August 5, 1904


Motion agreed to, and Bill read the first and second time, considered in committee and reported. On motion for the third reading.


LIB

Louis-Philippe Brodeur (Minister of Inland Revenue)

Liberal

Mr. BRODEUR.

I wish to say a word with regard to a question which was discussed in the House yesterday as to the rebate paid on cuttings of foreign leaf exported from this country. I wish to say to my hon. friend from Yale and Cariboo (Mr. Galliher) that this matter has been engaging for some time the attention of the department. As I have only been Minister of Inland Revenue for a few months, I have not been able to consider the matter fully, but it has been engaging my consideration and I hope to be soon able to announce a matured policy on that question.

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LIB

PURCHASE OF THE CANADA EASTERN RAILWAY.

?

Hon. II R.@

EMMERSON (Minister of Railways and Canals) moved the second reading of Bill (No. 163) authorizing the government of Canada to purchase the Canada Eastern Railway, and to take possession of the Fredericton and Saint Mary's railway bridge.

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CON

John Graham Haggart

Conservative (1867-1942)

Hon. JOHN HAGGART.

Mr. Speaker, before the Bill is read' the second time, I wish to make my protest against the acquisition of this railway. The Minister of Railways has given no explanation which would justify such an enormous expenditure as $800,000 for the purpose of acquiring what is a perfectly useless undertaking. W nat are the facts ? Here is a railway 136 miles in length which has been running through a section of New Brunswick for nearly twenty years. The minister describes the country through which it passes in glowing terms. The earnings of the road for freight and passengers at one time amounted to $137,000, but for the last three or four years they have been running down, and they now amount to only $116,000. I learn from the papers which have been laid on the table of the House, that this road ceased to run and was virtually abandoned as useless ; and petitions from boards of trade in Fredericton and other places were sent to the government asking that some means be taken to compel the parties in possession of the road to run it. The net earnings of the road are stated to be in the neighbourhood of $2,400. And this is the road for which we are asked to pay the sum of $800,000. When the resolutions were before the House, I stated that the cost of the road was $1,700,000. The Minister of Railways contradicted my statement, saying that the expenditure for building the road was largely in excess of that sum. The report of the Deputy Minister of Railways on the road shows that my statement is perfectly correct. He states that the parties who are selling the road stated that it had cost to build about $2,100,000 ;

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but be found that the actual cash expended upon it was about $1,700,000. He values the road at $1,200,000, but he does not regard it as a running concern at all. Any

one who examines the returns made by this railway to the department will find that commercially it is an entirely useless undertaking. The party who was running it states further, what the minister ought to have stated to the House, that to put the road in running order will require an expenditure of nearly $800,000, or a net expenditure of $547,000. So that we are not only expending $800,000 to acquire the road, but are probably incurring a further expenditure of $547,000 to put it in running order ; which means an expenditure by the government of nearly $1,400,000. The min-iser said that the road runs through a comparatively easy section of country-that the gradients and curvatures are fairly easy. I see by the return made to the department that none of the curves are very sharp ; but the only information we get with reference to the gradients is that the highest is 80 feet to the mile. That shows at once that the road is not up to the standard of modern railways. The minister said that it was true the gradients were 80 feet to the mile, but that there were very few of them. He must remember that one gradient on a road of 136 miles fixes the standard for the whole road-the strength of a chain is the strength of its weakest link. The return shows that the natural rise of the country for the 136 miles is 1,900 feet, and the fall the same. This shows at once the impossibility of getting a road of easy gradients through the country. Now, what is the object of the government acquiring this railway ? The minister says that if it passes into other hands, it may divert some traffic from the Intercolonial to another railway. The whole traffic, as I have shown, is only $116,000. Is there any railway company in the country which is anxious to acquire this road V All they want is to keep the road running. The probability is that with its present earnings it could not be kept running. The minister says that the bad showing on the road for the last two or three years is accounted for by the large expenditures made on the road to bring it up to its present standard. The entire average expenditure on the road for repairs and everything else during the last four or five years has been about $40,000 a year.

