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Nova Scotia Legislative Assembly, 18 April 1865, Nova Scotia Confederation with Canada.

PARLIAMENTARY DEBATES. 273
TUESDAY, April 18th, 1865.
MR. MCFARLANE from the Committee on Agriculture reported. Some conversational debate took place on the subject of the importation of Stock.
MR. PARKER advocated the idea of having farms in different parts of the Province, for the raising of Stock. He also spoke of the want of a suitable Market House in Halifax for the convenience of Farmers.
The report was received and adopted.

THE CROWN LANDS IN CAPE BRETON

Mr. MCDONNEL referred to the question of the settlement of Crown Lands in Cape Breton which had been discussed in the early part of the session, and to the statement then made by Hon. Prov. Sec., and the hon. leader of the Opposition, to the effect that Cape Breton had been more highly favored than other parts of the Provinces as regards the terms upon which the payment of Crown Lands was to be made—inasmuch as long credit was given to purchasers in that Island, and the moneys amounting from the sale of these lands, were reserved for the opening up of roads.
He was rather surprised at the assertion at the time, and he was induced to look into the question, and ascertain how the facts really stood.- Upon referring to the law passed in 1859, for the settlement of Crown Lands in Cape Breton, he found it enacted that the money arising from the sale of these lands, was in the discretion of the Government to be appropriated to the opening up of the roads in the Island of Cape Breton. In order to follow the matter up, he asked the leader of the Government to lay upon the table & return all of the moneys derived from this source since the passage of the Act. From that return it appeared that there had been paid into the Re 274 PARLIAMENTARY DEBATES. ceiver General's office $9,467 from the County of Cape Breton, arising from the sale of Crown Lands, while the sum contributed by that county to the revenue of the Province, including amount of outstanding lands, amounts to $37,164, from Inverness $27,138, Richmond $16,476, Victoria $23,606.
And yet, would it be believed, that altho' it is five or six years since the law was put upon the Statute Book, there had not been a single cent of the money appropriated either by this or any previous Government for the purpose pointed out in the Act.
He had asked the Government for an advance of $8,000 which was absolutely required for the roads of the county he represented (lnverness) and altho' there had been actually paid into the Receiver General's Office, from that County since the passing of the Act, the sum of $10,153, which after deducting therefrom the cost of all surveys made in the County since the Act, leaves a balance at this day of $6,049 in the Treasury, yet the Government have refused to give a single cent for the purpose recommended in the Act.  He thought the House would agree with him that this was not right.  The Act referred to was passed by this Legislature—and that for the purpose referred to.  He could not suppose that it was in— tended that it should remain a nullity upon the Statute Book, and therefore desired to have it enforced. The hon. gentleman said he had risen for the purpose of contradicting the statements made in the early part of this Session by the hon. Prov. Secy. and the hon. leader of the Opposition now sent broadcast by the hon gentlemen over the Province, that Cape Breton enjoyed all moneys coming from its Crown Lands, which last assertion was not supported to the extent of one cent.  He also asked the Prov. Sec. what the reasons of the Government were for not carrying out the provisions of the law, and whether the Govt. intended in the future, as in the past, to treat the law as a nullity.
Hon PROV. SEC. was not sorry that this matter had been brought to the notice of the House.  He did not think that any reply was needed from him, as the clause of the Act to which the hon. gentleman had alluded, sufficiently answered every statement he had made.
He (the Prov. Sec.) was afraid that the remark he had made in debate, in a somewhat jocular manner—that it was in the power of the members for Cape Breton—by combining together, to deal a fatal blow at the Government, had had an unhappy effect.  From the remarks that had fallen on the previous evening from a gentleman who had usually ranked himself as a supporter of the Government, and from the style of observations just made, he was inclined to think that there was a disposition on the part of some of the members for that Island to assume an attitude of dictation to the Government.  Now, he wished it to be understood at the outset, that important as he considered it to be for the Country, that the present Government should continue to occupy the Treasury benches, and that the Province should enjoy for some time to come, the advanta ges of so excellent a Government, yet he had no hesitation in saying, that he would rather resign the position he held, and retire into the cold shades of opposition, than yield to unfair dictation from any combination of gentlemen. As regards the complaint of the member from Inverness, he had only to turn to the Estimates to prove that no other part of the Province had received so much consideration as the Island of Cape Breton, and at no time had the members for that section less cause to complain than the present.
Ever since he had the honor of a seat in that House, he had done his utmost to assist the members for Cape Breton, in their attempts to obtain for that Island that consideration which its importance deserved, and now after the Government had shown a disposition, which no previous Government had ever done, to deal liberally. with its wants, he would ask whether this was time, or the occasion, for any gentlemen from Cape Breton, least of all, for any one pretending to be a supporter of the Government, to assume an attitude of defiance and dictation.
The hon. Prov. Sec. here referred to the large provision made in the estimates for the various public services in Cape Breton, and to the pledge of the Government, that they would undertake the construction of the wharf at Port Hood, and asked whether in view of all this, it was fair for any member from that county, to complain of not having received proper consideration at the hands of the Government. As regards the facts of this case, he would say that the hon gentleman himself, was one of those who assisted in breaking up the system by which these monies were to be paid into the Treasury, and which had the effect of throwing the whole thing into confusion.
Mr. MCDONNELL—That was done before I came into the House.
HON. PROV. SEC,—was under the impression that he was a party to the arrangement, at all events the law of 1859 was altered so, as to  produce great confusion.
The hon. gentleman here read the act, and said it was the intention of the Government, to comply with its spirit and letter.  They intended as they had already informed the members for Cape Breton, to obtain reports from the Crown Land Surveyors, as to the localities most requiring aid, so as to carry out the provisions of the law in such a way, as would be best for the interests of the whole Province, as well as for the advantage of the Island.  The hon gentleman concluded by regretting that he should be called upon to denounce in the terms he had done this unfair attempt to prejudice the government in the eyes of the people of Cape Breton.
