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FINANCIAL STATEMENT. 
 
 OF THE 
 
 HZOItT.. .A-. Dye. ItOSS. 
 
 Legislative Assembly, 
 
 Toronto, Friday, I3th Feb., 1885. 
 
 Mr. Speaker, — Before making the motion with whieli I shall 
 conclude, it is my duty on the present occasion to lay before the 
 House the financial position of the Province for the past year, and 
 to state what have been our receipts and expenditures, what are 
 our requirements for the coming year (for the present year, rather), 
 and also to make such references to any financial transactions of 
 the Province as may appear necessary to give the House a full 
 understanding as to how the Province .stands financially. First 
 I will lay before the House our receipts for the past year, 1H84, 
 which have been as follows : — . , 
 
 Receipts for 1884. 
 Dominion of Canada :—- 
 
 Subsidy $1,11«,872 80 
 
 Specific Grant 80,000 00 
 
 , ■ ^ . $1,196,872 80 
 
 Interest on Capital held, and debts due by the 
 
 Dominion to Ontano $207,903 86 , , - 
 
 Interest on investments 57 ,521 79 
 
 V'--' — '- 265,425 65 
 
 Crown Lands Department 57O 305 41 
 
 Algoma Taxes 2,215 86 
 
 Education Department |(37,069 35 ' ■ '^" ' »«-*-,*+: 
 
 . . do School of Practical Science 900 00 
 
 " " ■ ' "'-'' 37,969 a5 
 
 i I'ftw Stamps. .,,.,, <, .; (,,j^599 gg 
 
 I'icenses 211,353 71 
 
 Drainage Works Assessments 23,618 37 
 
4 FIXAMCIAL STATEMENT OF 
 
 Public Inntitiitions :— 
 
 Toronto Lunatic A«yhun *. \{VM 33 
 
 T.ondon do do 10,335 18 
 
 Hamilton do do 4,024 98 
 
 KingHton do do 3,31"J 38 
 
 Orillia do do 1,!»1G 10 
 
 Reformatory for Females 3,808 37 
 
 do do Boys 018 39 
 
 Central Prison 53,015 57 
 
 . .J ,. Deaf and Dumb In^titute 583 38 
 
 . $108,211 08 
 
 (Jomal Revenue .— 
 
 Fines, etc 84,776 29 
 
 Surrogate Court Fee« 016 00 
 
 Division do do 4,449 ()S 
 
 County do do 904 10 
 
 Insxuance Go's. Fees 450 00 
 
 ( )fficial Gazette 9,792 00 
 
 Ontario Statutes T. . . 524 54 
 
 .^ Private Bills 3,800 00 
 
 Provincial Secretary's Department . 7,389 80 
 
 - i Incidentals 003 98 
 
 33,420 45 
 
 Municijjal Loan Fimd 4 47(5 20 
 
 > Kingston L. A. Cap. Acct 753 35 
 
 Lock-uj), Rat Portage, do 20 00 
 
 Mimico Farm do 625 00 
 
 Agricultural and Arts Association, re alterations Agricultural 
 I Hall 2,000 00 
 
 •■;. . , „,, , ,, ,„,, ,,, ., $2,523,874 41 
 
 Dr^iinage Debentures .....!. 40 037 37 
 
 Annuities : — 
 
 Proceeds of Sale of $13,400 of 40-year '' '' ' '' ' ' ' ' ' ''' 
 
 anmxities $248,191 71 ' / « i "■ • ^ ■ 
 
 5 per cent, interest on $119,058 84, de- 
 
 posived to meet December certificates .. . 2,45196 
 
 250,643 67 
 
 <v; ^;f?^,;i«M ;;t Total '";_'' '$2,820,555 45 
 
 Now, hon. gentlemen will notice that I have made the classi- 
 fication a little different in this statement of receipts from that 
 which appeared in former statements laid before the House ; thus, 
 instead of including the interest on the funds held by the Domin- 
 ion as part of the subsidy, I have taken it into interest account, 
 to which it properly belongs, as interest on funds held to the 
 credit of the Province. 
 
THE HON. A. M. UOSS, 5 
 
 There are one or two matters in tliis statement to which 
 I wish to draw the attention of the House. In the first place, it 
 will be noticed bj'^ those hon. members who have the statement of 
 last year in their possession as to what our anticipated receipts 
 were, that we have received less by $81,038.78 than we antici- 
 pated. Last year I referred to the deficiency in our Crown Lands 
 revenue of 1883, explaining that we were then deficient by the 
 sum of $114,000 in what we had expected to receive from tliat 
 source, and calling the attention of the House to the fact that it was 
 owing to the depression in the lumber trade and the consequent 
 reduction in the amount received from timber dues at that time. 
 In making up our estimates for 1884, we hoped that we would 
 see an improvement in the year's operations, and we therefore 
 estimated that we would receive a larger sum than what we 
 realized in the previous year. I am sorry to say, however, that 
 that depression in the lumber interest has continued, in fact has 
 become rather more intensified than it was at that time, and 
 therefore there is a still further reduction in the revenues from 
 that source. 
 
 We estimated that our receipts from the different sources of 
 Crown Lands revenue would be $690,000, whilst they have only 
 been $570,305, or a deficiency in our revenue from that Depart- 
 ment of $119,695. Considering, Mr. Speaker, that during the 
 past year we have been passing through a period of depression 
 which I think is acknowledged upon all hands to have been more 
 severe than we have experienced for many years ; considering that 
 that depression, that dulness in trade, has existed not only in our 
 own Dominion but in England and the LTnited States, with whom 
 we have large trade relations, I think. Sir, that taking these cir- 
 cumstances into consideration, the amount that we have received 
 from that source may be considered very fair, although much less 
 than we had anticipated. ,;;' <j ii ■ . < jnj -. cwf •t'^ !;: j 
 
 Mr. Meredith. — I would ask the hon. gentleman if the arrears 
 due by the holders of timber limits are more than they have been 
 previously ? 
 
6 FINANCIAL STATExMENT OF 
 
 Hon. Mr. Ross. — I made the same enquiry myself. I believe 
 that they are, although I have not the figures to give the House. 
 I h>elieve it i." the practice of the Crown Lands Department not to 
 collect the dues, even although the timber is cut. until it is 
 disposed of or shipped, and in consequence of the depression, and 
 the lumbermen not being able to dispose of their lumber, the 
 arrears are, I believe, larger than they would otherwise have 
 been. 
 
 There are some lesser fluctuations in regard to the receipts to 
 which it will not be necessary to call attention. However, I dare- 
 say the House would like to know how oi'.r anticipations have 
 been realized in regard to revenues from licenses. We anticipated 
 a revenue from licenses of $200,000. It will be seen that we have 
 received no less than $211,353.71. From the statement that has 
 been handed in to me by the officers of the License Department, 
 it appears that our estimated revenue, which was based upon the 
 amount we might receive from Ontario licenses alone, has been 
 very nearly exactly what we anticipated. The amount derived 
 from the issue of licenses issued by the Ontario Board was $200,- 
 949.93, and we received ir addition $10,403.90 from licenses 
 issued by the Dominion Board, making the total of $211,353.71. 
 Jhe statement shows that the Dominion licenses were princi- 
 pally confined to ordinary hotel and shop licenses. There 
 were issued under the Ontario Board 3,217 hotel licenses, 
 and 182 by the Dominion Board. The numbei of shop 
 licen.ses issued by the Ontario Board was 666, and by the 
 Dominion Board 14. <- , . r, - • 
 
 It will also be noticed in the statement of rec /ts, that we 
 have a new item which did not appear in our form*> ■ statements 
 of Provincial revenues, viz., the amount of $250,643.67 from the 
 sale of annuities authorized under the statute of last session. 
 This amount is the proceeds of the sale of forty years' annuities 
 of the amount of $13,400 per annum, sold since that time, 
 under that Act. Tenders were asked for the purchase of those 
 annuities, and it was asked that the tenders should be for annuities 
 
THE HON. A. M. ROSS. 7 
 
 payable either in Canada or England. The most favourable was 
 one received where the amount was made payable in Canada, and 
 it was accepted, the rate being at a small fraction below 4i per cent., 
 say 4^ per cent. (Hear, hear.) Last year when I introduced this 
 matter, in making my financial statement, I stated that 1 
 anticipated that that would be about the rate at which we would 
 be able to sell our annuities, and I will quote my language on that 
 occasion : 
 
 "The Government believe thv3y can issue new certificates 
 upon a basis, at the very highest, of 4| per cent, interest. From 
 enquiries I have made I find those now in existence, wliich were 
 based upon 6 per cent., are being sold and ne;jotiated to give the 
 purchaser a rate of only 4| per cent. I thereiore think we are safe 
 in saying we will be able to issue new certificates on a basis of 4i 
 per cent." 
 
 That statement of what our expectations were was accepted 
 by the House as satisfactory, at least, no exception was taken as to 
 the price stated as likely to be realised. The price we have 
 obtained has been a very fair one, but at the same time if we have 
 to place future securities on the market, of the same character, I 
 expect that we shall be able to do still better. It may be asked 
 why we have adopted the annuity plan. Well, sir, one reason is, 
 and we think it is a reason that actuates most municipal institu- 
 tions, that it is better to have a portion of these securities rolling 
 due each year, and by that means avoid the trouble and expense 
 of keeping account of and re-investing sinking funds. We con- 
 ceive that the doing of this saves expense and cost connected with 
 these sinking funds, which are items of considerable importance. 
 It has been contended by some that it would have been better, 
 and that we would have been able to realise a better price for the 
 securities, had we issued them for an amount sufficient to take 
 up the whole of the outstanding railway certificates, viz., some- ' 
 thing over $2,000,000. That, I say, has been contended, and that ^ 
 by doing so we should have been able to sell them in England for ' 
 a better price than we obtained in this country. Now such a 
 
8 FINNCIAL STATEMENT OF 
 
 proposition, Mr. Speaker, would not, I think, commend itself either 
 to the House or to the countr3^ It was never intended, as I 
 explained when I introduced the measure, that we should, every 
 year, take up these railway certificates by the issue of fresh 
 annuities. That was not necessarily to be the case. It was only, 
 as I explained then, that from year to year as a deficiency in our 
 revenue might exist, we might, if necessary, renew these certificates 
 by the issue of new ones, but in any year in which the receiptss might 
 be sufficient to retire the old certificates, they might be taken up as 
 heretofore and paid out of our Consolidated Revenue Fund. It 
 would therefore have been very unwise to have issued new certifi- 
 cates for the whole of those falling due,some of them not for eighteen 
 years to come, merely for the purpose of getting a large loan placed 
 on the London market, and having the securities quoted upon the 
 stock exchange there. Another objection to that course would be> 
 that we know that the rate of interest is growing less year by year. 
 We know that a few years ago the Dominion Government was 
 obliged to pay 6 per cent, on loans made to them. We know that 
 they are now getting their loans for 4 per cent. ; nominally, the 
 issue is at 3^, but I believe the rate is really 4 per cent. The 
 old certificates which were issued by authority of the House, 
 and which we are now renewing, were based upon 6 per cent, 
 upon the investment, while those we have been selling are at 4|. 
 It would be folly, therefore, to anticipate by a present issue the 
 taking up of annuities not maturing for eighteen years to come, 
 but it is only by doing so that we would have effected a loan 
 of such magnitude as would enable us to place it upon the London 
 stock exchange. I may mention also that we received tenders at 
 the rate of 4| per cent, if the amounts had been payable in 
 England, and it may be asked why we did not accept a higher 
 tender payable in England instead of accepting a lower one pay- 
 able in Canada. I think, sir, it will be obvious to everyone that 
 it is much more advantageous, because we thereby escape many 
 charges for commission, brokerage, etc., that we do not have to 
 pay on those payable here. I say it is far better that we should 
 
THE HON. A. M. ROSS. 
 
 have these certificates payable at the Treasurer's office here, and 
 escape all those incidental charges which are connected with a 
 loan payable out of this country. I may mention that at the 
 present time the Dominion Government pay their financial agents 
 a commission of one per cent, for the placing of all new loans. 
 Besides that, they pay for brokerage, stamp duty, etc., one-half per 
 cent, more ; for all interest payable in England, one-half ner cont.; 
 on investments of sinking fund, three-fourths ^er cent., and on 
 redemption o loans, one per cent. In addition to that, they also 
 pay any losses incurred in exchange, in remitting money either to 
 or from England. Now all these commissions are saved to this 
 Province by our having these securities payable here at the 
 Treasurer's office, and all these things must be taken into account. 
 . Mr. Meredith. — Does not the purchaser usually re-sell these 
 securities on the English market ? 
 
