The branches of the banks act as depositaries of the Dominion and provincial governments, and transfer funds received at their various branches to Ottawa or to the several provincial capitals. All customs, internal revenue and Post Office receipts, including the deposits of the Postal Savings Bank, are deposited by the federal officers in the local branches of the various banks thruout Canada, and are transmitted by them to Ottawa for the credit of the government. Government checks of every description, including those issued on account of withdrawals from the Postal Savings Bank, are, by the Bank Act, payable without charge at any branch of any bank in Canada.
Altho the collection and disbursement of the national revenues involve a great deal of work, it is done willingly by the banks, not only in a way, as a return for the note issue privilege, but also as an appreciation of the practical and economical manner in which the government handles its revenues and funds. So efficiently is this done thru the banks that no disturbance is ever made in business or financial circles by the movement of government moneys, notwithstanding their very large aggregate. All revenues received are left with the banks for commercial use until ultimately disbursed by the government. There is no wasteful piling up of gold in government vaults; every cent is allowed to do its share in the economic development of the country until wanted.
The net balance due to the government may be mobile, and at times comparatively small, but the principle is sound and works well in every respect. It would be almost impossible to devise a scheme for the collection and disbursement of government revenues that would work more smoothly or efficiently.
Canada in her scientific administration of government funds differs from almost every other country.
The balances of the provincial governments consist principally of deposits in connection with the Inland Revenue Department and judiciary accounts. The balances due the Dominion and provincial governments are privileged claims on the assets of a bank and rank above those of other depositors.