March 4, 1912

LIB

William Pugsley

Liberal

Mr. PUGSLEY.

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
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LIB

William Pugsley

Liberal

Mr. PUGSLEY.

I presume so, and it is carried forward in the revised statutes. Now, Mr. Speaker, it seems to me that if Manitoba wants more money to enable her to carry on the affairs of government, and to properly develop her territory, we ought to do the same as was done in 1885; we ought to readjust the debt account as between the different provinces. We should endeavour to treat all fairly. It seems to me further, that we should try to make an end1 of the matter as between the different provinces; we ought to have it embodied in the British North America Act, and make it as nearly final as it is possible to make it. Picking out first one province and then another and dealing especially with it, and so tinkering from time to time with the constitution is exceedingly unsatisfactory, and is likely to cause great discontent as between the people of the different provinces. I want to know why my right hon. friend and his colleagues do not consider the whole question now. Take the case of British Columbia. British Columbia is not nearly as favourably situated as Manitoba will be when this Bill passes. British Columbia is growing with equal if not greater rapidity than is Manitoba, and there is no reason in the world why British Columbia should not receive- equal treatment. But my right hon. friend may say: we will deal with British Columbia by itself; the government of British Columbia has demanded that a commission in the nature of arbitrators shall be appointed to deal with the claims which that province is putting forward; the government of British Columbia has demanded that there shall be appointed three commissioners, one to be chosen by the federal government, one by the government of British Columbia, and the third to be appointed by the commissioners so chosen, and, as appears in the press despatches, the federal government has consented to leave the case of British Columbia to that arbitration. I submit that is exceedingly unsatisfactory. What is to be done in respect to the claims of the other provinces of the Dominion? Are there claims to be dealt with by a commission; are they to have similar special treatment? We have had no intimation so far as to what treatment is to be accorded to the three old provinces of Nova Scotia, New Brunswick, and Prince EdL ward Island. The people of these provinces have borne the burden connected with the development of conferedation, the building of the Canadian Pacific railway and the construction of other public works for the benefit of the whole country. They have borne their share of the burden cheerfully with the Test of the people of Canada, but I do not observe any indication on the part of this government that their special claims

are to be considered. Is there to be a commission of inquiry as to what claims they have on the public treasury? We have no announcement as to that, but what the government is doing to-day is picking out the one province of Manitoba, giving to it special treatment, and proposing to pick out British Columbia, and through the medium of a commission, accord to that province special treatment as well. In considering this question of debt account, it might be well to deal for a few moments with the basis upon which the debt account of the provinces was provided for by the Act of Confederation. In the case of the four original provinces, the debt account was something tangible; it represented something. In the case of Optario and Quebec, the two original provinces, they had actually expended at the time of confederation, sixty-seven million dollars, for which they were in debt, and this was afterwards discovered to amount to seventy-three million dollars. They had built the great canal system of which Capada is so proud, and which was even then a great system, although it has since been vastly unimproved; they had built other public works and they had incurred this indebtedness actually. The province of Nova Scotia at the time of confederation had built a line of railway from the city of Halifax to the New Brunswick boundary and it had constructed the Windsor branch and other portions of what is now the present Intercolonial railway system. Nova Scotia went into the Dominion with a debt account of eight million dollars, which was actually expended upon public works, and all of which were to be passed over to become the property of the Dominion. After confederation in 1869, it was discovered that between the time of the Quebec conference and the coming into force of the Act of Union, the province of Nova Scotia had expended a very considerable sum which had not been taken into account when the debt was fixed at eight millions, and subsequently the debt account of that province was increased from eight millions to over nine millions. At that amount it remained until 1885, when there was a general pro rata increase of debt allowance among the different provinces of Canada by the statue to which I have referred. ! But, that debt amount did not represent paper as this allowance to Manitoba does. That amount was allowed to the province of Nova iScotia because Nova Scotia had actually gone into debt, and constructed public works to that extent, which were transferred to the federal government. But in the case of Manitoba the Bill itself recites that whereas Manitoba had no debt when she went into the union, therefore, it is pro-

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
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LIB

Wilfrid Laurier (Leader of the Official Opposition)

Liberal

Sir WILFRID LAURIER.