 J Hon. Mr. Ross. — I do not know whether they are re-sold or 
 not, but that has no bearing on my argument. I am speaking of 
 what charges would be entailed on the Province were we to make 
 our loans payable there. If we did so, our interest would have 
 to be remitted there, our debentures sold there, they would have 
 to be redeemed there, and our sinking fund would have to be 
 invested there. -;:-':. ,< ..,i k.vt ^' '" '■'- ■ > - - , -- ,. ,.. 
 Now, I may just as well say in regard to exchange, that I find 
 that the Dominion Government remitted last year $5,116,790 to 
 England, upon which they paid as exchange or discount $15,863, 
 or three-tenths of one per cent, for the cost of transmitting the 
 money there. Then a portion of their sales in England 
 had to be brought to Canada to meet liabilities here. They 
 drew on their agents in England to the extent of $3,815,100, 
 and paid a discount of $28,499, or three-fourths per cent., for 
 getting the money here. These are very serious and heavy 
 charges, but the Dominion has to submit to them in consequence 
 of making their loans payable in England. Besides that, 1 may 
 mention that they maintain an officer there at a cost to the 
 country last year of over $10,000, who, I believe, it was intended 
 
10 FINANCIAL STATEMENT OF 
 
 should relieve the Government from many of these charges, but 
 he has not done so. ^r,*i:r<^Mv.'# 
 
 Now, Sir, as regards the price which we have obtained from 
 the sale of these securities, I have looked at quotations of securi- 
 ties as published in the Economist, and I find that similar securities 
 have been rated at about the same. I find, for instance, that Cape 
 of Good Hope debentures bearing four and a half per cent, interest 
 are sold on the English market at from 95 to 97 ; Mauritius bear- 
 ing four and a half per cent, are sold at 102 ; I find that New 
 Zealand debentures bearing four and a half per cent, are saleable 
 at from 101 to 103 ; I find Quebec debentures bearing four and a 
 half per cent, are saleable at from 101 to 103. These are all loans 
 payable in England, and you will see that although there is a 
 small premium to the extent of about one and two per cent., 
 that would all be absorbed by the first coat of making the 
 sale in England. So that I say, taking these as criterions, we 
 have received as good a price as has been obtained even where 
 they are payable in the old country, v, .^ . ,.AVi -T:*" 
 
 r-' There is one other item in the receipts to which I wish to draw 
 the attention of the House. It is the item of interest derived from 
 capital and debts held by the Dominion, $207,903.86. That 
 amount hon. gentlemen will see is $71,207 more than we have re- 
 ceived before. That was a half year's interest on funds placed to 
 our credit by the Dominion and paid in July under the Act passed 
 last year at Ottawa. It will be recollected that last year I drew 
 the attention of the House, in referring to the accounts that had 
 been submitted by the Dominion, to the fact that they had charged 
 us interest on the excess of debt between 1867 and 1873, before 
 t>hat debt was assumed by the Dominion. It will be recollected 
 that I contended that by the constr iction of the Act of 1873 we 
 were entitled to be relieved from that interest as from the date 
 of 1867. Hon. gentlemen will bear in mind that by the Confeder- 
 ation Act it was provided that the Dominion should become legally 
 liable for the whole of the debts of the old Province of Canada, and 
 that they should assume altogether and relieve the Province to the 
 
THE HON. A. M. ROSS. M^ 
 
 extent of $62,500,000. In 1873 it was found that the debt of the 
 late Province of Canada amounted lo $73,000,000, and upon appli- 
 cation by some of t je provinces an A^ct was passed relieving the 
 provinces from that excess of debt, the Dominion assuming the 
 whole. By the construction of that Act I claimed last year that the 
 wording o+' it was really to relieve the provinces from the date of 
 1867 instead of from 187b, but in the ace unts they have charged us 
 with interest from 1867 to 1873. and I claimed that we ouofht 
 to have credit to the extent of about $5,000,000, Ontario's share 
 being over $2,500,000. Now tnat contention of mine was scouted * 
 at the time by hon. gentlemen opposite (hear, hear) ; they dis- 
 puted the position I took. The}'' stated " that it was a construc- 
 tion wholly unwarranted, and one not to be listened to for a • 
 moment." They said " that we had no possible right to the am- 
 ount," and "that it would be a very gross breach of faith on the 
 part of the Dominion if they were to grant it." Well, sir, I am 
 glad to be able to inform the House that the interpretation which 
 I placed upon that Act has been accepted by the Dominion Gov- 
 ernment (applause), and that the proportion of interest which had 
 been charged against us in those accounts has been credited by 
 the Dominion to Ontario in the sum of $2,882,289. 
 
 Mr. Meredith. — I suppose that is a case of Quebec dom- 
 ination ? 
 
 Hon. Mr. Fraser. — No. It is Ontario justification. 
 
 Hon. Mr. Ross. — Now, hon. gentlemen I suppose will contend 
 that the interpretation which I put upon the Act was really not 
 that accepted bj'- the Dominion, but I think that if I read the Act 
 passed in the Dominion House last session it will be clearly seen 
 that it was so, in fact, the whole Act was based upon that con- 
 tention. There would be no reason for it otherwise. It recites the 
 Act of 1873, and is virtually an interpretation of that Act. The 
 Act reads : " Whereas the subsidies payable under the British 
 " North America Act, 1867, to the several provinces thereby united 
 " into one Dominion respectively, were re-adjusted and increased 
 " by the operation of the Act of the Parliament of Canada, 36 Vic, 
 
12 FINANCIAL STATEMENT OF 
 
 " chap. 30, but the said increase was allowed nnl^ on and from the 
 " first day of July, 1873, etc." Then it goes on to provide that 
 " in the accounts between the several provinces and the Dominion, 
 " the amounts by which the yearly subsidy to each was increased 
 " hy the Act 36 Vic, chap. 30, shall be calculated and allowed to 
 " Ontario and Quebec (jointly, as having formed the late Province 
 '* of Canada) as if the said Act had directed that such increase 
 " should b9 allowed from the day of the coming into force of ' The 
 " British North America Act, 1867.' " Now, that was my conten- 
 tion, that the Act itself stated that the amount named in the 
 British North America Act should be read as if the increased 
 amount was a part of the Act. It was upon that interpretation 
 and construction that we were to be relieved from that debt. I 
 say that the Dominion have accepted that interpretation. If this 
 was merely an act of grace, giving us an additional subsidy, there 
 would be no justification for giving it to Ontario and Quebec 
 jointly upon the basis of the division of debts as fixed by the 
 award, and not upon population. The equivalent that was given to 
 the three smaller provinces Wcis given upon the basis of popula- 
 tion. I say also there is no defence for the division that the Domin- 
 ion Government has made between Ontario and Quebec except'on 
 account of its being in connection with the debt due by the late 
 province, and because it was deemed to be a carrying out of the 
 intention of the Act of 1873. . i .- 1 ,n/ . v.^i«.^JI jt'* -^a aj^H^ ;: 
 Now, it was contended also by hon. gentlemen op^josite that it 
 was not in the interests of the Province of Ontario to ask this, 
 because they contended that Ontario has to contribute from two- 
 thirds to three-fourths of the revenue of the Dominion, and there- 
 fore by making application for this increase, Ontario would be 
 contributing to the Dominion more, perhaps, than she wou'd be 
 receiving if we only got our receipts in proportion to po ulation. 
 That was the contention of hon. gentlemen opposite. But the 
 Dominion have imposed increased taxation within the last three 
 years,and have been able to claim that theyhavea surplus of receipts 
 of upwards of $17,000,000. The possession of that surplus revenue 
 
THE HON. A. M. ROSS. 13 
 
 has no doubt enabled und has prompted the Government to find 
 new outlets for that increased revenue that they are receiving, and 
 we have found applications made from various quarters as to how 
 this surplus should be a:sposed of. It was >vell known at hat 
 time that Quebec was making urgenf demands that they sh uld 
 be allowed some consideration in iv^<i^i.u ou oi^i. ^c^.....^:., on 
 account of the amount they had expended upon certain roads, or 
 should be relie^'^ed in some other manner. It was perfectly well 
 known that if (Quebec took a firm stand in a position of that ^"ind, 
 that they would be successful. I stated last year that I had no 
 doubt that Quebec would be successful, but that if an increase of 
 subsidy were granted to Quebec, Ontario must take the ground 
 that she was entitled to an equivalent. The Dominion Govern- 
 ment did relieve Quebec in two separate ways. In this case, out 
 of a total of $7,172,000 given under this Act of 1884, Ontario is 
 to get $2,882,289, and yet last year hon. gentlemen opposite held 
 that we should not contend for this. But have they uttered one 
 word of condemnation upon that other scheme that was carried 
 through the Dominion Parliament last session, whereby Quebec 
 got a return of $2,400,000 for aid granted to local railways, and 
 Ontario was refused a single dollar for the same thing ? Have 
 they found fault with that ? Was it not much better, Mr. Speaker 
 that this Province should take the position that if Quebec should. 
 get some more relief from the financial embarrassment under 
 which she was labouring, it should be upon some basis whereby 
 Ontario should receive an equivalent ? Hon. gentlemen opposite, 
 t suppose, if they had occupied our position on th'is side of the 
 House, would have refused this $2,800,030 and allowed Quebec to 
 take her proportion. But I say, Mr. Speaker, that it is much 
 better that we should press our claims when we see other provinces 
 pressing theirs, and when we see that they are getting some ad- 
 vantages, endeavour to get an equivalent ourselves. I will, how- 
 ever, refer to the railway question later on, 
 
 I shall now give the House a statement of the expenditure for 
 the past year. It has been as follows : 
 
14 FINANCIAL STATEMENT OF 
 
 EXPENDITURL, 1884. 5>f ;r(1 
 
 .1 
 
 Civil Government $179,825 23 
 
 Legifllation 141,440 28 
 
 Administration of Justice 331,026 69 
 
 Education 531,651 00 "^ ^'"^J 
 
 Public Institutions —Maintenance 600,216 15 
 
 Immigration 43,369 92 
 
 Agriculture, Arts, etc 195,362 64 ■ -' 
 
 Hospitals and Charities 94,218 83 ( j, , ,. , - 
 
 Repairs and Maintenance, P.B 70,149 91 ^ 
 
 Public Buildings 235,517 24 * ' ' •' 
 
 Public Works 27,717 40 ,,, . 
 
 Colonization Roads 185,772 55 
 
 Charges on Crown Lands 103,006 53 '•'' •'' ' 
 
 Miscellaneous 84,754 05 *.:4{' , i; 
 
 Refunds 46,006 70 , , 
 
 Or a total expenditure under the Supply Bill of. ..$2,870,035 12 k ' . i .rj 
 
 Then there are certain classes of expenditure that are outside 
 of the Supply Bill, for which we do not take an estimate. I will 
 give them in detail. 
 
 ■ ■.••-■' ■:: iM. :»„r;i'; -i.'Cf •'^ifl'n'' ;'' 
 
 Drainage Debentures $ 71,998 04 
 
 Aid to Railways 253,783 41 ' *'''^" 
 
 Annuities 6,700 00 
 
 Municipal Loan Fund 150 00 
 
 Pensions to Widows 3,284 84 ^ ' '' ' 
 
 Drainage of Swamp Lands 1,600 00 
 
 Land Improvement Fund— Si>ecial 338 26 
 
 '.-w .,,,••■. ■ -^.-r.^r - $337,854 55 
 
 Maki xg the total expenditure under the Supply Bill and » . . v 
 
 otherwise $3,207,889 67 
 
 Mr. Meredith. — At what rate are the Drainagfe Debentures 
 issued? 
 
 Hon. Mr. Ross. — These are all 5 per cent. Debentures. ' ' 
 
 Now, there are one or two items in this statement to which I 
 may perhaps briefly refer. It will be noticed that our expenditure 
 under Civil Government has very closely, I may say almost exactly, 
 approximated what our estimate of expenditure was. We esti- 
 mated $179,797, and we have expended $179,825. In Legislation 
 it will be seen that there is a large over-expenditure ; it is more 
 particularly under the head of Sessional Clerks, Printing and 
 
THE HON. A. M. BOS?. 15 
 
 Stationeiy, Now these expenditures are yearly increasing. As 
 I stated last year, it is an expenditure which is to a certain extent 
 more under the control of the House than of the Government. As I 
 pointed out before, when lengthy returns are applied for, no matter 
 from which side of the House, the applications cannot be acceded 
 to without the employment of considerable additional assistance in 
 preparing and expense in printing them. We also find that there 
 has been an increase last year in the cost of printing our ordinary 
 departmental reports and other reports that are not purely depart- 
 mental but which are for the information of the country. In 1884 
 we found that we had eight volumes of ses.°ional papers. The largest 
 number we have ever had before was six. Then I find that the 
 cost of printing and distributing the reports alone, — annual reports 
 and reports under the head of Agriculture, etc., amounted last year 
 to $34,552. Well, now, all these reports are valuable. They con- 
 tain information which is useful to the public. It would be 
 impossible to withhold this information from the public, but at 
 the same time it must be recognized that we cannot do this with- 
 out involving considerable cost. In all the different branches 
 under my own department, I have directed the attention of the 
 officers to the necessity for the condensation of their reports, 
 and in some cases that a lesser number should be distri- 
 buted, but the House will itself have to a very large extent the 
 control of the distribution, and I would invite the attention, 
 co-operation and assistance of the Printing Committee of the 
 House to this question, with a view of seeing whether this item 
 can be reduced consistent with what is due to the country in the 
 way of imparting useful information. I would not say that it is 
 desirable that this information should be withheld from the 
 country, even if the cost be large. Last year, after the Govern- 
 ment had made provision for the distribution of the Agricul- 
 tural College report, the value of which has been recognized time 
 and again, the House itself took the matter in hand and 
 asked for a further edition, as the public were looking eagerly 
 for them, and that has been one reason why the expenditure 
 
16 FINANCIAL STATEMENT OF 
 
 under fche head of Legislation has exceeded the estimate by the 
 amount it has. 
 
 Then under the head of Administration of Justice, it will be 
 seen that t\ ere has been something of an over-expenditure. That is 
 mainly due to the amounts returned to counties. As explained be- 
 fore, the Criminal Justice expenditure is largely under the control of 
 the municipalities, and the Government reimburse the municipali- 
 ties a certain portion of that expenditure. Although in the previous 
 year this had only amounted to .$108,000, we took an estimate for 
 $123,000, anticipating, as we had always found to be the case, that 
 when times are hard crime is on the increase, yet we found in spite 
 of our caculations that our estimate was too low, and instead of 
 paying this $123,000, we have actually returned to the munici- 
 palities $132,081, or an over-expenditure of $8,281 that we have 
 given to the municipalities in connection with Administration of 
 Justice over and above what we had anticipated. 
 
 Then there has been an over-expenditure in the item of 
 Immigration, and I may say, without going into details, which I 
 suppose the Minister in charge will do hereafter, that a large part 
 of that over-expenditure is for the carriage of immigrants in the 
 previous year. The. accounts had not been sent in by the railway 
 authorities and therefore had not been paid that year, consequently 
 our expenditures in 1884 were increased by this amount, which 
 properly belonged to 1883. 
 
 Under Agriculture and Arts there is an over-expenditure, and 
 I may state that the remark that I have already applied to Legis- 
 lation applies here. About $8,000 has been for extra reports not 
 charged to Legislation but charged under the head of Agriculture 
 and Arts. I find that these reports amount to about $7,914. 
 There was the butter-making report,$l,630 ; college report, $3,034 ; 
 reports of the fruit-growers, entomological society, dairymen's 
 association, forestry, $3,219, or a total of $7,914, which has been 
 expended in regard to these agricultural reports, causing an over- 
 expenditure of between $4,000 and $5,000. 
 
 Mr. Meredith. — You have not touched the over-expenditure* 
 of $14,000 for the Agricultural Farm ? 
 
