IN

CHAPTER XIV

THE PACIFIC RAILWAY

N 1871 British Columbia was admitted into the Confederation. The chief feature of the contract was that which stipulated for the commencement within two, and the completion within ten years from the date of union, of a railway connecting the Pacific Ocean, through British territory, with the railway systems of Ontario and Quebec. The leaders of the Liberal party, while favourable to the admission of British Columbia, and by no means hostile to the construction of a transcontinental road across British territory, thought that to build the railway within the time specified would press too heavily upon the resources of the Dominion; and argued that it was enough to proceed with the surveys in the meantime, and subsequently with the work of construction, as the state of the finances would justify. These views, however, were rejected by Parliament, and the country was committed to the more heroic policy of the Conservative leaders.

Towards the close of the session of 1871, on the motion of Sir George Cartier, a resolution was adopted to give effect to the ministerial policy. This provided that the road should be built and

operated by private enterprise, and not by the Government, and that such aid should be granted in lands and money as would not unduly press on the resources of the country, and as Parliament should thereafter determine. During the session of 1872 the Canadian Pacific Company, with Sir Hugh Allan at its head, and the Inter-Oceanic Company, organized by Sir David Macpherson, each proposing to undertake the construction of the railway, were granted charters by Parliament; and at the same time the Government took authority to negotiate for the amalgamation of the two companies, or to issue a royal charter to a new company. It was found impossible to effect an amalgamation, and the Government, therefore, formed under royal charter a company for the construction of the road, of which Sir Hugh Allan was president, and in which the several provinces of the Dominion were represented. The railway was a dominant issue in the general election of 1872. For the time the Government was sustained, but the discovery of Sir Hugh Allan's very heavy contributions to the Conservative campaign fund led to its early downfall. It was stated, however, in the Speech from the Throne, at the opening of the session during which the defeat of the Ministry was accomplished, that "The Canadian Pacific Railway Company, to whom a royal charter was granted, have been unable to make the financial arrangements necessary for the construction of that undertaking,

and have therefore executed a surrender of their charter which has been accepted."

Mr. Mackenzie, who succeeded to the office of Premier on the resignation of Sir John Macdonald, in his address to the electors of Lambton, outlined the railway policy of his Government. He intimated that he would seek such a modification of the terms made with British Columbia as would " "give time for the completion of the surveys, the acquisition of the information necessary to an intelligent apprehension of the work, and its prosecution with such speed and under such arrangements as the resources of the country will permit, without too largely increasing the burden of taxation on the people." In the meantime he would "utilize the enormous stretches of water communication which lie between a point not far from the Rocky Mountains and Fort Garry, and between Lake Superior and French River on the Georgian Bay, thus avoiding for the present the construction of about 1,300 miles of railway, estimated to cost from sixty to eighty millions of dollars, and rendering the resources of the country available for the prosecution of those links of the Pacific Railway which are necessary in order to form a complete line of rail and water communication from East to West." This, he pointed out,' would involve the construction of a short line of railway from the

1 See Mr. Mackenzie's "Address to the Electors of Lambton," January, 1874.

mouth of the French River on Georgian Bay to the south-east shore of Lake Nipissing, and a grant in aid of extension to that point of the existing and projected lines in Quebec and Ontario. He also pledged his Administration to the early construction of a branch line of railway from Fort Garry to Pembina.1

In 1874 the Government obtained authority from Parliament to construct the railway as a public work, if it should so decide, and to divide the road into four sections, the first from Lake Nipissing to the west end of Lake Superior, the second from Lake Superior to Red River, the third from Red River to the foot of the Rocky Mountains, and the fourth from the foot of the Rockies to the Pacific coast; or to arrange with contractors for the construction of the work on the basis of a subsidy per mile of $10,000 in money and 20,000 acres of land, with four per cent. interest for twenty-five years on a sum to be stated in the contract. It was provided that the land should be of fair average quality, and in alternate sections, and the Government reserved the right to sell two-thirds of the

1 "No Government that could be formed will carry on the work of construction more efficiently and speedily than will that of Mr. Mackenzie. It was the Reform party that first advocated the annexation of the North-West Territory, including British Columbia. It is among Reformers that are found the most enthusiastic supporters of the Pacific Railway. And it is by a Reform Government that the work must be carried to final completion. It is not the people of British Columbia, therefore, that have cause to regret the advent of Reformers to power." -Toronto Globe, February 13th, 1874.

land grant at prices to be arranged with the contractors, to whom the proceeds of sales should be paid half-yearly. It was also provided, in case this plan of construction were adopted, that the contractors should own and operate the road, under regulations in respect of freight and passenger charges and the frequency of service; but that the Government should have the power to buy out the whole or any part of the road at a sum not exceeding ten per cent. above the actual cost, and subject to a deduction equal to the value of the land and money subsidies. It was, however, found impossible to induce capitalists to undertake the construction of the road on the terms proposed; and Mr. Mackenzie, under that clause of the Act which empowered the Government to construct the railway as a public work, placed under contract 114 miles from Selkirk eastward to Rat Portage, and 113 miles from Fort William westward to English River. The construction of the Pembina branch, from the international boundary to St. Boniface, was completed in the autumn of 1878, and railway communication with Winnipeg thus established. A telegraph line from Red River to Edmonton, covering 807 miles of country, was also erected during 1874 and 1875; and early in 1875 a contract was entered into for the erection of a telegraph line from Red River to the Lake Superior terminus of the projected railway.

In British Columbia progress with the great