April 1, 1924

CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

I think they are. I refer, for example, to the Grand Trunk Pacific bonds guaranteed by the Grand Trunk, and, as well, to the Canadian Northern income convertibles guaranteed conditionally. No interest is being paid on them, and we are not liable for such interest.

Topic:   CANADIAN NATIONAL RAILWAYS
Subtopic:   BILLS PROPOSED TO AUTHORIZE THE CONSTRUCTION OF BRANCH LINES
Permalink
LIB

Herbert Meredith Marler

Liberal

Mr. MARLER:

Bonds of the Grand Trunk Pacific guaranteed by the Grand Trunk are included in the statement.

Topic:   CANADIAN NATIONAL RAILWAYS
Subtopic:   BILLS PROPOSED TO AUTHORIZE THE CONSTRUCTION OF BRANCH LINES
Permalink
CON

Arthur Meighen (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. MEIGHEN:

And the income convertibles?

Topic:   CANADIAN NATIONAL RAILWAYS
Subtopic:   BILLS PROPOSED TO AUTHORIZE THE CONSTRUCTION OF BRANCH LINES
Permalink
LIB

Herbert Meredith Marler

Liberal

Mr. MARLER:

As to the income convertibles, I am not prepared to answer my right hon. friend at the moment. I could do so if I delayed to look up the figures here, but I presume the matter is not of sufficient importance at the moment for me to do so. Now, Mr. Speaker, the government is asking for a vote of $56,000,000 for the ordinary railway loans. In that sum there is, not included, of course, this additional $28,000,000. Last year we were asked for something like $74,550,000, or about $18,000,000 more than this year. This represents the gain in operating earnings of the Canadian National Railways, and possibly it may be said that in view of this gain we are justified in branching out and spending more money on our railway system, but I do not think there is any justification for this view. It would seem to me very absurd and most unreasonable that after spending something like $390,000,000 on these roads during the last three years alone there should not have been a very distinct improvement in the railway earnings, and for that reason I do not think we should be exuberant in praise or too generous in our attitude with regard to the

Topic:   CANADIAN NATIONAL RAILWAYS
Subtopic:   BILLS PROPOSED TO AUTHORIZE THE CONSTRUCTION OF BRANCH LINES
Permalink

REVISED


spending of money on the building of branch lines, except, as I have stated, where they are absolutely essential. In these operating deficits or in the operating surpluses, as the case may be, the actual interest payable to the government of Canada is not included or taken into consideration, to say nothing about the interest on the capital amounts which has been paid and which has been placed in the system. These fixed charges are continuing and are increasing materially every year. For example, in 1920 the fixed charges due the Dominion were $13,000,000. In 1921 they had increased to $19,000,000; in 1922 they were $24,000,000 and in 1923 they were $29,000,000. In other words, the amount of money payable on loans made and on indebtedness to the Dominion of Canada, not including operating deficits or earnings, was $29,000,000 on the 31st of December last. There is another point that I think we should take into consideration: we are wont in this House to say, "Let us keep the railways out of politics;" or, "The board of directors say we should do this or should do that." I do not think we can hide behind statements of that kind. We have to accept our own responsibility in this House for the money we spend on branch lines or on any other part of the railway system. So far as I am concerned, I am not going to hide behind the cry that the railways should be kept out of politics or that the board of directors say this or say that. I want to know myself what the expenditure is to be before I share any responsibility in the matter. In addition to that, we shall probably be told that the budget will balance this year. I am not uttering criticisms, Mr. Speaker, in this respect; I am simply stating cold facts. Twenty-eight millions is a huge sum of money and should not, either in whole or in part, be voted in this House until we know precisely what we are doing. It may be argued that on account of the budget being balanced we should branch out still more, but in my opinion that is no reason at all. I am glad to know that the budget is likely to balance, but if it does it will be because we have too great war taxes on the country, the surpluses from which are being used for other purposes, not war at all. If there is a surplus of war taxes-and I know there is -then those war taxes should be remitted, cancelled or reduced. We are very likely to be told as regards these branch lines that in view of the reduction in the estimates we should proceed with