TliE HON. A. M. ROSS. 
 
 fr 
 
 Hon. Mr. Ross. — T' ^e is an over-expenditure in connection 
 with the experimental tarm. Last yoar we asked the House for 
 a grant of $25,000 to purchase thorough-bred stock. It was 
 impossible to tell exactly in an estimate of that kind what the 
 cost would turn out to be. A great deal had to be left to the 
 iud^ment of Professor Brown of the Agricultural College, under 
 whose charge these purchases were made, and the expenditure m 
 connection with the transportation of the stock and the retaining 
 of them in quarantine for three months before they could be 
 brought to the faim, under the regulations of the Dominion 
 Government, made our expenditure, as will be seen by the public 
 accounts, $27,000 instead of $25,000. Then, as I said, there is an 
 expenditure of some $4,000 or $5,000 for reports, and the farm 
 has cost somewhat more than we anticipated it would. 
 
 Then, under the head of Miscellaneous, it will be seen that 
 there is a considerable over- expenditure. That is largely due to 
 the expenditure imposed upon us in connection with the boundary 
 dispute, an expenditure having been incurred of $29,327, when 
 we only estimated an expenditure of some $10,000. 
 
 Mr. Meredith. — The hon. gentleman has passed over a large 
 increase under Repairs and Maintenance of Departmental 
 Buildings. r.'.f-M-^;> s;mrKvviM.j =m^:. ;^r-v: .-,: ,...,-,. -....^.:, ...■ ............. 
 
 ti.: ' Hon. Mr. Ross. — Yes. It was a new account, a sort of experi- 
 ment in character, whereby we placed Repairs, etc., under a 
 separate account instead of having them charged under the depart- 
 • mental accounts, as formerly. It will be noticed that the over- 
 ■ expenditure has been largely in connection with the Parliament 
 Buildings here and Government House. This subject has been 
 referred to before, and it is hardly any use to mention it again 
 now. A building such as this requires a very large expenditure 
 for repairs to maintain it. Hon. gentlemen have the opportunity 
 of seeing that for themselves, and I have no doubt will say 
 that the repairs are not of that extravagant character which could 
 be condemned. ' -ijiia w.r 
 
 There is also an over-expenditure in connection with the 
 northerly and north-westerly parts of the province. That ex- 
 
J|$ FINANCIAL STATEMENT OF 
 
 penditure has been forced upon the Province partly by the 
 unwarranted invasion of what was known as the disputed terri- 
 tory, now disputed no longer. (Cheers.) An invasion instigated 
 from what (quarter it is not for me to say, but which threw upon 
 the Government a largely increased expenditure in maintaining 
 the authority of the Government in those parts. This over- 
 expenditure has amounted to $6,703. It is not my place, Mr. 
 Speaker, nor do I desire at the present time, in making this financial 
 statement, to reflect upon the causes that led to this over-expendi- 
 ture. That question can be discussed another time, and I do not 
 wish to say anything that may be looked upon as of a hostile 
 spirit. A part of that expenditure was also incurred on account 
 of the turbulence that existed in consequence of the construction 
 of the Canadian Pacific Railway in those parts, which caused an 
 increase in expenditure which could neither be avoided nor 
 foreseen. 
 
 .^v , I might refer very briefly to a large item of our expenditure, 
 viz. : the maintenance of public institutions. Last year I gave the 
 House tables shewing the comparative expenditure from year to 
 year, and the deduc! m which I drew from those tables was that 
 I believed that in regard to our Reformatories, the Central Prison, 
 and the Institutions for the Deaf and Dumb and Blind, the Province 
 had arrived at that position when the demands of that class of 
 unfortunates had been overtaken. That although variations might 
 take place from time to time, sometimes a little over and sometimes 
 a little under the expenditure as at present, still we would not 
 find in regard to these institutions that ccmtinuous and progressive 
 increase that had existed in former yeai-s. That deduction was 
 disputed by hon. gentlemen opposite. I am happy to say that from 
 the returns given me by the Inspector of Prisons, which will appear 
 in his report, another year's experience has added force to my 
 contentions. I find in regard to these institutions (I am not re- 
 ferring now to our Insane and Idiot Asylums) that the numbers 
 that were confined and taken charge of in 1884 were less than in 
 1883, and these again, as I pointed out last year, were less than 
 
THE HON. A. M. ROSS. 19 
 
 they had been in 1881 and 1882, or not increasing at any rate, so 
 I think it may be assumed that in the cost of the maintenance of 
 these unfortunate persons and criminals, we have arrived at the 
 maximum expenditure, and any increases we may have in future 
 years will be mainly due to the minor fluctuations that may take 
 place from year to year, or to the increase of po})ulation. 
 
 I am sorry to say that in regard to our Lunatic and Idiot 
 Asylums, these deductions do not hold good, — that we are still 
 year by year finding a steady and progressive increase in the 
 numbers admitted and in the cost of maintaining them, and this 
 year, as will be seen by the estiuiates, the Government will find 
 themselves obliged to ask an amount from the House for the pur- 
 pose of providing additional accommodation for these classes. 
 In connection with this matter I may refer very briefly to the fact 
 that the Province of Ontario deals in the most liberal manner with 
 these unfortunates. There is no other province or country that 
 deals more liberally with them than we do (uear, hear). [ have 
 requested the Inspector of Prisons to make enquiries and give me 
 the result as to what the practice is in regard to other institutions 
 of a similar character in the United States and also in our own 
 provinces, and from the returns he has given me, particulars of 
 which will be given in his report, where hon. gentlemen will see 
 them in detail, I find that in the United States there are seven 
 States that assume the whole cost of the maintenance of 
 their lunatics ; I find that there are 18 in which the whole cost is 
 thrown upon the municipalities from whence they come ; and in 
 13 they divide the cost, a portion being paid by the State and a 
 portion by the municipalities sending them. We in Ontario, be- 
 cause our revenue enabled us to do so, have maintained these 
 lunatics at the whole cost of the province, and I think we have 
 maintained them in a manner not only creditable to the people of 
 the Province, but which has elicited the encomiums of those who 
 are capable of judging, who have visited the institutions. It has 
 been found that in no other Province or State are institutions 
 conducted with more ability or eflBciency than those in the Province 
 B 
 
20 FINANCIAL STATEMENT OF 
 
 of Ontario. I last year mentioned in regard to the cost that our 
 institutions were maintained at as low an average cost as any 
 others. I think I may also say, speaking of the other Provinces 
 of the Dominion, that Quebec throws the cost of the maintenance 
 of lunatics upon the municipalities from whence they come. In 
 Nova Scotia the Government only contribute $12,000 towards the 
 support of the asylum, which is placed under the charge of a con*- 
 raission. They throw the whole of the rest of the expense, both 
 of the building and the maintenance, upon the municipalities from 
 whence the inmates come. 
 
 Now, in regard to over-expenditures. There was a good 
 deal of over-expenditure last }ear, and I suppose it will 
 be one of the matters to which hon. gentlemen opposite will 
 take exception. It is always likely that over-expenditure 
 will take place from time to time, and there is the more 
 likelihood that such will be the case in times of depression 
 than at any other time. Hon. gentlemen will see that at Ottawa, 
 although they have an overflowing treasury, claiming a surplus 
 that they do not know what to do with, and therefore have no 
 inducement to under-estimate their expenditure, yet we find that 
 last year there have been very large and heavy over-expenditures 
 
 on the part of the Dominion, _ ,, 
 
 „,_Mr. White. — That is no excuse for vou. 
 
 Hon. Mr. Koss. — I do not claim that it is. I am only pointing 
 out that in all expenditures under Government management, there 
 will be over-expenditures from time to time. It is impossible for 
 a Government to foresee at the commencement of a year that 
 certain exigencies will arise which may call for an increase, and 
 these increases have to be met or the public interests will be 
 jeopardised. The Government have to take the responsibility 
 when these over-expenditures arise, of meeting them, trusting to 
 the House to see that they have been justifiable. 
 
 I will now place before the Hjuse a statement of the financial 
 position of the Province as on the 31st December, 1884, as regai Is 
 assets and liabilities : 
 
THE HON. A. M. ROSS. SI 
 
 • 
 
 '' AhhKTB OF THK PrOVINOB. '! 
 
 1, Direct Jnvtttmentu ; — r , ,, ' , 
 
 Dominion 6 per cent, lionda ?500,000 00 
 
 Market value over par value 50,000 00 > 
 
 S550,000 00 
 
 Drainage 5 per (sent. Debentures, in- * 
 
 vested 3l8t December, 1884 $241,602 48 
 
 Tile Drainage 5 per cent. Debentures, 
 ' investedaist December, 1884... 26,239 61 ' ' ' ' 
 
 Overdue Interest on above 1,649 90 i • ; : , > 
 
 Drainage "Works — Municipal Assess- . . 
 
 menta 278,779 77 
 
 ,i]\ ■:-'-', .'> .. .. ; i'lr,-. r .'■ 548,27176 
 
 $1,098,271 76 
 
 ,.,■■0;.,. ,'t ■ ; :> r,'' ■■ ' ■ ■'. I,' '.,• : • • '■;.•;;! '■i.V'i''','; 
 
 f . Capital Held and Debts Due by the Dominion to Ontario, Bearing Interest .— . 
 
 U. C. Grammar School Fund, (2 Vict., Cap. 10).. . $312,769 04 ,, . , 
 
 U. C. Building Fund, (18 Sect., Act 1854) 1,472,39141 
 
 * Land Improvement Fund, (See Award) 124,685 18 
 
 Common School Fund, (Consol. Stats., Cap. 26)— , . 
 
 proceeds realized to 1st July, 1867, $1,520,959.24 
 " ' —after deducting Land Improvement Fund 
 
 I Portion belonging to Ontario 891,201 74 
 
 Capital declared owing to the late Province of Ca- 
 nada by Dominion Act, (47 Vict., Cap. 4)— 
 t.yr.r $5,397,603.13, bearing Interest at 5 per cent. ' 
 Ontario's proportion on basis of Award as ad- 
 
 ' ' vised by Finance Department 2,848,289 52 
 
 Ontario's Share of Library, (see Award) 106,54.^ 00 
 
 6,754,877 89 
 
 Ty t>tv^:::-, .-n'^ftiT ;il.;^. ';;,.;;:.: ■ri^i-' 'i''' ; 'v ' 
 S. Other Debts Due to the Province:— 
 
 Balance re Municipal Loan Fund Debts $86,976 32 
 
 " reMortgages, Mechanics' Institute, Toronto, 
 ,, and Land at Orillia Asylum 7,905 08 . .; jj.; 
 
 " rcMimicoLots 6,527 58 
 
 K>l,m 98 
 
 .^. Bank Balances .• — 
 
 Current Account. $196,507 22 -s.,>M i: 
 
 Special Deposits 71,579 75 
 
 268,08f a>f 
 
 Making a total of $7,222,645 60 
 
 Now, as regards the first item in the forog^ing statement, — 
 Dominion bonds — the premiuii that is taken into account ought 
 to be the real market value of the security. The $500,000 of Do- 
 minion securities that we hold are liot quoted in any stock list 
 
22 FINANCIAL STATEMENT OF 
 
 that I have seen. The Province of Ontario holds, I suppose, the 
 whole of that issue which is now outstanding. 
 
 An Hon. Member. — How long have they to run ? 
 
 Hon. Mr. Ross. — They do not mature till 1893, but I say that 
 on looking at the stock lists I do not find that particular issue 
 quoted in any of them, but I find that in the assets and liabilities 
 of the Dominion there is a 6 per cent, issue amounting to some 
 $500,000 still outstanding, and I presume that that is the one we 
 hold, though the dates are not given, and I suppose that is the 
 reason it is not quoted in the stock lists, because there are none 
 on the market ; so in arriving at the market value I have taken 
 the market value of other securities bearing the same rate of in- 
 terest and falling due about the same time. From quotations from 
 the same official authority before quoted, viz., the London Econo- 
 mist, I find on the 3rd January there are quoted British Columbia 
 securities bearing 6 per cent, falling due in 1894, just a year after 
 ours, 110 to 112; I find New Brunswick 6 per cent, securities are 
 quoted at 110. They are falling due two years before ours, and 
 yet they are worth more than ours are valued at. Then I find 
 Victoria debentures falling due in 1891, two years earlier than 
 ours, are quoted at 109 to 112. And taking all these into con- 
 sideration, not to exaggerate what would be the value of ours, I 
 have placed the premium at the minimum of 10 per cent, upon 
 their face value. Then we come to — 
 
 LlABIiilTIES OF THK PROVINCE AT PRESENT PaTABLK. 
 
