Mr. GANONG.

than those Canadian producers who are utilizing Canadian railways and whose products are seeking the same markets; and they draw the inference that there must be "some defect in a system which permits Canadian railways to carry those products from United States territory into another point of United States territory at a less cost per ton or per mile than it costs Canadian producers to carry goods to the same points. Naturally, therefore, they complain, and they complain loudly, and they are looking forward to the establishment of a railway commission in the expectation that it will tend to relieve them, to some extent at least, of this burden which they regard as onerous and unfair. You will see in this fact a sufficient reason, I think, to justify the opinion which prevails so largely in the province of Ontario as to the necessity of a railway commission. X expect that a commission of this character will afford a considerable measure of relief to people who are complaining in this way, though I fear it will not relieve them to the extent which they expect.

Now, having by way of preliminary, outlined the object, let us turn to the Bill. The Bill is largely framed for the purpose of constituting and putting into operation a railway commission. It also makes provisions with regard to a great many other matters. While it is a Bill to create a railway commission, it is at the same time a complete revision and codification of the existing railway law passed in 1888, and of all the amendments which have since been made. We thought that it was no use taking the subject up at all unless we presented in one single measure all the provisions of a general character which relate to the construction, the maintenance, and operation of our railways. There was need for a considerable revision of the existing law, not in particulars of great moment, but in many minor particulars which would contribute to the convenience of the board in carrying out the work of the commission, and aid them more efficiently to enforce the regulations, and which would be at the same time explanatory of certain provisions in the existing law about which there may be doubt. We have, therefore, had this whole law carefully revised and consolidated, and although the creation of a railway commission is the chief object, this and other points- have been taken up and dealt with at the same time. I think I may properly describe the Bill which is now submitted as a bona fide and earnest endeavour to create a railway commission with such powers and furnished with such jurisdiction as will afford the fullest possible opportunity of working out this question to a successful issue. We have had before us the experience of other countries, we have had before us the experience of England and of the various states of the union, as well as of the inter-State Com-

Hon. Mr. BLAIR.

merce Law of the United States. These have been studied and their defects have been examined. The difficulties in enforcing their laws have been ascertained, and so far as it was possible in our judgment we have made better provisions for successfully operating a railway commission.

With the enactment of this Bill, therefore, and I may say as a consequence of it, the present Railway Committee of the Privy Council passes away. It was not thought desirable that we should retain the Railway Committee to exercise any of the powers which it now exercises. There are some directions in which I think one who has acted upon that committee for some years might fairly say that the committee has done efficient work. I am not going to say that the Railway Committee of the Privy Council is an ideal tribunal. I think it -would be impossible for any ti'ibunal whose members are charged with all the duties and responsibilities of Ministers of the Crown, to do the work which devolves upon the Railway Committee in a thoroughly efficient manner. Still there are some branches of the duties heretofore imposed upon that committee which I claim they have most efficiently discharged. I think there, has been, and there will be, no grave complaints made against the efficiency of the Railway Committee unless it be in respect of the regulation and control of freight rates upon railways. Outside of that subject, I think the Railway Committee has discharged its functions efficiently, and in saying this I refer to the Railway Committee as it has existed at any time in the past as well as to-day. For myself I would not be disposed to listen to any reason for the abolition of the Railway Committee of the Privy Council did I not recognize, and did we not all recognize, tjiat that committee has not the time, nor the opportunity, nor the facilities for taking up minute questions respecting the control and regulation of traffic upon railways, and the rates and tolls to be charged by them; this is work that could be done more efficiently by a tribunal specially constituted for that purpose.

