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REPORT Submitted to His Honour the Lieutenant-Governor by the Hon. Richard McBride, of the proceedings… British Columbia. Legislative Assembly 1907

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 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 1
REPORT
Submitted to His Honour the Lieutenant-Governor by the Hon. Richard McBride, of
the proceedings in Conference of the Representatives of Canada and of the
Provinces, at Ottawa, October, 1906.
By Command.
HENRY ESSON YOUNG,
Provincial Secretary.
Provincial Secretary's Office,
March 18th, 1907.
To the Honourable James Dunsmuir,
Lieutenant-Governor of British Columbia.
May it Please Your Honour :
I have the honour to report that, in response to the following invitation addressed to me
by the Right Hon. Sir Wilfrid Laurier, G. (3. M. G., on September 10th, 1906, I proceeded to
Ottawa for the purpose of attending a Conference of the Premiers of the Provinces of Canada
with the Dominion Government, to discuss the financial subsidies to the Provinces :—
"Ottawa, 10th September, 1906.
"Sir,—In accordance with the request of the Provincial Governments for a conference
with the Dominion Government to discuss the financial subsidies to the Provinces, I beg to
inform you that such a Conference will take place at the City of Ottawa, on Monday, the Sth
of October next, at eleven a. m., and you are invited to attend.
" Yours respectfully,
" The Honourable Richard McBride, " Wilfrid Laurier.
" Prime Minister, Victoria, B. C."
"Victoria, B. C, Sept. 18th, 1906.
"Sir,—I have the honour to acknowledge your communication of the 10th inst., stating
that a Conference will Lake place at the City of Ottawa on Monday, October 8th, at eleven a.m.,
between the Provincial and Dominion Governments, and extending me an invitation thereto,
which, on behalf of the Province, I most respectfully beg to accept.
" I have, etc.,
" Richard McBride.
" The Right Hon. Sir Wilfrid Laurier, P. <?., G. C. M. G.,
" Prime Minister, Ottawa."
The Conference was held in the Railway Committee Room of the Senate of Canada, at
eleven o'clock in the forenoon of Monday, October Sth, 1906, those present being as named in
the Minutes of such Conference hereto attached.
Impressed as I have always been with the fact that the topographical conditions of the
Province of British Columbia require to be considered in any attempt to equitably adjust the D 2 Inter-Provincial Conference, Ottawa. 1907
financial arrangements between the Province and the Dominion, I took every opportunity of
placing before the Conference the claims of British Columbia to more liberal treatment than
should otherwise be accorded were such exceptional conditions not present.
I succeeded in securing the record upon the Minutes of the said Conference of a resolution
admitting British Columbia's claim to special treatment, and although the amount suggested
as adequate by the other members of the Conference was, in my opinion, much less than I could
possible accede to, I deem this acknowledgment a valuable one in the interests of the Province
(vide resolution passed October 13th in Minutes of Conference, appended).
Permit me, Sir, to call your attention to the resolutions, and the preamble thereto, passed
on Tuesday, October 9th, and especially to the reservation contained in the latter of the right
of any Province to submit memoranda in writing concerning any claims to larger sums than
those agreed on at the Quebec Conference.
Such a memorandum, on behalf of British Columbia, was submitted by me immediately
after the passage of such resolutions. A copy of the same is herewith submitted, with the
Appendix thereto. In view of the fact that I had been instructed by Your Executive Council
to press for settlement of the claims of British Columbia to special treatment by arbitration
before an independent Commission, such a proposal was set out in the said memorandum (vide
Minutes of Conference October 10th. Sessional Paper No. 29a of House of Commons of
Canada, appended).
This proposal was submitted to the Dominion Government but was not accepted. Sir
Wilfrid Laurier, on its behalf saying :—I have been unable to reach the conclusion that the
appointment of such a Commission would be the best way of dealing with a question of this
kind" (vide Minutes of Conference October 12th. Sessional Paper No. 29a of House of
Commons of Canada, appended).
The Conference thereupon took the matter into consideration, and a resolution was passed
(vide Minute of Conference October 12th, appended) dissenting from the principle of such an
arbitration.    In the vote thereon British Columbia was the only non-content.
Forthwith I laid before the Conference the following declaration :—
" I protest that the question of British Columbia's claim upon the Dominion Government
for a reference should not be considered by this Conference, but that it is a question between
the Government of British Columbia and the Dominion Government." This was on Friday,
October 12 th.
This protest was not received with favour, and the Conference proceeded to discuss the
claims of British Columbia for exceptional treatment, and the amount considered equitable
therefor. This resulted in the introduction of a resolution (vide Minutes of Conference
October 12th, appended) suggesting an additional allowance of $100,000 per annum to British
Columbia for ten years.
I endeavoured, to the best of my ability, to show the total inadequacy of such a proposed
settlement, and submitted an alternative proposal as follows :—
That in case the proposed readjustment of subsidies, as set out in the Resolutions of the
Quebec Conference of Provincial Premiers, be accepted by the Dominion Government, there
shall be paid to the Province of British Columbia each and every year, in addition to the payments and subsidies otherwise provided, an amount understood to be what the Dominion of
Canada is willing to pay and the Province of British Columbia to receive as a nominal recognition of the disabilities borne by the Province owing to peculiar physicial conditions and from
other causes set forth in the case of British Columbia for Better Terms and accompanying
memorandum. 7 Ed. 7 Inter-Provincial Conference, Ottawa. t) 3
That the said annual amount shall be fixed in the following manner :—
One dollar per head of the population  until   the amount  reaches  $300,000, to  remain
fixed until the population is 400,000.
Seventy-five cents per head of the population thereafter until the amount reaches $400,000
per annum, to remain fixed until the population is 800,000.
Fifty cents per head of the population thereafter until the amount reaches $500,000, to
remain fixed until the population is 1,500,000.
Thirty-three and one-third cents per head of the population thereafter until the amount
reaches $600,000, to remain fixed until the population is 2,500,000.
Twenty-five cents per head of the population thereafter.
This not being received favourably, I finally withdrew from the Conference upon the introduction of an amendment to such resolution favouring an allowance of half the said amount to
the Provinces of Manitoba, Alberta and Saskatchewan.
From the said Minutes it appears the amendment last mentioned was lost and that the
resolution passed, all present voting content (vide Minutes of Conference October 13th,
appended).
Upon my withdrawal I again pressed upon the Conference the claims of British Columbia
to better treatment, by a communication addressed to the Chairman, the Hon. L. Gouin (vide
Minutes of Conference October 13th, appended). I regret to say it was ineffective, and I was
so informed by a reply from the Chairman (vide Minutes of Conference October 13th, appended).
I have the honour to submit that the acceptance of the terms proposed, even academically
as outlined in the resolutions mentioned, would not have been in the interests of the Province
and would have removed for many years, if not indefinitely, the chance of a just recognition
of such claims.
I have the honour to enclose copies of the Minutes of the Proceedings of the Conference
and of a Return thereon to the Dominion Parliament.
I have the honour to be,
Sir,
Your obedient servant,
RICHARD McBRIDE. D 4 Inter-Provincial Conference, Ottawa. 1907
MINUTES
Of  the    Proceedings  in    Conference   of  the   Representatives   of
Canada   and   of the   Provinces,   October,   1906.
CONFERENCE   CHAMBER.
Parliament House of Canada, Ottawa.
Monday, 8th October, 1906.
The following gentlemen met in the Railway Committee Room of the Senate of Canada,
at Ottawa, on Monday, the eighth day of October, 1906, at eleven o'clock in the forenoon, to
take part in a Conference convened by the Right Honourable Sir Wilfrid Laurier, Premier of
Canada, for the purpose of considering the financial subsidies to the Provinces.
Representing the Province of Ontario :
The Honourable J. P. Whitney, Prime Minister and President of the Executive Council;
The Honourable J. J. Foy, Attorney-General;
The Honourable A. J. Matheson, Provincial Treasurer.
Representing the Province of Quebec :
The Honourable Lomer Gouin, Prime Minister and Attorney-General;
The Honourable Adelard Turgeon, Minister of Lands and Forests;
The Honourable W. A. Weir, Minister of Public Works and Labour.
Representing the Province of New Brunswick:
The Honourable L. J. Tweedie, Prime Minister and Provincial Secretary;
The Honourable Wm. Pugsley, Attorney General and President of the Executive Council.
Representing the Province of Prince Edward Island:
The Honourable Arthur Peters, Prime Minister and Attorney-General;
The Honourable George E. Hughes.
Representing the Province of Manitoba :
The Honourable R, P. Roblin, Prime Minister, Minister of Railways and Minister of
Agriculture;
The Honourable Colin Campbell, Attorney General.
Representing the Province of British Columbia :
The Honourable Richard McBride, Prime Minister and Minister of Mines.
Representing the Province of Saskatchewan :
The Honourable Walter Scott, Prime Minister and Minister of Public Works ;
The Honourable J. A. Calder, Commissioner of Education.
Representing the Province of Alberta :
The Honourable A. C. Rutherford, Prime Minister and Provincial Treasurer;
The Honourable C. W. Cross, Attorney-General. 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 5
There were also present the following members of the Government of the Dominion of
Canada:
The Right Honourable Sir Wilfrid Laurier, Prime Minister and President of the
Executive Council;
The Honourable W. S. Fielding, Minister of Finance ;
The Honourable A. B. Aylsworth, Minister of Justice ;
The Honourable Rodolphe Lemieux, Postmaster-General.
On the Conference being called to order, it was moved by the Honourable Mr. Whitney,
seconded by the Honourable Mr. Roblin :—
That the Honourable Mr. Gouin be appointed Chairman of the Conference.
And the question of concurrence being put thereon, the same was resolved in the
affirmative.
It was moved by the Honourable Mr. Tweedie, seconded by the Honourable Mr. Peters :
That Mr. Charles Lanctot, K. C, Assistant Attorney-General of Quebec, be Secretary of
the Conference.
And the question of concurrence being put thereon, the same was resolved in the
affirmative.
The Right Honourable Sir Wilfrid Laurier welcomed the Delegates to the Capital.
It was then resolved that the Representatives of the Provinces should meet the Representatives of the Dominion of Canada on Thursday, the ninth day of October, 1906, at eleven
o'clock in the forenoon, for the purpose of considering with them the claims of the Provinces
in regard to increased subsidies from the Federal Government and an allowance to cover the
costs of administration of criminal justice.
After the departure of the Representatives of the Dominion of Canada, a debate arose on
the Resolutions adopted at the Conference held at Quebec, from the eighteenth to the
twentieth day of December, 1902.
And the hour of one o'clock in the afternoon ensuing, the Chairman declared the Conference continued until three o'clock in the afternoon.
The Chairman took the chair at three o'clock in the afternoon, when the members were
convened.
The Conference resumed the debate on the Resolutions adopted at the Conference held at
Quebec, from the eighteenth to the twentieth day of December, 1902.
It was then resolved that a committee composed of the Chairman and of the Honourable
Messrs. Foy, Murray, Pugsley, McBride, Campbell and Weir be appointed to prepare a
resolution embodying the views of the members of the Conference on the subject matter of the
above-mentioned Resolutions.
And the Chairman declared the Conference adjourned until the ninth day of October,
1906, at ten o'clock in the forenoon.
Charles Lanctot,
Secretary.
Tuesday, 9th October,  1906.
The Chairman took the chair at ten o'clock in the forenoon, when the members were
convened,
Were also present, in addition to the above named representatives of the Provinces :—
The Honourable G. H. Murray, Prime Minister and Provincial Secretary ; and—
The Honourable Arthur Drysdale, Attorney-General,
Both representing the Province of Nova Scotia.
The Committee formed for the purpose of preparing a resolution embodying the views of
the members of the Conference on the subject matter of the Resolutions adopted at Quebec in
December, 1902, reported a resolution.
And a debate arising thereon, the Chairman, at one o'clock in the afternoon, declared the
Conference continued until three o'clock. D 6 Inter-Provincial Conference, Ottawa. 1907
The Chairman took the Chair at three o'clock in the afternoon, when the members were
convened.
The Conference resumed the debate on the report of the committee charged with the
preparation of the resolutions embodying the views of the Conference on the Resolutions of
1902.
And it was moved by the Honourable Mr. Roblin, seconded by the Honourable Mr.
Peters, that the said report be adopted, and it was unanimously adopted as follows :—
Whereas the Members of this Conference are of opinion that it is desirable, in the interest
of the people of Canada, and essential to the development of the Provinces, that an immediate
provision be made for an increase of the subsidies granted by the Dominion to the several
Provinces, and for the award to the Provincial Governments by Canada of an amount sufficient
to meet the costs of the administration of criminal justice, not exceeding twenty cents per head
of the population;
Therefore, it is unanimously—
Resolved 1.—That the subject matter of the Resolutions adopted by the Conference of the
Representatives of the several Provinces held at Quebec, in December, 1902, and which were
shortly thereafter presented to the Government of the Dominion, and which were ratified by
the Legislatures of the then existing Provinces except that of British Columbia, be now
pressed upon the Government of the Dominion for immediate and favourable action, under
reserve of the right of any Province to now submit to such Government memoranda in writing
concerning any claims it may have to larger sums than those set out in the said Resolutions,
or to additional consideration or recognition.
Resolved 2.—That in case of the Government of Canada concurring in the views of the
Conference as expressed in the above Resolution, a measure should be submitted to the Parliament of Canada at the next session providing for payment of such increased subsidies and
allowances as may be determined upon, pending an amendment of the British North America
Act, if such amendment should be deemed necessary.
It was moved by the Honourable Mr. Tweedie, seconded by the Honourable Mr. Roblin,
that sub-section (C) of Resolution No. 1 adopted at the Conference held at Quebec in December, 1902, be amended, and it was unanimously resolved that it be amended so as to read as
follows :—
(C) The population as ascertained by the last decennial census to govern, except as to
British Columbia, Manitoba, Saskatchewan and Alberta; and as to these four Provinces, the
population to be taken to be that upon which, under the respective statutes in that behalf, the
annual payments now made to them respectively by the Dominion are fixed until the actual
population is by the census ascertained to be greater ; and thereafter the actual population so
ascertained to govern.
It was moved by the Honourable Mr. Murray, seconded by the Honourable Mr. Roblin,
and unanimously resolved :
That the Honourable Mr. Gouin, Premier of the Province of Quebec, and the Honourable
Mr. Whitney, Premier of the Province of Ontario, be a committee to submit the foregoing
Resolutions to the Government of the Dominion of Canada.
And at the hour of half past five o'clock, the Chairman declared the Conference adjourned
until the tenth day of October, 1906, at eleven o'clock in the forenoon.
Charles Lanctot,
Secretary.
Wednesday, 10th October, 1906.
The Chairman took the chair at half past ten o'clock in the forenoon, when the members
were convened.
The minutes of the meetings of Monday, the eighth, and of Tuesday, the ninth day of
October, 1906, were read and confirmed.
The Chairman read the extracts of the minutes of the deliberations of the Conference to
be submitted by the Honourable Messrs. Gouin and Whitney to the Representatives of the
Government of the Dominion of Canada, as follows :— 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 7
Extracts from the deliberations of a sitting of the Conference of the Representatives of the
several Provinces of Canada, held at Ottawa on the 9th of October, 1906.
Were present :
For Ontario :
Hon. J. P. Whitney, Prime Minister and President of the Executive Council;
Hon. J. J. Foy, Attorney-General;
Hon. A. J. Matheson, Provincial Treasurer.
For Quebec :
Hon. Lomer Gouin, Prime Minister and Attorney-General;
Hon. Adelard Turgeon, Minister of Lands and Forests ;
Hon. W. A. Weir, Minister of Public Works and Labour.
For Nova Scotia :
Hon. G. H. Murray, Prime Minister and Provincial Secretary ;
Hon. Arthur Drysdale, Attorney-General.
For New Brunswick :
Hon. L. J. Tweedie, Prime Minister and Provincial Secretary ;
Hon. Wm. Pugsley, Attorney-General and President of the Executive Council.
For Prince Edward Island :
Hon. Arthur Peters, Prime Minister and Attorney-General;
Hon. George E. Hughes.
For Manitoba :
Hon. R. P. Roblin, Prime Minister, Minister of Railways and Minister of Agriculture ;
Hon. Colin Campbell, Attorney-General.
For British Columbia ;
Hon. Richard McBride, Prime Minister and Minister of Mines.
For Saskatchewan :
Hon. Walter Scott, Prime Minister and Minister of Public Works ;
Hon. J. A. Oalder, Commissioner of Education.
