Mr. A. SEVIGNY (Dorchester):
during the fifty year lease of the Grand Trunk Pacific, Canada will lose, every year 1617,570.46 if we take as a basis $223,514,092.98 as being the cost of the road up to the 1st January, 1923, when the Grand Trunk Pacific must begin to pay interest. And the total loss to the country, during the whole term of the lease, ensuing from the difference between the interest that we pay and the interest that we get, will be $30,878,523.
If the Grand Trunk Pacific do not earn 3 per cent over and above the working expenses from January 1st, 1923, to December 31st, 1925, they will be under no obligation to pay the government their 3 per cent rent during that same period, and consequently, they will have enjoyed the absolute possession of the road for a period of ten years without disbursing anything. But in this ease, the road will cost the country $244,239,884.28 and the difference between the interest to be paid afterwards at the rate of 3 per cent, and the three and a half per cent interest which we pay, will amount to $908,687 per year and represent a total loss to Canada of $45,433,000 for the term of the lease.
This is the way we own this road which . was to be ours, according to the reiterated promises of the Liberal politicians.
The present generation has made great sacrifices to build this line, and yet that generation will have vanished away before deriving the least advantage from the enormous expense it has incurred, and during fifty years from now on, it must comply with the desire and the will of the Grand Trunk Pacific Company.
The methods resorted to from beginning to end, by the late Administration, in this enterprise, are somewhat curious to examine.
Since the beginning of this debate, a few Liberal members have alluded to Mr. S. N. Parent, the ex-president of the Transcontinental, as being a great lawyer of the city of Quebec. Evidently, those gentlemen do know but very little about Mr. Parent as a lawyer; otherwise they would not have spoken as they have done. True it is that Mr. Parent is a lawyer, but true it is also that he never pleaded a single case and never was considered as a legal light in his province.
It may be well to recall under what circumstances the Liberal Government had entrusted to Mr. S. N. Parent the presidency of the Transcontinental. It was in 1905, and at Quebec, was being written a page of the history of the Liberal party which will surely not be considered as one
of its brightest. In fact, the great majority of the Liberal members of the Quebec Legislature had turned against their Prime Minister, who was the hon. S. N. Parent, and Sir Lomer Gouin and the hon. Adelard Turgeon were leading the movement. Those Liberal members had lost all confidence in the man who, so far, had been their chief. The Liberal party was in full revolt and refused to follow the direction of Mr. S. N. Parent any longer. Shall we ever know the reasons why Mr. Parent's followers had ceased to have confidence in him? However, the public has always been under the impression that the rebels of the time had serious grievances against their chief, and after all, the fact of having lost the confidence of his followers was nothing that could recommend him for such an important position as that of president of the Transcontinental. Setting decorum at defiance, Sir Wilfrid Laurier himself offered to Mr. S. N. Parent, the position of president of the Transcontinental commission, and he then and there declared that he was giving him the most desirable position at the disposal of his Government. Mr. Parent went to work and to understand the methods resorted to in order to build the line from Winnipeg to Moncton, a distance of 1,800 miles, is a real impossibility. That work was divided into twenty-one sections, all of which were very important. It is obvious that the Transcontinental commission, at the time, paid much attention to the big contractors, and in order to make things easier for them, it was decided that the contractors having no fortune, although they might have some talent, should be excluded from the offices of the Transcontinental, and here are the means which were used in order to obtain that result. It was said in the advertisements for tenders which were published in the papers, that those who wished to make a bid should comply with the following conditions:
And we do hereby declare and agree that in case of refusal or failure to execute the said contract with the commissioners, and also to furnish the approved security required, to an amount not exceeding one-third of the estimated total consideration of the contract, for the faithful performance of the said contract, within ten days after the acceptance of this tender the said cheque shall be forfeited to the said com-missionners to liquidate damages for such refusal or failure, and that all contract rights acquired by the acceptance of this tender shall be forfeited.
