as Chairman, presented the Second Report of the Select Committee on the Accounts of the South African Transport Services.

Report, proceedings and evidence to be printed and considered.

Mr. Chairman, during the second Reading debate on this amending Bill Opposition speakers kept on mentioning, particularly in regard to the amendment being proposed in clause 2, that the powers being assigned to directors were now being increased out of all proportion. It was alleged that unlimited power and freedom were being assigned to the directors of Iscor here.

The hon. member for Langlaagte and in a certain sense, too, the hon. member for Walmer even alleged that directors of Iscor would now be in a position to alienate the shares of the corporation. Farfetched allegations were made which I do not want to discuss in detail. The fact of the matter is that the shares of Iscor belong to the State and that the Minister of Industries, Commerce and Tourism is the proxy of the State in this connection. Consequently the shares cannot be alienated without the approval of and the eventual transfer thereof in writing by the Minister concerned. To maintain that the board of directors can simply decide to sell shares is utterly wrong. As in the case of an ordinary company, it is also the case here that directors can only take decisions in regard to shares over which they have full authority. If they wish to accept an offer from another company, they must go to the shareholders in order to put the offer to the shareholders. The proposal of the other company must be placed at the disposal of the shareholders. In no respect, therefore, are we concerned with the alienation of the shares of Iscor here.

Clause 2 does not seek to amend the powers of the board in regard to their obligations to the shareholders—in this case, the State—in this connection. The directors of Iscor are substantially under the same obligations as directors of companies that are subject to the Companies Act. The Iscor legislation was amended in 1979 in order to make changes to the Companies Act in regard to the liability of directors applicable to the corporation as well. They have to declare their interests in exactly the same way as other directors. Just like other directors, they have to take full responsibility for the decisions of the board.

This brings me to a question which the hon. member for Groote Schuur put to me on the position of Iscor vis-à-vis the Companies Act. In my reply to the question I said that I would establish what the precise position was. The hon. Chief Whip was correct when he said that Iscor was not subject to the provisions of the Companies Act. However, in terms of section 35 of the Iscor legislation, the Minister may make provisions of the Companies Act applicable to Iscor. The fact of the matter is that the Iscor legislation was drafted with a view to incorporating in it, as far as possible, the principles of the Companies Act. To a large extent, therefore, the principles and the provisions of the Companies Act were included in the Iscor legislation. In 1979 amendments were effected to the Iscor legislation in order to make further changes in the Companies Act in regard to the position of directors applicable to the directors of Iscor as well. The liability of the directors of Iscor consequently correspond materially with the provisions of the Companies Act.

The Iscor legislation contains all the material elements of the Companies Act. In fact, if one reads the Iscor legislation carefully, it appears that Iscor is in reality far more limited than a company would be that falls entirely under the Companies Act. Section 4 of the Iscor legislation specifies a considerable number of restrictions to which the corporation is subject but which are not applicable to other companies. The Iscor legislation therefore contains all the essential elements of the Companies Act, in respect of financial matters as well. This is particularly important because the question of whether the board of Iscor would not now be able to take drastic decisions without the Minister being required to be answerable for them was raised time and again. The fact of the matter is that Iscor, as far as financial reporting is concerned, also carries out requirements which are in accordance with the Companies Act. Section 28 of the South African Iron and Steel Industrial Corporation, Limited, Act provides inter alia in subsection (1)—

Those statements are then tabled in this House. The latest annual report was recently tabled here. Subsection (3) of section 28 reads as follows—

Those words are in precise conformity with the provisions of the Companies Act.

It may interest hon. members to know that in 1982 Iscor received an award from the Business Times, the Sunday Times and the Association of Chartered Accountants as the company which published the best financial report of all the unlisted institutions. This is an exceptional achievement for a company like Iscor and testifies to the meticulous financial reporting of that company.

It is therefore completely without foundation to allege that clause 2 is conferring excessively wide powers on the board of Iscor and that it detracts from the Minister’s liability and responsibility. The intention with this amendment is simply to eliminate unnecessary administrative red tape, to streamline the process, to remove unnecessary administrative burdens from the Minister and to enable the board to make its own decisions, just like other boards, concerning the compensation for the travelling and subsistence expenses of their directors. The intention is to be able to leave the determination of the allowances such as travelling and subsistence allowances which have to be revised from time to time by boards to the board of Iscor. The intention is not that the board itself will determine its own directors’ emoluments. It is the policy of the Government that it lays down a framework within which the various corporations themselves, depending on their circumstances, determine what the remuneration of directors should be. As I have said, it must, however, be within a framework or specifications laid down by the Cabinet. The initial proposal which we submitted in respect of clause 2 to the legal draftsman consequently provided that, although the Government would be able to establish the remuneration of directors, the board itself would be able to decide allowances. Owing to the problem of defining “compensation”, it was ultimately decided to use this wording.

This is not an important amendment. It is definitely not an amendment in regard to which I think we should wage a political dispute. I believe hon. members will agree with me that it is in the best interests of Iscor that there should be the greatest possible degree of unanimity of the administration of Iscor, that there should be the greatest possible degree of unanimity in this House, too, as to the responsibilities of the management and the responsibilities of directors of that company. The standpoint of the Opposition is, in my opinion, without substance, but under the circumstances which I have sketched, I am prepared to accept the motion of the hon. member for Amanzimtoti that clause 2 be negatived.

Mr. Chairman, I thank the hon. the Minister for indicating that he has decided to accept my proposal that this clause be negatived. I appreciate what he has said and the explanation he has given and in the spirit in which he has come back and said that it is very desirable that there should be as much unanimity as possible on these matters, I want to say that I very much appreciate his position and thank him for deciding to support my proposal.

Clause negatived.

Clause 4:

Mr. Chairman, clause 4 gives me a problem since we are dealing here with the non-registration of bearer stock. I continue to find it strange that we do not also regard bearer stock as part of ordinary stock and register it as well. It is a fact that if a bearer stock were to get lost, only the person in whose name that stock was still registered would be paid out. Let us assume, for example, that bearer stock gets lost. Let us say it takes six or seven months, and a dividend is paid out. One purchases stock in order to receive interest. What South African company does not register bearer stock? There could be good reasons to tell me today that perhaps it is not in the interests of a company in Great Britian, Barbados or some other place to have it known that it does in fact hold shares in Iscor, South Africa. However, this argument does not hold good in the South African situation. We want to know who the people are who own this stock. I think it is essential to know who owns a company’s shares. In my opinion, bearer stock remains the same as any other share and I cannot see why we cannot in this case keep a register in exactly the same way as it has been done the past 20 to 30 years. We talk very readily about red tape, but I have come to realize that if one does away with it one is sometimes doing away with sound control as well. There are points of control one is doing away with. Consequently, it is my earnest request that we should look into this matter again and that the hon. the Minister should at least give us a better explanation. In any event, I am not satisfied with the present one he has given us. If one looks at the explanations we have received, such as those I received over the weekend from certain companies, of the question why these bearer stocks should not be registered, what emerges is that the only reason for this is that the person who purchases that stock would not like to have his name disclosed. I am therefore asking the hon. the Minister to give us an explanation in this connection.

Mr. Chairman, I have already dealt with the question of bearer stock and ordinary stock. I did so during the Second Reading debate. The hon. member for Langlaagte is making two mistakes. In the first place, we are talking here about stocks, debentures, and not about shares. In the second place, the definition which has already been accepted in clause 1 makes provision for bearer stock. Bearer stock is not made out to a person in the same way as an ordinary stock.

But it is registered.

Bearer stock is a debenture which may be redeemed on presentation. Let me quote the hon. member for example. If a company wishes to attract R50 million, or any other amount, on the capital market, it can make use of various financial instruments in order to do so. The corporation can also issue bearer stock for a certain amount which then earns dividends over a number of years or which bears capitalized interest and which may then be redeemed after a specific period of currency. I have been informed that this form of debenture is very popular, particularly in Europe, where the financial institutions are sophisticated enough to be able to deal with it. Bearer stock has perforated strips which can be torn off. If it is a five-year stock, then there are five strips attached to the bearer stock. Upon presentation of these strips to the establishment dealing with the bearer stock, the necessary dividend is paid out, or the full amount may be paid out after effluxion of the period of currency of the bearer stock. There is nothing strange about this. All that is being contemplated here is to expand and improve the instrument of the corporation for attracting capital, particularly in overseas countries. Administratively it is also of great value if bridging capital is sought in the short term. This can then be made available by means of such stock. Up to now the corporation has been restricted in this regard. However, it will also be possible now to issue debentures on a bearer basis without recording the transaction in a register. Finally, this has nothing to do with the shares of the corporation, but merely with the acquisition of capital which the corporation requires from time to time.

Mr. Chairman, section 25 of the Iscor Act has always provided that when stock is issued, a register of such stock shall be held.

We are now giving it a broader base.

Yes, but I am just afraid that we may give it too broad a base. We cannot get away from the situation in South Africa. We sold Sasol at a time when we were still unaware of whose hands it would fall into. When Iscor is sold off in the same way to other companies, at least I want to know who pays in the capital for this bearer stock. All I want is that we should be informed here in Parliament as to precisely what the standpoint of the Government is in regard to the selfing off of such companies. I concede that it may perhaps be a good method today to say that we are not going to register bearer stock in terms of section 25.

It could give rise to red tape. However, I have the fear that we are, within a very short time, going to sell off another of these big companies, and I just want to make sure that we know precisely who provides the capital for that purpose.

Mr. Chairman, I had not really intended to reply, yet I am going to explain the matter to the hon. member once more. The hon. member is confusing shares with stock. It is impossible to privatize Iscor with stock. What we are concerned with here are loans, of obtaining money on the money market, for which proof must then be adduced. Whether that proof is in the form of a debenture to a person or in the form of an anonymous debenture which is made good to the owner, these are two methods of attracting loans. Iscor—and no other corporation either—is not able to divest itself of its shareholding in this way. The hon. member for Langlaagte apparently does not understand that what we are dealing with here has nothing whatsoever to do with the transfer of shares, but is concerned with borrowing powers, to attract capital from the market, and the way in which this is being done.

With this explanation, Mr. Chairman, I think this matter has been presented to this House as thoroughly as I am capable of explaining it.

Clause agreed to.

Clause 5:

Mr. Chairman, just as in the case of clause 2, I am also prepared, in the present case, to accept the motion of the hon. member for Amanzimtoti that the clause be negatived.

Mr. Chairman, I thank the hon. the Minister for accepting our views in this regard and my proposal that this clause be negatived. In so doing, he has removed the two major objections which we had to this measure.

Clause negatived.

House Resumed:

Bill, as amended, reported.

Third Reading

Mr. Speaker, I move, subject to Standing Order No. 56—

Mr. Speaker, supporting the Third Reading of this Bill I should like to thank the hon. the Minister for agreeing to drop clauses 2 and 5. I believe he will find this of great benefit in the long run to an organization which occupies such a crucial place in the South African industrial spectrum. The reason we had for asking for the withdrawal of those two clauses is that we believed they would in quite a serious manner upset the true relationships that should exist between the hon. the Minister and the board of directors of the organization.

We are a little concerned that the Cabinet, apparently in March last year, established this procedure as a method of dealing with the boards of State corporations. We hope we will not see its introduction in respect of other State corporations. If we do we will be constrained to resist it again because this procedure is not in the best interests of the country.

