Mr. INGRAM.

The hon. gentleman (Mr. Blair) says that this report was made in 1897-8 ?

Yes, I say that the paper I am reading from is dated May 1st, 1899, and the portion which I have been reading, referring to the condition of the locomotives and train service, is an extract from a report made in the financial year 1897-98.

Mr. INGRAM.

And I understood the hon. gentleman to say that during the year 1898 he purchased a large number of 20-ton cars.

No, no.

Mr. INGRAM, I understood the hon. gentleman to say that.

No, he wrote in 1897-98 that during the previous years there had been 20-ton cars purchased. He wrote that :

During the 'last eight or tea years we have purchased from 2,000 to 3,000 ears of 20 tons capacity which should have been of 30 tons.

Hon. Mr. HAGGART.

Would the hon. gentleman (Mr. Blair) be good enough to put that report on the Table of the House so that we will have an opportunity of looking at it.

I do not think I can put it on the Table exactly, but if the hon. gentleman would like to look at it I will let him have it in his own hands.

Hon. Mr. HAGGART.

I think it would be better when the hon. gentleman reads a report from a public officer that he should put it on the Table.

These are simply extracts from the report of this officer. I have not the whole of the report. I will let the hon. gentleman have it such as it is. Now, Mr. Chairman, just let me state the condition in an abbreviated form. So far as the equipment of the Intercolonial Railway is concerned, we had not a dining car on it. We had not a real first-class car on it. We had not a first-class sleeping car on the road, as everybody knows. Travelling on the Intercolonial over night, leaving our train and taking a car on the Canadian Pacific Railway or Grand Trunk Railway, the comparison which any person would make was open to comment and the subject of general remark. They had all the modern appliances and equipments; we had none of them. The first dining car that was put on the line was put on in 1898, or early in 1899, and so in regard to up to date coaches and sleeping cars. You have heard that we had no locomotives that were Hon. Mr. BLAIR.

capable of hauling more than 600 tons. I can give the committee a list showing when these locomotives were obtained, when they were purchased, how old they were and what the capacity was for hauling. You have the general statement of Mr. Joughins that these engines would not haul 500 tons and everybody who has gone over the Intercolonial Railway in times past noticed the character of the train service, and even down to this date, has seen more trains of perhaps 180, 200 and 300 tons hauled by locomotives than trains of a larger tonnage. One hundred and eighty, or 200 tons was more than the average of the whole tonnage of some of these' trains and yet large locomotives which will cost no more for running, although they cost a little more for fuel, would be able to haul five times that amount of tonnage up our grades without any difficulty whatever, and they are doing it to-day. The only thing that I regret is that we have not been able to get these large locomotives manufactured and put into service fast enough. We have not begun to realize the advantages which will accrue from the equiqment of the road with large locomotives, so that we are yet in no position to claim that we are fully and completely equipped.

We are spending, this year, $400,000 on capital account for rails. We must put down heavy rails to bring our road up to date. I think that is too obvious to need any argument to sustain it. We must have heavier trains, heavier locomotives and heavier cars, and the truest economy, as well as the safety and security of the travelling public, requires that we should have these heavy rails and that we should have tne bridges strengthened so that these trains may safely pass over our line. We have spent $200,000 within the last three years out of capital for the purpose of strengthening these bridges. I would have been better pleased and the road would have been better served if we had spent double or treble that amount during that time. It would have been better if the government had spent more than that for new rails and more rails, but I think hon. gentlemen would be inclined to assume that if it had been possible for the government to have authorized estimates for a larger sum they would have done so. If they had thought that parliament would have approved of larger estimates they would have so asked, but we must move cautiously and moderately in these things. We cannot do as company roads do, circulate their stock, get $20,000,000 at one time and do the things which are necessary. We must go to work in a more moderate way. The expenditures we have made in these years have been less than we would have liked to have made. The expenditure for sidings and accommodations has been very large and will amount up to this time, to about $2,000,000. Does anybody say

that with heavier trains and heavier locomotives we could get along without increased sidings ? I intend to have a memorandum of the exact number, of miles-there were scores of miles-which have been added to the railway in the way of additional sidings during the last two or three years. I will get the information if it can be obtained for me before we get through the discussion on the Intercolonial Railway votes. But, we have spent $2,000,000 for this purpose. Does anybody say that that expenditure was not necessary ? You had better pull up your rails and tear up your road and tell the people that you do not want a railway down there than run it in the twopenny, halfpenny way in which it was going on. If you are going to have a railway that is creditable to Canada you cannot move one peg without doing the whole work. You cannot have locomotives that will economically carry the freight unless you have heavier rails, longer sidings and larger cars. All these things follow in the train, one upon the other, just as naturally as day follows night, and the necessity is just as complete as it would be in any other condition. Now, then, I say that having increased the size of the car and the length of the train, in order that the road may be worked at all, we had to have, as rapidly as we could get them, increased length of sidings from one end to the other of the road. , ,