For A Iberta :
Hon. A. C. Rutherford, Prime Minister and Provincial Treasurer;
Hon. C. W. Cross, Attorney-General.
******
" Whereas the Members of this Conference are of opinion that it is desirable in the
interest of the people of Canada and essential to the development of the Provinces that an
immediate provision be made for an increase of the subsidies granted by the Dominion to the
several Provinces and for the award to the Provincial Governments by Canada of an amount
sufficient to meet the costs of the administration of criminal justice, not exceeding twenty
cents per head of the population;
" Therefore it is unanimously—
"Resolved 1.—That the subject matter of the Resolutions adopted by the Conference of
the Representatives of the several Provinces held at Quebec in December, 1902, and which
were shortly thereafter presented to the Government of the Dominion and which were ratified
by the Legislatures of the then existing Provinces except that of British Columbia, be now
pressed upon the Government of the Dominion for immediate and favourable action, under
reserve of the right of any Province to now submit to such Government memorauda in writing
concerning any claims it may have to larger sums than those set out in the said Resolutions,
or to additional consideration or recognition. D 8 Inter-Provincial Conference, Ottawa. 1907
" Resolved 2.—That in case of the Government of Canada concurring in the views of the
Conference as expressed in the above resolution, a measure should be submitted to the
Parliament of Canada at the next session providing for payment of such increased subsidies and allowances as may be determined upon, pending  an  amendment  of the British
North America Act, if such amendment should be deemed necessary.
******
" It is also unanimously—
" Resolved.—That sub-section (C) of Resolution No. 1 adopted at the Conference held at
Quebec in December, 1902, be amended so as to read as follows :
" (C) The population as ascertained by the last decennial census to govern, except as to
British Columbia, Manitoba, Saskatchewan and Alberta ; and as to these four Provinces, the
population to be taken to be that upon which, under the respective statutes in that behalf, the
annual payments now made to them respectively by the Dominion are fixed until the actual
population is by the census ascertained to be greater; and thereafter the actual population so
ascertained to govern.
******
" It is also unanimously—
"Resolved.—That the Honourable Mr. Gouin, Premier of the Province of Quebec, and
the Honourable Mr. Whitney, Premier of the Province of Ontario, be a committee to submit
the foregoing Resolution to the Government of the Dominion of Canada.
" (True Extracts),
" Charles Lanctot,
"Secretary of the Conference."
The above extracts were unanimously agreed to.
The Chairman declared the sitting of the Conference suspended in order to allow the
members to meet the Representatives of the Government of the Dominion of Canada.*
And after the meeting with the Representatives of the Government of the Dominion of
Canada, the Chairman took the chair at half past twelve o'clock in the afternoon, when the
members were convened.
The Conference considered the observations made by the Representatives of the Government of the Dominion of Canada at the Joint Conference held on the forenoon of the tenth
day of October, 1906.
At the hour of one o'clock in the afternoon ensuing, the Chairman declared the Conference
continued until three o'clock.
The Chairman took the chair at three o'clock in the afternoon, when the members were
convened.
The Conference resumed the consideration of the observations made by the Representatives of the Government of the Dominion of Canada at the Joint Conference held in the
forenoon of the 10th day of October, 1906.
And the consideration of these observations being suspended, the Honourable Mr,
McBride submitted the following telegram :
"Vancouver, B. C, Oct. 10, 1906.
" Premier Richard McBride, Ottawa.
" At general meeting ninth October, resolved that Vancouver Board of Trade, impressed
with the urgent desirability of having a general bankruptcy law for the Dominion, has the
honour to request that Premier McBride may introduce the matter to attention of the
Premiers Conference assembled, and endeavour to obtain their co-operation in urging the
enactment of such legislation by the Federal Government.
" Wm. Skeene, Sec'y."
It was resolved that the subject-matter of the above telegram not coming within the
scope of the Conference, it could adopt no recommendation concerning it.
* The memoranda submitted on behalf of the Provinces of Ontario and of British Columbia in
pursuance of the above resolution are reproduced at length in the Minutes of the Proceedings between
members of the Government of Canada and of the various Provincial governments printed as Sessional
Paper No. 29a of the House of Commons of Canada during the session 1906-1907. 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 9
And the hour of half past five o'clock  ensuing, the Chairman declared the Conference
adjourned until the eleventh day of October, 1906.
Charles Lanctot,
Secretary.
Thursday, 11th October, 1906.
The Chairman took the chair at three o'clock in the afternoon, when the members were
convened.
The Conference considered the observations made by the Representatives of the Government of the Dominion of Canada at the sittings of the Joint Conference held on the tenth and
eleventh days of October, 1906.
And the hour of half past four o'clock ensuing, the Chairman declared the Conference
suspended for thirty minutes.
At five o'clock in the afternoon the Chairman took the chair, when the members were
convened.
The Conference resumed the consideration of the observations made by the Representatives of the Government of the Dominion of Canada at the above-mentioned sittings of the
Joint Conference, and other matters of provincial interest.
And it was moved by the Honourable Mr. Whitney, seconded by the Honourable Mr.
Roblin, and resolved :
That the Honourable Messrs. Foy, Campbell and Cross be a committee to prepare a
resolution with respect to the granting by the Federal authorities of charters to companies
with purely provincial objects.
And the hour of half past five o'clock ensuing, the Chairman declared the Conference
adjourned until the twelfth day of October, 1906, at ten o'clock in the forenoon.
Charles Lanctot,
Secretary.
Friday,  12th October,  1906.
The Chairman took the chair at ten o'clock in the forenoon, when the members were
convened.
The Conference took into consideration the claim of British Columbia to exceptional
treatment with regard to additional subsidies.
The Chairman, at forty-five minutes after eleven o'clock in the forenoon, declared the
Conference suspended in order to meet the Representatives of the Government of the Dominion
of Canada in Joint Conference.
The Chairman took the chair at twelve o'clock, noon, when the members  were convened.
The Conference resumed the consideration of the claim of British Columbia to exceptional
treatment, and further consideration of the same was postponed.
And the hour of one o'clock ensuing, the Chairman declared the Conference suspended
until three o'clock in the afternoon.
The Chairman took the chair at three o'clock in the afternoon, when the members were
convened.
The consideration of the claim of British Columbia for exceptional treatment was
resumed.
And after debate—
It was moved by the Honourable Mr. Murray, seconded by the Honourable Mr. Weir :
That in the opinion of the Conference it is inadvisable that the claim, in the way of
subsidies, of any Province be referred to arbitration.
And the Conference dividing upon this question, the names of the Provinces were taken
down as follows : D 10 Inter-Provincial Conference, Ottawa. 1907
Contents
Ontario	
Quebec	
Nova Scotia	
New Brunswick	
Prince Edward Island
Manitoba	
Saskatchewan	
Alberta	
Total      8
Non-contents
British Columbia      1
Total ,      1
So it passed in the affirmative.
The Honourable Mr. McBride then laid before the Conference the following declaration :—
" I protest that the question of British Columbia's claim upon the Dominion Government
for a reference should not be considered by this Conference, but that it is a question between
the Government of British Columbia and the Dominion Government."
It was moved by the Honourable Mr. Whitney, seconded by the Honourable Mr.
Murray :—
That in view of the large area, geographical position and very exceptional physical
features of the Province of British Columbia, it is the opinion of this Conference that the said
Province should receive a reasonable additional allowance for the purposes of civil government,
in excess of the provisions made in the Quebec Resolutions of 1902, and that such additional
allowance should be to the extent of one hundred thousand dollars annually for ten years.
A debate was had thereon.
And the hour of five o'clock in the afternoon ensuing, the Chairman declared the Conference adjourned until the thirteenth day of October, 1906, at ten in the forenoon.
Charles Lanctot,
Secretary.
Saturday,  13th October, 1906.
The Chairman took the chair at ten o'clock in the forenoon, when the members were
convened.
The minutes of the meetings of Wednesday, the tenth, Thursday the eleventh, and Friday,
the twelfth day of October, 1906, were read and confirmed.
The Conference resumed consideration of the motion of the Honourable Mr. Whitney
respecting the claim of British Columbia for exceptional treatment.
And after debate—
It was moved in amendment by the Honourable Mr. Scott, seconded by the Honourable
Mr. Rutherford :—
That the following words be added to the Honourable Mr. Whitney's motion respecting
exceptional treatment to British Columbia :
" In view of the very exceptional conditions of settlement existing in the Provinces of
Manitoba, Alberta and Saskatchewan, each of the said Provinces should be granted, for a
period of ten years, an allowance of fifty thousand dollars per annum in excess of the subsidies
provided by the Quebec Resolutions of 1902, as amended."
At this stage, the Honourable Mr. McBride withdrew from the further proceedings of
the Conference.
And the Conference dividing on the above amendment, it was lost on division.
The question then being put on the Honourable Mr. Whitney's motion, the Conference
divided, and the names of the Provinces were taken down as follows : 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 11
Contents.
Ontario	
Quebec	
Nova Scotia	
New Brunswick	
Prince Edward Island.
Manitoba	
Saskatchewan	
Alberta	
Total      8
Non-Contents.
None.
So it passed in the affirmative.
And after further debate—
The Chairman, at half past twelve in the afternoon, declared the Conference suspended in
order to allow the members to meet the Representatives of the Government of the Dominion
of Canada.
The Chairman took the chair at half past two o'clock in the afternoon, when the members
were convened.
The Chairman laid before the Conference the following letter received from the Honourable Mr. McBride :—
"Ottawa, October 13th,  1906.
" Honble. L.  Gouin,
" Chairman Inter-Provincial Conference, Ottawa.
" Sir,—In view of the critical stage reached in the negotiations in respect to the additional allowance claimed by British Columbia, I desire to place my position clearly and explicitly on record.
" There are three main phases of the case of the Province determining the attitude of its
government, to which I wish particularly to direct the attention of the members of this
Conference:
" 1. British Columbia did not secure as favourable terms upon entering Confederation as
subsequent events have shown it was entitled to have obtained.
" 2. The Province, by reason of its peculiar circumstances, has contributed, and still
continues to contribute, per head, enormously in excess of the average of the rest of the
Dominion to the Federal Treasury.
"3. Owing to the physical conditions of British Columbia, the average cost of administration per capita has, for a period covering thirty years, been shown to be five times that of
the other Provinces. The physical conditions to which I refer either do not exist at all in the
other Provinces or not by any means in the same degree.
" There has been no attempt made to dispute the facts of our case, and I hold that our
contentions are incontrovertible. I cannot, therefore, be expected to forego the pressing of
claims founded upon such facts, for the sole purpose of arriving at unanimity and harmony in
this Conference, however desirable in itself the latter may be. Even were I disposed to make
the sacrifice, the people of the Province would not exonerate me.
" I take the position that if the members of this Conference recognize the claims of British
Columbia for special consideration they are morally bound to give them their support. If, on
the other hand, they do not admit their validity, it is, I admit, equally incumbent in their case
to assist in having our claims investigated before a competent and independent tribunal. Out-
contentions are sound or they are not sound. With this in view, I have insisted upon a formal
declaration of the attitude of this Conference being placed on record before proceeding with a
discussion of the terms I have proposed.
" As to the terms of the settlement in respect to additional allowance, there is no exact
mathematical basis upon which to proceed. I have endeavoured, however, to come to a just
conclusion as to what should be a fair compensation for our special conditions and circumstances. D 12 Inter-Provincial Conference, Ottawa. 1907
'■ The underlying principle I have kept in mind in respect to our physical disabilities,
which is our main claim for compensation, is that the allowance should not be based on population alone, but also upon the cost of administration per head of the population. It is
obviously very much cheaper to administer a small, compact area with a large population, than
to administer a larger, broken area with a scattered population.
" The disparity under this head in the case of British Columbia is so great that no general
allowance considered adequate for the other Provinces can uniformly and justly apply to its
conditions.
" Our disabilities are of a permanent character and can never be overcome. Therefore,
the additional allowance for this condition must, if admitted at all, remain as permanent as
the disabilities are.
" It is true that with the increase of our population, the relative cost per head may, and
probably will, slightly decrease in time, but while the ratio of disparity may alter, the general
condition will always remain.
" Moreover, our requirements for developments in the immediate future, and by reason of
sparse population, are per head greater than they will be after some time to come.
" Consideration also must be had for the disabilities and conditions of the past as well as
for those of the future.
" Therefore, the proposal I have submitted, as to amounts asked, has been framed on a
sliding scale which conforms to the principles we have laid down. It applies, so to speak,
automatically, or as nearly so as we conceive it should apply.
" I wish to state here in all earnestness that I cannot depart from those principles in any
settlement we may make in respect to our special claims. I am not bound to the exact letter
of our demands, and am willing to go as far as possible, consistent with our general position,
to meet the wishes of my confreres on this occasion ; but, unless the members of this Conference are prepared to go much farther in my direction than they have done, it is useless to
discuss such an arrangement as is contained in the resolution of to-day, and I had no other
alternative other than to protest and to retire, declining to take further part in the proceedings.
" No one has been more anxious than I am to reach a conclusion that will be unanimous.
I have done the utmost, in the interest of our common cause, to bring about such a result.
" I have the honour to be,
" Sir,
" Faithfully yours,
" Richard McBride."
After debate it was resolved that the Chairman answer the Honourable Mr. McBride's
letter as follows :—
Honourable Richard McBride,
Prime Minister of British Columbia.
Dear Sir,—I am instructed by the Inter-Provincial Conference to acknowledge the receipt
of your letter of the 13th instant, setting forth the position assumed by you towards it, and,
in answer, to state as follows :—
The resolution to which you refer and which was adopted on the day you addressed your
letter to me, reads thus :—
" That in view of the large area, geographical position and very exceptional physical
features of the Province of British Columbia, it is the opinion of this Conference that the said
Province should receive a reasonable additional allowance for the purposes of civil government
in excess of the provisions made in the Quebec Resolutions of 1902, and that such additional
allowance should be to the extent of one hundred thousand dollars annually for ten years."
This resolution shows distinctly that the Conference recognised the claim of British
Columbia for exceptional treatment. I am specially directed to add that it was passed after
all the data presented by you had been fully considered.
I have the honour to be,
Sir,
Yours respectfully,
Lomer Gouin,
Chairman of the Conference. 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 13
And at three o'clock the Chairman declared the Conference suspended in order to allow
the members to meet the Representatives of the Government of the Dominion of Canada in
Joint Conference.
The Chairman took the chair at forty-five minutes after four o'clock in the afternoon,
when the members were convened.
After debate—
It was proposed by the Honourable Mr. Roblin, seconded by the Honourable Mr. Peters :—
That, as a result of the deliberations of the Conference with the Representatives of the
Government of the Dominion of Canada :—
1. The Conference recommends to each Legislature to abolish the special tax on commercial travellers, provided that this recommendation do not apply to any licence payable
under any Act concerning the sale of intoxicating liquors.
2. The Conference also recommends that the Legislature of the several Provinces shall
make no discrimination in the taxation of companies incorporated by the Dominion and
companies incorporated by the Province wherein such tax is imposed.
And the question being put, it was resolved in the affirmative.
As to the second part of the above resolution, the Honourable Mr. Whitney and the
Honourable Mr. Murray state that they desire to consult with their colleagues before giving
their assent.
It was then moved by the Honourable Mr. Whitney, seconded by the Honourable Mr.
Rutherford :—
That the members of this Conference place on record their hearty appreciation of the
attention shown them by the Prime Minister of Canada and his Colleagues, and of their efforts
to facilitate the work of the Conference.
And the question being put, it was unanimously resolved in the affirmative.
It was then moved by the Honourable Mr. Pugsley, seconded by the Honourable Mr.
Peters :—
That the thanks of the Conference be extended to the Honourable Mr. Gouin for the
satisfactory manner in which he has presided over its deliberations.
And the question being put, it was unanimously resolved in the affirmative.
It was then moved by the Honourable Mr. Roblin, seconded by the Honourable Mr.
Whitney:—
That the thanks of the Conference be extended to Mr. Charles Lanctot for the satisfactory
manner in which he has acted as its secretary.
And the question being put, it was unanimously resolved in the affirmative.
It was then unanimously resolved : —
That a meeting of the Prime Ministers of the several Provinces of Canada be held each
year to consider matters of common interest; and that every such meeting be convened by the
Prime Minister of the Province of Ontario and the Prime Minister of the Province of Quebec.
A draft of the minutes of the proceedings of the sitting of Saturday, the thirteenth day of
October, 1906, was read and approved.
And at the hour of six o'clock, the Conference declared its sittings closed.
Charles Lanctot,
Secretary/. D 14 Inter-Provincial Conference, Ottawa. 1907
RETURN.