Iscor has a unique place in the South African economy. It is a concern of tremendous size and strength, but it has tremendous problems too facing it at the moment. We are all aware of these problems. One of them is the obsolesence that tends to make itself felt in such a capital-intensive enterprise. Steel industries throughout the world are suffering from this problem. How do the steel industries of the old countries, with the older installations, compete against countries with modern new installations, frequently in countries with a lower general level of wages? I think it is important that we bear this in mind because the time will come when we will have to decide whether major extensions to the Iscor plant can take place. We might also from time to time benefit from a certain degree of importation of steel. Importation of specialized steel already takes place today. This is the best way of monitoring Iscor’s cost structure. I realize that this is being done to a certain extent, because Highveld Steel is in the steel market today as well.

We will be supporting the Third Reading of this Bill. We believe that Iscor has a long and important road ahead of it.

Mr. Speaker, I thank the hon. member for Walmer very sincerely for his support for this piece of legislation. I am pleased that there is unanimity in this House on this legislation. Personally, however, I am a little disappointed that clauses 2 and 5 have been withdrawn. But it proves once again how democratic we are in this country [Interjections.] Today democracy was put to the test, and the hon. the Minister won. He proved to that hon. member that we can be democratic. [Interjections.] Over the years the board of Iscor has shown us that it can under all circumstances act in a responsible way and in the interests of South Africa. [Interjections.] That is why we should now like to see Iscor being treated like any other State corporation, and that Iscor can at least take its own decisions on the allowances that are to be paid to its directors and executives. As I have said, I am pleased that the hon. members now agree. Unfortunately this does not apply to the hon. member for Langlaagte, but in my opinion it is in his case a question of a misunderstanding. I think the hon. member must draw a distinction between shares and debentures. There is a big difference, but I do not think the hon. member is capable of drawing the distinction.

Must I tell you what the difference is? It is the numbering system.

I gladly support the Third Reading of this amending Bill.

Mr. Speaker, as the hon. the Minister is fully aware, my party, the NRP, opposed the Second Reading of this measure because of clauses 2 and 5. The hon. member for Algoa says that the hon. the Minister’s accepting my proposals that clauses 2 and 5 be negatived, is a good example of democracy. I would like to suggest to him, however, that it is rather a good example of the hon. the Minister showing good sense and accepting what is right for South Africa.

Our opposition was based on a very fundamental principle, and that is that where the State’s funds—or the taxpayers’ funds—are concerned, this Parliament, through its representatives, in this case the hon. the Minister, must retain accountability. The two clauses that have been withdrawn were actually going to reduce the responsibility and the accountability of the hon. the Minister. That was the argument I put forward in the Second Reading debate. I thank the hon. the Minister for seeing the good sense in that. I want to tell him that we in these benches appreciate, very much indeed, the attitude that he has displayed in listening to our argument and seeing fit to withdraw these two clauses.

We will indeed now be supporting this measure at Third Reading.

Mr. Speaker, it is inexplicable to me how an hon. Minister can make the kind of speech which that hon. Minister made on Friday—or at least last week—in this House, and then, after the arguments which were raised today, withdraw the clauses in question.

But that is what Parliament is all about!

Yes, what the hon. member has just said is true. The hon. the Minister indicated why the people of Iscor should receive certain rights and said that nothing was being taken away from him as Minister, no responsibilities. However I told the hon. the Minister that there was a contradiction in this clause, because the recommendation in the one clause was at variance with a recommendation in the other clause. However, the hon. the Minister said that that was not true. After a weekend’s rest, and having slept on it, the hon. the Minister stated today that he accepted the hon. member for Amanzimtoti’s motion. Although I agree with it, of course, I should like to know what the consequences would have been—the hon. the Minister could indicate this to us in the Third Reading—if the original presentation had been proceeded with.

You must work that out for yourself.

Yes, I worked it out for myself. I am not like hon. members on the NRP side. I have worked it out myself. I should like the hon. the Minister today to give us his reasons why he decided to withdraw these clauses.

The hon. member for Amanzimtoti told you.

I come now to clause 5. I have already indicated to the hon. the Minister that I have problems with this clause in so far as the provision pertaining to the auditor is concerned. Fishcor is one of our biggest problems today. One cannot get so much as a glimpse at anything there. Precisely the same will happen in the case of Iscor. It is for this reason that we have made our request to the hon. the Minister.

The hon. the Minister is trying to explain to me the difference between a stock and a share. But there is no difference between the two. One can use a share to raise a loan. In addition one can convert money one has invested in stock into shares. There is no problem. [Interjections.] It simply depends on what transaction one wishes to conclude. In any event I am pleased that the hon. the Minister has seen the light and has withdrawn the two clauses.

Mr. Speaker, I should like to thank hon. members for their contributions. I still maintain they tried to read too much into the Bill. However, we have settled our differences. I should now like to comment finally on some of the remarks made by hon. members.

*I want to begin with the hon. member for Langlaagte, and I want to refer once again to the difference between stock and shares, without repeating my previous explanation. I just wish to draw the attention of the hon. member to the fact that the share capital of Iscor is issued in terms of legislation of this Parliament. The number of A-and B-shares is determined in section 16 of South African Iron and Steel Industrial Corporation, Limited, Act. The remark made by the hon. member about alienation must also be seen against this background. The Minister, as the proxy of the State, must give his consent when shares are sold or alienated. This is unlike the case of debentures for attracting funds for Iscor according to its need.

The hon. member also wanted to know from me why I had withdrawn these clauses. Surely I explained that during the discussion of clause 2. I think it is necessary, and a good thing, that when it comes to the business activities of the State, we should manage these on a level which is elevated about political differences. We must try to achieve the greatest measure of unanimity in this sphere. Although I am still of the opinion that it is not in any way the intention of this clause to convey powers to the board of Iscor which will detract from the responsibility of the Minister, I am nevertheless prepared to withdraw that clause. The effect of clause 2 would simply have been that the board would have been able to decide on the tariff per kilometre that had to be paid as compensation to the directors, as well as the allowances for subsistence expenses. However, we shall, in the interests of unanimity, be able to deal with this, in respect of Iscor.

I thank the hon. member for Algoa for his contribution. I also thank the other hon. members who participated in the other stages of the debate, as well as the Opposition for their support for this legislation.

Question agreed to.

Bill read a Third Time.

Mr. Speaker, I move, subject to Standing Order No. 56—

Mr. Speaker, this amending Bill contains amendments to the principal Act which we hope will be to the benefit of everyone. The question of making liquor more widely available has been frequently discussed in this House and in many respects the argument was advanced that this would be to the benefit of the public. However, it was also pointed out that at one stage in our history we adopted a certain method of making liquor available to people and that this has more or less become a pattern of life. I pointed out that ever since liquor licences were allocated to certain large chain stores, this contributed to the family being able to acquire liquor readily, which then appeared in homes and in refrigerators on a hot day, and that children very often consumed that liquor without the consent of their parents who were working. Today I want to say that that liquor consumption is in future going to cause us problems.

I also said that Latin American women were not liquor consumers, but that the men were. On the other hand, we Anglo Saxon people, men and women, consume liquor together. We in South Africa must realize that many thousands of rands are being spent by the media on liquor advertisements and I believe that this should not be done at all. We also find these advertisements on our buses and at our bus stops. In addition there are many misrepresentations in advertisements in respect of the effect of beer on young people and various kinds of liquor are advertised for the mere purpose of increasing the consumption of such beverages. If we in South Africa think that liquor is bad for people, I think we should look into the matter seriously, in this respect as well.

I know there are many people who think that culture comes only out of a bottle. There are many people who say that the Cape only has culture because it has wines. No, there were great authors who held other views in this regard. I think it was Beerstedt who said—

He did not merely refer to a person who drank a little red or white wine.

That is not entirely correct.

Therefore people should not merely draw a line to distinguish what culture is; and say that a person who does not drink wine has no culture. That is more or less what one has recently found here in the Cape.

I want to make an earnest appeal. The hon. the Minister knows what our standpoint in this regard is. Over the years we had a Liquor Board which had control over the consumption of liquor. There were specific ways in which a liquor licence could be obtained. We know that the quota system has been removed and that in the larger centres one can find four, five or six liquor shops in that area even though 50 Whites were living in that specific area, just as long as people frequent those liquor stores. It makes no difference whether the visitors to the liquor stores are people who do not live in that area at all. Therefore it is my request that we should in any case give earnest consideration to the danger which liquor constitutes to our community.

Mr. Speaker, I do not intend reacting to the speech which the hon. member for Langlaagte made here. I think the remarks which the hon. member for Ceres made during the Second Reading debate are also applicable in reaction to the speech which the hon. member for Langlaagte has just made, because the hon. member for Ceres indicated in a very calm and stylish manner how liquor consumption could occur in a very respectable way. I do not think that I wish to elaborate on this any further.

Throughout the debates on this Bill I looked forward eagerly to debating the merits of the legislation under discussion. Since we have now reached the Third Reading debate, the time has in fact arrived when we can discuss the effects which the application of the legislation will have. I want to refer in particular to two outstanding aspects of the legislation.

The first matter has been argued in detail. It is concerned with the fact that the Government is not intent on doing away with specific standards when it comes to the distribution of liquor. We wish to maintain those standards because we are convinced that liquor is a commodity which can lead to social abuse. For that reason we cannot allow the distribution of liquor in an unquailfied and unhindered way. I am of the opinion that that point has been dealt with fully.

Another matter which in my opinion has exciting possibilities did not, however, receive the attention it ought to have received. I am referring to the clauses which are intended to streamline liquor distribution in Black areas and also to make it possible for the competent authority to condone certain previous convictions so that the persons involved cannot be condemned because of previous convictions when it comes to new liquor applications. I think that with this clause, read in conjunction with the statement which the hon. the Minister of Industries, Commerce and Tourism made on behalf of this Government in March this year, new doors are being opened for the establishment and stimulation of a Black entrepreneurial class.

We ought to appreciate very much the steps taken by the Government in this direction. In the statement of 25 March the Government confirmed its intention to phase out the role which the administration boards had played in this connection. Now the Government has introduced this measure and states that certain procedures for Black dealers will be streamlined and that the position for them will in fact be adjusted so that they can establish themselves as small businessmen. As far as I am concerned this is probably one of the most exciting elements in this legislation. Liquor distribution and liquor provision in Black residential areas has over the years been termed a thorny issue. We are most certainly not saying the last word about it today either. Since we have to deal on the one hand with the phasing out of the role of administration boards and on the other with the important aspect of the establishment of a stable middle class and entrepreneurial class in the Black areas, the one must not exclude the other. What worries me about the statement which the hon. the Minister issued on 25 March is that liquor provision is still being linked to a financial role for the administration boards. I do not think we should allow the establishment of a Black entrepreneurial class to miscarry because we had problems with the financing of the administration boards.

This step is to be welcomed. The effect it will have on so many socio-economic problems in our central urban areas and also on proper and orderly distribution of liquor in our Black residential areas is only to be welcomed.

Mr. Speaker, I should like to reply briefly to a few of the remarks made by the hon. member for Langlaagte. During the Second Reading debate I went into the matter in greater detail. The hon. member stated categorically that this legislation made it possible to make liquor freely available. That is not the case. I also pointed out in my statement earlier this year that the Government was not in favour of a free licensing system.

The hon. member expressed kindly words in regard to the Liquor Board. I want to assure him that the Liquor Board will continue to allocate licences in the same responsible way, subject to the needs and subject to the provisions as laid down in the Liquor Act. Therefore it is not a question of free distribution. This amendment seeks to bring the Act into line with the practical needs of our day.

