APPENDIX E.*
(FROM SIR MACKENZIE BOWELL, PRIME MINISTER OF CANADA, TO THE EARL OF ABERDEEN, GOVERNOR-GENERAL OF CANADA.)
OTTAWA, 16th April, 1895.
MY DEAR LORD ABERDEEN,
Referring to our conversation
of yesterday afternoon, I enclose herewith a memorandum showing the financial
aspect of our negotiations with the Newfoundland delegates, from which Your
Excellency will learn the difficulties that lie in the way of our acceding to the
full request of the representatives of that colony. If these figures and
explanations are not sufficiently clear and elaborate, kindly let me know, and I
will furnish any other that Your Excellency may required.
Canada is very desirous of
effecting a union with the ancient colony of Newfoundland, believing it would be in
Imperial as well as Canadian interests; but, considering the financial obligations
of Newfoundland and our relations to the other Provinces of the Dominion, it is
necessary, in order to accomplish this end, that the Imperial Government should
extend the most generous assistance possible.
Believe me, etc.
(Signed) MACKENZIE BOWELL.
Memorandum.
CANADA AND NEWFOUNDLAND AS TO DEBT.
Newfoundland has a debt of .................... $11,247,534
In addition to which she is under
obligation to the Newfoundland
Railway Company for an annual
subsidy of $45,000 for 22 years,
which, capitalized at 4 per cent.,
amounts to ........................................... 650,300
Amount required to complete the
Railway across the Island and
the Brigus branch, both of which
are under contract ............................... 3,932,000
Total indebtedness and obligations ..... $15,829,834
The highest indebtedness Canada
has assumed for any Province,
and is willing to assume for
Newfoundland, is $50 per head
of her population, which, on the
estimate of 207,000, amounts to .......... $10,350,000
Leaving a balance and liability of ........... $5,479,834
Canada cannot assume more than
the above amount of $10,350,000, as this is the highest indebtedness assumed for
any Province. To exceed this amount would open up at once the question of terms to
each member of the Confederation. Newfoundland, however, represents that it is
impossible to provide for this excess of $5,479,834 and carry on its local services
at the same time, with the resources that would be at her disposal under
Confederation.
AS TO YEARLY REVENUE.
After the Dominion has assumed
the general services which would fall to her under Confederation, the Island has to
provide for its local services, for which it now expends about $700,000. After
economising as far as possible, she considers a revenue of $650,000 annually the
minimum upon which she could manage her affairs. Canada proposes to allow
Newfoundland:--
For legislation ............................................ $50,000
For her present population (207,000),
at 80¢ per head ........................................ 165,600
For Crown Lands ........................................ 150,000
Other allowances ....................................... 100,000
$465,600
The following will show how the
debt and yearly allowances to Newfoundland compare with those given to the other
smaller Provinces of the Dominion:--
Province. | Population. | Dominion
subsidy. ($) | Debt Assumed
per head. ($) |
Nova Scotia | 450,396 | 432,814 | 29.75 |
New Brunswick | 321,263 | 483,596 | 30.30 |
Manitoba | 190,000 | 437,601 | 32.43 |
Prince Edward Island | 109,078 | 183,084 | 50.00 |
Newfoundland | 207,000 | 465,000 | 50.00 |
To grant the larger allowance
asked by Newfoundland would be impossible, as it would be so much larger and out of
all proportion to the subsidy granted to the other Provinces that it would either
be rejected by the Canadian Parliament or open up for discussion the question of
allowance, and lead to an increase to the other Provinces of Confederation which
the revenue of the Dominion would not justify.
THE POSITION OF CANADA
Newfoundland under her present
tariff, on imports of about $7,000,000 of dutiable goods, collects about $1,600,000
or revenue.
Canada, it is estimated, would
receive under Confederation about $800,000 in revenue--the loss being due to the
diversion of trade from foreign countries to Canada. Canada's yearly account under
Confederation would then stand:--
Payment to Newfoundland of a yearly subsidy of ........ $465,000
Interest on $10,350,000 of debt ................................... 392,000
Cost of general services
assumed by Canada for Newfoundland :--
Salary of Lieutenant-Governor;
Customs;
Excise;
Savings Bank;
Public Works (of Dominion character);
Crown Lands;
Administration of Justice;
Post Offices;
Militia;
Steamship services;
Marine and Lighthouses;
Fisheries;
Penitentiaries;
Weights and Measures and Gas Inspections;
Experimental Agriculture and Statistics;
Quarantine;
Immigration;
Insurance Inspection;
Geological Survey.
Total ....................................................................... 600,000
$1,457,000
Less anticipated receipts from Customs
and Excise ............................................................. 800,000
Leaving a financial loss of ...................................... $657,000
If provision could be made for
the indebtedness of Newfoundland over and above what the Dominion assumes,
Newfoundland could possibly accommodate herself to the situation. She would,
however, have to economise; to throw some of the burdens which the Government now
carries upon the shoulders of the community, and to raise by some form of taxation
a portion of what would be necessary.
To-day the Newfoundland
Government practically assumes the whole burden of the poor relief, educating the
people, building the roads and bridges, and performs other services which, in the
Provinces of Canada, are dealt with almost exclusively by the Municipalities, and
in no case by the Federal Government.
The Newfoundland Estimates for
the year 1894 show the requirements for these services to be:--
Poor Relief .................................................................. $209,611
Education ................................................................... 157,851
Roads and Bridges ...................................................... 129,300
Total ......................................................................... $496,762
* Extract from Appendix to Journal of House of Assembly of Newfoundland, 1894-95.
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