 1. Balance due to Municipalities re Surplus Distribution $2,000 46 
 
 2. Balance due to Municipalities, re Land Improvement Fund (balance 
 
 of $124,685.18, see Award) 3,608 66 
 
 3. Quebec's share of Common School Fund made up as follows : — ' ; .•■<.i,V.'' 
 
 Collections on account of Lands sold between 14th 
 
 June, 1853, and 6th March, 1861 $838,557 62 
 
 Less 6 per cent« cost of Management $50,313 46 
 
 Less one-quarter for Land Improvement 
 
 Fund 209,639 38 
 
 259,952 83 
 
 $678,604 69 
 
THE HON. A. M. ROSS. " SS 
 
 p. Collections on sales made since 6th March, .s iKv/v. jtih':., ■ ;.j 
 
 1861 8302,657 68 ■^3^ ■ ' ; ; : 
 
 Lew 6 per cent., cost of Management ... . 18,15946 „^. .i.. !l ' ' ' ' "^'' 
 
 .•, )Vn- ..,i> ■-*,:;» 1)1 284,498 22 ,, ;,-,;, !'_^ 
 
 .-j-i! 'V'^liiV').* 0/ J-^'-;-.^- n.K. r^^ ; - ,^u 'ji.'r, . $863,102 91 -^.i- r^;>-- 
 
 Quebec's proportion according to population of 1881 357,370 21 
 
 .<■ •'■; ,Ji. !,■ 
 
 Total $362,979 21 
 
 Leaving a surplus of assets after deducting liabilities presently payable. $6,859,666 39 
 
 (Loud applause and Opposition dissent.) <? : i. i A i< 
 / Now, hon. gentlemen opposite, I suppose, from the manner in 
 which they have received this statement, will be inclined to dis- 
 pute that we are entitled to claim this amount of $2,848,289 as 
 part of our assets. I suppose that that is the ground that they 
 will take, but I think when they come to read the statute under 
 which that amount is given to Ontario, and to see the manner in 
 which it is dealt with by the Finance Department at Ottawa, they 
 will themselves come to the conclusion that it is clearly an asset 
 of the Province which we have a right to take into account. I 
 referred before to the Act of 1884, and declared that it was really 
 an interpretation of the Act of 1873. I said that there was no 
 other ground upon which the division which has been made could 
 have been defended than the one that it is a carrying out of the 
 Act of 1 873. There is no ground upon which it could be given to 
 Ontdrio and Quebec jointly unless in connection with the debt 
 due by the late Province of Canada, because this interest was 
 charged to the late Province of Canada in the Dominion accounts, 
 and this is a return of that which had been charged to us and 
 which had been deducted from the subsidies payable to the dif* : ;- 
 ent provinces. Now let us read what the Act says is to be done : 
 It says " the total amount of the half-yearly payments which 
 would have been made on account of such increase from the 1st 
 July, 1867, up to the 1st January, 1873, with interest on each at 
 5 per cent, per annum from the day on which it would have been 
 so paid to the 1st day of July, 18S4, shall be deemed capital owing 
 to the said provinces, respectively." (Hear, hear.) Now if this 
 
24 FINANCIAL STATEMENT OF 
 
 is capital owing to the provinces, it is a debt due to the provinces 
 and it is clearly stated that it is capital owing to the provinces 
 which is to be taken into account in the settlement of the accounts 
 with the Dominion. Is it therefore not an asset to be taken into 
 
 account ? 
 
 Mr. Meredith. — I would ask the hon. gentleman if it is not 
 another invasion of Provincial rights ? 
 
 Ho , Mr. Ross. — No, it is an acknowledgment of Provincial 
 rights. The Act distinctly says that it is capital owing to the 
 provinces, and they have made the division, as I stated before, 
 upon the basis of the award, while they have given an equivalent 
 to Manitoba, British Columbia and Prince Edward Island upon 
 the basis of population, clearly recognizing that it is merely carry- 
 ing out what was the intention of the Act of 1873, and a matter 
 to be settled and taken into account between the Province and 
 the Dominion in the settlement of their accounts. Then how does 
 the Finance Department at Ottawa treat it ? If it is not capital 
 owing to us, if we are only entitled to the interest as part of our 
 annual subsidy, surely we have no right to have the principal 
 credited to us in the accounts of the Dominion, yet we find in the 
 Public Accounts of 1884, that it is entered to our credit. The 
 Province is directly credited with it, and its liability on account of 
 the debt of the old province is reduced by that amount. Are we, 
 therefore, not entitled to claim it as an asset now ? In none of 
 the former Acts providing for increases to Nova Scotia or New 
 Brunswick are the words used "capital owing." In all these 
 other cases they treat it as and call it an increase of subsidy, but 
 in this case it is treated as " capital owing " and is credited to the 
 respective provinces. I have no knowledge of what was in the 
 minds of those who framed the Act, but I think I can see why it 
 was placed in that way. Some of the provinces are indebted to 
 the Dominion, and by making this capital owing and applying the 
 amounts placed in the Act to the credit of their te'" ective accounts 
 the Dominion collects the balances owing. -^ 
 
 Mr. Meredith. — Why don't you get a cheque for the amount 
 granted Ontario ? 
 
THE HON. A. M. ROSS. 25 
 
 Hon. Mr. Ross. — We don't want it ; it is invested there, 
 drawing five per cent interest. We cannot make a better invest- 
 ment. '' *' 
 
 I say, therefore, Mr. Speaker, that by the action of the 
 Finance Department at Ottawa themselves, they have treated it 
 as a payment to the Provinces to which they are entitled to 
 credit in the settlement of accounts ; and, I say again, that if any 
 of the Provinces who had overdrawn their accounts with the 
 Dominion are entitled to have these amounts placed to their 
 credit as a set-ofF against their over-drafts, we, who have not 
 overdrawn, are as clearly entitled to take credit for this 
 $2,800,000 as an asset of this Province. ''^'*'' "^ 
 
 Then, also, in the statement of assets and liabilities given by 
 the Dominion in the Public Accounts of 1884, hon. gentlemen 
 will find in the statement as given there, which includes the 
 balances due by the Provin^'s to the Dominion, which they take 
 into account as an asset in , 883 and 1884, that the amounts of 
 these debts are decreased by the amounts which these Provinces are 
 credited with. Are we, then, not clearly entitled to treat it as 
 an increase of our assets ? Most assuredly we are ; there can be 
 no question about that. 
 
 It is but right, however, to say to the House that there are, in 
 addition to the liabilities I have named, other liabilities of the 
 Province. I do not dispute that, but I have made a distinction 
 in deducting the liabilities from the assets. I have deducted 
 those liabilities that are at present payable. All the liabilities 
 which I have named here are liabilities which we may be called 
 upon to-morrow to pay. There are other liabilities which were 
 never intended to be considered as present liabilities. In regard 
 to the old railway certificates, the Government took ihe ground 
 that they could not, out of the present revenue, undertake to pay 
 the amount of the two or three or four thousand dollars a mile 
 granted to these railways at the time, but they said, " We will 
 give you, in the future, certain amounts, yearly -or half-yearly, in 
 aid of the construction of your railways," and the certificates 
 
20 FINANCIAL STATEMENT OF 
 
 were issued for the convenience of these railways^ for the pur- 
 pose of enabling them to raise money upon them if they so 
 desired, but they were always intended to represent a future 
 liability, to be paid out of revenue of the year in which they fell 
 due. Now, that position has been disputed by hon. gentlemen 
 opposite ; I suppose it will be disputed yet ; but I think you will 
 find an exact) v similar liability on the part of the Dominion, 
 which, Mr. Courtney, the Deputy Finance Minister, treats exactly 
 in the same way. In looking over the introductory remarks in 
 the Dominion Accounts of 1884, it will be found that Mr. 
 Courtney refers to the increased liability made during the ' ear 
 in connection with railway subsidies. He says, " In addition to 
 the liabilities referred to, the several Provinces forming the 
 Dominion were credited in their debt account with $7,172,297, 
 and liabilities were incurred as subsidies to the various railways 
 under the Act 47, Vic. chap. 8, amounting to $6,176,400, which 
 amount does not include the two sums of $170,000 and $30,000 
 per annum for fifteen years." ; '. , . ,, 
 
 ;^^, Now here, by the way, is another evidence in addition to what 
 I have already adduced, in support of our being entitled to claim 
 this $2,800,000 as an asset, when Mr. Courtney treats the total 
 capital as a liability of the Dominion. If it is a liability there, 
 it is an asset here. The Dominion Government in granting rail- 
 way subsidies, granted, as we did, direct payments to some of 
 them, but, in the case of two of them, they took the course 
 taken by this Legislature in former years, and agreed only 
 to give to one road $170,000 a year, and to another $30,000 a 
 year, but Mr. Courtney does not treat this as a present liability. 
 He expressly fsays that he does not include them. Now, I say 
 that this sho\7s that according to Dominion practice these are 
 not to be treated as a present liability, but a liability of the 
 future. 
 
 Then, we have the liability on account of annuities issued 
 last year. They are not a present liability, either ; they cannot 
 be demanded at the present time, but it is a liability falling due 
 
':). 
 
 THE HON. A. M. llOSS. ' 27 
 
 in the future, and if we were merely a commercial corporation, 
 a banking or loan society, we would be entitled to take these 
 yearly liabilities and capitalize them against ourselves. That 
 would be one mode of doing it, and if we were to take that 
 course and folio a^ that pursued by such institutions as I have 
 named, we could shew a far better record than I have shewn, 
 because if we were on the one side to shew the capitalization of 
 our liabilities, we should be equally entitled to capitalize these 
 yearly sums which are guaranteed to us, and of which we are in 
 receipt as guaranteed revenue. We would be entitled to capitalize 
 the sums received from the Dominion Government as subsidy. 
 Now, what would that amount to ? We would be entitled to 
 claim, as the present value of these subsidies, $23,00r»,000. But 
 we do not do so. In all financial statements, whether govern- 
 ment, municipal, or of financial institutions, the system of book- 
 keeping prevails which is applicable to their several requirements. 
 The same systems cannot be adopted, and the same statements 
 cannot be given. I say, in the case of a commercial or loan com- 
 pany they would also take into account, as part of their capital, 
 the buildings they own, the land they own, the debts due upon 
 the land, etc. Now, we might upon that basis take into account 
 all the unsold real estate belonging to the Province, all the 
 public buildings which have been erected. Formerly the Do- 
 minion Government did count among their assets the value 
 of all their buildings erected, but of late years they have 
 discontinued it. We might also claim the unpaid balances upon 
 crown lands, but we do not do so. But there is one point to 
 which I might refer, as shewing that annual liabilities of that 
 kind are not taken into account by the Dominion Government. 
 Some years ago, at the time the Washington Treaty was nego- 
 tiated, certain timber duties that formerly had been collected by 
 the Province of New Brunswick, were abolished and given up as 
 part of the equivalent that was given by Canada in that settle- 
 ment. The Province of New Brunswick applied to the Dominion 
 
FINANCIAL STATEMENT OF 
 
 Government for the reimbursement of the amount. The Domin- 
 ion Government voted New Brunswick an annual payment of 
 3^150,000 in perpetuity in lieu of these timber duties. Have they 
 ever capitalized that and treated it as a liability ? But I wish 
 to guard myself in this way. I consider these annuities and 
 these railway certificates as liabilities, but I do not give them in 
 the statement I have given now, because I have only given the 
 • liabilities which are at present payable, which we might be called 
 upon to make good to-morrow. If we were to come to a settle- 
 ment with Quebec at once, that Province might demand their 
 proportion of the Common School Fund, and we would be obliged 
 to make it good. But those which are payable out of annual 
 revenue we do not take into account in this statement of 
 liabilities tht^t we may say are presently paya,ble. They are 
 liabilities, however, which are payable in the future. =^'^ '■ ' ' 
 <^ Now it has been the practice for some years in these discus- 
 sions upon the Financial Statement, in fact, the general course of 
 criticism has been upon the other side of the House, to draw com- 
 parisons of the expenditure now and the expenditure under 
 Sandfield Macdonald. I think, Mr. Speaker, that it is about time 
 that these comparisons should cease. I trust that hon. gentlemen 
 on the opposite side of the House have become tired of them. 
 The hon. member for West Toronto stated last year that these 
 comparisons were useless — there was no doubt they were. Do 
 you suppose that you could shew extravagance against the Gov- 
 ernment of the present time by comparing the expenditure of 
 the Province of Ontario now with what it was in 1871 ? It would 
 be futile and useless, and I do not propose to make any such 
 comparison. But hon. gentlemen liave also drawn attention fre- 
 quently to the surplus that was, as it were, bequeathed by the 
 Sandfield Macdonald Government to Mr. Mowat, claiming that 
 while he handed over securities to a large amount that were avail- 
 able at that time, we have reduced that surplus to a large extent, 
 or at least have not accumulated surplus as rapidly as he. We do 
 not mean to say that we have accumulated a surplus of a million 
 
THE HON. A. M, R(JSS. 29 
 
 or a million and a half year by year, as they .say Saiidheld Mac- 
 donald did ; but I think it is nothing but right to look at the 
 bequest made U8 by Sandfield, and see what has been done with 
 it. It has been claimed that Mr. Mowat has not accumu- 
 lated a surplus equal to what he did. Mr. Mowat has never 
 recognized it as being the sole aim of a Government to raise 
 a surplus. His pride and glory has been, not to accumulate 
 a surplus, but rather to expend the money in the interests 
 of the people, as far as possible relieving local burdens, and 
 meeting the legitimate demands of a growing Province. Now 
 in 1872, Sandfield handed over to the succeeding Government 
 in investments and bank balances $3,810,964, and if we 
 add to that what was found to be the collectable balance 
 due by municipalities under the Municipal Loan Fund, viz., 
 $1,273,840, we find there was handed over $5,084,804, less what 
 was then Quebec's proportion of the Common School Fund 
 that had been collected up to that time, $105,800, or a total of 
 investments and debts due to the Province at that time of 
 $4,979,004. In this, I may say, I am not taking into account the 
 Dominion Trust Funds, which I will leave out of the account in 
 this comparison. Now v/hat was done with that $4,900,000 ? The 
 very first act of Mr. Mowat was to distribute to the people, in 
 direct payments to the municipalities, $3,388,068. ■ 
 
 Mr. Meredith. — How much of that did you get back under 
 the Tilley Act ? ' - u '** ' ^ .^^ ;«.l^^. 
 
 Hon. Mr. Ross. — We did not get back any of that. By the 
 Tilley Act we only got relief to the extent of the interest on the 
 debt assumed. We have got that now, but I am not going to 
 take that into account in making this comparison, because that is 
 one of the funds in the hands of the Dominion. I thought the 
 hon. gentleman disputed that we are entitled to this $2,800,000 ; 
 but now he wants to charge us with this sum. But I say that 
 there was handed over to Mr. Mowat in investments, etc., 
 $4,970,004, and his very first act was to distribute $3,388,068. 
 His next was to give in aid to local railways, $3,911,880. In 
 
80 FINANCIAL STATEMENT OF 
 
 these two sums alone he gave back to the people $7,299,948, or 
 $2,320,944 more than he had received altogether from Sandfield 
 Macdonald. (Hear, hear.) Now, I would ask hon. gentlemen if 
 the people were not better satisfied with this disposition of the 
 Sandfield Macdonald surplus than if we had retained it and 
 were able to show them a larger surplus now ? The people have 
 already, on more than one occasion, expressed themselves, and I 
 am satisfied that they will say that it is far better that Mr. 
 Mowat should have relieved local burdens, far better that he 
 should have aided these local railways than have kept these 
 funds ana hoarded them up in the provincial treasury in order to 
 be able to say that we have got a very large surplus at the pre- 
 sent time. 
 
