ith other expenses of the
service, and the justice of a lower rate for such letters as obtained no
benefit from that expenditure naturally suggested itself. The lowest
rate fixed by the Act of 1765 for transmission within Canada of a single
letter was 4d., and, rather than charge such a rate on local letters,
the deputies in Nova Scotia allowed such letters to be deposited in the
post office free.

At Confederation a special rate for local letters of 1 cent per 1/2
ounce was established. At this time there was still no authorized
house-to-house delivery of letters in any part of Canada, and local
letters were actually what they are always termed, viz. "drop" letters.
They were letters dropped into the post office letter-box and handed out
at the office to the addressee on application. When in 1875 delivery by
letter-carrier was introduced in certain towns, the drop-letter rate was
not disturbed. It was thought, however, that a postage charge of 1 cent
was not sufficient to cover the cost of the service of delivery at the
place of address, performed by an expensive establishment of
letter-carriers; and in 1889, on that ground, though much against the
wishes of the mercantile community, the rate was raised to 2 cents an
ounce in cities and towns where the system of delivery by letter-carrier
was established, the existing rate of 1 cent per 1/2 ounce being
continued in other cities and towns.

The ordinary letter rate was still 3 cents. This change therefore left
all local letters with a lower rate than ordinary letters.[551]

The 2-cent rate proved to be too high. Much dissatisfaction resulted,
and evasions were constant. In defiance of the law, which conferred on
the Postmaster-General the monopoly of the carriage of letters,
merchants made arrangements for the transmission and delivery by their
private messengers of their letters for local delivery. The evil assumed
such proportions that the suppression of the private carriage of local
letters was deemed out of question, and the Government concluded that
the only satisfactory solution of the difficulty was the re-introduction
of the general 1 cent drop-letter rate.[552] So great was the number of
drop letters sent otherwise than through the Post Office that no actual
loss of revenue was anticipated from a reduction of the rate, which
should bring back those letters to the post. This anticipation was more
than realized. In a very short time after the passing of the Act