The advantage gained is, to some extent, the purpose of the Bill- certainty. It will be an advantage to the railway man. If we aid a railway it is because we believe it will benefit the country, and we want, within reasonable limits, to help the contractor. Of course he is certain of his $3,200 a mile, but he desires also, within reasonable limits, to know what surplus subsidy he is entitled to. If he goes to the bank and says: This railway is going toi cost a sum which will entitle me to $(>,-400 a mile, and I want you to finance accordingly, the bank may say : It may be
that you will be entitled to that subsidy, but what guarantee have we of that 7 We have the guarantee of the $3,200, and you ask us to advance large sums on the theory that this road is to be a costly one, but we have no guarantee. So, the contractor says to the government: Make an estimate of
the cost and put me in such a position that 1 can tell the bank how much I am to get. That is a legitimate request. The engineer who is called upon to make bis estimate will bo aware that his estimate will be subject to comparison and examination when the road is finished, and that if it proves to be seriously wrong, he will be discredited. His natural tendency therefore, will be, in the first instance, to make a careful, safe, conservative estimate, for his own reputation
unless we assume that he is a man who wants to be dishonest. But, going on the fair assumption that he is a man who wants to do his duty, his tendency
will be to make a careful, safe, conservative estimate. Taking that, you then allow a margin by paying only 70 per cent of the estimated surplus subsidy. You have two checks which give a reasonable assurance that there will be no abuse. Abuse can follow from only one of two assumptions-either that the engineer is incompetent I'll making his estimate and that his errors more than counterbalance the margin of safety, and the other-which we need not assume-that he is dishonest and wishes to deceive the government. I think it will be found in practice that the engineer, for his own reputation, will make a moderate and careful estimate,, iuid I think that no cases will be found where the actual cost will be less than the engineer's estimate.
Perhaps the minister has the figures on that point. When I was in the department my attention was called to the fact that there were several. They did not ail get that amount by any means, but there have been several that have got it.
It might possibly work out that, whenever the cost had been overestimated the government would recover nothing, and when under estimated the contractor would put in a claim and say that, though he had no legal claim, yet, in all fairness he ought to be paid. .
Mr. R, L. BORDEN. I must say that I have not yet known of a contractor who was afraid of the word ' may ' or of any other. There is this to be observed also -that the surveys, plans, and profiles, I suppose, will not be made by the chief engineer, but will be furnished by the contractor.
It does not mean an additional subsidy to what they would otherwise receive. If they do not receive it now, they would receive it at the end of the | undertaking. But, if the road cost the sum fixed they would have no assurance in the meantime that they would receive it. They would have to speculate on the engineer's ultimate report. The effect is to reach a conclusion, with a margin for safety, at an earlier stage and to give the company the assurance at once.