As to the expenditure at the Straits of Canso. nobody seems to have taken any objection to that. The little freight sheds that we had along the line with their limited accommodation ; the little stations and the little offices which did not suffice ; these had to be increased and multiplied, and during the last five years we have had to spend $1,000,000 in that work. Shall it be said that when people along the whole length of the Intercolonial Railway were crying out for reasonable facilities to enable them to do their business ; shall it be said that we should turn a deaf ear to their appeals because some one on the other side of the House is going to cry out : ' What an enormous expense,' and because some one on the opposite side claiming to represent his party, may say : This is a sinkhole for the money of the country. Sir, I do not think we would be worthy of the positions we occupy as responsible ministers of the Crown if we had yielded timidly to any such out-crv as that, and refused to give the people of Canada the accommodation which they demanded on the Intercolonial Railway. My business as the Minister of Railways is to present to my colleagues reasonable demands to meet the needs of the railway. As a matter of fact I have never approached this question in any spirit of extravagance, but on the contrary, I have always been behind the requirements of the road. And when I presented these claims, I must say that they have always been received in a

spirit of fairness and consideration by my colleagues. They were not, perhaps, met to the extent which I would have desired, but still they were met to an extent which I could see was as far as the government could reasonably go at the time and under the circumstances. Sir, I am prepared to justify, to justify in the face of the world, what we have done in order to make the Intercolonial Railway a railroad which is creditable to Canada to-day, and which if. we have not brought up to an absolute state of perfection at the present time, we hope to attain in the future. I would like to get a candid avowal from the gentlemen on the other side of the House who have gone over that road, as to what they think of the improvements we have made and the increased facilities which we have afforded. They certainly have told me individually that they much appreciate the improvements which have taken place. They have commended in no carping spirit the splendid and convenient service which -we have given to the people of the country. Let it be remembered that the Intercolonial Railway is not for the people of the maritime provinces alone ; let it not be forgotten that the commercial people of all Canada, and that the travelling public of all Canada are participants in the comforts and facilities which are afforded on that road. I am satisfied, for my part, that the people of the entire Dominion desired that the intercolonial Railway should be put in proper shape. Let me ask : What was the condition of the Canadian Pacific Railway before we entered on our era of improvement on the Intercolonial Railway ? Are there not gentlemen here who travelled over the Canadian Pacific Railway before we brought the Intercolonial Railway up to its present standard, and do they not know it to be a fact that the better quality of the service, and the greater comfort and the greater convenience which we inaugurated on the Intercolonial Railway stimulated the other road to our example. I think hon. members on both sides of the House will recognize that there is a place which a government railway can properly fill in every country ; it can be an example and a stimulus to other railway companies throughout the country to attain to the same high standard of service. And, Sir, if a government railroad does no other good than that, it does a very great deal for the benefit of the country.

I do not believe that under all the circumstances, the people of Canada will say that we have expended one dollar more on the Intercolonial Railway than we should have expended. I say that my hon. friend from Jacques Cartier (Mr. Monk) for instance, does not represent the people of Montreal or the people of his own district when he speaks in the contemptuous way he does of the Intercolonial Railway. He does not represent the ideas of the people when he treats the Intercolonial Railway as if it were

unworthy of serious consideration. I am quite sure that the people will not approve of what he has said in that regard, for X know that the citizens of Montreal are more than pleased with the results of our bringing the Intercolonial Railway to that city.

