Bill Waiser

The Regina taxman cometh

One of the driving forces behind the late 19th century demand for western provincehood was money – or, to be more precise, the lack of money.

Throughout the 1880s, the elected members of the North-West Territories council constantly complained about the small government budget. Some even argued that Ottawa was more interested in exploiting the region for its own benefit – treating it as little more than a colony.

The creation of an elected legislative assembly in 1888 did nothing to ease this grievance. The lieutenant-governor for the N.W.T. continued to exercise wide discretionary powers, particularly over spending, while Parliament never voted sufficient funds for territorial needs.

The solution, for many westerners, was greater independence in the running of territorial affairs, culminating in provincial status. But when self-government was finally achieved in October 1897, the first (and only) territorial premier, Frederick Haultain, found that having control over government spending did not mean much if the territorial legislature did not have much to spend. Any revenue from North-West lands and resources still went to the federal treasury.

The chronic funding shortfall became more acute with the immigration and settlement boom of the late 1890s. The great agricultural promise of the region was finally being realized and the territorial government simply did not have enough money to meet the growing service and infrastructure demands. “We are confronted with impossible conditions,” Premier Haultain admonished the federal minister of the Interior.

In desperation, the Haultain government decided to cash in on the Klondike gold rush and the tens of thousands of stampeders making their way north over the winter of 1897-98. Since the Yukon came under the immediate jurisdiction of the territorial government in Regina, there was a potential windfall to be made in taxes and licences.

G.H.V. Bulyea, the assembly member for Qu’Appelle South, was consequently named Yukon commissioner in January 1898 and sent north to Dawson City to see that the territorial government’s jurisdiction and responsibilities there were respected and enforced. But Ottawa had already named a commissioner to handle federal government interests in the region – ironically, James Morrow Walsh, a former NWMP officer who was probably most famous for his dealings with Lakota Sioux Chief Sitting Bull. Nor did the federal government want Regina siphoning off Yukon revenue.

Bulyea’s arrival precipitated a heated showdown with Walsh, who refused to recognize the territorial government’s authority in the Yukon. At one point on 21 May 1898, the two commissioners engaged in an acrimonious shouting match on the streets of Dawson City.

Bulyea appealed to the courts to uphold his appointment. But before a ruling was rendered, the Canadian government passed the Yukon Act in June 1898 and thereby made the Yukon a separate territory beyond the reach of Regina. Bulyea, however, was allowed to retain the nearly $25,000 he had already collected, mostly from the regulation of the sale of liquor.

The Haultain ministry “viewed with apprehension” the federal decision to “cut off ” part of the North-West Territories. Not only did the creation of a separate Yukon territory confirm that Ottawa – and Ottawa alone – controlled and dominated the territories, but it suggested that the federal government would have its way if and when it came to the creation of future provinces.

That is exactly what happened in 1905. The Canadian government ignored Premier Haultain’s proposal for one large western province between Manitoba and British Columbia (to be called Buffalo) and created two roughly equal provinces, Saskatchewan and Alberta, in the southern portion of the territories. Even then, the two new provinces were not to become full partners in Confederation. They, along with neighbouring Manitoba, were treated differently – unequally.

Under the terms of the 1867 British North America Act, provinces exercised control over the public lands and resources within their boundaries. But that right was denied Manitoba in 1870, and it was denied Saskatchewan and Alberta 35 years later on the grounds that federal retention of western lands was needed to promote immigration and settlement.

Ottawa attempted to make up for the loss of revenue by awarding the new provinces generous subsidies based on population. Haultain, however, wanted no part of the compensation package and demanded the same right as other provinces in Canada.

That right would not be realized until 1930.

This article originally appeared in the Saskatoon StarPhoenix.

Photo: Territorial Government Offices in Regina.

Photo credit: Saskatchewan Archives Board.

Questions or comments? Email Bill Waiser at bill.waiser@usask.ca

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