It commenced with $250,000, and the amount was increased in later years. The amount was charged up just as any other expenditure, but in suspense, and the surplus, if any, would be lessened by the amount of that charge. Had my hon. friend charged up the $300,000, or whatever sum he proposes to charge up on the year's operation, his surplus would have been reduced; or, if he proposed to apply more than $300,000, then he would have shown a deficit instead of a surplus.
There has been a statute providing that any excess shall be used for the purpose oi the railway instead of passing into the consolidated revenue fund. Is it in relation to that that he is speaking? I ask for information.
The statute was not passed in the first place, it was inaugurated iby Order in Council; but within the last few years, I think, during the regime of my hon. friend from South Renfrew (Mr. Graham), the statute was passed. The
effect is that no matter what sum stood to the credit of the Intercolonial railway as a surplus at the end of the year should be applied to the interests of the railway, and not go into the consolidated revenue fund.
May I ask is it not the fact that each month a certain amount is charged up to the working expense of the road and credited to this special fund-say at the rate of $300,000 a year-and then at the end of the year, if there is any further surplus, it is also added to this special fund, and the total amount is expended on new equipment?
done when the hon. gentleman was Minister of Railways and Canals, or was a certain amount charged to be laid aside for new equipment, and then if there was a further surplus that also was transferred to the same account and used in the same way?
The work was actually done and it was paid for; the money went into the operating expenses of the railway, and if at the end of the year the amount which we had allowed for that purpose was more than made up by the surplus, we credited it to the same account and then we showed a surplus if we could. But my hon. friend adopts a different method. Were he to charge up this amount, there would be no surplus of earnings. I hold that any surplus that is shown by reason of the non-charging of these necessary items of expenditure to current account is a false surplus and does not properly show the real condition of the railway. If he intends to apply to equipment only a sum equal to this so-called surplus, then he has secured an equilibrium of expenditure and revenue, and upon that he is to be commended, and we congratulate him.
So much with regard to the financial condition of the railway. There has been adopted in connection with the management of the Intercolonial a new policy-an innovation in the affairs of that railway
which has proved to be not only detrimental to the railway itself but also very much against the interests of its patrons. I have said that I thought that the management was detrimental to the successful and satisfactory operation of the railway and the interests of the people. Let me say that in not proceeding with the branch line policy which was promised by my right hon. friend when he was in opposition, the interests of the Intercolonial have been very materially interfered with. I know that when we ask hon. gentlemen: do you purpose purchasing or acquiring by lease or otherwise these branch lines? the answer given is: no, the Senate intervened. In what way did the Senate intervene? It would seem to me that my right hon. friend and the Minister of Finance, who is not now in his seat, considered that the Senate did them a very great service when they did not pass that Bill without amendment. I submit that the Senate did not carve the Bill so that no further action could be taken. They simply proposed an amendment whereby the Department of Railways and Canals would be compelled to place before Parliament any contract or any arrangement which they made in respect to any particular railway. Does that prevent them from going on? It can be recalled that branch lines have been acquired in the past for the Intercolonial. In these cases, was any special legislation secured before the action was taken? I recall the fact that the Canada Eastern railway in New Brunswick was acquired in the interests of the Intercolonial and in the interests of the people; it was acquired by contract which was submitted to Parliament, after which the arrangement was carried out. If the present Administration were desirous of acquiring any of the branch lines connected with the Intercolonial they could have done it without regard to the action of the Senate and without regard to any legislation. I want to make this statement to my right hon. friend and to the acting Minister of Railways: arrangements have been tentatively entered into between certain of the branch lines railway companies and the Intercolonial Railway Company whereby these railways may, upon certain terms, be acquired. If I am not correct in that statement, I desire to be corrected. Such arrangements were made; why have they not been carried out? Why has not the New Brunswick and Prince Edward Island railway, running between Sackville, in the county of Westmorland, and Cape Tormentine,
and connecting the Intercolonial railway with w'ater communication with Prince Edward Island; why has that railway not been acquired? An arrangement was agreed upon whereby, in my judgment, it could have been reasonably secured in the interests of the Intercolonial and in the interests of the people. Nothing, however, has been done, and when any member or any supporter of the Government goes into the county of Westmorland, instead of frankly telling the people that the Government could have done this; that the Government could have carried this through without the legislation that was proposed to be amended by the Senate, he says: Oh, we could not go on with it because the Senate killed the Bill. Mr. Speaker, that is not so. The Senate did not kill the Bill relating to branch line railways; they merely suggested a very reasonable amendment, and I think the Government and the management of the Intercolonial stand convicted for not carrying out that policy with respect to these branch lines. 1 shall not give further illustrations; they are in existence and they could be cited, but I say that the Government in not securing these branch lines are doing not only an injury to the Intercolonial railway itself, but they are doing also a grave injury to the trade and commerce of the country. They are materially obstructing the interests of Prince Edward Island; they are injuring the coal interests of Nova Scotia; they are injuring the fishing and quarrying interests of New Brunswick; they are impeding the development and progress of eastern Canada by their inaction in connection with this matter. I say that it is a matter of serious impeachment against the Government that they have been so inactive. The truth is that the present Minister of Railways-I am not referring to my hon. friend the aeting minister-the present Minister of Railways, who is now absent, is entirely opposed to the acquisition of any branch lines connected with the Intercolonial railway. He has argued against them; he has called them not feeders but milkers; he has spoken of them derisively and contemptuously. So far as his utterances, confirmed by his actions, are concerned, certainly he stands as being entirely opposed to the carrying out of the branch lines policy which was promised by my right hon. friend, when he was leader of the Opposition, during the elections of 1911.