MR. BOURBINOT, as far as he was concerned, denied the existence of any combination on the part of the members for Cape Breton, and he was not aware that this matter was coming up.  He must do the Government the credit to say, that they had done more justice to Cape Breton than any previous one, altho he was not, prepared to admit that she had ever yet received her just rights.
MR. BLANCHARD was pleased to hear the assurance of the leader of the Government, that PARLIAMENTARY DEBATES. 275 these monies were to be applied for the purposes contemplated in the act. He thought that there was no doubt that the object of the law was to apply these monies to the opening up of roads through the Crown Lands, the discretion left with the Government was as to the time and manner in which they should be applied. He was therefore quite satisfied with the statements made by the Prov. Sec , and he thought that what he promised, was all that the members for Cape Breton had a right to ask.
The object of the members for Inverness in making the application they did, was not to supplement the road grant but to apply the money to open up roads through Crown Lands, which was the legitimate purpose contemplated by the act.
The hon. gentlemen explained the object of making the alteration in the law, alluded to by the hon Pro. Sec. It was held out as an inducement to settlers to take up Crown Lands, that they would be able to pay for them by their earnings from the expenditure of the public monies, in the opening up of new roads ; but when the three years specified as to the time for payment had rolled round, it was found that they were unable to pay, and the time had to be extended.
As regards the amount of justice that Cape Breton had received in the distribution of the public monies, while he was prepared to acknowledge that the Government had dealt as liberally with her as with the rest of the Provinces, he could not admit that she was under very great obligations. According to population she had just re— ceived what she was entitled to, one-fifth of the whole grant. This however was a distinct question, and depended altogether upon the rights which the law gave them, and he was satisfied by the assurance, that the Government intended to carry out the provisions of the statute.
HON. FIN'L. SEC. said that this was not a question of justice to Cape Breton, and the hon. Prov. Sec had done perfectly right, in rebuking the hon member for Inverness,  (Mr. McD.)  for placing it upon that ground.
He thought that hon gentleman had no reason to complain of the way in which Cape Breton had been treated, either in the distribution of the road grant, or in any other branch of the public services. While some counties had their road grants decreased, almost every county in that Island had theirs increased.
He would go further then the hon. Pro. Sec. had, and say that if the Government had acceded to the demand of the member for Inverness, and supplemented his new road grant, as he wanted them to do, they would have acted contrary to law.  He thought that he ought to be satisfied with the assurance that had been given, that the Government intended to carry out the policy of the law, as soon as they had received the neces— sary information from the Crown Land Surveyor.
MR. S MCDONNELL was glad that the government had at length announced the policy they intended to pursue in this matter. The hon. Pro. Sec. had thought proper to intimate, that in making his remarks he was actuated by covert motives.
He (Mr. McD.) did not think the course that hon. gentleman had thought proper to pursue in reference to this matter was conducive to strengthen the relations that subsisted between them, as to add to the decorum which should prevail in that House.  He had stood in his place, in the performance of a duty he owed his constituents, he had no private interests to serve, but he was simply demanding the rights which the law gave them. He most emphatically denied that Cape Breton had received more than her just share of the public moneys, or that he had demanded anything more than the Government were bound to give.
MR. C  J.  CAMPBELL denied that there was any combination on the part of the members for Cape Breton. He considered it unfair for any one to attempt to get up a feeling against that section of the Province. He pointed out the provisions of the act of 1859, and contended that it had not been carried out as originally intended. He alluded to the Crown Lands' office, and considered that more energy should be infused into the working of that department. He pointed out one or two cases within his own knowledge of the way the business of the peuple was impeded in that office.
The subject then dropped.

Railway Extension.

HON. PROV. SECY then moved the resolution for Railway Extension, which he had laid on the table some days previously. In doing so, he stated that he did not intend occupying the attention of the house with any lengthy remarks, for the simple reason that the policy that this resolution propounded, and the expenditure it involved, had been fully discussed, and had received the sanction of a large majority of the Legistlature. He would not open the useless discussion whether the present mode of construction railroads was the best. Suffice it to say, that the Legislature had decided, after a great deal of discussion, to construet Provincial Railways by Provincial funds. When that policy was propounded by the house, it was in connection with a certain scheme of railway extension — that certain lines of communication should be carried out under that policy, and the act originally placed on the statute book, and under which the first mile of railway was put under contract, provided for the extension of our railway system to the borders of New Brunswick, to the Gulf of St. Lawrence, to the Granville Beach on the Bay of Fundy. The house would see that the object was obviously to give to all the people in the different sections of the Province, as fully as was possible, the advantages of railway communication.  The cost of railway construction, however, in this Province proved to be worth so much more than was anticipated at the time the act was placed on the statute- book, that it was found impossible to go on with the policy as originally laid down. At the last session, however, the house decided to go on to Pictou, and tap the Guld of St. Lawrence. The Government, in bringing forward the act for the construction of that railway, felt it was their duty to the outlying sections of the country to lay down a policy which, without burthening the Provincial funds, would, at the same time, give the facilities of railway com 276 PARLIAMENTARY DEBATES. munication to the large, and populous, and fertile counties of the west as originally contemplated when the railway system was inaugurated.  He need hardly say that the house had been always ready to adopt any means by which the Province might have a railway communication with the neighboring Provinces and States.  Accordingly, the Government last session brought forward a proposition which they thought would accomplish, without burthening our means, the two-fold object of extending our road to the borders of New Brunswick and to the county of Annapolis in the west.  The resolution authorized the Government to enter into contracts with companies prepared to connect us with the railway system of New Brunswick, at a cost not to exceed 4 per cent. for twenty years, on a capital of £10,000 a mile.  At the same time they offered 4 per cent. on a capital of £6,000 a mile for the extension to Annapolis.  The surveys that had been made of these lines had proved, they believed, that the resolution offered most ample compensation to any companies that might undertake the work.  Under the authority of that resolution, the Government placed themselves in communication with parties who they had reason to believe would be disposed to carry out their policy, and the result of this correspondence has been to show that the provision offered was not quite sufficient.  The difference in the terms, however, was so slight, as to warrant the house to carry out the policy which received their sanction at the last session.-