Now, Sir, I think I have proven that the expenditure on capital has been necessary and justifiable. But some people have said, as if it deserved serious attention at the hands of parliament : Oh, but you have

spent sums on capital account which ought to have been paid out of the earnings of the road. In other words, they declare that we have not adopted a system of book-keeping w'hich would commend itself to an expert chartered accountant. Now that may be all very well ; it may be a very nice argument to address lo a meeting of shareholders of any incorporated company, if these shareholders were raising the question as to whether the expenditure for the year was an expenditure that ought to be taken from earnings which would reduce the yearly dividends, or whether it ought to be included in bonds, and charged by way of bonded liability upon the undertaking, so that future shareholders would have to bear the charge, and the present shareholders would get a larger rate of interest. The shareholders in these incorporated companies change from year to year ; one set of men may be shareholders to-day and a different body of men would be shareholders in the next month, or in the next year, and the question raised by gentlemen on the other side in reference to the charging of the expenditure on the Intercolonial Railway would be a profitable one for consideration under such circumstances. But is that the situation with regard to the Intercolonial Railway ? I contend that it is not. The Intercolonial Railway belongs to the people of the country, and as such its owners are not in the same position as would be the shareholders in a joint stock corporation. The government lasts for ever ; though its personnel may change, yet it is always the government of Canada that is administering the Intercolonial Railway, and the people wTio own it are Canadians, whether they be the people who are living to-day or the people who will live years hence. It is the country that is concerned ; and it is not particularly a question of book-keeping for them.

I propose to show, Sir, that even if it were, there is nothing in the argument which lion, gentlemen opposite have advanced upon that point.

My first proposition is this, that if the need of making this expenditure is conceded in order to bring the road up to the condition to which we are bringing it, and in order that it may be still further improved, there is only one way in which it can be done, and that is by borrowing, or, in other words, on capital account-why ? Because the earnings of the road do not afford a sufficient margin. Even if they produced each year the largest surplus we ever had,

Hon. Mr. BLAIR.

that would only be a mere drop in the bucket for the purpose of reconstituting and reconstructing a great railway. How long would it be before we would put down new rails (.u the whole road if we had to take the cost of them out of earnings ? How long before we could put: down new sidings or provide new equipment if we had to wait until we could do so out of earnings ? It happens that this read has never been, and perhaps it never may be, a great surpluspaying road. Conditions exist which may for some years to come control the financial results of the undertaking. It would be unfair to hold the Intercolonial to the same strict rule to which you would hold railways which are built for commercial reasons, and in view of commercial considerations exclusively. I woader to what extent commercial considerations entered into the question of the location of the Intercolonial Railway. If we had been building a road to yield a handsome net return to the government every year from its earnings, who would undertake to build a road by the roundabout route which the Intercolonial Railway has taken V I do not suggest that it should not have taken that route. In the conditions of the country at the time, I think it was important that it should have done so, because the people in that portion of the country would otherwise not have had railway accommodation at all. But do not let it be asserted that because those conditions controlled the location of the route, for that reason the Intercolonial Railway ought to be despised and neglected, and left in the condition of a second or third-class road because, located where it is, it did not promise any large financial results and does not give any such results. I claim, therefore, that the position, so far as the question of improving the road out of capital or out of earnings is concerned, is exactly the same as respects its control by the country, and there is not one dollar of difference either to any individual in Canada or to the Finance Minister of Canada, in the result at the end of the year, whether you improve it out of earnings clout of capital. Would it not be fallacious and absurd for me to come down to parliament and ask for an appropriation of two or three or four millions out of earnings for the purpose of improving the road ? If I did so, who would be the first person in the House to condemn such a proposition ? My hon. friends opposite; and what would they say ? They would charge me with beinig guilty of a shallow pretense ; they would charge me with perpetrating a fraud on the parliament of Canada in asking for two or three or four millions out of the earnings of the road when it never had more than $122,000 of net surplus iu any year in its whole history. They would say, why do you not honestly and frankly tell the House and the country that you have not the earnings and do not expect

them, and that you intend to add to the debt of the country by taking this money out of the treasury, out of which it must necessarily come ? That is the attitude these gentlemen would take if the government laid estimates on the Table for an expenditure in that way. So that you can see at once that if the road is to be improved, and improved promptly, and improved by the expenditure of a large amount of money, then of necessity we must borrow the money in order to do it; and when I say that we must borrow the money, I make the statement upon the assumption that there would not necessarily be in the treasury of the country a sufficient amount, after all the other charges for the government service have been disposed of, to meet this charge. If there should be such a surplus then there would be no addition to the debt, and you would be in exactly the same position as if you had voted the money on account of earnings, and had spent it out of such appropriation. I do not think it is humanly possible for any individual to construct any theory or to advance any argument to show, granting my basic proposition, that the expenditure must be made, that one farthing of difference has been made in the financial condition of the country, or that the people have lost one dollar by reason of the particular way in which it has been made, that is to say, by asking an appropriation on capital account.