(Dominion Sessional Paper No. 29A.)
■:oc-
Minutes of the Proceedings in Conference between Members of
the Government of Canada and of the various Provincial
Governments, assembled at Ottawa. October, 1906.
Conference Chamber, Houses of Parliament,
Ottawa, October 8th, 1906.
In response to an invitation addressed by the Right Hon. Sir Wilfrid Laurier, G.C.M.G.,
to the several Provincial Premiers throughout the Dominion, which invitation was couched in
these terms :—
"Ottawa, September 10th, 1906.
" Sir,—In accordance with the request of the Provincial Governments for a conference
with the Dominion Government to discuss the financial subsidies to the Provinces, I beg to
inform you that such a conference will take place at the city of Ottawa on Monday, the Sth of
October next, at eleven a.m., which you are invited to attend.
" Your obedient servant,
" Wilfrid Laurier,"
the following gentlemen assembled at the Conference Chamber in the Parliament Buildings at
Ottawa, on Monday, the 8th day of October, 1906, at the hour of 11 o'clock in the forenoon:—
From the Province of Ontario :
Hon. J. P. Whitney, Premier.
Hon. J. J. Foy, K.C., Attorney-General.
Hon. A. J. Matheson, Provincial Treasurer.
From the Province of Quebec :
Hon. Lomer Gouin, K.C., Premier and Attorney-General.
Hon. W. A. Weir, Minister of Public Works.
From the Province of New Brunswick :
Hon. L. J. Tweedie, Premier and Provincial Secretary.
Hon. William Pugsley, K.C., Attorney-General.
From the Province of Prince Edward Island:
Hon. Arthur Peters, K.C., Premier and Attorney-General.
Hon. G. E. Hughes.
From the Province of Manitoba :
Hon. R. P. Roblin, Premier, Minister of Railways and Minister of Agriculture.
Hon. C. H. Campbell, K.C., Attorney-General.
From the Province of British Columbia :
Hon. Richard McBride, Premier and Minister of Mines.
From the Province of Saskatchewan :
Hon. Walter Scott, Premier.
Hon. J. A. Calder, Commissioner of Education.
From the Province of Alberta :
Hon. A. C. Rutherford, Premier.
Hon. C. W. Cross, K.C., Attorney-General. 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 15
The above-named gentlemen were received on behalf of the Government of Canada by—
The Right Hon. Sir Wilfrid Laurier, G.C.M.G., First Minister.
The Hon. W. S. Fielding, Minister of Finance.
The Hon. A. B. Aylesworth, K.C., Minister of Justice.
The Hon. Rodolphe Lemieux, K.C., Postmaster-General.
It was moved by the Hon. Mr. Whitney, seconded by the Hon. Mr. Roblin, that the Hon.
Lomer Gouin be chairman of the Joint Conference.
Hon. Mr. Gouin accordingly took the chair.
The Right Hon. Sir Wilfrid Laurier expressed the pleasure of himself and his Ministers
at meeting the Provincial Premiers and their colleagues, and said that his government would
be ready to discuss with them whatever proposals they might, after conference among themselves, agree in submitting.
Hon. Mr. Gouin returned thanks for the honour done him in electing him to the chairmanship of the Joint Conference, and expressed, on behalf of himself and colleagues, his
appreciation of the welcome accorded to them by Sir Wilfrid Laurier.
Hon. Messrs. Roblin, Whitney, Tweedie, Rutherford, Peters, McBride and Scott followed
to the same effect.
After some preliminary discussion, the Joint Conference adjourned at 12.30 p.m., until 11
o'clock to-morrow morning.
Charles Lanctot,
Joseph Pope,
Joint Secretaries.
Conference Chamber,
Ottawa, October 10th, 1906.
The Chairman of the Joint Conference took the chair at 11 o'clock, when all the members
present at the meeting on the 8th instant were convened, and in addition thereto, as
representing the Province of Nova Scotia, the Hon. G. H. Murray, Premier and Provincial
Secretary, and the Hon. Arthur Drysdale, Attorney-General; also the Hon. Adelard Turgeon,
C.M.G., Minister of Lands and Forests in the Provincial Government of the Province of
Quebec.
The Right Hon. Sir Wilfrid Laurier proposed that Mr. Charles Lanctot, K. C, and Mr. J.
Pope, C.M.G., Under Secretary of State, be appointed secretaries of the Joint Conference,
which was agreed to.
The Chairman handed to Sir Wilfrid Laurier certain resolutions of the Inter-Provincial
Conference, which are as follows :—
Extracts from the deliberations of a sitting of the Conference of the representatives of the several
Provinces of Canada, held at Ottawa on the 9th day of October, 1906.
Were Present :
For Ontario :
Hon. J. P. Whitney, Prime Minister.
Hon. J. A. Foy, Attorney-General.
Hon. A. J. Matheson, Treasurer.
For Quebec :
Hon. Lomer Gouin, Prime Minister and Attorney-General.
Hon. Adelard Turgeon, Minister of Lands and Forests.
Hon. W. A. Weir, Minister of Public Works and Labour.
For Nova Scotia :
Hon. G. H. Murray, Prime Minister and Provincial Secretary.
Hon. Arthur Drysdale, Attorney-General.
For New Brunswick :
Hon. L. J. Tweedie, Prime Minister and Provincial Secretary.
Hon. Wm. Pugsley, Attorney-General. D 16 Inter-Provincial Conference, Ottawa. 1907
For Prince Edward Island :
Hon. Arthur Peters, Prime Minister and Attorney-General.
Hon. George E. Hughes.
For Manitoba :
Hon. R. P. Roblin, Prime Minister, Minister of Railways and Minister of Agriculture.
Hon. Colin Campbell, Attorney-General.
For British Columbia:
Hon. Richard McBride, Prime Minister and Minister of Mines.
For Saskatchewan :
Hon. Walter Scott, Prime Minister.
Hon. J. A. Calder, Commissioner of Education.
For Alberta :
Hon. A. C. Rutherford, Prime Minister.
Hon. C. W. Cross, Attorney-General.
Whereas the members of this Conference are of opinion that it is desirable in the interest
of the people of Canada and essential to the development of the Provinces that an immediate
provision be made for an increase of the subsidies granted by the Dominion to the several
Provinces, and for the award to the Provincial Governments by Canada of an amount sufficient
to meet the costs of the administration of criminal justice, not exceeding twenty cents per head
of population ;
Therefore, it is unanimously
Resolved—1. That the subject matter of the resolutions adopted by the Conference of the
representatives of the several Provinces, held at Quebec in December, 1902, and which were
shortly thereafter presented to the Government of the Dominion and which were ratified by
the Legislatures of the then existing Provinces, except that of British Columbia, be now
pressed upon the Government of the Dominion for immediate and favourable action, under
reserve of the right of any Province to now submit to such Government memoranda in writing
concerning any claims it may have to larger sums than those set out in the said resolutions, or
to additional consideration or recognition.
Resolved—2. That in case of the Government of Canada concurring in the views of the
Conference, as expressed in the above resolution, a measure should be submitted to the Parliament of Canada at the next session providing for payment of such increased subsidies and
allowances as may be determined upon, pending an amendment of the British North America
Act, if such amendment should be deemed necessary.
It is also unanimously
Resolved—That sub-section C of resolution No. 1 adopted at the Conference held at
Quebec in December, 1902, be amended so as to read as follows :—
(C.) The population as ascertained by the last decennial census to govern, except as to
British Columbia, Manitoba, Saskatchewan and Alberta ; and as to these four Provinces the
population to be taken to be that upon which, under the respective statutes in that behalf, the
annual payments now made to them respectively by the Dominion are fixed until the annual
population is by the census ascertained to be greater; and thereafter the actual population so
ascertained to govern.
It is also unanimously
Resolved—That the Honourable Mr. Gouin, Premier of the Province of Quebec, and the
Honourable Mr. Whitney, Premier of the Province of Ontario, be a committee to suhmit the
foregoing resolutions to the Government of the Dominion of Canada.
True extracts.
Charles Lanctot,
Secretary of the Inter provincial Conference.
The Hon. Mr. Whitney then submitted a memorandum setting forth the special views of
the Province of Ontario, which is as follows :— 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 17
MEMORANDUM ON BEHALF OF THE PROVINCE OF ONTARIO.
On behalf of the Province of Ontario, the undersigned desire to submit the following :—
The present Government of Ontario had no opportunity to take part in the proceedings
of the former Conferences. Our predecessors did so, however, and united with the representatives of the other Provinces in support of the resolutions which were adopted and which
were presented to the Prime Minister of the Dominion of Canada on the 27th day of January,
1903.
While in all probability we would not have initiated the calling of the Conference for the
object proposed, yet we must consider the real merits of the questions involved, and, in
our opinion, we cannot lose sight entirely of the fact that the then Government of Ontario
agreed to, and that the Legislature ratified, the resolutions above mentioned.
We are strongly in favour of some definite and permanent arrangement regarding the
subsidy question; one which will render unnecessary, and indeed impossible, periodical applications for rearrangement of the subsidies. But while holding these views, we are not able to
agree with the suggestion sometimes advanced that the financial terms of the British North
America Act were intended to be, or should be, final and unchangeable. Experience shows
that the closer we adhere to the exact amounts named as the provincial subsidies nearly forty
years ago, the farther we are driven by changing circumstances year by year from the actual
financial basis established at confederation.
With reference to this point we have no precedents to consider and discuss; the facts
and circumstances surrounding the formation of the American Union and the powers and
duties given to the several States by the constitution cannot be applied to our conditions.
With reference to the situation when the terms of the British North America Act were
under discussion, we have not been able so far to discover an utterance of any public man at
confederation pointing to the conclusion that the then arrangement was to be considered final.
The apparent absence also of any suggestion anticipating the possibilities of the future of the
Provinces and of the Dominion, seems also to show that those most interested did not go farther
in their consideration of the subject than the situation at the moment. And it would have
been indeed strange had they attempted to legislate for posterity and, on behalf of the four
Provinces then about to unite, assumed to bind for all time the nine Provinces now interested
and the greater number undoubtedly to be interested in the future. In our opinion these
considerations prove that the eminent statesmen and publicists who were dealing with this
matter fully realised what we have endeavoured here to indicate.
It is clear that the financial ability of the Dominion to pay subsidies to the Provinces
was considered with reference to the amounts received from customs and excise, the right to
levy which was to be transferred from the Provinces to the Dominion. Therefore, it would
seem reasonable to say that the same principle should be acted upon to-day, and that the
income of the Dominion from these two sources should be taken into account in considering
the amount of the subsidies which should be paid to the Provinces.
Further, the Federal Parliament has by its action in changing on more than one occasion
the financial terms, rendered it impossible to successfully contend to-day, on the ground that
the original agreement was final, that the amount of the present subsidies should not be
changed.
The Dominion of Canada is not burdened with the responsibilities of an independent
nation. The duties of its government are nearly all of a domestic nature. The uses to which
its revenues should be applied are of a similar nature, namely, the wants, necessities, and
reasonable demands of the public, and the people of the Dominion of Canada are the self-same
people who constitute the population of the different Provinces; a fact which, in our opinion,
must be borne in mind in considering this question from an equitable point of view.
The Provinces expend annually large sums of money for immigration purposes They pay
their share of the expenses of the Dominion Department of Immigration, while expending
liberally for that purpose on their own account. The consequences of this are an increase of
the population, an increased consumption of goods paying tariff duties and an increased revenue
for the Dominion of Canada, all of which result from increased provincial expenditure, while
there is no increase in provincial revenue.
If the present situation is to remain unchanged, and the increase in population which
may reasonably be expected occurs, the expenditures of the Provinces will continue to increase
while the revenues of the Dominion will also go on increasing.    In that case, where can the 13 IS Inter-Provincial Conference, Ottawa. 1907
justification be found for imposing upon the taxpayers who are, as we have said, the people of
the Provinces, a financial system which will inevitably result in the accumulation of a large
revenue in which the people of the Provinces who created and contributed it will have no
share 1
It may be interesting to cite here some of the provisions of the Australian Act of Union.
After several years of consideration, the basis of agreement was adopted, and the following
are the provisions of sections 87 and 96 :
Payment to States.
Section 87.
' During a period of ten years after the establishment of the Commonwealth and thereafter until Parliament otherwise provides, of the net revenue
of the Commonwealth from duties of customs and excise not more than
one-fourth shall be applied annually by the Commonwealth towards its own
expenditure.
' The balance shall, in accordance with this constitution, be paid to the
several States, or applied towards the payment of interest on the debts of
the several States taken over by the Commonwealth."
to states'asslstanoe ' Parliament may grant financial assistance to any State on such terms
Section 98. and conditions as the Parliament thinks fit.'
The following figures show the working of the arrangement:—
In 1905 the Commonwealth collected :
Customs and excise      £8,799,500
Deduct cost of collection  256,060
£8,543,440
Out of which there was paid to the States—
To   New South Wales  £2,529,069
Victoria  2,017,378
Queensland  752,532
South Australia  555,692
West Australia  1,027,898
Tasmania  259,099
£7,142,668
Three points suggest themselves in connection with the Australian arrangement :—
(1.) Anything in the nature of a final arrangement, as far as regards a specific amount, was
distinctly avoided.
(2.) Not only was it avoided, but power to render financial assistance to the States, or
any of them, was expressly taken.
(3.) The very large proportion of the customs and excise duties to be paid to the
States—three-fourths—is significant, and the contrast between the amounts so paid to the
States and the amounts to be paid to the Provinces, under our Confederation Act, is startling^
The following comparison will show our meaning more clearly :—
1905. Canada. Australia.
Customs and excise collected...      $54,020,123 £8,799,530    or    $42,824,379
Paid to Provinces and States  4,516,038 7,141,668    or      34,756,117
We are not anxious to unduly emphasise the fact that the Province of Ontario contributes
a very large portion indeed of the Dominion revenue, and we recognise that it would be
impossible, having regard to the position of some of the smaller Provinces, to adjust provincial
subsidies on a strictly proportionate basis. Still, we feel that the burden thus far carried, and
cheerfully carried, by the Province of Ontario entitles her to urge, now that the question of
rearrangement of the subsidies is being discussed, that her claims should be seriously con-
siderd. And we submit that a thorough appreciation of the actual facts relating to the
proportion of the Dominion revenue contributed by Ontario, together with the proportion of
the railway expenditures in that Province, by the Dominion Government, will make it clear that
a settlement which will be satisfactory to the people of Ontario should take them into account. 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 19
We urge that in the future no special grant, at any rate, should be made to any one
province. We repeat that, in our opinion, an agreement, which will render impossible
periodical applications for a rearrangement of the subsidies, is feasible and should be
determined upon. It is possible that such an arrangement might be fixed and positive, and
at the same time elastic, working automatically, so to speak, as the Dominion census from
time to time would determine.
With reference to the resolution in favour of the assumption by the Dominion of the
cost of administering the criminal law, in our opinion, this claim has merits behind it. The
Provinces have neither act nor part in the enactment or amendment of the criminal law, and
it is certainly an anomalous condition of affairs when the Provinces, so situated, are called
upon to pay for the administration of law, with the enactment and amendment of which
they have nothing to do. The amount expended by Ontario for this purpose in 1869 was
$97,424.51, and in 1905 $178,756.51,
In conclusion, we urge that under our system it can never be too late to apply a remedy,
where one is called for. We are confident that a thorough consideration of the situation of
the Provinces under the Confederation Act, of the intention evidenced by the terms of it and
by the changes that have been made since its enactment, as well as an appreciation of the
origin and amount of the Dominion revenues to-day, and of the fact that they are created
by the expenditure of the people of the Provinces, will render comparatively easy a settlement
on a just and equitable basis; one that will be fair to each Province, and one that will be free
from the objection that further changes and re-arrangements may be asked for from time to
time.
J. P. Whitney,
J. J. Foy,
A. J. Matheson,.
Ottawa, October 10th, 1906.
The Hon. Mr. McBride submitted the following memorandum, embodying the claims of
British Columbia to special and distinctive treatment :—
MEMORANDUM RE BRITISH   COLUMBIA'S   CLAIMS FOR SPECIAL
CONSIDERATION.
On behalf of the Government of British Columbia, I adhere to the general principle of
the rights of the Provinces to increased subsidies, and, therefore, support the resolution which
has been submitted in favour of affirming the resolutions of the Quebec Conference, in so far
as they are not inconsistent with or prejudicial to the claims of any particular Province for
additional recognition with respect to such matters as form the subject of those resolutions.