He went on to explain that the terms on which the offer of the International Contract company was founded, involved but a slight addition to the terms sanctioned last year, being the cost of dredging the river Avon, which was estimated at £40,000, and the provision of £100,000 of subscription for the line to New Brunswick.  He believed that the affirmation of the resolution would entirely do away with the objections of the city of Halifax to taking the stock to this extent, but assuming that this sum had to be borrowed, it would only be an increase of two per cent., the offer of last year being to the extent of four per cent.  As to the route of the railway nothing could be now definitely said, and that matter would have to be decided by the government upon a careful examination. He said that the debt of Nova Scotia was fixed by the delegates who represented the government at the Quebec Conference at eight millions in consideration of the resolution of last year in connection with railways. That increase to eight millions would have given the means to complete the Pictou and Western line, leaving the Intercolonial road te be dealt with by the government, but assuming that the colonies were to remain as at present the burthen entailed for the extension would not be more than £28,000 for the trunk line, and £23,000 for the western line, including the cost of bridging the Avon, or about £50,000 per annum.  He thought there could be no doubt that the proposed extension would give us such an increase of trade and revenue as would compensate for the expenditure involved.  He expressed surprise at the opinion enunciated on a former day to the effect that railway construction should be undertaken by the government, by Mr. Killam, who had long been laboriously maintaining the doctrine that such construction should be left to foreign capi talists and companies.  He was glad to find that that gentleman's confidence in the government was so extended.  He thought, however, under existing circumstances, it was not advisable to prevent these capitalists who were desirous of constructing our railways coming in and expending their capital.
Mr. KILLAM said that it had always been his desire whenever the question of railway extension was before the Legislature to express such opinions as he thought favorable to the prosperity of the Province.  When the construction was commenced he thought it wise that the matter should be left to companies, but the other policy having been adopted he thought it would be well for the government to continue it in respect to the main Trunk line. It was estimated that the existing line would pay one per cent. above its working expenses, and there was every reason for supposing that the extended line would be still more profitable, while difficulties would be caused by having the railway under two distinct managements.  If the lines were expected to pay four per cent. which the Province had offered would it not be well for the government to undertake their construction and realize whatever profit was to be made?  He feared that by accepting the proposal the province would at the same time lose all the advantages that would arise from the increased prosperity of the country.
Hon. ATTORNEY GEN. explained that the government were to have the power at any time to take possession of the railway by arbitration in the usual form. If we were to hand over the lines without giving any control to the government or legislature, then there might be something in the argument of the hon. member for Yarmouth.  He believed that the time had arrived when we should deal with this question.  New Brunswick was prepared to build to our borders, and there was this gap between Truro and Moncton which should be built at once.  Connection with the railway system of this continent was, as all would admit, most desirable, as it would promote the best interests of this province.  If the government could build the line directly out of the provincial funds, it would be a matter deserving of serious consideration, but under existing circumstances he was of opinion that it was the wisest policy for us to accept the best terms that were offered us by companies who were ready to invest their capital in the country.
Mr. ARCHIBALD alluded to the great importance of the subject under consideration, and then went on to say that when the matter was before the house last year, he had the misfortune to be absent, and therefore had had no opportunity of offering any remarks upon it.—— Under these circumstances, he had listened to the observations of the Pro. Sec. that day with no little anxiety, for he was desirous of knowing upon what grounds he asked the house to consent to the very grave proposition which was contained in the resolution now before it. That hon. gentleman should have shown how the railways were to be constructed without crippling the resources of the country.  He felt exceedingly disappointed that the hon. gentleman had not adopted the course which he should have taken as a Colonial minister, asking the house to incur such heavy liabilities.— Now there was no one in the house who had been a greater advocate of railways than himself—or was more committed to their extension PARLIAMENTARY DEBATES. 277 within the limits of the Province. On some occasions he had even gone ahead of the Administration for the time being. In 1857 a resolution was moved in the house for the construction of the Pictou Railway. On that occasion he had warmly advocated that scheme, being then as now in opposition. The Government of the day, acting under the belief of what they considered most judicious under existing circumstances, refused to accept the resolution; and, after the calm consideration which a few years had enabled him to give to the subject, he had no hesitation in acknowledging that he thought they discharged their duty to the country on that occasion.
When last year an attempt to repeal the Intercolonial Railway act was made by the government he had not hesitated to express in the most emphatic terms his views in favor of communication between the Provinces, and his preference of that great scheme to even the Pictou railway which was at the last session under discussion. He would refer to his language on that occasion to show how warm he had expressed himself on the subject.
" It appears," he had then said, "according to the opinions of the present government of this province that the terms agreed to were too burdensome for Nova Scotia. The Canadian ministry have also taken the ground that the burthen imposed upon them is too great. With these opinions prevailing at the Nova Scotia end and at the Canadian end, it is obvious that even if the act remained in force, the prospect of an intercolonial line is adjourned to an indefinite period in the future. Therefore I feel that we can approach the subject of a Pictou railway in a very different spirit from what we could have done if there were any hopes from the legislature in reference to the intercolonial scheme. I have no hesitation in saying that in dealing with this important question I would not be doing justice to myself if I did unequivocally state what policy I would pursue if the intercolonial project were feasible. I consider the branch to Pictou is of sectional interest compared with the former scheme. It would be a priceless boon to Nova Scotia, jutting out as she does 500 miles on the path to Europe, if we could have consummated an undertaking which must. have made her the wharf on which the traflic of two continents would concentrate."
