrnment, other than x pure desire to serve his country. It is true there were incidents connected with the overthrow of the Government of the late honest Sandfield Macdonald, that surprised and startled the observing and thinking among the friends and admirers of Mr. Blake. His share in that episode was, however, forgotten, and he retained the high place he had won with the general public. When Mr. Mackenzie and Mr. Blake became the leaders in the Govern- ment of the Dominion — although some of the means by which they attained power were of a character that can never receive the approval of honourable men, but will be regarded as more and more unfortunate as time carries us away further from the events — still, I say, when Mr. Mackenzie and Mr. Blake became the leaders of the new Government in 1873, the feeling in the country was almost universal that their administration would be con- ducted upon the principles of political purity, departmental retrenchment, anci financial prudence which they had for so many years persistently and eloquently professed. instinct. | fe| tl>f head would nnd it was witi: >untry was about Iving enormous in addition u, no step without ^try to engage )uld ie(iuire tlu POLITHAI. im as one from nd station; was irtunity of cuiti ,and his studies PPed, it may he n the first rank -• He entered e for its work, ons of political lie stigmati/ed eloquent utter- he denounced 1 to hope from many of the :re descending 'J Mr. Blake's e time, in all ould have had lesire to serve hrow of the urprised and hirers of Mr. i he retained the Govern- hey attained honourable time carries ckenzie and > the feeling uld be con- :hment, and 5tently and I shared in this opinion, and they had my independent Rup|»ort, until I irame sarisfied that they wore violating the pledgCK of purity, reform and (momy which, when in Opjiosition, they had given to the people. (!;uiada is difficult to govern. The variety of races and creeds, the newly mad union of I'rovinces formerly separate and independent, the want homogeneity, unavoidable in a new country, where many of the inhabitants e immigrants of ( omparafivcly recent arrival, ;irc among the most apparent urces of dittirulty in the- administration oi affairs, and much allowance ould be made for the (lovcrnment. I made great allowance for the (rovormncnl ol Mr. Mackenzie. could not Imi rcgrci ihe early retirement from the Cabinet of some its ablest members, to oct iipy high and permanent offices. I know it is iftii ult, under our institutions, tor'oid such in< idcnts, but it is disappointing see men who have devoted m;ir\ years to entreating the peo|)le to give them n opportunity to govern bettei, if not to save, the country, soon after u;h i»pportunity is affoulcd them, retiring to i>v.'rmancnt office; useful and igh othce, no doubt, l)ut for which other men mighty have been found e(]ual, ijile ripe statesmen are a Iw.iys scarce. When .\Ir. Dorion retired il was of 3urse impossible to replace iiim in the Cabinet with a statesman of equal »;perience, from the I'rovint c ol Quebe« . Mr. Blake, after ;i brief pcrioil of retirement, rejoined the (lovernment, suminjji the portfolio of Minister of J u«jtice : nnd eventually Mr. Caiichon ecame the colleague of Messrs. Mackon/ic and Blake. From that time the overnment has been properly known as the Mackenzie-Cauchon Coalition. I believe the formaticm of this Coalition was the most severe blow ever ifli«:teii i;pon the moral sense ol" the people of this Dominion, and especially f Ontario: for not only w.«s Mr. Cauchon known to them as one whose titroduction into the Ciovernment rendered il unquestionably what they had leen taught by Messr>. Mackenzie and Hiake to abhor — a Conlition — but Ar. ('auchon. politiojdly and personally, had been held \\\) to public exe- ratiiin by the organs of the present (iovernment. 1 shall not enquire rhether'this «as deserved, but I may say without fear of successful contra- liction- even if he is as blai k ;is he wns pninted by his present friends — that, ompared with others of Messrs. Mackenzie and Blake's colleagues, Mr. auchon is in intellect a giani ;iiul in virtue immaculate. If Mr. Blake's professions were sincere in tie past, his intimate association nth some of those who are his present ( olleagues. must be to him a very byss f.. political degradation. And why has he allowed himself to be thus ragged down? Mr. Hlake's /»>v.c//\'y in the country four years ago was so great, nd his services in the (Government so indispensable to his party — as they are till- -that Mr. Mackenzie and he could have demanded the support of their ollowers in the fulfilment of their life-long pledges. He should have said, in (feet, to the self-seeking and unscrri>ulous, in words of burning eloquence uch as I cannot command : — " Mr. Mackenzie and myself are true men. * We intend, in governing this country, to redeem the pledges we gave to the f <5 INTRODUCTORY REKI Kf TIONS. " people, and of which you were the witnesses. Unless you will support arliam " in doing this we shall resign the reins of (lovemment to other hands, b *' we shall retain our self respect and the respect of all right-thinking mc " and without these we should indeed be abject, and could render our count *^ but poor and halting service." Can it be doubted, had he addressed in this spirit, and in the mann of which he is so accomplished a master, the great majority which w returned to the House of Commons to support the Government, that th majority would have rallied to the support of their leaders ? If there 1 any doubt, where is the patriotism and political morality of the party power ? In the intimate association that must necessarily subsist among the mer bers of a party carrying on the Ciovernment, it is impossible that a few, even one, can for any length of time remain bciler oi puiei lliuu ilie oiiici One of two things must occur if they continue in association ; either t unselfish, the patriotic, the pure, if but one, will leaven the mass, lift up and place it on a level with himself, or the mass will draw him down their own level. The latter unfortunately appears to have been the fate of Messrs. Mjh kenzie and Blake. It is to be deplored, in the interests of the count that they should have been guilty of political recreancy. They have struck blow at the purity of public life, and at the morale of the whole Commonwealtl from which it cannot recover during the present generation. In the <:ase, as in all like cases, the first downward step was irretrievable and fatal their subsequent descent, until they landed in the disgraceful scandals of tli session just closed, was rapid. Mr. Mackenzie's political tergiversation is matter for profound regret, indij eating as it does a disregard for solemn pledges on the part of one the loudest professors of political purity whom the country has produce It was begun, too, at a time, I may say, when he revelled in the plenitude power, receiving the support of the people and their representatives with ar| unanimity never before enjoyed by a Prime Minister of Canada. Mr^ Mackenzie, therefore, cannot urge in extenuation of his backsliding even tlit poor plea of weakness. Mr. Blake was looked upon as the young Bayard among the public merj of Canada, to whom office would be a burden only to be undertake and endured for the opportunities it would afford him of serving his country, and to be relinquished the moment it became a question between offic on the one hand, and consistency, self-respect and honor on the other: It was supposed that his only ambition was to serve his country an merit the approval and confidence of his countrymen. Mr. Blake's higl character and known independence gave him the power, had he chosen ti exercise it, not only to frown down all incipient self-seeking and raeannes! among the greedy of his supporters, but to prevent, or at least stop whei discovered, flagrant and scandalous violations of the Independence oi will support ther hands, b it-thinking mc »der our count in the manni POLITICAL. 7 arliament Act. Such violations were charged in .some cases against leading embers of his party, and in connection with the other oases the Ctovem- ent itself is more seriously compromised than any non-official member of arliament, as in all cases of real turpitude the Government was necessarily party. But Mr. Blake did not so exercise his power. Had such scandals as were brought to light last session been established ority which w^ur or five years ago- -that the Speaker of the House of Commons, the iment, that th ? If there 1 of the party biter in that House between the Government and the Opposition, on hose impartiality the minority is dependent for justice and fair play, the ardian of the rights and privileges of the Commons — had it, I say, en established four or five years ago that the Speake*- had been for four ssions of Parliament a Government contractor, and, in that capacity, d received large sums of public money in violation of the Independence ParHanient Act. would not Mr. Blake have made the country resound, d very properly, with his fervid eloquence in denunciation of so brazen and rrupt a scandal ? When it was discovered that the Speaker of the House of Commons and any members of Parliament were involved in these scandals, what said r. Blake? No word of condemnation fell from his lips. How could essrs. Blake and Mackenzie condemn that in which they as members of the overnment were participators? It need not, however, surprise Mr, Blake if, the minds of those who mark his silence now, doubts arise of the sincerity his lofty-toned, but unjust and cruel, diatribes in 1871 against Colonel ray, then of New Brunswick. The scandals revealed last session were the grossest ever committed in Can- a — I do not except the Pacific Railway Scandal or any other. I need not tell u that I am no defender of what was done with respect to the Pacific Railway ntract in 1873. It is well known, however, to every man who has been a ember of Parliament, or a candidate, as well as to every elector in the coun- , that spending money at elections in those days was regarded as a i)ardon- le act of illegality. But, I .ask, would any one think of comparing in enormity ch expenditure with the scnndals unearthed last session ? Consider the iding even tlit fulminating scene in the House of Commons on the last day of the session, he Committee of Privileges and Elections deciding that the Speaker had the public merlfteen a Government contractor, had therefore vacated his seat, and reporting be undertakeiflheir decision to the House — but the Government preventing the considera- tig his countrySion of the report by its presentation being so timed as to be simultaneous between officew'th the summons of the Governor-General to the Prorogation. ''f'^H''ic! •NS. the public service. Was not this a rare and humbling exhibition of strainin| "PO^ef at a gnat and swallowing a camel ? her pr The Government were not only necessarily active participators in thesi ^^heni scandals, but, by the course they pursued in burking the inquiry and otherwise they compelled all their supj)orters in Parliament to become morally partici pators with them. When Messrs. Macken/ie and Blnke, who for so long a time professed t( keep vigilant wntch over the people's money, who arrogated to themselvci the places of 'I'ribunes of the i)eople. — when they proved not on\j faithless to their plwlges generally, hut jKirticipators in political offencei of the heinous rliaracter brought to light last session, it became the dutJ of every man who was in any position to do it, to call attention to then| and point out that those offences were in their nature more debasing, and ir their evil tendencies more wide spreading, than any previously known to thiij country. It is painful to me lo write in these terms of the Governmiit of ouij country, and especially of Messrs. Mackenzie and Blake, two gentlemen foiW^ie pc whom I had entertained great respect and in whose professions of political^PPOS( integrity I at one time placed confidence. It was not pleasant to dis| cover tiiat 1 had been deceived by them, but so it was, and I declared iij from my ])lace in the Senate more than a year ago. Many were decei\'ed as I was, and I know that wh.U, I am now proclaiming, as from the house-tops^ thousands are confessing at rlVtir firesides in friendly interchange of confidence with their neighbours. . When men .set themselves up as leaders of their fellow-men, basing theii| claims mainly upon their ])retended higher political morality and purity, a^ Messrs. Mackenzie and IJlake did, and when it is discovered that the chietl difference between them and those they assailed was in the garment thcl assailers wore — the cloak of political hyijocri.sy -it becomes a duty to exhibit! them to the jieople in their true character. Mr. Mackenzie and Mr. Blake took their stand, as it were, in the political! market-places and thanked hea\en that they were not like other men,especially' not like that vile offender Cauchoii : and when he came between the wind andi^ their purity, the\'. with averted and upturned heads, went away, saying that! his sins were " rank and smelt to heaven." But they are now the coUeaguesj and bosom friends of Mr. Cauchon, and thus show that they are more guilt}[ than he, by, at least, one sin, — the odious sin "of hypocrisy. Again, we can picture them in the same market-places, beating their breasts] and, with real elocjuence, pouring out their expressions of gratitude that the) [ were not only better than mankind in general, but especially better than that] irreclaimable sinner, John A. Mac donald, who, in addition to habitually com- mitting all the sins forbidden by the Decalogue, was a " Political Coalitioni.st,"] an offence for which, according to their code, there was no pardon. Now. look at their own Government — a Coalition ! Yes, the most hetero- geneous and unprincipled Coalition that ever existed in this country, chiefly! ne professed t( to themselvc l*ol,iTi< Al. 9 on ofstrainini "POsed ol mtn who were brought together, and are kept together, I )y no' her principle than selfishness, the salaries and percjuisites of office. IVhen they were struggling for office. Sir Francis Hincks, in debate, described and otherwise ^^ V^^^Y ^s "an organized hypocrisy," and it would be diffic ult to characterize morally partici "^'"'^ appropriately and truthfully. After having been so deceived, will the )ple ever again plrPPOsed, but almost uncrilici/.ed, so overwhelming was their majority, so ten and dispirited was the Oj^position. Tney came into NS. ii barometer of the prosperity of the people. Four, five, and six years ago annual revenue invariably exceeded the most sanguine estimates of the tl Ministers of Finance ; now the revenue falls below the most cautiously pared estimates. Governments cannot increase in riches so long as governed are growing poorer. This is a truism which our (rovernment w( do well to lay to heart. The circumstances of the people are not such at present as to render j prospect of increased taxation agreeable ; but we shall have to bear increa taxation. The largely augmented expenditure of the present Governmd continued in the face of a diminishing revenue from the ordinary indin sources, must, I apprehend, render direct taxation an inevitable and e^ necessity. This is a matter that affects you closely, for if direct taxation to be resorted to, a land tax will in all probability be one of its features.* Now, while the country has been suffering as I have described — and no can say that the picture is overdrawn — several sessions of Parliament h| been held, each at a cost to the people of this Dominion of about Hundred Thousand Dollars. And what has Parliament done, or attem[ to do, to revive the languishing, the almost extinct industries of the country! to alleviate the existing dept-ession, or even to inspire the desponding witi ray of hope ? It has done nothing, and attempted nothing. On the contni the Government declared that it was not in the power nor was it the functj of the Government or of Parliament to alleviate by legislation the widesprJ suffering, and said, substantially, that the depression had been produd by overtrading, and could only be relieved by a wholesome contraction trade. . Is it then to be admitted that free and constitutional Go\ernments have iti in their power to do aught to advance the interests of the countries they goveij Is there no science in statesmanship ? Are Cabinet Ministers only Cashij to receive and disburse the Revenue, and Officers of the law to preserve peace ? If these are their only duties, our Ministers are too many in numl] and vastly over-paid. These lower funi:tions are all that our Government d fess to discharge, but I think there are much higher ones which they mi^ exercise with signal advantage to the country ; but they must see these latj ones before they can exercise them. If, in the opinion of the Government, Parliament could not, by legislaiid do anything calculated to revive the prosperity of the country, what did it gj to the people, during its last session of nearly three months, in exchange Six Hundred Thousand Dollars of their money? Few Acts of importar were passed, and the country would not have been much, if at all, the loseij it had had to wait for most of these for some years to come. The power and ingenuity of the Government seem to have been exhaust] * If direct taxation could be made to bear equitably upon the whole people of a couni it would be the most economical and best mode of raising revenue, but political economy have not yet devised a system of direct taxation at once equitable and ]>ractical)Ie. I'iiLlTUAL. II been exhaust florth to injure the character of Sir John Macdonald. I'his ajipears ave been the only jjolicy of last session, I can discover trace of no True, it was not ennobling to the actors nor calculated to benefit ountrj- or exalt its name at home or abroad. Happily for the credit of da, the.se efforts failed in their object. uch of the time of the Committee of Public Accounts of the House of mons was spent in what I think may be called the trial of Sir John donald. 'i'he Minister of Justice did not think it uriworth)- of his office to rise in that Committee (two-thirds, at least, of the members of h were his i)olitical supporters, ready to accept his reading of the law). to arraign and examine Sir John Macdonald, his jjredecessor in office. aving misappropriated or s\)cnt without proper authority Six Thousand Hundred Dollars of the Secret Ser\ ice Fund. he whole proceeding was a cruel indignity oft'ered to that gentleman. pursuers should have remembered that he had been a Minister of Canada a quarter of a century, trusted by the people with the whole destinies of country — destinies which he had guided with great success, the people en- g unexampled prosperity, e\ er) intelligent and industrious man growing er and richer year by year, while it is well known that Sir John Macdonald the public service a poorer man than he entered it. is also known that the tinoluments received b) Cabinet Ministers now about one-half larger than were received by them during his time, except the last few months of his public service. desire to refer to another matter, one in which my own name came up. ing last summer a Royal Commission was issued, ostensibly to entjuire the affairs of the Northern Railway Company (strange to say after Parlia- t had commuted the debt owing by the Company), out, apparentl}, inly for the purpose of endeavoring to show that sums of money, in all o Thousand Five Hundred Dollars, subscribed by individual Directors of t Company to a Testimonial to Sir John Macdonald (of which I was asurer),and paid for them, bv the Company, could be made to appear b) 1 sophistry to belong to the Government. his inquiry was followed up by a Committee of the House of Commons. "ore which it was established that the Testimonial (set on foot when he was posed to be on his death-bed) was for the benefit of his wif- and family, that Sir Joltn did not know who an) of the contributors were. The object of the Government in all this must ha\ e been to manifest osteii- iously their jealous care, faithful guardianship, and sleepless watchfulness the people's money. If a scru[)ulous care of the people's money had aracterized their administration of public affairs through all its ramifications, : might admire their stern consistency, and their fidelity to their pledges retrenchment and economy. To assist you in determining whether their administration has been gu\ - ed by a proper consideration for the means and resources of the country, by that consideration which their pledges entitled the ])eople to expect. — I 12 INTBODyCTORY REFLECTIONS. will submit to you a few facts in respect to their mnnagement of some] the Public Works, beginning with the PACIFIC RAILWAY. The course of the (iovemment with respect to this great undertaking has bt extraordinary and unfortunate. They do not seem to have been governl by any settled policy or plan, and without these they rushed into large e\m diture, and committed the country to heavy engagements. They began, by constructing any part of the main line, but by giving Mr. A. B. Fosterl contract for what they called the (ieorgian Bay Branch of the Pacific Railw/ They did this without first surveying the country through which this Branj line was to run, and therefore without an estimate of its cost, cr evj knowing whether the undertaking could be carried out. When explore a great part of the countrj' was found to be a barren wilderness, impracj cable within any reasonable cost for a Railway on the line and of l\ curves and gradients specified in the contract. The project had to suspended, the contract cancelled, and One Hundred and Nine Thousan Dollars were paid to Mr. Foster, for which, so far as I can discover, the counti got very little value.