as chairman, brought up the first report of the Committee on Standing Rules and Orders, as follows—

Report considered and adopted.

announced that he had to-day received a letter from Mr. B. J. Pienaar, Dr. de Jager and Mr. Sampson directing Mr. Speaker’s attention to a general desire among members that, in view of the current session being divided into two periods, the railway concessions for members’ families should be granted in respect of the second part of the session as well as the first part.

I move, as an unopposed motion—

seconded.

Agreed to.

When this Bill was before the House at the end of last week the Minister showed a considerable amount of impatience with the speakers on this side who rose to oppose the second reading, but I would like to remind him that he has not placed before the Assembly any new fact in connection with this if after. No new argument has been addressed to us to show that the Bill is any more acceptable to its opponents now than it was a year ago or four months ago, and if he deems it his duty to press on with this Bill and pass it into law, we, on this side, deem it our duty to continue to oppose the Bill. In doing so we do not oppose the establishment of an iron and steel industry in Pretoria. We are quite willing to see that industry established so long as it is done in terms of the existing law, that is, if the Pretoria proposition is equally attractive to investors and industrialists who wish to take advantage of the Bounties Act, the field is open to them and they may do exactly what has been done in Vereeniging and Newcastle, namely, establish an industry and take the chance of succeeding in opposition to the existing undertaking. It has been represented by speakers on the other side, I think by the hon. member for Pretoria (Central) (Mr. te Water) that we are opposed to Pretoria in some way, and that we are also opposed to the establishment of this industry. It has been amply demonstrated from this side of the House that that is not the attitude we take up at all. We agree with the Minister that the iron and steel industry is a key industry and that it is a desirable thing for South Africa, but we do not agree with him that this industry which is to be established in Pretoria should become a State industry, should be controlled by the State, and financed by the State, and that the State if necessary should undertake the entire responsibility in connection with the matter. I would remind the House that the former Government was so anxious to see an iron and steel industry established that they induced Parliament to pass the Bounties Act of 1922; and the right hon. member for Standerton (Gen. Smuts) was mainly instrumental in getting the German experts who came here some years ago to visit this country and report upon the establishment of an iron and steel industry. So that it is quite wrong and quite misleading to say—and the public are being misled when they are told, as they often are, by speakers on the other side—that the S.A. party is opposed to the establishment of an iron and steel industry. I think the Minister of Agriculture told an audience the other day that that was the attitude this party took up. Nothing of the sort. But we say that this industry has already been established and it is not necessary for the State to take it under its wing in the way it is sought to do under this Bill in order to make the industry a success. We know that at Newcastle pig iron is being turned out, and that it is being sent to Vereeniging where it is manufactured into steel goods in a variety of forms. If it had been desirable to speed up the industry already established I think the Government might far better have brought forward a Bill to increase the present bounties. They should give further State assistance in that way, rather than promote this Bill for the purpose of making a new departure. It is a remarkable thing that these German experts reported to their principals that in, their opinion this industry would pay a dividend of 14 or 14½ per cent., but notwithstanding that very glowing and attractive picture, their principals in Germany turned the proposition down. It is very seldom that industrialists have had an opportunity of making 14½ per cent. I think that most of them would be quite willing to have a certainty of making a much more moderate dividend. It makes one wonder whether the Government have really a complete belief in the undertaking and the conclusions arrived at by the experts when they see people in other lands with money who are not disposed to take up this proposition.

Your own leader has accepted the German report.

That is all right. The Minister has accepted the report, but the principals of these experts were not prepared to back the report with their money, which after all is the best proof of the soundness of our argument.

Why did your own leader accept it?

There is no doubt that one more serious objection to the Bill is the attempt to nationalise this industry. A Government undertaking must necessarily be surrounded and hedged in by rules and regulations which are not applicable to a competitive industry. What is wanted in industries of that sort are initiative and adaptation to changing circumstances—a continual search for improved methods of production, and finding markets. Is any Government as well able to do such things and are Government officials likely to be so well equipped as private persons to carry on work of this sort? They know the Government stroke is a low one, and there is less probability of success being made than if the matter were in private hands. One thing that struck one when the Minister moved the Bill last session was the unsympathetic and callous way in which he referred to the probability that the undertaking, foreshadowed in the Bill, would crush out the existing industry. We have in the Union Steel Corporation a company that has spent a considerable amount of money—three-quarters of a million to one and a quarter million I have heard stated—in experiments in connection with the production of pig iron and steel goods. They have had failure after failure and lost money, and how are making a success of the business. Just when the industry has been established the Government comes along with these proposals, which if successful, will blot out the existing undertaking. That is grossly unfair to the people who are engaged in the business and to their shareholders, and will do anything but encourage other people to put money into similar industries. Another undesirable feature about this system is that this industry is to be subject to political control. We know that every State industry must necessarily be controlled by a Minister, who is a political officer; but there are grave objections to an industry like this or any industry or department being controlled for political purposes in the interests of any political party, and that is the danger we foresee in connection with this matter. We have had experience already with the friends of Ministers and their supporters being preferred for public appointments, and we may expect a similar state to continue in connection with this industry if it is established. One can quite well imagine the Minister writing to one of his supporters asking “dear George” to recommend the appointment of someone as a cashier at £1,500 a year and stating that a knowledge of bookkeeping is unnecessary so long as he is a good party man. I do not think that the case for Government control has been made out. The Minister told us that the railways have been a success. I do not know whether our railways would not have been better managed under private control; at any rate I am quite sure that a large number of men who are employed on the railways would not be there if a private company were running them on business principles, with the intention of making a dividend for their shareholders. Once a man is in a business of this sort he is in very much the same position as a man who holds a position in a Government department. Once he is there he is there for life, and it is difficult to get rid of him so long as he keeps within the lines and he does not bring himself into the category of a man who has committed an offence under the disciplinary rules of the service. A friend of mine bought a business in South Africa which had not been paying for a number of years, and he meant to make it pay. He said to the manager—

At the end of the year the business was still making a loss and the manager had to go. My friend appointed three managers in succession, all of whom failed to make the business pay, but the fourth person he appointed in that capacity made the thing a success. It is impossible, however, for a Government to make these changes in the same way that a private business man can do. In a highly competitive undertaking like this, Government methods and the circumstances which will undoubtedly exist under Government control will all work against the enterprise becoming successful. I take exception to some of the statements which have been made to bolster up these proposals. It has been said from the Government side that the Newcastle works are a dismal failure. These works, however, have turned out pig iron as good as you can get in any part of the world. So far as the quality of the ore is concerned the product is quite first class. Again, we were told that it was quite impossible to produce pig iron for less than £5 a ton at Newcastle, but we have it from the company itself that the cost of production to-day is only £3 18s. a ton. Then, statements were made as to the ore deposit at Newcastle being insufficient and likely to last only three or four years. Well, I accompanied the hon. member for Newcastle (Mr. Nel) to the spot and as far as I could judge there was a mountain of ore which one would imagine was practically inexhaustible. A friend of mine, who is an engineer, says the deposit is more likely to last fifty years than five years. Another point is that the Bill contains a clause which is grossly unfair to the existing company—that clause binds the Railway Administration to enter into a contract with the new company to supply all the wants of the railway department. If this company has such glowing prospects why should it be necessary to bind the Railway Administration to purchase all its requirements from it. Surely the existing company ought to have a chance of supplying the Railway Administration, which is the largest purchaser of steel and iron goods in the Union. It is rather strange that the Chambers of Commerce have unanimously condemned this scheme. The Minister does not, of course, care a snap of the finger for the chambers of commerce, because he has told us they are interested in importing goods. But what does he say to the resolution passed by his friends, the industrialists, at their conference at Durban when they condemned, in round terms, the Government’s intention to establish a State industry? These industrialists are sympathetic to the Government. They have their products protected up to the hilt by the Government, but they can see no good in this undertaking or any chance of its paying its way. The fact remains that the Government is embarking on a very dangerous experiment, and we do not know how much it is going to cost the country. The Government undertook, at the beginning, to subscribe for only 500,000 £1 shares and to guarantee a debenture issue of £1,500,000, but if the public do not subscribe for the remaining three millions the Government will do so. So we shall have the Government committed to a liability that may run into £5,000,000 in connection with an undertaking which the experts say will pay 14 per cent. But that estimate the employers of these experts apparently doubt very much. Once an industry of this description is established it will be almost impossible for any Government to close it down. If you have 5,000 men, or even only 500 men, employed in this industry at Pretoria the Government will not be able to resist the political pressure brought to bear upon it to continue pouring out public moneys for years to support an industry in the hope that some day it will pay its way. A private company with limited resources which embarks on a non-paying enterprise sooner or later comes to the end of its tether, but the Government, with the taxpayers’ money behind it, is able to go on and spend millions of pounds in bolstering up an industry which, if it were managed by private individuals, might pay its way. Similar industries have been built up in England by private enterprise. America also depends on private enterprise for its great success as an industrial country. Almost every country which has started State industries has run them at a loss and is gradually abandoning them. I think a good deal of the information on this subject which is in possession of the Government has proved to be misleading. One statement made at the second reading was certainly very far from the truth as applied to present conditions. We were told that pig iron could be sold at Johannesburg at £14 a ton.