And again, "I must fully confess in conclusion that it has been with no little hesitation that I have given up so desirable a project as the Inter- colonial railway scheme. I have always looked at it as the precursor of that union which has so long been the hope of every intelligent man who wishes to see the arena of politics in this province enlarged and ennobled.. I fear very much that the actions of the government on the present occasion has done very much to postpone the great intercolonial question. I fear we are giving away the chances of ever effecting that great work, but on the gentlemen opposite rests the entire responsibility."
It would be seen, therefore, that while he did not hesitate to express the most unqualified preference for the construction of the Intercolonial Road, he had not attempted to disguise from himself or the house that the necessary effect of embarking in that scheme was in his opinion to postpone to an indefinite period the construction of the Intercolonial Railway on any scheme which was then open to us, or could be opened to our unassisted resources.
But not only was he interested in this railway as a public man, and from Provincial considerations, but he was a representative of a county through which that road must pass.— Again, he was interested in a valuable mineral property in that county, which would be exceedingly benefited by the completion of this enterprize, provided the route selected should be the one indicated in the proposals of the company and on the table of the house.  Therefore it would be seen that not only his interests as a public man and as a representative of the county, but also his personal and private interests were at stake in this matter.  Therefore, if he did not give his assent to the present resolution, it could not be said that he was acting from personal or selfish motives.  He thought, too, he could appeal to the house to bear their testimony, that during this and last session he had not exhibited any spirit towards the Government that would subject him to the imputation of factious opposition to any measure, but had a right to be considered as acting from a desire to discharge what he believed to be his duty to the people of this country.
He regretted that he had not all the documents at hand which would enable him to give that full information in respect to the state of our finances which he was desirous of giving.  At the last session of the house a resolution was adopted, by which it was determined that the financial year should end on the 30th September instead of on the 31st Decr., so it was impossible to get the means of comparison between 1864 and 1865.  A large portion of the liabilities which were chargable on the year did not fall due till its end.  He had, at an early period of the session, asked for the requisite information; but the Financial Secretary had not yet been able to hand him the documents which were necessary to make the accurate comparison he wished; no doubt, in the hurry of the session it was difficult for the officials to give all the information desirable.- However, looking at the accounts as laid on the table, he found that on the 30th September, 1864, the balance in the hands of the Receiver- General was $225,156 - a large amount, no one will deny, to be in the treasury.  The possession of this balance was nothing, if at the time it was in the treasury we owed the amount, or a larger amount than these monies would enable us to pay.
Now it appeared by the statement submitted that at the very time when this sum appeared to our credit we owed $276,000 for various services, so with this sum to pay, and only $225,156 on hand to pay it with, we could not be considered as having necessarily a large amount at our disposal.  We had, it was true, in the shape of assets coming  in, a considerable additional sum, but as far as he could gather from the accounts there appeared to have been borrowed from the Savings Bank $42,000, and from Treasury notes $40,000,  making $82,000, which had gone to swell the receipts, and which, though actually borrowed money, had been treated by the Government as so much revenue,  and added to the balance at their disposal.
He had been desirous or ascertaining our fiancial condition on the 31st Dec. last and therefore had asked for the amount of the revenue till that date.  He anticipated that there must be a falling off.  It was impossible to contemplate the condition of things in the United 278 PARLIAMENTARY DEBATES. States at this moment, and the effect that this would necessarily have on our commerce- it was impossible to view the panic which was beginning to show itself in every branch of business, and the necessarily diminished importations of the incoming year, not to feel that this would begin to show itself in the last quarter of the year, and he had asked to see the returns in the conviction that his anticipations will be realized.
By the returns the revenue of the year from customs and excise amounted to $999,000.  The revenue of the December quarter was $306,491. For the June quarter of 1862 it was $300,000. So that in the last quarter of the year the increase over the corresponding quarter of the year before was only $3000.  Compare that with the 9 months preceding.  The revenue of that part of 1863 was $564,938, for 1864 it was $692,818.  So that the increase in the past nine months of 1864 was $127,360, or at the rate of 23 per cent., while the increase of the last quarter was only $3000, or 2 per cent.  It was quite clear, therefore, that the prosperity of the early part of the year had not been kept up.  That a sudden and serious change had taken place, which was an omen of the condition of the present year, and might be largely relied on as indicating what we might expect, and the prosperity of the first nine months continued to the end of the year in the same proportion, we should have had an addition to the revenue of the quarter over what we actually received, of $63,000.—Now in 1863 we contributed one third of our entire revenue in the last quarter of the year.—This is pretty much the fact every year, and therefore assuming that the trade of the whole year were to fall off at the same rate, we should have less by $109,000 than if our prosperity had continued uniformly as it begun in 1863.
This is a very serious statement of matters, and well claims our attention.  I have asked for the returns of the first quarter of the present year, with a view to continue the comparison.  I have not yet received them, nor does it much matter.  The importations of the first quarter of any year are largely the result of accident.—They might be more or less in any particular year without largely affecting the returns of the year, inasmuch as they form altogether but a small part of our importations. The main business of the year is conducted in the Spring and Fall quarters.
Now what are the last terms referred to?  I have spoken of the panic in the United States —that panic will be felt here.  It will lead to the interruption of our trade with the States.
Then there is a great depression in prices impending.  The opening of the cotton ports of the U. States will bring down the prices of cotton fabrics and diminish immensely the price of cotton goods imported to this market.  This will react on the price of woolen goods, and between the two your advalorem duties will fall.  Then agricultural produce is going down in price.  A friend of mine bought, the other day, for the Cape Breton market a ton of butter for 12 1/2 cents a lb.  This came from the U. States, where not long ago we were sending our butter and getting three times the price for it.  Other articles of produce will fall, if not to the same extent.  The immense market made by the fleet of blockade runners sailing from Halifax is at an end.
The ability to buy, which the farmer derives from a large and ready market for his goods, has passed away, and our merchants will anticipate the change, and regulate their importations accordingly.  Then shipping and shipbuilding are both declining; freights are low, and the inducements to build are not great this year.