Hear, hear.

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
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LIB

William Pugsley

Liberal

Mr. PUGSLEY.

That is absolutely provided for by the terms of the British North America Act. In subsection 10 of section 92, of that Act, are set out the works which are assigned to the provinces:

Local works and undertakings other than such as are of the following classes

Lines of steam or other ships, railways, canals, telegraphs and other works1 and undertakings, connecting the province with any other or others of the provinces, or extending beyond the limits of the provinces.

Any railway which extends beyond the limits of the province, is within the exclusive jurisdiction of the Dominion parliament. But, then it may be said: This

parliament can authorize the government of Ontario to build its railway in the territory of another province. I doubt that, Mr. Speaker. I do not think there can be any ground for that contention, because while I think parliament might authorize a company to build a railway there, and undoubtedly it could, yet the government of Ontario cannot construct a railway without public money; and I think it goes without saying, that this parliament could not empower the province of Ontario to expend the public moneys of that province in the construction of a railway which the legislature of Ontario itself could not authorize.

It would be a most anomalous proposition that this"parliament snould authorize the government to pay provincial money for the construction of a public work which the legislature of the province itself could not authorize. I take it that there can be no doubt whatever that the government of Ontario would have no power to construct a railway outside of the limits of the province of Ontario as is proposed by this order in council. So, I believe, Sir James Whitney has acted wisely in insisting that he should get this grant of over 760,000 acres and this waterfront upon the Nelson river and Hudson bay without being bound to build what he knows that his government cannot build, a railway through the territory of the province of Manitoba. It may be said that it is intended that this would be to enable the province of Ontario to give a grant to a railway company to build such a line. That is not the order in council; it is that the grant shall be made to the province of Ontario or a public commission or public corporation for that purpose. It is a grant to the province of Ontario, the road must be built out of the public money of the province of Ontario; and, as I have said, it seems to me there is no authority for the government of Ontario to build such a line of railway. I would ask my hon. friend the Minister of Railways if he has had a report yet as to where, in case the terminus of the Hudson Bay railway is to he upon the Nelson river, as to which side of the river these terminals should be constructed?

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
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CON

Francis Cochrane (Minister of Railways and Canals)

Conservative (1867-1942)

Mr. COCHRANE.

Judging from the report that was in, on the west side would be best-the far side from here.

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
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LIB

William Pugsley

Liberal

Mr. PUGSLEY.

The hon. gentleman says ' Judging from the report that was in,' the west side would be best. It does seem to me that until that matter is positively determined, it might hamper most seriously the operation of this government in connection with the construction of the Hudson Bay railway to give away to a provincial government some ten miles of waterfront which it might or might not utilize lor railway terminal purposes.

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
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CON

Francis Cochrane (Minister of Railways and Canals)

Conservative (1867-1942)

Mr. COCHRANE.

We would take good care of that.

Mr. PUGS'LEY. The hon. gentleman cannot ' take good care of that,' because he and the government have bound themselves, and when we pass this Bill parliament will have bound itself, in good faith to give to the government of Ontario ten miles along the eastern shore of the Nelson river, whether that is or is not the best place to establish terminals in connection with the Hudson Bay railway. In saying that ' they will take care of that ' he is simply saying that they will break faith with the

province of Ontario, to which, in order to induce them to become a consenting party, they have arranged to give this land.

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
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CON

Andrew Broder

Conservative (1867-1942)

Mr. BRODER.

Does the hon. gentleman (Mr. Pugsley) mean to say that the Dominion cannot run a road where it likes?

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
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LIB

William Pugsley

Liberal

Mr. PUGSLEY.

Undoubtedly it can, but it is not proposed that the Dominion shall build the road. It is proposed that the Ontario government shall build it.

