on new bond issues increased to per cent. Although legally, the bond money should only have been dispensed in proportion to the work completed, the release of funds was far in excess. In February 1914, the government raised the bond issue limit from $35,000 to $42,000 per mile. The announcement of an extension into the Peace Country was intended to soften the news of huge cost over-runs to date. Welch underwent a major operation and took medical leave November 1913–November 1915, while Stewart shouldered the daily responsibilities. Rather than reducing or suspending operations, which could have preserved almost 70 per cent of the bond money, the government continued releasing funds. When the bond money was exhausted in November 1915, the line was only 35 per cent complete, the PGE was insolvent, and as guarantor of principal and interest on the bonds, the BC Government faced a debt burden. Squamish and Clinton became the terminals of the line. Stewart left for overseas service in August 1916. During World War I, he was promoted to brigadier general in order to direct railway construction in France. His skills in the rapid construction of track elevated him to command all British and Canadian rail units. Later audits and enquiries revealed that the PGE Act, which usurped the basic checks and balances of the Railway Act, was itself laxly followed by the government, resulting in an overpayment of more than $5.7 million to FW&S. In late 1917, limited grading having ceased, FW&S proposed a government takeover of the PGE. To avoid lengthy and expensive legal proceedings, FW&S agreed in February 1918 to hand over PGE assets and a cash payment of $750,000. Although released from all obligations and the dropping of government litigation, FW&S was allowed to retain ownership of the PGE Land Development Company. The degree to which financial assets had been transferred to this company since 1912 was never revealed. Although Welch had promised at the hearings to provide information on land sale profits, he instead relocated to Seattle with the corporate records. The PGE insolvency had forced the BC government to assume the ownership and debt of the railway. As second premier of the following Liberal administration, John Oliver engaged NorCon to extend the line northward to Quesnel. A subsequent royal commission found many similar abuses by Norcon to those of FW&S. When Norcon took away equipment estimated at up to $1