The Government of British Columbia cannot, however, accept them as a final and full
settlement of its demands. There are special considerations in the case of British Columbia
which involve additional recognition in its behalf. These considerations are set forth in the
memorial presented to the Dominion Government last year, a copy of which is herewith
submitted *, and a resolution affirming the position of the Provincial Government was
unanimously adopted by the Legislature of the Province of British Columbia. The resolutions of the Conference of Quebec, which, if carried into effect, would increase the subsidies
already received by British Columbia, relatively speaking, leave it no better, if as well, off.
This is obvious for two reasons :
1st. Owing to the excessive contributions made by British Columbia to the Federal
treasury, as compared with other Provinces, the Province would pay an undue proportion of
the amount of the increase in subsidies to all the Provinces. A parallel in support of this is
afforded in the allowance which was made at the time of Confederation to certain Provinces
on account of the greater debt of other Provinces, in the payment of which the people -of all
the Provinces had to share. Our case is precisely similar now to that in which those Provinces
would have been had no such allowance been made.
* See Appendix, pages 26 et seq.
2nd. The proposed increase in subsidies being largely based upon population, the special
physical conditions which make the cost of government in the Province of British Columbia
disproportionately great are not provided for. D 20 Inter-Provincial Conference, Ottawa. 1907
Briefly, as set forth in the memorial of the Government of British Columbia, already
referred to, "The claims being presented by the other Provinces for increased subsidies are
similar in character to some of those of British Columbia, with this important distinction,
that the reasons which alike give them foundation are greatly accentuated in the case of this
Province."
A brief summary of the arguments in our case is herewith submitted :—
For a proper knowledge of the case, it is necessary to consider the conditions which
existed at the time British Columbia entered Confederation, and the mental attitude in which
the terms of union between the Province and the Dominion were framed. Public sentiment, as represented in Parliament, was prejudicial to more favourable terms being granted.
A large section of Canada was utterly opposed to union with British Columbia on the teims
under which the construction of a transcontinental railway was rendered obligatory. It was
only upon grounds of large public policy of a national character—the rounding out of Confederation—that their adoption was justified. It was almost universally conceded that the
Province, physically handicapped as it was, would not pay its way in Confederation, and it
was strongly contended that the construction of the Canadian Pacific Railway—the price
asked by British Columbia—was too great a sacrifice on the part of the Dominion, and that
the railway when built would prove unremunerative. Consequently the financial terms
conceded to British Columbia were the least favourable possible.
A similar attitude towards British Columbia was maintained as long subsequently as
1884, when the Settlement Act was passed, whereby the outstanding differences between the
Provinces and the Dominion were finally adjusted. By the terms of the Settlement Act, the
Province, tired of delays and wearied with fruitless negotiations, agreed to transfer 3,500,000
of the best land in the Peace River District in lieu of expenditures on the part of the
Dominion, amounting in all to about $1,100,000. These lands, worth now, at the lowest
valuation, $17,500,000, were parted with to secure a railway from Esquimalt to Nanaimo,
costing less than $3,000,000, which, under the Carnarvon terms, the Dominion Government
has pledged itself to build without cost to the Province. The value of such concession was
not then foreseen. The treaty of 1871, as revised in 1884, was made in misapprehension of
the possibilities of British Columbia and the development to accrue from the building of the
Canadian Pacific Railway.
The subsequent course of events has shown that British Columbia has not only paid its
way in Confederation, but has contributed in thirty-five years nearly $19,000,000 to the
Federal treasury in excess of what it has received therefrom; that the Canadian Pacific
Railway has been instrumental more than any other factor in building up Canada, with
benefits vastly greater to eastern Canada than to British Columbia; and that the Settlement
Act gave a realisable asset to the Dominion nearly twenty times greater than the expenditure
which it involved.
The Government of British Columbia submits as incontrovertible that as the original and
amended term of union having been based upon assumptions which have proved groundless,
and as that the very opposite of what was anticipated has transpired, it is incumbent, in the
light of developments which have actually taken place, upon the Dominion, morally and
constitutionally, to now substitute fairer terms for those made perforce in anticipation of
what did not happen.
This contention is strictly in line with what is promised in the resolution of the Quebec
Conference of 1902, to the effect that at the time of the passing of the B. N. A. Act, "it was
impossible to foresee the development of the Dominion," and to provide in an unalterable and
fixed way for the requirements of the various local governments for all time to come, except
that the conditions arc so peculiar and exceptional in the case of British Columbia as to
demand exceptional consideration in the revision of financial terms now deemed necessary.
In the memorial presented by the Government of British Columbia to the Dominion
authorities, and in various letters and memoranda, the historical aspect of the case has been
reviewed, and the reasons for special consideration given in extenso. In addition to the foregoing, it has been pointed out that there are certain conditions and physical disabilities,
permanent in character, which accentuate the position of British Columbia considered in
relation to the other Provinces, and that abnormally increase the cost of administration in
that Province as compared with the average conditions of the rest of the Dominion, entailing
as well disadvantages of commercial, industrial and political character.    These are :—
1.  The cost of administration, owing to the physical character of the country. 7 Ed. 7
Inter-Provincial Conference, Ottawa.
D 21
2. The distance from the commercial, industrial and administrative centres of Eastern
Canada.
3. The non-industrial character of the Province, as compared with Eastern Canada,
whereby a large percentage of goods are imported and consumed, increasing the contributions
to the Federal Treasury, in the way of taxes, in a ratio of three to one.
4. The disadvantages of the Province in relation to the market for its special products.
Under the first head, it is pointed out, and supported by tables filed in the official records
of all the Provinces, that the physical conditions referred to seriously affect the cost of
government under every head.
The following table, covering a period of thirty years of all the Provinces, will sufficiently
illustrate these contentions :—
Provinces.
Average
Population
for
Thirty Years.
Total
Expenditure
for
Thirty Years.
Average
per head
per year.
90,634
123,801
104,062
1,421,994
314,802
1,961,260
434,585
$
32,243,068
16,025,974
9,179,906
104,027,881
20,381,060
105,798,514
21,525,863
$ ets.
11 86
4 31
2 94
2 44
2 16
1 79
1 65
4,451,138
$309,182,264
|2 32
British Columbia is a country, roundly speaking, 900 miles in length and 500 miles in
width, including an area of 381,000 square miles, extremely mountainous in character and
settled in widely detached valleys with a sparse population. This involves an expenditure for
government very much greater than in Provinces which are compact and do not present the
same peculiar conditions with which that Province is confronted.
2. The geographical position of the Province, though very important in one sense, is very
disadvantageous in relation to the Dominion as a whole. We sell very little to Eastern
Canada on account of the nature of our products, and we buy very largely there for the same
reason. Inter-Provincial trade was the material object in Confederation. The Province,
therefore, having four per cent, of the population pays eight per cent, of the price of Confederation, and gets in return one per cent, of the trade (see table, page 33, prepared by
Mr. George Johnston, late Dominion Statistician).
3. The non-industrial character of the Province accounts for the enormous contributions
it has made to the Federal Treasury in proportion to the amount received in return. An
elaborate statement of the account appears in the memorial referred to, which has been brought
up to date, showing an excess of contributions over receipts amounting to nearly $19,000,000.
This is not submitted as an exact mathematical solution of financial relations, but is substantially accurate, and represents approximately the actual condition of affairs in respect to receipts
and contributions. There is the further consideration that the population, which accrues
directly to the benefit of the Dominion, accrues in the ratio of about three to one, as compared
with the average benefits from population, in other sections of Canada.
4. The geographical position of the Dominion also handicaps it in relation to the products
which it sells. This is true, for the most pact, of foreign exports of lumber, of fish and of
minerals, and of many other things that it is hoped to produce in the future, such as manufactures of iron and paper. For the most part, British Columbia sells in the markets of the
world in competition with the world. It cannot sell in Eastern Canada in competition with
eastern manufactures owing to distance, and is thus handicapped in what it buys and what it
sells.
Its geographical position has still further the effect of increasing the cost of consumption
by imposts in the way of freight on goods which are imported from a supply centre of Canada
and elsewhere. D 22 Inter-Provincial Conference, Ottawa. 1907
In addition to the natural disadvantages under which the Province has laboured may
fairly be cited the political disadvantages of a limited representation in Parliament and the
long distance from the seat of government. Without reflection upon one administration at
Ottawa more than another, the Province, by reason of these handicaps, has not in the past
received that consideration for its various wants that is extended to the people of Eastern
Canada, who have large representation and easy access to the Capital.
Comparing the terms conceded to British Columbia and to the new Provinces of Alberta
and Saskatchewan, it is found in effect that when these Provinces are in receipt of the total
allowance to which they will be ultimately entitled per annum, the amount, in round numbers,
will be $2,250,000, while the total of British Columbia's allowance, when it has reached its
maximum, will be less than $500,000. It is not contended that the new Provinces have
received too much, but that British Columbia has received far too little. Alberta and Saskatchewan contain large, compact, arable areas presenting no physical difficulties or obstacles
to development. While it may be said that in their case the lands and the minerals belonged
to the Dominion, if we take the case of British Columbia, with its public domain in its own
right, the average of its receipts for the past thirty years on account of its natural resources
has only been $235,000 per annum, from which must be deducted the cost of administration,
not less, at the present time, than $100,000 per annum. It is submitted, further, that the
readjustment of the subsidies every two and a half years, according to the increase of population ascertained by census-taking, in our estimation, is another important advantage which
the new Provinces have over British Columbia. They obtain almost immediately in increased
subsidy the benefit of increased population, while British Columbia, in which the increase of
population is also very rapid, has to wait ten years for readjustment. There is, therefore, only
one of two conclusions to be drawn from a comparison of the terms in the two cases; either
the new Provinces have been too generously endowed by the Dominion—which is not alleged—
or British Columbia has received very inadequate consideration of its requirements.
The Government of British Columbia, in view of all the considerations which have been
advanced in support of the claims of that Province, reaffirms its position in regard to the
desirability of a complete investigation by a competent tribunal of the merits of the Provincial
contention. It is, therefore, asked that a commission be appointed consisting of three persons
of eminent repute, one to be named by the Government of the Dominion of Canada, one by
the Government of British Columbia, and the third by the Honourable the Secretary of State
for the Colonies. It is asked that the reply of the Dominion Government be made definite
and final within three months from the present time.
Richard McBride,
Premier
Ottawa, October 9th, 1906.
The Right Hon. Sir Wilfrid Laurier announced that the resolutions of the Inter-Provincial Conference would be taken into consideration by himself and his colleagues.
The Joint Conference adjourned at twelve o'clock noon, until to-morrow at 11 A. M.
Charles Lanctot,
Joseph Pope,
Joint Secretaries.
Conference Chamber,
Ottawa, Thursday, October 11th, 1906.
The Chairman of the Joint Conference took the chair at 11 o'clock, when the members
were convened.
The question of the claim of the Province of British Columbia for special consideration
was discussed.
The Joint Conference adjourned at 1 p.m., until to-morrow at 11 a.m.
Charles Lanctot,
Joseph Pope,
Joint Secretaries. 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 23
Conference Chamber,
Ottawa, Friday, October 12th, 1906.
The Chairman of the Joint Conference took the chair at 11 o'clock, when the members
were convened.
The Hon. Mr. Gouin submitted a resolution of the Inter-Provincial Conference touching
the practice of the Dominion Government in deducting claims which the Dominion may have
against any Province from the subsidy due to such Province.
At the request of the Right Hon. Sir Wilfrid Laurier, this resolution was withdrawn for
reconsideration by the Inter-Provincial Conference.
The Right Hon. Sir Wilfrid Laurier then addressed the Joint Conference to the following
effect:—
" I have given careful consideration to the memorial of British Columbia's Government,
and particularly to the request that a Commission be appointed for the purpose of inquiring
into the financial relations between the Dominion and the Province. I have been unable to
reach the conclusion that the appointment of such a Commission would be the best way of
dealing with a question of this kind. I fear that such a course would not lead to the harmonious settlement of the grants to Provinces, which all should desire to bring about. However,
I regard the matter at present more as one for the opinion of the Conference than for the
judgment of the Dominion Government. You have assembled for the purpose of considering
the sums which should properly be paid by the Dominion to the Provinces in the way of
subsidy and allowance for the maintenance of Government. The British Columbia proposal
comes entirely within the chief purpose of this Conference. If this Conference, after hearing
Mr. McBride's arguments in support of his contention, reach the conclusion that an arbitration should take place, through a Commission, for the purpose of dealing with the claim of
British Columbia, that would present the- matter to the Dominion Government in a new light,
and, while I am not prepared to express any final opinion, I can say at once that such a
recommendation from the Conference would have great weight with us, and we should feel
bound to give it further consideration. While I give you this expression of my own views
and of the views of my colleagues who are here with me, I shall, if you will permit me, offer
a suggestion, I think there is a disposition on the part of the Conference to recognise that
the conditions in British Columbia, owing to the vastness of her territory, to its mountainous
character, and the sparseness of her population, create exceptional difficulties which should be
taken into consideration in the adjustment of the distribution of the grants in aid of Provincial Governments. I am, myself, disposed to admit that such is the case. I would strongly
advise that Mr. McBride avail himself of the good disposition which is manifested in the
Conference, and at once approach the question of what allowance, in addition to that already
contemplated, should be made to meet British Columbia's difficulties. It is a question, which,
after all, can better be settled here than anywhere else. I feel assured that the Conference
will be willing to deal with the matter in a spirit of fairness to British Columbia. I propose,
therefore, that we shall leave you to discuss the question frankly with one another, and come
to you again when probably you will have reached some satisfactory agreement."
After some discussion the Joint Conference adjourned at 12 o'clock noon, to meet tomorrow at 11 a.m.
Charles Lanctot,
Joseph Pope,
Joint Secretaries.
Conference Chamber,
Ottawa, Saturday, October 13th, 1906.
The Chairman of the Joint Conference took the chair at 12:30 p.m., when all the members
were convened with the exception of the Hon. Messrs. Lemieux and McBride.
The  Chairman submitted a resolution of the  Inter-Provincial Conference, which is as
follows :— D 24 Inter-Provincial Conference, Ottawa. 1907
Extract from the deliberations of a sitting of the Conference of the representatives of the several
Provinces of Canada, held at Ottawa, on the 12th of October, 1906.
It was resolved :—
That in the opinion of the Conference  it is  unadvisable  that the claim, in the way of
subsidies, of any Province be referred to arbitration.
(True extract.)
Charles Lanctot,
Secretary of the Inter-Provincial Conference.
The Chairman submitted a resolution of the Inter-Provincial Conference on the subject of
the claims of British Columbia for special consideration, which is as follows :—
Extract from the deliberations of a sitting of the Conference of the representatives of the
several Provinces of Canada, held at Ottawa, on the 13th day of October, 1906.
It was resolved :—
That in view of the large area, geographical position and very exceptional physical
features of the Province of British Columbia, it is the opinion of this Conference that the said
Province should receive a reasonable additional allowance for the purposes of civil government,
in excess of the provisions made in the Quebec Resolutions of 1902, and that such additional
allowance should be to the extent of one hundred thousand dollars annually for ten years.
(True extract.)
Charles Lanctot,
Secretary of the Inter-Provincial Conference.
The Chairman informed the Conference that Mr. McBride declined to assent to the terms
of this resolution, and declared that he could take no further part in the proceedings of the
Inter-Provincial Conference, and that after making this statement he had withdrawn.
At this stage, the Hon. Mr. McBride entered the Conference Chamber and took his seat
at the Joint Conference.
At 1.10 p.m. the Joint Conference took recess.
The Joint Conference re-convened at 2.30 p.m., when the Chairman took the chair, all
the members being present with the exception of the Hon. Messrs. Lemieux, McBride and
Drysdale.
The Right Hon. Sir Wilfrid Laurier announced that the Dominion Government had
come to the conclusion to agree to the resolutions embodying the views of the Inter-Provincial
Conference submitted by the Hon. Mr. Gouin on the 10th October, with the exception of that
portion of the first resolution proposing an increased subsidy towards the cost of the administration of criminal justice, and also to the proposal that a bill should be introduced into the
Parliament of Canada, providing for the payment of the increased subsidies and allowances
pending the necessary amendment to the British North America Act, neither of which he was
prepared to entertain. These resolutions, with the above recited exceptions, are substantially
the same as those of the Quebec Conference of 1887.
