(Relentless change pp. 1-14)
Laying the foundations, 1805-1905
- Mid 19 century (1850’s) British north America was made up of; United province of Canada (modern
day Quebec and Ontario) Nova scotia New Brunswick PEI Newfoundland Vancouver island
- The interior contained 3 territories; 1) Rupert’s land (much of the north, all the area around the Hudson
Bay). 2) North west territories. 3) New Caledonia
- The British north America act;
• The act, also known as the BNAAct, comprises a major part of the Constitution of Canada. The
Act entails the original creation of a federal dominion and sets the framework for much of the
operation of the Government of Canada, including its Federal structure, the House of Commons,
the Senate, the justice system, and the taxation system. Ruperts land was then added to the
dominion of Canada in 1869 after it was acquired from the HBC.
- Two major public policy statements were particularly significant in the government playing an important
role in the business and economic developments;
• BNA act (British North America act); 1867. Other than creating the dominion of Canada, the
act also allocated responsibilities between the federal and the provincial authorities. The federal
took responsibility of things like regulation of commerce, currency and banking.
• National policy; 1878. The National Policy was a Canadian economic program introduced
by John A. Macdonald's Conservative Party in 1876 and put into action in 1879. It called for
high tariffs on imported manufactured items to protect the manufacturing industry. Macdonald
campaigned on the policy in the 1878 election, and defeated the Liberal Party, which
supported free trade. Three main parts; 1) The settlement of the west 2) The building of a
transcontinental railway 3) The adoption of protective tariff. This was influenced by the heavy
reliance on trade.
- Through the BNA act, the federal government was given powers over currency, banking as well as life
insurance. This played an important role in the development of Canada’s financial system.
- The passage of the Bank act in 1871 ensured a sound currency and a nationally regulated banking
- One of the requirements of the Bank Act was that it is renewed decennially ( every 10 yrs) to ensure
that legislators will periodically update the Act in order to keep pace with developments in the financial
- In the early years of the confederation, most major financial institutions were banks. But also, important
life insurance companies as well as mortgage, loan and trust companies had emerged. In the early 20 th
century, there were 37 banks in Canada, with HQ mainly around the Toronto and Montreal area.
Other financial intermediaries
- Although banks started off to be the dominant financial intermediaries, mortgage loan companies, life
insurance companies and other financial institutions soon took over. The government responded
by supporting this growth and even appointing superintendents to oversee some of those
-Among the earliest entrepreneurs were the French fur traders. They helped out the HBC. After that,
some traders fro Montreal started developing trade and competing with HBC. The financial systems that
were in place made it simpler to obtain capital which helped increase the number of entrepreneurs.
Large non financial corporations