It is less than what any other road in the country, which is doing any business at all, expends for the same distance for the ordinary repairs, track repairs and so forth. The road has wooden bridges which we will have to replace by iron ones. You will have to lift the whole iron on the road, according to the deputy minister's report. The rails are pretty well worn, sixty to Mr. HAGGART.

sixty-five pounds to the yard, and wifi have all to be taken up and replaced. The deputy minister makes the calculation that to put the road in running order, without

rolling stock at all, will cost $547,000. What possible justification can be given for this ? I venture to say that there will be a loss every year we own the road of $100,000 a year for all time to come, if we keep it in proper repair. There is the transaction in all its nakedness. A road 136 miles long on which you will have to spend $600,000 to put it in running order, the gross earnings from which are $116,000 a year and the net revenue $2,400. And we are asked to spend $1,400,000 to acquire that road, ft would be better, in the interests of the country, that the sum was made a present of or pitched into some bog hole on the Intercolonial, because the road will entail a loss to the people for all time to come of a large sum apart from this expenditure. Surely when a proposition of this kind is sent to the people there should be some reason given to justify it. Is there any explanation ? It is not taken as a commercial undertaking. The only reason given is this. That it might pass into the hands of the Canadian Pacific Railway, that the Canadian Pacific Railway have had an option on it, and could have had it for $800,000, and that it is dangerous to allow the traffic to be diverted to that line. And there is the bridge. That bridge cost $350,000, which of course was a bad investment, and as it was made in our day, I suppose we are partially responsible. We built the bridge across the river for the purpose of getting into Fredericton, and what was the result ? We have never received a cent of interest up to the present, nor are we ever likely to. What a precedent are we not setting. Every road that makes connection with the Intercolonial will be in the same position as this one. if the government adopt the policy, which is given as the reason for the purchase of this road, namely, that it is to prevent the traffic of this local line from being diverted to the Canadian Pacific Railway, we will be asked to apply that policy to every road that connects with the Intercolonial. Are you going to acquire every such road in Nova Scotia and New Brunswick and own and run them as government roads ? In our section of the country and every other section these matters are left to private enterprise. What I want is to enter my protest At this late hour I believe it will have no effect in the House, but I hope it will reach the country. With all this enormous expenditure on capital account on the Intercolonial which we are passing this year, an expenditure of over $6,000,000, with an expenditure on repairs of $6,400,000, with a loss on this undertaking last year of $2,700,000, I think it is high time to call a halt. It is time that the people impressed on the

government that such heavy and useless expenditure should be put an end to. We have had enough of these expenditures. The Finance Minister may plume himself upon the maritime provinces being well looked after.

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LIB

William Stevens Fielding (Minister of Finance and Receiver General)

Liberal

Mr. FIELDING.

And the other provinces too.

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CON

John Graham Haggart

Conservative (1867-1942)

Mr. HAGGART.

No, the revenue of the government has not been distributed equally since 1896. During the present year we are called upon to meet a loss or deficit on the two government railways in the maritime provinces of $2,700,000. We are voting this year on capital expenditure in New Brunswick, Nova Scotia and Prince Edward Island an amount of $6,400,000, taking this great Canada Eastern into account. There has been an expenditure since 1896 of nearly $27,000,000, and the expenditure to which we are pledged this year will bring this amount up to nearly $30,000,000. What becomes of the beautiful surplus the Finance Minister boasts of from year to year ? He congratulates the country on its being a growing time, congratulates the people on the fact that although we have taken a large sum of money from them in taxes we have not gone into debt, we have expended it in useful and beneficial undertakings in different sections of the country. I believe in the principle that there should be a fair distribution among the different provinces of the Dominion, except perhaps that in the newer provinces where we cannot expect that they would contribute the amount necessary for the works that are required in those particular parts, it is the duty of the older provinces to contribute, and if necessary to contribute lavishly, towards the expenditure in those sections of the country. But in the older sections of the country I believe that we ought to adopt the principle of returning expenditure to the people of the different sections of the Dominion according to the amounts they have paid in or according to their population, and it should not be the boast of any minister or any particular party that of the immense surplus which has been wrung out of the people in the shape of taxes, a large amount has been distributed in a particular portion of the country.

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LIB

William Stevens Fielding (Minister of Finance and Receiver General)

Liberal

Mr. FIELDING.

I did not make any such boast as that these moneys were distributed in a particular part of the country. I said they were distributed fairly and equitably throughout the whole Dominion. My hon. friend may or may not agree with me, but that is what I said.

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CON

John Graham Haggart

Conservative (1867-1942)

Mr. HAGGART.

Let me have an explanation of that. The hon. minister was talking about his section of the country being fairly looked after, and I cried, ' hear, hear.' The minister asked that it be taken down and he would make use of it, and I said ' So will I.*

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LIB

William Stevens Fielding (Minister of Finance and Receiver General)

Liberal

Mr. FIELDING.

I expect that.

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CON
LIB

Henry Robert Emmerson (Minister of Railways and Canals)

Liberal

Mr. EMMERSON.

And you are trying to do so now.

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CON

John Graham Haggart

Conservative (1867-1942)

Mr. HAGGART.