I hope that my argument upon that point has been made clear. If it has, then there is no substantial ground for criticism as to the expenditure-I do not say as to some of the minute details. I am not going to affirm for a moment that in a large expenditure of millions there may not have been some items in which the expenditure has been larger than it would have been if a closer scrutiny had been kept. I make that statement so as not to appear to make too broad a claim. But in the main, considering these exceptions, I say that assuming that the expenditure was a proper expenditure, it could only be made in this way; and, so far as I can discover, there is no earthly difference between making it in this way and making it in any other way that can be suggested-except this : The

ex-Minister of finance admitted what I am now stating. In the course of the discussions which have taken place on this question, he admitted that, as a matter of finance affecting the people of the country, or the treasury it did not make any difference ; but he said the difference comes in when we as a parliament are seeking to compare the character of your administration with the character of your predecessors'. The difference comes in, he said, when you want to put the two administrations side by side; you have expended sums of money out of capital which you might have spent instead out of any little surpluses you may have had, and have 108

therefore been able to show some little better results than you would have been able to do if you had followed the course pursued by your predecessors. Therefore, he said, for the purposes of comparison, the system of making the expenditure on capital account is not as defensible as the other system.

There is enough in that argument to justify one in taking a few moments of the time of the committee in order to examine it. You will observe that the proposition is based on two or three assumptions. You have to assume two or three things before you get the length of admitting that the argument is one of force or one that has any. application in the present case. You have to assume two or three very clear and explicit propositions, and I will tell you what they are. To be of any value for purposes of comparison, the first thing is that the conditions under which the comparison is to be made should be, if not absolutely identical, at all events approximately so. Is not that a fair argument to address to the committee ? Is it not fair to say that if you are going to make a comparison at all between this government and the last, then, for the purpose of supporting the statement that your expenditure has not been made under the proper heading, we have to show that the conditions of the expenditure during the period of the exMinister of Railways and the conditions during my period have been similar. Now, if you admit that, it will lead us into a moment's digression in order to see whether or not you can get the conditions alike by auy possible mode of straining or torturing of facts. I say you cannot. My hon. friend was pegging away on the Intercolonial Railway just sufficiently to keep it up so that it could run. No doubt the roadbed was good. There is no better roadbed in the country-solid and all that-very good as far it went. It was good for a locomotive of the size of 30 or 40 tons and to haul ISO or 200 tons, and to haul eight or nine cars at the outside. And if that was all right, my hon. friend was going along well enough. He was considerably out when we come to consider the question of economy, but economy was not sought for by my hon. friend. He took no practical method to secure economy. He was just peddling along in the same old way, and my hon. friend would have been content no doubt to have gone peddling along in the old way for fifty years if his government had only remained in office that long. But the country woke up, the country was aroused, and when I say the country, I mean the whole country. My hon. friend does not think probably that the maritime provinces, or even that portion of the province of Quebec which is traversed by the Intercolonial Railway is the country. But, supposing he is right in that view, I say that Ontario, which sends the largest part

of its traffic on the Intercolonial Railway clown to the maritime provinces-and everybody knows that Ontario furnishes us down there with almost all that we buy in the way of goods not manufactured in that country -is as deeply interested in the efficiency of the Intercolonial Railway as are the maritime provinces. There can be no doubt about that. And if my hon. friend were in my office and in receipt of the letters from the different manufacturers of Ontario which I daily receive, if he could read and hear their denunciations because we have not cars enough, or because we could not move freight and trains fast enough, and if my hon. friend from Jacques Cartier (Mr. Monk) could see these complaints, they would begin to think that there are other parts of Canada interested in the Intercolonial Railway outside of the maritime provinces and that portion of the province of Quebec which it traverses. Therefore, when I say the country, I mean the country as a whole, because the country as a whole is deeply interested. The conditions which existed when the country woke up and called for improvement on the Intercolonial Railway, were totally different from those which obtained during the years preceding. My hon. friend and his associates and colleagues, who have been attending the Public Accounts Committee, and spending no doubt sleepless nights in trying to figure out how many dollars were spent and how many tons of rails were laid down by the late government out of earnings, may take all the benefit they like out of the comparison. They will find that in no one year, during which my hon. friend (Mr. Haggart) administered the Intercolonial Railway, was there more than 3,000 to