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
Permalink
CON

Andrew Broder

Conservative (1867-1942)

Mr. BRODER.

I understood the hon. gentleman to argue that if the province owned this it might hamper the Dominion's right to get the port.

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
Permalink
LIB

William Pugsley

Liberal

Mr. PUGSLEY.

What I say is that the Dominion might build, *but that if this land is given away to Ontario and it turns out that this is the place where the terminals should be, then the government, in connection with the Hudson Bay railway, must settle with the province of Ontario before they can fix their terminals there.

Now, I did not intend to take up so much time; I regret that I have spoken at such length upon this subject. But it is one of a great deal of importance, one, I think, of vast importance. I think we ought not to deal with the matter by piecemeal. We are brought to-day by this Bill, face to face with very important changes in the constitution ' of several provinces. We are called upon to consent to the enlargement of the boundaries of the provinces. Important questions are raised. It does seem to me that the only satisfactory way in which these questions can be dealt with is to treat all the provinces of Canada as being interested in them. All the provinces to-day are interested in the public lands. Ail the provinces, of course, are interested in the amount of money that is given by way of subsidies. The only satisfactory way in which to deal with that is to call together the Premiers of the different provinces, just as was done in 1906, and ask them in consultation with this government to take up all these questions, all questions which are outstanding between these provinces, and reach a settlement upon some broad national basis which will relieve all grounds of dissatification and cause all the people to feel that complete justice has been done to each province and to the people of Canada as a whole.

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
Permalink
CON

Arthur Meighen

Conservative (1867-1942)

Mr. ARTHUR MEIGHEN (Portage la Prairie).

Mr. Speaker, this is the second day that this very important measure has been brought to your attention and the attc-nt'on of the House. On each occas-

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
Permalink
LIB

Frank Broadstreet Carvell

Liberal

Mr. CARVELL.

Suppose the time should come in the next two or three years when these lands will be surrendered to the provinces, would the hon. gentleman consider that this allowance in lieu of land should be discontinued?

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
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CON

Arthur Meighen

Conservative (1867-1942)

Mr. MEIGHEN.

It has been my habit in public life to cross bridges when I come to them. I apprehend that one will soon

be reached, and then I propose to give it as earnest consideration as I give to other questions. The chief point against which the attack of the opposition is directed is the other item of increased advance, namely, allowance in lieu of debt. Now, I may be pardoned if I trace the history of this allowance, and the reason for it. It has been done at different times in this parliament, but not very fully in this debate. When the four provinces of Nova Scotia, New Brunswick, Ontario and Quebec formed confederation in 1867, Upper Canada, comprising the latter two, was burdened with an indebtedness of some $67,000,000. That indebtedness was incurred for similar purposes as the other provinces have incurred indebtedness, which the other provinces incurred since that time, and have to bear themselves. Now I have stated that very briefly, and I do not intend to particularize, just what that money was expended for. But I say it will be clear to every member of this House that in the main that indebtedness which at that time burdened the provinces of Upper and Lower Canada and burdened the provinces of New Brunswick and Nova Scotia, was in the main incurred for those public works, for those public purposes that otherwise would have had to be borne, and have been borne since in the case of the other provinces, by the local exchequer.

Recognizing that, the fathers of confederation came to an understanding. I should have sftated that the debt thafs was at that time carried by New Brunswick was some $7,000,000, and that the province of Nova Scotia carried a debt of some $8,000,000. It was figured out by the framers of the Quebec resolutions, and then by the framers of the British North America Act, that the debt of Ontario at $67,000,000 was greater per capita than the debt of Nova Scotia and New Brunswick at $8,000,000 and $7,000,000 respectively. It was proposed that United Canada should take over these obligations and relieve the provinces and in order to reduce the per capita debt taken over by United Canada to the same basis in the different provinces $5,000,000 of the debt out of $67,000,000 was left standing on the shoulders of the two provinces of Upper and Lower Canada, and in the ultimate a debt of $7,000,000 for New Brunswick, $8,000,000 for Nova Scotia, and $62,000,000 for Upper and Lower Canada was assumed by. the confederation under this agreement in 1867. It was fixed at these figures in order that the debt assumed from the provinces of Nova Scotia, New Brunswick, Ontario and Quebec, would represent in a word $25 per head of the population. When, therefore, these four provinces came in, Canada assumed a per capita debt of $25 per head. Later on other obliga-