EDITION


8&8 C.N.R.-Branch Lines



the proposed construction. I know there has been a very considerable reduction in the estimates and I commend the government for it. That reduction, exclusive of railway expenditure, amounts to 127,000,000, of which probably $10,000,000 is due to the slackening off of war services. In other words it is due to the fact that those war services have slackened off in the ordinary course of events and have not been specially diminished in any way-services which are paid, Mr. Speaker, with war taxes. That means that there is a reduction in the estimates this year of $17,000,000, and that reduction will be not as great when the supplementaries come down. Therefore I submit that the fact that there is a reduction in the estimates is no reason at all why we should build branch lines and more railways. These resolutions are brought down at this time of the session, and before the budget, no doubt for certain very good reasons. They are brought down, I suppose, at this particular season of the year in order that the engineers may get to work on their estimates, get their plant on the ground and start the construction, in accordance with any vote passed by this House and by the other House, in ample time during the coming summer. That is sense, there is no doubt about that; it is a good season for the measures being brought down at this time. But notwithstanding that, it seems to me that we are entitled to know exactly how our budget is going to stand for the next year before we vote $28,000,000. Business at present is not satisfied, particularly in view of the heavy taxes that are being paid. Many say that business is prosperous, but I am of the opinion that it is not as prosperous as many seem to think. Business wants to know how we are going to stand for the next fiscal year before undertaking a measure of this kind. It was indicated by certain proposals of the government that there might be changes in the tariff, and cities in particular have been very much disturbed as to what those changes might be. I do not know what the actual proposals are; nobody knows what they are; but business is very distinctly disturbed in that connection, and I venture to say that if proposals are brought down which will injure business interests or will not improve business interests, -which without doubt need improvement at the present time, certain parts of this country will not agree to the building of any of these lines. We want to know before expending money exactly where we stand, and I think we are entitled to know before voting this large sum precisely what is the fiscal policy of the government. Without discussing any particular branch lines, I wish to say that I have taken the opportunity^ of studying, by the 4 p.m. map and by such information as I have been able to procure, the various lines which are projected. Some of these lines, it is alleged, should be built because certain grading has already been done. It is urged, not by the minister but by others, that for this reason we should put rails on these gradings and complete them into railways. But in my opinion the fact that these gradings exist is no reason whatever for taking that course. If we have spent money on the grading of these lines and if it has been unwise to proceed further, the mere fact-I repeat, the mere fact; I do not want hon. members to misunderstand me- that these lines are graded and that money has been spent op the grading is no reason why millions more should be spent in turning them into profitless branch line railways. In addition to that, so far as I can see, pome of these lines are too near other existing lines and therefore are not essential. In other cases there is too little population to serve and there is not likely to be any additional population in these particular localities for some considerable time. In other cases I believe traffic arrangements could be made with other railway companies which would obviate the building of additional lines. In other cases I can find no reason whatever why the projected lines should be built, and I doubt if any railway engineer could find any. In that connection, Sir, I may point out that we have millions of acres near railways which we can use without spending enormous sums for the building of lines into sparsely populated territory. In conclusion, as regards the remarks which I have been making I want to say this-and it has reference to a fact which, I think, is not fully understood or fully grasped-we have in this country at present two great railway systems, the Canadian National and the Canadian Pacific. I think every member of this House, I think everybody in this country, should wish well for both these lines, they are both great national undertakings. But to say that the Canadian National system should progress because of unfair competition with the Canadian Pacific line is senseless in the extreme. The Canadian Pacific is just as great a national asset as the Canadian National line. In addition to that, the Canadian Pacific is known C.N.R.-Branch Lines all over the world by reason of its stability in management and in finance and is, as a matter of fact, all hon. members will admit, a source of pride to this country. The Canadian Pacific is financed by its own efforts on its own credit and on its own ability, whereas all the Canadian National railway line has to do is to to come to this House and get money, and it usually gets the money it requires. Now, to have competition between these two lines is senseless in the extreme. If traffic arrangements can be made with one line to help out another line, I think those arrangements should be made. To build lines unnecessarily when there is not enough traffic to satisfy both these systems is not putting this House, is not putting this country, in a position to get lower freight rates in the very slightest degree. What we need in this country and what we must all try to get is lower transportation costs. That is what we want. Building branch railway lines may yield pleasure but that is not going to give us lower transportation costs if other railway lines are there to serve the particular purpose which the proposed new lines are intended to serve. I wish to make that point abundantly and absolutely clear in every respect, and I particularly wish to repeat- that where it is possible to make traffic arrangements with another railway these branch lines, as suggested, should not be constructed simply for the purpose of building them. In addition there is a great deal of duplication of services in this country between these two railways. I believe traffic arrangements could be made between the two systems that would be most satisfactory. Why should not such traffic arrangements be made, why should not such duplication be avoided? Why should not such duplication be remedied with a view to bringing the operating costs of both systems down to a minimum and making their operating and general profits greater? so that in course of time we shall be prepared to demand lower transportation costs. That is what we must have in mind in connection with these proposals brought down by the minister. The object should be not to build further railways, not to spend money unnecessarily, but to get lower transportation costs and see that both these great railway companies shall survive and prosper. Now, Mr. Speaker, I will take my seat merely adding these few words. When these bills are brought down I shall expect the fullest information from the minister- and and this no doubt he will give in his usual admirable manner. I shall want to know how the expenditures are to be met and what reasons there are for building these different branch lines before I will support the proposals.