Was that said at the second reading by anyone on these benches?

That is my recollection, but if the Minister tells me it was not so I will withdraw it.

The £14 was the price mentioned at the date of the German report, but I alluded to it last session as being a considerable error and discrepancy.

I understand £14 a ton was mentioned in the report. The Minister says he corrected that, but I did not know he had done so. In any case, a good case can be made out for reviewing the whole position afresh, because circumstances have changed materially since the report was drawn up. If the Minister would send this Bill to a select committee and allow the committee to get information from any person able to give information likely to help the committee, we should probably arrive at a truer position than we can at the present time.

I am sorry I was not present at the earlier stages to hear what was said, and I hope, therefore, I shall not weary the House by repeating arguments already used. I am not opposed to the establishment of the industry in South Africa. I have shown by my actions that I am in favour of it. Neither our party nor the Nationalist party were opposed to this industry. The whole history of the bounty system has shown that both sides were keen to see this key industry established in South Africa. We felt that if the bounty system was not sufficient we would be in favour of further assistance and that even a guarantee might be given by the Government. I believe there is only room for one such industry in South Africa, if it is to be run successfully. I might be asked why I object to the Bill. It is because it is pure State enterprise. I believe in an industry of this kind, so essential for the country, it is right to give State aid to private enterprise, but I cannot see State enterprise being privately aided. I think the Minister either in his second reading speech, or when he introduced the Bill, referred to the distinction between Government control and Government management, and whilst he admitted there was Government control, he said it was clear there would be private management, which would have a free hand to run the industry in the best possible manner. On the question of whether it is State enterprise or State management, or private management under the Minister, there can be no doubt. The Minister will remember, under Section 3, there is provision for the appointment of seven directors. Of the seven directors, four are to be Government directors. The Governor-General has the right to appoint the chairman, and the Government has the right also to appoint the managing director.

Where does it say that?

In the Bill, if you will only read it. They will appoint the chairman and the managing director for the concern. I put it to the Minister, if you have the chairman and the managing director, and the share voting control, surely that is State management. If you have the power to appoint the managing director, and you have control on a vote, surely then you have the management of the concern. Private shareholders can appoint three directors, and they only have the power to appoint the deputy-chairman. Under the Bill that deputy-chairman shall, on no account, act unless the Minister is satisfied that he shall do so. Under Section 5 (4) the Minister has the right, if the chairman and the managing director for any reason cannot act, to appoint somebody else to act, even if it is only temporarily for one board meeting. That is to prevent the deputy-chairman from ever really acting. The position goes further, because under the Bill, while the directors appointed by the Governor-General can be appointed for five years, they can be re-elected on the expiration of their term of office, but not so in the case of the directors appointed by the private shareholders. They can appoint three directors, and when their time expires, it is laid down in the Bill that they are not eligible for re-election, so that it is not possible for a director appointed by the private shareholders to make himself familiar with the concern, or, if he is familiar, to remain in office for longer than a year and make himself useful.

That has been slipped into the Bill.

Certainly this position was never mentioned in select committee, it was never mentioned in this House, and it was never mentioned in the report stage. It somehow crept in in the third reading. It is not reasonable, when a man has been appointed by the shareholders and has gained a knowledge of what the position is, he is not allowed to be re-elected. In Clause 4 (2) it says he shall not be eligible for re-appointment. I hope the Minister can explain how that provision appeared. It is to be State management pure and simple.

The printers’ devil pushed it in last year.

You cannot blame the printer. I may say further that my objection to the Bill is because I object to State enterprise and State management, and this Bill, as I hope to show, is pure State management. Surely in an industry of this kind the very best private skill and the very best private knowledge should be secured so that if it can possibly be made a success that should be done. Then I object to State management and enterprise because it kills private enterprise. I can understand the Minister of Mines saying that this is an important industry and that he would like to see it established in South Africa. My method would be quite different. I would say that the State is willing to assist this enterprise and the railways and mines are big consumers and I would call a conference and say to these people—

The Government have adopted a policy of keeping the people who could start an enterprise of that kind at arm’s length.

The point that you elaborated so long is a printers’ error.

I am sorry if I wasted the time of the House.

It is a most amazing printers’ error.

On the second reading I objected to the Bill in its present form because neither the capital requirements nor the earning capacity of this industry have been sufficiently explained to the House and to the select committee which sat on the Bill. It is most important that you should not rush into an enterprise which may be a failure and entail a heavy burden on the country. In the select committee a table was presented to us by Mr. van Niekerk, but we had this position that a figure as to capital expenditure was put before us arid we were also told that you may have a cable by which the capital expenditure would be increased. Therefore, I say we did not have enough information before us that the money which was being put up was sufficient to bring the enterprise to a producing stage. Then in regard to the working capital we were told that economy could be effected by the use of manganese. Manganese has been used for many purposes. I do not say for one moment the capital is insufficient. I have got no means of judging. No evidence was brought before us actually to show that the work could be carried on with the money mentioned in the statements placed before us. Take the earning capacity, I do not dispute the figure given, but it was clear that no allowance had been made for depreciation and no allowance for redemption of debentures. It may be that the concern could earn more money than was stated in the estimates given, but on the figures given, I hold that it has not been proved that this is a highly paying enterprise or that it is an enterprise of such a nature that the Government would run no risk in putting money into it. There are other points which certainly should be cleared up. Take, for instance, the debentures. It is provided in the Bill that debentures are to carry 5½ per cent. interest, but nothing is said as to the issue price of those debentures. If the interest price is fixed it surely should be laid down that these debentures should be issued at par. Nowhere is it said that the debentures shall be issued at par. I may mention another item which is not provided for. You cannot raise £4,500,000 without some underwriting charge, without going to somebody to underwrite it. These people charge for their services. That item is not mentioned at all. How are you going to provide for it? We ought to know how much is to be paid by the Government for underwriting. Here you have got an enterprise, the capital expenditure of which has not been sufficiently demonstrated. Then the earning capacity of the enterprise is doubtful. You say in the first instance that you are creating debentures which will be a first charge on the enterprise. Then you are to raise preference shares, and after that, to try and raise ordinary shares. Surely after all these charges have been provided for no one will take up the ordinary shares. But the Government say that they are so keen to have this enterprise that if the public will not provide the money, they, as a Government, will provide it. But where is the provision in the Bill? The Bill does not enable the Government to take up all the shares. I say that the financial clauses of this Bill should be changed. We tried to change them last session, and I moved an amendment, realizing the difficulties of raising this money, which did not take anything away from the Government. The amendment was to this effect, that the Government would guarantee £1,500,000 as capital, would guarantee £87,500 as interest and it would be left to the public to use that money in any way they liked. The ordinary shares, with all the prior charges, no one will take up, but even the preference shares will not be taken up unless the underwriter is satisfied that the money will be forthcoming to complete the works. It would have been a thousand times better if negotiations had been carried on through a financial institution, and if a Bill had been agreed upon. The Government have given themselves no power at all to negotiate with anyone. The result will be that the Government will be landed with all the ordinary shares, and I say it is a very bad thing that it should be so. I would like to make one more point, and it is another reason why I object to this Bill, and that is the monopoly in Section 15. After all it should be enough for this Pretoria industry to get 50 per cent. If they are capable of competing they will get the 100 per cent. all the same.