Those conditions were the surest means of turning out contractors who had no fortune. The commission reserved for itself the right to require from the contractors, as
a deposit, a sum of money equal to the amount of their tender, adding that if the contractor failed to make that deposit, they would have the right to forfeit the cheque representing the deposit, which he would send in with his tender. We shall more readily understand what this meant, when we know that, as to contract No. 1, the *Transcontinental commission reserved for itself the right to require a deposit of $327000, and if the contractor could not make it, the commission had the right to forfeit his $75,000 cheque which he had sent in with his tender, and thus it was with each of the twenty-one contracts. What was the result of such tactics? To have the whole con struction of the Transcontinental let to eleven contractors. And those eleven contractors have become the absolute masters of the former Transcontinental commission and also of the Liberal Government.
What was done by those eleven contractors, the favourites of the former commission? They sold all their contracts and realized profits varying from 10 to 30 per cent, and this, in many a case, before they had touched a shovel or a pick. Owing to the inqualifiable methods used in letting those contracts, these gentlemen have realized profits amounting to millions, and those who sustained losses were the subcontractors, who got no more protection than the public did get from the commission or from the Government.
I shall take this opportunity to submit to the House what has happened, to my personal knowledge, in the district extending eastward from the Quebec bridge, in the counties of Levis, Dorchester, Bellechasse and L'lslet. The main contract in this case had been let to Davis, under conditions which were quite irregular, as I shall prove further on. Davis had sold his contract to the Quebec Contracting Company, but it was thought among the public, generally, that the work was being executed directly by DaviSj and that is the reason why so many persons supplied goods to the Quebec Contracting Company, to the amount of thousands of dollars; they believed that Davis was responsible for the price of those goods. The Quebec Contracting Company was unable to fill the contract which it had got from Davis, and was wound up. This had a disastrous effect in all those counties; many a tradesman has lost important sums of money and the salaries of hundreds of workmen have remained unpaid. It will be noticed, however, as I shall prove a little further on, that in this enterprise, Mr. M.
P. Davis and Mr. J. T. Davis have realized enormous profits.
Another case is that of Messrs. M. Naud and Perreault. These gentlemen did some work on that section of the Transcontinental for which Davis had the contract and which extends westward from the Quebec bridge, a distance of fifty miles. Messrs. Davis had a sub-contract with Roberge and Chag-non, and these latter had let a sub-contract to Naud and Perreault. In filling that subcontract, Naud and Perreault made an excavation, under water, of 2,886 yards of solid rock, for which they were to get 75 cents per yard, whereas the price paid to Davis was $1.50 per yard. Naud gnd Perreault have filled their obligations, but Davis made a final settlement with his sub-contractors Roberge and Chagnon, unknown to Naud and Perreault, with the result that Naud and Perreault have not yet been paid the sum of $2,100 which is due to them since 1908. Roberge and Ohagnon are now in parts unknown and Davis has received big profits, whereas those who should have been paid first have not received anything so far.
The former commission never cared to protect the public, and in many a case the contractors have committed abuses on the properties crossed by the Transcontinental and have laughed at the farmers, at the tradesmen and at their workmen.
I say again that the Transcontinental commission, of which Mr. Parent was president, has shown exceptional kindness to the eleven big contractors with respect to the twenty-one contracts, and that if some detectives of the Burns agency had been called upon to watch what has been going on at the time, as they have done last winter at the Quebec Legislature, surely the detec-taphone would have revealed the true causes of that protection which was bestowed on some all-powerful contractors, and that we would have also an explanation of those fortunes which were amassed in so short a time by certain persons.
I wish to say a few words of what has happened as regards contract No. 8. This contract was for the construction of the Transcontinental on a distance of 150 miles eastward, from the Quebec bridge. As you see, this was a very important contract. The engineers of the Transcontinental say that they have handed to Mr. Parent himself the estimates of the Government for this con. tract before the tenders had been sent in. Did M. P. and J. T. Davis see those estimates after Mr. Parent had got them, in order to prepare their tenders? Here are the facts and I leave it to the House and to the public to draw their conclusions. The esti-
mate handed to Mr. Parent by the engineers contained no price for the wooden piers. Those estimates were remitted to Mr. Parent on the 23rd of January, 1907. The tenders were to be received on the 14th of February, 1907. After he had remitted to Mr. Parent, on the 23rd of January, 1907, the estimate which did not contain any price for the woodwork, the chief engineer noticed having forgotten something and he prepared a new estimate in which he included the woodwork (trestles, etc.); but he did not remit that estimate to Mr. Parent. The tenders were received on the 14th of February, 1907, and after a calculation of those tenders by the engineers, as was usually done, in order to ascertain who had the
lowest, the said engineers reached the
following result: Difference
Grand Trunk Pacific
Railway $5,078,334 77 M. P. & J. T. Davis. 5,105,389 24 $ 27,044 47O'Brien & Mullarkey Russell & Chambers 5,245,586 55 140,197 31Co 5,269,671 22 24,084 67Difference between highest and lowest tenders
The bid made by Davis was, consequently, $27,044.47 higher than that of the Grand Trunk Pacific, and the contract should have been awarded to the lowest bidder as the public interest demanded that it should be done.