* Why this Branch should have been placed undj contract so hastily and recklessly, requires a fuller explanation than Mr. Mai kenzie has yet given. One thing is certain, the interests of the Dominion djf not call for and were not consulted in this transaction. • Then, with respect to the Main Line, the Government saw fit to commence! on the section between Thunder Bay — or rather between Fort William on tl^| bank of the Kaminstiquia, six or eight miles from Thunder Bay, on L^\ .Superior — and the Red River, a distance of 410 miles, through a w| (lerness, no part of which, worth mentioning, according to the testimony Mr. Sandford Fleming, (^hief Engineer of the Railway, is fit for settlemeiij Mr. Fleming's evidence upon the subject is in full accord with that of J other persons who have visited the region. It abounds in small lakes, .luJ mires and rock. Through a considerable part of the country the constructiol of the Railway will be difficult and costly, there being much rock cutting an] some tunnelling. When finished it will only be a summer road, open for fi\l months in the year, and run at an enormous loss to the country. Long beforl it is finished the American line from Duluth to Pembina, on the frontier Manitoba, is certain to be completed, and will be open v/a St. Paul all th| year round. • This item of One Hundred and Nine Thousand Dollars stands in the PulJic Accouiitj as stated above, but it was explained in Parliament that Forty-one Thousand Dollars \va the amount paid to Mr. Foster on account of his contract for the Georgian Bay Branchl and that the balance, Sixty-eight Thousand Dollars, was an advance made to him upol Iron Kails, under his contract with the Canada Central Railway Company for building thj line— subsidized by the Government— to connect the (ieorgian Bay Branch with the CanadJ Oentral Railway. These Iron Rails were valued at Forty-eight Dollars per ton, and three] fourths thereof, or Thirty-six Dollars per ton, were advanced upon theni Sied Kails coulj have b*ien bought deliverable this Spring at Montreal at Thirty-six Dollars per ton. FOKT FKANCIS l^oCK. VI ment of some [The Pacific Railway is under contract from Fort William westwards English River, a distance of 113 miles, and from Selkirk, on the Red /er eastwards to Keewatin (Rat Portage) 114 miles, including the costly ^tion, number fifteen. At Port Savanne, 73 miles \ve:jt of Fort William Railway will connect by the Sa\anne River with the waters of Lac des |lle Lacs, and of other and smaller lakes, and through them with Rainy [ke and River, and the Lake of the Woods. It has been re])resented that the Railway will thus connect with, and open trade and commerce, upwards of 300 miles of water communication, ''ou can judge of its value as an. avenue for trade and commerce [en I tell you that the difference in level between Lac des rvlille Lacs and Lake of the Woods is about four hundred and thirty feet, and is overcome I nine portages. The most inexi)erienced in such matters will at once see that vill be utterly impossible to transport iiierchandi/.e over this route ; and yet Is is the route the Government spoke of employing for transporting rails other materials for the Pacific Railway from Port Savanne westerly. The ^vernment does not appear to have known more of this country, when it mged into heavy expenditure in it, than it did of the region through which :ontracted for the building of the Georgian Bay Branch. The next work upon which I will say a few words is FORT FRANCIS LOCK. IVhen it was expected that the Pacific Railv.ay would follow pretty closely line of what is known as the Dawson route, that it would connect at [rgeon Falls with the waters of Rainy Lake and that the chief water ^tches (Rainy Lake, Rainy River, and the Lake (jf the Woods) would be lized for many years as part of the communication to the North-West, I lid understand the policy of constructing Locks at Fort Francis, as, with ker imjjrovements, they would make navigable in one "stretch" the dis- kce from Sturgeon Falls to the north-west angle of the Lake of the Woods, hundred and seventy-seven (177) miles, and render unnecessary for a k' long time the construction of about the same number of miles of costly ^h\'ay. But instead of carrying the Railway along the Dawson or southern ite, the Engineer deemed it better to locate it upon a line which removes ibout one hundred (loo) miles north of Fort Francis, so that the one under- dng has no possible connection with the other. Moreover the locating of Railway on the level of Lac des Mille Lacs renders the utilization of the Iter stretcle.'s impossible, because it is separated from them by what is ictically an ins; perable natural obstacle— its altitude of four hundred (400) ^t above Rainy LL.ke. rrhe workii s. iort Francis, like the Georgian Bay Branch, were under- ^en without survey, and without estimate. They cost, up to the 20th kcember last. One Hundred and Eight Thousand Six Hundred and Seventy- |ir Dollars, ;tnd only a small proportion of the work is pefformed. low . much . has been expended since upon them, I ha' e not the means 14 INTHODUCTORY RKFLECTIONS. of knowing, but when surveys and estimates have been obtained, it wi| be for the Government to determine whether to proceed with them, or dii continue them and lei the countrj- lose the outlay, as in the case of th Georgian 13ay Branch, Strange to say, the expenditure is charged again^ the Pacific Railway. If these works should be proceeded with, the country will be committed to] further large exi)enditure for the improvement of Rainy River. This river the Boundary Line between the Dominion and the United States. It, thertj fore, would seem but reasonable and just that expenditure made in improving this international communication should be shared by both countries in th^ proportions in which thty are interested. Now that Canada is building railway through that country, her interest in the improvement of those "watel stretches" is very small. The inhabitants of Minnesota are the people wlii will be chiefly benefitted by the impro\ement of Rainy Lake and Rain| River, including the lock at I'ort Francis. I regard our expeniliture there unnecessary and indefensible. But surely the whole expenditure between Lake Suj^erior and the Re^ River is premature and unwise ! That section of the Railway will cost no| less than Twenty Millions of Dollars ; the interest will be One Million Dollars a year, nnd with the loss on working the road (which I shall no| venture to estimate) will amount to an enormous sum, to be borne bij the tax-payers of this Dominion. I ma\ say, my own opinion has alwayiij been that we should have been content, for a time, to use the United States lines for our all-rail-route to Manitoba, and begin our Pacific! Railway at Pembina, thence to Winnipeg, and on through Manitobi and the North West, combining with its construction a comprehend sive and attractive scheme of Immigration, under which Immigrant^ would be assured, of employment and land — employment first, and lantfl afterwards. The lands retained by the Government in the North West,| owing to the settlement of adjoining lands would have been enhanced in valueJ and their sale would have provided funds to aid in extending the railway a> required without overburdening the Dominion Exchequer. In this way tht'^ Canadian Pacific Railway east of the Rocky Mountains could have been buili as fast as required, fjor very little money, and our prairie country would havel become tjuickly peopled. A similar course, as far as adaptable to British Columbia, might have been jiursued in that Province ; and when the Govern-^ ment decided to build the road as a Public Work no reasonable objection could be urged against this i)olicy. Had it been followed, the Dominion, from the Atlantic to the Pacific, would have been more prosperous than it is to-day We should have been free from the heavy engagements that weigh upon usj and free also from the financial peril that stares us in the face — imminenti if not inevitable. Our expenditure to this time upon the Railway would havt j been comparatively small, and would increase only as might be convenient, for it would be subject to our own control. As it is, the outlay in connection with the Pacific Railway to the 30th Juno. F(Un WILLIAM ON TIIK KAMLNSTl(,trL\. 1.-. >btained, it wiBjG, (ju cording to the Public Accounts) amounts to the large sum of Six Mil- th them, or diAns Two Hundred and l-'ifty-four Thousand Two Hundred and Eighty the case of thiol lars. This includes the sum of Kifty-one Thousand Kour Hundred and :harged againflinetcen Dollars paid for the station ground at 'b KORT WII-LIAM ON THK KAMINSTIQUIA, ;ir . t\(lusi\c of streets, about seventy-five acres of land of the town plot of )rt IVilliam (a paper town in the wilderness) which the Government bought )m their [)olitit:al friends at the rate of about Six Hundred Dollars per acre 1 kcluded in the sum of Kifty-one 'I'housand Kour Hundred and Nineteen [ollars, is Five Thousand and Twenty-nine Dollars and 'I'hirty-six Cents, paid the (lovernment for an unfinished building, said to have been intended for Ihotel. I have seen no exi)lanatit»n ul this transac tion that justifies it or removes from grave suspicion of jobbery. The subject was referred to a Committee the Senate, but too near the close of the Session to permit the completion the impiiry. The evidence of ^^r. Fleming, Chief Engineer, and of Mr. [urdock. the locating Engineer at that point, was obtained. The former itified that tlie terminus was settled in conference with Mr. Mackenzie. jid that he (Mr. Fleming) was much surprised at the price paid for the id. Mr. Murdock testified that he located the line under instructions )m the Department of I'ublic ^\'orks, notwithstanding that he had recom- lended a point nearer to the mouth of the river for the terminus, \yhere the [cilities would l)e greater and where a farm was offered for terminal grounds $75 per acre. What is already known in connection with the selection of the terminus on le Kaministicfuia renders a searching en([uiiy into the whole matter abso- Itely necessary. From all the information 1 ha\e been able to obtain, my own opinion at resent is, that this terminus of the Pacific Railway cannot permanently remain |)on the grountl which has been bought and jiaid for, but that it must removed either nearer to the mouth of the Kaministicjuia, or to Prince irth'ir's Landing. It undoubtedly re([uires great vigilance on the part of the (lovernment to iiotect the ])ublic interests when large expenditure is in progress, such as lat u])on the Pacific Railway survey, extending as it does across a great part the continent, which, between Manitoba and British Columbia, is almost itirely uninhabited. Persons under the title of Purveyors are employed, ^ho seem to traverse the whole country between Lake Superior and the pacific Ocean, disbursing j^ublic money for every conceivable purpose. It ly be a necessary but it certainly is an objectionable system, as efficient U|)ervision or audit of the expenditure would .seem impossible. The )llowii:^!; large amounts were expended in this way during the fiscal year \ding on the 30th June last : 10 INTUOJn (;i\»HY IIKFJ-EC'IIONS. At Prince Arthur's Landing on the requisition of N, Bethune, Purveyor $158,891 Paid in Manitoba by chetiues drawn by Thos. Nixon, l'ur\ eyor. 1 94,537 Paid in British Columbia by cheques drawn by J. Robson, Purveyor 322.888 'I'hen for account of St. Francis I,ock there are disbursements byN. Bethune 14,2 itr Same account, by John Logan • 39.ivrt Various supplies from other parties, chiefly in Toronto 23, '^i, 2 fl Purveyor Thomas Nixon is probably personally known to many of you wt reside in the Township of Proton. These introductory observations have extended to much greater length thai I intended when I took up my pen, but I must not close them without alluij ing to that colossal blunder of the (jovernment, the purchase years befpij they were wanted of FIFTY THOUSAND TONS OF STEEL RAILS. I think it will be admitted that (jovernmcnts have no business to specula^ with the public funds ; that is, they have no right to spend the people's monu before it is absolutely necessary to do so. It is no part of their duty to foreca| the course of the markets for steel rails, or any other commodity, which tl.^ country may want at some future day. The members of our Government a; not supposed to have had special training for such work. If they had ha^ they would not have bought 50,000 tons of steel rails in a falling markij when the rails were not required, and on the advice of persons interested selling. Mr. Mackenzie says he acted on the advice of hardware merchan;| and agents of iron masters — the very men who were interested in raakiii| sales, especially in a falling market. Mr. Mackenzie also says he consulted Mr. Sandford Fleming, the Chiij| Engineer. Mr. Fleming has had great experience in his profession, btj speculating in steel is not in the line of his profession, and I am sure Mj Fleming does not pretend to have any skill in judging of the probable coursj of markets. It is two years and a half since the Steel Rails were bought ; no portion them was required for the Pacific Railway until this summer, and only small quantity will be wanted during this season. Had the Government noj ordered these rails till last autumn, which was as early as they need have done] they could have contracted for the delivery of 50,000 tons at Montreal fo| One Million One Hundred and Thirty-eight Thousand Nine Hundred DollarJ less than the country has paid for that quantity. But if the Government had waited until last fall the order would not hav^ been for 50,000 tons but for enough only for one year's requirements — prc^ bably 10,000 or 12,000 tons, at Thirty-six Dollars per ton, costing a^ Montreal Four Hundred and Thirty^two Thousand Dollars, or say, deliv;) €red at destination, Five Hundred Thousand Dollars. This is all that neeo HTEEL HAILS. 17 • $158,891 r. '94,537 1, 322,888 s 14,2 1 tr 39,Ive^ 23,>l2 lany of you W Ive been disbursed for steel rails, for the Pacific Railway, to the close of this iar. But, instead of this amount, the Government has actually disbursed cost, charges, and interest — upwards of Three Millions Five Hundred [housand Dollars, being Three Millions and odd Dollars more than they need ive disbursed, and which sum, now represented by piles of corroding steel \\h, might have been and ought to have been still at the credit of the country (ith its bankers, where it would be convenient to have it at present. On a subsequent page will be found a statement of the transaction. It ^ows that the country, up to the 30th June last, had lost by it more than a [illion and a Half of Dollars; and further payments have been made which ;re not included in the Public Accounts of last year. Is not iliis appalling ? Consider what might be accomplished in this country lith One Million Five Hundred Thousand Dollars judiciously expended, and lat of this lost sum, no less than One Million One Hundred and Twenty- irec Thousand One Hundred and Fifty Dollars were paid away needlessly the Government, to English ironmasters. The loss to this date is not limited to the amount shewn above. But in msequence of having the rails on hand, the Government despatched five lousandtons to Vancouver Island, without waiting to see whether the Bill to ^ovide for the construction of the Esquimault and Namaimo Railway would iss. They would not have done this, had the rails not been on hand. The ill did not pass. The rails are now lying on Vancouver Island corroding, id no man can say when they will be required. They represent in cost id freight not less than Three Hundred and Twenty Thousand Dollars. There is still another and a worse case. The rails sent to Vancouver Island, |though deteriorating, are the property of the country ; but the Government IS taken authority to make an absolute gift of about 4,000 tons of these rails Nova Scotia for a private Company. When it was discovered that the Steel |;ails would not be wanted for the Pacific Railway for years after they were irchased, about eleven thousand tons were sent to Halifax for use upon ^e Intercolonial and other Government Railways in the Maritime Provinces. me of these, the TRURO AND PICTOU RAILWAY, i about 52 miles long, connecting at Truro with the Intercolonial Railway, and |t Pictou with the Gulf of St. Lawrence. To aid in extending Railway com- munication into the eastern part of Nova Scotia, the Government agreed to ransfer the Truro and Pictou Line, by .way of bonus, to any Company that rould agree to continue it from a point near Pictou to the Strait of Can so. !'he negotiations were commenced in the time of the late and concluded by le present Government. In 1874 the House of Commons passed a resolution authorizing the government to conclude the transaction, and an Act was passed last ;ssion to give effect to it. When this Bill was passing through the IN iNri:»ti)r(Tni!v hkii.iictions. I House of Connnons. the TIoiisc was not informed by the (Jover mcnt, as it ought to have been, that sul)se<|ucnt to the House's authd] w.'wVti the transfer of this Raihvay. a very large sum of money had bet] expended upon it. When the Hill came to the Senate, no ((mimunic tionofthis expenditure was made to that House. Attention was called outlays amounting; to Seventy-seven 'I'housantl Three Hundred .ind Sixt\)[ nine Dollars for new work-, at I'ictou and elsewhere upon the line; surpri> was expressed that they should have been incurred after the (lovernmcr had authority to transfer the Railway to a private Company. And this Ic^j to the astoundin},' discovery that the (lovqrnment had actually re-laid 41 miles of the line with steel ! which must have taken, including sidini.; j about 4,000 tons of rails. The excuse ftffereil by the (lovernment for this unauthorized, and, untkj the circumstances, extraordinary expenditure, was that the Railway had to ij maintained, that the track was wearing out and had to be relaid. But doo any one suppose that it would have been relaid with steel had it not been t< the unfortunate pun hase of steel rails? The (iovernment had them on haiij and were anxious to get them out of sight, and to help to do this actually gave away four thousand tons, which cost about Two Hundred and Twent)J five Thousand Dollars, to a private Company. The road had been open only a few years, and, considering its light tratiti(j the track cannot have been in very bati order. Whatever renewals were necci sary should have been in iron rails, of which a large cpiantity was removtl on the Intercolonial, to be replaced by steel, i'he iron so removed wa] nominally lent, but I presume really given, to ])rivate C!ompanies who ari building Branch Railways to connect with the Intercolonial. If these inn rails are sufficientl} good to lay upon new roads, surely they were gootj enough for repairing a Railway which was about to be given away. It was said by the GovernmeHt when the Bill was before Parliament that thl Railway had very little traffic, but certainly the expenditure upon it would leniij one to suppose that the traffic must be considerable and increasing. After it:: transfer had been authorized the Clovernment must have expended upon I Sor new works, relaying the track wrth Steel Rails, (Jcc, Three Hundrcil aiv Twenty-five Thousand Dollars, an addition to the gift contemplated b< the House of Commons, wholly unauthorized. What can be said, not ii| justification, but in extenuation of thus giving away public property withoil the knowledge of Parliament ? The Government Steel R.til adventure in all its unfortunate phases, d which the Truro and Pictou is* not the least remarkable, is so extrrJ ordinary— was embarked in so unnecessarily and unwisely, conducted A recklessly, if not corruptly, and has been so dire in its consequences tj the country — that it would be altogether incredible were not. the facts aivj resHilts, as they are, absolutely demonstrated. The transactions which I have brought under your notice involve the absq lute waste of Millions of the public money'; and the men who are directji KIXANi I.VL. VJ Sponsible for ihis waste are ihc same men wliom the iteoi>le— placing? von- |ence in their ability as statesmen an'l administrators, i»utting faith in the j( erity of their professions of purity anU in their pr«)mises of retrenchment Id economy— raised to supreme power, and to whose supi»ort in the House ot )mn)()ns the people sent a majority so large as to render the sway oftheOov- mient altogether uncjuestioncd in the Dominion. Absolute power tarries with [weighty responsibility. Tlie present (iovernmenl has wielded the power for prly four years. How has it disiharged the responsibility ? Traverse the )minion from Cape Breton to Vancouver Island, and enciuire how the jvernment has ac<|uitted itself of its duties; and the .inswer, from supporter ^d cpponent alike, will be an expression of disappointment -varying in em- jasis, of course, but always condemnatory. I'our sessions of the i)resent Parliament have been held, at a cost lo the jople of about Two and a Half .Millions of Dollars. Throughout all this iriod the control of the (iovernment has been absolute its majority in the louse of Commons being overwhelming, and tlie Senate not unfriendly. ^Vhoever will search the Statute Hooks of these four sessions will find that ^e legislation of importance to the Dominion has been almost infinitesimal, jd altogether incommensurate with its cost. I fear the (Iovernment will go on still increasing the expenditure, and that fficits will continue to roll up. Should the war now raging in l^urope (tend, money will certainly become dearer in England. 1 am not without )prehension that the construction of even the useful and most desirable of ie public works in progress may have to be retarded, if not suspended, id will thus, although representing a large outlay, be for a time of no tility, because unfinished. In times like the present, even if managed [ith prudence, our finances would give cause for anxiety ; managed as they re, the future is pregn.ant with peril. In the Senate, I gave it as my opinion lat Parliament should not rise without making better provision for the iture. It would have been wise- to have provided foi the existing deficit of Two Millions of Dollars than to wait until next session, when Parliament may ^ave to deal with two deficits, each i)robably of Two Millions. I regret to have to write thus of our public affairs. • But unless the facts Ire made known to the people, the evils will not be remedied, and there is a Numerous and influential class of men throughout the country interested in [oncealing the truth and profiting by the evils which prevail. I wish that less of the work of exposing the mis-government of our rulers »ad devolved upon me; but I cannot look on in silence, and see the ntal interests of the country compromised by those to whom its destinies ire entrusted. 