The Prime Minister added that his Government desired to impress upon the Conference
the fact that these resolutions of 1887 seemed to have been drawn and considered with great
care, and they are of opinion that the terms agreed to at that time ought not to be departed
from.    These resolutions provide as follows :—
That this Conference is of opinion that a basis for a final and unalterable settlement of
the amounts to be yearly paid by the Dominion to the several Provinces for their local
purposes and the support of their Governments and Legislatures may be found in the proposal
following, that is to say :—
A. Instead of the amounts now paid, the sums hereafter payable yearly by Canada to
the several Provinces for the support of their Governments and Legislatures, to be according
to population, and as follows :—
(a) Where the population is under 150,000    $100,000
(b) Where   the  population  is   150,000,   but   does   not   exceed
200,000        150,000
(c) Where  the  population  is   200,000,   but   does   not   exceed
400,000      180,000 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 25
(d) Where the  population  is  400,000,   but   does   not   exceed
800,000      190,000
(e) Where   the  population  is  800,000,   but   does   not   exceed
1,500,000 ,      220,000
(J) Where the population exceeds 1,500,000      240,000
B. Instead of an annual grant per head of population now allowed, the annual payment
hereafter to be at the same rate of eighty cents per head, but on the population of each
Province, as ascertained from time to time by the last decennial census, until such population
exceeds 2,500,000, and at the rate of sixty cents per head for so much of said population as
may exceed 2,500,000.
Sir Wilfrid Laurier further observed that his Government had considered this question
up to this moment in the hope that the present Inter-Provincial Conference would be unanimous. He said that while there is unanimity with respect to the principle of increased
subsidies and also in regard to that portion of the resolution of the Inter-Provincial Conference
submitted by Mr. Gouin on October 10th, to which the Government has agreed, there was a
special claim from British Columbia, touching which some difference as regards the amount
exists. Sir Wilfrid Laurier added that he wished to report to his colleagues on that point
before giving a final assent.
The question of the discrimination against Dominion charters by Provincial authorities
was adverted to by the Right Hon. Sir Wilfrid Laurier, who expressed the view that there
should be no such discrimination.
The Right Hon. Sir Wilfrid Laurier referred to the previous discussion on the Provincial
tax on commercial travellers.
The Chairman of the Conference announced that this question had been considered by
the Inter-Provincial Conference, and that the various Premiers had come to the conclusion to
propose to their Legislatures the repeal of this tax.
Some discussion was had on the subject of the fisheries, in the course of which the Right
Hon. Sir Wilfrid Laurier dwelt on the inconvenience arising from the divided jurisdiction
which at present exists.
The joint Conference adjourned at 4:45 p.m.
Charles Lanctot,
Joseph Pope,
Joint Secretaries. D 26 Inter-Provincial Conference, Ottawa. 1907
APPENDIX.
The Case of British Columbia for Better Terms.
Memorandum of  the Government of  British  Columbia in the Matter of   Readjustment of Financial Relations.
His Excellency at the recent opening of parliament having intimated that provincial
autonomy would be granted to the Northwest Territories, and in view of the possible readjustment at the same time of the financial relations between the Provinces and the Dominion, the
Government of British Columbia desire to place on record and reiterate the claims of this
Province for distinct and separate relief.
The relief sought is from an insufficiency of revenue arising out of causes constant in
operation and peculiar to British Columbia.
These causes render it impossible to provide for the responsibilities of local administration
imposed under the terms of union, without creating intolerable burdens of taxation or
exhausting the resources of provincial credit.
It was intended by the framers of the B.N.A. Act, as will be shown, that the amount of
revenue left to the Provinces after confederation, should be adequate for the performance of
all local services, and, therefore, the government submit as a basis of their claims, that it is
constitutionally incumbent upon the Dominion Authorities to increase the allowance wherever
and whenever it can be shown that such circumstances do not exist.
To review the steps that have been taken towards obtaining a recognition of the claims of
the Province, early in 1901 a delegation from the Government of British Columbia interviewed
the Dominion authorities upon a number of matters as between or affecting the relations of the
two governments, one of which was the. subject-matter of this memorandum.
Prior to that time, upon several occasions in the federal parliament, attention was called
to the large contributions from the Province to the federal treasury in the way of customs and
inland revenues. By comparison with the rest of Canada, these were shown to be in the ratio
of three to one. Attention had also been called to these facts in the local legislature on several
occasions as forming a just claim for increased subventions by the Dominion to railway enterprises in the Province.
In the memorandum submitted by the delegation of 1901 was a tabulated statement
showing the contributions in the federal treasury from, and the expenditures by the Dominion
in, the Province of British Columbia since 1871. This statement has been completed by the
addition of the figures for the years 1901-2-3, and it appears in the appendices hereto. From
this statement it will be seen that during 32 years the Province has contributed to the
revenues of Canada the sum of $49,397,238, and has received in expenditures in return the sum
of $32,454,382, and that the excess of contributions over expenditures is about $17,000,000.
The cost of no portion of the construction of the C.P.R., which, like the canal system of
eastern Canada, is national in its character, was included in this statement; but, as pointed
out, there is included the cost of other services which are national and would not be chargeable
to any of the Maritime Provinces in an accounting of a similar nature.
That British Columbia has much more than borne its rightful share of the expenses of
governing Canada is demonstrated by the fact that while on its part it exhibits this surplus
of $17,000,000, the net debt of the Dominion has risen from $80,000,000 in 1872, to over
$261,500,000 in 1903, or an increase of about $181,500,000. Not only, however, has British
Columbia contributed thus unduly to the federal treasury, but it has become liable for its
share of the general liability of the Dominion, which share according to population is, roughly
speaking, $9,000,000.
All this is in addition to the disproportionate burden of administering a Province, the
physical conditions of which render it many times more expensive than other Provinces.
Attention is called to a statement in the appendices of what the results in a financial way
would have been had the contributions of the whole of Canada to the federal treasury been in 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 27
the same proportion as those from British Columbia ; and, conversely, what the results of
British Columbia's contributions would have been had they been in the same proportion as
from the rest of Canada.
The position created as the result of our financial relations was stated in the memorandum
of 1901, as follows :—
" A Province has a certain population and contributes a certain revenue. What it pays
as imposts to the treasury is, per capita, its impost or burden of government. Computations
on that basis in various ways show, as a general and almost invariable result, that for a whole
period of years the burden has been two and three-quarter times that of the rest of Canada,
taken as a whole."
Attention was also called to the duty paid indirectly by people of the Province on goods
brought from Eastern Canada upon which duty had been collected at eastern points of entry,
and added to the price at the western end. From data acquired on the subject by the provincial government in 1897 the duty thus indirectly paid then amounted to about $300,000 per
annum.    The total amount paid since 1871 is estimated to have been $6,000,000.
Although the delegation of 1901 did not make a special feature of the arguments arising
out of the physical disabilities of the Province, it was kept in mind, as the following shows :—
" In this connection, too, we must also consider the very much greater cost per capita
involved in the development and government of a Province like British Columbia, where the
physical features are so rugged and distances so great, and communication so difficult and
expensive, and the population is comparatively sparse."
Reference was also made to the increased burden upon the consumer in British Columbia
by reason of the large freight bills on goods coming from eastern centres ; and also to the disadvantages arising out of the extreme westerly position of British Columbia in respect to
finding a profitable market for what is produced therein.
In January of the year 1903, a second delegation went to Ottawa to confer with the
representatives of other Provinces on the subject of financial relations generally, and, in particular, to lay before the Dominion authorities the claims of British Columbia for increased
subsidies, apart from any general settlement made in behalf of all the Provinces.
At the conference which took place special stress was laid upon several aspects of the
question, which differentiated the claims of British Columbia from those of other Provinces
and demanded special consideration.
It may be urged that the Province of British Columbia is bound by the terms of the
memorandum adopted by the Quebec Inter-Provincial Conference, inasmuch as it was signed
by the members of the British Columbia Delegation. By reference, however, to this memorandum it will be found that it embodies a letter to the Premier of Quebec, convener of the
conference, from the Premier of British Columbia, presenting the special claims of the Province
and expressly stipulating that concurrence in the joint memorial was subject to the rights of
the Province to special consideration on account of exceptional conditions. Adherence was
given to the principles involved in the resolutions of the Conference setting forth the reasons
for readjustment as applicable in a greater or less degree to all the Provinces; but it was held
that in the case of British Columbia not only was the force of these reasons greatly intensified,
but that there were considerations forming additional reasons which did not at all apply to the
other Provinces and for which additional allowance should be made.
It was stated by the delegation of 1903 that—
"The position we take is not that the Dominion Government has violated the Terms of
Union, or that we are entitled to compensation for lack of fulfilment in any substantial
respect, as the performance of a legal contract could be construed; but we do contend that in
the development of the constitution, in its actual operation, from the date of Confederation in
1871, a state of affairs has grown up in British Columbia and the Dominion, as the result of
the union between the two, that has established a moral right and a sound constitutional claim
on our part for increased recognition—a state of affairs that was not anticipated by either
party to the federal compact."
The historical and constitutional arguments in support of the claims were summarised as
follows :—
" That there is an absolute precedent in the Nova Scotia settlement of 1868, inasmuch as,
without any charge of violation of the Terms of Union by the Dominion, the claims of Nova D 28 Inter-Provincial Conference, Ottawa. 1907
Scotia were recognised on the grounds that the sources of revenue left to the Province were
not sufficient to meet local requirements, and on the grounds generally that the peculiar
geographical position and exceptional conditions of that Province demanded a revision of the
financial arrangements. It was admitted in Parliament that there were substantial grounds
for the claims made, that there was an injustice, and that it was incumbent upon the Dominion
Government to redress grievances where they existed, not only on moral grounds, but to ensure
the success of Confederation :
" That, after careful investigation and reference to the best and highest authorities, it
was competent for the Parliament to adjust financial relations, where necessary, without a
change in the British North America Act :
" That the principle once established and, as a matter of fact, put in force on several
subsequent occasions in respect to other Provinces, it is not only competent but a matter of
right and constitutional necessity on the part of the Dominion to apply that principle whenever and wherever the circumstances justify it:
" That it is recognised that the Act of Union is a' contract and a treaty binding for all
time to come, but that it is not a contract like the laws of the Medes and Persians, invariable,
but subject to modification as circumstances demand, as the resolutions of the Premiers
presented to you yesterday premise. At the time of the British North America Act, or the
British Columbia Terms of Union were passed, it was impossible for either party to foresee the
results of union, or to fix in an absolutely definite way and unalterably the financial relations,
so as to provide equitably for all time to come for the requirements of both classes of Governments ; and that it was the evident intention of the framers that adequate provision should be
made for both :
"That, with reference to British Columbia, although it is not contended that it was
forced into Confederation as it is claimed Nova Scotia was, yet the circumstances and conditions of the Province were such that there was but little alternative left to her in the matter
of terms:
" That the terms were not the terms the people of British Columbia asked for and
believed were necessary for the adequate administration of local affairs and the development
of the country :
" That, as shown by the debates which took place both in the Local House and in the
Houses of Parliament at Ottawa, in neither case were the framers of the terms able to accurately or even approximately foresee what the results would be, and that in a great measure for
both it was a leap in the dark :
" That the people of British Columbia did, from a local knowledge of their own Province,
appreciate the necessity of and stipulate for a much larger provision for the financial requirements of the Province than was conceded by the Dominion :
" That the Dominion Government did not agree to the terms of British Columbia for the
reason that they feared and believed that this Province would remain a drag on the Dominion,
and it is well known that they could only secure a ratification of the treaty in the House by
granting the least favourable conditions possible. The Government at Ottawa, in the matter
of British Columbia, acted solely on the policy of creating a nation extending from ocean to
ocean, and in doing so were under the conviction that they were assuming burdens quite out
of proportion to the value of the Province as an asset—in other words, sacrificing material
interests to a large extent in the interests of patriotic sentiment—that of ' rounding out Confederation.'    The whole debate confirms that view of it absolutely:
" That the reasons which dictated the policy of the Government at that time have been
shown by the developments which have taken place in British Columbia, and the financial
results which followed, to have been entirely and absolutely erroneous and unfounded :
"And that, therefore, although the framers of that treaty were without doubt honest,
high-minded, and, from the knowledge they possessed then, justified in that course, their reasons
having proved unfounded the Government of to-day is entitled in equity to recognise the
consequences of those errors and compensate for the inordinate benefits the Dominion has
received, and also increase the allowance for the requirements of the public service in a Province demanding so extraordinary a rate of expenditure for its settlement and development."
The delegation then proceeded to present a statement of facts bearing upon the peculiar
conditions and position of the Province, under the following heads :—
" 1. The cost of administration, owing to the physical character of the country. 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 29
" 2. The distance from the commercial, industrial and administrative centres of Eastern
Canada.
" 3. The non-industrial character of the Province, as compared with Eastern Canada,
whereby a larger percentage of goods are imported and consumed, increasing the contributions
to the federal treasury, in the way of taxes, in a ratio of three to one.
" 4.  The disadvantage of the Province in relation to the markets for its special products."
The statement of the case, as above, will be found in full in the appendices to this
memorandum.
In the summer of 1903 a third delegation from British Columbia interviewed Sir Wilfrid
Laurier and other members of the Dominion Cabinet at Ottawa, and strongly urged their
consideration of the facts that had been submitted by previous delegations.
The principal object of this delegation, however, was to impress upon the Dominion
authorities a proposal for the reference of the claims of the Province to a Joint High Commission, consisting of three members to be named, one by the Dominion Government, one by the
Government of British Columbia, and one by the Imperial Colonial Secretary.
Having presented the foregoing resume of former negotiations, it is here proper to observe
that the claims being presented by the other Provinces for increased subsidies are similar in
character to some of those of British Columbia, with this important distinction, that the
reasons which alike give them foundation are greatly accentuated in the case of this Province.
With regard to the reasons for financial readjustment contained in the resolutions adopted
by the Quebec Interprovincial Conference of 1902, it is submitted that it is a fair presentment
to say that they are, mainly, as follows :—
(1.) That new conditions have arisen since Confederation which were unforeseen or not
provided against at that time.
(2.) That the financial resources of the several Provinces, as determined by Statute, are
no longer sufficient to meet the expenditure necessary to adequately administer the affairs of
the Provinces and efficiently promote their further development.
(3.) That the growth of population, by reason of development, the result of efforts on the
part of both the Dominion and Provincial Governments, increases the financial responsibilities
of the Provinces without a corresponding increase of revenue, as a consequence, and without
provision for a corresponding increase of subsidy to meet it.
(4.) That it was the evident intention of the framers of the Terms of Union to make
adequate financial provision for the requirements of the Dominion and Provincial Governments
for all time to come.
It is assumed that it will be for these reasons, and for these reasons alone, that a general
readjustment of financial relations will, if effected, be brought about.
In this connection, the remarks of Hon. S. N. Parent and of Hon, G. W. Ross are noteworthy, and a few of the more pertinent of their observations are given in the Appendices at
page 38.
Taking the foregoing considerations as applicable, in common, to the claims of British
Columbia, they have, as intimated, exceptional force, the evidence of which exists in two main
facts:—
(a.) The charges against the Province through Customs and Excise revenues, to which
may properly be added heavy freight bills, arising out of long distance from centres of supply
in the East, are several times greater than in the other Provinces, and thus to that extent
lessen the ability to maintain the cost of local administration.
(b.) The responsibilities of population involved in the increase of population in British
Columbia, as will be shown, are several times greater than elsewhere in Canada by reason of a
combination of disadvantageous conditions, mainly physical in their nature.
The contentions of the Quebec Conference that increased subsidies to the Provinces to
permit of their still further development would bring increased revenues to the Dominion as a
compensation, apply with peculiar force to the particular case of British Columbia. This
Province has, admittedly, great sources of wealth. Obviously, however, owing to the physical
obstacles to overcome, to make these sources available by development, an expenditure very
much larger than in other Provinces is required ; hut, as British Columbia has in the past con- 1) 30
Inter-Provincial Conference, Ottawa.
1907
tributed, and in the future must continue to contribute, in an excessive ratio to the Federal
Treasury, as compared with the rest of Canada, so the Dominion for relatively increased subsidies to this Province will reap a corresponding increase in revenue to the treasury and in
benefits to trade and industry.
The conditions, permanent in character, which accentuate the position of British Columbia,
considered in relation to the other Provinces, have previously been enumerated.
To arrive at a definite basis upon which to submit a claim in a stated sum as compensation
on account of such conditions of physical disabilities, which increased abnormally the cost of
Provincial administration compared with the average conditions of the rest of the Dominion,
a full and detailed examination has been made covering the expenditures of all the Provinces
for various services since 1871.
