(NO. 183.) SECOND READING. (Hansard, 8 July 1873)

THE EARL OF KIMBERLEY,
in moving that the Bill be now read the second time, said, that the purpose of the Bill was to guarantee the payment of a loan to be raised by the Government of Canada for the construction of public works, and to repeal the Canada Defences Loan Act, 1870. He would remind their Lordships that during the negotiations that resulted in the Treaty of Washington, the Dominion Government abstained from pressing their claim to compensation for the Fenian Raids, on account of the resolute refusal of the United States Government to entertain it; and they subsequently suggested that a guarantee by this country would be a mark of goodwill to Canada, and would facilitate the steps necessary to give effect to the Treaty. They also suggested that the guarantee authorized by the Canada Defences Loan Act, 1870, to the loan of £1,100,000 to be raised by the Dominion Government for the purposes of fortification and defences—no part of which had, however, been borrowed—should be cancelled or rather transferred to the execution of works of a peaceful character. They further proposed the commutation of a certain sum promised for armaments—bringing up the total sum proposed to be guaranteed to £4,000,000. Her Majesty's Govern- 5 ment agreed to transfer the guarantee of the sum for defences to the execution of works of a peaceful and productive character, but they did not think the sum for armaments could properly be included; and they ultimately agreed to propose a guarantee of £3,600,000—that was to say, of a further sum of £2,500,000 in addition to the £1,100,000 already guaranteed—to be expended in the improvement of canals and in the construction of a railway connecting the present railway system of Canada with the Pacific—connecting Canada with the Hudson's Bay territory, the North-west territory, and British Columbia. The Government, while thinking Canada bound to use its utmost efforts to defend itself—as it had gallantly done—thought this an exceptional case in which some assistance should be given; for the Fenian Raids, though as contemptible in their execution as they were wanton and unprovoked, and though repelled by the Canadians themselves with some help from the Imperial Government, involved an expense not to be measured by the actual injury perpetrated; and they were not directed against or caused by any Canadian policy, but arose out of the relations of this country with Ireland. However wise, moreover, it might be to abstain from guarantees, it must be remembered that the Dominion Government had undertaken the government of vast territories—a task which necessitated efficient means of communication throughout—and for this purpose this gigantic railway, which would be 2,900 miles in length, had been undertaken. The territory to be traversed had been described as barren, but there were few richer territories than the belt of the Saskatchewan. They were decidedly superior to Minnesota, whose progress had been unequalled in American colonization; and though the climate was rude there was no difficulty in producing corn and cattle. He believed a stream of emigration would before long be directed thither. The Dominion Government proposed to raise the sum of £8,000,000 sterling, to be expended in the construction of the Pacific Railway, and on the enlargement and improvement of the Canadian canals, and to make concessions of land for the line, the construction of which within 10 years was a condition on which British Columbia had acceded to the Confeder- 6 tion. The Imperial guarantee would enable Canada to effect a loan at lower interest than would otherwise be necessary, and her finances were in a condition which caused no misgiving as to her ability to bear the expense. It was not unreasonable, therefore, that we should to a certain extent help her with our own credit. The Canadian Government intended hereafter to construct the fortifications for which the loan of £1,100,000 was proposed; but they thought it inopportune to do this at a time when relations with the United States had been put on a mature and. amicable basis, and. one of the most eminent of Canadian statesmen (the late Sir George Cartier) had expressed to him strongly his opinion that the defence of a small portion of frontier would be useless until complete and efficient communications between the different parts of the Dominion had been effected. With respect to the allegation that this guarantee was a bribe to the Canadians to forego their claims upon the United States on account of the Fenian Raids, he altogether repudiated such an imputation. The Bill was the result of Imperial policy—it was based on sound and sufficient grounds, and would place Canada and the other provinces of the Dominion in a state of permanent peace and tranquillity. That policy was not attributable to any one party or Ministry in this country. It had been promoted by the noble Earl opposite (the Earl of Carnarvon), by his noble Friend the Secretary for Foreign Affairs when he was at the head of the Colonial Office, and by his right hon. Friend the Secretary for War; and since he had himself been at the Colonial Office he had done his best to carry it out. The Treaty of Washington was on the whole greatly beneficial to Canada—in particular the provisions that secured to the Dominion the free import of fish and fish oil into the United States. Canada, moreover, was interested in the settlement of the differences between England and the United States, and though this country had reserved its right to bring forward the Canadian claim at a future time, there was no outstanding question between the Dominion and the United States. Congratulating his predecessors and the country on the confederation of the North American Provinces, he would 7 further express his hope that the work would soon be completed by the adhesion of Newfoundland. He thought it a matter for congratulation to the colonists that they had thus risen superior to local jealousies; and he would conclude by inviting the House to show its goodwill to the Dominion, and promote the accomplishment of the work by passing the Bill.

THE EARL OF CARNARVON
said, he would join his noble Friend the Secretary for the Colonies in repudiating the unworthy suggestion that had somehow gained circulation, that this guarantee was in the nature of a bribe. He knew that the Government of this country—from whatever party it might be constituted—was incapable of offering any such inducement; and he was equally convinced that the Government of the Dominion was equally incapable of accepting one. It was a matter of Imperial policy, and was one of the conditions for the entry of British Columbia into the Confederation. He had no special love for guarantees, and if his memory did not deceive him the right hon. Gentleman now at the head of the Government and his Chancellor of the Exchequer had both in former times been eloquent in denouncing them; he should nevertheless give his support to the present proposition, believing that it was calculated to produce great advantage in consolidating the Empire. He did not think the proposed railway so doubtful a scheme as some people considered it; for, notwithstanding the enormous tract of country through which the line would pass, the engineering difficulties were few, while there could be no doubt it would open up a vast country of great fertility and mineral wealth. He dissented, however, from the noble Earl's opinion that the construction of the fortifications would be inopportune at the present moment; for notwithstanding the good understanding that now prevailed, he held that every country had a right to fortify its frontier without being supposed to menace its neighbours. He had doubts as to the propriety of the transfer of a former guarantee, though his last conversation with Sir George Cartier partly removed them; but he supported the Bill 8 in consideration of the difficulties under which Canada had accepted the Treaty of Washington, and the vast importance of the consolidation of the Confederation. When he considered, moreover, that the loan was to be borrowed by the Canadian Government on the security of the consolidated revenue fund of Canada, so that, should the railway prove a failure in a pecuniary sense the loss would not fall on us, he thought the guarantee might be given without much danger.

§ THE DUKE OF BUCKINGHAM AND CHANDOS
said, that having some personal knowledge of the subject from his former connection with the Colonial Office, and from his acquaintance with eminent Canadian statesmen, he desired to express his full approval of the Bill. He approved especially of the diversion of the guarantee, given for constructing fortifications, to the construction of railways and reproductive works. He had always regretted that the first step of the Canadian Government should be to apply her resources to the erection of defences, which, however valuable in a military point of view, could only protect isolated parts of the frontier. He maintained that the strength of the Dominion rested in developed resources, increased population, and perfect means of communication, and that a railway promoting these objects would be the best provision for a contingency which recent transactions, though not altogether to be approved, had made very remote.