The hon. member also referred in passing again to grocers’ wine licences. This legislation does not deal with that matter. The introduction of grocers’ wine licences a few years ago is a matter which has to be assessed on its own merits and arose from the Government’s intention to promote liquor varieties with a lighter alcohol content.

The hon. member must not confuse the use of liquor with the abuse of liquor. I think everyone in this House is strongly in favour of a responsible use of liquor. The responsible use of liquor is part of a larger pattern of life, of a way of civilization, of a culture. The hon. member referred to the culture and spoke about our writers. He will have noticed with how much praise some of our great writers have over the years referred to the consumption of liquor, and for the most part to the responsible consumption of liquor. Incidentally some have, in fact, also referred to liquor in a less responsible way.

†I recall what the very famous South African author, Herman Charles Bosman, wrote about Oom Willem Prinsloo’s peach brandy. Let me quote from the book Herman Charles Bosman. In the story Willem Prinsloo ’s peach brandy the author has Oom Schalk commenting drily—

*The amendment contained in clause 14 makes it possible for the cultural history institutions and the cultural museums in South Africa to market some of their products. I hope that the visitors will not find that the quality of the product is as potent as the one referred to in Herman Charles Bosman’s book.

The hon. member for Krugersdorp referred to an important aspect which is not only incorporated into these statutory amendments, but which is also the declared policy of the Government, namely to give the Black entrepreneur the opportunity to play a greater part in the marketing of liquor in Black residential areas. There are problems. Finances are one of them. The State is investigating sources of financing. The matter has been debated here time and again that it is not a good principle that an important source of income for administration boards ought to be the distribution and sale of liquor. However, the fact remains that at present it is a material problem for administration boards, and if this source is simply cut off or if they were deprived of it, it would create serious problems for boards in the discharge of their obligations in Black residential areas. Attention is being given to this matter at present. However, there are other problems as well. There is a specific resistance in Black areas themselves that has to be overcome. The Liquor Board, in conjunction with the Department of Co-operation and Development, is looking into these matters and we hope to make rapid progress in this connection.

I thank hon. members for their support.

Question agreed to.

Bill read a Third Time.

Mr. Chairman, I move the amendment printed in my name on the Order Paper, as follows—

I think this amendment is self-explanatory. It just extends the definition of “acquisition” further.

Amendment agreed to.

Clause, as amended, agreed to.

Clause 5:

Mr. Chairman, there is something in clause 5 that worries us. The proposed new subsection (4) provides—

We do not want a situation to develop where the Minister may make known such a report in some way other than laying it upon the Table. I accordingly move the following amendment—

Mr. Chairman, the object of this amending clause is to enable the Minister to furnish interested parties, the parties involved, timeously with reports, even before they are tabled, in order to expedite the procedures involved. Under the legislation as it has been up to now the Minister has been hamstrung in that he could only make the reports available after they have been tabled in Parliament, or have been fully published in the Government Gazette. Even after having tabled reports, if the Minister wants to act on a recommendation by the board he still has to publish it in the Government Gazette.

There is no intention not to table these reports in Parliament. As a matter of fact, the legislation compels the Minister to table the results of all formal investigations by the board. So, even if the Minister received a report before hand and take action on it, eventually it still has to be tabled in Parliament. The concern of the hon. member is therefore fully covered by the legislation itself. This particular clause does not concern itself with the tabling or non-tabling of reports. Here the option is given to the Minister to do two things. In the first place he may furnish the report to the people involved so that they can act on the recommendations contained in the report and, in the second place, he may act on recommendations of the board without having to table it first or having to publish it in the Government Gazette.

So, if tabling the report in Parliament is what the hon. member is aiming at with his amendment, I must inform him that that is already being covered by the legislation. That is what is happening at the present moment and that is what is going to happen in the future. I wonder whether in the light of this the hon. member would not consider withdrawing his amendment.

Mr. Chairman, it is not I really a question of reports being tabled in Parliament. It is a question of whether they have been published in the Gazette and/or in some other way the Minister may choose.

That is where the problem lies, Mr. Chairman. By publishing it in the Gazette it ties down the whole operation. At the moment the position is that the Minister must table reports. What the hon. member asks for now is for reports, after they have been tabled, also to be published if the Minister wants to act upon them. Let me point out to him that many of these reports are lengthy reports. The hon. member’s amendment nullified the amendment put forward in the clause. I am therefore not prepared to accept his amendment.

Amendment negatived (Official Opposition dissenting).

Clause agreed to.

Clause 6:

Mr. Chairman, the same situation pertains here.

Mr. Chairman, I think we have sufficiently debated this matter.

Clause agreed to.

House Resumed:

Bill, as amended, reported.

Third Reading

Mr. Speaker, I move, subject to Standing Order No. 56—

Mr. Speaker, this legislation is bound to increase in importance in this country in the years to come. I am fully conscious of the difficulties with which the hon. the Minister is faced, but I, and also my party, are alarmed about the fact that the amount of money budgeted for this extremely important body is being cut back for the financial year 1983-’84. The fact that this is being done indicates that there is insufficient motivation behind this body. While we are conscious of the work the Government has to do and of the difficulties with which it is faced, we would like the hon. the Minister to give the Competitions Board the type of muscle that it needs to be an effective body. The shortage of staff the board is experiencing is extremely alarming. To do its job properly it is necessary not only that it should have the required number of staff units but also that it has people of the desired quality.

Mr. Speaker, we support the Third Reading of the Bill.

Mr. Speaker, we in the CP are also concerned about the functions of the Competition Board. This board was only introduced at a late stage of our economy. I think that we have some of the most effective and clever business organizations in the world in South Africa, because they are, one could almost say, family orientated in the sense that organizations have cooperated with one another over the years. Think, for example, of the mines where one finds that there is almost a kind of partnership between them. The same situation applies to petrol companies who also work together against overseas competition. In other words, there is a partnership between them. When we think, for example, of the Coal Owners’ Association, we also find a group of people who know each other well and work together well. The Competition Board really has a very difficult field in which it has to operate. To control matters or to intervene in this sphere, one has to have one’s wits about one. One cannot simply allege that a cartel has been formed because two undertakings are selling their goods for the same price. In particular, problems arise in cases where there is no documentation. In a great many cases agreements are entered into without any form of documentation. One could, of course, ask why we are discussing this. The reason why I am discussing this is because I would like to see Parliament, the relevant Minister and the Cabinet giving absolute support to members of the Board involved in this matter on the basis of the reports they have to make. If organizations forming cartels are to be kept in check, penalties will have to be imposed on them which are severe enough to hit them where it hurts most. For example, it serves no purpose to impose a fine of R50 000 on a person who earns R100 million with a small component. That means nothing.

In our present-day situation, where 85% of the Stock Exchange is already intertwined, and where certain small groups of manufacturers team up and only deliver their products to certain groups, it seems as if things have already gone so far that from the outset the Competition Board was saddled with a virtually impossible task. That is why we are asking that Parliament and the Government give very serious attention to the difficult task which the Competition Board has to perform. If necessary, the board should even be enlarged. The board should be able to call on specialized witnesses, and should have the right to call on the services of people with specialized knowledge. People will also have to be given indemnity when they give evidence. These are aspects which will still have to be introduced into the legislation under discussion if we really want the Competition Board to do justice to its task.

We take pleasure in supporting the Third Reading of this Bill. We also ask that in future more monetary assistance be given to this board.

Mr. Speaker, during the course of my speech I shall return to the hon. member for Langlaagte, and I shall also refer to the hon. member for Walmer, particularly in connection with other statements he made in other debates, statements pertaining to the legislation we are now discussing.

I personally believe that it is fit and proper that the Competition Board should be strengthened. It is true to say that we need such a watchdog organization in South Africa, and I also think that we may have even more need for it in future. It is also a fact that the mere existence of this Competition Board will have a salutary effect on possible future offenders.

Yet such a board, in its findings and in the recommendations which result from them, cannot be the alpha and the omega in a case. Let me put it as follows. A board or a commission, a committee of inquiry, or whatever, is and must always be subject to decisions of the Government. These boards and similar bodies are only aids to orderly government. No government—and I want to emphasize this—can ever govern through a board, a commission, a committee or a pressure group. No government can do that.

It goes without saying that a government must take all interests into consideration, particularly in cases where such interests have been in existence for a long time, and one could even call them vested interests. In previous debates the hon. member for Walmer referred to certain recommendations of the Competition Board and the acceptance of certain aspects of the recommendations by the Government. This is exactly the same principle that is being applied in this case. It was the Competition Board that recommended absolute separation between the wholesale and retail trade in the liquor industry, and the resultant dissolution of Cape Wine. At the moment all kinds of accusations are being made and these are being gratuitously repeated by people. It would seem to be a matter of: The less they know, the more noise they make. We also find this in a very well-known financial publication. However, I do not think one can attach much value to its opinions because this same publication mentioned four KWV directors who are supposed to be members of this House, whereas there are only three, and if a person does not know the difference between three and four, I do not know whether one should pay any attention to his opinions. This publication has never been known for its love for the farmer of South Africa and his organizations, the Agricultural Unions and co-operatives. What is really strange, however, is the fact that these few men from the wine industry have been singled out as a so-called pressure group, while all the other interest groups who addressed representations to the Government in this connection are not pressure groups. Perhaps I should accept that in this case the end justifies the means. I want to make it quite clear that this group is an interest group which, like all the other groups, made representations, and that this group furnished facts, as I think other groups also did. Fortunately—and I want to state this categorically—the wine farmer has a Government which listens to him, particularly when he furnishes facts on behalf of his industry and his fellow farmers. We in agriculture are truly grateful that the Government is always willing to listen to the farmer. It has to be accepted that we certainly do not always agree wholeheartedly with one another. That is only logical. In the history of South Africa there has, however, never been a Government that was as close to the farmer as this Government is. From all this one could then, tongue in cheek, deduce that it would perhaps be worthwhile if certain other industries also made sure that they had people here.

Having said all this, there is, however, something I want to repeat and emphasize. In the first place there has to be a strong body like the Competition Board, and one is grateful that this body is being strengthened and is being given a little more potency. In the second place, it is a fact that in the long run the Government has to take the responsible decision, and that decision has to be taken with due regard to all interests, whether they are those of an interest group or vested interests. A Government is nevertheless responsible for this. That is why I believe that with this board we are strengthening, and with a responsible government, we shall find that decisions will be taken and recommendations made that will be to the benefit of the country.

Mr. Speaker, the hon. member for Wellington has spoken about pressure groups and the role that pressure groups could or should—let me also add should not—play. I do believe that it is our duty, as parliamentarians, to consider the interests of all groups of people, and where certain industries, such as the wine growers’ industry, the sugar growers’ industry, or whatever, are at issue, I think it is our duty to look after those interests, bearing in mind the overall interests of the public as a whole. Heaven forbid that the day should ever come in this country when large pressure groups start dictating to this House and telling us what should happen, especially in the economy, as I believe happens in some countries in the world. I believe that when we consider any legislation, no matter which industry it concerns, it is very important that we continually have in the back of our minds the interests of the South African public as a whole. Only in this way will we pass legislation which will be right for South Africa as a whole and not just right for one particular industry or group.