The service on the Intercolonial has never been at such a low ebb as it has been during the past season. It has been deteriorating. Take the train service between Montreal, Halifax and the Sydneys; during the past year and a half or two years the service has been deteriorated to a degree that cannot well be described. Whether in the matter of accommodation, the matter of parlour-car or dining-car service; in whatever way you speak of it, it has deteriorated. The road-bed has not, I think, been maintained at the proper standard. Yet the revenues of the railway have grown year by year; where a few years ago we had $8,000,000 or $9,000,000 of a revenue, to-day we have between $12,000,000 and $13,000,000. I maintain that during the present year the standard of our gross earnings would have been kept up had the service been commensurate with the requirements of the country. To my mind, the cutting off of the Ocean Limited was one of the most injurious things that has been done in connection with the railway in many years. It diverted and cut off the traffic that was growing year by year. During the last and preceding years, when we had in operation over the Intercolonial the Ocean Limited and the Maritime Express, eighty per cent of the westbound traffic went over the whole of the Intercolonial to Montreal, and only twenty or twenty-five per cent went over the Canadian Pacific railway from St. John.
Is it not a fact that during every year except the year 1913 the Ocean Limited did not run during the months of February .and March, and that during the present year it was off only during February and March, as in the previous years, except 1913?
My hon. friend is absolutely correct. When the Ocean Limited was first initiated it was intended only as a tourist train and ran fo
success, and as it was successful the management continued it. in operation until finally they ran it throughout the season, a wise course to be adopted. But what happened? When it was run only as a summer train the traffic was diverted during the winter months over the Canadian Pacific railway, and a large percentage of it, so far as my observation teaches me, continued to be diverted throughout the summer months, even after the Ocean Limited had been restored. But it grew, and the fact of that train being in operation on the Intercolonial explains very much as regards the increased gross passenger earnings on the Intercolonial. And I say that it was rotten policy, it was against the interests of the railway, and it was playing into the hands of the Canadian Pacific railway to discontinue that train last winter when it had been so successful, comparatively speaking, the previous winter. .
My hon. friend may have these figures, I have not. If its operation during those months did result in a direct loss, I say that indirectly it would have been a gain to the Intercolonial railway to have continued it. Many trains, the suburban trains in which my hon. friends are interested, are not successful in isolated cases, but will any railway management say that it is not in the general interest of railways to run certain trains at a loss when in the main the advantage to the railway may be demonstrated?
It may have, I am not in a position to answer my hon. friend. I do not know. But even at such a loss, if it had been continued it would have been more than made up by the increased continuance of travel during the remainder of the year. We all know that travel is easily diverted. We aTe creatures of habit, individually and collectively. We get into a habit of going by a certain route and we continue to go there. Suddenly there is no opportunity of following the course we have always pursued and we become accustomed to some other route. Naturally we continue the diversion and so it is with respect to the
Ocean Limited. I believe that the continuance of that train over the Intercolonial railway has contributed as much as any other agency to the growth of the earning power of the Intercolonial railway. I think it has advertised the Intercolonial throughout America in a way that no other train has done in past history, and I believe that it is a penny-wise and pound-foolish policy for the Intercolonial railway, because of the loss that might be entailed during certain months of the year, to discontinue that train. When there was only one train over the Intercolonial railway from Halifax to Montreal, the Canadian Pacific railway had a practical monopoly or a large proportion of the traffic between those two points, and for very obvious reasons, one being the time of departure from Montreal. When this second train was put on over the Intercolonial railway, in 1905 or 1906, there was a great change in this respect. I asked the department for certain information respecting the percentage of westbound traffic over the respective trains and I was furnished with this information:
Year. Via Intercolonial. Via St. John. No. of passengers. Per cent. No. of passengers. Per cent.1910 9,077 69 G 3,968 30'41911 9,300 69'7 4,034 30'31912 11,206 73' 4,108 27'1913 12,674 80' 3,113 20'
This shows that when the Intercolonial railway operated the Ocean Limited all the year round the traffic over that line from east to west was steadily increasing and the percentage of passenger traffic over the Canadian Pacific railway from east to west was steadily decreasing.