1 hold that every Member of Parliament is charged with pie care of those interests, and that it is his imperative duty to give utter- mce to what he conscientiously believes is demanded in the public Welfare. I am, as you all know, one of the non-olificial class, having nothing to gain jy the rise and fill of Administrations; having no object to serve beyond that v 20 INTllODUCTORY REFLECTIONS. which I have in common with you and with every lover, as well as with everJ taxpayer, of Canada ; — interested only in the good name and fair fame of ouii country ; interested in the honest, efficient and economical administration oi|| public affairs; and, above all, because essential to the attainment of the others ; interested that our Ministers should be men worthy to constitute the Govern ment of Canada — men of high character and consistency, men of truth andj honour. To enable you to form a judgment for yourselves upon the increased < amount of our expenditure, especially the controllable portion of it, I submit i the facts to be found in the following pages, all of which have been extracted from official sources. ^ think you will agree with me that the exhibit is truly alarming — that the increase of our controllable expenditure is greatly in excess of the requirements of the public service, as well as far beyond the present means of our people. The increase of our public debt is also appalling, inasmuch as it is being incurred mainly for the construction of Works which will not only be unproductive, but the maintenance and working of which will be attended with heavy annual loss. I have brought under your notice evidence only of the larger acts of mal administiMtion and of the grosser cases of extravagance and worse than extravajT^ance that have been brought to light. How much remains to be- discovered time only can tell, and even time may not disclose all the evidence that exists of administrative incapacity, — of reckless extravagance — of absolute waste of the public money — of scandalous jobbery. The present Government have certainly made haste to impoverish the country and impaii its credit, and, simultaneously, have made havoc with the reputations of its members, while their pretensions to statesmanship and political purity have been utterly swept away. Less than four years ago, Messrs. Mackenzie and Blake, as the leaders of the new Government, may be said to have unfurled their banner, and to have inscribed upon it REFORM, RETRENCHMENT, ECONOMY, PURITY ! It was borne over the Dominion in triumph, amid the acclamations of the people. Four short years have more than sufficed to prove the hollowness of these lofty pretensions. ^ The proud inscription is effaced, and the banner itself is trailing in the dust. I have the honor to be. Gentlemen, Your very obedient Servant, D. L. MACPHERSON. H WATER STUK'K.HliS. 21 II as with ever lir fame of ou ministration oti It of the others te the Govern n of truth and the increased of it, I submit 3een extracted xhibit is truly eatly in excess d the present Iso appalling, ' Works which 1 ting of which r acts of mal i worse than emains to be close all the ctravagance— The present ry and impair itations of its 1 purity have he leaders of and to have TV —After the preceding pages were in type, I saw the official report of a debate on a motion of Mr. Kirkpatrick's, on the Fort Francis Lock. Mr. Mackenzie's speech on that occasion strikes me as being so extra- ordinary that I feel it my duty to bring it under your notice. On tlie 2ist February last, (vide official report of the House' of Com- ns) Mr. Mackenzie said : — " It (the Pacific Railway) touches at present ivest of the Lac des Mille Lacs, or rather, the Kaministiquia River («V., avanne River ? ) at a navigable point, a little beyond which the latter falls into tlie Lake. I^rom that point there is almost continuous tiain- s;ation with afeiv short portages on the ivay to Rat Portage, tlic crossing place \of tJic Pacific Railiaay, on Winnipeg River, with only one great obstacle, which could not be overcome in any ether way, than by constructing a Lock at Fort Francis. There are, as I stated roughly last night, two hundred and twenty-eight miles under contract between Lake Superior and Red River, of which one hundred and sixteen miles lie at the east end, or westward from Fort William. At about seventy miles from thence, we reach a point east of Lac des Mille Lacs, thereby coming into the best navigable system at a place much further west, than would have been obtainable if the first con- templated J inc had been followed out." It would be difficult in the same space to compress more of erroneous and isleading statement concerning the country spoken of, but not described, an is contained in the foregoing extract from Mr. Mackenzie's speech. I ve italicized its most important passages ; and unless it was intended to be eaningless, it foreshadowed enormous and useless expenditure. Mr. Mac- enzie, judging by the report of his speech, made light of the " few short ortages" between Lac des Mille Lacs and Rat Portage, — (Keewatin,) " the nly one great obstacle" being at Fort Francis, which he said would be over- ome by the construction of the Lock in progress at that point. Would the eader of Mr. Mackenzie's words suppose that the difference in level etween the waters of Lac des Mille Lacs and of the Winnipeg River at- eewatin (Rat Portage) is no less than four hundred and thirty feet? The ort Francis Lock will only overcome twenty-two feet of this fall : four and ed feet of it lie between Lac des Mille Lacs and Rainy Lake, and are, t present, overcome l)y eight portages. Evi^rything, therefore, that is traiis- orted over this route must be transhipped twicu at each of tliese eight )ortages, must be handled sixteen times between Lac des Mille Lacs and [Rainy Lake. Imagine Steel Rails and other heavy materials for the Pacific Ijiilway being thus transported— it cannot be done, and to speak of it as practicable is simply absurd. Mr. Mackenzie, you will observe, said that when the railway reaches Lac des Mille Lacs (Port Savanne) it will touch " the best navigable system " in that country. Tiiis is an inexplicable statement to fall from Mr. Mackenzie's lips. I shall not imj)ute intentional mis-statement to our Prime Minister, but will assume (what is scarcely less unpardonable because equally mis- leading) that Mr. Mnckenzie omitted to inform himself about the country -).) INTltoDlc TiiHV |{i;ri,i;< TloNS. i;l ■ whicli was the subject of debate on the 2Tst of February. His speech showl that while lie professed to describe it with minuteness he was altogetheijl unacquainted with its jn-incipal geographical featwres. Instead of speaking of Lac des Mille 1-acs as part of the "best navigably system," broken only by "a few short portages," Mr. Mackenzie, to have beerl accurate, should have described it as al-ake on the top of a hill, four hundrec^ and thirty feet above the " navigable system" which he proi)Osed to utilize. Mr. Mackenzie seems to regard this route as only temporary, for hc| proceeds to say : — " Those who choose to look at the map will observe that^ " the first line, which we hoped to take, went almost in a straight line from *' Kaministiquia Bridge to a place called Sturgeon Falls, this being au •' the head of a long arm of Rainy Lake, stretching north-eastward. Tha;^ '' route was found not to be impracticable, but expensive. The line, as thcj ** hon. gentleman says, was carried further to the northward, but two-thirds oi " that country, perhaps, consists of water, and, in the vicinity of Rainy Lake,; ^' the country, to the north in particular, is intersected by deep, wide channels,! *' which reach either the exact vicinity of the railway, or very near it, between| " Rat Portage, the crossing of the Winnipeg River, and the end of the easterns *' contract, a distance of one hundred and eighty miles — what we .may call the | ^' Central District of that region. j\'(> iiwticr with what speed the road may /'r| '•'■prosecuted, that part cannot be completed within four or Jive years ; and in tk " meantime, if this Lock is finished, as lam informed it will be, durin<^ the cominji ^ ■" season, ice will be able to send out steamers to Rat Portage and to the eastern " end of Rainy Lake during the season after next, and from that point to Lac dt> ■' Millc Lacs is a comparatively short distance, so that in a few years we will A ■' able to avail ourselves of these most magnificent loater stretches connecting t/h " tivo points which the railway would touch — east and west. 'i"he policy of the *' (Government from the first was to have the railway completed as straight as! *' possible, and in the meantime to utilize any portion of the water communi) '' cations ichich would connect the tiao points that ought to be reached bv ;-ailwa\^ *' — years before they could actually be connected by rail. This /s the cause luhf " it is of the utmost service to the Government in the construction of tJu railway \ •' to have the means of passing through these waters in the way L have indicated.'^ '^ especially ivith regard to the very heavy and cumbrous carriage of mils and " materials of that kind, which are to be taken either from the 7Cf"* or the east. "The cost of the carriage of rails from Duluth to Red River is Fifteen " Dollars per ton, three limes the amount of the cost of transporting them 1 '' from Montreal to Duluth. Jf the raiUvay is finished to Lac des Mille Lacs. '• and if the (Government, when tliat time may come, should be directly •' interested in carrying the other contract over the intermediate space to " which 1 have referred, ive expect ice could cany the rails at one half th( " present cost in consequence of the completion of that undertaking, as the traii- •' shipment would be very difficult and expensive over the small portages, and ''particularly at Fott Francis, while L believe that to take the materials from '| ■' Rid River east7vards would entail still more formidable expenditure. I make WATKH S'11!I:TC'U1:S. :i8 have indicated. these brief explanations in order that hon. gentlemen may see that ve have at ill events reasons which were satisfactory to tlie 1 )epartmcni and to the Liovernment for inducing us to come to the conclusion to prosecute this hvork." \ j.Mr. Mackenzie thus clearly announced it to he the intention of the )vernment to open unbroken navigation for steamers from Port Savanne (the ^Iway station for Lac des Mille Lacs) to Rat Portage, on the Winnipeg River, promised also to have it completed "in a few years," and " years before " railway is finished between the i)oints named. Can Mr. Mackenzie have ^en aware of the magnitude of the undertaking to whi( h he committed inself ? Is it possible that he did not know that to connect Rainy Lake with ic des Mille Lacs for the purposes of navigation, 400 feet, i)erpendicular, ive to be overcome? Did Mr. Mackenzie know that the work he spoke of bcomplishing in a " few years " and " years beibre " the railway is lompleted itween Port Savanne and Keewatin (Rat Portage) involved the construction canals through seven miles or more of rock and the building of forty locks, kch of ten feet lift ? jWhen declaring it to be the policy of the Government to carry out this ipendous undertaking, surely it was Mr. Mackenzie's duty to tell the country )w many millions it would cost to construct the canals and the forty locks quired to enable "steamers" irom Rainy Lake to ascend 400 feet to the top the hill whereon Lac des j\[ille Lacs reposes. U'hen the section of the Pacific Railwivy between Lake Superior and |e Red River is finished the proposed system of navigation, if it should [en exist, would l)e supe'seded by the Railway ; and the tolls from traffic )on it would not, at any time, ])ay the wages of the keepers of its forty kks. Indeed, Mr. Mackenzie seemed to regard it only as auxiliary to the lilding of a section of the Railway, a means for transjjorting the heavy Materials, — in short, to serve in the construction of the Railway as tempo- jiry works are made to serve in tlie erection of l)ridges and important lildings. The Pacific Railway, even if constructed in the most judicious and economical ianner, is a truly formidable undertaking for Canada ; but if it should be icessary, as auxiliary to its construction, to open U)) a system of artificial lavigation so stupendous as that between Rainy Lake and Lac des Mille Lacs fould be— carried out to correspond with the l-ort Lrancis Locks, -then it manifest th t the construction of the Railway, even of the 1-ake Superior iction, must be left to future generations. Mr. Mackenzie's project of navi- ition-improvement, in addition to the Railway through the wilderness, letween Lake Superior and the Red River, is of course out of the cpiestion; ]nd when the facts connected with it are understood, the project — if ever itertained — must be abandoned. When, on the 21st February last, Mr. Mackenzie announced that the rovernment intended to adhere to the policy (;f uiiliv.ing for years the 2i INTRODUCTORY REFLECTIONS. "water stretclies" between Port Savanne and Rat Portage, did he know that in consequence of the Government having sanctioned the northern — the actual — location of the Railway, the utilization of the water stretches had been rendered impossible except by an expenditure for Canals and Locks which, I am sure, Mr. Mackenzie would not advise ? Mr. Mackenzie seems not to have been aware of this fact on the 21st February. His speech throughout shows that he was at that time unacciuainted with the topography of the country. Mr. Mackenzie spoke of the Fort Francis Portage as being the "only one great obstacle" to navigation between Lac des Mille Lacs and Keewatin (Rat Portage) on the Winnipeg River, and referred to the " few short portages" between Lac des Mille Lacs and Rainy Lake as trifling obstacles to be easily overcome — while, in point of fact. Fort Francis Portage compared with some of the others is an insignificant obstacle. At the latter point the fall is only 22 feet, while at Brule Portage, French Portage, Pine and Deux Rivieres Portages, the portage between NequaquonandNameukan Lslffts, the falls respectively are, 47, 99, 124 and 72 feet; and, as I have before stated, the total fall from Lac des Mille Lacs to Rainy Lake is four hundred (400) feet. (See table on next page.) Had the P.ailway been located so as to touch the waters of Rainy Lake at Sturgeon Falls the "water stretches" from that point to the north-west angle of the Lake of the Woods, a distance of 177 miles, or to Keewatin (Rat Portage), about 200 miles, could have been utilized, and the construction of what Mr. Mackenzie calls the "Central District" of the Lake Superior section of the Railway (180 miles) might have been postponed for very many years. But, located where it is, the water stretches cannot be taken advantage of, and the two end sections of the Railway which are now being constructed will be utterly useless for business until they are connected by the Central section — until the all-rail-line from Lake Superior to the Red River is com- pleted. The continued prosecution of the works at Fort Francis after the necessity for them had ceased, in consequence of that point being no longer on the line of through communication, goes to establish that Mr. Macke'^^ie was not aware that he had shunted the Railway a long distance aside from the water stretches, ^nd had thereby defeated his own scheme — their utilization. I submit that I have put the only construction upon Mr. Mackenzie's speech of 2Tst February that is consistent with its having been spoken in good faith.* I think I have proved by Mr. Mackenzie's own words that at the time he sanctioned the location of the Railway he did not know the full =«on- sequences to the country of his decision. What is to be said of an Adminis- tration that decided a matter of such importance without the fullest comprehension of everything relating to it? Does not the action of the * The extent to which Mr. Mackenzie's speech on the Railway ami " water stretches " was cnlailated to mislead the general public is exemplified in the fact that it seems to have misled even tlie Globe newspaper. All the inaccuracies of the speech were reproduced and endorsed in a leading article in the Globe of 7th May last, entitled "Fort Francis Lock." CONCLUSION. 25 Crovemraent in this case help to explain how works like the Fort Francis Lock, the Georgian Bay Branch Railway and the Steel Rail speculation, were entered upon apparently from mere impulse, without the deliberation which the public interests demanded, and without policy, plan, survey, or estimate ? D. L. M, T.viu.E OK Distances and Levels between Lac des Mille Lacs, (Port Savanne> AND Lake ok the Woods. Compiled from the reports of S. f. Dawson, Esq., C. E. PORTAGES AND RAPIDS. Land Carriaoe. Miles. ; Chains. Baril Portage Brulo Portage Descent in Windegoostegoon r.akelets and stream French Portage I'ine and Deux Riviere Port- ages Island Portage and Kail, Stur- geon River Portage between Nequaquon Lake and Nemeukan Lake. Bare Portage Fort Francis Manitou Rapids Long Rapid 1 •6 21 I 6o 2 13 2 II • lO Difference in Le\el in feet. Rise 1.86 Fall 47.02 ' 9-50 ' 99-71 Total. 124.12 10.06 ■ 32.50 ! 72.00 8.55 I 22.88 , 2.50 ! 4.00 I 432.84 ,* Off 1.86 Difference of Level between Lac dcri Mille Laes and north-west angle of Lake of the Woods feet' 430.98 NAVIGABLE WATERS. 2 ".3 : as Savanne River and Lac desi Mille Lacs I 42 Baril Portage 84. Baril Lake Windegoostegoon Lakes 12 Little French Lake and Kaogassikok Lake ! 1 5 Sturgeon Lake and River Nequaquon Lake Nemeukan Lake Rainy Lake and River .... \ Rainy River and Lake ofi I the Woods Land Carriage. T'tal Miles 27 17 ID 46 120 304 Distance from North-west Angle to Keewatin about 30 Miles. t:i» ON r sipeech: OS THK INCREASED PUIM.K KXPHNDITIKK. I )KI,I\ KK !• I > IN IHE SKNAl K OTTAWA. ON MONDAY. AlUtll, l6l'H. DS77. 3a In pursuance of notice given by me, I beg to cull iitteiition to the increased public expenditure of tht Dominion, especially that ])ortion of it which is largely within the control of the Administration, and to in([uire of the Govern nient how it is proposed to restore the equilibrium between income and expen- diture? When I brought this matter before the Senate early in the session, i intended that that should be the only occasion this session on which I would trespass on the patience of the House on this subject. But as my statements wei"e received with a simple denial of their correc tness by the (lovernment, and the friends of the (lovernment, 1 felt called upon to go more thoroughly into the question of public expenditure than ( had previously done — not to satisfy myself of the correctness of the figures 1 had produced, for I had done that before, but to bring conclusive proof of their accuracy before the Senate. F>ut before entering ovi that bn«ii h of ni) subject, I shall say a few words upon a very important matter connected with our finances ; and if the state- ment to which I am about to rder can be substantiatetl it will be gratifying U) me, and I am sure to the House also. The statement to which I refer will be found in the speech of the Prime Minister, delivered on the Budget, on the 20th February, 1877, on page 176 of the //a //sort/ of the House of Clom- mi)ns. It is as follows : " I have shown that when they (the late Government) left office the ex- " penditure was at Twenty-four Tilillion Dollars. When they entered office, " the expenditure stood at Thirteen Million Dollars, and in the course of six *' years they increased the expenditure by Eleven Million Dollars. We have •' been in office three years, and have decreased the expenditure by One - Million and a Half Dollars. That is the difference between the two " Governments. A\'e have, moreover, made the most ample provision to " have all the public wants attended to. We have erected public •'buildings in different places, the buildings at Montreal. Toronto, and •' in this city having been almost entirely constructed during that period ; " and, further, we have effected the reduction of the estimates which were " left us when the hoii. gentlemen opposite resigned office. This is a true " statement. Any one who chooses to examine the Public Accounts will •• see for himself the real state of affairs." 1 28 PUBLIC EXPENDITURE. I did examine the Public Accounts, and did not find Mr. Mackenzie's state- ment borne out by them ; but, on the contrary, discovered several inaccuracies in it. The first is, that the public expenditure in 1873 was Twenty-four Mil lion Dollars, whereas it was only Twenty-tlfree Millions, Three Hundred and Sixteen Thousand Three Hundred and Sixteen Dollars. The late Government left office on the 7th November, 1873, so that the present Government had the administration of affairs, as nearly as possible, for two-thirds of that financial year, and their predecessors for one-third. It would have been but fair if the Premier, also, in making his statement, had explained this. It would have been but fair to hove compared the expenditure of the year preceding the last year of the late Government's incumbency of office, 1872-1873, with the yeaj the hon. gentleman referred to — 1868. If he had done this, the expenditure for the year ending the 30th June, 1873, would have been found to be Nine teen Million One Hundred and Seventy-four Thousand Six Hundred and Forty-seven Dollars, and for the year ending the 30th June, 1868, Thirteen Million Four Hundred and Eighty-six Thousand and Ninety-two Dollars- the difference between them being Five Million Six Hundred and Eighty eight Thousand Five Hundred and Fifty-five Dollars. But even taking the next year — the year which he did take, and which I think was straining the comparison very far — there was a great inaccuracy, considering the lips from which it fell. For the year ending the 30th June, 1874, the expenditure was Twenty-three Million Three Hundred and Sixteen Thousand Three Hundred and Sixteen Dollars — being a difference between the expenditure of that yeai and of the year ending the 30th June, 1868, of Nine Millions Eight Hundred and Thirty Thousand Two Hundred and Twenty-four. Dollars, instead of Eleven Millions Dollars, as the Premier had stated — an error of One Million One Hundred and Seventy Thousand Dollars, This was a very important inaccuracy in dealing with figures in a matter of this kind. It is true, we have of late got into the habit of dealing with large sums, but the hon. gentleman, in making a statenfent as the basis of an argument against his predecessors, ought to have been as nearly as possible accurate. The statement of the Premier was, therefore, unfair and unjust to his predecessors, and calculated also to mislead the country. The other inaccuracy in the statement of the Prime Minister was, that his Government, during the three years they had been in office, had reduced the expenditure by a Million and a Half of Dol lars, and the hon. gentleman has referred to the Public Accounts, alleging that they sustain that statement. I have referred to the Public Accounts also, but they do not support the statement of the Prime Minister; on the contrary, the Public Accounts show that the expenditure has increased year by year since his accession to office. The expenditure of 1876 was larger than that of 1875.* In referring to the public expenditure the Premier ought to have been accu rate. Such mis-statements as I am calling attention to led the people of the country to believe they were better off than they really are ; and that was not a worthy or proper thing for a Government to do. I hope the statement can be explained, for I can not doubt the errors were unintentional. In re ferring to the expenditure of previous years, especially of 1868, the Prime Minister should have remembered that Confederation was only in its infancy then, that the foundations of the Dominion had to be laid, and a large ab normal expenditure incurred. The Intercolonial Railway had to be under- taken and large amounts to be expended in the various Provinces. All this was * The estimates for 1878 are larger than those for 1877. I can discover no facts in the past or present to support the statement of the Prime Minister. I ''a. Sir "If "Oi "de "ol: "St << PUBLIC EXPENDITURE. 