I do not believe that the hon. the Minister should have any doubt in his mind that this particular Bill, the Maintenance and Promotion of Competition Amendment Bill, has the support of all parties in this House. It has been very clear in this debate and in other debates that hon. members of this House believe in the free enterprise system and that they are most concerned about inflation in South Africa. There is the generally accepted view that competition is essential to promote the free market system and that it is also essential in order to curb profiteering. For this reason every party in the House is supporting this measure.

I sincerely hope the hon. the Minister will bear in mind the question which the hon. member for Walmer asked as to whether the amount being budgeted for in the current budget for the Competition Board was sufficient for them to achieve the objectives which we would all like to see them achieve. I am sure the hon. the Minister will reply in that regard. I feel in this particular time of our economic development and history in South Africa this Act has an extremely important role to play. I should like the hon. the Minister to take the message to the officials in his department and also to the board members that Parliament is behind them one hundred per cent when it comes to ensuring that there is more competition in South Africa. We take pleasure in supporting this measure.

Mr. Speaker, it is once again my privilege to speak after the hon. member for Amanzimtoti, and as before it is once again my privilege today to congratulate him on what he said. To a large extent I agree with him even if it is beginning to worry me that I am agreeing with him so frequently at this state of the session.

Here we are dealing with legislation which has as a basic background a good institution. It is an institution which was established a short while ago, in 1980, but which in its brief existence, as a result of the legislation on the Statute Book, has shown that specialized institutions of this kind can lead to the hon. the Minister making very good use of this expertise at his disposal. If one considers the good work that has already been done, it is no wonder that the hon. the Minister has seen fit to increase the number of members of this board and to facilitate its operation. I think this has become necessary. In the years which lie ahead it will be necessary, as other hon. members have already said, for this board to be given greater potency in order to be able to do its work effectively. I believe it will eventually stand out like a beacon in the economic world, and the public of South Africa will be able to rest assured that as long as this legislation and this board exists there will be fair comptetition at all times and that this board will be able to serve as a watchdog for the public and be relied on to take action when any restrictive competition in connection with monoplies raises its head in South Africa.

Increasing the number of members of the board is a good thing. The amendment is being effected as a result of problems which cropped up in the past. A year or two ago we had the case that the hon. the Minister experienced problems in connection with the publication of the report of the Competition Board. This amendment is now going to make it easier for the hon. the Minister to deal with this matter. The same applies to the operations of the board itself. All these amendments will contribute not only to facilitating the work of the hon. the Minister, but also co-operation with the board itself, and this will lead to a better service to the public. For that reason it gives me pleasure to support this legislation.

Mr. Speaker, I want to thank all hon. members for their participation and support. There is no doubt that the Competition Board has a very important function within a free enterprise system and that since it is the policy of the Government to allow market forces to play their role in South Africa to an increasing extent, it is equally essential to enable the Competition Board to carry out its functions as well as possible.

The hon. member for Vasco referred to the fact that we have gained experience during the past few years and that this legislation is aimed at further streamlining the activities of the board, thus enabling the board to carry out its functions better, to bring restrictive practices to light and to promote competition in South Africa. In my Second Reading speech I pointed out that we in South Africa had to contend with certain structural problems. The board cannot solve these problems but it can give careful attention to the behaviour or participants in the market, the behaviour of companies within a free enterprise system.

It is not always easy to acquire the services of board members who are independent and objective enough and who above all have sufficient knowledge to do this difficult and demanding work. We are grateful for the work done by board members and because the legislation also makes provision for the enlarging of the board, we shall probably have to try to recruit people who are capable of taking on these responsibilities. It is not so easy to acquire the services of people who can dissociate themselves from the interests that are at stake and reach a decision in the best interests of the public.

†The hon. member for Walmer referred to the lack of funds. Yes, Sir we certainly can do with more funds. However, we have also to adhere to the policy of the Government in regard to strict financial discipline and we have to put the limited funds that we have available to us to the best possible use. Even with the shortage of funds that we are experiencing I believe that the board is functioning very well indeed. As far as the staff shortages are concerned, we have of course to compete with the private sector for competent and qualified people in a market in which the private sector is also very active. Nevertheless, the board has done remarkably well. We are aware of difficulties and problems in regard to staff shortages and the Director-General and I are giving attention to this matter.

*The hon. member for Langlaagte referred to the importance of the activities of the board, in a situation where cartels can exist as well. Of course, the hon. members know that a cartel is illegal and that where the board does find evidence of the existence of a cartel, there are ways in which that cartel may be declared an illegal practice.

In his Second Reading speech the hon. member also referred to certain industries and this afternoon he again referred to coal. I want to draw the hon. member’s attention to the fact that as far as coal is concerned, the board is at present engaged in an investigation into the distribution of coal, and that the dynamite industry to which the hon. member referred in a previous speech has already been investigated. In this connection the board has made recommendations which have been accepted by the Cabinet and which have already been implemented. Consequently, the industry is now open to new entrants.

The hon. member for Wellington emphasized that in the final analysis the responsibility lies with the Government to take decisions and that the Government also has to deal with a variety of interest groups and other considerations which frequently cannot be taken into consideration by the board.

†I thank the hon. member for Amanzimtoti. I agree with him that competition is certainly necessary in a free market economy. We hope to give the board more muscle and, if necessary, I shall come back to this House to improve the legislation further so as to enable the board to do this very important work in the best possible manner.

With these few words, Sir, I want to thank hon. members once again for their support for this legislation.

Question agreed to.

Bill read a Third Time.

Mr. Speaker, I move—

The measures taken by the Government to meet the housing needs of our growing population are well-known to hon. members. Housing utility companies can play an important role in providing more homes, and the Department of Community Development has recently been taking the initiative in promoting the establishment of such companies.

The Housing Act, 1966, provides for a utility company to obtain funds from the National Housing Fund for the building of approved dwellings, but this must be done through the agency of a local authority. It has become necessary to extend this arrangement so that housing utility companies may apply directly to the National Housing Commission for loans from the Housing Fund. Therefore the Bill provides that a housing utility company qualifies for a loan from the Housing Fund if it is registered with the Department of Community Development.

It is logical that a housing utility company which makes a dwelling available to a buyer at a reasonable price cannot allow that buyer to sell the dwelling at a big profit within a short period. For this reason, housing utility companies will impose restrictions in the form of a pre-emptive right on dwellings sold by them. However, we are faced with the situation that if the housing utility company does not exercise its pre-emptive right—it may have good reasons for being unwilling or unable to do so—that buyer is then entitled to sell the property and to pocket the profit. A better arrangement would be, therefore, to allow the buyer, if the housing utility company turns down the offer, to sell the property on condition that a portion of the selling price be ceded to the housing utility company. What the portion should be that should be ceded is a matter for the housing utility company concerned. What is important, however, is that the buyer should know, at the time of buying the property from the housing utility company, what he is letting himself in for, and what the position will be if he wishes to sell the dwelling at any time before the expiry of the proposed ten years after the sale. These implications will be spelt out in the contract of purchase and sale entered into with the utility company.

†I now wish to pass on to another important aspect which is dealt with in this Bill, namely the extension of the period of the pre-emptive right of the National Housing Commission and local authorities. At present the pre-emptive right period is only five years, where after the owner may dispose of the property at will. A person who has obtained a dwelling with the assistance of the National Housing Commission is in a privileged position because the rate of interest at which the loan is repaid, being lower than the market rate, has enabled him to afford a home of his own. The existing pre-emptive right is aimed at discouraging speculation, but this measure has been found to have certain shortcomings. In order to be effective the pre-emptive right must be exercised in each and every case where it is evident that a buyer wishes to dispose of a property without good reason.

Available funds, however, are not sufficient to allow the Housing Commission or a local authority to exercise its pre-emptive right in such instances. A far better arrangement would be to extend the pre-emptive right period from five years to ten years and to provide that a portion of the amount for which the dwelling is sold be paid to the authority concerned in cases where the preemptive right is not exercised.

Hon. members will have noticed that it is intended that the portion of the selling price to be paid to the authorities be determined with due regard to any principles prescribed by regulation. Consideration has already been given to the formulation of regulations, and the consensus of opinion is that a sliding scale offers the best solution. In this way it will be possible to reduce the amount payable annually by a fixed percentage so that at the expiration of 10 years the seller will be allowed to retain the full selling price. Factors such as improvements made to the property by the owner will, however, be taken into consideration so as not to burden the seller unreasonably.

*A final aspect which is dealt with in the Bill is the question of delegation. The United Municipal Executive of South Africa has made representations to the effect that local authorities should be authorized to delegate powers relating to the administration of housing schemes to officials in the service of such a local authority or to management committees established for Coloureds and Indians. This is mainly concerned with the elimination of red tape with regard to the letting and selling of properties, so that matters may be finalized more easily and expeditiously.

Mr. Speaker, right at the beginning of his speech the hon. the Minister indicated that this Bill is one of the steps which is being taken by the authorities to meet the housing needs of the growing population in South Africa. The Bill, therefore, has to be seen against the background of the current housing need in South Africa.

†For many people this “behoefte aan be-huising” is a housing crisis. It is a crisis which, as the hon. the Minister knows, is affecting almost all sections of the population. Amongst the Black population in and around our cities there are, as the hon. the Minister knows, hundreds of thousands who are either not housed at all or who are housed in totally inadequate conditions. We also know that, in spite of the considerable building programme to meet the backlog in housing for Coloureds and Indians in our cities in recent years, there are still thousands of these people either sharing homes with other families or shacking up in backyards while remaining year after year on the housing waiting lists of local authorities or of the Department of Community Development. As the hon. the Minister knows—utility companies are already working in this field—for the first time in decades many thousands of White South Africans, who in the past felt secure when it came to housing, are now facing what is a very personal housing crisis.

It is against this background that one finds in the cities that tenants are worrying about how they are going to pay their steeply rising rentals and what will happen to them when they cannot pay any longer. People with families are struggling to meet increases in rates and taxes, maintenance costs and interest on redemption payments on the mortgage bonds on their homes. Young couples—this is particularly relevant to this Bill—are wondering how they will ever be able to own homes of their own.

When considering this Bill, one has to ask oneself what has gone wrong, who is most affected and whether this measure proposed by the hon. the Minister can help to put matters right. Looking at the housing crisis confronting the White people in the cities, one sees that it is not so much that housing is not available but that housing is only available at prices which the average South African citizen living in our cities cannot afford. There has been a shift from a crisis of availability primarily to a crisis of affordability. Recent surveys done by prominent property economists have shown that housing costs in the cities of South Africa are such that housing is now beyond the reach of by far the majority of White people living in the cities. The report indicates that it is estimated that in a city like Pretoria over 65% of the White people living there cannot afford to buy a house which costs R40 000. There are very few houses available in Pretoria, at a figure of less than R40 000, including the land. It has been shown that of the economically active population of the country, of some 606 980 Whites, 71% cannot afford the down payment and the subsequent repayment of interest and redemption that is required on a R40 000 house. Yet, if one looks at the main cities in South Africa, one finds that the selling prices of houses during 1982 averaged about R56 000. Therefore there is a problem of people not having the available part of their income to meet the housing costs, costs that are continually rising in South Africa. What are the reasons for this and how can a housing utility company help in this field? The simple fact is that the cost of housing—made up of the cost of land, the cost of services, the cost of building, the cost of finance charges plus the market factors caused by the supply and demand—has raced way ahead of the income that the average city South African has available to spend on housing. So the cost factor has been pushing the cost of housing beyond the available income of the individual South African.