 ,.. I might say this, that there are only three items of our govern- 
 mental expenditure that are absolutely necessary to be under- 
 taken by a Government, viz.. Civil Government, Administration 
 of Justice, and Legislation ; all the rest might be handed over to 
 . the municipalities, and could be provided for by them if the Gov- 
 ernment were disposed to throw the onus upon them. If the 
 receipts of the Province were so restricted, they might refuse grants 
 to Education, Agriculture and Arts, Administration of Justice 
 in counties. Hospitals and Charities, and all these are now branches 
 of governmental expenditure. The Government might either 
 reduce these grants or relieve themselves of them altogether and 
 throw them upon the municipalities, if their whole purpose and 
 aim were to accur ulate a surplus. If such had been the policy 
 of Mr. Mowat, he would have been able, by that means, to have 
 shewn to-day a surplus of twenty or twenty-five millions, and 
 yet the whole argument of hon. gentlemen opposite is directed 
 particularly in that line, as if because our expenditure now is 
 increased, because our actual bank balance is reduced, that there- 
 fore there has been extravagance on the part of Mr. Mowat, 
 whereas we claim it as our greatest glory that we have, so far 
 as our provincial revenue will allow, met all reasonable demands, 
 and still have a nice little nest egg in the provincial treasury. 
 (Applause.) 
 
THE HON. A. M. ROSS. 81 
 
 Now, in regard to these particular branches of expenditure 
 which I say might be considered to be purely local if the Gov- 
 ernment were disposed to throw the burden of them upon the 
 municipalities, Mr. Mowat has paid for education, $6,598,251 ; 
 we have paid for the maintenance of public institutions, in sup- 
 porting the insane and idiots, as well as criminals, $5,759,416 ; in 
 aid to agriculture and arts we have distributed $1,423,315 ; to 
 hospitals and charities, $858,366 ; in aid to counties towards 
 payment of the expenses of local administration of justice, $1,649,- 
 150 ; in colonization roads, which might also be claimed to be a 
 burden which might be thrown upon the localities, $1,393,481, or 
 a total in these branches named of $17,681,979. (Hear, hear.) I 
 have not included public buildings and works, because they are 
 of a mixed character, although there is a large portion of it which 
 might be classed in the same way. In regard to the mainten- 
 ance of criminals and lunatics, we know very well that for many 
 years our gaols were crowded with lunatics who were maintained 
 there at the expense of the counties. We know that in many 
 cases these unfortunates were maintained at the expense of their 
 own families. All these have been relieved now, and I am happy 
 to say that on the 3l8t December we had overtaken all reason- 
 able demands applied for from the gaols, although we must 
 provide increased accommodation required for the coming year. 
 
 Now, perhaps it would be as well to see how these grants to 
 these different branches have been increased since 1871. 1 say 
 that Mr. Mowat, if he had kept in view as the main object of his 
 government the accumulation of a surplus, might have said, " we 
 won't increase the grants to these institutions beyond what they 
 were in 1871." That would have satisfied hon. gentlemen 
 opposite ; that is what they say we should have done. But we 
 have increased the grants and are expending more just because it 
 is necessary that we should do so ; because the people want it ; 
 because it is relieving local burdens to do so. Take education ; 
 in 1871 Sandfield Macdonald gave in grants to education, $351,- 
 306 ; if this payment had been continued at the same rate for 
 
32 FINANCIAL STATEMENT OF 
 
 the thirteen years since that time, the total atnount which would 
 have been paid would have been $4,566,078. Mr. Mowat has 
 actually given in grants to education $6,598,251, or, he has given 
 back to the people in the shape of increased grants to schools 
 $2,031,273 more than if he had continued them on the same scale 
 as in Sandfield's time. I think that is a very fair way of putting 
 it, to simply meet ihe objection of hon. gentlemen opposite, who 
 point to an increased expenditure, and endeavour to draw from 
 that that there has been extravagance on the part of the Govern- 
 ment. Then in regard to agriculture and arts ; Sandfield gave 
 in 1871, $7'»,381. If you take thirteen years at that expenditure 
 it would be equal to $992,1)53. Mr. Mowat has given in aid to 
 agriculture and arts, ^.,423,315, or $430,3d2 more than if he had 
 continued the grants on the same scale as in 1871. Then as to 
 hospitals and charities, Sandfield's expenditure in 1871 was 
 $40,260, which for thirteen years would amount to $523,380, 
 whereas Mr. Mowat has given in grants to hospitals and chari- 
 ties during these thirteen years $858,366, or an increa.se of $334.- 
 986 more than if he had continued on the same scale as Sandfield 
 Macdonald. In Public Institutions maintenance, Sandfield only ex- 
 pended in 1871 $171,423. Now, in relieving the municipalities from 
 the burden of maintaining these unfortunates Mr, Mowat has in these 
 thirteen years actually expended $5,759,416, or $3,430,917 more 
 than if he had kept the expenditure down to Sandfield's figures. 
 (Hear, hear.) Then, in regard to administration of justice, taking 
 the same years, Sandfield Macdonald expended $104,049, (and recol- 
 lect, as I said before, when I am taking administration of justice, I 
 am only taking that part of it which is money directly refunded to 
 the mur" ;ipalities), so that in thirteen years we would have given, 
 had we continued in the same way, $1,362,637 whereas Mr. Mowat 
 has given back to the municipalities $1,649,150, or $296,513 more 
 than if he had followed the same scale as Sandfield. In colon- 
 ization roads Sandfield gave $55,4 1 'J in 1871 ; thirteen years at 
 that rate would give $720,317, whereas the actual amount we 
 have given to the inhabitants of these outlying districts in con- 
 
THE HON. A. M. ROSS. 88 
 
 atructing roads, which are certainly of great benefit to the 
 country, has been $1,893,4«1, or $673,164 more than if we liad 
 continued the expenditure merely on the scale left by Sandfield 
 Macdonald. Now these branches of expenditure, which I say are 
 purely to relieve the municipalities, are not expenditures from 
 which the government derive any benefit. As I said before, if 
 their aim was to accumulate a surplus, they might have thrown 
 the whole of them upon the municipalities, or have continued 
 them merely on the old scale, but instead of following that course, 
 Mr. Mowat has, with a liberality which is approved of by the 
 people, increased the grants and has given back to- the munici- 
 palities in thirteen years $7,197,215 more than if he had con- 
 tinued these payments merely on the scale of 1871. . - - 
 
 Mr. Carneoie — Does the hon. gentleman apply the same rule 
 to receipts ? 
 
 Hon. Mr. Ross — Yes; I have no hesitation in doing so. 
 I took up the question of receipts last year, and if the hon. 
 sentleman will refer to the statement I made then, he will see, I 
 think, that I gave a table of what were the receipts of the 
 Province under JSandfield Macdonald, and every year since, and 
 I showed that we had only been receiving an excess of $60,000 a 
 year more than Sandfield Macdonald. (Cheers.) I challenge the 
 hon. gentleman to say if that is not correct ; he has the statement 
 now in his hands, and he will find there that the amount we 
 have received over and above the revenue which Sandfield Mac- 
 donald received was only about $60,000. And I might also say 
 this, and I am glad the hon. gentleman has given me the oppor- 
 tunity, that we have given back to the people more than that 
 $60,000 in remission of revenue. By the abolition of taxes in 
 . Division and County Courts we have given back to the peo|:de 
 seme 130,000 a year, and in reduction of marriage licenses we 
 . have given back to the people another $30,000, so that we would 
 have had $60,000 of additional revenue had we not reduced it 
 for the people's benefit in the way I have pointed out. The hon. 
 gentleman will find all this information in my last year's financial 
 statement, which contains a table of receipts from 1873 onwards. 
 
34 FINANCIAL STATKM'JNT OF 
 
 Now, I suppose the House will be anxious to know what 
 progress h£us been made in the settlement of the disputed accounts 
 with the Dominion. I am sorry to say that the progress has not 
 been what I hoped for and anticipated. It will be in the know- 
 ledge of hon. gentlemen that it would have been impossible to have 
 secured a meeting of the Provincial Treasurers and the Finance 
 Minister until the meetings of both the Provincial Legislatures 
 and the Dominion House had been brought to a close. The 
 meeting of the Quebec Legislature did not close until June, so that 
 it was impossible to secure a meeting until that time. When that 
 did close, it was found that Sir Leonard Tilley's absence in Eng- 
 land would prevent any meeting for the settlement of these 
 accounts. He did not return until September and immediately 
 I applied to him for the purpose of arranging a conference 
 whereby ^ve might arrive at some conclusion and make some 
 progress towards the settlement. A meeting was arranged for, 
 to take place on the 21st October of last year. The Treasurer 
 of Quebec and myself met Sir Leonard Tilley on that occasion, 
 but as the main items of dispute were matters which involved 
 legal contentions, principally respecting the charges made in regard 
 to Indian annuities, Sir Leonard objected in the absence of Sir 
 John Macdonald to take them up, as they were matters pertaining 
 to Sir John's own department, and we therefore failed to make 
 any progress in regard to the main items at issue on that occasion. 
 Then there was another item we ought to have had settled on that 
 occasion, a claim which we had in connection wih the Land Improve- 
 ment Fund ; the Treasurer of Quebec objected to go into that, 
 because he said that before he discussed it he wanted to have the 
 opinion and advice of his Attorney-General, as it was a legal 
 question and might turn largely upon legal issues. You will see 
 therefore that in two of the most important points which we had 
 met to discuss, we were baulked ; but I may say that some progress 
 was made, and, when we come to look at the result, rather material 
 progress. We arranged at that time that Mr. Courtney should 
 make a recast of the accounts in consequ mce of the credit of 
 
THE HON. A. M. ROSS. ' ^ 
 
 interest which has been given ns under the 1)6minion Act of 1884. 
 It was also arranged that the Indian claims, as these might involve 
 legal points, should be placed in a suspense account, so that any 
 delays that might occur in regard to those need not interfere with 
 a settlement of the other matters. That recast of the accounts, 
 although pressed for very strongly, has not yet been received by 
 us, and the excuse offered, which is perhaps a reasonable one, is 
 that Mr. Courtney has been so engaged in preparations for the 
 meeting of the House, etc., that he has not had the time to give 
 attention to it. But there was one matter which was decided at this 
 meeting which is a matter of importance to the Province. You will 
 recollect that las' vear, in drawing attention to these Indian claims, 
 I objected to the sum that was charged to the accounts of the 
 Dominion with the Provinces, of $303,280, charged to us as at date 
 of 1867, as capitalization of Indian annuities payable under the 
 Robinson Treaty, and that I said that this capitalization was alto- 
 gether erroneous. A return will be submitted of correspondence 
 which took place, from which it will be seen that in June last, 
 I drew attention to what appeared to me a grave error in that 
 calculation. I had previously got a statement from Mr. Courtney 
 of the basis upon which the calculation was made, and I found, as 
 I had anticipated, that they had capitalized these annuities twice 
 over. As I mentioned last year, in the statement of debt that was 
 submitted at the time of confederation in 1867, there was $88,000 
 charged as capitalization of annuities. That was the capitalization 
 of Indian annuities then payable under the Robinson Treaty, viz., 
 $4,400 annually. This $303,280, which they charged again, was 
 the capitalization of the $4 per head claimed as the total annuity 
 payable to the Indians, and thus included this $88,000 again. I 
 pointed this out to Mr. Courtney and Sir Leonard Tilley at 
 our meeting. The matter was discussed, and it vas admitted 
 that an error had been made in that amount, and that they had 
 charged us more than they were entitled to by $88,000, and charged 
 us this as at date of 1867, so that it makes it now, calculating 
 interest up to the present time, a credit of $208,842. That was one 
 c 
 
36 FINANCIAL STATEMENT OF 
 
 matter settled on that occasion in favour of the united provinces. 
 Now I may say that the Act passed by the Dominion last 
 session, has paved the way for a more speedy settlement of the 
 accounts. The Dominion Government having not only assum.ed 
 the whole of the debt up to 1873, but also relieved the Provinces 
 from the interest formerly charged upon it, we have not the same 
 interest in closely scrutinizing the items composing it. The differ- 
 ences between the Provinces and the Dominion, in regard to the 
 accounts submitted are, I may say, now practically reduced to 
 three main items : first, the Indian claims, then the Land Improve- 
 ment Fund, and then the interest allowed us on the Building 
 Fund. The Indian claims, as I mentioned last year, are made up 
 as follows : in the first place, they charge us $140,000 for arrears 
 of payments to Indians under the Robinson Treaty as at date of 
 1867 ; and then, as I have already mentioned, they charge us 
 capitalization of annuities, .$303,280, as at the same d^te. On 
 getting a statement from the Indian Department as to how these 
 arrears were made up, I found that they had allov/ed to the 
 Indians the increased allowance provided for by the Robinson 
 Treaty of $4 per head, actually from the date the Treaty 
 had gone into operation, lb 50, although for years after not a 
 single dollar had been received as revenue from the territory. 
 The treaty provided that a certain fixed sum of $4,400 should 
 be paid to the Indians annually, with a provision that if in future 
 years the revenue derived from the territory should enable the 
 Province to do so without h ^s, these annuities might be increased 
 to a sum not exceeding $4 per head. Well, it is clear that until 
 the revenue from the territory does enable the Province to do so 
 without loss, the Indians are not entitled to this $4 per head. 
 
 Mr. Meredith. — Did the Provincial authorities assent to this 
 increase? yv^ „t,,, 
 
 Hon. Mr. Ross. — No, never. These arrears are charged as at 
 date of 1867, as arrears at Confederation due to the Indians. I 
 suppose what the hon. gentleman is referring to is a despatch 
 s^nt by the Hon. the Attorney-General in 1874, seven years after 
 
THE HON. A. .M. ROSS. 87 
 
 Confederation had been in operation, and therefore has no con- 
 nection with these arrears. 
 
 Mr. Meredith. — It assented to the increase. '■ 
 
 Hon. Mr. Ross. — Only partially. It did not assent that they 
 should be charged to the Province, and it had no reference to the 
 arrears. I am only dealing now with the item of $140,000 charged 
 as arrears. They charge that as due to the Indians, that is the $4 
 per head from the time the Treaty went into operation, although, 
 as I say, for some years thereafter there was not a dollar of 
 revenue received from the territory. Then I may say that up to 
 Confederation, taking into account the receipts derived from the 
 territory both from saLs of lands, timber dues, and mining 
 licenses, and taking into account also the payments that had been 
 made to the Indians, the disbursements in surveys and con- 
 struction of roads, the whole receipts of the territory fell short 
 of what had been disbursed by over $250,000, so that there was 
 no ground for giving any increase up to that date, because 
 we had never had a revenue sufficient to meet the expenditure. 
 