Now we propose to transfer to the board which constitutes the railway commission all the powers which are now possessed by the Railway Committee of the Privy Council, and as I shall point out to you, we are extending and enlarging these powers. As far as we have been able to gather from the experience of other railway courts of commission we have felt that there were defects which it would be possible to remedy and by extending and enlarging the powers of the railway commission over those which have been hitherto or elsewhere constituted we have thought that we have made a judicious move in the direction of improvement and grafter efficiency. We have, therefore, given them all the powers hitherto possessed by the Railway Commit-

tee, and added to those powers. We have introduced, it will be found, no doubt, entirely new provisions, and some perhaps which may be regarded by some lion, gentlemen as extremely radical. Some of these provisions we will examine a little later on. The chief features of this Bill then are the constitution of a railway commission and the regulation of tolls. These are the two main and capital features of the measure. As to the board of railway commission, we have defined what the constitutiou shall be and we have in this Bill defined the number of the commisioners, we have defined the tenure of office, we have declared under what conditions changes may take place and we have introduced other necessary provisions of that character, but, we have done so, I want to say now, with this intention in our minds : We have

reached the best conclusion which we have been able to reach as to the constitution of the board and as to the other features which I have just mentioned, but, the main principle being maintained, we are not at all deceiving ourselves with the idea that we have exhausted all the wisdom iii the particular detailed provisions that we make in respect to these matters and we will be quite prepared in a spirit of fairness and liberality to listen, to weigh and to judge any suggestions which may be made to us from either side of the House. We have thought it necessary, in constituting a commission of this kind, that it slffnild be so constituted as that we will be able to secure the very best material which our country affords for this purpose. We feel that we ought to afford the widest possible opportunity within it to make the choice, because, Mr. Speaker, as this question impresses itself upon my mind, the character, the capacity, the wisdom and the selection of the men is everything. Unless this country can afford us men of the right stamp, men of independence of character, of firmness and of fairness, men who have experience in business, experience in railway operation, experience in law, unless the country can afford us these conditions, then, we cannot look with any reasonable hope to find that the operation of the commision will be successful. We have, therefore, to give to these men such a tenure as will invite the men that we want to come and take their seats upon this board. We have to give them a tenure long enough to induce them to give up any business in which they may be engaged and which may be profitable. Then, we have to pay them well. We have to give them a long enough tenure and we have to pay them reasonably well, because, if we do not do both of these things we cannot with confidence hope to secure men of the capacity and of the calibre that we require. Further, we propose that the board shall consist of three members. Perhaps, in the opinion of some lion, gentlemen, that will not be enough. That is a question that 774

we are not unwilling to consider, but it appears to us that three members of the commission, rightly selected and chosen are enough to dispose of the questions which will come before the commission, and to do it efficiently. We propose that the term of office of the three commissioners will be ten years, with eligibility to be reappointed, and that no member of the commission may be removed except upon an address of both Houses of parliament. We have not, in the Bill which will be laid on the Table, filled the blanks as to the age limit. We have not filled the blanks as to the salaries which will be attached, but it appears to us reasonable that with the commission constituted, the chairman, upon whom will devolve, I suppose, naturally, a somewhat heavier responsibility than that which will fall to other members, such as the responsibility which devolves upon judges and so forth, should be allowed an additional salary beyond that which we will allow to the other two members of the board. We have not filled the blanks, however, in regard to the age limit or to the amount of the salary.

Mr. SPROULE.

What about the qualifications of the men, the personnel ?

We have not defined the qualifications of the men. I was going on to say that in our minds, and it is proper that I should state it, because I am speaking with the authority of the government, and therefore what is said as respects the selection of the men for this purpose would be as binding as if it were contained in the statute, at all events, as it affects our appointments, that there ought to be on that commission one person having a somewhat lengthened experience in law, a man who would be qualified to fill a position on the bench. We have thought that if we could get a man who has had some railway experience, some experience as to railway legislation and railway operation, and as to questions arising in connection with railway controversies, so much the better. If such a man can be found, we ought to find him and he ought to be appointed. We think we ought to have a railway man also, and when I say a railway man I mean one who has not only been trained in railway work in all its branches, but one who would have considerable knowledge in reference to matters of transportation, traffic arrangements, freight rates and questions of that kind. We have thought that the third member of the commission should be selected from the general community, a man having some business experience in reference to transportation. I do not care to what particular class of business he may belong. I do not say that such a man need necessarily have been in merchantile life, that he need necessarily have been a manufacturer, or a large producer, a farmer for instance, who has had

