The commissioners will not get money direct. The payments will be made by the government upon the certificates of the commissioners but the commissioners from time to time will have to deposit debentures equivalent to the moneys paid, the, commissioners will not receive this money at all. This money is paid by the government upon the application of the commissioners, but the money will not be handed over to the commissioners to be expended by them.
Mr. BORDEN (Halifax).
I think that is a proper qualification to my remarks. What is the object of the debentures after all ?
This is following the method adopted in previous cases where the money is advanced for public purposes to commissioners, as in the case of the Montreal Harbour Commissioners.
But the Montreal harbour is indebted to the government.
Quite so, and this railway would be indebted to the government.
No, because the railway belongs to the government. I do not see the object of the government issuing debentures to themselves on their own property.
The next clause says that these debentures shall form the first lien and charge upon the eastern division. Is It the intention of the government that they are to take the form of bonds ?
The debentures will become a species of railway bonds, but they will not be issued to the public.
That involves the question of title. '
The question of title has to be looked into.
Did the Minister of Finance consider the possibility that some future government may not be as honest and capable as the present, and that they may find in their possession a number of debentures which are really a charge upon the property of the country, and yet could not be sold at as good a figure-because the road may not pay-as the rate the country could borrow money. It might be a temptation to that subsequent _ government to dispose of these debentures in an impro-' vident manner.
That may be possible, but not probable. However, we will consider the point.
Section allowed to stand.
On section 26,
I beg to move the following amendment to this section :
27a. It shall not be necessary, in order to preserve the priority lien, charge, mortgage or privilege purporting to appertain to, or be created by any bond, or debenture or other security issued or any mortgage executed under the provisions of this Act or on the said agreement that such bond, debenture or other security or such mortgage should be registered in any manner, or in any place whatsoever; but every such mortgage shall be deposited in the office of the Secretary of State, of which deposit notice shall be given in the ' Canada Gazette '; and a copy of such mortgage, certified to be a true copy by the Secretary of State or his deputy, shall be received as prima facie evidence of the original in all courts of justice, without proof of the signatures or seal upon such original.
I can see that it might be convenient to have debentures issued and held by the government for a reasonable outlay if the amount is fixed, but under this clause it is contemplated that from time to time during the fifty years the commissioners would have to issue debentures to the government for outlays on capital account all along. That would complicate matters very much, because evidently the future expenditure would have to be treated in the same way, and debentures issued from time to time. Some method would have to be devised as to bow and when these debentures are to be issued, unless you are going to earmark them as a special security. I understand that there is no intention of earmarking them as a special security for the money market. _
No, these would not go to the money market. They would be set apart as a security representing this particular work.
Is it intended! to keep them apart as security for the money borrowed on the money market from time to time ?
. The MINISTER OF FINANCE. These securities will not be issued to the public. The loans will be effected on the credit of Canada irrespective of these securities.
There will be no reference to these in the moneys borrowed by the government ?
That is correct.
Then it is a mere matter of bookkeeping, and I do not see that it is going to do much good to issue them.