On the other side of the scale we find that inflation has been eating away at the value of the savings and at the buying power of the rand at an alarming rate. At the current rate at which the Government is allowing inflation to continue, i.e. at an average of 14% per annum, the value of the savings and the buying power of the individual South African are being halved every five years. The R1 000 that the hon. the Minister saves this year will be worth R500 in five years’ time, and in ten years’ time it will be worth only R250. One must then relate the inflation factor to the cost of housing and to how a housing utility company may be able to assist. To make matters worse, while inflation is rising at an average rate of about 14% per annum the cost of building is rising at an even greater rate. In fact, over the last five years, according to the Bureau for Economic Research, it has risen by over 70%. This means that a house that cost R30 000 five years ago—and that was a modest enough house for the average citizen living in the cities—today costs R51 000. In another five years’ time it will cost R87 000, in ten years’ time R147 000 and in 15 years’ time that same R30 000 house will cost R263 000.

One must ask the question: In this position who is being the hardest hit by the staggering rise in the cost of housing? First of all, it is the retired person who does not own a house of his own, but who lives in rented accommodation and whose income is static. This means that because of inflation that person’s real income is declining each year while, at the same time, he is living in accommodation where the rental is rising. As the hon. the Minister and his deputy will know, one receives literally dozens of letters each week here in the Cape Peninsula, letters telling the heart-rending story of older people who can no longer afford to pay the rent for their accommodation in which they have normally lived. The second group of people whom we have to think of in relation to this Bill are the young married people, people who want to buy or build their first home. These people find that with prices rocketing sky-high, they cannot afford the initial deposit or otherwise they cannot afford to pay the interest and redemption charges if they are lucky enough to get a bond. That is the second category of people to be catered for. The third category is the ordinary family man who is finding it increasingly difficult to maintain reasonable standards of living and accommodation for himself and his family.

What then can be done, and does this Bill really help? First of all, this Bill does not deal, of course, with the question of inflation. Perhaps the hon. the Minister should talk with the hon. the Minster of Finance. We hold him responsible for financial and fiscal policy. We expect him to devise a policy which will peg the cost of living, and which will also reduce the rate of inflation. Secondly we have to establish whether this measure could reduce the cost of housing units. I will deal with this in a minute. The third thing is to establish whether it is going to increase the supply of housing for the middle and the lower income groups so that prices will not be pushed up further because of the fact that demand has outstripped the supply. I will leave the question of inflation to the hon. the Ministers and deal with the questions of the cost of housing and the supply of housing.

There is no doubt that utility companies have already shown—because there are already utility companies in South Africa—that they can make contributions to bringing houses onto the market at a cost related figure rather than at a market related figure. Utility companies have therefore a role to play in trying to reduce the cost of housing by a degree of efficiency and by employing other methods which I shall mention in a moment. What is tremendously important—and that is one matter about this Bill that concerns us to an extent—is that a utility company is only going to be able to reduce the cost of housing if it is properly managed, properly directed, if it has the right degree of enthusiasm, if it is given the right incentives and if it has the appropriate money. Unless it has the proper management factor added to it, it will of course not reduce the cost of housing, although we would hope—from the experience of utility companies in the past—that it will be able to do so.

We believe that this Bill is a positive measure. The hon. the Minister did not concede this in his Second Reading speech but he will know that this is in fact what we on this side of the House have been asking for the last few years—the development of utility companies as part of the way of overcoming the housing problems in South Africa.

In the first instance there has already been experience of utility companies; not under this Act, but utility companies, registered in terms of the Companies Act as companies not for profit or for gain. Of course the most celebrated illustration of a housing utility company has been Garden Cities. Garden Cities which was founded by Mr. Stuttaford and by Parliament way back in 1921, laid the foundation of Pinelands Garden City and after that of Meadowridge, Egdemead and others, and has become a pioneer in middle to lower income group housing in South Africa. It has also made a tremendous contribution not only to housing in the Cape Peninsula but to housing in general and to the philosophy of housing throughout South Africa.

Also in the Cape Peninsula, Mr. Speaker, we have the Citizens Utility Housing League which was formed during the depression years. It concerns itself with the lower levels of the middle income group. It played a tremendous role in the Cape Peninsula in providing housing for those people who had come from the platteland to the urban areas—White people in the main—but who did not have accommodation; who had very low incomes and were undergoing the first processes of urbanization. The Utility Housing League played its role in the lower income groups.

More recently one had the illustration of the Uluntu Housing Company, which has been created through the Urban Foundation and through private institutions, and which has tackled the question of Black housing. This organization has been building the alternative homes for those people living at Crossroads. So, one has an historical illustration of how for White middleclass and White lowerclass income groups, as well as for Black people, utility corporations have already started to play a role in South Africa. I do believe, however, that utility corporations, and especially now with the assistance of this legislation, have a special area in which they can contribute.

I have no doubt that housing utility corporations can assist the first time homeowner and that this should be one of its prime objectives—the aiding of the first time homeowner. Secondly, families with young children are also the kind of people that can be assisted. Thirdly, retired people living on relatively fixed incomes can also be assisted because I believe that we should use these utility companies to develop the concept of retirement villages, specially designed and managed in the interest of senior citizens. Quite clearly, there is a tremendous role for utility housing companies to play in self-help schemes for the poorest of the poor in and around our cities. So one asks: In what way can they assist in reducing costs?

Quite clearly, one of the prime cost factors in housing is the cost of land, and by purchasing land early, by purchasing ahead of the appreciation in the value of the land, they can peg the price of the land to the people who are, in the end, going to purchase that land from them. Secondly, because the utility company itself will gain from the capital appreciation of commercial sites in its townships, this capital gain obtained from commercial sites can be used to reduce the unit-cost of the residential plots made available to purchasers. Quite clearly land can be obtained through advance buying, costs can be pegged and use can be made of capital gains. Then, when it comes to land, services and buildings, they can go in for more cost-effective design because they will be working in bulk. They can also go in for integrated planning of land, services and houses, rather than the extravagant approach of land separated from services and housing or services and land separated from housing. They can also see to it that there is a continuity of expertise and personnel available, because they are not subject to the market influences or the market cycles, the rising and falling in the intensity of building activity. There can be an ongoing, regular pattern of building of housing and township development. Especially when the utility corporations can get Government money, utility companie’s activities will not have to vary in accordance with the availability or non-availability of private finance. Finally, it is quite clear that they should be able to reduce the cost of services and building by bulk-buying and bulk-installation.

If this Bill goes through, they will also be helped in what is perhaps the most critical field today, and that is the monetary field. Money has become a tremendously expensive item. Over the last few years interest rates have risen from between 7% and 81% to a level of 14% through to 17%. By getting loans through the department or through the Government at favourable interest rates—and we hope favourable terms of repayment—these utility corporations can most certainly assist in reducing the cost of housing to the ordinary, average city dweller in South Africa.

Having said all this, and having indicated that we will support this measure, let me tell the hon. the Minister that he must understand if we raise one or two matters in connection with the Bill which, if they do not hold dangers as such, nevertheless do cause us to have certain doubts which we want to put to the hon. the Minister at this early stage.

We all say that we believe in private enterprise. We all say that we believe in the profit motive. I believe that there is nothing to be ashamed of in either the profit motive or private enterprise. What the hon. the Minister must realize, however, is that in this particular Bill he is deliberately excluding the profit motive. The profit motive disappears in respect of the type of corporation mentioned in this Bill, and there is always a risk attached to this, because the profit motive is the critical test of efficiency. Take away the profit motive and one runs the risk of inefficiency which no one will never notice or find out about, because when all is said and done, it is a question of a balance sheet at the end of the year which shows whether a business has been effectively run or not. So whilst we think that there is a case to be made out for eliminating the profit motive in this field …

Not totally. Profits must be ploughed back.

They are not declared profits. There is no Geiger counter that can indicate whether one has made a profit or has suffered a loss. It is all hidden.

There is a surplus. So what is the difference?

There is not the same test of efficiency as there would be in an ordinary private, profit-motive company. We are not saying that one should not, for this reason, support the Bill. All I want to say is that one must guard against the feeling that one can eliminate the profit motive and still necessarily have as efficient a company. That is the first consideration.

You cannot have it both ways.

I realize that, but I believe that this is a point we should raise, because perhaps there is insufficient provision for supervision. I will be coming to that in a moment. The second point is that public funds are going to be put at greater risk than they are at present. These funds can be called back under section 16 of the Housing Act. However, it could be that they are not there to be called back. It could well be that an inefficiently run housing corporation without the proper calibre of directors or management could run at a loss. It is not the first time that people in the property business have burnt their fingers. All we want to say is that public funds are put at a greater risk, and the hon. the Minister will have to monitor, in the interest of the operation of this Bill, to see whether in fact the risk is perhaps not too great.

When money lent to a local authority is called back and the money is not available and the local authority cannot pay it back, then the Housing Commission in terms of the existing Act can levy a rate on property in that local authority area. In other words, if a local authority does not discharge its debts, then all the residents within that local authority area are responsible for meeting that debt because the Housing Commission can impose a levy rate on that local authority. However, no provision is made in this Bill for the levying of a rate on a housing utility company or on the people in the housing utility company area if they cannot pay back money which has been loaned by the State.

I now come to the third point.

Section 17 of the Act contains a specific provision regarding the control of schemes. Before a local authority may borrow money it has to submit its particular scheme to the National Housing Commission, who will then lay down the conditions under which that scheme can be proceeded with. The local authority then has continually to report back to the National Housing Commission and prove to the National Housing Commission that it is continuing with that scheme for the particular category and income group of people concerned. As far as this Bill is concerned there is no provision for control. These utility corporations are not required to subject themselves to section 17, which deals with the control of schemes.

I raise these matters because in the main I believe we are an overcontrolled society. I believe that in spite of the risks that there are it will be better in the initial stages to give utility corporations some free rein. One should, with a minimum amount of Government interference, allow them to get on with the job and to make a positive contribution. At the same time I do not think that we can ignore the fact that money lent to the National Housing Commission or to local authorities is strictly controlled. Money lent to these corporations is going to be under virtually no control at all or under very flimsy control.

I want to refer to a couple of clauses in the Bill to draw the hon. the Minister’s attention to this. Clause 1 reads—

I take it this means that they cannot hand out cash to the benefit of the members but that they can apply the advantage which may accrue to the members of that society in the form of lower costs and lower housing rates.

When it comes to housing utility companies, there is no specific control. They have to be registered, but there is no sanction once they are registered. Secondly, the loans can be given to them and the conditions of the advance of the loans are stated in subsection (3). However, once again there is no specific provision for control over the actual operation of those corporations. Security for repayment shall be the same as for the local authorities, in terms of section 16 of the Act.

Finally, in terms of subsection (7) a housing utility company is to supply its balance sheet and statements at the end of each year, and the Director-General may ask for any such further information as he may require. While information may pass backwards and forwards I think the hon. the Minister is aware that there is really no action which the Director-General can take other than to ask for more information or to strike a company off the roll of housing utility companies. It is good to allow as much free rein as possible but there must also be a minimum amount of control.