The first of these conditions, which refers to the mountainous surface, is one which clearly
differentiates the case of this Province from that of every other Province. The extreme limit
of the arable land is about one-twenty-fourth of the entire surface, or at the very outside,
10,000,000 acres, much of which cannot be classed other than pasture land, out of 240,000,000
acres. The habitable area is mainly restricted to the arable portions. This lies more or less
evenly distributed in widely separated narrow valleys immured by precipitous mountain sides.
This is a condition which finds no parallel in Canada among the other Provinces, the distinct
effect of which upon the cost of Provincial administration may, by an examination of the
statistics referred to, be ascertained in some degree of definiteness. It is a condition which
neither settlement nor development can alter in the slightest, and on account of which settlements are small in area, isolated in position and difficult of access. As a consequence, the
Province pays per head of its population for roads, streets and bridges over twenty times as
much in the average as the same services cost in the other Provinces for the five years, 1898-
1902, as the following table shows :—
Annual Expenditure per Head for Roads, Streets and Bridges.
Provinces.
1898.
1899.
1900.
1901.
1902.
Average.
British Columbia	
New Brunswick    	
$ cts.
2 30
0 47
0 19
0 26
0 064
0 05
$ cts.
3 74
0 48
0 31
0 18J
o 174
0 08"
0 04
$ cts.
1 89
0 49
0 424
0 20
0 25
0 11
0 07
$ cts.
2 94
0 72
0 424
0 254
0 13
o 114
0 06
$ cts.
3 68
0 89
0 38
o 204
0 15
0 07
0 094
$ cts.
2 91
0 61
0 384
0 20/-0
Manitoba	
0 19A
0 08|
Ontario	
0 06A
Average   22^-
Averages of all the Provinces other than British Columbia   13 §
To the cost per mile and not to the mileage or the sparse population is due this abnormal
expenditure for road construction in British Columbia. Its six thousand miles of waggon roads,
which are wholly inadequate to the needs of the districts they serve and far from a state of
completion, based on the standard of Eastern Canada, have cost on an average over $2,000 per
mile. For purposes of comparison, it will be fair to take not the numerous roads in the older
settled sections of Eastern Canada, built for the main part by statute labour, but the expensive
mining and colonization roads in the new and northern part of Ontario in which the conditions
mere nearly approach those in British Columbia. For 18 years, 1867-1885, in Algomo,
Muskoka and other parts the average cost of construction of new roads was $294 per mile for
over 2,000 miles (vide Sessional Papers Ontario, 1885, Return No. 24). Thus the ratio of cost
is 7 to 1. This disparity is as enduring as trie mountains which give rise to it. It may be
argued, however, that the addition of municipal expenditure to Provincial expenditure would
vary the results to the prejudice of British Columbia. There is difficulty in obtaining municipal
statistics for all the Provinces. In Ontario and British Columbia, however, there are complete
statistics which are available for comparison. It is pointed out, too, that when Ontario went
into Confederation it was largely municipalised, and that all previous liabilities for public 7 Ed. 7
Inter-Provincial Conference, Ottawa.
D 31
works were assumed by Canada as a whole. Adding Ontario and British Columbia's, municipal
expenditure per head for 1901 (as a convenient year), for roads, streets and bridges to the foregoing Provincial average per head for five years, we have:—
British
Columbia.        Ontario.
Provincial expenditure for roads per head per year for five years $2  91 $0 06^
Municipal expenditure for roads per head for 1901      1 58 1 63
49        $1  69-j^
,425 to place British Columbia
Total	
Showing an annual sum of 2.79T7y- per head, or a sum of i
on an equal footing with Ontario with respect to the item of Provincial and Municipal expenditure for this service alone.
British Columbia's per capita expenditure for civil government, arising out of the services
of the Government required in widely scattered communities, is over nine times that of the
average of the other Provinces, as the following table shows :—
Annual Expenditure pep. Head foe Civil Government.
Provinces.
1898.
1899.
1900.
1901.
1902.
Average.
$ cts.
0 87
0 174
0 19
0 114
0 08
0 06
0 05
$ cts.
0 82
0 17
0 154
0 114
0 09
0 05
0 044
$ cts.
1 01
0 174
0 13
0 12
0 09
0054
0 044
$ cts.
1 28
0 164
0 15
0 13
0 09
0 06
0 044
$ cts.
1 31
0 16
0 15
0 13
0 09
0 07
0044
$ cts.
1 06
0 16,9,,
Manitoba	
0 154
0 12J
New Brunswick	
Prince Edward Island	
0 08f
0 06
0 04*
Another service that is peculiarly affected by the conditions referred to is that of the
Administration of Justice, which is four times that of the average per capita cost in the other
Provinces as compared by the subjoined table :—
Annual Expenditure per Head for Administration of Justice.
Provinces.
1898.
1899.
1900.
1901.
1902.
Average.
$ cts.
1 11
0 324
0 20
0 16
0 11
0 06
0 03
$ cts.
1 15
0 31
0 19
0 144
0 13
0 044
0 03
$ cts.
0 69
0 32
0 194
0 16
0 104
0 054
0 03
$ cts.
0 59
0 30
0 19
0 17
0 12
0 05
0 03
$ cts.
0 61
0 37
0 194
0 20
0 14
0 06
0 03
$ ets.
O 83
0 324
Ontario	
0 19g
0 1677tj
0 12
0 061
0 03
For Hospitals and  Charities the per capita expenditure is five times the average of the
other Provinces, as the following table indicates :—
Annual Expenditure per Head for Hospitals and Charities.
Provinces.
1898.
1899.
1900.
1901.
1902.
Average.
$ cts.
0 32
o 134
0 09
0 07
0 064
0 02
$ cts.
0 36
0 13
0 09
0 064
0 064
0 02
$ cts.
0 31
0 13
0 09
0 07
0 074
0 02
$ cts.
0 46
o 124
0 09
0 11
0 07
0 02
$ cts.
0 45
0 164
0 10
0 07
0 07
0024
$ cts.
0 38
0 13A
0 091
0 07, \
New Brunswick	
0 06A
0 02 D 32
Inter-Provincial Conference, Ottawa.
1907
Taking together these four services, it is found that the cost to British Columbia per head
of the population is over nine times that of the average of all the other Provinces, as the
following table shows :—
Average Expenditure per Head for Five Years, 1898 to 1902.
Provinces.
Roads, etc.
Civil
Government.
Justice.
Hospitals,
etc.
Total.
British Columbia	
$ cts.
2 91
0 61
0 384
0 081
0 19ft
0 06ft
0 20ft
$ cts.
1 06
0 08*
0 06
0 16ft
0 154
0 121
0 04|
$ cts.
0 83
0 01
0 16ft
0 324
0 12
0 19f
0 03
$  cts.
0 38
0 02
0 06ft
0 02§
0 07ft
0 091
0 13ft
$  cts.
5 18
0 78
0 68ft
0 60ft
0 544
Ontario	
Nova Scotia	
0 47ft
0 42
Average     0 69ft
Average of alt the Provinces other than British Columbia     0 53ft
Taking the total per capita expenditure for all the Provinces for all services for the five
years, 1898-1902, it will be found from the table below that British Columbia is nearly five
times that of the average of all the other Provinces, and that the difference between British
Columbia's annual per capita expenditure of $12.61 and that of all the Provinces (including
British Columbia) of $2.66 is the yearly sum of $9.95 per head of the population, or requiring
the yearly sum of $1,706,222 to place it on all fours with the rest of the Provinces.
Total Expenditure for All Services in All Provinces for Five Years.
Provinces.
Average
Population for
5 years.
Total
Expenditure
for 5 years.
Amount
per head per
year.
171,489
245,469
103,687
1,636,454
330,377
458,882
2,177,751
$
10,813,905
5,132,134
1,526,494
22,057,010
4,027,154
4,815,300
19,969,942
$
12 61
Prince Edward Island	
4 18
2 944
2 694
2 44
2 10
1 374
5,124,109
68,341,939
2 66
Lastly, from the subjoined table of the total expenditures for all services of all the Provinces for the 30 years, 1873-1902, it will be found that British Columbia's per capita expenditure is over five times the average of all the Provinces, and that the excess of British
Columbia's per capita annual expenditure over that of the average of all the Provinces is
$9.54, or very little less than the excess of the five-year period, showing that the excess was
constant throughout the whole period. 7 Ed. 7
Inter-Provincial Conference, Ottawa.
D 33
Total Expenditure for all Services in all Provinces for Thirty Years.
Provinces
Average
Population for
30 years.
Total
Expenditure
for 30 years.
Average
per head per
year.
90,634
123,801
104,062
1,421,994
314,802
1,961,260
434,585
%
32,243,068
16,025,974
9,179,906
104,027,881
20,381,060
105,798,513
31,525,863
$ cts.
11 86
4 31
2 94
2 44
2 16
1 79
1 65
4,451,138
309,182,264
2 32
The striking inequality in expenditures disclosed by a comparison between British
Columbia and the other Provinces, and the similarity, amounting almost to uniformity, shown
to exist among the latter, point unmistakeably to some cause permanently operating in this
Province to account for the difference in results.
It is impossible, having in view all the facts, to escape the conclusion that this permanent
cause is the vast area of mountainous surface in British Columbia, which enters as a controlling factor into every branch of Provincial administration.
The second cause which operates disadvantageously towards British Columbia is its
position in relation to other Provinces and other countries, which adds, as additional imposts,
long-distance freights to the first cost of articles imported for use and for local manufactures;
and also minimises to an unusual degree the advantages to be derived from inter-provincial
trade, which was the commercial object of Confederation.
In regard to freights, the matter was dealt with in the report of the first delegation of
1903, as follows :—
" In Eastern Canada—in what we may call old Canada—the cost to the consumer, conveyed from points of entry like Montreal, Toronto, Halifax and other cities, varies from the
nearest points to the most distant, from 121 cents per 100 lbs. to 50 cents. It may, in exceptional cases, reach 75 cents. The official through rate from eastern distributing or terminal
points to western terminals varies, according to the classification of goods, from $2 to $3.25
per 100 lbs. What are known as commodity rates, to meet competition from New York to
San Francisco and other Coast points, are, however, lower than that. In addition to that,
while the consumer in the east only pays one local rate, the people of the interior not only pay
the through rate to the Coast, but the local rate back again, which, in some cases, equals the
through rate."
In regard to inter-provincial trade, it has been set out by Mr. George Johnson, Statistician for the Dominion, in this way :—
Trade of the two Central Provinces with the other Provinces  $150,000,000
.1                             .i                  with each other  115,000,000
ii          three Maritime Provinces with each other  30,000,000
ii          Western Provinces and Territories with each other . . 20,000,000
Total   $315,000,000
Or say, $60 per head.
The products of British Columbia, which are exported to other Provinces, though
extremely limited, consist chiefly of lumber, shingles, fish and fruit, and of goods to the
Yukon. From the latest available statistics these are estimated in value at $3,000,000, or 1
per cent, of the whole inter-provincial trade of Canada. Thus, this Province having 3 per
cent, of the whole population, pays 8 per cent, of the price of Confederation, and gets in
return 1 per cent, of its trade benefits.
The third head under which our disadvantages in Confederation are compared with the
other Provinces is the non-industrial character of the population, which arises out of conditions unfavourable to manufacturing as developed in Eastern Canada.     The special products D 34 Inter-Provincial Conference, Ottawa. 1907
of British Columbia—mineral, fish and lumber—are not the raw materials which enter into
the manufacture of dutiable goods most largely consumed in the Province. This condition
accounts for the larger percentage of goods imported, which increases the contributions to the
Federal Treasury so disproportionately. An analysis of the census returns of 1901 show to
what unusual extent the population of British Columbia is employed in mining, lumbering and
fishing, and relatively to what limited degree it is engaged in agricultural pursuits and manufactory, with corresponding results in the nature of their respective products.
And, lastly, as a consequence of the limited market for special products of British
Columbia in the east from wdiich its people buy so extensively, a market has to be found for
these in Great Britain and foreign lands, where they come in competition with the cheap
labour products of the world. Adopting the language of a former memorial : ' We have had
to pay long distance freights on both what we bought and sold, we have been obliged to
reverse the order of successful business principles and buy in the dearest market and sell in
the cheapest.' Under this handicap have our present industries been created, and in regard
to others, such as the manufacture of iron and steel and of pulp and paper, the natural conditions for which are so favourable, and whose development is nationally so important, the
securing of profitable markets so far from the centres of population is by far the most serious
of the problems to solve in their undertaking.
The foregoing are the grounds, mainly, upon which the Government of British Columbia
appeal for special consideration to the Dominion authorities, in connection with the proposed
re-adjustment of financial relations as between the Provinces and the Dominion.
They indicate in themselves the nature of the relief sought as compensation for a combination of disadvantageous conditions, incident to physical characteristics and geographical
situation.
The first render it impossible for the Provincial administration to carry on its ordinary
expenditures necessary under the Terms of Union and provide for the further adequate development of an immense area still largely unpeopled. In an experience of thirty-three years
the Province has but once in its history produced a surplus of revenue over expenditure, and
has in the same time accumulated deficits amounting to about $10,000,000, during which its
financial requirements have been insufficiently met even by the aid of loans.
The second has resulted in the excessive contribution of $17,000,000 to the Federal
treasury for which no benefits have been received, and placed the Province at a serious
disadvantage in respect to its-share of inter-provincial trade, foreign commerce and the.
development of native industries.
The Government in 1903, in asking for a commission of inquiry of the character suggested,
deemed it to be an eminently fair proposition, inasmuch as it would put the burden of proof
on the Province itself, place the consideration of the questions involved beyond the sphere of
political influence, and guarantee the fullest and most impartial investigation.
In the event of a settlement satisfactory to both not being possible by a friendly
conference between the Governments, the Government of British Columbia still adhere to the
proposal for a Commission as an alternative. It is submitted that in no other way can so
complete and unbiased an examination of those claims be made as by reference to an independent tribunal. If by such reference the contentions of the Province be sustained, the duty
of the Dominion Government will be obvious: if the report be unfavorable to those contentions, then the subject will be forever removed from the arena of controversy.
No. 1.
(Note to the foregoing Tables of Revenue and Expenditures.)
It will be observed that by the method adopted in extracting the contributions by the
Province to the Dominion, and the expenditures by the Dominion in and on account of the
Province, from the Auditor-General's Report, there has been no effort made to distinguish
expenditures charged to 'capital' and 'income' respectively, which, in some instances, would
materially reduce the sum to be charged to the Province in a single year, as the account
would take cognizance of interest only. To adopt a strictly accountant system, although
materially reducing the amount chargeable to the Province each year, would greatly involve
the process of arriving at a final result.
It will also be observed that the statement is more than fair to the Dominion, inasmuch
as the expenditure includes such large items as quarantine,  fishery protective service,  main- EXPENDITURE  BY THE  DOMINION ON ACCOUNT OE THE PEOVINCE  OE B. C, 18T2-1905.
1872-73.
1874.
1875.
1876.
1877.
1878.
1879.
1880.
1881.
1882.
1883.
1884.
1885.
1886.
1887.
1888.
1889.
1890.
1891.
1892.
1893.
$44,890
3,792
9,000
39,268
42,548
9,320
20,633
770
1894.
1895.
1896.
1897.
1898.
1899.
1900.
1901.
1902.
1903.
1904.
1905.
Total, 34 years.
Public Debt           ... 	
$ 166,620
$ 105,209
10,671
9,000
42,717
15,864
$ 105,003
10,425
9,000
30,592
8,036
$ 105,120
7,528
9,000
40,528
8,548
$ 110,912
10,414
9,000
37,566
7,117
$116,543
9,764
9,000
32,525
29,336
$130,427
8,875
9,000
35,604
26,333
$121,180
8,515
9,000
32,852
15,196
$121,604
6,960
9,000
32,232
16,162
$118,030
7,208
9,000
24,750
15,970
$516,986
10,073
9,000
27,353
19,848
$57,188
8,046
9,000
28,160
28,207
$47,858
7,930
9,000
31,114
27,746
$39,817
8,062
9,000
31,028
32,894
$49,454
8,648
9,000
31,309
34,606
$46,539
9,166
9,000
31,228
33,000
$79,034
6,801
9,000
30,415
35,190
14,023
1,769
5,650
$43,265
5,210
9,000
35,815
41,736
9,163
1,656
5,854
$44,055
3,854
9,000
39,840
37,840
10,381
2,056
7,061
$44,172
4,114
9,000
40,515
36,712
14,142
3,791
4,733
$38,008
7,219
9,000
38,840
43,650
9,720
10,320
$ 2,251,914
208,012
288 000
$3,696
9,000
36,199
43,358
8,863
15,980
$3,700
9,000
37,552
37,190
3,762
8,017
$3,767
9,000
43,896
39,919
8,735
18,390
$3,764
9,000
43,322
40,269
8,735
18,391
$ 3,862
9,000
43,578
42,074
8,593
17,529
$ 3,782
9,000
49,130
40,447
10,856
22,879
$ 4,238
9,000
42,513
42,150
7,007
31,978
$ 4,357
9,000
49,138
42,049
10,383
45,798
$ 4,546
9,000
50,208
46,953
8,029
31,478
$ 4,449
9,000
55,774
44,162
7,751
25,686
$ 4,576
9,000
52,615
50,274
9,241
27,740
3,421
25,927
53,984
108,366
136,639
64,078
183,407
1,148
20,000
64,919
109,345
6,380
9,338
4,705
3,926
17,918
42,292
61,676
148,849
307,077
15,687
136,030
26,762
3,435
866
12,937
160,936
2,870
115,964
Administration of Justice, Judges, &c . . .