Contemporaneously with all this, the market was largely supplied with goods not intended for it.  The cargoes shipped from England to the Southern States, and which recent events had prevented from going there, were thrown suddenly upon this market, and had to be sold for whatever they would fetch.  They of course would be entered low, and thus would afifect the advalorem duties, and diminish the usual importations.  Now, could any person of ordinary foresight shut his eyes to this concurrence of events.  Was it possible to anticipate that the revenue could be maintained; and if it fell, in what condition would we be found?  Suppose we were to enter on this year as we did the year which followed 1854, would we be far astray?  1854 was a year of plethoric revenue; but it was followed by several successive years of declining trade and falling income. It would not be unreasonable to expect that the receipts from customs and excise in 1865 would not much exceed $800,000.  The revenue after 1854 did not for many years reach the figures of that year.  Whether we collected more than that in the ensuing year or not, he was quite sure that we would not be justified in making our calculations on a larger scale for several years to come; and if that was true, we should be unable to meet the appropriations we have made this year by an enormous sum.  But these appropriations, large as they were, made no provisions for our new liabilities.  Now, let us see what these are: First, there is the Pictou railway.  This was estimated at first to cost us $1,600,000.  It was supposed to be forty miles, at £10,000.  The government pass the bill before the road is created.  It is then measured; and forthwith ten miles or one- fourth of the whole is added to the length and cost.  Then Mr. Fleming surveys the ground more accurately, and finds it will cost 2 1/2 million of dollars to build it, and somewhat more to build and equip it.  He is told, however, that he must reduce his figures, and he does so, and now tells us we may have a road for two millions.  Anybody, however, who knew how immensely expenditures exceed estimates, must be satisfied that if we get off for two and a half million of dollars we should be fortunate indeed.  Now, as the contracts are to be completed in 1866, we are fully assured that one half the work will be done, and one half the cost incurred in 1865.  If so, we shall need to sell debentures to supply what means we require. Already we have had them in the market for several months, and we have sold £21,800 stg. or $109,000.  Suppose we have to make up the amount we shall require for the year 1865, we shall need still to sell over $1,000,000 in debentures during the present year.  How is this to be done? Our debentures are now selling at 92 to 95 per cent.  At par they are worth, with the interest to date, £101 10s.  So that on every debenture we sell, we lose from £9 10s, to £6 10s.  Take the medium and there is a loss of 8 per cent., which, on $1,000,000 alone, would be a loss of $80,000, and would add that sum to the cost of the PARLIAMENTARY DEBATES 279 railway. Can anybody hope, in the uncertainties of the future, that we can sell at par what we require this year?
But not only are our sales affected by the uncertainties of the future; they must be largely affected by the certainties of the liabilities we are heaping on ourselves. We have before us a Bill to construct the St. Peter's Canal. This is variously estimated. Mr. Perley, who is the best Engineer out of the half-a-dozen who have reported on it, put the cost at $170,000. We have appropriated, this year, bonds at $30,000, which will leave a sum of $140,000 to be provided for-assuming you could place any reliance on the estimate for a Canal. But as a rule, nothing can be more fallacious than such an estimate. A Railway may be estimated. Any work on the surface of the ground may be computed, but there is something in the nature of canal operations which renders such computations unreliable. The Shubenacadie Canal was estimated at $250,000. It cost $500,000, and was then scarcely begun. It was subsequently made a present of to gentlemen who were deluded with the idea that it could be finished for $40,000—by the amount of estimate by a competent Engineer. They accepted the fatal gift, and spent $200,000 to find the work still incomplete, and with all this money spent on it, it would be difficult to find any other body of gentlemen who would be willing to accept the thing as a gift.
The Welland Canal was begun by a subscription of stock to the extent of $150,000. Before it ended the enormous sum of $6,629,000 was spent in its construction.  I do not contend that the cases are paralel ; there were circumstances in each case to render the works much more formidable that anything that is completed at St. Peter's ; but I refer to these instances, to shew the whole unreliability of canal estimates ; and I undertake to tell the house that nobody need expect to come out of this scheme under $200,000. But the government are determined to commit the house to it ; and if so, we may as well look the expense steadily in the face, and prepare for it.  Let us then assume we have to raise the amount, how can it be done?  By debentures alone ; and this will throw into the market well on to $200,000 more of debentures.
Next we find an additional liability to be assumed for Mabou or Port Hood wharf.  What this may be we, on this side of the house, have as yet no means of knowing.  Indeed but for the sudden revelation which flashed upon us the other day, when one of the hon. and learned members for Inverness complained that it was not in the estimate, and expressed his fear that the promise privately made would not be redeemed, we should have been ignorant, that any such expenditure was intended.  But now that the hon. gentleman has had the private promise, publicly acknowledged, we may prepare for another expendi ture in that quarter.  That it will be of no trifling magnitude, is clear ; but with the obscurity that surrounds it, we cannot undertake to say what is its extent or merit.