21) "^ perfectly indispensable. If the statement of the Prime Minister meant any- thing at all, he meant it to be understood that the burdens of the people had been reduced by his Government, in the three years they had been in office, by the sum of a Million and a Half of Dollars ; and yet this is not possible, for the estimates for next year are larger even than those for last year. It would not be worthy of the Prime Minister to say that he only meant that the expenditure from revenue upon the construction of certain public works was diminishing. Notwithstanding any reduction that might be made in ex- penditure upon Public Works from revenue, the interest upon the increasing expenditure from capital would still maintain the expenditure of the country, out of income, at its former or at a higher point. It would not be fair to the country to represent a mere transfer from one account to another as a real diminution of the burdens of the people, and unless the statement of the Prime Minister Vi.eant that there had been a positive diminution, it was misleading — not intentionally so, I feel sure, but necessarily misleading. So soon as the construction of certain buildings was finished, as a matter of course, the expenditure on tl.em would stop, and un- less other buildings or works, to be paid for out of revenue, were com- menced, the expenditure under that head must decrease ; but it does not follow that an absolute reduction of the public expenditure would be the result. There might be a reduction under one head and an increase under another, a mere transfer from one column to another ; and I fear that that is the case at present. The Government has been engaged in the construction of public works, all very desirable of their kind, but in course of time they become finished, and unless the Government enter upon similar expenditures elsewhere, the outlay under that head must decrease ; but they are going on with a very large expenditure from capital, and the interest upon that is chargedto the Consolidated Revenue Fund; therefore, the gross expenditure of the country from income does not decrease, and I am afraid will in- crease very rapidly. The Prime Minister should remember that the Railway now building between the head of Lake Superior and the Red River would cost not less than Twenty Millions of Dollars ; the interest on that would be One Million a year in round figures, to say nothing of a heavy loss from working the railway. It has been asserted very confidently by the present Government that they were committed by their predecessors to the large expenditure from revenue which is being carried on increasingly, and therefore that it is not within their control. I believe the contrary is susceptible of proof, and I will endeavor to throw some light on that subject. To do this I must take a retrospect of the financial affairs of the Dominion since 1870. It will be attended with some pleasure to review the prosperity the country enjoyed from 1870 to 1874, even if by contrast it make the present glbom seem darker than it otherwise would appear. I will first refer to the Budget speech of Sir Francis Hincks, delivered on the 7th April, 1870. Sir Francis said : " I believe the 'Country is in a state of prosperity, perfectly able to meet " aJ its obligations, and there is no cause of complaint of excessive taxation." Sir Francis then proceeded to speak of the debt, per head, of the population : " I find, sir, if we take Great Britain, that the debt of that country is about " One Hundred and Thirty^five Dollars per head of the population. The " debt of the United States is about Sixty Dollars per head. I may here " observe that although the ratio of debt is lower in the case of the United " States than that of Great Britain, it would be unfair to estimate the burdens " of the people according to the same ratio, for it is perfectly well known that *' the debt of England carries a very small rate of interest, while the debt of 33 >ls. ,in- •rs. ho he en ic. \^ )g Df S- e so I'l'III.K KXI'KNDITl UK " the United St;Uc> (arrics a larj^c rate. Now, sir, while llie delil of those •' countries is what I have stated, the deht of Canada is al)out Twenty-two '* Dollars and iMt'ty (!euts per head of the population. 'I'hen, again, taxation " in (ireat Mritain is at the rate of Ten Dollars per head, and in the United '* States Nine Dollars and Twenty-five Cents, while in (!anadait is only about " 'i'hree Dollars and l-'ifty Cents. I do not think, hearing these figures in " mind, that we need bt: afraid of any slight increase of taxation which it ma\ " be necessary to impose uijon the people, that there shall not be the least " cause to apprehend deficits in the future.' Sir I'rancis proceeded to say the surplus on the transactions of the year endin,: June 30th. iSyo, would be about One Million Dollars ; yet, not- withstanding the sound state in which the finances of the country then were. Sir I'rancis considered it prudent to increase the tariff five per c ent. on the duty of fifteen per ( ent. I will next refer to the Budget speech of Sir Krancis Hincks in 187 t. In that year the finances of the country were in an exceed- ingly satisfactory condition. Sir l*"rancis had estimated the surplus at One Million Eight Hundred and Ninety-two 'i'housand Dollars : it actually amounted to Three Millions Seven Hundred and Twelve 'i'housand four Hundred and Seventy-nine J)ollars, for the financial year ending June 30th.. 1871. I will also read the o])inion of Sir Alexander (lalt, — who was then not a supporter of the Administration, and who, while he made the following remarks, attacked several points of the l""inance Minister's policy :-*' With a " redundant revenue, and abundant means, and low taxation, nothing but " ordinary prudence and economy were necessary to insure the future pro- " gress of the country." On the same occasion Mr. Carlwright jjointed out that people when in easy ciicumstances were very apt to make engagements which they would not other wise make, and maintained there was great danger in such a course, and said ; " A very considerable portion of our future surplus would be taken up for " interest on the cost of the Intercolonial Railway, which he thought would " probably cost much more than was estimated. For all these reasons he " considered it a fit and ])roper time to warn the (Government and the coun- " try of the possible results of the course they were now pursuing.'" As early as 1S71 the present Finance Minister foresaw the difficulties which; have since overtaken us. He was among the first to predict the crisis, and he called atteniion to It every succeeding session until he became Finance Minister himself, when he seemed to regard but lightly the danger he had warned his predecessors against. Such was the state of the revenue that year (187 1 ) that Sir Francis modified the tariff by taking off the five jjev cent, imposed the previous session ; and, although he did not wish it and it was not a part of his policy, the duties upon ,agricultural products and coal were also taken off At that time there was nothing said about the equili briuni between revenue and exi)enditure, the revenue greatly exceeding the expenditure. I now come to Sir Francis Hincks' Budget s[)eechof 187 j. Notwithstand- ing the repeal of the duties imposed in 1870, involving a loss to the revenue of Eight Hundred Thousand Dollars, there was a surplus of Three Million .Seven Hundred and Twelve Thousand Four Hundred and Seventy-nine Dollars for the year ending the 30th June, 1871. F'or the year ending 30th June, 1872, the surplus was estimated at Three Million One Hundred and Fifteen Thousand Four Hundred and Sixty-five Dollars ; the actual surplus, was Three Million One Hundred and Twenty-five Thousand Three Hundred and Forty-five Dollars. Sir Francis Hincks estimated the surplus for the year ending 30th June. 1873, at One Million Dollars ; the actual surplus was-. ITHl.IC KXPEXDITURE. 31 expenses connected with the Union, and increased salaries estimated by Mr. Carlwright the country an additional One Million Six Hundred and Thirty-eight Thousand ICight Hundred and Twenty-two Dollars. Those were unquestionably years of plenty; and it was at that time, and under the circumstances I describe, that the late Govern- ment recommended the construction of certain public works, such as piers, harbours, light-houses, marine-hospitals, custom-houses, post-offices, &c., to be paid for out of the surplus revenue. It will be admitted that the state of the revenue in those years was such as to justify this expenditure. I now come to the Budget speech of Mr. Tilley, which contained a very interesting resume of the financial history of the Dominion. The duties on tea and coffee had been repealed in 1872, and the loss to the revenue from that source was One Million Two Hundred Thousand Dollars. Notwithstanding that, the surplus for the year ending the 30th June, 1873, was One Million Six Hundred and Thirty-eight Thousand Eight Hundred and Twenty-two Dollars. There was no additional taxation proposed that year. During the session of 1873 there were enactments passed which increased the expendi- ture of the country very considerably, and which it \rould not be fair to lay at the door of the present Ciovernment. These were increased subsidies to the Provinces resulting from the readjustment ot the Provincial debts ; admission of Prince Edward Island to the to the Civil servants. The'se, altogether, as in his Budget speech of 1874, imjiosed on burden of One MiUion Five Hundred Thousand Dollars. Mr. Tilley's estimates for that year, as introduced, amounted tQ Twenty Millions Nine Hundred and Forty-one Thousand One Hundred and Eighty-three Dollars. Then the legislation to which I have just referred was passed, and the expenditure for the year, under Acts of Parliament and by supplementary estimates, was authorized to be increased (according to Mr. Tilley) by the sum of One Million Five Hundred and Forty-two Thousand Dollars, making the total estimates for that year Twenty-two Millions Four Hundred and Eighty-three Thousand One Hundred and Eighty-three Dollars. The Senate will thus see that the Government of that day provided for the additional expenditure ordered by Parliament in the session of 1873. Mr. Tilley evidently supposed he was making ample provision for all the requirements of the year ending 30th June, 1874, including the increased statutory expenditure passed in the session of 1873. The late Government went out of office on the 7th November, and Mr. Tilley was succeeded by the present Finailce Minister. Mr. Cartwright, in his Budget speech of 1874, took a very gloomy view of the affairs and prospects of the country, and his speech was replete with words of warning; but instead of decreasing the expenditure, as would have been reason- able and prudent, he increased it very largely. That was the first error, and a very grievous error it was, on the part of the Administration. They saw the impending crisis — it was then to some extent upon us — but they went on in- creasing the expenditure very largely. The Finance Minister had been warning the country ; he had put up storm signals in all directions for his predecessors ; but, notwithstanding all, he did not act upon the opinions he professed, and did not take the precautions which a prudent Minister should have adopted under the circumstances. The statutory increases were referred to by Mr. Tilley ; and honourable gentlemen will also observe that Mr. Tilley and Mr. Cartwright, the Finance Ministers of the late and present Administrations, agreed substantially as to the amount of the statutory inc/ease of expenditure in the session of 1873. This is very important. Mr. Tilley is reported to have said that, " notwithstanding the additional " charges imposed upon the revenue of the present year (1873), the surplus S3 >rs, ,111- H-s. !l,c en c. e of s- IC o It t > 31' PlfHLIC KXPENDITURK. ** would reach Seven Hundred Thousand Dollars. The surplus next year he " estimated at Nine Hundred and Thirteen Thousand Dollars ; but the " supplementary estiinates and propositions before the House would require " One Million Five Hundred and Forty-two Thousanil Dollars, which would " leave a deficiency of about Six Hundred and Twenty-eight Thousand " Dollars. But owing to the surplus in the present year no deficiency would " arise." That was the state in which Mr. Tilley left the finances of the country. The revenue balanced the expenditure, and he indicated clearly that there would be no deficit. lUit the moment the new (Government came into office they appear to have largely in( leased the expenditure. In the following y(;ar Mr. Cartwright included Two Millions Four Hundred Thousand 'I'wo Hundred and Kighty-six Dollars in the schedule "A" of his Supply Bill. That might be called the Supplementary Sujiply Bill. Whoever was in the habit of looking at Supply Bills would i)e aware thnt they consisted of two schedules -" .\" and ** B." the former ( unsistin;; of item.s for the current financial year which had not been voted in the preceding session. A schedule "A" was found in every Supply Bill, but there was no schedule '' A." to compare in amount with that of i(S74, Mr. Cartwright's first Supply Bill. In 1873 schc 1 'A" was Seven Hundred and Ninety- two Thousand Eight Hundred . Sixty-four Dollars, but in 1874 it was Two Millions Four Hundred I'housand Two Hundred and F/ighty-six Dollars. Hon. Mr. Scott— To make up Mr. Tilley's deficiency. Hon. Mr. Macpherson — Mr. Tilley left no deficiency. Of this Two Mil- lions Four Hundred Thousand Two Hundred and Eighty-six Dolla/s the sum of Four Hundred and Twenty-hve Thousand Dollai's was on < npital account, so that the items in schedule "A" charged against the revenue, amounted in round numbers to Two Millions. The Government desiring, apparently, and not unnaturally, to proceed with extensive works chargeable to income, wanted additional revenue and a largar surplus. To obtain these the Minis- ter of Finance increased the tariff from fifteen per cent, to seventeen and a half per cent., and in other respects made additions to taxation, which he estimated would add Three Milliors of Dollars to the revenue. He may have been sanguine enough to hope that his additions would yield even a largel" sum, probably Four Millions of Dollars; at all events he counted upon an increased revenue of Three Millions of Dollars, and upon that basis the Govern- ment appear to have pitched their scale of public expenditure. Hon. gentlemen know how disappointing the result has been. The ne\\ ia\es. instead of coming up to the estimate of Three Millions, yielded only One Million Seven Hundred Thousand Dollars, not enough to meet the expenditure. It was then that the difficulties of the country began. It was then thr.t the deficit commenced, which at the end of the last financial year — 30th o^ June last — amounted to Two Million Dollars, and is still increasing. The Minister of Finance, in his Budget Speech of 1S74. laid the responsi- bility of the expenditure upon his predecessors, but I do not think the facts warranted his doing so. The expenditure from revenue imder the control of an Administration pledged to retrenchment and economy, as the new Govern- ment was, and supported by an enormous majorit}. should have been retrenched. Some of the works might have been stopped, the e?cpenditure upon others reduced, and a deficit avoided. But the Minister of Finance and the Prime Minister thought it best to proceed with the worics in progress and also with new works, and so increase the expenditure as to produce the diffi- culties that now press upon the country. While doing this they endeavored to fasten the responsibility of their policy upon their predecessors. The present - ' I'UHl.K KXI'KMHIUUK. sa Cff)vcrnmcnt woiiKI havf been ul a grciil iossif tlicy h;ul not IkkI prucUi c»<>r>. Everythin}^ done wliiili sliould not have hctii tloiu', and cvorytliing left un- done which should have been done, thev rhar^'td against th(jse predec essi»rs. When I hear the utterances of Iionorahle gentlt-nien opposite, and read the speeches delivered in another place. I ofleii wonder what would have been the result if those gentlemen had not had prt.-dei esjjors in (-nice, or if the) had been in office when Confederation was undertaken. But 1 med not speculate on the subject. Cup.k'deration. in that case, would never have been carried out. Mr. Cartwright's estiniale (jf the revenue for 1874 was 'Twenty five Millions; it yielded only 'I'-venl) four Millions .Six Hundred and Korty-eight Thousand .Seven Hiuid.-i dand Fifteen iJollars, leaving a deficiency as compared vvith lhee^tinlate the first since Confederation of Three Hundred and Fifty one Thousand Dollars. Now,\\hatthe Tinance Minis- ter should have done — because he could not plead ignorance of the state of the country — was to diminish the expenditure. The expenditure upon a great many works could have been stopped. and the expenditure ujjon others diminished; and above all, new works >hould not have been < (jmmenced. I propose to show that a great many new and costly woiks were undertaken bj the present Administration which were not thought of by their predecessors in iSy,^. Hut before doing so, 1 will ([uote from Sir John Rose's Budget S])eech in 1869. to show what had been done by the late Administration when they were thre.it ened with a tlei'icit. Sir John Rose sai:I : — " When the (iovernment found the revenue was falling short, that "it did not come up to anticipation, that the re eipts of one month " after another were below those of the corresponding month of the previous " year, they certainly felt that a very serious and (hfficiut task might be entailed " upon them; for 1 believe, if there is any sentiment stronger than another in " the minds of the people in this country, as represented not only by support " ers of the Ciovernmcnt, but by honourable gentlemen on that side, it is that "■ we shall not permit any deficits to arise, but if the ordinary revenue falls short " of the expenditure, we must manfully look the diffi<:ulty in the face, and be " prepared, by e.Kceptional taxation, if need be, to supplement the deficiency. " We cannot but feel it to be one of our first duties so to equalize the rcvcniu " and expenditure that our credit abroad shall not be injured by its being supposed '"'■ that we ai e willing to allow deficiencies to arise, without being ready to im- " pose upon ourselves a sufficient burden to meet them. ^i ^ * '\-\^^^. " present Government would, however, be very recreant to its duty, if, strong " in the majority in this House, and strong, I believe, in the confidence which " the country reposes in us, we should permit it to go abroad that we would " allow a deficit to arise in any year, without being pre|)ared for that year to " submit to the House such further measures of taxation, exceptional and " special, if need be, as would enable us to supply the void. I make these " remarks in order to show the House what were the considerations which " necessarily forced themselves on the attention of the Government, and the " conclusion to which they were driven, that any real deficiency must be sup- " plemented by fresh sources of revenue. They believed, indeed, that, no " matter who occupied the position, any body of men enjoying the confidence " of the people of this country would be [prepared to propose such measures. *' in the belief that they would be sustained by the House and the country. " But, while entertaining these view.s, the Government of course felt it their " duty to exhaust every means by which a deficiency could be avoided. The\ " saw month by month that the revenue was falling short, that there had been " excessive importations in previous years, and that these were being followed " by a corresponding contraction; and they felt it to be their duty, from the 34 PrP,LT( • EXIM'LNDITrRK. " outset, at all events to try whether by practising the most rigid economy it " was not possible to avoid the threatened deficit. The House will remember " the votes which were placed at the disposal of the Government last year; ** and the results which are to be found in the statement I have just placed in " the hands of honorable members will show, I think, that wherever it was " possible to practise economy, wherever it was possible, without undue " damage to the public interest, to forego the performance of a service for " which provision had been made in the votes for the year, the Government " have endeavoured to do it. We contracted no new obligations — we entered " upon no new works — we did exactly as any individual would do who saw '•' that his income was falling short — we took stock, and determined that while " the public service should be efficiently performed, we ttwuhi not incur any " new obligations ivith respect to public works which might he very much needed " and very desirable, but rvhich, at all events, it was not for the interest of the " country to undertake at a moment ivhen the actual revenue would not enable us " to provide for them. It will be found by reference to that statement that in " every one of the items which were voted to us last year there is a saving in " the actual expenditure, as compared with the estimate — except only in the " interest on the public debt, which is augmented by reason of our having " borrowed half of the Intercolonial loan. On every one of the other items of " expenditure there is a saving on the charges of management of the public " debt — premium and discount, civil government, administration of justice, *' police, penitentiaries, legislation, marine hospital and mariners' fund, militia " and enrolled force, arts, agriculture and statistics, public works, ocean and " river steam service, light-houses and coast service. So, too, with the item of *' fisheries, miscellaneous, collection of revenue, etc.; and the result is, that by " the exercise of economy — by forbearing to undertake new works, by cutting " down expenditure wherever we could cut it down — we show a balance in " favour of the year's operations of Two Hundred and Seventy Four Thousand, " and Thirty-one Dollars. (Hear, hear, and cheers.) Now, Sir, I wish to state that *' in arriving at this result, while exaggerating nothing, we have concealed " nothing. There has been no manipulation of accounts, no postponement of " payments." Sir John Rose saw the danger, and exercised the influence which a gentle- man charged with the fi'iances and credit of the country should possess with his colleagues, and the result was, instead of a deficit, a surplus. The course pursued by the present Finance Minister seems to have been the very oppo site. It was surprising that a gentleman with so much force of character as the present Finance Minister should have failed to impress on his col- leagues his views aud opinions^ of the depression impending when they succeeded to oflRoe. I can only account for it by supposing that the Fi- nance Minister took a more sanguine view of the revenue, after he had increased the taxation, than was justified by the result. No doubt he !.dd a great deal to contend with. His colleagues desired to have handsome amounts placed at the disposal of their departments for expenditure. The Finance Minister had remarked irv his Budget speech of 1874-— " I am aware that some of my honourable friend3 Lhink this enormous out- '' lay need not be gone on with; but I desire to say that these public works " that are in process of construction must be completed in a short time. 1 " see no purpose to be served by 'cooking' our estimates and apparently re- * ducing the amount chargeable this year in order that it may be swollen the " next. My honourable friend (the Minister of Public Works) has preferred " — and I think he was perfectly right in so doing — to bring down those esti " mates, to show the obligation placed on him by the action of the late rUBLIl' EXI'EXDITLJIE. 