What is the use of your telling us that you are anxious to establish an industry when the contention is that it is established?

I do not suggest that Newcastle is a very big enterprise. I do not even say it ever will be, but I do know this, that the enterprise has been established and the provision that the railways must take 100 per cent. of their requirements must needlessly handicap Newcastle or any other enterprise. It has not been demonstrated that the money provided is ample. As it is purely a State enterprise, State controlled and State managed, I must oppose the second reading of this Bill.

One hesitates to speak on a matter after an expert like the hon. member for Kimberley (Sir Ernest Oppenheimer), but we feel that if we have the raw materials in South Africa, then it is high time we exploited them. The industries at Newcastle and at Vereeniging have been mentioned, but they have only just commenced work, and have really done nothing up to the present. The position is that we have iron ore and coal in South Africa, that they still have to be worked, and that industries must be developed. We have been waiting for years, and nothing has happened. Things are beginning to develop everywhere in South Africa, and, where private capital cannot be got, it is a question whether it is not the duty of the State to tackle the matter, and develop the industry in the interests of South Africa. In Hansard one finds that the same objections were raised when the State wanted to establish the Land Bank. It was then said that it was not necessary nor desirable to establish the Land Bank. To-day, however, the Land Bank is welcome, and the farmers are very glad that the State did establish the institution. Secondly, we may look at the development of the State railways, and in the third place at the Electricity Commission; the Government housing scheme which was advocated feelingly by the hon. member for Yeoville (Mr. Duncan); State aided immigration for which the leader of the Opposition wants to vote £1,000,000 a year. There is no one in the Opposition who has got up to speak about State development in other countries. We have referred in that connection to New Zealand and Germany.

There are no State mines in Germany.

It is a fact. I will get Hansard and prove that mines have been developed by State aid. I can instance the Wilhelmina mine in Holland. What is the reason that capital cannot be found to establish the iron and steel industry on a big scale? In the report of the International Economic Conference of the League of Nations the position on the Continent—in France, Germany, Belgium and Luxembourg—is given, and it explains the position of the international steel agreement. Those are the countries on the Continent that produce the most steel, who for some years opposed each other, and have now established a monopoly with regard to the iron and steel industry. The agreement consists of 74 clauses which provide food for earnest thought. Do you think that an industry is being established here in the interests of those countries? No, they are opposing it. All who love South Africa must feel that the industry should be established if possible. Those countries, however, do not wish it. Take the position in England. In 1924 there were 482 blast furnaces in England idle, and only 172 at work, 35 English steel smelting places were not working and 29 iron smelting places in the Midlands stopped work and dismantled the works. Hence we see that England cannot, and may not, give its capital to South Africa to develop an iron and steel industry here because the creation thereof will be a death blow to England. I quoted from the economic report of the League of Nations why Germany would not furnish the capital. America will not do it either, because it is the leader in the steel industry. We cannot expect those countries to assist us, and, therefore, it is the duty of South Africa to establish the industry. I read in the Sheffield Chamber of Commerce Journal—

It is very clear that England feels it will be a blow to the English market if the industry is established here. It is our duty to see that the industry is created, and I cannot understand why the Opposition is against it. I am not an expert like the hon. member for Kimberley, I admit, but we, who prize the economic independence of South Africa, feel that if such a thing cannot be created through lack of capital then it is the duty of the State to develop the industry.

Where is the money to come from?

From the taxpayers.

Must they pay?

Certainly, why not? If the taxpayer can be responsible for the railways and the Land Bank and the Electricity Commission, why not for this industry as well? It is our sacred duty to create industry, if private capital cannot be found for the purpose. The hon. member for Caledon (Mr. Krige) called it socialism, and tried to stampede the House with that bogey. It is not socialism. Dr. Kuyper said that if private initiative could not provide for the development of the country the State must do so, and it would be foolish to accuse him of being a Socialist. The hon. member for Caledon also said that the object is to catch votes by giving people work: I have never heard greater nonsense. The only idea is the welfare of South Africa, and progress in economic matters. The Minister of Agriculture said that the industry would give work to 20,000 people. The hon. member for Newlands (Mr. Stuttaford) remarked that, at the start, work would be given to 1,500 people, but, if we notice how the steel industry developed in Germany, and how as many as 17,000 people work at one place, then you can see that thousands of people will be given work eventually. We feel that it is in the interests of the farmers, and of South Africa, and, therefore, we trust that the House and the Opposition will feel that they ought to vote in favour of the establishment of this industry.

The hon. member who has just sat down has given us a very exciting speech. He is so enthusiastic about the matter that he makes a patriotic appeal to us. It is just because we take so patriotic a view that we are so cautious. No rational man would object to the establishment of an iron and steel industry, but what we are concerned about is that it should be started on a sound basis. The hon. member for Kimberley (Sir Ernest Oppenheimer) has submitted certain provisions of the Bill to a very thorough, searching and, one might almost say, devastating criticism. I am only going to address myself to one aspect of the Bill and that is in regard to the basis of flotation. It seems to me this is the negation of all principles followed in regard to the flotation of companies. We have it here in the Bill that the Government will take 500,000 shares. The next provision is that three million ordinary shares shall be offered for subscription to the public at not less than par. There would appear to be no provision in the event of the public’s failing to subscribe for these shares. Where is the money to come from? The Minister may have an explanation in regard to this, and I should like him to give us the assurance, which is generally given in connection with a flotation of this character, that this money will be forthcoming from the public, in other words, that the money has been underwritten. Sub-section (2) of Section 7 provides for an additional £500,000 shares, which is also to be offered to the public. What guarantee is there that the public will take them up, and if not, where is the money to come from? The Bill makes no provision. As you ask the public to take up the bulk of these shares it is an axiom of flotations that if the public put up the money the public should have control. I would be astounded if any shares are taken up on this basis when you take the control from the people who find the money. Another very great weakness in the Bill is the appointment by the State of four directors out of seven. I know the Minister of Mines and Industries will make these appointments with the greatest care and thoroughly scrutinize them, and in his appointments will give effect to the Government’s wishes—to making a success of this industry. But I am afraid that the experience of filling up this directorate will be the same as the experience we have had in filling up the appointments on the railway board, which was formed to look after the interests of the users of the railways, and whose members are appointed for five years at a fixed emolument and cannot be dismissed by Government. One of the reasons which induced us in the North to go into Union was that the board would be independent and would be constituted to look after the interests of the users of the railways. But we know that this board has failed miserably and has been composed of politicians.

In what year?

Some years ago. But this is not a party question—I am dealing with the principle. I am pointing out as a possibility the danger with regard to what will happen in the future.

There was Mr. Johan Rissik.

There are exceptions, but generally speaking the offices have been filled by men who have followed politics for personal profit. This very present and real risk we are faced with in regard to appointments to the directorate of the company proposed was the Bill. Apart from all other aspects on this ground Only will I oppose the second reading.

We were told the other day that the Minister responsible for some of the clauses in the Precious Stones Bill had been suffering from economic nightmare; I think the Government when they evolved this Bill were suffering from an attack of economic delirium tremens.

The hon. member should not make use of such an expression.