Mr. Parent was there and then informed that the chief engineer had corrected, as it was his duty so to do, the first estimate given to Mr. Parent on the 23rd of January, 1907, that is, three weeks after the tenders had been sent in. Mr. Parent was not satisfied with that. It was then the 18th of February, 1907, the tenders had been opened and Mr. Parent knew their contents. He knew that Mr. Davis did not have the lowest tender; but the contract must be awarded to Davis. In order that this might be done, Mr. Parent ordered the chief engineer to stick to the estimate which had been handed to him by this latter on the 23rd of January and which was erroneous, and he had that estimate signed by the chief engineer, Mr. Lumsden, and by the assistant chief engineer, Mr. Macpherson, on the 18th of February, 1907.
As I have said, the tenders had been sent in on the 14th of February, 1907, but the figure was taken off the estimate signed on the 18th of February, 1907 by Lumsden and Macpherson, in such a way as to create the
belief that the estimate had been prepared on the 8th of February, that is, before the tenders had been received.
Had Mr. Parent shown Mr. Davis the estimate which had been handed to him by the chief engineer on the 23rd of January? He says in his deposition that he does not recollect having done so. One thing is certain and it is this: Davis got the contract by means of this estimate, and he could not have got it had the right estimate such as corrected, been taken as a basis.
This contract was awarded to M. P. and J. T. Davis for the price of $5,011,343.50, and up to the 31st December, only 80 per cent of the work had been done, and however, the work called for by this contract should have been completed by the 1st of September, 1908. On the 21st of December Davis had estimates to the amount of $6,341,855.99, or $1,330,609.40 more than implied by his contract.
This contract contained 103 items, and with respect to one only, that is, the item of the filling by train, Davis had estimates for 2,700,000 cubic yards. This item gave Davis 45 cents per yard according to his contract with the Transcontinental commission, and he had sold his contract to a sub-contractor who got 29 cents per cubic yard, which left a net profit of 16 cents per yard for M. P. Davis, who realized $432,000 net profit on this one item.
Here are a few of the prices which Davis got from the Government and paid to the
sub-contractors: Main Subcontractors. contractors.Item 4, solid rock $ 1 45 $ 1 26Item 5, loose rock ... . 65 42Item 6, common excavation 27 22Item 59, concrete 1-2-4... 15 00 11 00Item 62, concrete 1-3-5... 10 50 8 15Item 63, concrete 1-3-6... 10 00 7 60Item 74 c. train filling.... 45 29
As you see, it was important that this contract should be obtained, and it is probably for this reason that such serious irregularities as those above mentioned were indulged in without any hesitation, in order to favour a powerful friend. No doubt that, realizing such profits, Davis must have often repeated the words ' very decent,' ' very decent.'
Contract No. 8 is not the only one by means of which Davis has realized profits extraordinary and altogether unjustifiable. By means of contracts Nos. 16 and 17 he received many hundred thousands of dollars for which he did no work. Those contracts, Nos. 16 and 17, were awarded to M. P. and J. T. Davis on the 29th of
October, 1908, at prices much higher than those generally given by the Transcontinental Commission to the other contractors. The following list compares the prices awarded to Davis for those contracts, Nos. 16 and 17, with the prices awarded to the other contractors for work of the same nature on the Transcontinental:
Average price on other Prices paid, contracts.