Next in order comes the scheme for aid to the railway to the borders af New Brunswick. The proposition is that we shall give 4 per cent. or £10,000 a mile for twenty years. This is equivalent to an annuity for 20 years of $120,000; and the proposition as made to us-the proposition as this house, if it passes this resolution assents to it, is that either party is to have the option of capitalizing this annuity ; and that, too, taking both propositions together, not on the terms of paying in debentures what the annuity is worth, but paying a principal sum which shall yield an interest equal to the amount of the annuity ; leaving it to the company to be formed, to pay off the principal sum out of a sinking fund to be instituted by them for that purpose.  It is quite true that the government declared they do not intend to allow the capitalization to be made on that footing ; it is quite true that they have said they will not even give the contractors the option of capitalizing at all ; and further, that they will not capitalize under par value ; but when they make these statements, they are not accepting the proposition ; and yet, while they do not accept it and declare they will not accept it, they ask us to pass a resolution to empower them to do that which they say they have no intention to do. But whether they capitalize, or not, they are to take stock to the extent of $400,000,  for which they must issue debentures, and these debentures must be put in the market.  If they are sold, of course they will affect the saleable value of the debentures for the Pictou road ; and whether they are sold or not, the very fact that this amount of debentures is to be thrown into the market—or is liable to be thrown into it-will reduce the value of the other bonds.  If this proposition stood alone, it would be difficult to bear the burden of it ; but when it is accompanied by another proposition, equally burdensome, it is impossible to contemplate the position without fear and apprehension.  Indeed, it would seem that the twin scheme is looked upon with even more favor than the New Brunswick proposition. On the 23rd November, Mr. Levesey's proposition was before the government.  It had been before them for weeks ; yet the government do nothing.  Connexion with New Brunswick and the United States may be secured by accepting the offer ; but it is not accepted,-and from that day to this no sign is made, no council is held, no minute passed either accepting or rejecting the proposition.  It is quite otherwise with the Annapolis scheme.  A constituency is vacant—a member has to be secured- and forthwith a council is convened, and a minute passed, and the government pledged- and the house controlled, so far as that pledge controls them-to build the Annapolis road. 
New let us see what this involves-4 per cent on £6000 a mile, or 80 miles, is equal to $76,800 a year, and there is the same option as to capitalization.  And as in the North so in the West an aditional liability is to be incurred.  The Avon is to be bridged, and the Government are to bear the cost.  This we have no estimate for, but the Provincial Secretary put it at $160,000.  I don't pretend to be an Engineer, but judging from the width of the river, the character of its approaches, the nature of the foundation, nobody need be astonished if it should cost much beyond $200,000.  And for this sum debentures must issue, and these again will act upon the debentures for Pictou and affect their value in the market, and increase the cost of the Pictou Road. Now let me group all this together: 
Annual debt.
We shall have to pay for the Pictou road............................ $150,000
Cumberland road .................. 144,000
280 PARLIAMENTARY DEBATES.
Annapolis.......................... 76,800
Avon Bridge....................... 12,000
St. Peter's.......................... 12,000
$394,000
Less 4 per cent. guaranteed on stock taken on road to N. B., 400,000. . 16,000
$378,000
So that for these liabilities, when completed, we shall have to provide a Revenue of nearly $400,000 a year. But this is not all. We borrow money, which we ought not to have borrowed, to erect a building in Halifax which is to cost us ÂŁ30,000. We borrow, to be sure, from the Savings' Bank, and to pay only 4 per cent, but this will entail some $5,000 additional for interest. So that if this added to the other sums, we may fairly put our whole burthen at $400,000 a year, and this to be paid all by new taxation. True, the Prov. Sec'y says that we may count an additional revenue from the Railroads as reducing the charge. But we are already counting $50,000. The Finl. Sec'y has taken credit for that amount this year. In 1863, the whole yield was $22,000 or thereabouts. In 1864, very little more, and it is beyond reasonable probability that will yield $50,000 in 1865. But if, when the roads are completed, there is a larger yield, it will arise from a larger traffic, and just in proportion to the traffic will be the wear and tear, and the time is at hand when necessarily the permanent way will require to be renewed, and all that we can obtain, and more, will be required for that service when it has to be done.
Now, Mr. Speaker, I believe I have not overdrawn the picture. It is not very wise to present the state of our public finances in a gloomy aspect. I have great faith in the character of our resources; I think that with fair play, we can cope with a large burden; I believe, too, that if depression come, we may feel it severely for a while, but in time we shall rally again. But if the prospects of the incoming year are such as I have described them—if we have no reason to hope that our revenue will meet the amount already voted away, and if the necessity of preserving the public faith intact is a paramount consideration—if we are committed to the, Pictou contracts, and must find the means to pay at whatever cost,—I have seriously to ask this House whether they ought not to pause before committing the country to those enormous additional responsibilities. Three years ago the country was disturbed from one end to the other, lest taxes should be imposed to meet a temporary deficiency, the interest of which would only be about $8,000 a year. And yet the gentlemen who raised that cry, and who made the people believe it, are not only enormously increasing the ordinary expenditure, but adding a debt which must be provided by new taxes, to the incredible amount of nearly $400,000 a year. He asked the Government to give themselves a year to breathe, and see what the prospects were. In all probability nothing could be done for one year, even if they passed the resolution. New Brunswick was hardly in a condition to incur additional liability, and if it were, he had reason to believe that the favorite project there would be western extension. The people of that Province were deeply interested in connecting their railway system with that of the United States, and were not perhaps so anxious to extend that connection east of their own metropolis. At all events there was good authority for believing that a gentleman exercising much influence in the present Government of New Brunswick, without whose aid it could hardly exist, stood pledged to support no Government work. If this was so, New Brunswick, clearly, could do nothing more, and any hopes of connection between her rail road and our border might be given up for the present. If then to press this resolution could do no good, if the only effect of pressing it would be to do mischief by operating upon our Pictou loan, and depressing it, he ask- asked the government whether as men of ordinary prudence, it was not their duty to accept the suggestions that were offered from this side of the house, and not needlessly imperil the public credit or embarrass our finances?
He felt that as a member of the opposition he had no particular responsibility in this matter. It was the duty of the government to be satisfied of its ability to cope with the enterprises it originated; but, as a public man, owing a public duty to his constituents and the province, he had raised his warning voice, and felt that, whether it was listened to or not, he had done his duty ; and he wished and hoped the government would receive his suggestions in the spirit in which they were offered.
One word more and he would not detain the house further.  Many gentlemen had appeared to be in great dread of confederation from the increased taxes that might be imposed.  Whether confederation would or would not result in that, he would not stay now to ask; but he was curious to see whether these gentlemen, who were frightened at imaginary taxation, were willing to subject themselves to a real taxation exceeding the wildest flights which the opponents of union had ventured to assume as the result of confederation.  If we were willing to bear these taxes—if we were willing to rush into them when no necessity pressed us,—then he could not but feel, and he did not say it offensively, that the dread of taxation was mere hypocrisy, and those who used that argument would show their insin— cerity by voting for this resolution.