Certainly they were suffering from acute economic nightmare too. We have a Cabinet not one of whose members has any personal knowledge of the steel trade and its allied industries. Every member is an amateur so far as the steel trade is concerned, and here they propose to plunge the country into an expenditure of untold millions on what is bound to be a failure. Their attitude is based on the Gutehoffnungshutte report, which I have studied, and which gives one the impression of being drawn up by very able, expert men, but we must remember they were unacquainted with local conditions and were not here very long. The report is based on private enterprise. If the German engineers had been asked to report on the Pretoria Steel Works as a State-run industry, they would have turned it down. It makes a big difference. The report may have been very sound at the time it was written, but since then circumstances have altered very much. The Government has adopted the report, but has turned down all local advice. It states in the report that pig iron stands at 280 gold marks. It is now said it is a printer’s error, but the whole Bill, it seems to me, is a printer’s error. If that was an error in the report, what was the price on which the report was based? In spite of what the Minister of Defence told us, the engineers did price the pig iron on the basis of £14 per ton. They gave galvanized sheets as priced at £23, whereas to-day they are £14; light rails at £16, and now they are £7 15s. In practically every direction there has been a huge fall in prices since the experts wrote their report. It says—

Here we find they are thoroughly unsound. The report makes a point of the adequate supply of water in Pretoria. We are not opposed to the industry being established in Pretoria, but we are entitled to know where we stand. The report states—

Now we hear that this water is to be obtained from sewage affluents, and some talk of getting it from Hartebeestpoort. I was there some time ago, and there will be civil war, or rather serious trouble amongst the farmers, if this industry is to get its water from Hartebeestpoort. We should not be hurried into this business before we know where we are. The Board of Trade backing up the Gutehoffnungshutte report says that the prices of iron and steel are rising all over the world—instead of which they are falling. The whole economic basis has radically altered since the report was written and since the Government came to its decision. The Gutehoffnungshutte report was based on the alleged inadequacy of ore at Newcastle, yet to-day there are untold quantities of good ore there, and far better than you can find at Pretoria. The report practically condemns the Pretoria ore, and it says that unless certain refractory elements can be eliminated a great deal of it will be valueless. So far I have not heard that they can be removed. The people of this country are entitled to more information. We find we are being rushed into this business. I do not say that the defects with regard to coke, limestone, fluorspar and all these ingredients which are lacking, cannot be remedied, but I do say that we should not be rushed into this. The Government, as a State industry, is going to compete with the iron industry—the most highly organized in the world, and is going to compete with great cartels in England, the Continent and America. We are foredoomed to failure. The Minister of Defence is fond of telling us—

It seems hardly necessary to point out the tremendous difference in principle between the running of non-competitive monopolies like the post office and the railways and competing in the most highly organized industry in the world. There is no parallel between the two. What is the reason for establishing such a State enterprise as this in South Africa? The Government’s reply is that because no one else will do so. But has private enterprise failed? As far as I can see, although private enterprise has failed to establish the industry at Pretoria, it has done so elsewhere under what seem to be more favourable conditions. Private enterprise has merely given Pretoria a wide berth. We have the Union Steel Corporation with a capital of £1,500,000, and it seems to me to be a curious way to encourage a new industry to set about throttling it in the way proposed in the Bill. We are told that Stewarts and Lloyds and Baldwins are going to start subsidiary steel industries, and they are doing so, not because of this Bill, but in spite of it, as they know that the State enterprise will fail. They look at this State enterprise as such folly that they are going on with their own works. That ought to make us think, if nothing else does before we spend all these millions on the Government’s project. I have no doubt the Government can make steel in this country, they can even build battleships, if they are prepared to spend the taxpayers’ money, but I am sure the thing will be a disastrous failure but the Government will be able to cover up its tracks by means of railway tariffs, rebates, customs duties and so forth. I am afraid that some of our Ministers, and some of the members supporting the Bill, are less concerned with the success of the steel industry than they are with the success of the political aspect of this business. A large section of our public are not very well informed on economic subjects, and, consequently, they are easily taken in by plausible economic fallacies. Speakers go to a meeting and ask the audience—

and the audience says, “ Yes.” The speakers then adopt a Napoleonic attitude, and say, “There you are.” This sort of thing forms the staple economic stock-in-trade of most of Our friends opposite. We have heard the hon. member for Pretoria (South) (Dr. van Broekhuizen) approaching the matter from a patriotic angle. We have also heard that patriotism is often the last refuge of various types of people, and also of men who know very little about economies. The hon. member for Pretoria (South) said not one word on the merits of the Bill, but made the same flashy appeal to South African patriotism.

He did not tell us how many shares he was going to take.

I do not suppose he will take one; I certainly will not. These people never worry about overseas competition, and forget the fact that in no country in the world has a State steel industry succeeded. The party opposite know that the bubble will not burst for some years, and they are relying on that fact. The industry will take about three years to get into its swing, another three years to prove its non-payability, and the next three years by manipulating costs the Government will be able to cover up its tracks, so that it will take a long time for these chickens to come home to roost. In the end, whether the public will be saddled with a financial loss does not seem to worry the sponsors of this Bill. In the Precious Stones Bill we had an example of a measure being forced on the country by the whim of a single Minister, and, in this instance, we have another Bill brought in by one Minister. It has been the hobby of the Minister of Defence, so one Minister is going to plunge this country into all this expenditure.

Your pet foible is stating incorrect things in the House.

Your pet foible is courtesy and urbanity. I can understand the Minister of Defence adopting the line he has, for all over the world Labour is prepared to spend every penny of other people’s money in propagating its pet theories, and here we have a typical example. Labour does not care what will be the fate of the industry, but it argues that by establishing a big industry it will get hundreds of workmen concentrated at one spot, and that will strengthen the Labour party. The Minister of Defence laughs, but the taxpayer will have to pay. The farming community is going through a very dark period, but we are going to throw millions into the water on a scheme which will not help the farmer, rather it will be a burden on him, for it will increase the price of steel and iron and agricultural implements. For a farmers’ Government to indulge in this exceedingly dubious venture, while the farming community is languishing, seems a curious procedure. I would like to know whether the Government is going to allow private manufacturers to compete with the State steel works for the business of the railway and, if not, why not. It will be a very curious method of helping the steel industry to close down an existing industry of that nature. Another point I would like to refer to is a curious printer’s error in Section 4—

It is the most curious printer’s error I have ever seen. In sub-section 2 it states in the Bill now before the House—

In the original Bill, as amended in select committee, there is not a word of this. One needs to be a sleuthhound to trace all these divigations of the Minister’s economic mind—or the printer’s devil. In the Bill, as amended by committee of the whole House, again not a word of this appears, but in the third reading this little printer’s imp slipped it in. I understand the Minister to say that he explained to the Senate it was a printer’s error. If he took the trouble to explain that to the Senate, he should have gone to the trouble of taking it out of the Bill. I do not understand the parliamentary position, Mr. Speaker, but I should like to know if we are entitled to move this clause out, for it seems that the Minister realizes that it is unworkable.

I have already explained when the Bill was before another place last time that I had put down in writing two amendments, if I recollect correctly, and the one was the excision of this “not,” and something else, and these matters have not been brought before me again. The Senate rejected the second reading of the Bill, and my attention not having been redrawn to the matter, the “not” has been put in. There was no intention to retain the “not” and that is the whole explanation.

It is full of “nots.”

It is the whole sentence that has been included. Still, we can amend it in the Senate. He has such a penchant for making amendments to amendments that I can quite understand the printer making mistakes.

The hon. member who has just sat down stated that he had read the German report. He must have read it very casually, or he would not have made the statement he did. He said there was no coal, iron or limestone in the vicinity of Pretoria. The German report stated that Pretoria is the most favourably situated for the erection of the iron and steel industry—centrally situated in the midst of the richest ore deposit in the Union, in close proximity to ore deposits and closely situated to the main trunk line from Cape Town to Rhodesia, and situated also close to the coking coal at Witbank. There has been a lot of criticism against the establishment of this industry, but not one single point of the German report has been controverted, and that report, I maintain, is the main crux of the Bill. One agrees with the criticisms of the hon. members for Kimberley (Sir Ernest Oppenheimer) and Cape Town (Central) (Mr. Jagger), and in nine cases out of ten every member in this House would be against State enterprise, but this is a key industry, and private enterprise has failed. It is admitted the industries at Vereeniging and Newcastle have failed for the reasons set out in the German report. The Newcastle industry has closed down because it is uneconomic. The German report stated if it is to be an economic proposition the industries have to be connected. There must not be a long railway journey between the two industries—the production of pig iron and the conversion into steel. The industry at Vereeniging is not fully equipped with machinery to turn pig iron into steel, and that was the reason the Newcastle works dosed down. The hon. member for Newcastle (Mr. Nel) gave his case away when he stated they were prepared to come in, after admitting they could not carry on, and he gave a whole list of the terms on which they would come into this concern, and foreshadowed there would be a 10 per cent. profit. Evidently the Union Steel Corporation are not as afraid of the venture as some members on this side of the House think they are. The hon. member for Cape Town (Central) (Mr. Jagger) was afraid of the market. Let me read the market reports from Sheffield, his own country. In the September number of the chamber of commerce report from Sheffield it says—