 Mr. Meredith. — That was in the discretion ol" the old Par- 
 liament of Canada. 
 
 Hon. Mr. Ross. — But the old Parliament never exercised the 
 discretion. The Indians were never paid it r,o this day. This 
 charge against the Province now is a thing of recent discovery. 
 The Indians never claimed it until 1873, and yet as at date of 
 1867 we are charged with $140,000 and interest from that time. 
 I say there is not a shadow of foundation for that charge, and it 
 must be wiped out of the accounts altogether. That sum, with 
 interest, amounts $332,249, which we are entitled to have credit 
 for. Then there is the claim for capitalization, $303,280. I have 
 already said that they acknowledge an error in that of $88,000 ; but 
 the $303,280, which is based upon the increased annuity of $4, is 
 capitalized as at dateof 1867, and interest charged the Provinceupon 
 it since that date ; but if we are liable at all, we were not liable at 
 that date. Up to Confederation the disbursements had exceeded 
 the receipts by $250,000, as I explained before, and it was not 
 
FINANCIAL STATEMENT OF 
 
 till the year 1872 that the receipts from the territory balanced 
 the expenditure that had been incurred, even in our own Province 
 and through our own Crown Lands Department, so that, taking 
 these expenditures by Ontario alone, it could not be until 1872 
 that there was any shadow of a ground for making that claim. 
 But there is this to be taken into consideration, it is a bargain 
 not between the Province of Ontario and the Indians, it is a con- 
 tract between the Crown and the Indians, and the Crown is repre- 
 sented by all the Governments in Canada, either by the Govern- 
 ment of ^he old Province of Upper and Lower Canada, or by the 
 Dominion, or by the Province of Ontario. It is a contract between 
 the Crown and the Indians, and whatever expenditure has been 
 incurred by any one of these Governments necessary for the 
 opening up of the country, or which has been the means of increasing 
 the revenue that has been derived from it by increasing the value 
 of the land, must be taken into account, before it could be said that 
 the Province or the Crown could give the increased payment with- 
 out incurring loss. We must know what that expenditure is before 
 we can say when the Indians would be entitled to the increase. 
 Again, the Indians never claimed it until 1873, and it was never 
 recognized by the Crown until 1875. We claim, therefore, that 
 if we were liable at ail, and if the surplus of vevenue would war- 
 rant it, that liability only commenced when it was recognized by 
 the Crown. We claim further, however ; we claim that we are 
 not liable at all, because at the time of Confederation, as I have 
 already stated, the Dominion capitalized these annuities payable 
 under these treaties in the sum of $88,000 and charged them as 
 part of the debt of the Province, and I claim, therefore, that 
 there was a settlement virtually of the whole liability under the 
 treaty. The Dominion assumed the $88,000 and agreed to i)ay 
 the annuities. The treaty provided for both a possible increase 
 on decrease of the annuities. It provided that the increased rate 
 might be paid, provided the revenues from the territory exceeded 
 the expenditures to such an extent as to warrant the increase. 
 It also provided that if the Indian population decreased to the 
 
THE HON. A. M. ROSS. 39 
 
 extent of two-thirds of what it was at the time it was executed, 
 the annuities to the Indians should be decreased in pr(>portion ; 
 therefore there was a liability which the Dominion Government 
 had assumed to the amount of $88,000 which was liable to either 
 increase or decrease. Suppose the Indian population had become 
 extinguished, would the J)ominion Government have paid us back 
 any of that $88,000 they capitalized then ? Not a bit of it. They '' 
 took that on speculation, as it were, and if there is any increase 
 to be given by the Crown, the Dominion Government are liable for 
 it ; they agreed to pay the liability under the treaty. Then there is 
 another ground for objection ; the treaties provided for a decrease 
 but not for an increase in population , but I find by the return that 
 has been sent to us that they are paying them $4 per head upon 
 a largely increased Indian population. Indians who never came 
 forward to claim compensation under the treaty are coming for- 
 ward now and claiming it, so that we have strong grounds to 
 claim that the capitalization charge of $303,280 is erroneous alto- 
 gether, or, if it is a liability upon us to any amount, it is one of 
 a very much smaller extent than charged. 
 
 I now desire to refer to the Land Improvement Fund. In our 
 contention for the Land Improvement Fund we are not contending 
 for a matter in which the Province as a province has any direct 
 interest ; it would rather be against the Provincial Treasury ; 
 but we are contending in this as the representatives of the muni- 
 cipalities to whom the fund is due. This matter has been dis- 
 cussed before, but as many hon. members were not in the House 
 when these discussions took place, and 1 know from the corres- 
 pondence that I have received from many municipalities that it 
 is a matter that they Are greatly interested in, so that all the 
 information which can be given I am satisfied will be of the 
 greatest interest to the municipalities, I will perhaps refer to it 
 more fully than I otherwise would. The Land Improvement 
 Fund was established by 16 Vic, chap. 39. By that Act one- 
 quarter of the proceeds of sales of Common School lands were set 
 apart for local improvements in the localities where the lands 
 
^ 
 40 ^ FINANCIAL STATEMENT OF 
 
 .sold were situate. By the same Act one-fifth of the sales of 
 Crown Lands were set apart for the same purpose. In 1861, by 
 Order in Council, this fund was put an end to so far as future 
 sales were concerned, but the before-mentioned proportions of 
 collections on sales made between 1853 and 1801 were still to be 
 credited to this fund. Statements submitted by the Dominion 
 at the arbitration between Ontario and Quebec, showed that the 
 one-quarter of the School Lands so collected amounted to $124,- 
 685.18, and the one-fifth of similar collections from Crown Lands 
 to $101,171. By the award the Land Improvement Fund was 
 declared to be an asset of the Province of Ontario, but did not 
 state what the amount of that fund was. Whatever it was it 
 belonged to Ontario. The arbitrators having decided that Quebec 
 was entitled to share in the proceeds of the Common School 
 Lands, it was necessary that they should take into account the 
 claim that Ontario had for Land Improvement Fund in those 
 lands, and the}^ directed that before making the division between 
 Ontario and Quebec the sum of $124,085.18 should be deducted 
 from the Common School Fund and credited to the Land Im- 
 provement Fund, and it was only in this way that any direct 
 reference was made to the $124,085. They made no special 
 reference to the $101,171; they were not called upon to do so. 
 They simply dec.-.red that the Land Improvement Fund was to 
 be an asset of Ontario, without declaring what that fund was or 
 what it consisted of, further than that the $124,086 was to be a 
 portion of it Those who made out the Dominion accounts had 
 evidently been misled into supposing that this $124,085 was the 
 whole amount of the fund, and had overlooked the amount 
 accrued from Crown Lands. But the same principles govern 
 both. They were both provided for by the same Act, and the 
 one is as much a liability of the late Province of Canada as the 
 other, but the fact that the $101,171 is not specifically given in 
 the award may have led the Province of Quebec to dispute this 
 item. At the meeting in October the Treasurer of Quebec refused 
 to assent to that sum being placed to the credit of Ontario until 
 
THE HON. A. M. ROSS. 41l 
 
 he should have an opportunity of discussing the matter with his 
 Attorney-General. The item is therefore still unsettled. But I 
 have not the shadow of a doubt that when it comes to be dis- 
 cussed, Ontario will be able to :naintain its claims on behalf of 
 the municipalities to this $101,171. (Hear, hear.) • a, <s 
 
 These are not the only claims, however, which are in dispute 
 We find that we are confronted with new claims in regard to 
 Indian payments — claims which I am satisfied that the House and 
 the country have never heard of before. We are confronted with 
 a claim of $68,702, claimed to be due the Mississaguas of the 
 Credit under a treaty executed in 1820,— a claim which they 
 themselves never preferred, and was never recognized by the 
 old Province of Upper Canada, under whose jurisdiction and gov- 
 ernment these lands were, and with whom the treaty was made ; 
 a claim that was never recognized b}' the old Province of Canada 
 after the union, a claim that has not been presented by the 
 Dominion to the Province of Ontario for seventeen years since 
 Confederation. In fact, for upwards of sixty years this claim has 
 remained in abeyance, and now we are presented with a claim of 
 $16,838, principal, and $51,834, interest, payable to these Indians. 
 Well, I think it is rather extraordinary that we have not heard 
 of this claim before, and then, I may say that it was only pre- 
 sented to us a few days before the meeting at Ottawa in October 
 last. It seems to be a new discovery. But what will surprise 
 the House more is that but a few days before that meeting took 
 place, on the 21st October, we found that an Order in Council had 
 been passed by the Dominion Government on the 7th of that 
 month, on the recommendation of Sir John Macdonald, directing 
 that this sum should be charged against the Province as a 
 liability and credited to the Indian Fund ; and more, he directed 
 that the Indians should be notified that the amount had been 
 placed to their credit, and they have actually been allowed to 
 draw a portion of the money. I say, sir, that this action is most 
 astonishing, particularly when we consider that an arrangement 
 was entered into between the Dominion and the Province some 
 
42 FINANCIAL STATEMENT OF 
 
 yeara ago that no charge should be made by the Dominion or 
 allowed against the Provinces without the concurrence of the 
 Provincial Treasurers, yet in defiance of that we find this charge 
 made against the Province ; and to complicate matters and 
 enhance the difficulties of a settlement, we find the Indians have 
 been notified that the amount is placed to their credit, and that 
 they have drawn some $6,000. , .j., .-. '<,ut n 
 
 V .. Mr. Meredith. — If it is not a valid claim, it won't hurt you 
 very much. ,; - ., -,ws ^ ^^.f v *i . v.^" > 
 
 Hon. Mr. Ross. — But the hon. gentleman can see that there 
 may be a difficulty after the lapse of sixty years in legally proving 
 whether it is or is not a valid claim. Even if the Provinces were 
 not able clearly to prove that the claim was invalid, the long time 
 which has been allowed to elapse would point to its being a fair 
 subject for compromise. But the House can see how much the 
 difficulty of arriving at a fair settlement has been aggravated by 
 notifying the Indians that the amount is at their credit. I say it 
 was a precipitation altogether unnecessaiy on the part of the 
 Dominion Government. When it had been as long in abeyance 
 as sixty-four years, there was no urgency for a few days until the 
 Provinces had been notified. I say it was a most extraordinary 
 proceeding, and certainly requires some explanation. 
 
 Then we have got another new claim on behalf of the Chip- 
 pewas of Lakes Sirncoe and Huron, $196,000 arrears and $125,000 
 capitalization, for lands which these Indians claim belonged to 
 them, but were ceded by the Ojibbeways under the Robinson 
 Treaty to the Crown, these Indians claiming that the Ojibbeways 
 had no right to cede them because they never belonged to them, 
 and that they, who never were parties to the treaty at all, are to 
 receive the same annuity as given to the Ojibbeways, viz., $4 per 
 head, and that to date back to the year 1850, making $196,000 
 for arrears and the $125,000 for capitalization of future annuities. 
 It strikes me, though I am not a lawyer, and do not pretend to 
 give any legal opinion upon the question, that if the Ojibbeways 
 pretend to cede lands which did not belong to them, and if the 
 
THE HON. A. M. ROSS. <^ 
 
 Crown agreed to pay $4 a head for lands which the tribe claimed 
 the right to cede ; if it turns out they did not own the land, the 
 Crown is not bound to pay. If liable to one we cannot be liable 
 to the other. We cannot pay two tribes of Indians for the same 
 land. We agreed to pay $4 a head to certain Indians for the 
 land they claimed to own, and if it turns out that the lands did 
 not belong to them, the Crown is not liable for the annuity 
 promised, i"»:av, /a .>/>■■■ ^v"lv^.. .■,■!, ■,■-,.,■, ,-r • ?..■. Mi.f-rrui^i^* iritf^ft'rf'iJ.irfiJ 
 
 It appears there have been negotiations going on with these 
 Indians for some years in regard to this claim, principally during 
 1883 and 1884, and we find now this claim charged against the 
 Province. I cannot conceive that it is put forward with any 
 degree of sincerity, but merely trumped up for the purpose of 
 making it appear that Ontario has greater liabilities than is 
 admitted. • --•■'■' ..... : . t. / ......i, *, ^..i i,ia,/: 
 
 But then I may say that we have some claims against the 
 Dominion also, and I believe we are justly entitled to the amount 
 they represent. In the first place, by the unanimous decision of 
 the Supreme Court, two years ago, in the Queen v. Robinson, the 
 Supreme Court declared that all the inland fisheries were under 
 the control of the Provinces and not of the Dominion ; that the 
 Dominion had no control over them and no right to collect 
 licenses ; that the right to fish was vested in the owners of the 
 land. The eflfect of that is that the Dominion Government have 
 been collecting, in Ontario and other Provinces, revenues for fish- 
 ing licenses to which they had no right. We have, therefore, a 
 clear claim to the return of revenues derived from t'lat source^ 
 I have taken the Dominion accounts, and find that there was 
 since Confederation $89,249 collected in Ontario, which, with 
 interest at five per cent., as they have charged us, compounded, 
 would amount now to $129,425. 
 
 Mr. Meredith. — What kind of fisheries are these ? 
 
 Hon. Mr. Ross. — The classification of fisheries in the Do- 
 minion accounts covers a.i inland fisheries. 
 
 Mr. Meredith. — It covers all lake fisheries ? 
 