35 I " Government. * * * i must again repeat that it would be in the last " degree unjust to my hon. friend the Minister of Public Works to hold him " responsible for this state of things, or to ask him to stop woi- s already com- " menced, and to put a reduced sum in the estimates ; but \7hen the works " now engaged in are completed, which I expect will be the case in eighteen *' months, a considerable saving will be effected in the annual expenditure, " though for this a considerable period of time is necessarily required. " Could there be anything more unbusiness-like or absurd? Suppose a private individual entered upon some improvement of his property, under the impression that his income would enable him to complete it, but in a short time he found that his income was falling off, would he be wise to incur a debt to carry out his plans? Could anything be more imprudent? What is the use of a change of Government unless there can be a change of policy, unless to retrench and economise when necessary ? Engagements had been entered into by the late Government of a nature which could be suspended at any moment, yet they were proceeded with by the present (iovernment recklessly, without any regard to the fact that the revenue upon which their execution depended was faUing short month by month. Mr. Cartwright found the taxation which he had im- posed yielded only One Million Seven Hundred Thousand Dollarsinsteadofthe Three Millions which he had anticipated; but instead of decreasing expenditure he increased it, throwing all the responsibility on the shoulders of the late Ad- ministration. The present Government seems to be perfectly helpless. The only reform, or rather financial change, which they gave to the country was to increase taxation and to change surpluses into deficits. From Confederation to the time of the change of Government in 1873, t^he amount of Eleven Millions One Hundred and Sixty Thousand Eight Hundred and Forty-four Dollars was expended out of surplus revenue in the construction of public works chargeable to capital. An Administration with such a flowing revenue was surely justified in undertaking public works and paying for them out of the revenue ; but when the present Finance Minister anticipated a de- ficit, and stated so in his Budget speech, there was no excuse for continuing to expend money as lavishly as in the years of plenty. The Government has placed this country in an unfortunate position by the course it has pursued. There is a large deficit, and we are now paying the interest of our debt with borrowed money. A more unsound and perilous condition for any coun- try to be placed in it is impossible to conceive. The taxation of the country has been seriously increased, yet the expenditure has been increased in a still greater ratio. In the Budget speech of 1876, Mr. Cartwright was still hoptful, as he had been from his accession to office — but less sanguine, on the v*hoie; the hues are not exactly roseate, but they are still hopeful. Mr. Cartwright began then to excuse the present Govenuuent for not having retrenched, as they were pledged to do. He had to acknowledge the existence of a large deficit, but still blamed the late Government. In his Budget speech the Finance Minister estimated the revenue for the current year (1877) at Twenty-three Millions Two Hundred and Fifty Thousand Dollars, and the expenditure at something less. It is usual, as the House is aware, for the Finance Minister, in his Budget speech, to revise the estimates of the preceding session, but Mr. Cartwright omitted to do this in his speech of February, 1877, though between seven and eight months of the current fiscal year had then elapsed. Parliament was, therefore, left in ignorance of his revised estimate of the revenue and expenditure, of whether in his opinion there was to be a deficit or a surplus at the end of the current financial year. The want of the official revised statement is a serious want, and, in fact, it is impossible to complete comparisons without it. I have obtained statements of the revenue p to the Toth of February, for the years 1876 and 1877. The revenue up to 36 IMRLIC KXI'KNI)ITI;RE. the loth of February, 1876, was 'I'welve Millions, Eight Hundred and Twenty Thousand, Eight Hundred and Seventy-five Hollars, and for the same period of the current year it was only Twelve Millions, Four Hundred and Nineiy- four Thousand, Two Hundred and Seventy-nine Dollars, showing a falling off, as compared with the preceding year, of Three Hundred and Twenty-six Thousand Five Hundred and Ninety-six Dollars. Mr. Cartwright had esti- mated the revenue from customs for the current year at Thirteen Millions Five Hundred Thousand Dollars; up to the loth of February it had only reached Seven Millions and Eighty-two Thousand Two Hundred and Tvventy-seven Dollars, which was at a rate of about J'Llevcn Millions, l''ive Hundred Thou- sand Dollars for the year, instead of Thirteen Millions Five Hundred Thou- sand Dollars, It is quite true diat tlu,- s])ring importations are coming in, and the duties upon them will increase the average revenue for the remaining months of the financial year verv consideraljly. but whether they will in- crease it sufficiently to bring it up to Mr. Cartwright's estimate is very doubtful. Notwithstanding all that has been ^.lid about retrenchment and economy, the estimates for tnc ensuing year show an increase over those of the current year. The estimates for the current year -and that was without supplementary elements — amounted to Twenty-three Millions Thirty-one Thousand Six Hundred and Ninety-nine Dollars; for next year they amount to 'Iwenty-three Millions One Hundred and Sixty-seven Thousand, Six Hundred and Eighty-six 1 >ollars — not a large increase, but they are ex- clusive of supplementary estimates also, which have yet to be brought down, and which 1 feur will be very considerable. It is, therefore, probable that we shall have to face a deficit for the ensuing year as well as for the current year. 1 will now turn to another branch of the subject, and show the extent and manner in which the ^:ontrollable expenditure has been increased since 1873. I would not have gone into this again this session if it had not l)een for the way in whi<;h the Government and its friends treat-e4 the subject when 1 brought it before the Senate early in-vkc-scssioh : — The hon. Senator opposite (A^r MacMaster) then said " he thought the "course foUov/ed by tiie' hon. gentleman from Joronto (Mr. Macpherson) was " unusual and unfair; that he had taken many members by surprise; and they " could have met several points su^ ■.essfuUy had proper time been given them " to prepare for the debate. The comparison instituted between 1873, '^^^ " 1875, '^"d 1876, was entirely unfairand unreasonable. In the first place the " late (rovernment went out of oflice in November, 1873, and their successors " were acting upon their estimates. He did not want it to be understood he " was either defending or finding fault with any Government;, but he liked to see " what was lair. * * With regard to the increased expenditure in the de- " partments, he knew that it was partly due to appointments made by the late " Govemment. He knew large establishments in which parties were appointed " who had nothing whatever to do. and if they had to work, were utterly " incompetent to do it. * * * * * With regard to the " matters alluded to, if time had been given to go into figures, and make fair " comparison, it would not appear so unfavourable to this Government, as the " honourable gentleman hid '^r,>!."lT^ t-o make the House believe. He con- " curred in the opinion that it \\as absomtely necessary, in the present state of " the country, for the (iovernment and everyone to be as econojnical as " possible, but it must be borne in mind the Dominion is pledged to build the " Pacific Railway.' Now, that was a very broad denial of my statement, and the honourable Senator should be in a position to-day to prove what he then said. There has been ample time since then to prepare a reply, if reply be possible. \ PUBLIC EXPENDITUKE. 37 The honourable Senator, having denied the correctness of my statement, should have taken the earliest opportunity to show wherein it was inaccurate ; because, if inaccurate, it should be corrected. It is not desirable that an error in so important a matter should go uncorrected. But my state- ment contained no error, and no attempt has been made to disprove it. I will show that the denial of its correctness by the honourable Senator was unsupported by facts. I will now submit a statement of the details of increases of expenditure charged to consolidated revenue fund and largely within the control of the Government of the day, for 1875 and 1876 over 1873, and of 1876 over 1875. In this comparative statement I exclude all items connected with the public debt — interest, management of the debt and sinking fund. I also exclude items that might not be considered fairly within the control of the Administra- tion, such as Militia ; and throughout these statements I will compare the last complete year of Sir John Macdonald's Administration, 1873, with Mr. Mackenzie's complete years of 1875 ^^^ 1876. The KOLLOWFNG STATEMENT SHOWS THE INCREASES IN ExeENmiURE CHARGED TO CONSOLIDATED REVENUE FUND FOR 1875 AND 1876 OVER 1873, AND FOR 1876 OVER 1875, UNDER THE FOLLOWING HEADS, BEING ItEMS WHICH ARE LARGELY WITHIN THE CONTROL OF THE Government. (Public Debt charges not included) Departments. "Ciivii Government " Administration of Justice Police and Penitentiaries Legislation Geological Survey Arts, Agriculture, etc Immigration and Quarantine Marine Hospitals Pensions and Superannuations Ocean and River Steam Service Fisheries and Light-houses Inspection Insurance Go's, etc Subsidies to Provinces Public Works Miscellaneous Indian Grants and Manitoba Surveys. Mounted Police (established 1874). . Boundary Surveys (begun 1874). ... Customs and Excise Weights and Measures Public Works, Including Railways ... Post Office Minor Revenues 'increase .j,?^ j-ove'r 1873. $148,391 98,439 71,682 29,199 15,402 10,871 38,72*' 9,881 829,362 159,462 18,229 i3i'5i3 333,583 121,741 142,457 69,969 633,388 452,995 'hieTease 1870! over 1875. I Increase 1876 over 1873. $ 46,686 54,957 3,226 47,416 83,075 1,950 70,874 93,057 97,191 8,914 191,866 91,537 108,639 35,935 12,364 57,441 29,816 101,966 3»"i $ 91,121 145,025 4,968 12,743 .^2,425 9,488 98,477 12,821 109,598 90,339 75,778 8,032 768,956 351,328 iog,866 212,549 369,518 134,105 199,898 99,785 548,312 554,961 ^,778 Increase of 1875 over 1873 $2,960,336 Increase of 1876 over 1875 717,062 Increase of 1876 over 1873 3,677,398 38 PUBLIC EXPENDITURE. This statement shows that the expenditure of 1876 exceeded that of 1873 by the large sum of $3,677,398; that the expenditure of 1875 exceeded that of 1873 by the sum of $2,960,336, while that of 1876 exceeded that of 1875 by the sum of $717,062. These net increases are enormous — I say net increases, because all the decreases have been deducted. But I am not going to hold the Government responsible for the full amount of the increase of 1876 over 1873 — $3,677,398 — for, as I have already shown, statutory in- creases of expenditure were made in 1873, and provided for by Mr. Tilley. Mr. Cnrtwright stated this amount to be about $1,500,000. The increases fairly chargeable against the present Government are as follows : — I ii Net increase of annual expenditureCiargely within the control of the Administration) in 1876 over 1873 $3,677,398 Less expenditure authorized by statute in session of 1873, vi/: Increased subsidies to Provinces; increased allow- ance to the Civil Service ; item on account of expense connected with the admission of Prince [ $1,500,000 Edward Island into the Confederation ($100,- 000), and other statutory increases : stated by the present Minister of Finance, in his budget speech of 1874, at about $1,500,000 I will allow for unforeseen increases from 1873 to 1876, inclusive, say 377,398 1,877,398 Making the increased expenditure upon items largely within the control of the present Administration, in 1876 over 1873 1,800,000' This sum capitalized at 5 per cent, would give Thirty- six Millions of Dollars. i< Increase in 1876 over 1875 717,062 This sum capitalized at 5 per cent, would give Four- teen Millions, Three Hundred and Forty-one Thousand, Two Hun'fired and Forty Dollars.* I am particular in emphasizing the' increase of 1876 over 1875, because there can be no question as to which Government is responsible for it. The present Government have a much larger responsibility than they wish to admit for the increased expenditure of the financial year ending 30th June, 1874. I will now call attention to the expenditure on public works in each Province in the same years : — * Thus tlie increase by the present Administration in the controllable expenditure between 1876 and 1873 (One Million Eight Hundred Thousand Dollars) is equal to interest at 5 per cent, on Thirty-six Million Dollars; and the annual burden on the people would be no greater, if instead of increasing the expenditure unnecessarily the Government had bor- njwed Thirty-six Millions of Dollars. Now, a small portion of this sum, if it had been borrowed and judiciously expended, would have done much to promote the prosperity of the country. The very mcrease of the controllable expenditure of 1876 over 1875 — ^even Hundred and Seventeen Thousand and Sixty-two Dollars— is the interest at 5 per cent, on Fourteen Millions, Three Hundred and Forty-one Thousand. Two Hundred and Forty Dollars. PUBLIC EXPENDITURE. 39 * \ i U) Public^ Works charged to Consolidated Revenuk Tund, showing THE Expenditure in each Province. Works. ONTARIO. Custom Houses, Post Offices, etc Marine Hospitals, Quarantine and Im- migration Stations Penitentiaries, Barracks, etc. ... , Harbours and Piers Total Ontario QUEBEC. Custom Houses, Post Offices . Marine Hospitals Penitentiaries, Barracks, etc . Harbours and Piers 2,000 58,962 262,413 $315,032 , $415,878 $582,976 Total Quebec . NEW BRUNSWrCK. Custom Houses Marine Hospitals Penitentiaries Harbours and Piers Total New Brunswick $162,975 11,083 9,684 $146,439 16,767 10.753 $146,626 12,695 15.359 28,373 $183,742 $173,959 $203,053 $28,392 3>674 28,000 $83,1.05 1,640 56,376 $ 29,324 10,860 92,609 NOVA SCOTIA. Custom Houses, etc. Marine Hospitals. . . , Penitentiaries Harbours and Piers . $60,066 $141,121 ! $132,793 $11,429 100,246 $ 3.330 7,178 123,497 $ 14,086 8,200 i 11,000 ; 145.965 Total Nova Scotia 1 $11 1,675 BRITISH COLUMBIA. Custom Houses . . Marine Hospitals Penitentiaries . . . . Total British Columbia. MANITOBA. Custom House, Post Office , Immigrant Shed Penitentiary, Barracks, etc. Total Manitoba. 6,614 $6,614 $ 109 6,742 $6,851 $134,005 I $179,251 $ 22,347 2,978 1,571 78,114 $26,896 $78,114 $27.5^3 ! $ 40,092 65,072 ; 102,563 $92,575 ' $142,655, 40 PUBLIC EXPENDITURE. Ij.^ Public Works charged to Consolidated Revenue Fund, showing the Expenditure in each Province. — (Continued.) Works. ^'^n- '875- PRINCE EDWARD ISLAND. Harbours and Piers Public Buildings r.ENERAI. ITEMS. Public Buildings, general account Canals, including surveys and inspection Improvements of rivers Dredging and Dredge Vessels Telegraphs Lighthouse Repairs Slides and Booms Roads and Bridges Red River Route Arbitration and Awards . . Rents, Repairs, and Furniture Ottawa Buildings Sundries Total expenditure on Public Works paid out of Consolidated Fund in 1873 Total expenditure on Public Works paid out of Consolidated Fund in 1875. Total expenditure on Public Works paid out of Consolidated Fund in 1876 $i43»oi5 18,140 79,426 9,044 I '5,718 ,7.621 39,8oS 195.492 $5,829 $ i4»773 25,006 62,737 195,782 20,986 4,000 176,659 5»258 u;^324 58,000 15.287 $1,597,613 $1,757,075 1876. $25,061 3.574 44,343 40,255 123,100 4,000 25,428 88,298 11,680 169,127 63t5oo 31.733 $1,948,941 The following table gives the Expenditure on Piers, Harbours and Breakwaters, for the same years. PIERS AND HARBOURS. Ontario Quebec New Brunswick Nova Scotia Prince Edwarji Island. $ 209,887 9,684 28,000 100,246 $ 208,486 10,753 56,376 123,497 1876. Increase 1876 over 1875- 399,112 $ 262,413 I 28,373 ! 92,609 I 145.965 I 25,061 i $ 53.927 17,620 36,233 22,468 Increase 1876 over 1873. $ 52,526 18,689 64,601; 45.7^9 554.421 Totals I 347,817 Increased Expenditure on Piers, Harbours and Break- waters in 1876 over 1875 $130,248 Increase in Expenditure on Piers, Harbours and Break- I waters in 1876 over 1878 (excluding P. E. Island) $181,543 ^ PUBLIC EXPENDITURE. 41 HE This is not the only expenditure under this head, and I am of opinion many works of the kind have been proceeded with for party rather than pubHc considerations. There are three harbours on Lake Huron very near each other — Goderich, Bayfield, and Chantry Island — on which there has been very large expenditure. On Goderich harbour, in 1876, the enormous sum of One Hundred and Twenty-seven Thousand Dollars was expended, and I am told, very unfortunately expended. Hon. Mr. Scott said the contract was given out by the late Administration. Hon. Mr. Macpherson — I do not care what Administration gave it out, the work was under the supervision of the present Government. Hon. Mr. Campbell — The contractor's name is McEwen, and he is a friend of the present Administration. Hon. Mr. Macpherson — In addition to Goderich, Forty-one Thousand Six Hundred and Twenty-four Dollars was expended last year on Chantry Island, and Eighteen Thousand Nine Hundred and Thirty-eight Dollars on Bayfield, which is only distant about twelve miles from Goderich. Hon. Mr. Scott said Chantry Island as well as Goderich Harbour improve- ments had been commenced by the late Administration. The contracts were given out the last year they were in office, and the work had been going on ever since. Hon. Mr. Macpherson — It is the expenditure I complain of; and the amount of new expenditures upon works of this class, commenced under the auspices ot the present Government, will be seen by the following Statement of Expenditure charged to Consolidated Revenue Fund IN 1875 AND 1876, for works NOT COMMENCED IN 1874, VIZ : — ON Piers, Harbours, River Works, Custom Houses, Penitentiaries, Marine Hospitals, &c. : — Works. 1875- kl :s. it \z Owen Sound 1$ 3,740 Bayfield 1.9^7 Port Stanley 31 Port Hope 6,945 Toronto ^ ijOig Point dii Chene 7>35 1 Shippegan 16 Tignish 2,010 Souris 5,829 Port Albert 6,000 Shannonville 2,992 Kingston 4,407 Picton 6,000 Coteau 1,603 Bathurst 3,876 Tynemouth 2,500 Tracadie 6,690 Port Medway 4,5^3 Sissiboo * 2,500 Plympton 1,200 Port Darlington Port Burwell Oshawa [876. $ 5.500 18,398 4,732 14,372 2,824 7,228 6,312 4,557 i 5»ooo . 3.422 i 5.000 Carried forward , 1^^ 71.139 77.345 4,2 PUBLIC EXPENDITURE. 7 Works. Brought forward Bagotville Malbie Eboulements, extension of breakwatef . . . . Riviere Blanche Baie des Chaleurs Campobello Jordan Bay Trout Cove Margaree Harbourville ■ Broad Cove Margaretville Oyster Pond Michaud and Mark Points Cranberry Head Church Point SauHerville New London Coville Bay St. John, N.B., Custom House Montreal Montreal Examining Warehouse Chatham and Newcastle Custom House. . . London Post Office Lifting barge, for removing chains, &c . . . . Work Napanee River Work Detroit River Increase of General Work on River Im provements over 1874 Toronto Immigration Station Quebec Marhie Hospital Yarmouth " Sydney " St. Catharines " Levis " Souris " Quebec Observatory Military School, Kingston Fortificatipns, Kingston " Levis 1875. 1876. 7i»i39 5>io3 Penitentiary, Kingston " Maritime Provinces *' Manitoba " British Columbia . . St. Vincent de Paul Penitentiary . 3»2i7 3.426 203 1.393 3.500 25,000 40,811 475 6,008 6,180 157 1,798 77.345 2, 000 8,000 7.500 873 3,000 600 17.465 4,000 3.000 2,000 3,000 5,000 2,000 97 2,000 2,000 2,000 503 20,000 2,081 12,211 1,346 18,329 152 6,998 2,000 2,003 3.574 55.659 3.303 15.357' 3.213 21,860 60,597 78,114 4,076 Totals j $168,413 Add 1875 to 1876 ! Gross amount expended in 1875 and 1876, on works not commenced in 1874 . . .... $453,256 168,413 j!4 C. o Bi P( $621,669 7 PUBLIC EXPENDITURE. 48 4 There can be no question as to which Government is responsible for this expenditure. The present Government is wholly responsible for it, and it was incurred in disregard of their pledges to retrench. The following shows the Expenditure— CHARGED to Consolidated Revenue Fund — for Har- bours, Piers, Breakwaters, Canal Works, River Improvements, Slides and Booms, Bridges, Hospitals, Buildings, etc., in 1874, 1875, and 1876, WHICH WERE NOT COMMENCED IN 1 8 73 : — Works. Napanee Belleville Meaford Inverhuron Port Greville Breakwater Joggings Gaberous Bay Ports George and Williams , . Salmon River Chedabucto , Green Cove Pictou Island Digby Pier Big Pond, Cape Breton Morden Pier Wilson Beach Dipper Harbour. St. John, New Brunswick . . . . , Hillsboro Pier Tracadie , Big Tracadie , Port Albert Tynemouth , Port Stanley Collingwood Shannonville Picton Harbour Plympton Bathurst Sissiboo River Sackville Port Medway Souris, Prince Edward Island, Cobourg Saguenay Baie St. Paul Cow Bay Oven Sound Bayfield Port Hope 1874. $ 4,999 10,000 4,396 6,000 10,000 2,000 3,500 5,000 5,000 2,500 2,000 2,500 2,000 5,000 1, 000 10,000 3,500 1,500 6,000 28,932 203 6,000 122 10,000 Carried forward ! $133,152 1875- $. 5,000 6,690 '6,000 2,500 31 • 267 2,992 6,000 1,200 3,876 2,500 500 4,513 5,829 15,861 25,300 3.740 1,917 6,945 1876. $. 4,732 23,403 2,000 8,000 46,458 5,500 18,398 '14,372 $101,361 I $122,863 44 I'UHLIC EXPENDITUKK. Works. ■81 Brought forward Jordan Bay Shippegan Port Burwell Port Darlington Toronto Harbour , Oshawa Malbaie Pier Eboulements Extensions of Breakwater Riviere Blanche Point du Chene Campobello Baie des Ghaleurs Margaree Bagotville Harbourville Trout Cove Broad Cove Margaretville Oyster Pond Cranberry Head Michaud and Mark Points Church Point Tignish Saulierville ColviUe Bay New London Canal Basin, Ottawa* Lock, Culbute Rapids River St. John improvements River Detroit .' Richelieu River Fraser River Napanee River Bridge, Fort Garry. Bridge, Portage du Fort Fenclon River Gatineau River New<;astle Dist. Works Petewawa River Telegraph Cable, British Columbia. . . Hamilton Post Office Montreal Custom House Three Rivers St. John, New Brunswick Miscellaneous, Prince Edward Island. Military School, Kingston. Observatory, Quebec Carried forward 1874. 133,152 4,443 38,838 7,480 2,967 3,547 3,090 28,716 1,000 7,713 9,295 2,552 69,000 3ii»343 I87S. 101,361 5,103 16 1,019 7,354 2,010 200 21,119 5,739 9,044 3,426 3,217 1,798 1876. 122,863 17,465 6,312 3,422* 5,000 2,824 5,000 8,000 7,500 873 7,228 600 3,000 3,000 2,000 2,000 4,000 3,000 5,000 2,000 2,000 97 i.OOO 4,557 2,000 20,000 503 1,346 12,211 2,081 55,659 4 t c y f( ii tl 161,406 313,541 . PUBIJC EXPENDITUUK. 