The foregoing are from returns compiled in the office of the general passenger agent and for his information, not for accounting purposes. Corresponding figures are not available for the eastbound traffic, but usually the movement in the two directions about balance.
That demonstrates this fact: when you have two through expresses between Montreal and Halifax, running continuously throughout the year, your traffic is expanding and increasing, and it is to the advantage of the Intercolonial that those results should be brought about,
I now come to the second point. I hold that the interests of the Intercolonial are being made subsidiary and subservient to the Canadian Pacific, the other competitive railway; and that the patrons of the Government railway system are being discriminated against by the diversion of the legitimate traffic of that railway. The rates on the Intercolonial have increased very materially in the past few years. They are turning the screw at every point.
I have a return here with respect to the freight charges on hay from points in Quebec eastward, and I find that the increases are in many cases as high as a dollar a ton, or from $30 to $40 a car. In some instances they are half that, and in some cases even less than that. The rates range from one to five cents a pound for hay. The Intercolonial service has been degraded, and the charges to the general public have been increased. I do not say that with respect to passenger traffic-yet,
I do, because whereas in the past certain privileges were accorded to the patrons of the railway in the way of excursion and holiday rates, these have been withdrawn and the patrons are now compelled to pay the regular rates. The revenues necessarily have been increased by reason of the increased freight and passenger rates, but I hold that the service has not been commensurate. We have brought to the railway some very high-priced officials: Mr. Gutelius for one. He gets $20,000 a year, and we have another gentleman who gets $12,000. On the engineering staff of the. Intercolonial to-day, there are twenty-seven engineers, where six years ago there were only four or five to do the whole work. We have engineers of almost every conceivable name; and not only engineers, but assistant engineers, and in the main they come from the Canadian Pacific railway. The manager, himself, comes from there. Canadian Pacific Railway officials are replacing Intercolonial officials, who have the proper qualifications, and have had experience on that railway. These new officials are making the Intercolonial subservient to the Canadian Pacific railway. Even the very forms that are in use in the offices and railway stations have been changed to conform to the Canadian Pacific's forms. The standard rules of the Canadian Pacific railway were adopted on the Intercolonial on the first of May. The men who have been long in the service, who have safely operated the trains under certain rules, and to a degree
that accidents on that railway compare favourably with the accidents on any other railway on this continent-and particularly with the Canadian Pacific railway, which is held up to us as a model of operation and safety, hut which according to the statistical returns of the Government of Canada has a larger proportion of accidents than the Intercolonial-are expected within a few months to become familiar with the standard rules of the Canadian Pacific railway. Let me say that there are 673 rules; rules upon which depend the safety of the lives of the passengers and trainmen. In a few months the old men, from 50 to 65 years of age are expected to become familiar with these 673 rules, and at the same time to continue running the trains under the old rules. The confusion that has resulted can be imagined. The men on the Intercolonial have been protesting in regard to this matter. When the Boston and Maine Railway system changed their rules they allowed two years for the new rules to be put in operation. The Government of Canada allows only two or three months, which will result, in my judgment, to the injury of the railway, of its employees, and of the passengers who travel on that line. The Intercolonial railway has been made subservient to the Canadian Pacific railway in connection with the Gutelius-Bosworth agreement. I have referred to this matter before and shall not now go into it in detail, but let me say that it is an agreement entered into without the authority of law, in my judgment, and without the approval of an Order in Council, whereby the Intercolonial carries a train of 400 to 500 tons from St. John to Halifax for $300, and agrees to bring back the cars to St. John free of charge; and not only that, but to pay the Canadian Pacific railway for the use of the cars which have been attached to that train. The answer has been made that it pays the Intercolonial to do it. I have a return before me showing clearly that it costs the Intercolonial at the very least .56 or over half a cent to transport freight per ton mile. That was the average cost during the months of April, May and June, 1913. That means that it costs $2.24 to carry 400 tons one mile. The distance between St. John and Halifax is 275 miles. A special freight +,'3ln- under the agreement consists of oOO tons eastbound and 400 tons westbound. Special passenger tra:r= aT? limited
to twelve oars including the vans, which, of course, are governed by weather conditions. That is the contention of the Intercolonial railway. I understand that the Canadian Pacific railway contend that the arrangement includes the carriage of a greater tonnage. But assuming it to be 400 tons, it costs the Intercolonial railway $616 to transport those 400 tons from St. John to Halifax for which it receives $300, taking the return of the Intercolonial itself in respect to the cost of transporting freight.
I assume that includes all the charges because the statement is headed 'Intercolonial Railway; cost of transporting freight per ton mile, April, May and June, 1913, and April, May and June, 1912.' The items are given in the statement and show the cost per ton mile in 1913, to be -56 while in 1912 the cost per ton mile was only -50. In the month of June, 1913, it was -67.