June 7, 1905 (10th Parliament, 1st Session)


William Stevens Fielding (Minister of Finance and Receiver General)



live government gave the Canadian Pacific Hallway 25,000,000 acres of land which is untaxable for all time to come, a concession that is wrong, I do not care who did it. The present government gave concessions in the Yukon to different parties-although I hope not for all time to come-which have proved a curse to that country and will always he a curse to it until they are removed. This fact was so impressed on the government that they appointed a Royal Commission to investigate that question and with your permission I shall refer [DOT] you and the House and the country to what Judge Britton found when he went to the Yukon. Under the heading :
Hydraulic leases attacked.
Judge Britton enumerates the following concessions :
1. Lease No. 9, comprising a tract of land situate between Adams creek and Fox gulch, on the left limit of Bonanza creek, having a frontage of 1J miles, issued in favour of C. A. Mats'll and associates, and known as the Matson concession.
Right in the very heart of the richest gold-bearing district in the world.
2. Leases Nos. 2 and 8, comprising a tract of land situate between Boulder creek and Fox gulch, on the left limit of Bonanza creek, having a frontage of 55 claims, issued in favour of J. J. Doyle and associates, and known as the Doyle concession.
3. Lease No. 5, comprising a tract of land commencing 24 miles from the mouth of Bonanza creek and extending up that stream for a like distance, issued in favour of the Hon. E. H. Bronson and 'C. C. Ray, and known as the Bronson and Ray concession.
These gentlemen live here in Ottawa.
4. Lease No. 18, comprising a tract of land commencing about li miles from the mouth of the Klondike river, thence up stream for a distance of 6'72 miles, issued in favour cf M. J. Boyle, and known as the Boyle concession.
5. Lease No. 10, comprising a tract of land situate on Quartz creek, a tributary of the Indian river, in the Yukon Territory, having a frontage of 3J miles, and known as the Quartz creek concession.
6. Lease No. 1, comprising a tract of land, situate on Hunker creek, below the mouth of Last Chance, having a frontage of 2J miles, and known as the Anderson concession.
7. Lease No. 33, comprising a tract of land, situate on Gold Bottom creek, a tributary of Hunker creek, issued in favour of C. J. Hermann, and known as the Hermann concession.
8. Lease No. 30, comprising a tract of land, commencing at the mouth of Miller creek, -a tributary of Sixty-mile river, and extending up stream a distance of 3'38 miles, issued in favour of the North American Transportation and Trading Company, and known as the Miller creek concession.
He says:
There have been granted, in all, since the opening of the Yukon Territory, 40 hydraulic leases. Of these 13 have been cancelled, and 27 are standing. Of the 27. 8 have been at- 1 Mr. THOMPSON.
tacked. Only 2 others were mentioned as likely to be attacked, and no one interested took the trouble within the time given, to formally lodge any complaint as to those.
He discusses the various concessions and refers to the mining regulations and proceeds :
The matter was treated in the larger way, ignoring placer claims when they formed a small part compared with the large quantity of gravel ground which it was alleged could be worked only by hydraulic methods. There certainly wyas not, in the earlier days after the opening of the territory, sufficient care on the part of the officials in the territory to see that the regulations were strictly complied with It will be seen by a perusal of the lease that the conditions are exacting and carefully drawn, with the manifest intention of protecting every interest connected with the mining Industry. Under these circumstances, it has apparently been thought best to accept as representation work, work done by placer methods instead of insisting upon work by hydraulic methods.
Now, there is the gist of the question. These are so-called hydraulic leases. They should be worked and worked alone by hydraulic methods, but there is not to-day in the Yukon a single one of these concessions operating by hydraulic methods, and the government, as the judge points out here very clearly, has seen fit to accept work done by ordinary placer methods as work done by hydraulic methods. What is the difference ? The difference is this : A man gets forty or fifty acres of mining land in a concession on which he does .$5,000 worth of work. I will work a placer claim of 250 feet beside him and I have to do a great deal more work than he has to do in proportion and he has many privileges that 1 have not. It is not these concessionaries who have given us all this gold. I venture to say that they have given us only a very small proportion of the product of the Yukon. The small individual miner is the man who has produced this gold and he is the man from whom these leases have taken ground right in the very heart of the richest areas in the Yukon. Judge Britton condemns that practice. Unfortunately there are terms in most of these leases whereby a double construction can be given to them. They may be construed to mean that the concessionaries do not absolutely have to work by hydraulic methods, and that is the loophole through which the concessionaire has always crawled. He says further :
All these questions are beyond the scope of my commission as affecting the rights of parties respecting any particular concession, but are of Importance for the consideration of tho department upon the question of beneht or injury to the mining industry of the territory.
Here is this pregnant sentence :
The fact of these large concessions existing no doubt has a bad moral effect.
Why ? He discusses that.