I noticed that the minister thought he was on dangerous ground at the time and went on to say that the money was fairly distributed. Let the minister state what section of the country other than the maritime provinces has received an expenditure to be compared with this expenditure of $26,000,000 over and above the receipts of the railroad in that section of the country ? That amount has been expended there in capital or in deficits upon the road. Following that they ask us at the present session for an appropriation of $6,400,000 more on capital account to be expended this year. Where is there a corresponding expenditure in any other section of this Dominion V

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LIB

William Stevens Fielding (Minister of Finance and Receiver General)

Liberal

Mr. FIELDING.

The difference between my hon. friend and myself is that he seems, as I said the ether day, to be lying awake at night, making up calculations as to the amount of the interest on the expenditure in the maritime provinces. I have no doubt that if hon. gentlemen from the maritime provinces desire to pursue the same narrow and miserable policy, they might make calculations as to the expenditures in other provinces, but I may say without hesitation that that is not a creditable policy for the representatives of any section of the country to pursue. The question is, is there any section in this Dominion having demands upon the treasury of Canada for fair and legitimate purposes which are not being met ? If he can show that there is any legitimate work in Ontario which has sought aid and been refused, then, to the extent of that case, he will have some ground for criticism, but if we are able to show, as we can show, that everywhere from east to west and from north to south, all claims have been fairly considered, and public moneys appropriated to meet the needs of different sections, then I think his criticism is unjust. The conditions in all portions of the Dominion are not alike. In one section of the Dominion you desire expenditures in one line, and it may be that in particular one province seems to get more than another, but in another section some other branch of public service requires a larger expenditure. It is not well to take a provincial view of matters of this kind. My hon. friend must know that vast sums have been expended and are still being expended on the canals. They are largely for the benefit of the section through which they run. But to lay stress on that would be a narrow view and although the people in the maritime provinces may never see these canals, we educate our people to the belief that these are thing*

for the good of Canada generally, and we are willing to bear our share of the expenditure. Is my bon. friend going to adopt the miserable find narrow policy of going into the back counties of his province and making calculations as to how many cents per head the people paid a year ago in the east, because he knows that his people may not be acquainted with that section of the country and its needs ? I believe there is intelligence enough in all sections of the country, that there is intelligence enough in the great premier province of Ontario, to condemn that narrow policy and to stajid for a policy that is not for the maritime provinces, not for the province of Ontario or the province of Quebec, but for each and every section, and for the Dominion as a whole.

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Motion agreed to, and Bill read the second time. At one o'clock, House took rece'ss. House resumed at three o'clock. House went into committee on the BUI. On section 4,


CON

Samuel Barker

Conservative (1867-1942)

Mr. BARKER.

I would like to call attention to the terms of the 4th clause. It simply enables the government to take possession of the bridge.

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LIB

Henry Robert Emmerson (Minister of Railways and Canals)

Liberal

Mr. EMMERSON.

Which the government is entitled to do at any moment now.

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CON

Samuel Barker

Conservative (1867-1942)

Mr. BARKER.

Certainly, a mortgagee is always entitled to take possession of a property if the mortgagor is in default. But when you foreclose a mortgage you declare that the eqnity of redemption of the mortgagor is foreclosed. What you are doing in this section is simply to authorize the government to take possession. That does not do away with the equity of redemption of the mortgagor. I do not see anything in this statute that will prevent the bridge company hereafter if the property should appear to become valuable, to come back and seek to redeem it, and I daresay the government would be glad to allow them redemption. But the idea of this Bill is a foreclosure, and I submit that some more words are required. A mortgagee may take possession, but that obliges him to account for receipts to the mortgagor, for whom he is only the trustee. I submit that the minister ought to consider whether he cannot use proper foreclosure words in this clause, so as to wipe out the equitable title of the mortgagor.

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LIB

Henry Robert Emmerson (Minister of Railways and Canals)

Liberal

Mr. EMMERSON.

While parliament is all-powerful. I think we should recognize even the rights under the original contract. I do not think it would be fair for us arbitrarily to foreclose without a consideration, as contemplated by the original contract. My own ideas are that the mortgagees have no rights, my own ideas are Mr. FIELDING.

that the amount of money, the principal and interest, entirely precludes them from coming in and asking any further consideration. Yet I would feel that we should do justice, and I think we are going as far as we ought to go in justice in declaring that we shall take possession. We could do it without this declaration by parliament, a declaration is not necessary. Yet I feel that we would be dealing unfairly with the parties who may have an interest. T do not think they have any, but if they have, it must be recognized. It seems to me that we are going as far as we properly should in the declaration that we are making today. Now I am very sorry my hon. friend has taken a sectional view of this matter.

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August 5, 1904