I want to deal with the final aspect of this Bill which was referred to in some length by the hon. the Minister. It is clear that it is not the intention of this legislature, nor should it be, that once State funds are loaned at low interest rates people can then speculate with that money which they received from the State. We are ad idem with the Minister, that some provision should be made to see to it that they do not speculate. At the moment individuals who get loans from the National Housing Commission under section 21 have to offer the property concerned back to the Housing Commission if they want to alienate it and if they get loans from a local authority they have to offer it back to the local authority. Now in terms of the proposed new section 17A if they get a loan from a utility corporation and want to alienate the property they have to offer it to that utility corporation. We agree with that. In the past the period during which a property had to be offered back was five years. We do not know whether it should be five or ten years. We wonder whether from experience of the past the hon. the Minister has found that five years is too short a period. We would not lightly want to extend the period to ten years, unless experience has shown that a period of five years is inadequate. However, if in the experience of the hon. the Minister and his Department five years have proved to be too short a period, we are quite happy that that period be extended to ten years. If ten years seem too long, perhaps those of us who will still be here in ten years’ time, can change it back to five years. We have no strong views on this, but we would like to know what the experience of the hon. the Minister and his Department has been in the past.

Finally, on the question of offering back, as the hon. the Minister has indicated, you have two options at present. You can offer it back at a price to be negotiated and if that is not possible the price is determined by arbitration on the principles contained in regulations and the local authority or the National Housing Commission can then buy it back. If they do not do so you are absolutely free to do with it what you like. We hope it is the Government’s intention in the main that houses should not be bought back because the whole intention is to use public funds to get houses into the market and not to buy them back into the public sector.

We seldom buy them.

Yes, but if you do not buy them, the owner retains hundred percent of the profit. In other words, the Housing Commission either buys it and takes all the profit or it does not buy it and all the profit goes to the individual. I think there should be a halfway stage so that, if the housing utility company does not exercise its option, the individual should be able to sell it. However, the housing utility company should get a reasonable share of the profit that is available. We have no objection to that concept. We think it is correct. We also think that it should be extended in terms of the other clauses to local authorities and to individuals.

When you come to the third option, you no longer have an arbitration factor. As regards the first option, the price at which it was going to be purchased, was first negotiated and if you could not reach a negotiated price, it was done by arbitration on the basis of principles contained in regulations. When you come to the new option, the price will not be determined by negotiation but by the National Housing Commission. The Housing Commission will decide what the amount is going to be that the individual should pay back. It will be guided by the regulations. We have tried to get copies of the regulations because we do not know what they are. We do not know what the Government’s intention is. In view of the fact that there is not going to be arbitration with a neutral person deciding, would it not be more appropriate to set out in this legislation, the principles on which this extra amount is to be determined so that every man who is going to sell his house knows in advance what his position is and will not be dependent upon regulations which can be changed arbitrarily from time to time? Is there not a case, when it comes to this third option, for seeing that the portion which is due is determined by way of an Act of Parliament rather than by Ministerial or executive regulations. We believe that once this Bill is passed, it will enable housing utility companies to play a greater role in the provision of housing in South Africa. However, we do ask the hon. the Minister to consider the points of detail which we raised to see whether the Bill cannot be improved even further before it passes the Third Reading in this House.

Mr. Speaker, I just want to react briefly to a few points raised by the hon. member for Sea Point in his speech.

In the first place, the hon. member for Sea Point spoke of a housing crisis. I do not think we should regard it as a housing crisis. I think we should rather regard it as a housing need which exists. I have asked a question, No. 630, in this connection. Unfortunately I do not have time to quote the question and the reply to it, but it is clearly apparent from these, if one compares the census statistics regarding the number of White, Coloured and Asian families with the statistics regarding the number of dwelling units available to Whites, Coloureds and Asians—all these statistics are contained in the reply to that question—that although these are cold figures, there is no crisis. However, it is a question of the actual use of the existing dwelling units.

The hon. member for Sea Point also referred to the various groups that were experiencing serious problems as a result of the shortage of housing. I must agree with the hon. member on that. On the other hand, however, one must not lose sight of the fact that the Government does have a housing policy, and if the Government is expected to meet all the housing needs, it will simply not be possible. That is why it is the policy of the Government that the provision of housing is primarily the responsibility of the individual. The hon. member for Sea Point referred to the problems experienced by the individual in meeting his own needs. I shall come back to that point later.

Furthermore, it is the policy of the Government that the employer also has a responsibility in respect of the provision of housing. I agree with the hon. member and I want to convey my appreciation this afternoon to those employers who scrupulously carry out their duty in this connection, whether by way of a subsidy or an allowance which is paid or by way of a guarantee. I appreciate what is being done by employers. However, I do believe that not all employers are doing their duty in this respect as they should.

In the third place, it is the responsibility of the State. I just want to deal with one point raised by the hon. member. The high cost of housing does play a role. We are all concerned about the high cost of land and of the services required. Something has to be done in that connection. On the other hand, however, we must not forget that the standards of houses that are being built and the standards of services are rather high, in my opinion. I think the time has come for many of our people to come down to earth a little. I think it is important that we Should also take cognizance of that aspect. The housing which is available at the moment is beyond the means of the people who need housing, and this is precisely because of the high standards. I also want to tell the hon. member for Sea Point that I think it is important—and I am referring to every hon. member of this House—to approach this legislation which is before the House this afternoon in the right spirit. If we adopt the right attitude in this connection, we shall also realize that this legislation which is before us is not the full reply, but that it is at least a step in the right direction to ensure that we shall be able to provide people with housing.

I think we should not lose sight of that.

The Bill is intended to make matters more attractive for housing companies. That is why it is important that we should take cognizance of the legislation. Housing companies have hitherto had to comply with certain requirements in terms of the Housing Act. The first requirement was that their scheme should be approved by the local authority. In the second place, the applicants for housing had to comply with the income limit. It is important that the legislation should provide that those requirements are not essential in the case of housing associations. I think this provision is universally welcomed.

There is the additional advantage that when housing is provided by housing associations, the income limit is dispensed with, with the result that it will be possible to cater for a certain middle income group as well. For many hears, it was not possible to cater for the people in this middle income group. I think there is a real need for provision to be made for those people as well. Housing societies will not necessarily have to liaise with local authorities in future, because they will have direct access to the department to apply for registration, in the first place, and, in the second place, to obtain the necessary funds.

I want to dwell for a moment on a few points contained in the Bill. The hon. member for Sea Point referred to pre-emptive conditions. However, that pre-emptive right is not a new principle. We are aware of the fact that we have exercised a pre-emptive right where necessary in the past. Where it used to be possible for a period of five years, it will be possible for a period of 10 years under this legislation. The main purpose of the pre-emptive right was to prevent speculation. In the light of the enormous increase in the prices of property, however, it was very often impossible for the local authorities and the National Housing Commission to exercise the pre-emptive right. The State is expected to make the property involved again at a reasonable price, but it has not been possible. That is why I welcome the new principle in the legislation that a portion of the profits made on the sale of a property within the period during which the pre-emptive right applies will accrue either to the housing association or to the National Housing Commission.

The hon. member for Sea Point objects to this, but I want to point out that taxpayers have complained over the years that some of the people who benefit from obtaining housing on such extremly reasonable terms are allowed to make a profit on top of that. I think the idea that a portion of the profit should be paid back is a good principle as contained in the legislation. Therefore I support it wholeheartedly. It is quite clear that the profit obtianed in this way should be ploughed back into the provision of housing, the making available of land or the provision of services for that land.

In any event, it still means that if anyone alienates his property after the period of 10 years has expired, all profits will accrue to him. This is an agreement which he signs the day he enters into the contract. So he is fully aware of the conditions of the contract which he is signing.

As regards the percentage of the profit which will be repayable, I support the idea that this should be laid down in the regulations. This would provide greater flexibility, which could greatly facilitate matters.

It is provided in the legislation that when people have improved their property, this will be taken into considertaion when that property is sold, with a view to ascertaining the profit. I agree with him that it may not be a popular principle that a portion of the profit is expected to be ploughed back, but I think it is no more than right.

I should like to raise a further point, namely the question of delegation. It is a fact that the various municipal associations, and later the United Municipal Executive as well, believed that it was necessary to delegate in order to expedite matters. I welcome this provision in terms of which it will now be possible to delegate, because in the case of local authorities, it sometimes took up to two months from the time an application was submitted until it was finally approved.

I should also like to mention the fact that specific provision is being made in the clause concerned for powers to be delegated to people of colour, i.e. Coloureds or Asians. I welcome this provision as well.

If one approaches this Bill with the right attitude, one can get excited about it. As far back as November 1981, the hon. the Prime Minister said at the Good Hope Conference that the Government would take the initiative in establishing housing associations. I think the decision contained in this legislation gives effect to what the hon. the Prime Minister said there.

I should like to take this opportunity this afternoon of conveying my sincerest appreciation to a few of the utility companies. “Utility companies” is what they are called. I prefer the term “housing associations”. I should like to mention two housing associations that have become involved in the provision of housing for the general public. I should like to focus attention on them this afternoon, because I think this is the course we should take in furture as well. Garden Cities was established in 1919. One Mr. Richard Stuttaford made an amount of £10 000 available at the time for the provision of housing, and approached the acting Prime Minister at the time with a view to the provision of land. That was the start of Garden Cities. Speaking of Garden Cities, I should like to point a finger, firstly at myself and then at some of my colleagues in this House, because there are two hon. members in this House, the hon. members for Tygervallei and Maitland, who are actively involved in Garden Cities and in the Urban Housing League, concerning which I also want to say a few words. If we regard it as our responsibility as representatives of the people to get actively involved in the provision of housing, we cannot fail to be successful and to find a solution to our problems.

I just want to point out that since its inception, Garden Cities has made 32 000 dwelling units available. I mention this as an example. If we continue along these lines, our efforts will certainly meet with success. In terms of its programme for the future, Garden Cities intends to erect 28 000 units. This process includes the planning, the provision of land and the eventual building of the units. Garden Cities has 2 500 applications for housing at the moment.

I also want to refer to the Urban Housing League. The Urban Housing League was born of dire necessity. I have here a document, published by the Urban Housing League and entitled “Vyftig Jaar Be-huisingsvoorsiening”. This is one of the groups that have really done pioneering work, especially here in the Western Cape, in respect of the provision of housing. In this publication one reads—

I read further—

A question is asked by a person from the ACVV who is making a study of housing here in Cape Town. The reply is given by a person in that house—

I wish to pay tribute to those people who really went out of their way to deal with a problem. I cannot omit to mention the ACVV in this connection. The ACW was the inspiration behind the founding of the league, and in 1925, a social worker of the ACVV submitted a report to the committee on the housing conditions in Salt River and Wpodstock. And that was the beginning. A public meeting was convened to which all persons and organizations were invited in order to draw attention to the need which existed at that time. I want to mention only two persons who were involved with the Urban Housing League in the earliest years. In the fist place I should like to refer to Bishop Lavis. Bishop Lavis was a member of the committee of the Urban Housing League. He was a bishop of the Anglican Church. When he died, the following was said about him by the person who conducted the service at his funeral—

I should just like to refer to another person, and that is Mrs. Zerilda Steyn. Mrs. Zerilda Steyn also served on the committee of the Housing League. One can never forget the work she did. The statement I want to make this afternoon is that we need more Bishop Lavises in our time and that we need more people like Dr. Zerilda Steyn to be able to deal with our housing problems.

I want to conclude by saying that in order to deal with the housing problem in the Republic of South Africa, we should in the first place adopt the right attitude. In the second place, it is important that we should set aside our political differences and that we should also set aside our differences with regard to our religious denominations. The same applies to language and cultural differences. What is also important is that we should even forget about colour so that we may tackle the problem of housing as a united community. Only then shall we be able to deal with the problem of housing in the Republic of South Africa.