Hon. FINANCIAL SECRETARY replied: I cannot pretend to have so long a familarity with public accounts as the hon. leader of the Opposition, nor to possess the financial ability of that hon. gentleman; but I think I shall be able to show that the premises on which he founded his statements—statements which, if true, would justly create serious uneasiness in this county—are entirely baseless.  I have no hesitation in saying, that the facts and figures in the possession of the hon. member (which were as full as it was possible to procure for him) were sufficient to convince him that his statement was entirely fallacious.  He started with the assertion that in the preparation of the estimate which I laid on the table there was the large sum of $82,000 placed to our credit which did not belong to it.  He was good enough to insinuate, if he did not assert, that I was so incompetent to discharge my duty as to allow the sums borrowed from the Savings Bank, and the amount of Provincial Notes issued by the Receiver General, to go with the general account without giving credit in the estimate.  Now if the hon. member had taken the trouble to look at the paper in his hand, he PARLIAMENTARY DEBATES. 281 would have found that he is entirely inaccurate. By the Receiver General's account, it appears that the sum of $40,000 was issued in Treasury notes, and an amount of $42,000 was borrowed from the Savings' Bank. The Treasury notes were issued on the authority of the House, in connection with the new Provincial Building, and $42,000 was borrowed towards the construction of the Pictou Railway. The sum of $148,000, which I show is the balance in the general treasury for my disposal, is totally independent of the $32,000 in question. In the Receiver General's account there is paid for the Pictou Railway $21,000, and the balance is brought up as outstanding liability against the Province, as a glance at schedule B of the estimates will show. Then there is the sum of $40,000 of treasury notes. By an Act passed in 1863, the Government were authorised to issue Province notes not to exceed $40,000, and to take from the Savings' Bank a sum not to exceed $60,000 for the purchase of the lot known as Hare's lot, and the erection there— on of the public building now in course of canstruction.
In accordance with this authority, the lot was purchased, the building contracted for, and up to the 30th Sept. last the account of that building with the Province stood as follows:—
From Savings Bank in 1863 . . . .. . . . .. $36,000
New Notes in 1864 ....... ........ ........ 40,000
$76,000
Paid for Land . . . .. . . . . . $39,644.30
On acc't of building in 1864. . 6,116.45 45,760.75
Leaving a balance of. . . . . . . . . . . . . . $30,239.25
being the amount brought up as a liability against the Province, as the hon. gentleman woukd have seen at a glance had he taken the trouble to consult the papers which have been under his hands for weeks—before attempting to prejudice the government by statements entirely without foundation and greatly calculated to mislead those not having the ready access to the public accounts which the hon. gentleman can command. The hon. member then proceeded to question the soundness of the esi timate for the present year, and compared the receipts of the past two quarters with those of last year. The house will recollect that the actual custom's receipts were $999,000. Now I have before me the contingency of a revulsion of trade—the probability that in view of events transpiring in the United States there might be a serious reduction in the revenue received from our imports. Therefore I estimate $79,000 less than was actually received last year. There is nothing that I can see in the circumstances of the country—apart from any great convulsion of trade that nothing at times can prevent—to warrant us in corning to the conclusion that the year is not to be a prosperous one in a commercial and financial point of view. We see in the island of Cape Breton which is making such rapid progress in all the elements of prosperity, immense sums of money are being expended for the development of its resources and the construction of the Railway. Under such circumstances the people in that section must be better able than heretofore to buy largely of dutiable goods. We have the assurance that capitalists are ready to expand an enormous sum of money in proportion to our population in the extension of our lines of railway. Again, the Province is going on with the construction of the Pictou line. According to the hon. member we are this year to expend a million and a half of dollars among our people in connection with this work. All these facts show that there will be a large amount of money in circulation, and as the people will buy in proportion to their ability to pay, the consumption of dutiable articles must largely increase with the increased circulation of money. Therefore, apart from the general favorable condition of the country, I think under all the circumstances, no man is justified in saying, that for this year at all events the ordinary receipts from our ordinary sources of revenue are to be largely reduced. I am not, however, obliged to deal in mere generalities on this point. I have, on a previous occasion, shown that in the first quarter of this year we had received over $100,000 in excess of the same quarter last year; now we have another quarter gone by, the one ending in March. The revenue for that quarter is $129,000, or an increase of over $20,000 on the same quarter of last year.  I can also state to the house that I had the assurance of gentlemen who can best speak as to the prospects of our revenue for the present quarter, that they are most favorable, and that, in fact, there will be an increase in the receipts over the same quarter of 1864.  Under these circumstances I don't think the hon. gentleman was justified in drawing the alarming pictures he has of the state of our affairs.
The hon. member went further, and charged the Government with recklessness in spending large sums of money.  He complained that he had not the liabilities to the end of the year at hand,—that it was impossible for him to get at the exact condition of our financial affairs, and thereupon assumed that the expenditures were largely in excess of the receipts.  My hon. friend from Richmond, when Financial Secretary, estimated largely in excess of the actual expenditure, and the paper which I hold in my hand shows that on the 30th Sept. the Receiver General had paid on the estimate of my hon. friend an amount very much less than the estimate. Supposing the total expenditures to be as stated, yet the hon. member will find that the financial condition of the country is sound, and that there is no reason whatever why the country should be in the slightest degree alarmed as to its ability to meet the obligations it has incurred.  The hon. member attempted to cause alarm respecting the sale of our debentures. Every man who has the interest of his country at heart must deprecate the attempt to prejudice the public mind in connection with the position which our debentures occupy in the market.  I have reason to know that the discussions which have taken place in another branch of the Legislature have already deterred men from investing in these bonds to the extent they intended.  Before an hon. gentleman endeavored to create mistrust and prejudice on the public mind in this respect, he should have at least grounds for so doing, and I for one cannot see that he has any.  He is altogether in error in estimating the expenditure on the railway to be one and a half millions during the present season.  I have reason to believe that theexpenditure will be between 700 and 282 PARLIAMENTARY DEBATES. $800,000, and that there will not be any serious dificulty in obtaining the money required.
