In these three paragraphs of the Quebec resolutions we see clearly expressed the leading principles on which the Canadian federation rests—­a federation, with a central government having jurisdiction over matters of common interest to the whole country comprised in the union, and a number of provincial governments having the control and management of certain local matters naturally and conveniently belonging to them, each government being administered in accordance with the well-understood principles of the British system of parliamentary institutions.

The resolutions also defined in express terms the respective powers of the central and provincial governments.  Any subject that did not fall within the enumerated powers of the provincial legislatures was placed under the control of the general parliament.  The convention recognised the necessity of preventing, as far as possible, the difficulties that had arisen in the working of the constitution of the United States, where the residuary power of legislation is given to the people of the respective states and not to the federal government.  In a subsequent chapter I give a brief summary of these and other details of the system of government, generally laid down in the Quebec resolutions and practically embodied in an imperial statute three years later.

Although we have no official report of the discussions of the Quebec convention, we know on good authority that the question of providing revenues for the provinces was one that gave the delegates the greatest difficulty.  In all the provinces the sources of revenue were chiefly customs and excise-duties which had to be set apart for the general government of the federation.  Some of the delegates from Ontario, where there had existed for many years an admirable system of municipal government, which provided funds for education and local improvements, recognised the advantages of direct taxation; but the representatives of the other provinces would not consent to such a system, especially in the case of Nova Scotia, New Brunswick, and Prince Edward Island, where there were no municipal institutions, and the people depended almost exclusively on the annual votes of the legislature for the means to meet their local necessities.  All of the delegates, in fact, felt that to force the maritime provinces to resort to direct taxes as the only method of carrying on their government, would be probably fatal to the success of the scheme, and it was finally decided that the central government should grant annual subsidies, based on population, relative debts, financial position, and such other facts as should be fairly brought into the consideration of the case.