Mr. Chairman, I want to thank the hon. member for Witbank very sincerely for his remarks, but I do want to tell him that one cannot solve any problems by going back to people like Bishop Lavis. In Bishop Lavis’s time people could live where they liked, as long as they had a roof over their heads. There were several people who attacked Bishop Lavis at the time, including the Government of the day, which said that Bishop Lavis had gone against the Government’s programme.

Where do you read that?

Really, Mr. Speaker, the hon. member for Maitland now wants to know where I read this. I have read it to him in this House on numerous occasions. However, it is no use reading something to an hon. member when he does not understand a word of it. [Interjections.]

One of the most important matters we are dealing with today is housing. The hon. the Minister is now attempting, by way of utility companies and legislation, to afford relief in the alarming situation which exists today with regard to housing as a whole. In Johannesburg and Pretoria, for example, there is a shortage of approximately 17 000 houses for Whites today. Of course, there is also a big shortage of accommodation for Coloureds and Indians. It is true, of course, that there is a poor utilization of housing in certain areas. I want to mention one such area to the hon. the Minister today.

I have made certain surveys, and I have found that in a place such as Range-Oord, for example, there are 68 large, beautiful flats, flats which were built for Indians, but Indians have shown no interest in occupying them for the last six months. I cannot say that that is a good scheme. In the light of the cost of the scheme, it appears to me that it is more or less a two-bedroomed flat which is available for R59 000. It is a very good neighbourhood, and I can truthfully say that dwelling units there are certainly not more expensive than they would be in comparable White residential areas. The area is situated near Benoni, approximately 15 minutes from the Johannesburg City centre, i.e. a good deal closer to Johannesburg than Lenasia.

Now it happens, of course, that in schemes of this nature there are sometimes people who try to build up a resistance to the schemes concerned. Every person is certainly entitled to show his resistance to an area in which he does not wish to live, especially if he is able to substantiate his standpoint. However, such people certainly do not have the right to drive other people out of those residential areas, and then to move in themselves and to occupy dwelling units in which they do not belong, or which they are prohibited by law from occupying. In any event, I suppose the hon. the Minister has taken cognizance of the fact that I have said that there are houses which are unoccupied. I know of 68 empty houses in which these people do not want to go and live.

We have been told recently that in Lenasia, too, there are houses standing empty. It does not occur on a large scale, but there are in fact dwelling houses standing empty there. We have even investigated the matter and found that there are indeed empty houses here and there. Therefore I ask the hon. the Minister to give attention to this.

I want to put it to the hon. the Minister that everything that can be done today in order to provide proper housing for people of all races and colours will be appreciated. After all, it has become impossible for almost any breadwinner in South Africa today to buy his own house, as a result of the cost structure. We are not blaming the hon. the Minister for this. That would be wrong. I think the cause is to be found in our handling of the total structure of our economy. I believe that the way in which we are handling our economy is the primary cause of the high cost of housing. In this respect I may refer, for example, to the high cost of cement and bricks. The new legislation regulating who is allowed to build a brick-kiln and who is allowed to manufacture bricks is a clear indication to us of the way in which we are creating a deadly weapon against ourselves. By means of our own legislation we are imposing so many restrictions upon ourselves that it is becoming almost impossible for us to be competitive. The so-called small brick manufacturer is no longer a part of our system, not because he cannot compete, but because the law no longer allows him to operate in certain areas. In certain areas he is not allowed to build a factory.

Here we are dealing with the important concept of the utility company today. All ideas are good ideas, of course, until they are tried in practice. Once they have been tried in practice, one sees that there are certain factors that have to be taken into account. The same applies in this case. It has been said that we should see to it that people do not make profits. I also have some experience of utility companies, and not only in South Africa. I went to study a section 21 company abroad. One only uses the profit for paying salaries; one pays for the land and it is used for fringe benefits for retired officials, etc. In the end it is a poor economic system which one has. However, we do not want to condemn the utility companies before they have started. Nevertheless, the hon. the Minister should realize that this is not really going to be a great success. I know one has to try it. I think the important thing in South Africa today is that we should build houses for people which they can afford, and not houses which they want or which they say they need. They should be houses which they can afford, which they can pay for, and this should be done at every level. This should be the criterion for each of our population groups. A person should be told that he can afford to pay a certain amount for a house, and that that is the kind of house to which he will be entitled.

We have only to look at the various house-building methods that are available to us today. However, those methods are outdated and have been for years. Just think of the question of township development. It is wrong to go on using the old method of township development. In Pietermaritzburg there is a method which is based on the subdivision of a farm, and a township can be established in six weeks. We have seen what has been done in the big city of Chicago, for example, with regard to the subdivision of portions of farms. Registration can take place. We have discussed this aspect on committees with several surveyors and other interested parties. They agree that one does not need the unnecessary, lengthy process of establishing a township, with all the advertisements and other lengthy procedures. There is the short method which is based on the subdivision of portions of farms.

This brings me to the question of services. The task of a Minister charged with housing in South Africa must be one of the most difficult ones imaginable, for on the one hand, no one is as critical as the man without a house, and on the other hand, no one wants more for his money than a man who is going to buy a house. And where else would one find so many people without houses as the people who have to be served by his department? For that reason it is always a major problem for the responsible Minister.

This brings me to the financing of housing. In financing any item, one finds that there is an established procedure for such financing. When one is taking up farming, one knows that the Land Bank will make certain loans available to one. When the Railways negotiate a loan, there is the realization that there will have to be a certain levy sooner or later. In the case of housing, however, we have never had any established form of financing. Therefore it is necessary—and I strongly urge today that this be done—that the Treasury should give attention to certain matters.

In South Africa, the biggest item of expenditure is probably the services required for a house. Services account for 40% to 50% of the total cost of an average house today. Is it necessary for someone who is buying a house to put down a lump sum in cash for the services that are going to be used in that house for 40 or 50 years? The average cost of services today is approximately R12 000 to R14 000 a house. I am in favour of imposing a small levy of, say, R5 a month, instead of R12 000 having to be paid in cash by the buyer. The city council can raise a 20 or 30-year loan with the treasurer and the buyer can pay back the loan in the form of a levy. It is a service levy. If this were done, the cost of an average house would immediately be reduced by R10 000 to R15 000.

Hon. members may say that there is no precedent for this. But that is not so. Between 1938 and 1962, this was the way in which all housing in South Africa was financed. It was just not known under that name. A city council raised a loan, and by means of the levy normally paid for services, the cost of the services was paid off over a period of 30 years. I therefore advocate a return to that system.

This levy should never be seen as something extra. At the moment one is paying RIO 000, R12 000 and even R15 000 for services. The month a person starts paying for services, he starts paying rates as well. Those rates include a levy for the conversion of the term into 20 or 15 years, depending on the requirements of the various municipalities. However, there is no need for the present owners of a house to pay those rates. There is no need for everything to be paid at once.

I am not altogether in favour of the requirement that a person who buys a house and who sells it at a profit five or ten years later should give back the profit. In this way, the hon. the Minister will probably ensure that 5% or 7% of the people who buy a house do not sell it again. One finds, however, that home-owners generally do not live in one house for more than seven years. The statistics will confirm this. An ordinary home-owner does not live in the same house for more than seven years. And when he sells the house, he never buys an inferiour house; he buys a better one. He then buys a house which he can afford. Over a period of 10 years, a house will certainly show some capital growth. The owner has tiled certain areas, perhaps, he has put on a new roof, or he has made other changes. When one says that the board has a pre-emptive right on the house, I believe the hon. the Minister will say that the State will compensate the homeowner for the improvements he has made. Nevertheless, I am afraid that one may be destroying the initiative of those who have the least initiative to begin with, namely those people who are not buying because they really want to. These are the people who have to be gently pushed into the water before they will swim. They have to be encouraged before they will really begin to be economically active people. It is very important in our country today that we should renew old areas. I find it frightening today to visit the old part of Jeppe. There are old blocks of flats which have been partially demolished and neglected and which can be repaired so that persons can be resettled in their own community within six weeks to eight months. During our visit to Wales and Scotland, we saw that this was of great benefit to the community, because those people got to know one another and may even care for one another in their old age. Structurally, most of those buildings were built to last 100 to 200 years. Therefore I ask the hon. the Minister to consider this aspect as well.

I must honestly tell the hon. the Minister that the attempts that are being made by him and his department are commendable. We cannot get away from the fact that under his leadership, this department has made a impressive attempt to provide more housing. Since the hon. the Minister is sitting on the wrong side of the House, I cannot agree with everything. As far as the provision of housing is concerned, however, I want to tell him that we cannot fail to appreciate what he and his department are doing. I also want to tell him this today: Emergencies sometimes arise, and in Johannesburg people sometimes phone one seven times a day in an attempt to obtain a house. Then one goes to the department and one always gets a kind answer and humane treatment from them. I want to thank the hon. the Minister and his department today for that approach. Where there are shortages which cannot be removed overnight, I ask him to understand that when we approach him with a case, we are dealing with a voter who finds himself in a serious predicament.

Mr. Speaker, I have listened with great interest to the hon. member for Langlaagte and I know he has a lot of experience in the field of housing. He also serves on a commission which deals with housing and I think the hon. the Minister has taken proper notice of what he has said. It seems to me that we are not only facing a political crisis, but also a drought crisis because of the shortage of water. I do not know which is the worst of all the crises which we are facing, but the crisis we are facing right now is the shortage of housing. There can be nothing worse in a country when there is not adequate housing for the people of that country. We are in fact in that position at the moment. In reply to a question the hon. the Minister stated that there was a shortage of 160 000 units in the country today. One must compare that with the total of 33 892 units that were provided by the department in 1982. In answer to a further question, the hon. the Minister informed me that the private sector had provided only 27 248 residential units excluding flats and this meant that we were still faced with a tremendous shortage of something like a 100 000 units at the moment. This was at the end of 1982. We are now well into 1983 so the figure in this regard has probably changed but we do not seem to be treating this shortage in a way which is sufficiently meaningful in order to eliminate that shortage and overcome the crisis in this regard. I think everyone will agree that housing provides some degree of permanence and stability. It also provides security and peace by giving people a stake in the country and ensures a stable middle class of people.

I think the hon. the Minister will agree with me when I say that there are two essential facts in regard to housing that have to be considered. Firstly, there has to be adequate housing for all population groups and secondly, time is of the essence. The sooner adequate housing can be provided the sooner will we be able to experience greater peace and stability in this country. One has to ask oneself when we talk about a crisis in housing what happened just after the last war during which towns and cities were bombed absolutely flat. We can think of places like Hamburg and Rotterdam and even of cities in England. The people there has no housing at all. What did they do? Did they set about building houses in a paltry fashion by building a few here and there? People were looking for accommodation. They had a crisis and they had to meet it. What did they do? They went in for mass housing schemes. They provided something like 500 000 units a year in each of those countries. This was done in West Germany, Belgium, Holland and the United Kingdom. As I say, these countries embarked on massive schemes. They went in for a prefrabricated type of home. They had some 400 different methods of preconstruction in regard to building in Europe and the United Kingdom. Where certain local authorities were separate from each other but contiguous, they got together and put schemes into operation. A number of these schemes to which I have referred required a minimum number to be built in order to make the scheme viable. If that number was provided, there was viability. These authorities got together and shared the scheme. What is to stop our doing this on the Witwatersrand where we have local authorities cheek by jowl with each other? Why cannot they get together and launch these massive housing schemes to provide housing for all the people who require this accommodation? That will be tackling the problem in a meaningful way. The hon. the Minister has stated that it is more the policy of his department now to call upon the private sector to do its share in this regard while the department concentrates on the infrastructure. It is in line with that policy that we have this Bill before us today. However, when we look at the budget of the department we find that an amount of only R363 million has been provided for housing for Whites, Coloureds, Indians and Blacks. When we look at the figure for last year, we find that it was R30 million less. That is not meaningful.