large business with railways, but I would leave it open so that any one of that character, in any of these classes, who was found or believed to possess the necessary qualifications, might be chosen as a member of the commission. The powers conferred upon the board, I think I have already sufficiently indicated, and that I need not weary the House at greater length upon that point, further than to say this : That we have made some material changes in the existing law in a direction which we believe will commend them to all who have had anything to do with railway business and railway controversy. We are proposing that the railway commission shall have power finally to determine all questions of fact subject only to an appeal to the Governor General in Council. We do not believe that it would be expedient that this tribunal should have its decision on questions of fact subject to any revision by the courts, and for several reasons. In the first place, surely three gentlemen of the standing and character that I have named ought to be as competent as any tribunal you could set up to determine what the facts are in any given case which may come before them. If you grant an appeal, you allow a tribunal which has not heard the witnesses, and which has not special training and experience to determine upon the matter and to sit in judgment upon the findings of this specially qualified commission. I do not think that is expedient. Moreover, we hope that this measure will have the effect of very materially restricting litigation, which has been found to be a serious menace to the successful operation of the railway commission in the United States. Any one who has read the report of Mr. McLean will recollect his statement that taking the years in which railway commissions have been in operation in the United States, there has been an average of four years between the time when litigation is commenced and when it has terminated. We think it is desirable ; indeed we think it imperative on us to prevent the possibility of persons who feel they may have grievances against railways not being able to have their cases determined within a reasonable time. We have therefore asked parliament to say that the decision of this tribunal shall be final, subject only to revision by the Privy Council, and that there shall be an appeal to no other tribunal.

We propose in this Bill to give the power to the railway commission to control the rates. Under the present law the Privy Council fixes the maxima and minima rates-very seldom of course fixing minima rates but there are cases. Any variation which the railway company wishes to make within the maximum rate, they have it in their power at present to make that variation. We have provided here a new way by which we think that we will afford the fullest measure of protection to the persons Hon. Mr. BLAIR.

who are using the railway and to the railway itself. We propose to divide the traffic upon the railway into three distinct classes. First, there is the ordinary traffic ; second there is the commodity traffic ; and next there is the competitive traffic. With respect to the ordinary traffic which I think will be the largest portion of the traffic, we propose to confer upon the railway commission the power to fix or sanction what rates shall be charged. We propose to say that upon a schedule of tariff for ordinary traffic being submitted by the railway company to the board, the board may say that that rate shall be charged and that no higher rate or no lower rate shall be charged-except under conditions which are subsequently provided for. The railway commission will fix and control the rate for the ordinary traffic which embraces everything that is not specially regarded as competitive, and which is not specially included in the commodity traffic. What the commodity class means is this : The board may authorize certain classes of merchandise to be taken out of the ordinary traffic class and put in a special class to be called the commodity class ; or, having once put a certain article in the commodity class it may retransfer it to the ordinary class. As to the commodity class the board declares what shall be the maxima and minima rates and it is only with respect to the commodity class that that varying rate is permissive.

Hon. Mr. HAGGART.

What constitutes the commodity class ?

All classes of goods which at the request of the shipper or at the request of the railway company, the board may think it desirable to take out of the ordinary class which is at a fixed rate of freight, and transfer to this commodity class. This commodity class is very well known in the operation of railways. We have decided that as to the control the board may exercise over this commodity traffic, it would be well that it should have the power to fix a maximum or minimum rate and between these the railway company may make its choice. When the company does make its choice, then while the schedule is !n force it must publish that schedule in the fullest possible manner ; post it in the offices and otherwise bring it to the knowledge of the public so that every one may know what the commodity rate is.

The competitive class is a class which it will be seen at once arises in connection with business to which no regular tariff can possibly be made to apply. We have got to recognize that the conditions are constantly varying and altering; new competitors are coming into the field, and a railway company cannot possibly be held strictly and rigidly to any particular rate when it is confronted with a keen and vigor-

ous competitor. As to competitive business, all laws recognize tliat there can be no arbitrary hard and fast rule laid down.