67,197
1,285,373
1,025,384
158,704
311,442
43,772
633,466
395,897
2,113,552
445
920
1,445
1,000
1,762
1,000
1,800
1,200
1,899
1,463
5,000
5,200
500
* 472,330
15,442
33,069
93,946
31,688
17,305
1,989
5,000
20,065
42,530
2,876
5,186
3,641
27,670
21,272
102,080
70,787
16,299
20,935
2,091
5,000
23,350
39,029
4,235
4,194
4,040
27,830
35,594
156,816
94,754
95,894
65,337
1,015
5,000
25,132
34,343
4,593
5,299
5,040
35
17,866
20,000
17,710
119,443
242,689
16,139
106,956
20,806
2,072
912
11,831
211,575
164,365
128,140
14,000
t 29,865
30,910
27,835
35,689
202,969
69,468
96,475
49,540
1,317
4,904
29,961
45,357
4,355
8,240
4,900
968
18,561
40,122
16,274
129,709 1
307,077
20,962
104,531
22,269
2,697
1,140
13,278
220,765
88,608
119,058
25,203
25,466
29,524
138,918
69,718
39,682
31,374
1,193
20,000
26,826
42,668
4,590
6,160
4,382
423
20,808
36,239
23,746
138,516
307,077
38,061
110,743
22,896
3,481
926
15,179
206,953
260,970
113,341
26,408
28,390
160,221
138,626
40,805
124,637
920
19,931
28,068
48,038
4,812
7,423
5,510
210
15,056
43,515
25,041
137,596
307,077
18,448
136,930
23,390
3,638
868
12,855
220,710
228,193
109,987
Militia	
Public Works:
529
92,415
101,156
3,219
46,888
9,517
27,543
6,840
92,949
5,873
48,782
4,000
567
31,109
2,063
53,883
16,096
17,433
5,011
3,015
6,241
816
710
48,518
2,496
54,000
8,460
15,153
5,615
13,078
10,610
15,758
35,578
2,819
54,000
9,735
15,577
7,474
15,483
1,934
7,545
40,357
2,595
29,270
9,040
25,999
7,827
13,839
3,284
2,114
38,646
2,196
17,640
8,455
17,804
5,274
26,902
3,070
10,497
30,516
2,811
17,640
25,484
17,349
7,009
33,967
18,203
37,951
37,190
2,750
17,640
16,432
18,086
6,856
36,792
6,564
20,095
38,385
2,685
17,640
11,650
18,218
6,098
17,035
6,116
17,457
45,004
3,998
17,640
13,625
11,549
6,000
35,978
16,351
15,000
16,528
4,000
17,640
12,000
15,000
6,229
24,225
29,918
17,994
6,433
4,539
13,230
12,254
24,644
5,113
13,906
52,900
14,711
16,400
4,500
14,700
8,394
16,630
9,263
38,090
56,985
14,413
24,841
5,300
19,707
11,261
16,358
100
3,123
1,748
4,584
49,128
53,842
19,404
16,071
5,500
17,640
65,102
33,692
1,514
3,423
2,523
12,195
39,334
59,768
23,374
15,600
6,352
17,640
25,689
34,144
1,325
3,570
2,196
5,235
111,790
80,622
18,000
15,675
4,998
17,640
47,745
24,457
1,500
2,018
2,550
5,500
135,771
93,763
53,144
11,852
1,860
17,640
20,627
27,277
1,500
3,913
2,083
6,000
35,678
71,194
21,848
16,455
2,131
5,000
18,879
28,663
1,500
4,872
2,396
6,500
69,944
27,368
10,777
3,556
2,279
5,000
29,480
24,770
1,500
5,804
3,234
11,000
117,813
25,530
21,000
10,056
2,200
5,000
22,972
34,143
1,500
4,465
2,887
15,000
69,952
117,720
30,258
12,607
1,791
5,000
23,000
31,718
2,000
4,415
2,900
Harbours and Rivers	
1,515,546
811,025
8,736
29,021
2,530
54,000
10,556
32,708
22,607
46,818
2,577
54,000
41,797
27,228
17,732
37,329
2,502
54,000
19,157
28,186
5,122
34,164
2,688
54,000
12,701
14,456
1,151,244
89,833
jxgciiijy	
731,025
Marine and Fisheries:
718,912
960,930
28,378
44,280
1,231
3,882
336
3,408
1,175
3,093
3,837
1,085
4,167
3,007
3,053
3,162
3,906
341
3,969
2,905
230
3,144
1,475
3,450
1,500
3,479
1,830
3,853
2,142
134,989
65,954
5,562
198,731
635
686
1,424
1,400
5,192
1,599
4,100
2,232
1,437
1,879
3,500
3,632
4,334
3,634
4,321
6,158
5,491
5,283
6,219
6,227
8,509
8,508
8,460
13,662
182,168
213,391
2,526,326
51,989
212,151
14,455
30,733
5,857
1,395
366
45,562
85,965
48,284
212,151
13,440
30,320
7,031
512
210
363,632
109,287
61,834
212,151
10,340
32,382
7,082
600
250
207,308
149,669
2,525
66,834
212,151
10,350
42,422
7,646
1,267
413
97,372
165,851
1,450
82,923
212,151
10,340
42,821
7,463
292
181
7,949
174,658
13,188
102,074
212,151
10,195
42,827
6,378
295
90
19,870
161,785
13,250
88,056
212,151
9,488
49,389
6,606
239
80
14,766
177,160
13,703
90,022
242,242
10,983
51,808
11,823
2,128
495
16,591
147,967
28,805
106,883
242,242
10,500
56,143
13,252
1,518
536
4,784
150,000
70,150
107,082
243,585
10,500
60,734
14,374
1,929
641
10,016
170,000
29,357
2,869
101,536
242,689
9,750
62,228
14,578
1,939
902
10,420
202,308
21,037
2,817
91,542
242,689
9,774
65,219
15,522
2,160
900
12,355
196,263
25,137
3,390
92,310
242,689
8,730
66,770
16,242
904
884
10,770
235,489
31,150
2,389
112,936
242,689
7.350
78,196
18,293
577
478
11,746
225,000
30,600
3,736
109,796
242,689
7,350
93,216
18,793
2,157
1,025
11,957
227,781
51,130
3,033
114,878
242,689
6,986
99,555
20,901
2,284
772
13,262
197,036
49,628
12,989
29,000
330,294
25,000
225,050
25,000
218,247
25,000
208,217
57,200
208,094
45,532
208,094
41,561
208,086
42,318
208,019
43,000
207,366
43,732
207,996
45,891
207,996
366,000
7,493,716
269,826
Customs  	
Inland Revenue:
11,542
1,286
19,634
6,137
19,056
5,318
23,323
6,208
23,094
5,683
21,365
5,805
22,308
5,766
411
150
21,168
5,664
165
165
21,884
5,523
707
120
22,503
5,720
594
175
22,546
5,708
419
150
25,489
6,160
543
151
1,753,865
372,942
38,358
13 846
924 440
Post Office	
68,687
70,056
60,378
63,049
60,230
69,777
47,979
63,411
61,028
64,206
76,268
4,598,995
1,126,116
599,479
39,203
680,367
352,281
53,967
1,204,549
Chinese Immigration Inquiry	
Rounty on Minerals	
t 76,665
16,729
t 43,185
22,481
$ 4,380
19,774
14,994
t 195,627
18,021
10,583
£330,645
17,771
8,965
192,803
1,027
370
1,344
900
1,445
6,000
5,175
17,531
19,425
632,085
1,075,907
750,796
1,058,856
892,112
1,129,694
831,302
744,341
768,185
683,586
686,997
704,262
679,638
677,226
689,893
972,605
896,364
929,640
1,005,809
1,011,730
1,167,581
1,188,461
1,008,187
960,038
1,106,110
1,183,779
1,741,187
1,320,417
1,848,847
1,909,913
1
1,929,222
2,288,354
2,359,709
38,037,382
* To date.
t Silver.
: Lead. STATEMENT   OF   REVENUE   CONTRIBUTED   BY   BRITISH   COLUMBIA   TO  THE   DOMINION.
1872-3.
1874.
1875.
1876.
1877.
1878.
1879.
1880.
1881.
1882.
1883.
1884.
1885.
1886.
1887.
1888.
1889.
1890.
$1,084,657
55,319
138,041
295
90
1891.
1892.
$1,412,162
165,853
237,043
312
54
1893.
$1,219,598
111,227
247,584
377
269
1894.
1895.
1896.
$1,399,017
88,800
294,172
385
409
1897.
1898.
1899.
1900.
1901.
1902.
1903.
1904.
1905.
Total, 34 years.
Customs	
$660,302
$337,970
$415,317
$490,226
$406,731
$428,239
$517,592
$452,508
$601,622
$685,106
$911,267
$886,884
$969,296
$883,888
11,693
87,073
1,224
830
$887,376
6,350
93,046
1,852
757
$859,453
15,532
87,530
1,517
816
$976,504
40,353
110,709
1,651
850
$1,359,269
107,472
152,891
339
80
$1,193,528
105,022
242,000
478
728
$1,057,752
69,575
251,785
343
685
40
690
$1,544,753
121,619
327,000
437
362
$2,295,364
107,852
420,510
577
478
752
1,225
$2,092,472
215,010
512,223
475
445
780
119
$2,321,515
195,102
507,493
792
545
1,221
305
135
186,808
2,226
6,660
4,664
1,622
1,684
9,078
162
707
1,808
53,195
2,237
31,161
$2,329,479
162,050
480,398
395
562
1,342
265
148
193,754
8,746
12,348
4,150
616
1,562
10,376
5,606
1,085
1,571
52,960
2,483
22,439
$2,314,619
346,600
471,233
832
545
1,591
358
133
212,605
42,566
14,502
5,549
1,691
1,384
11,899
6,401
865
864
41,179
1,320
75,627
$2,400,636
517,700
472,842
893
574
2,091
453
117
204,930
43,974
13,669
4,165
791
1,838
12,575
6,118
1,348
1,636
43,016
1,352
60,430
1,411
69
$2,717,789
450,000
505,206
1,020
571
2,824
1,212
191
235,440
50,947
9,881
3,792
1,041
1,801
11,194
2,177
1,035
3,775
56,904
1,393
57,463
1,322
38
$2,788,175
$40,910,066
Chinese Immigration
2,893,129
6,587,911
Inland Revenue :
Excise	
7,181
10,657
11,226
14,957
20,300
25,000
1,132
179
32,095
1,092
35,225
1,092
46,448
2,259
57,055
1,231
68,156
1,065
57,967
1,004
62,643
1,564
1,075
500,222
1,200
663
3,436
1,333
153
261,181
30,095
4,633
3,877
1,972
1,794
10,023
1,126
781
7,995
47,436
1,341
47,461
1,481
129
Weights and Measures	
25,833
11,567
14,077
7,938
1,407
3,459,891
Gas Inspection ..                    	
Electric Light Inspection	
Methylated Spirits
55
155
524
1,244
530
204,219
1,367
7,515
Sundries                             	
14,704
9,748
11,545
14,157
17,882
20,805
20,517
19,914
24,691
25,682
33,408
39,918
47,859
51,027
8,500
62,791
75,597
65,407
79,336
115,051
127,635
136,748
148,684
961
10,787
140,126
907
6,338
161,645
907
10,222
247,282
1,830
62,228
248,795
2,204
10,316
Public Works :
Telegraphs	
295,853
Esquimalt Graving Dock	
5,337
14,812.
13,566
29,467
18,416
23,204
273,901
Casual	
26,197
Experimental Farm	
17
653
4,747
1,647
69
79
489
6,150
1,738
127
67
472
6,451
1,946
131
563
450
639
7,130 .
2,166
189
2,953
409
607
7,216
2,358
117
457
357
6,792
2,128
418
589
869
6,726
2,430
475
52
26,411
530
863
8,056
2,727
719
1,101
771
8,558
7,012
25
47,865
675
1,482
8,247
6,612
859
12,107
Penitentiary, etc ....                	
39,043
502
236
51
2,843
461
109
2,250
606
20
3,083
682
39
3,109
588
141
3,355
873
1,041
3,098
1,191
1,089
2,808
928
2,456
3,851
941
715
4,890
936
195
5,278
1,125
62,164
Marine and Fisheries :
Sick Mariners' Fund	
975
66
600
406
450
2,612
342
2,866
621
182,500
Steamboat Inspection	
63,406
Examination of Masters and Mates ...
8,925
Casual and Harbours	
252
12,449
3,085
12,440
12,600
62,068
Fisheries	
23,517
39,888
45,802
* 42,763
42,202
593,495
Superannuation	
52,889
Dominion Lands and Timber	
36,154
37,424
64,508
60,225
71,232
71,798
49,927
36,772
35,000
26,806
33,853
860,482
Vancouver Assay Office	
4,214
80
,     125
100
541
Public Debt  	
27,229
4,613
8,690
461,485
5,550
6,111
8,125
21,230
10,091
530,273
6,150
6,150
52,422
1,079,346
14,654
22,162
15,000
15,633
1,088,597
15,695
15,157
14,628
1,468,941
15,040
15,604
16,049
315,983
1,598,682
2,028,633
749,449
386,599
549,403
460,679
494,965
601,193
692,776
788,181
1,013,424
1,118,795
1,064,983
1,111,107
1,275,881
1,861,331
2,066,188
1,880,800
1,788,160
2,288,635
3,237,283
3,231,481
3,329,200
3,292,460
3,552,463
3,792,628
4,117,016
1
3,717,507
56,717,544
* To date
, 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 35
tenance and construction of lighthouses, defences of Esquimalt, and militia, which, strictly
speaking, are matters of national benefit, and are in no sense local or provincial, any more
than similar services on the Atlantic coast would in a similar statement be charged to Nova
Scotia or New Brunswick.    They are, however, incidentally of local benefit and are included.
In addition to that the cost of the Indians is included in 'expenditure,' although the
Province has no moral or legal responsibility in that connection. It is to be borne in mind,
too, that the Province gave to the Dominion for the use of the Indians over 525,000 acres,
which being in every instance the best land available, is worth at the lowest estimate $10 an
acre, at the present time, for reserves. Of course, in the case of the total dying out of the
Indians, the reserves will revert to the Province.
To absolutely adjust such an account equitably would require the services of a commission,
as the proportionate cost of government and a great many other things would have to be
taken into consideration; but in a general way the results are given in the tabulated statements hereto attached.
No. 2.
(From Ebport op Dunsmuir Delegation, 1901.)
Since 1872, the revenue contributed by British Columbia to the Dominion up to July 1,
1901, will have, amounted to, roundly, $42,000,000. Taking the average of the population for
the three census periods, 1871 to 1881; 1881 to 1891; and 1891 to 1901, at 81,000 and that of
all Canada at 4,500,000 for the same periods—had the whole of the people of the latter contributed in the same ratio per capita, the revenue would have amounted to $2,333,250,000
instead of $886,360,000.
In other words, JT of the population has contributed about J^ of the revenue of Canada
in 30 years.
Conversely, if the contribution of British Columbia, for that period, had been on the
same basis as the rest of Canada, it would have amounted to only $15,957,000.
Taking the population at 5,250,000 and 125,000, respectively, the per capita contribution
of all Canada in 1899 was $8.93 per head, and that of British Columbia $25.67 per head.
If the revenue from British Columbia had been in the same ratio as the rest of
Canada, it would have amounted to only $1,116,250, instead of $3,194,808.
Taking the customs and excise alone, which amounted in 1899 to $34,958,000 for the
Dominion, and $2,627,500 for the Province, on the same basis of population, the per capita
contributions are $6.65 and $21.02. Had the whole population of Canada contributed in the
same ratio as British Columbia, the taxation derivable from inland revenue and customs would
have been $110,250,000, instead of $34,958,000.