LIB
LIB

William F. Carroll

Liberal

Mr. CARROLL:

Has the hon. member

taken into consideration the St. Lawrence river improvements upon which this country is expending millions of dollars a year?

Topic:   EDITION
Permalink
LIB

Jean-Joseph Denis

Liberal

Mr. DENIS (Joliette):

I am quite ready

to admit that my hon. friend's argument has its

C.N.R.-Branch Lines

value but at present Lam dealing with railways. Now this resolution and the bill which will follow proposes that 965 miles of railway should be built at an expenditure of $28,311,300. Out of the 965 miles now being proposed Quebec will have 31 miles, with an expenditure of $1,462,000.

Topic:   EDITION
Permalink
CON

Charles-Philippe Beaubien

Conservative (1867-1942)

Mr. BEAUBIEN:

Is the hon. gentleman aware of the benefits the province of Quebec receives through its shipping ports from the extra branch lines and railroads in the western provinces?

Topic:   EDITION
Permalink
LIB

Jean-Joseph Denis

Liberal

Mr. DENIS (Joliette):

I am aware of all that, but this is another question altogether. I could not answer offhand a question like that. If I were to answer the question of my hon. friend I should have to go into details as to the cost of the railways and the improvements made in the St. Lawrence, and so forth, and this is a matter which is outside of the question I have been discussing. I shall be quite willing to hear my hon. friend discuss the question as to why further railways should be built in the West.

Topic:   EDITION
Permalink
CON

Charles-Philippe Beaubien

Conservative (1867-1942)

Mr. BEAUBIEN:

It would be very much better if my hon. friend had made a comparison of the railways constructed in the West as compared with those constructed in Quebec.

Topic:   EDITION
Permalink
LIB
PRO

Robert Gardiner

Progressive

Mr. GARDINER:

Has the hon. membei taken into consideration the fact that in Quebec last year there was expended for transportation 'purposes-harbours, rivers

and so forth-the sum of $1,137,650.50, as against an expenditure in Saskatchewan and Alberta of $34,000?

Topic:   EDITION
Permalink
LIB

Jean-Joseph Denis

Liberal

Mr. DENIS (Joliette):

Yes, I take that into consideration, and if you take into consideration the fact that the province of Quebec is paying for the railroads of the West-

Topic:   EDITION
Permalink
?

Some hon. MEMBERS:

Oh, oh.

Topic:   EDITION
Permalink
LIB

Jean-Joseph Denis

Liberal

Mr. DENIS (Joliette):

This is a fact

which will be proven on investigation, and there is no question about it. In answer to my hon. friend I say that this million and a half is just one drop in the bucket compared to what we are paying for railroads in the West. We have deficits of hundreds of millions of dollars on these railways that have

C.N.R.-Branch Lines

been built where they should not have been built.

Now let us make another comparison. In the United States they have one mile of railway for every four hundred inhabitants, in Canada we have one mile of railway for every two hundred inhabitants; and in Manitoba, Saskatchewan, Alberta and British Columbia they have one mile of railway for every one hundred inhabitants. These lines by the very nature of things must come out of the moneys of the country, and must increase the deficits, and the province of Quebec is paying for this.

Topic:   EDITION
Permalink

April 1, 1924