45 I 4 t NAMliS OF WORKS. Brought forward Marine Hospital, New Brunswick " Quebec . . ^ •* Yarmouth " Sydney " St. Catharines " Levis " Souris Toronto Immigration Station Penitentiary, British Columbia " Maritime Provinces " Manitoba " St. Vincent du Paul " Kingston Government House, Fort Garry Barracks, Battle River " FortPelly Fortifications, Kingston " Levis Total amount expended in 1874 upon works not commenced in 1873 $327,552 Total amount expended in 1875 upon works not commenced in 1873 $203,546 8,ooo 33.966 3.300 15.357 Total amount expended in 1876 upon works not commenced in 1873 $556,596 The present Government is of course alone responsible for the expendi- ture upon works commenced in 1875 and 1876, as well as for that upon s$>me of the worKs commenced in 1874. I now come to an important and interesting statement — " Pubhc Works, Charges on Revenue," being chiefly for maintenance of the works, for the same years, namely, canals and improvements of Rivers, Railways, etc. In the case of the canals I have separated the salaries of the staff from the charge for labor for maintaining the works. It will be seen that the increase of expenditure in this direction has been large, but I will not trespass upon the patience of the Senate by dwelling upon it. The statement is as follows : — 46 1'U1<1'><' KXPENDITURE. PUBl-lC WAYS, &c. : Works. Works, charges ON RV-VKNUE, ON Canals, Improvements of IN Rivers, Rail- Salaries ....' 52.035 -Welland Canal , 32,453 Lachine Canal , ,3,106 Beauharnois .1 I3.940 Cornwall ; 7,600 ■Williamsburg 310 Burlington Bay 12,810 Chambly . • • • • •, ....: 24,30° Ottawa and Ri^^eau . ,^^967 Carillon and GrenviUe •• ; 3 ,7 St Anne's Lock , 2,620 St. Our's Lock ' , 343 St reter's Canal / ,,657 Miscellaneoxis . . ■ -^ • • • • • • ; 14,654 Ottawa River Works .... ,(, 356 684 Saguenay Works.. Newcastle District Works. Sundries •••l7r;,-i^ Inspection of Canals piers bolow Quebec Agent and Contingencies B.C.... I ^ Totals . 33.340 4.490 4,025 2,302 2,185 ■ "18,871 161 257.U2 208,230 Recapitulation. Total Salaries Total Labour Railways and Telegraphs. Rivers, Railways, $2,139,573 ™ifs^^"rKe^vS:in.i87b &c., charges on Kevenu ^t $2,044,497 Civil Govermtient. n^ave j==ri'?s.f.3-K.---. ...'*" I'llll.rc KXfKNDITniK. 47 iJLlAILh OF EXI'ENIJIIL KL ON ACCOUNT OK CiVIL ( i<.>\ KkN .\thM , L-*'* ) s 2 >5 7» 61 42 36,403 1873- DHAKI VIKNTS. 5-442 1870, f^alarie.-. 112,005 10,971 ■20, 732 22,983 44,071 38,702 48,063 28,445 31,565 54. '99 4, '59 35.743 56,<)40 :j3 a •J $ l>,^22 4.554 4,996 5.971 7.650 6,138 3, 609 5-907 '4.39* 709 •7.234 11,320 92,400 35,t>55 32 2.789 31,820 '3.500 11,911 16,003 685,166 j 212,327 1670,142 , l7I,fK>2 Rkcapitulation. TlKMS. 'I'otal Salaries Total Contingencies . . . . Land Office, Manitoba, . Dominion Office, N. S . . Dominion Office, N.B. . Stationery and Sundries . Civil Service '87^ $ 559,392 176,709 3.973 3.269 4,693 2.838 i«7! 1876. $ 685,166 212,327 11,098 $ 070,142 171,602 l_ Total Expenditure on account of Civil Govern- ment in 1873 ! $ 750,874 Total Expenditure on account of Civil Govern- ment in 1875 47 627 . 2^1 $909,265 Total Expenditure on account of Civil Govern- ment in 1876 $841,995 I have also dissected the contingencies ; separating the charge for extra clerks from the other items. It has been stated very positively by the hon- ourable Senator from Toronto {Mr. Mc Master) that the public offices were filled by supernumeraries appointed by the late Government just before their D 48 PUBLIC EXPENDITUKE. ^ retirement from office ; and a similar statement was made by the honour- able r>enator from Hamilton (Mr. Hope), when the subject was before the House a few weeks ago. It has been made and constantly repeated by the f'fovernment and their supporters for years. The Prime Minister himself even has made the same statement, adding that many of the appointments made by the late Administration just before retiring from office had been cancelled by the new Government. If appointments had been improperly made I would not defend them. 1 presume no officials but those for whom there was work were retained by the new Government. No doubt em- ployment was found for them very soon ; but if it be true that many super- numeraries were appointed by the late Government, and remained unem- ployed, how is it that so many extra clerks were required in the departments? It is impossible to believe that, even extravagant as the present Government is, it would have employed extra clerks while supernumeraries remained idle about the departments. The following statement is a complete refuta- tion of this charge against the late Administration : — Departmental Contingencies at Ottawa, with Amount paid to extra Clerks, (which Items form part of total Contingencies.) Dli'.vroieni. 1873- .a 'u c w H-5 Secretary'.s Office Privy Ooiinci'i Justice Militia and Defence Secretary of State, includ- ing (2uecn's Printer in 187s Interior Receiver-Ueneral j Inland Revenue j Fi"ance j Treasury Board ' Customs ' Public Works j Post Office ' Agriculture j Marine and Fisheries . . . . Sundry Departments $ 8,140 S.033 9.470 5.764 9.394 3.072 3.224 9.451 9,226 313 26,811! 13.192 38,850 12,723 10,048 11,998 Departmental Totals 176,709 Contingencies of House of Commons ! 104,008 Total Departmental Con- tingencies at Ottawa, 73; 280,717 Total Departmental Con-, tingencies at OUawa, '76 Total Departmental Con-; tingencies at Ottawa, '76 $ 991 956 2,142 1,209 3" 2,414 4,677 551 453| 13,704 1875- "S tr. $ 11,075 5.496 10.852 11,971 12,743 10,345 5.644 8,715 16,611 706 19.375 17.453 40,872 11,059 ".559 17.851 212,327 90.000 302,327 o y a $ 1,856 1,100 1,90a 720 1.370 3400 5.838 1,697 3.541 14.183 2,717 499 38,821 1876. u o I B O O $ 15,822 4.554 .4,996 5.971I 7,650 6,138 3.669 5.907 14.398 709 »7.234 11,320 31,820 13.500 11,911 16,003 171.602 130,000 301,602 ei X $ 2,673. 325 932 2,162 9 1,820 8,287, ».433 1.578 6,890 3.785 1.757 31,651 ■( 1 I 1 ITIILIC EXPKNDITURE. 4.fi The payments lo extra clerks in 1875 were all but three times as mucli as in 1873, and nearly two-and-one-half times as much in 1876 as in 1873. It has been alleged throughout the length and breadth of the land that the in- creased expenditure in the departments was due to the supernumeraries ap- pointed by the late Government before they retired ; but the foregoing state- ment tells a different tale, and fastens the responsibility of the increase upon the present Administration. The next statement I submit is upon a subject which I, as a layman, feel some delicacy in criticizing — the Administration of Justice. I must, however, call attention to it, for the increased expenditure under this head is enormous: — DkTAILS 01 EXPKNDITURE ADMINISTRATION OF JUSTICK. Itkms. O.NTARIU. Court of Error and Appeal. " Queen's Bench . . . " Chancery " Common Pleas. . . County Judges Circuit allowances Total Ontario QUKHKC. Court of Queen's Bench . Superior Court Court of Vice-Admiralty. Circuit allowances Total Quebec, Total Nova Scotia " New Brunswick " Manitoba and North-West. " British Columbia Miscellaneous Prince Edward Island .... Supreme Court 1873- $ 2,166 14,500 14,108 14,500 104,521 11,900 161, 6g6 24,152 78,774 3,031 13,826 32,500 33,649 6,350 37,318 7,666 Total expenditure on Administration of Justice, 1873 Total expenditure on Administration of Justice, 1875 Total expenditure on Administration of Justice, 1876 $398,966 1875. $ 20,999 15,999 15,999 15,999 117,877 11,800 $ 198,676 25,999 112,743 3,031 11,632 32,449 36,699 13,949 42,991 4,154 15,077 $497,405 1876. 20,999 15,999 15,999 15,999 117,896 11,600 198.496 25,998 1 13.201 3,036 9,210 119,784 I 153,406 151,445 34,099 36,788 16,884 40,527 14,991 15,199 35,657 $544,091 The Court of Error and Appeal for Ontario down to 1875 was composed of the nine judges of the Superior Courts of the Province, and was presided over by a retired Chief Judge, whose pension was three-fifths of his former salary ; and the sum paid him as Chief Justice in Appeal — Two Thousand 50 PUBLIC EXPENDITURE. Dollars — made up his salary to what it had been before he retired fron^. the Chief Justiceship of one of the Superior Courts. This was the condition of affairs down to 1875, and the cost of the Court to the country was only Two Thousand One Hundred and Sixty-six Dollars a year. Hon. gentlemen who are not aware of the facts may imagine that this Court of Appeal did its work inefficiently and unsatisfactorily. But the truth is the very reverse of this. So satisfied were suitors, as a rule, that but few of its decisions were appealed from to the Judicial Committee of the Privy Council, and no one of its judgments has ever been reversed. The Judiciary of Ontario occupies a proud pre-emmence among the Judiciaries of the Colonies of the British Empire: no one of the judgments of the Court of Appeal of that Province has been reversed. Hon. Mr. Scoit said the Court of Error and Appeal was constituted under a statute of the Ontario Legislature. Hon. Mr. Macpherson — I am quite aware of that, but Ontario did not not appoint the judges or assign the salaries. I do not believe the Minister of Justice would attempt to evade any of his responsibility in this matter. ' Hon. Mr. Scott — We could not have controlled it in the slightest degree, Hon. Mr. Macpherspn — I am aware the present Minister of Justice was not in office when the Court was constituted and the judges were appointed ; but will the Secretary of State say that Court was constituted without the express sanction of Mr. Blake ? Hon. Mr. Scott said on the same principle the Minister of Justice would be held responsible for the appointment of additional judges in Quebec the following year, and for the appointment of County Court Judges in Nova Scotia. Hon. Mr. Macpherson — There is no analogy between the cases. The Minister of Justice does not possess the same influence in Quebec or Nova Scotia that he does in Ontario. He is not the leading member of the Bars of those Provinces as he is of the Bar of Ontario. No Legislature of Ontario would have ventured to constitute a Court for that Province without the •express sanction of the present Minister of Justice; and no judges would have been appointed without his being consulted. One of the charge! against the late Hon. Sandfield Macdonald's Government in Ontario was, that it held too intimate relations with the Dominion Government of that day. I am not aware that any fact has ever been brought to light to prove that those re- lations were prejudicial to the public interest. Can as much be said for the present Government of Ontario and the Mackenzie Administration ? The cost of Sir John Macdonald's Court of Appeal for Ontario was Two ' Thousand One Hundred and Sixty-six Dollars a year ; the cost of the new Court is Twenty-one Thousand Dollars a year, and this doe? not by any means represent the enormous increase in the cost of litigation, caused by the changes.* When the Government of the day intended to create a Supreme Court for the Dominion, at a cost of Thirtj'-five Thousand Six Hundred and Fifty-seven Dollars, they should not, I submit, have created a Court of Appeal for Ontario, but should have appointed additional judges, if necessary, in the existing Courts. I believe there never was such an opening for law reformers in Ontario as at present. In saying this, I do not wish to detract many way from the Minister of Justice, who stands at the head of his prcj- * The changes in the system of judicature, effected by the present Government of Ontario anct of the Dominion, promoting, as they do, appeal after appeal from Court to Court up to the Supreme Court at Ottawa, have increased enormously the cost of the .\dministration of Justice to litigants as well as to the public. ■' puj;lic extendi ruia; 51 fessioii, and it. ii great lawyer ; but history tells us that all great lawyers have not been successful law reformers. I now come to the expenditure in the Customs Department :— ' Customs — Details of Expenditure for 1873, 1875 •^'^'" ^^^7^ .^ . „ ._.._., _ . Provinces. ^873- r875 1876 Ontario $183,505 Quebec New Brunswick Nova Scotia Alanitoba British Columbia Prince Edward Island, Miscellaneous 176,985 73.353 93.970 8.35-' 24,477 7.033 $217,051 196,592 94,716 100,712 '2,039 19,056, 22,727 19,7801 $226,874 2x1,285 93.457 105,098 12,989 23.3^3 25,548 2 2,434 Total Expenditure for 1873 $567,675 Total P:xpenditure for 1875 ' $682,673 'J'otal Expenditure for 1876 $721^008 of Ontario Court up tf* nistration of It will be observed that while the revenue from Customs has very greatly decreased, the cost of collecting it has steadily increased. The cost of collecting this branch of the revenue in 1876 was Thirty-eight Thousand Three Hundred and Thirty-five Dollars more than 1875, while the revenue for the same period fell off Two Million Five Hundred and Twenty-Seven Thousand One Hundred and Seventy-four Dollars. The present Government is of course alone responsible for the expenditure of last year, and I should like to hear a reasonable explanation of the increased cost of collect- ing the Cu.stoms revenue. • I will take the Excise Department next. Under the circumstances it is extraordinnry. In it the expenditure has been as follows : — Excise— Df.tak.s of Exi-kxhiture for 1873, 1875 and 1876, •|F.\iS. L 1873- i''^75- 1S76. ONIARIO, Salaries Contingencies Total Ontario . . . ^ QUEBEC. Salaries . . . .• Contingencies Total Quebec . . . $76,791' $94,066 $92,119 12,005! 16,891 24,030 30,051 37.619 39,250 ■Oi ■H 52 PUBLIC EXPENDITURE. \'i^u^-( Continued). NOVA SCOTIA 7,275 3,455 Salaries . • • • Contingencies Total Nova Scotia NEW BRUNSWICK Salaries . • • • • Contingencies 6,885 1,380 Total New Brunswick Total Salaries.... •• Total Contingencies Manitoba • • • •. British Columbia • • • • Prince Edward Island General Expenses... 8,265 37,628 36,766 4,253 6,208 3,829 29,675 36,900 , 1073 ' $inJ04 Total Expenditure for 1873... Total Expenditure for 1875 '''^^_[.' \ $218,359 Total Expenditure for 1876 ' ' ' ^ ■ Total b P ,__^^ ,_.,„,ent has largely increased that the expenditure in :^.^.^^^^^^^f^rr expenditure^. .„ ,he Depanment onmm^g^"™ a»d Q ^a. I now come to tne u v ^. Q^yg ' l^^.. has been spent^by^ Jj;^; Minister at the no money era.oiCanad.pubfehed;X Sin tell the H°"^^ "J'-f^^ie then Agent-Genena o^ -■. ^;^^..„ ThefoUowmgletteMr^^^j^ j_^,y_ ,8,5 when the 'J^irvfyrae.i.tatioi to Canada: must have ..EMIGRATION TO CANADA. of the Times, an v ntimation .. who have lately armea j^^y at so l^^^. ? J,_u„tvv of artisans, mecnani ^ " "^^^ i^Sble'^trerour^^^^^^^^^ ^^o taSg ^Vr^cf ^^eS -pW- .. not advisable to en Canada. ^^'^^^PrLg of trade and a l^c^ oi . ^^^^^ ^,, .. and general labourers ^^ ^ depressed state ^f.^eliancc, o'^ f ^J^^a to face a ..beginning of A"g"''?Xve extraordinary energ^^ an ^y^emselves ^"^eeQ ..ment; and unless hey^av^^i^^^^ble time, theym^ encourage en^^^grat°"°,„ ^^^ i I ,275 ,,455 ),730 6,885 1,380 8,265 37,628 36,766 218,369 increased It is \crease in I believe auntry has epartn^ent ibUshed in n England, an intimation The advices om gentlemen commerce ana 3n season, it >s chanics, clerk?, f July ov in the eneral employ - icient means trced to face fi ^ration of such fsastrous to ihf \vised that there IM'BI.IC EXPENDITJ E. 53 *' is still one interest which continues to flourish, ami that there is still a healthy demaiul *' for agricultural labourers. I do not. therefore, desire to discourage the emigration of these " classes, provided that they do not take out with them large families But still I deem it " advisable to announce that the '.'anadian Government will not press during the approach- " ing autumn for a large exodus e7en of these classes. For female domestic servants there " is always a demand, at good wages in Canada, and it would be safe for them to go at any • time. I am assured that in a few months the unsatisfactory condition of tiie labour " market in Canada will have been greatly altered, and I hope soon, in view of the public " works which are projected, and the increasing prosperity of the Dominion, to be able *' again to recommend to English labourers of all classes the selection of Canada as their " home. In the meantime, the efforts of the Canadian agents will be devoted, during the " autumn and winter, to preparation for a large emigration in the spring, and I shall cause " registers to be opened by the Government agents in all parts of the country, to which " laborers of all kinds may send their names, descriptions and copies of testimonials, which " will be forwarded to the Government agents in Canada, with a view to enabling them to " transmit to this office any offers that may be made by the local employers to secure the " services of such persons. The details -of this arrangement, however, will be otherwise '* announced. " 1 am, sir, your obedient servant, "EDWARD JENKINS, " Canada Government Buildings, " Agent-General, " Westminster, July 9." In the fa.ce of such a circular as that, how could we expect immigration to flow into this country? Could anything be more ill-advised, or exhibit greater ignorance of the field which Canada offers to immigrants ? This country is specially adapted for workingmen with large families. It will cost the country a large sum to restore the stream of immigration diverted by this unwise advertisement. It gives to the Immigration Agents of other countries a strong argument against Canada. The following statement shows the expenditure of the Department, and the cost of the immigrant pif capita : — Details of Immigration and Quarantine for 1873, 1875, and 1876, Items. Total expenditure Quarantine items Total in 1876 on account of Mennonites: Transport Loan 1873- 1 1875. $277,368 11,871 $302,770 13,768 Total number of Immigrants by the St, Lawrence route for 1873 36,901 Total number of Immigrants by the St.i Lawrence route for 1875 1876. $385,845 12,233 38.761 57-670 5^96.431 Total number of Immigrants by the St. Lawrence route for 1876 Cost per head in 1873 ■Cost per head in., 1875 •^Cost per head in 1876 16,038 10,901 $18 90 * $26 55 *This is based on expenditure, less the amount paid to the Mennonites. Ailding cost of tniHsport of Mennonites, but excluding the loan, the cost per head of ail iinmigraiUs for 1876 was Thirty Dollars and Ten Cents. 54 ITRLIC EXPEND ITU UK. 1 Hi H '4 a f i 1 1 ■ In this statement 1 have not included the immigrants who entered Clanada by the Suspension Bridge — who were people passing through from New York to the Western States, or who came to reside temporarily in Canada, and whose effects were admitted duty free when they described themselves as settlers. ' The appointment of Mr. Jenkins as Agent-( ieneral was an unfortunate step. The immigration now is almost nominal, while the expenditure continues enormous; and why this is allowed I hope the Minister of Agriculture will be able to explain. Not only have large sums been paid to promote immigration, but a large amount has also been paid for emigra- tion, or what is called eu]jhoniously "repatriation." When repatriation was- first s])okt.n of in this country, 1 understood it to mean encouragement which was to be offered to French Canadians who had left Canada for the Ignited States, under a misapprehension, and who desired to return and settle in their own country, but had not the means. But if there was a willingness to do this. I did not sujjpose that Canada was going to assist people to return to Europe. The expenditure was voted by Parliament for the purpose of bringing people into the country, and not for sending them out of it, but I find in the public accounts that the sum of Five Thousand Four Hundred and Sixty- four Dollars and Forty-nine Cents has been exjiended in aiding foreigners to return to their native land. I consider such expenditure most unwarrant- able, because there are ample opportunities afforded to industrious people to- make a comfortable living for themselves and their families in this country. The expenditure was unwise, and was a misapj)lication of the money nf the tax-jjax ers of this country. The next matter of detail to which T will call attention is the expenditure under the Weights and Measures Act This measure was passed by the late Government, and the then P'inance Minister. Sir Francis Hincks, estimated the expenditure at Fifty Thousand Dollars ; but it has cost Ninety Thousand or One Hundred Thousand Dollars a year since it was put in operation. Hon. Mr. Scotj — The fees are not credited in that account ; they are paid into the Consolidated B'und. Hon. Mr. Macpherson — The present Go\trnment was premature in putting this Act into operation. There was nothing in the Act requiring that it should go into operation until the country was prepared for it. It required the proclamation of the (iovemor-General to put it into operation., and that ]jroclamation must have been issued upon the advice of the present Government. I think the Government will find it a difficult matter tO' justify this expenditure. The truth is that wherever it could be done, or under whate\er Act it was possible to dispense patronage, it was dispensed,, and every plausible excuse was advanced to justify and excuse it. The con- sequence is the enormous increase in the public expenditures under the auspices of the present Government, to which 1 am now calling attention. Hon. Mr. Scon- There were certain limitations in the Act as to the kind of weights and measures to be enforced after 1874. Hon. Mr. Macpherson — It was not obligatory on the Government to enforce the new Act until the circumstances of the country rendered it. desirable. The next statement which 1 propose to submit will be interesting in? itself rather than reflecting upon any Government. It is a comparative statement of the public debt and the interest thereon .since 1873 : are r-r — itni^t — • —.— ■ rUBI.lr l»KBT ITHIJC K\I'KNJ)ITURK. COMFARATIVK SlAlEMKNT, PuBLlC DeBT ANjU Lm KkEM. Totals. Increases. 'jIxtkrestonDkbt.! Toi \i.s. Total debt, 1873. . . Total interest, 1S73. 5,649,374 $ 129,743,432 i Increase. '73 to '74. ' 11,420,119' In«:rea8e, '73 to 74 Total "debt. 1874. . . ! 141,163,651 'Total iinercsi, 1.S74.! 6,122,844 Increase. '74 to "75 ! 10,499,850' llncreasc, '74 to 75 Total de))l, 1875.. ..I 151,663,401 Total interest, 1875. 6,340,056 Increase, '73 to "76.1 9,641,286 I "^'■^*^^'- '5 '" ''* Total debt. 1876 ...1 161,204, 687' ilTotal interest. 1876. 1 6,763,171 Total increase of debt in 1874. • 1875, and 1876 31,461,255! Total increase of interest in 1874, 1875, and 1876 3i> Increases. $ 673,470 217,212 413.116 1,203,79 Hon. gentlemen know that interest is charged against the Consolidated Fund; and since the 30th of June, 1873, the increased amount of interest charged to that fund has been One MiUion Two Hundred and Three Thousand Seven Hundred and Ninety-se\en Dollars — not the annual increase, but tlie total increase of interest during those three years. Hon. gentlemen will here find a confirmation of what I have stated — that the burthens of the people are not being lightened, but grievously increased. My next statement will show the annual expenditure on account of the public debt since 1873 : — Annual Expenditures on account of Public Debi co>rPARKD si\t:r. 1873. 1873- 1874. I 1875. 