Conversely, if British Columbia had contributed in the same ratio as the rest of the
Dominion, the revenue from British Columbia from these sources would have been only
$831,250.
In 1899 our Provincial contributions to the Dominion treasury, from all sources, were
$3,208,788 ; and our share of all expenditure by the Dominion was $1,334,618.
If the whole of Canada had contributed in the same ratio, the revenue of Canada for that
year would have been $134,767,000 instead of $46,741,250.
No. 3.
COST OF ADMINISTRATION.
(From Report op Prior Delegation, 1903.)
In regard to No. 1, I have only to exhibit this map to illustrate what I mean by the
physical character of the country increasing the cost of administration. The whole interior of
the Province of British Columbia is more or less mountainous, and the valleys or agricultural
parts suitable for settlement are few and far apart. The settlements that have taken place
through mining development are also widely distributed and found often in very inaccessible
places. In fact, without going into a long description of conditions, with which everybody
who has been in the country is familiar, the cost of building roads to connect these various
settlements, sometimes over mountain tops, or along their steep sides, through rock, etc., is D 36
Inter-Provincial Conference, Ottawa.
1907
very expensive; and in many instances the expensive means of communication which it is
necessary to provide only serve a comparatively few people, from whom there is anything but
adequate revenue to be derived.
It is necessary, too, to provide educational facilities, supply officials in various capacities,
build public buildings ; in short, supply all the facilities that would be necessary in a thickly
settled community. This is not only true of the interior, but also of the coast, where the
thickness of the forest, the denseness of undergrowth and great size of the trees make it still
more expensive to clear and grade roadways.
As you will see by this map, we have only begun to touch the rim of the Pi'ovince, and
yet the Government has, according to a statement prepared for me by the Govei'nment
engineer, who says it is well within the mark, built 6,000 miles of road, at a cost of $12,000,000,
and 5,000 miles of trails, at a cost of $1,000,000, or $13,000,000 in all. Now, to give the rest
of the Province still undeveloped a similar system of communication, will cost I do not know how
many times more. Few of these roads can be considered as finished roads at that. They are,
as a rule, nine or ten feet wide, simply graded roughly, and constantly being repaired and
improved. There are also numerous bridges and culverts to be constructed, which are very
expensive indeed. I am submitting the particulars of a few roads that have been built of late
years, to give you an idea of the cost in different districts, as follows :—
Main Waggon Road.
In East Kootenay	
Revelstoke	
Slocan Riding   	
Yale (West)	
„    (East)   	
Richmond (Coast)	
Rossland	
New Vancouver (Coast)
Length.
20
4-1
12*
4
1.8
9
Width.
9
10
9
10 to 12
12 to 14
16 to 22
10
12 to 16
10
feet.
Cost
per Mile.
$1,000
3,350
1,600
4,544
1,700
2,000
1,185
2,220
1,510
All of these are still under construction.
The physical configuration of the country, therefore, greatly increases the cost of government. Population can never be concentrated or compact, and, as a consequence, the cost of
the individual factor of population is proportionately very much greater than in the Eastern
Provinces. The revenues, as a consequence, to be derived must be very much less in proportion to the area, or the individual must be taxed very much higher. One or both of these
results invariably follow.
I have made a comparison of the cost of the various services in the different Provinces
under different heads, ">s nearly as they could be grouped from what appears in the public
accounts, and the result is as follows, which is substantially correct, though subject to correction in some details :—
B. C.
Man.
256,000
$0 52
0 18
0 90
5 01
4 00
Ont.
Que.
N. B.
330,000
$0,055
0.095
0 11
0 24
0 60
1 92
2 40
N. S.
P. E. I.
Population (in round figures)	
180,000
$ 1 20
0 95
0 25
0 60
2 44
5 56
11 62
2,185,000
| 0 20
0 13
0.065
0 38
0 12
1 91
1 85
1,650,000
$ 0 33
0 18
0 09
0 31
0 65
1 91
2 70
460,000
$0 16
103,250
$0 16
Legislation	
0 11
0 36
0 34
1 81
2 04
0 07
0 30
0 70
Education (1891)	
1 44
Total cost of Administration	
3 00 7 Ed 7 Inter-Provincial Conference, Ottawa. D 37
There is still to take in the cost of Municipal Government. As it happens, there are only
two Provinces which compile municipal statistics, Ontario and British Columbia, but for our
purposes Ontario may be taken as fairly representative of the others. The cost of Municipal
Government, according to latest published returns of the Ontario Department of Statistics, is
$6 per head of the population. We have now the basis of a perfect comparison between
British Columbia for the year 1901, in respect to the cost per head for Governmental purposes,
and it is as follows :—
Ontario. British Columbia..
Provincial $ 1  85 $12 60
Municipal      6 00 1  75
Customs (average for Dominion)         5 28 16 00
Excise      2 00    (Included in Customs.)
$15 13 $30 35
There are two important distictions to make in the case of British Columbia, as compared with Ontario, and to some extent with the other Provinces, and they are that owing to
the municipalisation in the East, a very large burden of responsibility is thrown upon the
Municipalities which in British Columbia is borne by the Province; and that, owing to the
character of the population in British Columbia, which includes 45,000 Chinese, Japanese and
Indians, who contribute to the general revenues in a very insignificant degree, the whole of
the taxation falls on a population equivalent to about 50,000 ad%dt white male population, or
an amount of over $100 per head for all purposes per annum. The above comparison is,
therefore, greatly increased as against British Columbia, and exceeds, all round, the ratio of
three to one. This is a condition of affairs arising out of our peculiar physical characteristics
and geographical situation for which we claim special consideration.
To illustrate more clearly the effect of the physical configuration in the cost of administration, I have here a table showing the expenditures and receipts in three of our large outlying districts, covering a period of five years. The expenditures include the cost of salaries
of officials in the districts, of education, hospitals and charities, works and buildings, roads,
streets and bridges, surveys and miscellaneous, but not of the administration of justice, of
legislation, the interest on public debt, the general expenses of civil government, and many
other large items of expenditure which cannot be apportioned to districts. The revenues
include all the revenues which arise out of the respective districts.    The totals are:—■
For Five Years, 1896-7 to 1900-1.
Expenditures. Revenues.
Cassiar $311,908 94 $323,038 37
Cariboo    340,007 85 307,832 04
Yale    727,323 83 683,480 50
$1,371,240 62 $1,314,350 90
From the results shown in the above five years' experience, it will be seen how far short
the ordinary revenue is of the ordinary expenditure in such large districts. The revenue
includes all sources of money supply, while the expenditure only includes the appropriations
within the districts.
As another illustration of how the financial situation works out in new districts. Last
year there was a proposal to settle one hundred families in the fertile valley of the Bulkley
River, south of Hazelton, on the Skeena River. The members of the colony, as inducements,
asked that the Government should assist them in taking in their families and effects, to give
them 320 acres of land free for each family, to build a road from Hazelton to the settlement,
75 miles in length, and build schools, etc. Upon making an estimate, the initial cost for the
first five years was as follows :—
Road from Hazelton, 75 miles   $75,000 00
Two school-houses '.         5,000 00
One Government building.    ,      1,200 00
Cross-roads      5,000 00
■ ■ $ 86,200 00 D 38 Inter-Provincial Conference, Ottawa. 1907
In addition to this, to be taken into account, were :—
The salary of two teachers $ 1,800 00
The salary of one Government official      1,200 00
Or a total in five years of           15,000 00
Grand total outlay in five years , $101,200 00
The greatest possible revenue that could have been reaped in return would have been :—
Poll tax,  at $3 per head per annum on 300 male adults $        900 00
Land tax, on a valuation of the Government price of land for
purchase, at $5 per acre. . . ,         1,200 00
$    2,100 00
Or in five years  10,500 00
At the end of five years, provided the land was pre-empted on
the usual terms, the Government would receive at $1 per
acre  32,000 00
Or a total of  42,500 00
As against an expenditure of over ,    100,000 00
Of course, in five years there would have been others added to the population, and in a 1
probability there would have been miscellaneous receipts under mining licences, etc., but there
would have been increased expenditure as well. This shows, in a practical way, what it costs
to open up new districts in British Columbia. In other words, unless mining development
accompanies settlement to increase the revenue, the ordinary settler, to use a homely expression, costs more than he comes to.
On the other hand, one hundred families settled there would have contributed at least
$2,500 per annum to the Dominion treasury, without the Government practically assuming
any responsibility in connection with them.
These are the practical problems which the Local Government have to face in British
Columbia, and is one reason why we claim the local sources of revenue are not sufficient to
meet the demands on the treasury as is, in fact, shown by the receipts and expenditures since
Confederation. I think I have shown you very clearly that we cannot administer the affairs
of the Province on a basis similar to that of the other Provinces, or anything like a similar
allowance for local expenditures,
No. 4.
Effect op Increased Population and Development.
The Hon. Mr. Parent, in presenting his case, remarked ;—
" The development of the Province has occasioned new expenditure."
" The larger part of this increase is due to various causes, which, notwithstanding all the
care given to the management of public affairs, it has been impossible to control."
" This increase in the population is inevitably a source of expenditure to the Provincial
Government, and, although it is incumbent upon it to neglect no means of attracting to this
Province and keeping therein a large population, it is unfortunately true that the accomplishment of this duty occasions a constant dhninution of its pecuniary resources.
" This increase in the population is directly responsible for the additional  cost for the
administration  of justice, the maintenance of the educational system,   the support of  the
prisons and asylums and the assistance given to educational and charitable institutions, &c."
*******
" On the other hand, the revenue of the Federal Government from $13,687,928, which it
was in 1868, increased to $51,029,994 in 1900. From the figures above given, it will be seen
that the customs and excise duties form a large portion of the revenues paid into the treasury
of Canada in consequence of their surrender by the Provinces."
*******
" In the majority of the Provinces it has become impossible by taxation to cover the
increased expenditure, and it appears to us that the only method of meeting all the public
requirements is to have the views above expressed accepted by the Federal Government."
* * * * * * * 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 39
"With the additional sums so placed at the disposal of the Province, we could encourage
education, agriculture and colonisation, aid in the development of our natui'al resources and
nascent industries, furnish, by practical instruction, the generations to come with the means
of engaging in economic struggles of the future, and supervise with more jealous care the
observance of the laws which ensure the security of persons and property.
" This expenditure would directly benefit the Government of Canada, which would be
more than repaid the sums handed over to us by additional customs and excise duties paid into
the public treasury by increased population."
*******
Hon. G. W. Ross, Premier of Ontario, took practically the same view. In his memorandum submitted he pointed out :—
" It is true that there is no compact that the subsidies should increase according to the
revenues of the Centi'al Government, although such a basis would be eminently fair, inasmuch
as the moneys (customs and excise) from which the subsidy is paid by way of refund for maintenance of Local Governments, is collected from the people of the Provinces, and, indeed, in
some respects such a basis for the payment of subsidies would be fairer than payment on the
basis of population, as being a refund in proportion to the amount collected.
" The present basis ignores the fact that while the increase of population lightens the
burdens of the Dominion inasmuch as it multiplies the contributoi'S to the revenue from
customs and excise, the increase of population adds to the burdens of the Provinces without
any corresponding contribution towards their maintenance. For instance, the Provinces,
through the central Government, are taxed for maintaining the Department of Emigration.
This department justifies its existence by increasing population from foreign parts, and the
Government is recouped for this expenditure through the customs and excise departments.
The Province, however, that has to provide for the education of these emigrants, for the
administration of justice so far as they are concerned, and for the maintenance of their
indigent or insane, has no means of recouping itself because of this increased expenditure
imposed on it through the Dominion except at its own expense. Surely this circumstance
must have been overlooked or the subsidies would not have been rigidly based on a fixed population, as has been the case."
*******
Hon. G. W. Ross goes on to point out that the very expenditure made by the Dominion
Government in building railways, canals, etc., though it increases the population of
Canada and the revenue of the Dominion, " the Provinces, so far as their administration of
the responsibilities devolving upon them by the Act, receive no benefit whatever, but rather
lose from this increase, as the charges by the Dominion government, which the people of the
Province have to meet in order to carry on these large undertakings, increase the difficulties
of the provincial governments in meeting the charges which the increased population imposes
upon them under the constitution.
"The Provinces are, in this way, subjected to a double charge: (1) To find the means,
through increased customs and excise charges, for public works undertaken by the Dominion;
and (2) to provide for the maintenance of the population which naturally follows in their wake."
No. 5.
BETTER TERMS ALLOWED TO PROVINCES.
Nova Scotia in 1868.
New Brunswick in 1873 was allowed $150,000 per annum as compensation for loss of
export duty on logs under the Treaty of Washington in 1871. Under the Terms of Union,
New Brunswick was permitted to impose this duty, which had been in force since 1842. It
has always been regarded, and really was, a very liberal settlement. It was arranged by Sir
Leonard Tilley, one of the New Brunswick representatives on the Dominion Government.
There was a general readjustment of terms in 1873, as the result of agitation in Ontario
and Quebec against the payment of interest on 10|- millions, by which amount the actual debt
of the old Province of Canada exceeded its allowed debt of $62,500,000 under the Union Act.
The following sums were allowed to be assumed by the general government as liabilities on
behalf of the Provinces :— D 40 Inter-Provincial Conference, Ottawa. 1907
Provincial debts at time of confederation $ 77,500,000
Debts subsequently assumed or allowed :—
Nova Scotia (better terms)  1,186,756
Old Province of Canada  10,506,089
Ontario  2,848,289
Quebec  2,549,214
Nova Scotia  2,343,059
New Brunswick  1,807,720
Manitoba  3,775,606
British  Columbia  2,029,392
Prince Edward Island  4,884,023
Total $109,430,148
Prince Edward Island in 1901 was allowed $35,000 per annum for failure to provide
regular communication, winter and summer, between the island and mainland, as per terms of
union. Communication at times is irregular, owing to hummocky ice in straits, which can
never be overcome, except by tunnelling.
Nova Scotia in 1885, in which the Government of Canada took over the extension line
railway constructed by Nova Scotia and paid therefor $1,324,042, purchased certain wharves,
and extended the line to Sydney as a work of general benefit. This line was afterwards
amalgamated with the Intercolonial system ; and in 1901 when a sum of $671,836 was placed
in the estimates in connection with claims of that Province (see Hansard Debates, page 5,892.)
New Brunswick in 1901 also received the sum of $280,692 (see Hansard Debates, page
5,941).
No. 6.
COST OF ROAD BUILDING IN BRITISH COLUMBIA.
STATEMENT  SHOWING   LENGTH,   WIDTH   AND   AVERAGE   COST   PER   MILE   OF   CERTAIN
WAGGON   ROADS.
East Kootenay, North Riding.
Toby Creek Waggon Road—
Length      20 miles.
Width graded, averages ,      9 feet.
Cost per mile (approximate)      $1,000.
Revelstoke Riding.
Columbia River Waggon Road—
Length      4J miles.
Width graded, averages . ,      10 feet.
Cost per mile (approximate)      $3,350.
Slocan Riding.
South Fork Kaslo Creek Waggon Road—
Length      12^ miles.
Width graded, averages ,      9 feet.
Cost per mile (approximate)      $1,600.
Yale,   West Riding.
Lillooet-Lytton Waggon Road—
Length  4 miles.
Width graded, averages  10 to 12 feet.
Cost per mile (approximate)  $4,544. 7 Ed. 7 Inter-Provincial Conference, Ottawa. D 41
Yale, East Riding.
Main Kettle River Road—
Length , ,      5| miles.
Width graded, averages      12 to 14 feet.
Cost per mile (approximate)      $1,700.
Richmond Riding.
Hastings-Barnet Road—
Length ,  4 miles.
Width graded, averages  ... 16 feet.
Width between ditches  22 feet.
Cost per mile (approximate)  $2,000.
Rossland Riding.
Norway Mountain WTaggon Road—
Length ,      6|- miles.
Width graded, averages      10 feet.
Cost per mile (approximate)      $1,185.
Westminster District.
Reformatory   Road,  (near Vancouver)—
Length   1.8 miles.
Width graded, averages  12 feet.
Width between ditches  16 feet
Cost per mile (approximate)  $2,220.
Chilliwhack Riding.
Mount Baker Waggon Road—
Length ,     9 miles.
Width graded averages      10 feet.
Cost per mile (approximate)         $1,510.
victoria, B.C.:
Printed Jty Richard Wolfbnden, I.S.O., V.D., Printer to the King's Most ExceiJent Majesty.
1907

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