44 FINANCIAL STATEMENT OF 
 
 Hon. Mr. Ross.— Certainly. '-^ i- - .rj/; i{.y<.i ) 
 
 Then we have another charge to make against the Dominion 
 Government, but of the amount of which unfortunately the 
 House and Province ire ignorant. I refer to the revenues they 
 have been collecting from what was lately known as the Disputed 
 Territory, now, I trust, disputed no longer. The Dominion Gov- 
 ernment have been collecting large revenues from lands, timber 
 limits and minerals, and when we are able to get at the particu- 
 lars, we shall have a large claim against the Dominion for these 
 revenues, unless we find, as perhaps there is too much retison to 
 fear, that they have been sacrificed by the dominion Govern- 
 ment, by grants to political favourites, without valuable considera- 
 tion. .j,l> i.';ipv.ii\' !^J ;»^ismi i:4'U '^•>.»i':-*OJ^ iv ->.'>:.;-^' 
 
 Then we have a third claim against the Dominion Govern- 
 ment, but a claim that cannot, I suppose, be legally enforced as I 
 think the other two can, but a claim that is equitable and a claim 
 which in all justice Ontario is entitled to press. ■* ■r-'ia i'<.'t«u;i v< 
 
 Mr. Meredith. — Consequential damages ? '^I'-ryv^i-m .^."■iti 
 
 'ni Hon. Mr. Eoss. — Not consequential damages, but a claim that 
 ought to be conceded if we are treated the same as other Pro- 
 vinces. I refer to the reimbursement of aid granted to Provincial 
 railways, seized by the Dominion, in the same manner as it was 
 given to the Province of Quebec by the legislation of last session. 
 The House will be aware that the Province of Quebec obtained 
 at that time $2,396,000 as a return of aid given to local roads. 
 It is not for me to say whether the policy pursued by the 
 Dominion under that Act was a wise one or not. It is not for 
 me to refer to the extraordinary pressure reported to have been 
 brought to bear upon the Dominion Government to compel them 
 to give countenance to the claim made by that Province. I do 
 not wish to refer to that here. My duty, as the financial officer 
 of the Province, is to watch the manner in which the other 
 Provinces are dealt with, and see that the Province I represent 
 receives equal justice with them. The past attitude of the 
 Dominion Government in regard to Dominion railways was 
 
THE HON. A. M. ROSS. 45 
 
 this, that they recognized their liability only as regards large 
 inter-national lines, such as the Inter-colonial and the Canada 
 Pacific ; they recognized no liabilily as regards local lines 
 wholly within the Provinces. To the Provinces heretofore had 
 been left the recognition of the demands for local railways. 
 These demands have been liberally met by the Provinces. 
 The charters for these local roads had been obtained from the 
 Provincial Parliaments. These charters gave them privileges and 
 imposed conditions upon which the aid was granted. These roads 
 were under the control of the Provincial Parliaments, the condi- 
 tions could be altered, waived, or new conditions imposed at the 
 will of the people under whose charter they existed. By their 
 charters conditions were imposed as to the carriage of agricultural 
 products, lumber and wood, making indeed a tariff, as it were, 
 for these railways, and under the conditions imposed was the aid 
 only extended. In 1882 these regulations between the roads and 
 the local Parliaments were, by one enactment of the Dominion, 
 swept away and blotted out, and the local control of the roads 
 taken from the people who had built them. ,, ,,^ ...!+ . i/ 
 
 .., Mr. Meredith. — Does the hon. gentleman contend that the 
 effect of the Dominion legislation is to alter their charters? .;• 
 Hon. Mr. Ross. — I do not contend that the Act by which the 
 Dominion Government assumed control of our railways contains 
 any provisions which change the conditions upon which these 
 charters were granted, but when the Dominion Government as- 
 sumed to take control of these roads, they have assumed the power, 
 without the consent of the Provincial legislatures, to change the 
 conditions imposed in those charters as they see fit. (Hear, hear.) 
 These conditions were imposed by this Province in consideration 
 of the aid given to the railways, and now the views and opinions 
 of the people of this Province may be over-ridden by the views 
 of representatives of other Provinces in the Dominion Parlia- 
 ment. This is- where I say the wrong is done. They assumed to 
 control these railways, and take them out of the hands of the 
 Provinces, taking upon themselves the power to change, or to wipe 
 
46 FINANCIAL STATEMENT OF 
 
 out of existence altogether, the conditions upon which the grants 
 were made. Now, T say that by the Act of 1882 the Dominion 
 Government took upon themselves for the first time the burden and 
 responsibility of extending aid to the construction of future local 
 lines, because it was unreasonable to suppose that any Provincial 
 Government would any longer continue to aid roads over which 
 they had no jurisdiction or control, therefore I say that action of 
 the Dominion Government in assuming these provincial roads 
 put the Dominion Government in a new relation to the Provinces. 
 They assumed all responsibility for aid to local roads, and put it 
 out of the power of the Provinces to extend such aid themselves. 
 But they did more. When they assumed those roads in that 
 manner, they rendered themselves, if not legally, morally and 
 equitably, liable to the Provinces and the municipalities for a 
 reimbursement of the aid that had been given, or at least for 
 such a proportion as would represent that general interest of the 
 Dominion which the Act affirmed. Now, what was the ground 
 upon which Quebec got this grant of $iV394,000 last year ? It 
 was upon the ground that the Quebec and Ottawa Railway was 
 a work of national, not merely of local interest. But that is 
 precisely the very same ground upon which they have assumed 
 the jurisdiction of our roads. That assumption was based upon 
 powers given under sec. 92 of the B. N. A. Act, by which the 
 Dominion are entitled to declare any work, though it be within 
 the Province, to be of general interest to the Dominion^ taking 
 that ground, they have assumed the whole control of our roads, 
 and by their Act have declared that all these roads that we have 
 aided are not merely of local importance but are of general 
 advantage to the Dominion. If so, then, the liability of the 
 Dominion follows at once to reimburse to the Provinces the aid 
 given to secure the construction of these Dominion works. That 
 liability has been recognized in the case of the Province of 
 Quebec ; upon the same principle the Province of Ontario is in 
 equity entitled to a portion of the amount it has expended on 
 
^, THE HON. A. M. ROSS. 47 
 
 roads, which have, by the action of the Dominion, been declared 
 to be for the benefit of the Dominion ? 
 
 Mr. Carnegie. — What is the name of the local road in Quebec 
 that the hon. gentleman speaks of? - .. . - 
 
 Hon. Mr. Ross. — I refer to the road from Quebec to Ottawa. 
 It was constructed by the Province as a provincial work, they had 
 expended $11,000,000 in constructing that road. In 1882 the 
 Provincial Government made a proposition to the Dominion 
 Government to buy that road from them. They offered it to the 
 Dominion for the sum of S7 ,000,000, and in introducing the 
 resolution into the Quebec Legislature, authorizing the sale to the 
 Dominion, if they would accept it on these terms, the Attorney- 
 General of the Province used this language. He said, " Let the 
 Federal Government buy our property for $7,000,000. This would 
 represent a loss to the Province of $4,000,000, but Quebec is willing 
 to make a sacrifice which would ensure it an independent line for 
 the traffic of the C P. R., and at the same time give great impulse 
 to the commerical prosperity of the Province," so that in 1882 the 
 people of Quebec were willing to lose $4,0(^0,000 of what they 
 expended because they said they had received value for it as a 
 provincial and local work. The Dominion refused to purchase 
 the road on those terms, but it was sold afterwards, partly I 
 believe to the C. P. R., and partly to another syndicate, for the 
 sum of $7,600,000, or $600,000 more than they had offered it to 
 the Dominion Government for, but there had been some improve- 
 ments made upon it in the meantime. The loss to the Province 
 on that transaction was $4,000,000. They had declared in 1882 
 that they were willing to submit to that loss, but last year, taking 
 advantage of the opportunity which the demands of the C. P. R. 
 upon the Government gave them, they insisted as a price of their 
 support to that measure, that the Dominion Government should 
 return them a portion of that money. The Dominion Government, 
 feeling that the demand was one they could not at that time safely 
 resist, gave Quebec $2,394,000 as a reimbursement in part of its 
 
48 FINANCIAL STATEMENT OF 
 
 grant to that roa. I say that in all justice, in all equity, we, 
 and all the other Provinces who have made similar grants to rail- 
 ways that are declared by the Dominion Government to be for 
 the general advantage of Canada, and which that Government has 
 taken under its contro^are entitled also to a return of a portion of 
 what we have granted for similar works. Even-handed justice 
 must be extended to all the Provinces if our confederation is to 
 continue. We cannot go on in this vay, allowing other Provinces 
 to receive benefits by special pleas of this kind, ^ ;d the Province 
 of Ontario get no equivalent. If our confederation is a partnership, 
 then unless all the partners are accorded efpial justice, that partner- 
 ship cannot continue. I am satisfied that it only requires a united 
 stand to be taken by the peo; }e of this Province and by the other 
 Provinces, to ensure that the Dominion Government will return 
 to us a portion of the amount we have expended, as they have 
 done in the case of Quebec. '^''^^ 1:!.' '^f .ul A' -; ;•■ •>■ ;^ .sm; -,i 
 
 ■ ' It being six o'clock, the Speaker left the chair. ^''" '•=^*' ' * **'^^ 
 After recess, Hon. Mr. Boss resumed : ^ 'r.uxHo^; - ; > m 
 
 Mr. Speaker, when the House adjourned, I was referring to 
 the claim which T thought the Province had against the Domin- 
 ion Government in regard to railways. I took the position, and 
 still maintain that if our union is going to be continued, it must be 
 upon a basis of equal justice to all ; it must be upon the common 
 ground that where special grants in the way of relief, which are 
 but increased subsidies in disguise, are made to one province, 
 similar advantage's must be extended to the others also. The 
 people will not consent that the partnership shall continue to 
 exist if Ontario, being the largest contributing partner, is to be 
 ignored in the distribution of the assets. Hon. gentlemen opposite 
 adopted last year the statement that Ontario cont»'ibutes from 
 two-thirds to three-fourths of the revenue of the Dominion, but 
 even supposing that she contributes only one half, of the $2,400,000 
 given to Quebec in the manner I have stated, Ontario will be 
 called upon to pay $1,200,000 — is it reasonable that she should 
 be bound to contribute $1,200,000 in order to return to Quebec the 
 
THE HON. A. M. ROSS. 49 
 
 aid that Province has given to a local road, and be refimed her-self 
 a dollar in consideration of the roads which she has similarly 
 aided, and which are declared to be as much Dominion roads as 
 the one in the other Province — I do not think it is. I have a 
 statement prepared here as to the amount of aid given by the 
 Province for those roads assumed by the Dominion, taken over 
 and now called Dominion roads. In the statements heretofore 
 submitted of municipal aid, there has only been -ncluded, so far 
 as I have seen, the municipal aid that has been given since 1873. 
 Prior to that, before the settlement of the Municipal Loan f'und 
 scheme, large aid had been granted by the municipalities to many 
 roads. In the statement I will submit to the House I have 
 included the aid extended by the municipalities to the roads before 
 that date. By that scheme, also, the Province made expenditures 
 in regard to local roads, by reimbursing to the municipalities a 
 portion of the outlay they themselves had made. I take that 
 into account as Provincial aid granted and paid towards these 
 lines. I have also a statement shewing what has been contri- 
 buted by each county towards the roads within that count f, and 
 also shewing the total amounts, both provincial and municipal, 
 that have been given to the different lines of railway. Although 
 it may take a little time, I will read it over to the House, as it 
 will be of interest to the public and to the members representing 
 the different localities. (See Schedule at end.) 
 
 I have given in this table the total amount of aid that has 
 been given to every railway in the Province; every mile of these 
 railways has been taken over by the Dominion. We have not a 
 single mile of railway left over which the Province has control. 
 
 Mr. Meredith. — Yes, two miles and a-half. , 
 
 Hon. Mr. Ross. — Oh, two miles and a-half, are there ? We 
 ought to be thankful for small mercies. These statements have 
 been made up from the returns of municipal aid in the Dominion 
 Sessional Papers of 1882. ... , , . r 
 
 It will be seen that there has been given a total municipal 
 
FINANCIAL STATEMENT OF 
 
 aid of $12,624,849, and a total Provincial aid of $7,967,084, or a 
 
 total municipal and Provincial aid of $20,591,952. o u: ixiumt.^^ 
 
 I come now to the estimated receipts for the current year, 
 
 which I will read to the House. t"^i '•_.:;'<' •.;ij '-r. >;"' mn 
 
 ■vl- ;i,T Ht, '.i'J:a! h'V!ni;'.'«j Jn:>.'U")j,v1«'. 
 Estimated Recbipth, 1886. , . , ,|| 
 
 Subsidy $1,196,872 80 
 
 Interest on capital held and debts due by the Dominion 
 
 to Ontario «279,111 10 'JMnnum 
 
 Interest on investments 50,000 00 
 
 329,111 10 
 
 Crown Lands Department:— '' -<■ cjr?»:^ji^''l.i.i,).- ■<.■' vOi^-i ^,!UH in :, i ; r 
 
 T/ Crown Lands. ..wAu*. $115,000 00 -i' ii.c'. 
 
 ' Clergy Lands 12,000 00 ,j,, , , 
 
 ^ Common School Lands 21,000 00 '■,"', 
 
 <. Grammar School Lands 2,000 00 ir-iUiU-yA 
 
 Woods and Forests 450,000 00 
 
 600,000 00 
 
 
 Public Institutions:— ^' =■'''■ 
 
 Toronto Lunatic Asyhim $32,000 00 
 
 ;, London .. 10,000 00 
 
 Kingston m 4,000 00 
 
 - Hamilton .. 5,000 00 
 
 ; Orillia M 2,000 00 
 
 Reformatory for Females 5,000 00 
 
 Boys 500 00 
 
 J, Central Prison 32,000 00 
 
 ^ Deaf and Dumb Institute 500 00 
 
 91,000 00 
 
 Education Department $37,000 00 ;. :. • ; ! ■ ,c, 
 
 ". . (School of Practical Science).... 1,000 00 
 
 38,000 00 
 
 Casual Revenue 34,000 00 
 
 Licenses 168,000 00 
 
 Law Stamps .'..... 66,000 00 
 
 Algoma Taxes 10,000 00 
 
 Drainage Assessment 25,000 00 
 
 Municipal Loan Fund 10,000 00 
 
 Mechanics' Institute, Toronto 6,165 00 
 
 Insurance Companies' Assessments 3,000 00 
 
 Assessment of Counties re Removal of Lunatics 6,000 00 
 
 Agriculture and Arts Association re Agricultural Hall. 2,000 00 
 
 Total .■i»j.{^j jji.^,j,.fK*«fiJ> I* •**^tMf'>i> «««*•-♦• ■ $2,585,148 90 
 
 Now hon. gentlemen will notice a considerable reduction in 
 the amount we expect to receive from licenses. Last year our 
 
THE HON. A. M. ROSS. 
 