1876. $ $ Interest Management and Exchange Sinking Fund 5,209,205 5,724,4361 6,590,790 178,644 264,6831 227,200 407,826 5J 3.920; 555,773 $ 6,400,902' 208,147 822.953, Total Expenditure on account of Public Debt in 1873 $5,795,676' Total Expenditure on account of Public Debt in 1874 $6,603,039 Total Expenditure on account of Public Debt ni 1875 V ' $7,373,763 Total Expenditure on account of Public debt in 1876 $7,432,002 Hon. Mr. Wilmot — I should like to know whether the amount paid into the Sinking Fund is an asset ? Hon. Mr. Maci'Herson — It is an asset in a certain sense, , but can oC PUBLIC KXFENDITURE. not be used. It is so much paid in and accumulating to pay the debt. It is chargeable against income. The interest, Sinking Fund antl other charges amounted to Seven Million Four Hundred and Thirty-two Thousand and Two Dollars for the year ending the 30th of June last, being an increase of One Million Six Hundred and Thirty-six Thousand Three Hundred and Twenty seven Dollars over 1873. Hon. Mr. Scott — Chargeable to this Government? Hon. Mr. Macpherson — The loans were negotiated and the expenditure made under this Government. I do not intend this statement as a reflection on any Government, though the expenditure has been incurred by the present Administration. My object in submitting the statement is to call the atten- tion of Parliament and of the country to the enormous rate at which the bur- thens of the people are being increased. I do so in the hope that the Gov- ernment, Parliament and the people will see that they will have to be prudent, and that they should hesitate before they expend Twenty Million Dollars between Lake Superior and Red River, which would increase the annual taxa- tion, for interest alone. One Million Dollars, to say nothing of the enormous annual loss that would result from working the railway. i ii Increase of Annual Expenditure on account of Public Debt since 1873. Increase in 1874. Increase in 1875. Increase in Increase 1876 1876. ' over 1873. Interest pnid on Public Debt. Management and Exchange . :8inking Fund $515,231! $866,354!JecTea.se 18i>,8»8 86,039 decrease 37,483 decrease 11>,0.5S 106,094! Total increases ... I^ess for decreases $707,364 41,853 $908, 207 37.483 267,180 $267,180 208.941 $58,2391 $1,191,697 29,503 415.127 $1,636,327 Net increase in 1874 $707,364 Net increase in 1875 $870,724 Net increase in 1876 -Net incrense of 1876 over 1873 j $1,636,327 ,. 1 ask tlic hon. gentlemen opposite if this increase in the annual burthens in connection with the public debt is not a serious matter ? I look upon it with alarm when I consider the unprofitable and useless objects for which this ■capital is being expended. Hon. Mr. ^^■ILMOT — Hear, hear. Hon. Mr. Macpherson — I will submit a comparative statement of expen- diture charged to capital account in the years 1873, 1874. 1875 ^^^ 1876; also a comparative statement of Revenue and Expenditure since Confedera- tion, showing the surplus or deficit for each year, and a statement of Capital Expenditure for the same jjeriod. These statements are interesting in themselves : — PUBLIC EXPENDITURE. 57 Items ok Fapf.nditure CHARr.ED to CAPiTAf. in Pihiic AccoirNT?!, IN THE YEARS 1873, 1874, 1875, AND 1876. 1 TOTALH. CuiialM Namk ok Work. 1878. 1874. 1875. 1S7(1. 9 3,445,290 Wellund Canal. 691,031 jLauhine Canal 82,17H|neaiihamol8 Canal 7)H,3U5:Curillon and Urenville CanaU .. . . 9,448 H?ie Verte '260,167;CarilIon and Chute ii Blondean.. 70,316i8t. Ann's Lock H,47;JRideau 140,601 Lock at Culbute Rapids 2,416 Chaiubly t 82,282 7,824! 38,241 1 132,822 1 4,877 376: « 746,420 168,618 20,641 190,323 4,018 54.9:<6 12,7o3 11,146 60.216 8t. Peter's St. LawTence # 1,047,119, 197.42o| 22,391 249,612 443 )»0,3.S2 32,627' 9,310 im,U69i 2,415 20 Parliament ) BtiiUlings ) ' , Fiicific Railway . 6,659,137 /'Library I Tower and i;{round , tl92,792' ; Walls and workshops I i ExtenBion West Block I \F\re walls and water ser\ice. 36,931 03,585 49,6041 86,869 1 42.941 47,868 48,070 27,264. 23,368 .2,137,692 83,040 2,724,201 3,544 216,844 113,056 195,370 179,804 1 11,394 6,764,S44| Survey I 501,818 310,2241 474,529 Fort Frauds Locks 7,411 Steel Rails ,...! I 1,012,789 Sundries ; 3,644 Telejfraph line I ' 28,500 Lake of Woods and Rainy River..' ' I Fort Garry and Pembina ' 19,406 Fort William to Shebanduwan , ; Oeoijfian Bay Branch 8 1,509,478 327,709 221,708 110 104,404 24,935 2,163 76,842 11,125 .'^p0,215 40.067 78,088 12,670 100,000 37,013 791,121 76,529 1,711,412 "187,284 118.055 175,965 175), 804 111,394 North- West Territories. 63,238! .Intercolonial ... Government Railways.. . 11,889,295 88,632 1,279,309 Intercolonial 4,827,183 3,417,001 2,046,460 998,91tl P. E. I. Railway Nova Scotia and New Brunswick . . i 192,066 Total spent ) 1 a, ao, .,-, 1873t<>1876f -r"' ''^^ 197,236 40,080 780,0;« 42,640 109,380 Totals <(,OOS,'MO »,'i54,«98i6,»'.;:),lK.'i 7, l.'t4. 1 18 CiENERAL Summary. I, TOIALS. Itrms. 1873. 1874. 1875. 1870. 5,.-.59,145iCanal Works 5,828,0821 Pacific Railway 11,889,326 Intercolonial Railway 1,279,259 Gov't. Railways, N. S. and N. 88,032 P. E. I. Railway 092,708 Parliament Buildings , !||t 201,430 025,066 4,827,183 192,055 1,193,(508 310,224 3,417,007 107,230 99,510 13.S063 X » 1,715,208 2,388,839 1,540,238 3,346,664 2,»i45,474 999,001 780,038 109,330 40,680 42,546 189,481 207,888 26,.'J37,241 'Total Fx|ienditure charged to Capital ini I Public Accounts in 1873 |6,006,240 Total Expenditure charged to Capital in Public Accounts in I«J4 ;6,264,698 i Total Expenditure charged to Capital in Public A.'counts in 1875 6,923,186 I I Total Expenditure charged to Capital in j Public Accounts in WTO i 7,154,118 N.B. -Total for Intercolonial to 30th June, 1876, Twenty-one Millions Five Himdred and Eighty-two Thousand <)ne Hundred and Eighty-eight Dollars. Total for Pacific Railway to same date Six Millions Two Hundred and Mfty-four Thousand Two Hundred and Eighty Dollars. These amounts include expenditure previous to 1873, not shown above. % 58 X M u a u !> (d g O H > < < Hi o o I 00 I 4 I 00 I 1^ I I ! 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A portion of the public burdens lUily be changed from one j)Ltth (tl 1H74 : — "The legislation of last subsion addcU over One *' Million I'ivf Hundred Thousand Dollars to the fixed charges of thecoun "try." The sum of Two Millions of Dollars in schedule A of the Supply Hill of 1^74, charged against revenue, I believe was altogether for in creased expenditure which the revenue did not cover, and for which the present (iovernment is responsible. Hon. Mr. Scoi'i' — No, no 1 Our (ontcntion is that we enicrtd upon no new expenditures, and that it required Two Millions to meet Mr. 'lillt-rs deficienciew. Hon. Mr. Maci'hkrson— 'I'he Public Accounts do not bear out that state nient. There was a large expenditure in 1875 and 1876 upon w(jrks which had not been conmienced in 1873 or 1874. The (iovernment have, un- •luestionably, been extravagant and reckless in their expenditure. I'hey have disregarded the pledges of retrenchment and economy ujjon which they came into power, and placed the country in financial peril by not [iroviding for the deficit which resulted from their miscalculation, as soon as they discovered it. The expenditure of 1876 over 1875, for which they alone were res]jonsible. amounts to Seven Hundred and Seventeen Thousand and Sixty-Two Dollars. The object I have in view in bringing this subject under the notice of the House is to show the enormous increase in the controllable expenditure during the last three years, for which the present Administration nmst neces- sarily be held responsible. This expenditure increased at the rate of Six Hundred Thousand Dollars per annum ; or One Million Flight Hundred Thousand Dollars in the three years. 1 have given them credit for tlie expen- diture resulting from the legislation of 18 73. Ihe actual increased expenditure of 1876 over 1873 was Three Millions Six Hundred and Sixty-seven Thousand Three Hundred and Ninety-eight Dollars, of which the present Finance Minister alleges One Million Five Hundred Thousand Dollars resulted from the legislation of 1873. 1 accept this statement as correct, and I allow Three Hundred and Seventy- seven Thousand Three Hundred and Ninety-eight Dollars in addition, which is a liberal allowance for reasonable and necessary increases. The balance — nearly Two Millions of Dollars- -therefore is the amount of the increased controllable expenditure incurred by the present Administration. The correctness of this statement is confirmed by the fact that the actual ascertained increase in controllable expenditure for 1876 over 1875 is Seven Hundred and Seventeen Thousand and Sixty-two Dollars, and tha< ear was entirely within the control of the present Government. This multiplied by three would give a considerably larger increase for the ' years than I charge against the Administration. , will refer to one other matter. In the Speech from the Throne, delivered at t(.^ opening of the session, the following paragraph found a place : — " Notwith- " standing the loss of revenue, consequent chiefly on the diminution of our " importations, the reductions effected during the current year have gone far " to restore ^he equilibrium between income and expenditure, though great " economy II still be needful to attain that object." 1 hope this will prove to bf case. This s( 11 was opened in the beginning of February, at a time when the Governmc knew that the revenue of the country was falling off; when they knew that vas then less by Three Hundred and Twenty-six Thousand Five Hundred a..d Six Dollars than it was at the same time last year. 1 hey were aware that large additional amounts would have to be charged against the Con- solidated Revenue Fund for the increased public debt, that at least Six Hundred Thousand Dollars per annum had been added to it for interest on the new loan negotiated at the end of last year ; they knew it was being added 10 62 IM FBLTC KXPKVDFTITRE. otherwise, and that, too, in the face of a decreasing revenue which rendered it almost certain that the end of the current financial year would show another deficit instead of any restoration of the equilibrium between revenue and cxiJcnditure. I am not, however, going to charge the Ministry with having put words in the Speech from the Throne which they did not believe to be strictly true. To do so would l)e to charge them with a very grave offence, as great an offence as the advisers of the Crown could commit, foi it would be first deceiving the Crown and then employing the Crown as their medium for deceiving and misleading the people. 1 will not accuse the Government of this offence, but hope, f' . the sake of the country, that the result will prove Lhe correctness of the woiJs placed in the Speech from the Throne. I shall, no doubt, be charged with partizanship, as I have been before, when I have i;alled attention to the shortcomings of the Government; but the only partizan- ship I have in this matter is in favour of efificient administration.* This is my only motive, and I think my course in this House while I have had a seat in it entitles me to expect that my statement will be accepted. I expected an efficient and able administration of the public affairs from the present Government. I put faith in their pledges of political purity and financial retrenchment ; but I have been sadly disappointed, as the country has been. * Holding a position independent of parties, as I have always done in the Senate, and criticizing measures f;eelv, ir. the public interest, as I believed, it has been my fate to be charged with partizanship by both Governments, each in turn charging me with being the partizan of ti'-e Opposition for the time being. My study has been to be the partiza.. of neither. ' ' I '.;'''/ . • > .. ." I'l'! , ■ ' ■n, r'l ed ler nd )Ut tly sat rst for of )ve ill, ive m- > is ad ed. the nd try and ged 1 of s IP E E o h: ON THE TARIFF AND LOAN. — DELIVERED IN THE SENATE, OTTAWA, ON FRIDAY, APRIL 27TH, 1877. I am sorry I cannot allow the Bill to pass at this late hour without detain- ing the House a few minutes. Changing the Tariff at any time disturbs the trade of the country very seriously. The changes proposed now are few and small — so small that it is impossible to justify them. They are so insignificant that the Government when introducing the Bill ought to have apologized for them. The object, 1 presume, is to increase the revenue ; and the Secretary of State should have told the Senate what additional amount of revenue was required, and how much the changes in the tariff were estimated to yield. There was a deficit of Two Millions on the 30th June last. The Finance Minister has not revised the estimates of revenue made last session during the present session of Parliament, so that the House does not know what he expects will be the result at the end of the present fiscal year. That information should have been furnished to Parliament. 'I'here can be little doubt that a new deficit will be found to exist at the end of the year. In view of the deficit of last year, and the certain accruing deficit of this year — amounting together to a very large sum, I fear — it seems trifling i<; make these changes in the tariff for the small sum they will yield. According to the estimate of the Finance Minister, submitted in another place, they will yield only some Four or Five Hundred Thousand Dollars. If it is intended to sup- ply the deficiency in the revenue by this slight increase of the taxation of the country, the increase is wholly inadequate for the purpose, and it is difficult to imagine any attempt more lame and impotent. The depression throughout the country is wholly unprecedented in the memory of any member of this House. All the enterprises of the country are stagnant and paralyzed. Our financial embarrassment and deficits are increasing. I do not hold the Gov- ernment altogether responsible for the' prostrate condition of commerce ; but I contend that if they had a policy, if they had even sympathy for the coun- try, they might mitigate the feeling of despondency which prevails so widely. I know that men of means who are disposed to embark in enterprises in the country are deterred by the fear that if they did so, and became suc- cessful, the Government would find some excuse for interfering with their prosperity by taxing them, or in some way acting prejudicially to their in- terests. It is a very unfortunate opinion or sentiment to be abroad in the country, but it is abroad, and it is not altogether without ground. The oft- referred-to sugar-refining trade is an instance in point. It was encour- aged until it became exceedingly prosperous, but so soon as that was the case it became the envy of many, and the Government, who had previously fos- 64 TARIFF AN I J J.OAN. tered it, turned against it and starved it. The direct tea irade was actually stamped out by Parliament at the instance of tWe present Government. The Secretary of State seemed to think lightly of this trade, because it em- ployed only one ship. Hon. Mr. Scott — Two, one year. Hon. Mr. Macpherson — Each ship sent to open trade with a foreign coun- try is a pioneer of the commerce of the Dominion. I suppose the great Eastern trade of the United Kingdom did not commence with a fleet such as is employed in it to-day, but with one ship. I am a free trader, but 1 believe that so long as we have to raise a revenue from customs duties, interests will grow up under the protection thus afforded; and the policy, whether sound or not, under which manufactures grow up should not be suddenly changed, so as to destroy new and important interests. The effect of an un- certain and changing policy is not simply injurious to the interests immediately affected, but it engenders feelings of uneasiness and distrust which prevent men from embarking their capital in enterprises in this country. 1 contend the people of the Dominion are now suffering from these feelings of uneasiness and of distrust in the Ciovernment. The Administration has manifested a desire to meddle in business matters between man and man, and its effect has been injurious. It would be well if the tariff could be understood to be fixed for a term of years, that people might know what they had to depend upon. The frequent changes that are made and the uncertainty that attends the tariff, are unfavourable to the crea- tion of neVf enterprises, and in this way injurious to the country.* The debt of the country is being increased with alarming rapidity and for unpro- fitable purposes. Sir Francis Hincks, in 1870, showed it was then Twenty- two Dollars and Fifty Cents per head. In 1873, Mr. Tilley said the debt, per head, had not increased. But in 1876 the debt had increased to Thirty- seven Dollars and Ninety-three Cents per head. The taxation had increised from Three Dollars and Fifty Cents in 1870, to Five Dollars and Seventy- six Cents in 1876; that was the rate of taxation paid last year, but it was not enough to meet the expenditure of the country; Six Dollars per head is now required. In 1873 Mr. Tilley showed that the duty paid on goods entered for consumption was Ten and One-fifth per cent ; in 1876 it was Thirteen and Fifty-four Hundredths per cent, showing the average duty had increased about one-third ; in other words every person had to pay one-third more duty on the goods consumed by him. Where each one contributed Three Dollars in this way to the revenue in 1873, every man, woman and child has now to contribute Four Dollars. We used to pride ourselves upon this being a cheap country to live in. I fear we cannot boast of that any longer. Our large unproductive expenditure is not only increasing our burdens at home, but is impairing our credit abroad. This was exhibited in the negotiation of the loan by the Finance Minister in October last. I do not intend to say one word in blame of the way in which that loan was negotiated. The first duty of the Minister of Finance was to make certain of success, because it -would have been unfortunate for th^ country if he had failed. But he was completely in the hands of the moneyed men in England. He had to be * In my opinion it is scarcely possible to overestimate the importance of imparting a character of stability to our customs and excise legislation. I think it might be done with- out unduly fettering Parliament ; and until it is secured money will not be forthcoming freely and confidently, for investment in industrial enterprises in this country. The experi- ence of the sugar refiners of Montreal will serve as a warning for a long time to come. Capitalists will not expose their property to the possibility of being experimented upon- as souices of new taxation — by Ministers of Finance. •■ '< r I :.JtMtt^l^J.»LaMg i mum T \ t TARIFF AND LOAN. 05 guided by the financial agents of the country, and although they might have advised him to place the loan at a low price, I would not blame them. The Dominion had no right to expect them to give us their money on better terms than they could obtain from others. We had no claim upon them, and when we went to them for a loan they treated us as a banker would a customer in this country. They would naturally ask what had been our success during the preceding year — what had been the measure of our prosperity. When this question was asked Mr. Cartwright, he must have told the truth — that there was a deficit amounting to one-third of the interest on the public debt, that there was a deficient harvest, and that the country was not as prosperous as it had been .when he had negotiated his loan in 1875. At that time he had been able to give a very flourishing account of the country and of the use that had been made of the money borrowed by the Dominion. In a statement issued by him in London, on the 19th October, 1874, placing the condition of the Dominion before the capitalists of the world, Mr. Cartwright said : — " The whole of the debt has been incurred for legitimate objects of " public utility." * * * * « 'I'he indirect advantage from these pub- " lie works has already been found in the remarkable rapidity with which the " commerce and the material prosperity of the Dominion have been developed; " while a substantial increase jn the direct returns may fairly be expected from " the improvements now in progress and to follow the steady progress of popu- " lation and trade. * * * * The revenue has shown a continuous "surplus during each year since Confederation, in 1867, although it has in " the interval been charged with much heavy expenditure of an exceptional " kind, such as the outlay connected with the several Fenian attacks on the *' country, the acquisition and organization of new territory, and providing an " adequate defensive force for the Dominion. # # * * 'i'he^eight years "since Confederation, therefore, exhibit an aggregate surplus of Two Million " Four Hundred and Forty-three Thousand One Hundred and Eleven Pounds "(equal to Eleven Millions Eight Hundred and Eighty-nine Thousand Eight " Hundred and Eight Dollars, and not including the sinking fund) which has " been partially applied in the redemption of debt, and partially expend- " ed in new works. The annual oayment for sinking fund is included " in the current expenditure, and forms in the aggregate a further sum of " Seven Hundred Thousand Pounds (or Three Millions Four Hundred "and Six Thousand Six Hundred and Sixty-eight Dollars) since Confed- "eration," When the last loan was negotiated, the Finance Minister was unable to say anything so encouraging, but had to admit the exist- ence of a deficit; and when asked what return he expected from the ex- penditure of former loans, he must have replied that an enormous amount was being expended in constructing a railway between Lake Superior and the Red River, through a country that vyas altogether unfit for settlement and where the running of the road when finished would be attended with constant and very heavy loss. The lenders of money in England are very like those who lend money elsewhere. They are very apt to follow it and see what is being done with it. I venture to say there is not a year when a good many of those from whom we borrow, or their representatives, do not come to this country to see what we are doing with the money they have loaned to us. Th«y will learn of the Fort Francis folly, of the large capital being hopelessly sunk in the railway between Lake Superior and the Red River, of the amount lost and locked up in the unfortunate steel rails speculation, of the contract for the Georgian Bay Branch Railway, and of several other unwise expenditures, to say nothing.of more equivocal transactions. While I do not blame the Finance Minister for the manner in which he saAv fit to issue the loan, I do — r ' ""0.j. 4-'Y ii 66 TAKIl'K AND LOAN. blame the Government for having brought the country to the condition in which it now is, and which compels us to borrow on such terms. I will state to the House what the terms really are on which the last loan was obtained. The loan, carrying interest from the first of November, was issued at Ninety- one. There was commission to the agents, One per cent. Then, by an extraordinary provision in the prospectus, the subscribers to the loan were allowed to deduct from the May instalment the six months' interest payable on the first of May. This was a remarkable condition. It was a direct pay- ment of interest out of capital. It would be difficult to conceive anything more objectionable from every point of view than this arrangement. It diminished the amount of capital which the country should receive for the loan ; it was a direct payment of interest out of capital, and without being passed through the books in this country, as it ought to hive been. The Minister of Finance did not call the attention of Parliament to it ; so that there was an absolute concealment from Parliament of a very important condition of the loan. it is unjustifiable that a portion of the principal should be withheld and applied to the payment of interest, as has been done in this case. The effect will be to mystify the Public Accounts, to conceal the true amount of the deficit on the thirtieth of June next ; and if this be done Parliament and the country will be misled as to the true state of the public finances by means which can only be characterised as a " cooking" of the Public Accounts. The loan was issued early in November last, at Ninety-one per cent, but carrying interest at Four per cent, pei annum on the full amount of its face from the first day of November. It was payal)le as follows, vi/,. S per cent, on application I ^.