The hon. gentleman next stated that the adoption of the resolutions on the table would impose upon the country an additional burden of $400,000 per annum for Railway interest; and on giving us his assumption that $800,000 will hereafter be the highest amount on which we can calculate as revenue receipts, he concludes that we shall not be in a position to meet the increased demands upon our revenues. Now, sir, I assume that our revenue for at least a few years to come, will not be materially less than at present; and I found the estimate upon the increasing trade of the country, which I have before endeavored to show the house, must inevitably be the result of the large expenditures now being and likely hereafter to be made on our public works and in the development of the mineral wealth of the country. The hon. gentleman has altogether ignored this view of the question, and also the not only probable but inevitable inrease in our casual and territorial revenue. We must also consider the very large increase which must take place in the earnings of ourpresent railways on the completion of the contemplated extensions, east, north and west. Now it must be evident to the house that every coal mine opened not only represents the capital invested in its development, but gives annually an additional revenue in proportion to the extent of its shipments—just as every additional mile of railway built in connection with existing lines will throw a large additional traflic on the government work. The receipts on our roads are even now largely increasing, as every month's return shows—and I shall be much mistaken if the receipts this year will not amount to $200,000 as against $168,000 last year I assume, therefore, that I may safely ask the country to base the revenue for a few years to come on the estimated revenue for the present year—and on that assumption it will not be difficult to show that even without resorting to the expedient of raising our present tariff the additional burdens could be met, and all the substantial interests of the country subserved. Indeed, was I inclined to rely upon such authority alone, I need only quote the speech of his friend the hon. member for East Halifax, who, in a speech delivered in Temperance Hall, when his object was not to depreciate the resources of his country, proved to a demonstration—if his figures be accepted as of any value—that the country could safely undertake the work contemplated by this resolution without seriously entrenching upon the other essential services of the country. The hon. gentleman has even stated the liability which the adoption of these resolutions will entail—the amount being $312,000 with the interest on the cost of construction of the Avon bridge. This estimate will give the following result:—
Estimated Revenue for 1865 ................ $1,307,927
Liabilities.
Present Railway Interest............ $240,000
do for N. Brunswick line....... 112.000
do for Pictou line............ 120,000
do for Annapolis line...... .. 81,600
$553,600
Civil List 63,205
Criminal Prosecution 1,600
Crown Land Department 14,000
Coroners Inquests 1,400
Revenue expenses 61.000
Judiciary expenses 1,400
Poor Asylum 8,000
Rations to Troops 100
Steamboats and Ferries 11,000
Militia 20,000
Postal Communication 58,750
Return Duties 66,000
Education 127,000
Indians and Relief 1,300
Public Printing 8,000
Gold Fields 12,000
Agriculture 6,000
Railway expenses 120,000
Statistics 3,000
Legislative expenses 45,000
Relief of Poor 8,000
Navigation Securities 8,000
Public Works 90,000
Miscellaneous 6,000
$1,244,455
Present ordinary Road Grant 160,000 1,404,455
96,528
Leaving a balance of only $96,528 to be made up from the increased receipts upon our railways and on the revenue derived from our coal and gold mines—or if necessary by a small addition to our tariff, which would not be felt by the people, and which they would willingly grant on advantages to be derived. It was never contemplated by any one party in this house that our public works could be largely extended without somewhat increasing our tariff, at present the lowest in America; but it is not necessary that I should now enter on that subject. One word now, sir, as to the propriety of a gentleman occupying the position admittedly occupied by the hon. and learned gentleman from Colchester, as a financier, for any purpose attempting against the facts of the case to depreciate the financial position and character of the country at a time when it is the duty of every man to further and sustain its credit. That hon. gentleman's position and talents give even false and erroneous views and assertions when propounded by him, a weight and consideration which would not otherwise attach to them, and he will be held responsible by the country for allowing his eagerness to embarrass the government to betray him into the hasty and inconsiderate statement of facts either utterly baseless or founded on mere speculation, but which may, not,withstanding, coming from such authority have a tendency to injure the public credit.  His calculations to-day, sir, are somewhat on a par with those by which in 1859 he proved so conclusively that the Pictou Railway could be built at a cost to the Province of  £6000 a year, and, I am sorry to say, are not a bit more reliable than that celebrated financial statement.  I have thus shown that the hon. gentleman's attempt to impugn the correctness of  the estimates on the table have utterly failed.  I have attempted, and I think with success, to show that the large expenditure of this Government for the present year is founded upon well-considered and safe calculations of our resources, and that Mr. Archibald's attempt to play the alarmist is due rather to his desire to embarrass or injure the Government than to any fear of financial embarrassment on the part of the men who did not hesitate to embrace the Quebec scheme of 1862 for the construction of the Intercolonial Railway
I can only say, for my own part, if it was at PARLIAMENTARY DEBATES. 283 all apparent that the construction of these railways was to impose burthens we could not bear, I would hesitate before adopting the resolution. No man in this country, however, can deny that, if we are able to obtain the connection with St. John, and with the railway system of the continent, we shall gain vast commercial advantages. The increase in trade will soon counterbalance any additional burthens that we may impose upon ourselves. Railways make trade wherever they pass, and no one can doubt that a road to the fertile counties of King's and Annapolis would be not only a great boon to the people of the west, but create an ultimately remunerative traflic. In due time a trade would accumulate that would repay handsomely the Province for the expenditure it might incur.

Source:

Nova Scotia. The Debates and Proceedings of the House of Assembly. Halifax: Croshill and Bourinot, 1864-1867. Digitized by Canadiana.

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