5.000 tons of rails, laid down, whereas we have laid down 25,000 to 30,000 tons per year, and ought to lay down 50,000 tons per year, while the present generation or perhaps the children of the present generations are living, if we are ever to get the road properly equipped. I do not think there was any year in which my hon. friend put down as much as 5,000 tons of rails. In some years he put down 1,800 and in some 3,000 and in some 3,500. And there is no sense in making a comparison between an expenditure involving the laying down of 3,000 or 5,000 tons per year out of earnings and that involving the laying down of

25.000 to 30,000 tons per year. Are the conditions alike ? Can you put the one expenditure beside the other and draw any just or fair inference or make any just or fair comparison as between the two, in favour of my hou. friend's proposition ? I do not think you can.

But steel rails are not the only items. Take all the items right through. Take the item of new locomotives. We had to bestir ourselves, we had to be alive and try and accomplish something in our day. We had to buy 25 to 30 locomotives a year. We I Hon. Mr. BLAIR.

have not got them all yet, but are hoping to get them so that we will have them available for service during the year to come.

Mr. MONK.

By tender.

Yes, by tender. I am just going to break away for a moment to make an observation for the benefit of my hon. friend.

It will be lost on him.

I hope not. I know how deeply he felt, how full of regret he was, when he came to be informed that this government had, three or four years ago, gone over to the United States and got locomotives built there for the Intercolonial Railway. The picture which he presented when the enormity of such conduct came to his mind, was one which elicited from me a feeling of profound sympathy. I do not think that if he were the bitterest opponent of mine, I should wish to have him suffer the grief which then appeared to weigh him down, but it did strike me with some surprise that he should have been so grief-stricken for the first time. It did appear father singular that he had not given some evidence of his extreme regret that such a policy should have been tolerated by the country, when the government which he himself supported did exactly the same thing, and did it under conditions which did not make it necessary, as they did in our ease, for his friends to take that course. We have a report from the committee upon railway matters to which I can refer. I recollect my hon. friend complaining about the treatment that men who went before that committee received at its hands. He himself did not favour the committee with his presence, so far as I am aware, and how he came to be so impressed with the impropriety of the conduct of the majority of that committee, I do not know. He is very much concerned about all these matters, he is very anxious that information should be secured, yet my hon. friend was never present at any meeting of that committee which I have attended, and I have been present at all its meetings.

Mr. MONK.

You would not let us find out anything there.

My hon. friend was not there to try and find out anything. But he fires off his shots at long range. When he has any to fire he fires them through somebody else. I want to tell my hon. friend what took place in that Railway Committee, and if he had been present I have no doubt that he would have had to be carried out on a stretcher. It appears that there was a circular issued by one of the officials of the Intercolonial Railway stating that the

mechanical superintendent of the road had condemned the locomotives which were in use upon the government railway. My hon. friend who was conducting the examination (Mr. Haggart) called a witness all the way from Moncton for the purpose of giving an account of himself and verifying the report in that circular. Of course the inference was that in condemning the locomotives, the mechanical superintendent had condemned those which had been recently purchased by my department in the United States. That is the idea these gentlemen no doubt had in their minds, and which they thought, by bringing the mechanical superintendent of the railway to testify they would be able to establish to the satisfaction of the committee. He came, and my hon. friend questioned him. And what facts did he elicit ? He elicited the fact that this circular was erroneous in that it quoted him as making a statement that he had not made. He had never condemned the locomotives, but had said that they required to be adjusted in some minor particulars in order that they might steam to the best advantage, and he attributed the delay in trains to the fact that they had not been sent to the shops as they ought to have been. He was asked by my hon. friend what locomotives he referred to, and gave the numbers. I think they were 24, 28, 66 and 68. My hon. friend asked where did 24 and 28 come from, and the answer was that they came from the Kingston works. And when were they got. In 1894. So, you see, so far as two of these locomotives were concerned, these hon. gentlemen were not able to show, as they had expected, that they were locomotives which had been improperly bought and which were inefficient in working and unfit for the service. Where did the others come from ? They came from the Cooke Locomotive Works in the United States. And when were they bought ? They were bought in 1893.

Mr. MONK.

Will my hon. friend allow me to ask him a question ?

Yes.

Mr. MONK.

Was that not when we had no shops to build them ?

We will come to that in a moment, but, for the present-