And it goes on to say—

That should disabuse hon. members’ minds that there is no market here. The hon. member for Caledon (Mr. Krige) referred to the criticism of the chambers of commerce. In the last four congresses of the Associated Chambers of Commerce of the whole of South Africa resolutions were passed favouring the establishment of a steel industry, and in their criticism of this German report the only matter they took exception to was that probably the railway would lose half a million pounds a year in steel goods which would not then be imported. That is a very feeble argument from a body of business men. If we have this wonderful ore in South Africa it is up to the country to develop it. The only argument brought forward by the Chamber of Industries was that they were afraid that under the Articles of Association the corporation was to take power to carry on the trade or business of ironmasters, etc., which they were afraid would interfere with established industries. Those are practically the only two criticisms made, and one realizes, in drawing up Articles of Association, companies or corporations take very wide powers, and it is not often those powers are exercised. The hon. member for Newcastle referred to the offer made by the Union Steel Corporation, and said the Government turned it down. In the first clause it was suggested that the Union Steel Corporation shares should be taken over at par. I can quite understand the Government turning that down. At a meeting of the select committee on railways some three years ago when this question was discussed, it was pointed out and admitted by Mr. Eaton, that the farm named “Kroondrai” had been put in amongst the assets at the value of £150,000, where originally it cost £12,000. One can understand the Government not accepting that. There is a criticism also that the German company failed to take up this industry in this country after bringing in such a good report. It was pointed out this company lost 1¾ millions in the occupation of the Ruhr, and it was impossible for them to establish the industry here. It has been said they bought a mine in Sweden. The position was this: A company managed by a man named Muller in Sweden got into difficulties. The company used to supply the German company with iron ore, and in order to make sure of the iron ore, they were forced to buy the mine at £250,000. A matter referred to frequently, one of the reasons I got up to speak, was the question of the water supply. The point has been made that the company are anxious to take water from the Haartebeestpoort dam. The position is that the municipality, and not the company, have been anxious to secure supplies of water and have several schemes. One would give them 6,000,000 gallons a day from Rietvlei, and they have an option to take 2,000,000 gallons a day from Haartbeestpoort. The municipality are also owners of Skinners spruit, rising on the townland at Pretoria, and the water court have granted them the right to erect a dam on their property and to the use of 500,000 gallons per day. It has also been proved that it is possible to use the effluent from the sewage from which they can get 2,000,000 gallons of water per day. The water position, as far as Pretoria is concerned, is quite safe. The main point and details of this Bill have not been criticised. The hon. member for Kimberley (Sir Ernest Oppenheimer) has agreed that the report of the German experts is one of the finest reports ever placed before the country on this particular subject, and, therefore, I intend to support the Bill.

Surely the opposition to this Bill which has been offered by the South African party cannot have been put up by that very virile party which represents primarily, the merchant and trading classes of this country and, to a lesser degree, the producing classes. If the opposition which has been put up to the Bill in the present instance represents the full extent of their condemnation of this scheme, then either the party has lost its virility or its spokesmen are praising this Bill with faint damns, as was said in this House in reference to another Bill. We have had the views this afternoon of the hon. member for Kimberley (Sir Ernest Oppenheimer), who is recognized as the leading “captain of industry” in the country; his industrial operations cover a wider and wider field and, apparently, he has come to be recognised as one of the pundits where industrial matters are concerned, more especially where the financial side of industry is under consideration. One has waited in vain to hear anything put forward by the hon. member for Kimberley, or by any of his side, which is really calculated to in any way impair or criticize forcibly the soundness of this scheme. The hon. member for Dundee (Sir Thomas Watt) said that, simply because it was a Government enterprise, it would be under Government, control, therefore, it would be administered by officials who could not be shifted summarily as is the practice in ordinary industry. He said that for that reason the business could not be economically conducted. He said also that the Government stroke is a slow stroke. That is the most cogent thing which was submitted to the House by the hon. member because if there is anyone in the House who should have a good idea of a slow Government stroke it is (he ex-Minister for Posts and Telegraphs, and when he sets himself up as an authority on Government stroke I do submit that we must bow to his judgment. When the hon. member has charge of a department in which he does not know what premises belong to the department, what premises they have to hire and a rental is not debited to his department, then I do submit that that hon. member is a fairly sound judge of how things should not be done under Government control.

You must try again.

The hon. member knows that what I say is correct. The hon. member for Kimberley put up a very strong plea on behalf of the financial mining houses of this country, and he said that the Government should approach those people who had made money and who had money available for investment through mining activities in this country, and that on patriotic grounds these people should be asked to finance this industry. Surely those people who have made money in the mining industry of this country have had ample opportunity all these years while certain prominent industrialists have been trying to get money to finance this enterprise. If we go over the history of this country, it is very difficult to find any avenue of industry which has been stimulated by the investment of funds which have been won from the mining industry. When I listened to the hon. member for Kimberley he struck me as making something like special pleading in reference to the control of our industries. If there is one sufficient reason why that should not be done, it is that it would be absolutely fatal to our industries to be placed under the control of one individual in this country. Surely a key industry such as this must not be put into the hands of one individual who can play ducks and drakes with it at pleasure. If the country is as patriotic as it is said to be, it would resent very much that such an industry should have been in the hands of the hon. member for Kimberley during the recent world crisis. If the methods adopted by the controllers of the mining industry in promoting mining were applied to a productive industry such as the iron and steel industry, it would, I think, be absolutely fatal to that industry. We know that they are not so much concerned in promoting that industry as a producing industry, but that this is really secondary to the greater industry of promoting the stocks on the market. We may take recent fluctuations of industrial stocks under their control. If we take a concern like the Sub-Nigel mine, we find that just as it were with the waft of a magic wand, the stocks of that mining property appreciated to something over three million pounds just on the receipt of a Government lease. We found the same with regard to the East Gedulds. Immediately the shares were offered to the public they were offered at a premium of something like 65 per cent. How are the public going to share in any industry which is promoted on these principles? Surely if it is a key industry and we are producing our steel and iron goods and producing in competition with other countries, we do not want these market fluctuations to apply to such an industry. The hon. member for Port Elizabeth (Central) (Col. D. Reitz) claimed that private enterprise had not failed in Newcastle. It seems to me that if private enterprise has not failed in Newcastle, it has certainly not succeeded, because it has overlooked the thing which this Bill provides for. It has overlooked the requirements of the secondary industries. This much-maligned Bill which has been criticized by the Opposition, because under Government management it must necessarily be loosely managed, makes provision for all those things which the Newcastle industry failed to do, and when you come to try and distinguish as between private enterprise and State enterprise in that regard, I think private enterprise suffers very much by the contrast. The hon. member for Port Elizabeth (Central) (Col. D. Reitz) said that politically this scheme seemed to have a great attraction for the Government. I notice that the hon. member for Pretoria (East) (Mr. Giovanetti) seems to have full licence to do what he likes on this Bill. His whole party are opposing the Bill, but the hon. member has a licence to support the Bill.

What about the hon. member for Pretoria (West) (Mr. Hay)?

The hon. member for Pretoria (West) is engaged in another productive industry, that of producing flags to order, but is is a great coincidence that the hon. member for Pretoria (East) of all people, belonging to a party which does not recognize any sort of political advantage in this Bill as a purely industrial measure, should be allowed to support the Bill. I do not know whether this industry is going to be established in Pretoria (East), but it is a significant thing that the representative of that district should give his blessing to the Bill. The hon. member for Port Elizabeth (Central) also referred to the poor farmer having to pay. If anyone were to go back over the history of the last fifteen years they would find that the poor farmer has paid. Any farmer to-day is paying twice as much for iron and steel goods as he paid fifteen years ago. He is paying double for his ploughshares, for instance. We know, with regard to fencing wire, and so on, all these things have gone up enormously in price. We do know this, that if this key industry were established in this country, if we were producing our own iron and steel products, the farmers themselves would certainly get the benefit of local production. Our friends of the Opposition cannot claim that the price of these things to the farmer has been kept down by private control. We do know that the whole fabric of control of the steel industry in Europe reposes to-day in half-a-dozen hands. Of all the big combines the steel combine is the most effectively closed combine of the lot. For that reason our friends here say: “You must put up your hands and surrender to the combine.’” I say, all honour to the Government which says: “We are not going to be frightened by any combine in our own country and much less by any combine elsewhere.” The reason why private enterprise has failed to grasp the opportunity to establish such an industry is that it does not want to set up in competition in the market supplied by its older plants established oversea. In spite of what the hon. member for Kimberley (Sir Ernest Oppenheimer) says, we find nothing in the history of the financial controllers of this country to reassure us that they will, at any time, do anything to establish any basic industry which will last for all time when the mining industry is petered out. This opposition by the South African party to the Bill does not ring true, somehow: it savours very much of a sham fight. When this Bill has been piloted through Parliament this session, our friends, the Opposition, will be amongst those who will quietly congratulate the Minister on having done something really useful for this country. This Government is providing a market for the farmers. That is something which your friends, the mining industry, have failed to do up to the present. They have provided a market in mealies for the compounds, but we do not want to build this country on the compound basis; we want a white man’s country. By setting up this industry, by exploiting these natural assets which we do possess, we shall really do something for the country which will be of lasting, permanent benefit.