A miner, on the 'look out for a placer location, makes a discovery, and upon application, finds that his ground is not open, because it is within the territorial limits of a concession. This annoys him, and he spreads what he calls his grievance far and wide, creating dissatisfaction among miners. Others, without attempting to prospect or locate, say they cannot, because all the ground is covered by concessions, and men who never were and never intended to be miners join in the cry against concessions.
That is his opinion : Then he offers some suggestions :
In reference to the benefit or injury of hydraulic concessions, I think it proper to make the following suggestions :
Here they are :
That placer work or ' preparation ' work should not be accepted in lieu of -what can properly be called hydraulic work, or hydraulic operations. An annual expenditure of $5,000 is very small for such large areas. If the conditions are not complied with, the lease should be cancelled.
Here is another important point:
The regulations define the width of an hydraulic mining location as one mile, but where it is situated in a valley, the location may extend in width to the ' limits of the valley,' if so ordered hy the minister.
They may extend these limits to the limit of the valley.
A very liberal 'construction has been placed upon the expression ' limits of the valley,' as it has been held to mean from * summit to summit '

These valleys are 400 to 500 feet deep with mountains and hills on each side of them :
-as it has been held to mean from ' summit to summit ' of the watershed on either side. I think that too wide, wider than the regulations were intended to authorize. Such locations should not extend beyond the summit of the first or lower hill on either side. It is too much to say that ' limits of the valley,' in defining a location, should include a succession of hills and valleys between, leading up to the summit of the watershed. The regulations should be amended.
He proceeds :
These hydraulic concessions would be more beneficial to the mining territory if they were considerably smaller

They cover acres and acres and miles.
-or the conditions should require a much larger annual expenditure than $5,000.
In coming to the conclusion mentioned before, that in certain cases lessees had complied with the conditions of their leases, I did so because it was proper to consider, and I was bound to consider, the interpretation which the department had placed upon ' representation work ' upon all the hydraulic concessions.
Now, just in regard to this question 1 would like to show very briefly a very small section of the argument which was submitted to Judge Britton, and which, I suppose, influenced him somewhat in making up his mind. I will not read it all. It was by the advocates who presented the case of the board of trade before the commission. This statement shows how many miles are included in a concession, how many placer claims would he worked in case these concessions were thrown open, and how much revenue the government would get from this ground from which now they practically derive no revenue. It says :
If the above estimate is correct the government would receive in entry fees when concessions are thrown open $23,000 ; 5,130 men would be given employment, and calculating gold at $15 per ounce, $9,618,750 would be produced on which the export tax at pressnt levied would be $240,468.87. If these same men chose to buy imported goods for themselves and families it may be fairly estimated that each would pay $100 into the customs, making $513,000 more. The revenue to the government in renewing 1,215 claims at $12 each would be $14,580, while the claims restaked would be 542, bringing $5,420. With an adequate water supply on fair terms these estimates are too low. But summarized they stand thus :
Pees receivable by government on opening above concessions $ 23,000
Pees on claims renewed at end of first
year 14,580
Fees on claims restaked at end of year 5,420
Export tax 240,468
Customs (subject to 75 par cent reduction on account of consumption of Canadian goods) 513,000
Total revenue receivable at end of first
year *[DOT] 773,468
Reduction on account of use of Canadian goods 384,750
Actual revenue receivable at end of year 388,718
These figures are the opinions of the gentleman who argued the case for the board of trade before Judge Britton's Commission and they may not be absolutely correct, but they have in them a very large grain of truth.
This, Mr. Speaker, is no party question. I will refer very briefly once more to the platform of my predecessor, the Hon. Mr. Ross, and I find that the platform he ran upon and the platform he was elected upon contains this plank :
Resolved, That a policy should be adopted which would prevent the obtaining of concessions for hydraulicing, except in places wbere the dirt is of such low grade that it could not profitably be worked by other methods, and that before any hydraulic lease should issue, notice should be given by the applicant by publication in the newspapers of his intention of applying for such lease, so as to enable protests to be entered against the granting of the same ; and that the ow-ners of hydraulic concessions already granted should he compelled to carry out the strict terms of their leases, and that in default of their so doing their leases should be cancelled.
That is what Judge Britton says also. This was a plank in the platform of the Hon.