 Si 
 
 estimate was $200,000; we received $211,000. This year we 
 estimate to receive only $168,000. This reduction is partly due 
 to the adoption of the Scott Act in a number of the counties of 
 the Province, which of course will reduce our revenues from 
 licenses. I may inention that the estimated reduction by the 
 adoption of the Act in these counties amounts to $24,091. Last 
 year also we received $10,403 from extra licenses issued by the 
 Dominion Commissioners, but as that A.ct has been declared ultra 
 vires, we cannot expect an} revenue from that source this year. 
 
 I may mention also that you will see in the estimates of this 
 year the sum of $2,000 in connection with Agriculture and Arts 
 and Agricultural Hall. Since last session a settlement has been 
 made with the Agricultural and Arts Association in regard to the 
 claim the Province had against them. We have agreed to accept 
 from the Association the sum of $4,000, in two yearly instal- 
 ments, as payment of the claim we had against them, the Associa- 
 tion giving us an assignment of the claims that they may have 
 against Mr. Jamieson for the proportion that he may have to pay 
 towards the improvements that were made to the premises, and 
 also a guarantee to the Province of ten years' use of the rooms 
 now occupied by the Provincial Board of Health and Bureau of 
 Statistics, so that in making this settlement we get $4,000 from 
 the Association, the rooms that we occupy for these two 
 branches and the Agricultural Department rent free for ten years, 
 besides the assignment of any claims against Mr. Jamieson. 
 
 Now it will be seen by hon. gentlemen who have the esti- 
 mates in their hands, that this estimate of receipts does not cover 
 our estimated expenditure. In the statement made last year 
 there was a deficiency also, and it may be as well to acknowledge 
 that we have now arrived at that point when we cannot expect 
 to meet all the demands that are made upon the Government and 
 continue the liberal relief we have been extending to the muni- 
 cipalities out of our ordinary revenue. If the Government is to 
 continue that liberality it must seek some additional sources of 
 revenue. The Province is growing in population. Every year 
 
62 FINANCIAL STATEMENT OF 
 
 there are new demands made upon the Government ; new outlets 
 spring up. Either through municipalities or associations, repre- 
 sentations are made to the Government, and where they show 
 that the proposed expenditures are in the public interest, the 
 Government ought to be in a position to grant them. We have 
 thought that at present, having a considerable surplus on hand, 
 we should take any deficiencies out of the surplus rather than 
 shift any of our burdens upon the municipalities. We therefore 
 estimate that there will be an excess of expenditures over receipts 
 in 1885. 
 
 I^st year I drew the attention of the House to the fact that 
 although our population had increased largely since Confedera- 
 ation and a consequently largely increased expenditure forced 
 upon us, our revenue from the Dominion, which was intended 
 mainly to meet that expenditure, remains stationary ; and I said 
 there was a great deal of force in the contention that the sub- 
 sidies to the Provinces ought to increase as population increases. 
 Since last session I think circumstances occurring at Ottawa 
 have confirmed my impression that it is just ind right that the 
 subsidies should be rearranged on that basis. Within the past 
 year several Provinces have made demands upon the Dominion 
 Government for increases under various pretexts. We know 
 that the Province of Quebec, as I have already stated, sought 
 from the Dominion Government $2,394,000 on the plea that they 
 had constructed and given aid to a line of railway in the interest 
 of the Dominion. We have seen that they forced acquiescence in 
 that demand. We have seen, during the summer, Manitoba 
 sending a deputation to Ottawa asking for an increase of subsidy. 
 We have seen within the last two weeks a deputation from Nova 
 Scotia, also putting forward claims upon the Dominion Govern- 
 ment andfasking for an increase of subsidy. We also know that 
 there are several Provinces now indebted to the Dominion 
 Government^for advances. The Province of New Brunswick has, 
 1 believe, drawn its subsidy a year in advance. We know from 
 past experience, when demands of this kind are unitedly pressed 
 
THE HON. A. M. ROSS. 58 
 
 — and there is union on such questions in other Provinces, al- 
 though not in Ontario — they are always successful. Is it not 
 time then that Ontario should take firm ground for some final 
 arrangement that vr'W do equal justice to all. It will not do to 
 go on as we have been doing. The financial basis of Confedera- 
 tion is not giving satisfaction. The proof of that is that these 
 other Provinces have been coming to the Dominion Government 
 from time to time pressing these claims, which are merely in- 
 creases of subsidy in disguise, and persuading the Dominion 
 Government to accede to them. I say this system of special 
 grants is pernicious and demoralizing in its effects. What is the 
 result of it ? What is its tendency ? Is it not to encourage in 
 the Provinces an ignoring of the responsibilities for the future, 
 and a more ready acquiescence in present extravagant expendi- 
 tures, feeling that the Dominion is at their back and bound to 
 relieve them when they get into difficulties. I say that this has 
 a tendency to lead to improvidence in the Provinces, and that it 
 is time that we ought to have a final readjustment of the finan- 
 cial basis of Confederation, putting it upon some permanent 
 ground that would give relief and at the same time take away 
 from the Provinces the inducement to extravagant expenditures. 
 That should be sought by some means that would do justice to 
 all. Looking at all " the circumstances, I believe that the fairest 
 basis of revision would be the readjustment of the subsidies every 
 ten years on the basis of population. That basis of population 
 was adopted as the most equitable &i Confederation. Population 
 and expenditure are closely connected. The expenditure of a 
 Province increases as the population increases, but under our 
 present system that increase brings no additional revenue to the 
 Province, but it does to the Dominion. It is from that source 
 their principal revenue is derived. Increased population means 
 increased consumption of dutiable goods which swells their 
 customs receipts. We spend large sums yearly on immigration. 
 Every additional immigrant brings additional revenue to the 
 Dominion, but the Province does not participate in it. The 
 
54 FINANCIAL STATEMENT OF 
 
 Dominion derives all the benefits in a revenue point of view, and 
 the Province none ; on the contrary, an increased expenditure is 
 thrown upon it. Tlie administration of justice, schools, hospitals 
 and charities, the care of the insane, — all these expenditures must 
 be increased with the population. :^"""' " "' '''"'" '' '* ^'*' "« 
 
 Now, at the time of confederation, a division was made as 
 between the Provinces and the Dominion. What were the total 
 revenues in 1867 of the four Provinces which went into 
 confederation ? $13,687,928, and of that they apportioned to the 
 Provinces, for the purpose of carrying on the local government, 
 $2,753,966. It was considered right, then, to make the division 
 so that the Provinces should receive one-fifth, and the Dominion 
 the other four-fifths. What is the position of affairs now ? We 
 find that the Dominion revenue in 1884 was $31,861,961. They 
 gave as subsidies to the Provinces $3,606,672, or only one-ninth 
 of the total revenue in 1884, though it had been considered an 
 equitable division in 1867 to give the Provinces one-fifth. (Hear, 
 hear.) Then, looking at the matter purely as regards items of 
 revenue that are taxation ; that is, the revenue that the Dominion 
 derives from customs and excise. From these two main branches 
 of taxation, direct or indirect, as you may call them, was derived 
 in the four Provinces in 1867, $11,580,968. In 1884 the Do- 
 minion derived from these same Provinces for customs and excise 
 $23,711,745, or an increase of taxation of $12,130,777, but of 
 that increase they gave the Provinces nothing. The Dominion 
 grasped the whole. Is that equitable or fair ? Then, as it might 
 be objected that these particular years, 1867 and 1884, do not 
 properly represent the true proportion between now and tnen, J 
 have taken the average of the first three years of Confederation 
 and the last three years, from 1867 to 1869, and 1882 to 1884, 
 taking the two larger Provinces of Ontario and Quebec alone, the 
 total amount derived from customs and excise in the first three 
 years was $9,774,987. They are now collecting by increased 
 taxation from these two Provinces, $21,345,789. 
 
 Mr. Meredith. — That was Mr.Norquay's argument. 
 
THE HON. A. M. ROSS. 55 
 
 Hon Mr. Ross. — If it was, it is a good argument. I believe it 
 would be in the interests of Manitoba, sj& well as in the interests of 
 Ontario and Quebec to have some final settlement made. The hon. 
 gentleman's remark merely confirms what I have stated that dis- 
 satisfaction is existing in all the Provinces regarding the basis of 
 Confederation. But if the other Provinces have reason to com- 
 plain, Ontario has more reason, for on various pretexts the other 
 Provinces have got special increases, when no equivalent was 
 given to Ontario. While on the only occasions on which Ontario 
 has received anything from the Dominion, it was only in con- 
 junction with full equivalents given to the other Provinces at the 
 same time. Last year when they gave Quebec an increase, did 
 they give Ontario an equivalent ? Not at all. 
 
 Then with regard to the proportion per head of population. 
 In 1867 the taxation from these two sources of customs and 
 excise was $3.74 ; in 1884 it was $5.86 per head, and the 
 Dominion absorbs the whole of this large increase and gives none 
 to the Provinces except what has been given in 1873 and this last 
 year. As some new basis, that will be a finality, must evidently 
 be sought, I suggest, as an equitable one, that the Dominion 
 subsidy should be increased every ten years, according to the 
 population at the decennial census ; no Province then would be 
 able tc find fault Each one would get a share in proportion to 
 its population, and an increase as that population increases. No 
 more equitable basis could be devised, because, as I stated before, 
 it is largely from the increase of the population that the Dominion 
 derives its increased revenue, and largely from increased popula- 
 tion that increased expenditure is forced upon the Provinces 
 The Provinces cannot go on providing for the increasing wants 
 of the population if their revenues are to remain stationary. ,^^^ 
 
 An Hon, Member. — How do the states of the Union do ? ^^ ,* 
 
 Hon. Mr. Eraser. — They impose direct taxation. 
 
 Hon. Mr. Ross. — They impose taxation, but I say, is it fair 
 that the Dominion Government, starting upon what was supposed 
 to be an equitable division of the revenues at the time confedera- 
 
56 FINANCIAL STATEMENT OF 
 
 tion was formed, .should go on doubling the taxation of the 
 Provinces, taking the whole increase themselves, and allowing the 
 Provinces only the resort to direct taxation ? Wliat I object to is 
 that the present system of granting specific sums to particular 
 Provinces, whenever they are pressed with sufficient persistance, 
 has a demoralizing tendency and leads to extravagant expenditure. 
 They know that if they can bring any political influence to bear 
 upon the Dominion Government, they can obtain relief from their 
 embarrassments. I do not care if you cut off the subsi'l ies from the 
 Provinces altoether,and leave them to direct taxation,so long as you 
 deal with them all equally and alike. But I say that so far as the 
 Dominion Government are concerned, they are not merely content 
 to leave our revenue stationary, while their own is increasing largely, 
 but they endeavor by all the means in their power to reduce the 
 revenue givtm to us by confederation. Have they not endeavored 
 to take from us our license revenues that we have been in posses- 
 sion of since confederation? " ?' » / 
 
 An Hon. Member.- No, no. ' '' ' " ' ' ' ' 
 
 Hon, Mr. Ross. — What was the McCarthy Act ? Does it not 
 take away from us the revenues from wholesale and vessel and 
 druggists' licenses and fines ? I think that is the intention. (Hear, 
 hear.) I shall be very glad to hear that the Dominion Government 
 make no such contention, and I hope the hon. gentleman is now 
 expressing himself intelligently, and with fore-knowledge of what 
 are the views of the Dominion Government on that question. 
 
 Now, Mr. Speaker, so far, the Provincial Government, not- 
 withstanding these disabilities under which the Province has 
 been labouring, have been able to meet the existing demands of 
 the Province, and still we have a surplus in our treasury which 
 will enable us to mcec anything but extraordinary demands for a 
 few years to come. But if we have, by economy and the wise 
 administration of our finances, placed ourselves in a better position 
 than some of the other Provinces, it is not right that that should 
 fee cast up to us as a reason why grants should be given to other 
 J*rovinces and denied to us. (Hear, hear.) I say that it is use- 
 
THE HON. A. M. ROSS. 57 
 
 less for Ontario to stand idly by while other Provinces are coming 
 successively to the Dominion and asking, under various pretexts 
 and specious pleas, for increased subsidies, which, in every 
 instance, taking advantage of opportunities, they have succeeded 
 in getting. I say it is time for the Province to take a more 
 united stand in regard to this. I am sorry to say that there 
 seems to be in the people of this Province a lack of that local 
 patriotism, that loyalty to their own Province, that characterizes 
 the people of the other Provinces, that has enabled them, by their 
 united patriotism, to secure a recognition of their demands. This is, 
 perhaps, due to the doctrines that have been assiduously preached 
 lately in Ontario, that the first and highest allegiance of the people 
 is due to the Dominion and not to the Province. That when repre- 
 sentations have been made of the injustice done to the Province 
 of Ontario by the Dominion action, whether in the attempted 
 robbery of her territory, the alienation of her revenues, or the 
 infringement of her legislative rights, we have seen those who 
 aspire to be leaders, in rounded phrases, reminding the people 
 that they are building up a grand Dominion, and that Provincial 
 interests are only of secondary consideration. What has been 
 the result of that doctrine ? Had we not the spectacle last year 
 at Ottawa, that, when a proposition was made co do justice to 
 Ontario, by returning to her as had been done to another Pro- 
 vince, a portion of the aid given to construct Dominion roads, 
 that proposition, althou^.i generally supported by Liberal mem- 
 j bers of other Provinces, was, for party ends, voted down by the 
 jroices of Ontario representatives. (Hear, hear.) It is time that 
 ''Ontario assumed a firmer and more united attitude in assertion 
 of hev riajhts ; and I trust she will, by united voice, demand the 
 isame recognition of her outlay on Dominion railways that has 
 been accorded to other Provinces, and insist on an equitable and 
 final adjustment of the basis of Confederation, both financially 
 and constitutionally, which will give her that justice which the 
 practical working out of the present arrangement as at present 
 administered, does not secure to her. (Applause.) 
 
 Mr. Speaker, I beg to move that you do leave the chair. 
 
58 
 
 FINANCIAL STATEMENT OF 
 
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