My interest was aroused by the comment of the Minister this afternoon when the hon. member for Kimberley (Sir Ernest Oppenheimer) was speaking, and the Minister seemed very much perturbed about the point as to members not being eligible for reappointment on the directorate. He suddenly turns upon the hon. member for Kimberley and with that charm of manner which endears him to us, tells him he is practically wasting the time of the House because it was purely a printer’s error. How anyone was to know it was a printer’s error it is difficult to see. If it is an error at all it is due to the hasty way in which legislation was passed last session, and when it comes to blaming the poor printer that seems to be going a little beyond what is fair. On page 513 of the Votes and Proceedings, we find that at the report stage this amendment which the Minister says was a printer’s error was moved by the Minister of Mines and Industries himself as an unopposed motion and seconded by Mr. Brink. It appears in the Votes and Proceedings in precisely the same form in which it appears in the Bill now.

Are you still elaborating that?

I am simply pointing out that the Minister has put it down to the unfortunate printer. I want to know why the printer should be blamed.

The substance of my observation was that it was always intended to correct it, and intended to correct it in the Senate.

I was dealing with the Minister’s remarks with regard to the hon. member for Kimberley (Sir Ernest Oppenheimer), and his saying it was a printer’s error, when it is not the printer who is at fault, but the Minister himself. You will find the same thing in Hansard.

The whole thing seems to be a misunderstanding.

I am concerned only with the unfortunate printer, who cannot speak for himself in the House.

I suppose a mistake can occur in the Votes and Proceedings.

Let us turn to Hansard then—a mistake can occur there also. [Hansard read: Col. 2,681.]

Is it not clear that what he moved was—

Otherwise you would have objected.

The Minister of Mines and Industries may be quite correct that this is an error from beginning to end, or a printer’s error in the Votes and Proceedings, and in Hansard. The whole interest of the House now lies in this—like a fly in the amber—how did it get there?

What I should like to know is, how does this serious error affect the position of this Bill? Perhaps the Minister will tell us when he replies, because the Bill lays down that these gentlemen shall not be eligible for re-appointment. The Minister tells us his intention is that these gentlemen shall be eligible, and how does he intend to do that? Following the discussion and the ruling when the Colour Bar Bill was under discussion, to reserve a Bill for a joint session, it must be textually the same Bill which the Senate rejected. If you alter a single clause—not one grammatical error—it becomes a new Bill, and the right of the Government to claim a joint sitting, after the Senate has objected a second time to the Bill, disappears. This is only typical of a number of other alterations which I am sure the Minister has discovered by now may be necessary in the Bill.

I intend answering the points that are new, and I do not intend going again into the questions that were fully discussed during the last session. I was asked by the hon. member for Cape Town (Central) (Mr. Jagger) whether there is a report or a memorandum by Sir Robert Kotze which he drew up on the ore contents of Prestwick shortly before he resigned. I am not aware of such a memorandum, nor can I find one.

A report on the ore itself? I put two questions, the first of which was, I understood Sir Robert Kotze drew up a report on the project as it stands; and, secondly, as regards the new discovery of ore at Prestwick, you sent one of your own engineers down there—Mr. Milne.

There is not any report by Sir Robert Kotze on the whole project. As regards Mr. Milne, as I have already explained on several occasions, it is not a proper thing to ask for reports by officials

Surely it is in a case of this kind?

If the hon. member were sufficiently interested, he must recollect the reason I gave. It is a fixed rule in the civil service, and a fixed Ministerial rule, I think, not to divulge the reports of officials. Suppose you sent the inspector of mines to draw up a certain report; it is not the practice to divulge such a report.

Not a confidential report to the Minister, I take it.

The report is always to the Minister. The report is made to the Government mining engineer, and is then forwarded by him to the Minister. It is unsound and not the proper thing—not that I have any particular objection in this particular case.

Why is it not the proper thing?

Because it has always been, the practice of the civil service and the Ministers.

What about Dr. Wagner’s, report?

I laid it on the table because hon. members opposite all pressed for it, but it is really unsound.

I have never heard such a statement before.

It may be that the hon. member was: never informed by his department as to what the fixed practice was. I understand that was the fixed rule of the public service and that in the past Ministers always acted upon it.

Hear, hear!

Have you anything to hide?

Don’t suggest any hiding because in this instance I have broken a rule and laid everything on the Table. It is the spirit in which these things are said that does the harm. If we laid all the reports on the Table the Table would be littered with them.

Are you going to lay it on the Table?

—I am willing to lay a copy on the Table, but it is unsound and improper always to insist on official reports being laid on the Table.

Ministers must use their own judgment.

So far as I can judge the report does not show any material change in the position since the previous report. Hon. members will recollect that Sir Robert Kotze’s officers went to Prestwick both under the previous Government and shortly after we assumed office, and the reports right through were equally unfavourable. I do not accept for a moment the bald statement of the hon. member that the position has changed materially. The Government are of opinion that the position is sub-stantially the same. A question was asked about the water. An hon. member this afternoon made an observation from which I conclude that he now, for the first time, learns that the Pretoria municipality is prepared to give us the effluent for nothing. Why, the thing was mentioned repeatedly last session and nothing has been changed regarding the water supply. There is no idea of negotiating with Hartebeestpoort. We are to get one and a half million gallons of effluent water free and 500,000 gallons fresh water from the dam at cost price.

That is very curious, for we get our information from the Irrigation Department.

That is the position, which is entirely unchanged. The hon. member for Newcastle (Mr. Nel) asked me if an offer had been made to me by the company, and I told him that if an offer had been made it was substantially on the lines of the previous offer made to Maj. Butler which I believe was unacceptable. I take it to be an offer of a private nature, but if the hon. member is prepared to divulge everything I can tell him from whom it came. I have a letter from the hon. member for Hanover Street (Mr. Alexander) enclosing the offer read by the hon. member for Newcastle, and the very first point in that offer shows how unacceptable the whole thing is—

On the face of it this is an absurdity—we cannot accept that—that is my answer to that. The next question was the ratio of white to coloured. It is calculated in connection with mining operations that the total number of natives will be 2,185 and whites, 151, total 2,336; the iron and steel works of Pretoria, 987 whites and 768 natives, total 1,755; grand total, 4,091. But one has to take into account the increase of employment of subsidiary industries which will arise or which, if they exist already, will be enlarged at the consequence of the erection of these large iron and steel works. I come to Clause 4 (a) of the Bill. I am surprised at the elaborate arguments which have been built up on a mere nothing. It does not matter whether it was a printer’s error or not, for we never contemplated passing the Bill with the word “not” in the section. Hon. members smile. That is a spirit I cannot understand on the part of hon. members opposite.

You smiled yourself.

Do hon. members take my word or not

Yes.

What are hon. members smiling at?

Your sense of humour.

I have a file in which I have the documents when the matter was brought before this chamber on April 28th, and I have a copy of the Bill dated May 30th marked in my handwriting with correction for the Clerk of the Senate, and in this copy the word “not” is marked to be excised, which bears out what I told the House. The Senate, however, rejected the second reading of the Bill; therefore the committee stage in that House was not reached and there was no opportunity of moving this amendment.

You have not explained how “not” came in at all.