tions from the provinces were assumed by the confederation and the per capita debt was enlarged to $32.43 per head. At the time that was done a rearrangement among the provinces of the debt allowances was made in order to adjust that of each to the changed circumstances. We have thus proceeded on the assumption from confederation, or from a date prior to confederation, that the per capita debt of the provinces, which was found to be $32.43, should form the basis of a system of allowing to new provinces who might join later and thus share in the national burden, a compensation from the federal treasury when such provinces at the time of uniting had themselves no debt for the union to assume. So when new provinces were brought into confederation, by virtue of the Act of Canada alone, by virtue of the Act of this House, and it was found that these provinces, or territories then erected into provinces, had a less debt than $32.43 per head, or no debt, allowance had to be made in respect therefor. Manitoba came into confederation without any debt at all. Her debt, at the time she entered confederation, was nothing, and consequently it was assumed that the debt allowance to be made by Canada should be on the full basis of $32.43 per head of the population. The same principle applied when Alberta and Saskatchewan entered the confederation.

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
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LIB

William Pugsley

Liberal

Mr. PUGSLEY.

Is not my hon. friend mistaken? It was not on the actual population of Manitoba, but on an assumed population of 125,000, was it not?

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
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CON

Arthur Meighen

Conservative (1867-1942)

Mr. MEIGHEN.

I think that in the first place it was on a population of 17,000, but afterwards, in 1885, it was increased to the figures stated by my hon. friend. But, the point will not help my friend: it rather assists the argument that I hope to advance. In the case of Alberta and Saskatchewan, however, the population was figured, when they came into confederation iii 1905, to be 250,000 in each province. That '250,000, multiplied by $32.43, amounted in the aggregate to $8,107,500, and that was the capital allowance made in lieu of debt made to Alberta and Saskatchewan. Manitoba had come in in the earlier years at a time when her population was very sparse indeed, and the allowance in lieu of debt had necessarily to be figured on a smaller amount of population. Later on, as Manitoba advanced in population, that allowance was increased, as the hon. member for St. John (Mr. Pugsley), who has just interrupted me, says. But, what I want to point out is that a distinction between the allowance in lieu of debt has to be made by virtue of the fact that whem new provinces come into confederation they Mr. MEIGHEN.

thereby assume a share of the liability of confederation proportionate to their population, whereas, if they had remained out of confederation they would have had no share in that liability. Parliament set to work to do away with that obvious unfairness and the way it adjusted it was this, and it seems to me that if not exactly right the arrangement was conceived in a. spirit of fairness and at the time approximated thereto. Parliament has made a grant to each such province of five per cent yearly on its debt capitalization; that is to say, each province has entered confederation on a capital debt allowance represented by its population multiplied by 32-43, and five per cent per annum thereon has been granted as a subsidy in lieu of debt to each of these provinces. As we apprehend the ground work of this allowance in lieu of debt, we will come to more clearly understand this legislation in the case of Manitoba and whether or not a re-adjustment should take place in this case or any othe^-without a conference of the provinces. While the debt allowance was conceived in a spirit of fairness, and with an effect approximating thereto at the time, it will be seen that with the unequal advance of population in each of the provinces an unfair condition is certain to result. Had it turned out to be the case that each province had remained at the population it had when this debt allowance was made then the conditions should always have been fair and just between them. Had it even transpired, as may possibly have beep expected, that each province would advance proportionately in population, that is to say, that the advance would be at the same ratio in each, then likewise, the allowance in lieu of debt might have been said to have been on a permanent basis and have remained permanently fair between them. But, such has not been the case. Manitoba wag taken in with a very small population. It advanced rapidly. Manitoba came in with about 15,000 of a population, and she has to-day nearly 500,000. She bears the proportion of the national debt of this country that her present population bears to the population of Canada; that is to say she carries the burden now that her population bears to the whole population of Canada and not the burden that the population when she came into confederation bore to the whole population then. So it will be seen that with the unequal advance in the population of the provinces of this country a distinctly disjointed state of affairs arises in so far as this allowance in lieu of debt is concerned. I need only remark ffiat if no readjustment is to be made in lieu of debt, as the right hon. leader of the opposition argued in 1908, and as the hon. member for St. Johu argues now, and as the now loyal opposition in 1908 distinct-