^, »t i . .. ^« o iL.,...,. «tli November. •5 20 20 20 on allotment j on 31st January, 1877. on 27th March, 1877. on 25th June, 1877. on 25th July, 1877. discount. ICO By the conditions of the loan the subscribers were allowed to withhold the six months' interest payable on ist of May, out of the instalment due on 25th of May, thus making it a payment of interest out of capital, and diminishing by the amount of such interest and sinking fund the principal sum to be received by the country from the loan. "^he deductions to be made are— Discount 9 per cent. Commission to agents i " Six months' interest due ist May, withheld .... 2 " Sinking fund, agency, i^c yC " 12 }4 per cent. The net proceeds, as nearly as can be ascertained, in the absence of precise information from the Government, would be, loan ^^2, 500,000 sterling, equal to $12,166,666 Less, for discount, for commission, for interest withheld out of capital, sinking fund, agency, &c., in all i2}4 per cent. . . . 1,520,833 $10,645,833 TARIFF AND LoAN. 67 To which will have to be added the amount received by the (Government for interest upon the instalments of the loan paid in between November and May, but which I have not the means of ascertaining. 1 think it may be safely assumed, however, that the amount the country will receive will not exceed Ten Million Seven Hundred and Fifty Thousand Dollars ($10,750,000), while it will be paying intere::t, sinking fund, (S:c., upon the full face of the loan— Twelve Million One Hundred and Sixty-six Thousand Six Hundred and Sixty-six Dollys ($12,166,666). The interest, sinking fund, &c,, upon this sum will amount to about Six Hundred Thousand Dollars ($600,000) a year, and be an additional charge of that amount upon the Con- solidatc^ T^pvc.iu? Fund, which will have to be provided by means of new and increased taxation. I will not detain the House any longer at this late hour ; bu« from what 1 have stated I think honorable gentlemen will agree with me that prudence in respect to the public expenditure is most necessary ; that there is an absolute and pressing necessity for the introduction of the letrenchment which the present Government promised, but has not given to the country. speech: ox STEEL KAILS — UKLIVERED IN THE SENATE, OITAWA, ON FRIDAY, APRIL I3TH, 1877. 1 ^ 7f li! 1 ii ii upon a motion of the Hon. Mr. Read, on the subject of the Steel Rails, Hon. Mr. Macpherson said :--I am not surprised that the Hon. Secretary of State should manifest considerable feeling on this subject, but he \\\\ have to hear a good deal more about the Steel Rails speculation. Hon. Mr. Scott — It was no speculation. Hon. Mr. Macpherson — It was a speculation, and a most unprofitable one to the countr)-, however profitable it may have been to some individuals. The Government manifested very little discretion in purchasing 50,000 tons of rails so long before any of them will be required — in purchasing rails for 550 miles of the Pacific Railway before one mile of it was located or sur- veyed. Hon. Mr. Scott — 10,000 tons went to the Intercolonial Railway. Hon. Mr. Macpherson — That was an after-thought. The money which was applied for the purchase of them has been charged to the Pacific Railway. That was just one of the evils proceeding from this kind of speculation. The Government, finding it had committed a great blunder, assigned 10,000 tons of the rails to Railways in Nova Scotia and New Brunswick, involving an expenditure which would not otherwise have been incurred. If the Govern- ment Railways in the Maritime Provinces had remained in the hands of the Provincial autl" orities, does any one believe that 10,000 tons of steel rails would have been laid upon them ? Hon. Mr. Scott — Mr. Brydges reported that they were necessary. Hon. Mr. Macpherson — The rails had been bought, and when it was found they could not be used for the purpose for which they were purchased, they were diverted to the railways in the Maritime Provinces. Two years have passed since the Government purchased steel rails for 550 miles of the Pacific Railway, and yet not one mile of the road is in operation. The hon. Senator from Belleville (Mr. Read) has stated enough, with what was pre\iously knov>ii, to render a committee of inquiry into this whole matter an absolute necessity. There is not time this session, but it should be under- taken as early as possible after the next meeting of Parliament. If there has been no partiality in the purchase and transportation of these steel rails, there has been a most unfortunate combination of circumstances calculated to excite suspicion against the Government, and it is necessary that the whole transaction should be cleared up. Coopei, Fairman and Co.'s name has again been brouL;ht before the notice of the House, now as agents for the !. mmmm'mimmmsMmi!^^ STEEL RAILS. G9 / ' \ contractors, and they were, no doubt, interested in the contract for transport- ing the rails. A member of this House was one of the partners in that contract. The independence of Parliament Act does not reach this Chamber ; but th ; honorable Senator from Hamilton should read the opinions expressed by the Minister of Justice upon members of the Senate being in any way engaged in transactions with the Government. The House will remember the attacks that were made upon a member of the Senate who had to dis- charge the duties of an important office, and who was appointed to this Chamber for the purpose of giving informatioji to the Senate and to the public with respect to the Intercolonial Railway. If the Minister of Justice censured that, what would he not have said if the gentle- man from Hamilton had had a lucrative contract with the Govern- ment, wliile holding a seat in this House? I will now bring to the notice of the House the actual cost of this steel rail speculation, so far as 1 can ascertain it, though I have not by any means all the items before me. It is no easy matter to find the items ; some are in the Public Accounts, some in the report of the Minister of Public Works, and a large number, I apprehenc', have not yet been brought into the accounts. The sum paid in England on account of the rails was Six Hundred Thousand Eight Hundred Pounds, equal to Two Million Nine Hundred and Twenty-three Thousand Nine Hundred Dollars : estimated freight to Montreal on 10,000 tons, Thirty Thousand Dollars ; making a total of Two Million Nine Hundred and Fifty-three Thousand Nine Hundred Dollars, as the cost of the rails delivered in Montreal ; the average cost per ton being Fifty-nine Dollars and Eight Cents. There was freight to Vancouver Island, Forty-eight Thousand Six Hundred and Sixty-six Dollars ;* inland transport charges and insurance, Two Hun- dred and Twenty-two Thousand Eight Hundred and Eighty-four Dollars. Then there is the interest on Two Millions Nine Hundred and Fifty-three Thousand Nine Hundred Dollars at five per cent, for an average period of two years, amounting to Two Hundred and Ninety-five Thousand Three Hundred and Ninety Dollars. I estimate the time at two years because the average will be found to be a great deal more before the rails are used, though it is a little leso to-day ; but before the cost ceases to bear interest, it will be twice that. The interest, added to the other figures I have given, brings the total cost of these rails, at the present time, to Three Millions Five Hundred and Twenty Thousand Eight Hundred and Forty Dollars. Now, these figures are perfectly appalling. Hon. Mr. Dicklk — How much is that per ton? Hon. Mr. Maci'Herson — Seventy Dollars and Forty-one Cents per ton. And the country has this enormous quantity of steel rails deteriorating at a rate that I cannot and will not venture to estimate, but which I know will be most serious. I am informed by parties who last autumn purchased steel rails of the very best c|uality, from the best makers, that they were laid down at Montreal this spring at Thirty-six Dollars per ton. Hon. Mr. McLel.'VN — I think the hon. gentleiuan must be in error. I notice the Government have paid at the rate of Forty-eight Dollars per ton this year for iron rails. Hon. Mr. Macpherson — That is no proof that I am in error. Hon. Mr. Hope — -Who agreed to lay down the best steel rails in Montreal at that rate ? • I have been given to understand that this item— although it is not so expressed in the return — isinchided in the amount of Six Hundred Thousand Nine Hundred Pounds paid in England. 70 STEEL RAILS. ^ Hon. Mr. Macphkkson — One of the best makers in England. Hon, Mr. Scott said he was informed that the Great Western Railway Company, at the time the Government purchased the 50,000 tons, had paid Eleven Pounds sterling per ton. Hon. Mr. Macphekson — The honourable Senator from Toronto (Mr. McMaster) stated that last year — no doubt for the purpose of sustaining the Government in their great speculation. The Ebbw Vale Company is regarded as a first-class house, and they sold steel rails, deliverable at Pres- cott this spring, at Seven Jgounds Fifteen Shillings (Thirty-seven Dollars and Seventy-one Cents) per ton. Hon. Mr. Scott — Iron rails ? Hon. Mr. Macpherson — No; steel rails of the very best quality. Hon. Mr. Campbell — Steel rails — I have seen the invoice. Hon. Mr. Macpherson — I allow One Dollar and Seventy-one Cents per ton for transport from Montreal to Prescott, and aill the cost of the rails at Montreal Thirty-six Dollars per ton. Hon. Mr. McLelan said this same company had furnished steel rails for the Intercolonial Railway, and they were tic- very best that had been laid on that road. Hon. Mr. Scott — The comptmy went into liquidation not long ago. Hon. Mr. Macpherson —They changed from a partnership to a corpora- tion ; but the company is one ol the largest in England. At no time have they fewer than 7,000 persons in their employment, and no ironmasters in England have a better reputation for furnishing rails of the very best quality than this same company. Hon. Mr. Scott — But their rails are not all of the same quality and pattern ? Hon. Mr. Macpherson — The quality of the purchase I refer to was warranted to be the very best. Now, the 50,000 tons purchased by the Government cost Two Million Nine Hundred and Fifty-three Thou- sand Nine Hundred Dollars ; but if they had waited until the present time — and, even now, they only require a small (jiim:.::\ — the rails could have been bought and dehvered at Montreal i ii * Uie Million Eight Hundred Thousand Dollars, showing a loss to the country by the specu- lation — by the purchase prematurely and imprudently made by the Govern- ment — amounting to One Million One Hundred and Fifty-three Thou- sand Dollars. Adding to this the interest, Two Hundred and Ninety-five Thousand Three Hundred Dollars, and freight to Vancouver Island, Forty- eight Thousand Six Hundred and Sixty-six Dollars, the actual loss to-day will be found to reach One Million Four Hundred and Ninety-seven Thou- sand Eight Hundred and Sixty-six Dollars, or say One Million anid a Half of ' Dollars. In addition to this, there is the inland freight and insurance, amounting to Two Hundred and Twenty-two Thousand Eight Hundred and Eighty-four Dollars, which was paid before the rails were wanted. This enormous blunder will be a lasting charge upon the consolidated revenue fund of Seventy-five Thousand Dollars a year, at least. In addition to all this, I understand there is a small army of care- takers and laborers employed about the rails, and the rails are deteriorat- ing every day. Altogether, it is a most serious affair. The proper course for the Government to have pursued would have been to wait until the rails were required, and then to buy them at the market price, whatever it might be. As a matter of fact, had they done this they would have saved One and a half Millions of Dollars to the country. The present Government do not pretend to be more iban simple administrators, because they have over and )ty ! \ ■•sgmifmm^mKfmm * STEEL RAILH. 71 over again declared that they could not introduce any new legislation to benefit the country in its present state of great depression. In other words, there is nothing in the science of government known to them by which they can by legislation assist the industries and promote the progress of the country. From the information which is being gained from day to day, the steel rail transaction, I fear, is a fair average specimen of the administration of the Government. MEMORANDUM, SUPPLEMENTAL TO THE FOREGOING SPEECH. It is difficult, I repeat, to obtain the information necessary to prepare a strictly accurate account of the Steel Rails transaction. The details have to be extracted fiom several sources, a.nd they are not always given explicitly. Any statement of loss prepared now can, of course, only be approximate ; but the ultimate actual loss is pretty certain to exceed any estimate of it that has been presented. The expenditure for Steel Rails and fastenings as neaiiy as I can ascertain is as follows : — Paid in England, for 50,000 tons of Steel Rails, as per Parlia- mentary return, ;^6oo,8oo, (including freight to Canada of 40,000 tons, and to Vancouver Island of 5,000 tons) . . The freight to Canada on the remaining 5,000 tons, I estimate at Paid on account of inland transport charges, insurance, &c , Interest on ascertained payments to 30th June, 1877 $2,923,900 15,000 $2,938,900 222,884 271,365 . $3,433,149 Including inland freight, labour and other charges, which must have been paid since ist July, 1876, but of which we have not the accounts, the total amount disbursed by the Government must exceed Three Millions Five Hundred Thousand Dollars ! Interest is properly chargeable on all disbursements for materials from the date of payment until they are used in the Railway. I apprehend interest will thus be chargeable on the whole outlay in connection with the steel rail purchase for an average period of four years at least, which, on the amount at present known to have been paid out, will amount to Six Hundred and Ninety Thousand Five Hundred and Thirty-four Dollars. The Profit and Loss Account of the Government steel rail speculation may be taken to stand abcut as follcws, viz. : — II 72 STEEL RAILS. Cash paid in England for steel rails and fastenings $2,938,930 The same quantity could have been purchased, deliverable this Spring in Canada, for 1,800,000 Loss on first cost $1,138,900 Interest to 30th June, 1877, on ascertained payments 271,365 To this must be added the cost of 4,000 tons laid upon the Truro and Pictou Railway, a line that would not have been steeled had not the rails been on hand 235,120 (The Government has taken authority to transfer this Railway to Nova Scotia as a gift to a private Company.) Ascertained loss to the end of current fiscal year, 30th June, 1877 $1,645,385 Interest is running on at the rate of about $13,500 per month and is increasing — I estimate the further loss by interest before the rails are used at $419,169 It may be assumed that the country's loss by this unfortunate transaction, before the interest account can be fairly closed, will not be less than Two Millions of Dollars ! The Rails have be^,a distributed as follows : — 5,000 tons to Vancouver Island, where they are not required. 11,000 tons to Nova Scotia, 4,000 tons of which are to bs given away to a private Company. And the remainder are at various places from Kingston to Manitoba. 1 -r jjjijgg >0 oo oo is 30 35 69 3 a sipeeoih: ox HARBOUR IMPROVEMKN IS. — DELIVERED IN THE SENATE, OITAWA, ON TUESDAY, MARCH I3TH, 1877. Hon. Mr. Macpherson said : — I beg to move that an humble address be presented to His Excellency the Governor-General, praying that he will be pleased to lay before this House copies of the reports and estimates of the engineer upon the works proposed to be performed at the following ports or localities, namely : — Arisaig N. S. Annapolis N. S. Baxter's Harbour N. S. Bayfield N. S. Beach Point P. E. I. Beaver Cove N. S. Bedeque P. E. I. Canada Creek N. S. Chipman's Brook N. S. Cape Traverse P. E. I. Christmas Island N. S. Cove Head P. E. I. Grand Manan N.B. Hopewell N.B. Hall's HarboHr N. S. Liverpool N. S. Lingan N. S. Lingan Beach N. S. Musquodoboit N. S. Malpeque P. E. I. Montague River P. E. I. Nail Pond to Egmond Bay P. E. I. North Sydney N. S. Port Gilbert N. S. Pubnico N. S, Port Hood N. S. Richibucto N.B. St. Peter's Bay P. E. L Scott's Bay N. S. Tiuro N. S. Victoria Harbou: N. S. West Arichat N. S. Walton N. S. West Sandy Cove K. S. ■ I have given notice of this motion in consequence of seeing this list of thirty-four harbours which have been surveyed, and of which reports, plans and estimates have been sent to the Department of P 'blic ^yorks. I confess that I feel a good deal of alarm at seeing so great a number of new sites for harbours being reported on by order of the Public Works Department. Harbours are necessarily costly works, and I take it for granted, in the present case, that some of those proposed are mere inlets, to which little trade has resorted heretofore. The cost of im- proving these harbours will be followed by the establishment of custom houses, light houses, fog horns, and other expenses necessarily attached to harbour service. Considering that works of this kind are paid for out of revenue, and seeing that the revenue shows a deficit, I cannot understand how the Govern- * ' » 74 H A U HOU K I M »'H( » V EM KNT.S. incnt ran en/' ■\ 1 ' ! ' ( . 1 If U ' : ) J- "•> '1 v; I I :' 1 1 1 ( ' ( s IP E E c h; ON THK Bll.l, RKLAIINC; I'D IHE VIOLATIONS Ol' I'lIK I N DKI'KNDKNCK (>!• HARLIAMKNT ACT — DELIVKRKU IN THE SENAI'K, OTTAWA, KRIDAV, AI'Rll, 27111, 1877. I will give my reasons for objecting to the Kill in its present siia[)e. If it had been made a condition precedent to taking advantage of the [jrovisions of the measure, that gentlemen should vacate their seats, I should be willing to relieve them from the penalties they have incurred. 'I'here is, however, a very wide distinction to be drawn between some of the alleged cases and others. Those members of the House of Commons who have unintentionally and unwittingly violated the letter of the Act through the action of a partner or clerk; by selling a small (|uantity of merchandise to an official of the Government, perhaps uot knowing or suspec:ting at the time that the purchaser was an official, or that the |)urchase was for the Government ; or by printing a Government advertisement in a newspaper, occupy a very different position from those who know- ingly offended. It is alleged that gentleman occupying the highest positions 'in the other House, and in the country, hold contrads with the Government, some of them being, it is alleged. Cabinet Ministers. There is a vast difference between these, who, from the positions they hold, are able to enrich themselves at the expense of the couintry by many thousands ol dollars, and the men who have unknowingly violated the letter of the Inde- pendence of Parliament Act. I maintain that the Senate should not relieve. in any way whatever, those who are guilty knowingly and corruptly. If it be true, as is alleged, that high officials are Government contractors, drawing large sums of money from the public treasury, under contracts which it maybe said they made with themselves, they are guilty of most scandalous conduct, and I contend Parliament should not relieve them of the legal [jenalties which attach to their conduct. As I do not see that on this the last day of the session the Bill can be amended in such a way as to relieve the innocent and leave the guilty to punif!hment, I shall be obliged to record my vote against the Bill. m CHANGE OF OFFICES AT OTTAWA. f t N. B.— While these sheets have been passing through the press an unexpected shuffle of Cabinet ofiices has taken place at Ottawa, viz. : Mr. Laflamme to be Minister of Justice, v/a Mr. Blake, who has become President of the Council, vice Mr. Cauchon, who has become Minister of Interna] Revenue, ?vV^ Mr. L-j'amme. This exchange of portfolios cannot fail, for obvious reasons, to be deeply disappointing to the people of nearly the whole Dominion. In Ontario, I think, it is calculated to produce positive uneasiness, as indicating that the influence of Messrs. Mackenzie and Blake in the Government is on the wane — -the influence of the two Ministers in whom the friends o.'" the Gjvaranjnt in this Province placed their sole reliance. The changes are too important to permit it to be supposed that they are wholly due to the convenience, or choice,i|or ambition, of individual Ministers. I shall not impute' to Mr. B'.ake the taking from personal motives onl) of a step which he must ijhavej^known would derogate very seriously from the character and dignity of the present Government If the labor of Mr. Blake's late office was more thanj he could perforrft without imperilling his health, he might have appointed additional assistants, and in that way have made his own work comparatively light and easy. ( It would have been better in the interest of the country' If Mr. Blake had done this instead of exchanging an exalted office for lone of 'little or no responsi- bi 'tv — a mere sinecure. The Minister of Justice is charged with higher moral responsibilities than any other|jMinister|''of the Crown in Canada. Upon him devolves the maintaining, and when necessary the amending, of our commercial and criminaF law ; to him Parliament looks for guidance in its deliberations on all Constitutional and Legal questions : upon his recom- mendation all the Judges of the Dominion are appointed ; and it is upon his advice that the highest prerogative — -the prerogative of mercy — is exercised by the Crown. It is this o.lfice, with all its important and lofty attributes, that Mr. Blake has vacated in favour of Mr. Laflamme — an act which has filled 'he minds of the people of Ontario with amazement. No [one desires that Mr. Blake should overtask his strength in the public service; but it is difficult to believe ihat he could not have assigned much of the toil of his late office to com- ■•H CHANGE OF OFFICES AT OTTAWA. 77 petent assistants. While he has divested himself technically of the responsi- bility of the Ministry of Justice, Mr. Blake must be perfectly well aware that the people, especially the people of Ontario, will not be willing under all the circumstances to relieve him of moral responsibility to them for the adminis- trative acts of his successor, Mr. Laflamme, for whose appointment Mr. Blake must be held responsible. Toronto, June, 1877.