That is not of any importance surely. It was never intended to carry the Bill without the excision of the word “not” and that is all the point and substance. As a matter of fact there is another copy of the same Bill to which is attached a notice to the Clerk of the House, dated 25th April, three days before the third reading of the Bill in this chamber and the first amendment is as follows—

Why make such a fuss about the thing? That is a simple explanation. Now, after all this fuss has been made I will tell hon. members should it appear this “not” cannot be rectified I am not taking any risk with regard to the combined sitting by altering the word “not” and the Bill must go through with the word “not” in it. My own impression is it will be competent for the Senate to excise the word “not” and for the House to acquiesce in it and it will not destroy the chance of the Bill before the combined sitting. It is a matter which will be considered. The price of pig iron was discussed and my information is that the price of pig iron produced at Newcastle for the last six months ending 30th September, 1927, has fluctuated between £4 15s. 8d. and £6 5s. 5d. per long ton. I think I have now dealt with all the new points which have been raised.

Where are you getting the capital from?

I have stated if the public do not subscribe the Government will provide all the money and the State will take the necessary steps to provide it.

The taxpayer?

I suppose that is the obvious deduction. The hon. member for Kimberley (Sir Ernest Oppenheimer) has raised financial points. Either they were not raised last session or they were, and if not, I would like to know why he has thought of them in the meantime. My impression is that they were raised last session and were gone into fully and fully answered.

Have you the legal power to raise the money?

We have the legal power. We can bring it up in the Estimates.

Motion put and Mr. Jagger called for a division.

Upon which the House divided:

Ayes—69.

Alexander, M.

Allen, J.

Barlow, A. G.

Basson, P. N.

Bergh, P. A.

Beyers, F. W.

Boshoff, L. J.

Brink, G. F.

Brits, G. P.

Brown, G.

Christie, J.

Cilliers, A. A.

Conradie, D. G.

Conradie, J. H.

Conroy, E. A.

Creswell, F. H. P.

De Villiers, P. C.

De Villiers, W. B.

De Waal, J. H. H.

De Wet, S. D.

Fick, M. L.

Fordham, A. C.

Giovanetti, C. W.

Hattingh, B. R.

Havenga, N. C.

Hay, G. A.

Hertzog, J. B. M.

Heyns, J. D.

Hugo, D.

Kemp, J. C. G.

Kentridge, M.

Keyter, J. G.

Le Roux, S. P.

Malan, D. F.

Malan, M. L.

McMenamin, J. J.

Mostert, J. P.

Mullineux, J.

Naudé, A. S.

Naudé, J. F. T.

Oost, H.

Pretorius, J. S. F.

Pretorius, N. J.

Raubenheimer, I. v. W.

Reyburn, G.

Rood, W. H.

Roos, T. J. de V.

Roux, J. W. J. W.

Snow, W. J.

Stals, A. J.

Steytler, L. J.

Strachan, T. G.

Swart, C. R.

Terreblanche, P. J.

Te Water, C. T.

Van Broekhuizen, H. D.

Van der Merwe, N. J.

Van Heerden, I. P.

Van Hees, A. S.

Van Niekerk, P. W. le R.

Van Rensburg, J. J.

Van Zyl, J. J. M.

Vermooten, O. S.

Visser, T. C.

Vosloo, L. J.

Waterston, R. B.

Wessels, J. B.

Tellers: Pienaar, B. J.; Sampson, H. W.

Noes—46.

Anderson, H. E. K.

Ballantine, R.

Bates, F. T.

Blackwell, L.

Brown, D. M.

Buirski, E.

Byron, J. J.

Chaplin, F. D. P.

Close, R. W.

Coulter, C. W. A.

Deane, W. A.

Duncan, P.

Gilson, L. D.

Grobler, H. S.

Harris, D.

Heatlie, C. B.

Henderson, J.

Jagger, J. W.

Krige, C. J.

Lennox, F. J.

Louw, G. A.

Marwick, J. S.

Miller, A. M.

Moffat, L.

Nathan, E.

Nel, O. R.

Nieuwenhuize, J.

O’Brien, W. J.

Oppenheimer, E.

Papenfus, H. B.

Payn, A. O. B.

Reitz, D.

Richards, G. R.

Rider, W. W.

Robinson, C. P.

Rockey, W.

Sephton, C. A. A.

Smartt, T. W.

Smuts, J. C.

Struben, R. H.

Stuttaford, R.

Van Heerden, G. C.

Van Zyl, G. B.

Watt, T.

Tellers: Collins, W. R.; De Jager, A. L.

Motion accordingly agreed to.

Bill read a second time; House to go into committee on the Bill to-morrow.

I move—

1. (1) Save for the provisions of Section 115 nothing in this Act contained shall apply to any land in the Province of the Cape of Good Hope held under title which does not contain a reservation of precious stones in favour of the Crown.

I want to take this House back to the Bill, which was never passed in this House, but which went before select committees in 1923 and 1924. That Bill contained exactly the clause which I am moving in the amendment now before the House. The first clause of that Bill read—

Two select committees were appointed, and sat on that Bill. There were many divisions taken in the committee, and there were many points on which they did not agree, but there was one point on which they were unanimous, and that was the adoption of this clause which I hope the House will adopt now. I would like to read the, names of some of the members of that select committee. The first name is that of Mr. Munnik. I wonder if he is the same Mr. Munnik who is sitting in this House to-day. That gentleman voted in favour of this clause. To-day, apparently, he is going back upon the opinion that he held at that time. Then we have General Kemp. I presume he is the same gentleman who is sitting in this House to-day as Minister of Agriculture. He then offered no objection to this clause. He accepted it, but, apparently, to-day he has altered his opinion. Then you have Mr. Naudé. I take it that he is the same hon. gentleman who sits on the cross-benches. That hon. member was in favour of this clause which I am asking the House to accept. What has altered his opinion? Then we have again Mr. Sampson. I ask, is he the hon. gentleman who usually sits in the empty seat on the cross-benches. We have yet to learn from the hon. member for Jeppes (Mr. Sampson) why his opinion has been altered. I think this House needs a little more than the explanation which the Minister has given us for going back on a principle of this sort. It needs a little more explanation as to why hon. members who are now occupying ministerial benches felt two or three years ago that this was a principle not to be disturbed and to-day are casting their votes in favour of what is one of the most iniquitous Acts that we have been asked to pass in this House. Then again, if you look at Hansard, you will find that on the second reading of that Bill the hon. member for Barkly (Mr. W. B. de Villiers) said—

I hope that the hon. member for Barkly is going to support those words, and that they are not mere empty words. It is probable that we are not going to influence the Minister, but I do say that we are treading on a very perilous path in legislation of this sort. We have just passed the second reading of a Bill which stands for the nationalization of industries, a very big step towards the road of general nationalization of industries. Here the Minister is asking us to take a step whereby we are nationalizing mineral rights, whereby we are taking rights in land held under incontestable title, and going to nationalize those rights. Members opposite have run away from the idea they held in 1923, from the principles which the Minister of Agriculture and others voted for. I think the country is entitled to an explanation from these gentlemen as to why they have undergone this sudden conversion, and why the dulcet tones of their friends on the cross-benches have caused them to give up principles which they and their fathers before them held. I have no hesitation in moving this amendment. I hope that at the last minute the good sense of the House is going to prevail, and it is going to give effect to what every member knows is the feeling of the country on this matter.

I am sorry I cannot accept the amendment.

Question put: That the words proposed to be omitted stand part of the Clause; and Mr. Gilson called for a division.

Upon which the committee divided:

Ayes—65.

Allen, J.

Basson, P. N.

Bergh, P. A.

Beyers, F. W.

Boshoff, L. J.

Brink, G. F.

Brits, G. P.

Brown, G.

Christie, J.

Cilliers, A. A.

Conradie, D. G.

Conradie, J. H.

Conroy, E. A.

Creswell, F. H. P.

De Villiers, P. C.

De Villiers, W. B.

De Waal, J. H. H.

De Wet, S. D.

Du Toit, F. J.

Fick, M. L.

Fordham, A. C.

Grobler, P. G. W.

Hattingh, B. R.

Hay, G. A.

Heyns, J. D.

Hugo, D.

Kemp, J. C. G.

Kentridge, M.

Keyter, J. G.

Le Roux, S. P.

Madeley, W. B.

Malan, D. F.

Malan, M. L.

McMenamin, J. J.

Mostert, J. P.

Mullineux, J.