We are proposing to do in this regard what can only be done if you are to establish a working system at all, that is, to vest in the commission in whom we would be presumed to have confidence, the discretion of fixing the rate to be allowed to be charged by a railway in respect to its competitive business. The competition arises immediately in our own country, and also from outside in many cases. It may arise from railroads of from any other kind of transportation ; but the competition existing and being made known to the commission, it becomes the duty and the power of the commission to say what rate may be made ; and, in order that there may be no improper restraint upon the operating of the railways and the arranging of their rates, in order that the business may not be blocked, we have a clause which allows the railway company, when it is applied to for a competitive rate, to give it without consultation with the board ; but it immediately notifies the board of the rate fixed, and, if, the board approves of it, it remains tihe rate as respects competitive business on that class of goods until some other conditions arise. We have endeavoured to provide in the Bill against any unnecessary hampering of the operations of the railroads, and to afford them every means of meeting urgent, pressing demands, as they may arise.

We are proposing to irnpuse somewhat heavy penalties on the railroads in case they violate the provisions of this law. In order that the public may be kept fully informed of the tariffs that are in operation, we impose a penalty on any. railway company which does not see that every station is supplied with adequate notices of what these rates are.

The classification of freight traffic is another subject. At present all freight classification is practically determined by the Governor in Council. The railways now meet in their associations for the purpose of determining business. They agree among themselves upon what they call a joint freight classification, which is applicable to all the railways unless some are specially excepted ; and under the existing law the Governor in Council may confirm or may refuse confirmation of this classification, and changes may have to be made to meet the views of the government. We propose to transfer that power from the Governor in Council to the railway commission.

We have made provisions which we trust and believe will be found useful in respect to foreign traffic, as to which a great many complicated questions arise. We have vested a very large discretion, I may say full discretion, in the commission, as respects the regulation of both traffic from foreign countries into and through Canada, and traffic from Canada into foreign countries. We have provisions which, if enforced, will compel railway companies which have connections with lines running into other countries, to make proper and regular arrangements with those lines, so that there may be some uniformity and equity in the rates imposed on that portion of the traffic which may be Canadian and on that portion which may be carried through Canadian territory.

We have thought a good deal on the question of the long and the short haul, a question which is fruitful of complaint and a very difficult one to solve. The provision which we have made covering that intricate and complicated problem is to leave the railway commission to deal with each case as it arises, save and except that we forbid tihe imposition of higher rates for the shorter distance as compared with the longer distance when the shorter is included in the longer ; and we only except from the general operation of that clause those instances in which it has been made to appear- '

Hon. Mr. HAGGAItT. Does that apply to foreign traffic ?

The long and the short haul question arises more especially in our own country.

Hon. Mr. HAGGART.

It arises principally in competition with foreign traffic. Suppose there is a shorter distance within our own territory as compared with the foreign traffic, would you apply the rule then ?

We cannot apply exactly the same rule, because we do not control the whole traffic. I have already stated that as respects traffic to and from foreign countries, we have given the board powers which, if they are exercised, would be found, I think, to ensure equitable rates and equitable connections between railroads that are carrying our produce and connecting with outside roads and roads carrrying into the country and connecting with inside roads. But in respect to the long and the short haul generally, we control all lines in our own country, and it is only there that we can legislate in respect to these matters.

Mr. BARKER.

Will this commission cover lake, canal and river navigation as well ?

Yes, we have clauses which embrace water communication. I think I have pretty well covered the important features of the Bill. I have gone into these matters perhaps at undue length. I have

not done so with a view of having a discussion upon the measure now. I know that such a discussion could not conveniently take place. The Bill will he in the hands of hon. members as speedily as it can possibly be supplied, and I hope at an early day to be able to move it to a second reading.

Mr. INGRAM.

Is it the intention to have this railway commission control or manage the government railways of Canada ?

It does not embrace the management of the Canadian government railways.

Mr. INGRAM.

That is to say, it would have no more to do with the government railways than with any other railway In the Dominion ?

Nothing more.

Mr. INGRAM.

Another question I would like to ask the hon. gentleman. Is it proposed that the classification of freights shall be in the hands of the commission, and that the railway associations which have heretofore classified the rates and the grades of freight subject to the approval of the Governor in Council shall not continue to do so without the approval of the commission ?

They do not classify the rates. They simply classify the freights.

Mr. INGRAM.

And they state what the rates shall be subject to the approval of the Governor in Council. What I want to know is whether it is the intention that the commission shall classify these rates and compel the railway companies to adopt them ?