1. Clearing $ 60 00 $ 50 003. Grubbing 175 00 145 004. Solid rock 1 90 1 605. Loose rock 85 606. Common excava- tion 43 297. Ex. in founda- tions 1 50 97S. Ex. in cofferdams 5 00 3 1210. Piles delivered. . . 40 28112. Sheet piling . . . . 80 00 57 0013. Sheet piling, Wake- field type .. .. 100 00 74 0015. Pole drains . . . . 75 5216. French stone drains 2 00 1 5217. Paving in culverts 7 00 4 0118. Crib filling . . . . 4 00 2 2419. Riprap, hand laid. 5 50 2 9820. Riprap, randim . . 4 00 1 9022. Round logs in cribs 40 26123. Cedar mudsills per M 50 00 40 5024. Framed trestles per M 90 00 52 0025. Caps, &c., per M. 90 00 51 4026. Ties and guard rails per M . . 90 00 50 7727. Stringers per M. . 90 00 62 0028. Cedar in culverts. 50 00 43 5029. Plank in crossings. 45 00 32 5030. Timber in culverts. 50 00 43 5030a. Timber in coffer- dams 60 00 44 0030b. Timber in cais- sons 100 00 66 4358. Concrete in 1-2.. . 30 00 16 4059. " 1-2-4 . 18 00 14 0060. " 1-3-5 . 17 50 13 0061. " 1-3-6 . 16 00 12 0061a. " 1-2-5 . 18 00 14 6062. " 1-3-5 in arch culverts . . 17 50 13 0063. Concrete in 1-3-6 in arch culverts . . 16 00 12 4264. Concrete in 1-3-6 in box culverts . . 16 00 11 5065. Concrete in 1-4-8 . 14 00 10 7566. " 1-4-8 in walls of build- ings 16 00 11 6867. Masonry, first class 25 00 17 0068. Masonry, second class 18 00 13 5069. Masonry, third class 16 00 10 3070. Masonry, dry.. . . 10 00 7 0071. Masonry, in arch rings 30 00 23 4076. Ties, first class. . 70 5177. Ties, second class.. 65 4678. Switch ties, per M 70 00 45 00
The work relating to contract No. 16 should have been completed on the 31st of December, 1910, and the work to be done according to contract No. 17 should have: been completed in March, 1911.
Several months after those contract? were signed, Messrs. Davis had not yet begun to work. Of this the president of the Grand Trunk Pacific complained bitterly in a letter addressed to Sir Wilfrid Laurier himself on the 2nd of August, 1909:
My dear Sir Wilfrid,-On the 29th day of October, 1908, the National Transcontinental Railway Commissioners awarded two contracts for the construction of about 204 miles on sections ' D * and * E ' of the National Transcontinental Railway. The first section starting on the west end of Fauquier Brothers' Abitibi contract, in the province of Ontario, about 100 miles west of Cochrane, for a distance of 104.24 miles; the second contract commencing at the termination of the first and joining Fauquier Brothers' contract north of Lake Nipigon, a distance of 100 miles. By the terms of these contracts the work was to commence immediately after the execution of the agreements to be proceeded with continuously and diligently under the personal supervision of the contractor until completed, the date of completion being December 31, 1910.
This work is remote from rail transportation, the closest point being 100 miles west of Cochrane. The prices at which the work was awarded were very high and consequently sufficient to allow contractors to build tote roads or some other means of transportation and getting in supplies so as to immediately commence work. To the best of our knowledge no attempt has been made as yet to open this work, and the indications are that while the work, as before stated, was let at very high prices on account of the difficulties of transportation, it is now the intention of the contractors to haul their material over a portion of the Fauquier Brothers' track work, on which will be completed the present season, say about 50 miles, and haul along right of way to their own section 50 miles distant. This delay will add largely to the profits of the contracts with no commensurate advantage so far as the National Transcontinental railway is concerned, and under the circumstances I will ask that the Government arrange for the cancellation of existing contracts and ask for new bids which can undoubtedly be obtained on very much reduced schedule prices, particularly so if it is known that the contractors will be enabled to haul their material and supplies over such portion of Fauquier Brothers' work as track has been laid up.
Yours very truly,