Naudé, A. S.

Naudé, J. F. T.

Oost, H.

Pearce, C.

Pienaar, J. J.

Pretorius, J. S. F.

Raubenheimer, I. v. W.

Reyburn, G.

Rood, W. H.

Roux, J. W. J. W.

Sampson, H. W.

Snow, W. J.

Stals, A. J.

Steytler, L. J.

Swart, C. R.

Terreblanche, P. J.

Te Water, C. T.

Van Broekhuizen, H. D.

Van der Merwe, N. J.

Van Heerden, I. P.

Van Hees, A. S.

Van Niekerk, P. W. le R.

Van Rensburg, J. J.

Van Zyl, J. J. M.

Vosloo, L. J.

Waterston, R. B.

Wessels, J. B.

Tellers: Pienaar, B. J.; Vermooten, O. S.

Noes—44.

Alexander, M.

Anderson, H. E. K.

Ballantine, R.

Blackwell, L.

Buirski, E.

Byron, J. J.

Chaplin, F. D. P.

Close, R. W.

Coulter, C. W. A.

Deane, W. A.

Gilson, L. D.

Giovanetti, C. W.

Grobler, H. S.

Harris, D.

Heatlie, C. B.

Henderson, J.

Jagger, J. W.

Krige, C. J.

Lennox, F. J.

Louw, G. A.

Marwick, J. S.

Miller, A. M.

Moffat, L.

Nathan, E.

Nel, O. R.

Nicholls, G. H.

Nieuwenhuize, J.

O’Brien, W. J.

Oppenheimer, E.

Papenfus, H. B.

Payn, A. O. B.

Pretorius, N. J.

Reitz, D.

Richards, G. R.

Rider, W. W.

Robinson, C. P.

Sephton, C. A. A.

Smartt, T. W.

Smuts, J. C.

Struben, R. H.

Stuttaford, R.

Van Heerden G. C.

Tellers: Collins, W. R.; De Jager, A. L.

Question accordingly affirmed and the amendment proposed by Mr. Gilson dropped.

Clause, as printed, put and agreed to.

On Clause 10,

I move—

As it stands, the Governor-General’s consent will be necessary for this.

Last session it was not necessary for the Governor-General’s consent to be required. I want to consider the existing position—I am not endeavouring to interfere with the prerogative of the Crown. I submit that last session, if it was perfectly competent to move this amendment, it is right to do so now. Subject to your ruling Mr. Chairman—

The hon. member may proceed.

When the matter was discussed last session those on this side who noticed the alteration of the law inquired from the Minister on what ground he proposed to do this, and the only information he gave was that it had become necessary because of a particular case. The fact that a certain amount of luck did attend the operations of the particular prospector concerned is no reason why the previous rule should be interfered with. This alteration is going to operate as a serious deterrent to the explanation of our rights to precious minerals. The discovery of precious stones may be restricted. Section 115 contains adequate power with regard to the restriction of production, but here we are placing a restriction on discovery. I do suggest that Clause 10, by restricting the activities of prospectors, will operate very harshly. If a prospector knows that the Government will deduct, say, 50 per cent. of the gross value of the stones found by him, may it not be that he will not spend any money at all on prospecting operations? When you come to the practical application of the matter, whether you are dealing with a “small man” or a larger concern, how will it be found possible to find the money for these operations if, say, 50 per cent. of the gross proceeds will be taken away by the Crown? What of the working expenses? What of the prospector who spends 90 per cent. of the gross proceeds on his work? They may find themselves incurring monetary loss because of the arbitrary application of this to a particular case. It is likely to interfere more with the smaller prospector than the bigger concern, which may, after all, be able to bear a loss of that kind. I should have thought that the Labour party, if they were not bound hand and foot to the Government in this matter, would have supported me, but they are not here and are elsewhere. That should not deter us from putting this matter before the Minister for consideration.

We discussed this matter fully last session and I met hon. members opposite by falling in with the suggested wording by the right hon. the leader of the Opposition. I am sorry I cannot accept the amendment.

Question put: That the words proposed to be omitted stand part of the clause; and Mr. Coulter called for a division.

Upon which the committee divided:

Ayes—64.

Alexander, M.

Allen, J.

Basson, P. N.

Bergh, P. A.

Beyers, F. W.

Boshoff, L. J.

Brink, G. F.

Brits, G. P.

Brown, G.

Christie, J.

Cilliers, A. A.

Conradie, D. G.

Conroy, E. A.

Creswell, F. H. P.

De Villiers, P. C.

De Villiers, W. B.

De Wet, S. D.

Du Toit, F. J.

Fick, M. L.

Fordham, A. C.

Grobler, P. G. W.

Hattingh, B. R.

Havenga, N. C.

Hay, G. A.

Heyns, J. D.

Hugo, D.

Kemp, J. C. G.

Kentridge, M.

Keyter, J. G.

Le Roux, S. P.

Madeley, W. B.

Malan, M. L.

McMenamin, J. J.

Mostert, J. P.

Mullineux, J.

Naudé, A. S.

Naudé, J. F. T.

Oost, H.

Pearce, C.

Pienaar, B. J.

Pienaar, J. J.

Pretorius, J. S. F.

Raubenheimer, I. v. W.

Reyburn, G.

Rood, W. H.

Roos, T. J. de V.

Snow, W. J.

Stals, A. J.

Steytler, L. J.

Swart, C. R.

Terreblanche, P. J.

Te Water, C. T.

Van Broekhuizen, H. D.

Van der Merwe, N. J.

Van Heerden, I. P.

Van Hees, A. S.

Van Niekerk, P. W. le R.

Van Rensburg, J. J.

Van Zyl, J. J. M.

Vosloo, L. J.

Waterston, R. B.

Wessels, J. B.

Tellers: Sampson, H. W.; Vermooten, O. S.

Noes—42.

Anderson, H. E. K.

Ballantine, R.

Blackwell, L.

Brown, D. M.

Buirski, E.

Chaplin, F. D. P.

Close, R. W.

Coulter, C. W. A.

Duncan, P.

Gilson, L. D.

Giovanetti, C. W.

Grobler, H. S.

Harris, D.

Heatlie, C. B.

Henderson, J.

Jagger, J. W.

Krige, C. J.

Lennox, F. J.

Louw, G. A.

Marwick, J. S.

Miller, A. M.

Moffat, L.

Nathan, E.

Nel, O. R.

Nicholls, G. H.

Nieuwenhuize, J.

O’Brien, W. J.

Oppenheimer, E.

Papenfus, H. B.

Payn, A. O. B.

Pretorius, N. J.

Reitz, D.

Richards, G. R.

Rider, W. W.

Robinson, C. P.

Sephton, C. A. A.

Smartt, T. W.

Smuts, J. C.

Struben, R. H.

Van Heerden, G. C.

Tellers: Collins, W. R.; De Jager, A. L.

Question accordingly affirmed and the amendment, proposed by Mr. Coulter, dropped.

Clause, as printed, put and agreed to.

On Clause 13,

I move—

My amendment is, to a large extent, interdependent to my amendment to Clause 19, and it would be much more convenient if the latter were taken first. I therefore move that the amendment stand over.

If this amendment is carried it will increase the discoverers’ rights beyond those contemplated in the Bill, and I regret that the committee cannot do that without first obtaining the consent of the Governor-General.

That objection was not taken when the amendment was moved last session.

No one is taking exception to it to-day. It is a ruling from the chair, but the hon. member can appeal to Mr. Speaker if he wishes.

It was my intention to raise the point in any case, and the same objection would apply to the proposed amendment to Clause 19.

The ruling raises a very important point. I move—

and that the Chairman be requested not to give a ruling until we have an opportunity to consider the matter. It is usual for the Chairman, when giving a ruling, to afford members, if they so wish, an opportunity of discussing it before the ruling is finally given. The point has been rather sprung on us, but if the Chairman’s ruling is accepted we need not trouble Mr. Speaker.

I accept the proposal of the hon. member for Bezuidenhout (Mr. Blackwell).

Motion put and agreed to.

On Clause 19,

I move—

I agree to that.

Motion put and agreed to.

On the motion of Col.-Cdt. Collins it was agreed to report progress and ask leave to sit again.

House Resumed:

Progress reported: House to resume in committee to-morrow.