Mr. Ross when he was elected by the Yukon people to represent them in this House : and my own views are even stronger. This land, in the very heart of our gold bearing district is locked up ; the government gets no revenue out of it, the people get no employment, and the men who own these concessions play the part of the absentee landlord in Ireland. They do not reside there ; they reside in Ottawa or somewhere else. Messrs. Bronson and Rae live ir. Ottawa, they hold thousands of acres which do not produce a dollar, and they have not employed labour in the past commensurate with the acreage -which they have. There is nothing to be gained by the government or the people from having these leases perpetuated. The system is wrong. Make these men carry out the terms of then-leases, or throw the ground open. If the government are legally bound to these men, and must stand by the contract, then they should require them to work the ground hydraulically, so that there will be no doubt that labour is being employed and that the gold is being taken out of the gravel. But now nothing is doing. These leases are lying there dormant. I suppose the rent Is paid and the representation work amounting to $5,000 a year, is done to the satisfaction of the government. But the thing is wrong ; these men should not be there at all. This ground is in the heart of our gold-bearing district, and if they had not possession of it, the miners wotild have a chance of prospecting it and taking it up if they found that it was good enough. This question of concessions is affecting the Yukon Territory, I believe, more than anything else. It has . damped the ardour of the people there. They find it difficult to go on and prospect with these blankets covering the territory. The concessions may be worth nothing, or they may be worth millions of money. We do not know what they are worth, simply because we cannot prospect them.
In almost every other 'country where there are placer mines, in every country that I know of except the Yukon, quartz mining is carried on. At the present time no gold is being won from quartz in the Y'ukon, although there are many prospects, and one mill is ready for operation. People have found it difficult to interest capital in the quartz mining of the Yukon. If to-day we had a population deriving their livelihood from that industry, hon. gentlemen can understand what a difference it would make in the stability of that country. Placer mining is more or less unstable, while quartz mining is stable. The man engaged in quartz mining invests his money for years, and the people interested in it would be glad if the government could assist them in some way, such as allowing their machinery to come in free, as some of the mills they require are made in the United States. When mills of the same kind are made in Mr. THOMPSON.
Canada, they cannot be brought in duty free; but the mills made in the United States are in some instances better suited for tbe class of ore we have in the Yukon than the mills made in Canada, and our miners would like to be able to bring these in duty free. This is a reasonable proposition. It would not cost the government any money : it might cost the Canadian manufacturer the sale of a mill or two, hut it would give an impetus to the quartz-mining industry of the Yukon. While on this question of bringing in mills duty free. I might refer to another industry which has just been started there, that is, the dredging industry. Dredges are also made in Canada, but as a Canadian it humiliates me to have to admit that better dredges for the Yukon are made in the United States, for some unaccountable reason, whether because they have a larger market or not. In the Yukon we are just on the eve of a great dredging era, and I submit for the consideration of tbe government that they .should remit for a term of years the duty upon mills and dredges made in the United States, which are more suitable for work in the Yukon than those made in Canada. If the government would do this, it would give a great impetus to the quartz mining and dredging industries of the Yukon. It would be also for the benefit of Canada as a whole, because Canada has no better customer to day than the Yukon. We produce nothing but gold. Every man,' woman and child there has to be fed and clothed, and Canada supplies 80 per cent of our food and clothes. In passing, I may say that, though we are not producing a dollar from quartz mining, the export duty on gold applies to it as well as to placer gold ; so that while the government are not getting a dollar of revenue from that tax, it militates against the investment of capital in quartz mining. That is another matter which I submitted to the Prime Minister, and he saw the force of the argument, and had that tax remitted for ten years. All these things the people oi the Yukon appreciate.
Another question to which I wish to refer is the importation of liquor into the Yukon There does not seem to be any reason why the people of the Yukon should have to pay $2 a gallon on Canadian whisky brought in there, when it can be sent to Nova Scotia without the payment of a cent. This is another matter which should be brought to the attention of the government. We are Canadians as well as you in other parts of this country, and there is no reason why we should be compelled to pay an extra duty on that article-and we use a fair quantity of it. While we use Scotch and Irish whisky, the great bulk of the whisky consumed is Canadian rye ; and we feel it to be a grievance that we have to pay an extia $2 a gallon on that, while the people of Nova Scotia and the people of British Columbia do not pay anything.


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