ly said to the province of Manitoba, in these words: ' We will not even discuss this question with you in regard to your allowance in lieu of debt-if that position is to be taken, it would mean that the province which came, in and opened its arms to confederation in its younger life, came in when its population was sparse, would be at a disadvantage and its tax-payers would be suffering a very decided wrong when its population had advanced out of proportion to that of the older provinces. No argument that is rooted in right, or fair-play can be advanced that this allowance in lieu of debt is part of the compact of confederation and would be subject to no readjustment at all.

In my judgment-I argue this from a conviction that it is right-the allowance in lieu of debt-that constituent of the subsidies by the Dominion to the provinces-is just as much and just as necessarily subject to readjustment as is the allowance in lieu of land'. That ie to say, that as the provinces increase in unequal degree and in unequal proportion in their population, a readjustment must necessarily be made on the basis of that increase, and that, I submit, can be fairly made as has been done in the past, by this parliament without conferences. The right hon. the leader of the opposition, and I think the hon. member for St. John (Mr. Pugsley), will recognize the truth of what I say when I say that the principle I now argue for, of a readjustment from time to time of the allowance in lieu of debt has been recognized by the House before, not once, but five times, without any reference to a conference with the provinces. The allowance to Manitoba itself, in lieu of debt has been increased in 1871, in 1873, and up to 1885. The allowance in lieu of debt has'been adjusted by this House from time to time as population advanced in unequal measure. And never, that I have heard, has objection been raised to it, because it was not preceded by a conference with the provinces. Why, that very Act of 1885, from which the hon. member for St. John (Mr. Pugsley), quoted, whereby the allowance to Manitoba was increased by a very substantial amount at that time; was not preceded1, so far as I have been able to find out, by any conference with the provinces. If the present Bill is in any way a violation of an infringement of the compact of confederation, the Act of 1885, was certainly the same. The Act of 1885, purported to put the subsidy to be granted to Manitoba on a footing that would, up to that time, do justice to the province of Manitoba. The government of the day thought that justice to Manitoba was not being done by virtue of the tremendous increase that Manitoba's population had undergone, and the larger share 137

she bore of the obligations of Canada, and the parliament in 1885, finding that to be the case, thought it would do justice to Manitoba. All that is asked at the present time is that this parliament of 1912, should do the same justice to that province.

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
Permalink
LIB

William Pugsley

Liberal

Mr. PUGSLEY.

In 1885, was it not simply a proportionate increase among all the provinces, Manitoba included?

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
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CON

Arthur Meighen

Conservative (1867-1942)

Mr. MEIGHEN.

The Act I read, and I am sure it is correct, is an Act respecting Manitoba alone, and the Act is headed: An Act to Increase the Subsidy to Manitoba and1 adjust- all claims up to date.

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
Permalink
LIB

Frank Broadstreet Carvell

Liberal

Mr. CARVELL.

Was not that in 1884 and not 1885?

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
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CON

Arthur Meighen

Conservative (1867-1942)

Mr. MEIGHEN.

The hon. gentleman (Mr. Pugsley) told me it was in 1885.

Topic:   SUPPLY OF CEMENT TO DEPARTMENT OF RAILWAYS AND CANALS.
Subtopic:   EXTENSION OF BOUNDARIES- MANITOBA.
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March 4, 1912