That is not the whole story.

Unless the hon. the Minister comes to grips with this problem in consultation with the hon. the Minister of Finance and unless the Government accepts its responsibility in this regard in order to provide meaningful solutions to this problem, we shall simply be playing with the problem. In a crisis of this nature all sections of the population suffer, and the Blacks more than anybody else. The Coloureds and Indians are also suffering, as are the Whites. The young, the middle aged and the aged are also suffering, and to add to the problem we have the tremendous escalation in prices that has taken place over the past while. The escalation in price in regard to certain flats that has taken place over the past eight months or so has been something like R5 000 per month. These are the prices which people are being forced to pay because of the lack of accommodation and because of the many immigrants coming into the country and requiring accommodation. As I say, we are facing a general crisis in this regard and we are not doing anything meaningful and doing it speedily enough to meet this crisis.

Having said that, I hope that the Bill before us will meet the shortage as it is proposed to do. We therefore welcome it as the hon. member for Sea Point has already indicated.

What we are aiming at in terms of the Bill, is to allow utility companies who up to now have worked only through local authorities and have obtained loans through local authorities, direct access to the National Housing Commission. We are encouraging the establishing of utility companies so that they can fulful a role in providing housing. I do not know whether the hon. the Minister knows the answer, but I should like to ask him how many utility companies are operating in South Africa. The hon. member for Sea Point mentioned a few, but I am aware of only one or possibly two which have operated in the Johannesburg area. I could be wrong, however, I know that one was established many, many years ago in South Hills. They built a large scheme there, but I think the local authority eventually took it over.

How do we encourage people to start a utility company? How are we going to motivate people to do this? Whose responsibility will it be? Do we just walk out of the House saying: Well, we have passed the Bill and we hope members of the public will get together to establish utility companies? These utility companies are not established for the reason of making profits, but they have to involve themselves in administration. Usually the public do not subscribe to such companies in the sense that they take up shares. These are section 21 companies or they are limited by their articles of association as is mentioned in the Bill. If they do start on their own, who is going to provide their infrastructure? They need administrative staff, offices, telephones, stationery etc. I assume that if they apply for loans, they will be granted loans on the basis applicable to local authorities. Will they therefore have to apply to the National Housing Commission? They will in any event have to submit their schemes to the commission and they will have to explain what rentals they propose to charge. They must establish a township if such a township has not already been established. If their proposed rentals are approved and they meet with all the prescribed rules and regulations, they will be allowed to proceed. Are we going to get the utility companies to do all that?

I think there should be a proper campaign to get people interested in forming utility companies. I do not know what the hon. the Minister has in mind. We should like to encourage the establishing of such companies and if we can do anything to assist, we shall gladly do so in order to get people together to establish companies which can provide these schemes. It may also be possible for a number of utility companies to get together to provide such schemes jointly on a large scale. There can be schemes for the old, schemes for the young and so on.

Only the very wealthy can talk of houses above R100 000 and can afford to pick and choose to a certain extent in today’s market. Below them we have a number of professional people who look for houses of a cheaper nature; they have difficulty as well. What has the Government done to encourage these people to buy homes? The hon. the Minister of Finance said in his budget speech that he wanted to assist young people who wanted to buy a home, the price of which did not exceed R50 000 and in respect of which the bond did not exceed R40 000. He had this to say (Hansard, 1983, col. 4211)—

With great respect, how many people will be able to buy for R50 000 a new home or a home which has not been occupied before? He should rather have said that all the instalments that such a person paid on his bond would be deductible, and then we would have made some progress with regard to this category. Frankly, I do not think that his offer amounts to a row of beans. It is not going to encourage people to obtain housing on that basis.

Coming back to the question of the utility companies, which is the substance of what we are discussing here today, I want to say that one realizes of course that the greatest shortage of housing is amongst the Blacks, and then amongst the Coloureds, the Asians and the Whites, more or less in that order. The existing utility companies are for Whites, except for Uluntu, as mentioned by the hon. member for Sea Point. If a utility company is established, will that company be able to provide housing for all four population groups?

Of course.

So it will provide for all. I am asking these questions on behalf of the hon. member for Pietermaritzburg South, who unfortunately has to attend to a very important matter in Pietermaritzburg today. He is himself involved in the establishment of a utility company for the Pietermartizburg area.

Send him to my office. He can then get all the information he wants. You cannot now extract all of it from me in the House.

Well, I have some interesting points to make which I think are relevant to the question of the establishment of utility companies …

There is a manual available in any case.

Well, we would like a copy of those guidelines. One of the problems in regard to the establishment of a utility company to provide housing for Blacks is the question of land tenure. The question arises whether the required land is available and, if the utility company has established a housing scheme on a piece of land, whether that land will not be transferred to a homeland or an independent homeland and, if it should be transferred, whether there will be a compensation paid to the people concerned. This is the sort of problem one has. Proclamation No. 293 controls land tenure in Black areas. This has been under review since 1979. It would of course be very helpful if a final report on that could be obtained, although that does not concern this particular hon. Minister. I should also like a copy of the guidelines so that I can examine them to see whether they apply to all the companies including the companies for Blacks, Coloureds and Indians as the case may be.

Then I should like to know what mechanism the hon. the Minister envisages creating to overcome the problems that could arise when a housing utility company reduces its standards and they come into conflict with by-laws. I take it that the utility company would then have to comply with the by-laws as laid down by the local authority. Speaking of local authorities, I recollect that under the hon. the Minister’s predecessor we passed a Bill here calling upon the local authorities to report on a regular basis on any shortage of housing within their area of jurisdiction and details of any waiting-lists for housing to enable the department to monitor and keep their finger on the pulse of shortages in particular areas. In this way the department could also monitor whether the local authority was doing its job and was providing something meaningful to fill the gap and to provide the required housing or whether it was dragging its feet. I myself have a little experience in regard to the provision of housing by local authorities and I welcome that suggestion in that it would keep the local authorities on their toes in this regard.

At the same time I am also aware of the problems local authorities experience. In order to provide housing for Coloureds, Indians or Blacks, as they used to do before it was taken away from them, they had to get the land, and the land had to be proclaimed under the Group Areas Act, which is something that took years. When one was successful in getting it proclaimed for the Coloureds or the Indians as the case may be, one had to get the township established and it sometimes took five or six years before the township was established. When the township was established, one put forward the scheme. That went to the National Housing Commission who examined it; and that took a year or two. Then, after they had approved it, one could not go ahead with the scheme but one had to wait for the money to be voted. Only when the money has been voted, after the scheme has been approved, can one then go ahead with housing. Unless we are prepared to cut out all this red tape and unless we are prepared to get right down to the guts of the matter and attempt to shortcut all this we shall not solve the problem. Hopefully the commission that is sitting at the moment, of which the hon. member for Sea Point and other hon. members are members, will bring out a report fairly soon in order to cut across the red tape of township development and, although I do not think it is quite within their province, also obtain approval for schemes from the National Housing Commission. At one time in Johannesburg we had a special liaison committee under the chairmanship of the previous Director-General, Mr. Fouche, that used to meet one month in Pretoria and one month in Johannesburg. We used to get all the disciplines together, namely the Department of Planning, the provincial administration, the National Housing Commission, representatives of the Coloureds and representatives of the Indians. In fact that is how we built the Oriental Plaza in a short space of time. Unless one establishes agreement with all local authorities and regions, one is going to get bogged down with delays, etc. I think the time has come when we should in fact consider this.

I should now like to deal with one or two more details with regard to the Bill itself. These matters were touched upon by the hon. member for Sea Point. I have again looked very carefully at the hon. Minister’s Second Reading speech in so far as two points are concerned. Firstly, when a person has obtained a house either through the National Housing Commission, a local authority or a utility company and he wishes to sell within the period laid down, which was previously required to be ten years, he must first offer it back to the relevant local authority, utility company or the National Housing Commission. If they do not buy it, a portion of the profits the owner makes must be paid back to them. The reason advanced by the hon. the Minister in combining both those points is, firstly, and I quote—

We go along with that completely and we agree to the principle that there should be a brake on this sort of thing. Sometimes when a housing scheme is completed the houses are sold by public auction. Some speculator could come along and buy the whole lot. So I think we are ad idem on that. We do not want that sort of thing because we want to provide for people who will occupy those houses themselves. We do not want people coming along and making profits by ripping off people. Then the hon. the Minister says—

I do not know whether the question of “without good reason” comes into this matter. What can be a “bad” reason for him wanting to sell? He might want to sell because he has been transferred or because he wishes to move to another place.

If he is transferred the same applies.

All right. Then the hon. the Minister goes on to say—

I can understand that and I think we shall go along, too, with the idea that, rather than the local authority or the utility company using their funds to buy back houses all the time, they rather use those funds in order to promote the building of more new houses which can be made available to other people. So we support that principle. Then the hon. the Minister says—

He then goes on to say—

I have this difficulty and I trust the hon. the Minister, when he replies to this debate, will deal in far more detail with these two points that have been worrying us in this particular Bill, namely that we are combining the extension of the ten years with a proportionate amount that is to be paid to them. I think a purchaser has the right to know when he initially buys what the formula is and what is going to be involved.

It is in my speech; just read it.

I am looking at it. But you merely say that—

It must be stipulated in the contract.

That is right. What is the proportion, however? Is it 10% per annum?

Just carry on; I shall answer you when I reply to the debate. [Interjections.]

We should like to know what the hon. the Minister’s experience is in this regard, and whether what he proposes here is indeed based on experience. He must also tell us whether this measure is going to encourage people to purchase under the specified conditions, and also whether this is going to encourage the utility companies to go ahead with their schemes.

All in all, and in view of all the aspects I have mentioned, I believe that the main problem with which we are left is that of the establishment of the utility companies, the creation of the infrastructure for those utility companies, and the process of enabling those utility companies to carry out their task, otherwise there will be no incentives for the public whatsoever to become involved.

On the whole, Mr. Speaker, we welcome this measure and we will support it.

Mr. Speaker, I just want to react briefly to the speech made by the hon. member for Hillbrow. Of course, I do not wish to deprive the hon. the Minister of the pleasure of replying in full to the speech of the hon. member for Hillbrow. Therefore I shall confine myself to a single statement made by the hon. member. It is a remark which the hon. member for Hillbrow made early on in his speech, when he pointed out that this measure provided for the establishment of housing utility companies. Then, however, he asked almost in desperation where they were going to get the money, where they were going to get the technical aid, and who was going to help them to get off the ground. If the hon. member had made a thorough study of the legislation, of course, it would not have been necessary for him to ask these questions. Clause 2 of the Bill provides for the matters which the hon. member for Hillbrow finds so worrisome.

I have the same problem with the hon. member for Sea Point. As we have come to expect from him, the hon. member for Sea Point made a responsible and well-considered contribution on this measure. He spoke about the problems of the housing situation in South Africa. It was a good speech, but in one respect it was inadequate: he did not refer to the technical details contained in the measure itself.

By way of illustration, I want to refer the hon. member for Sea Point to certain aspects of it. He did not distinguish in his speech between a utility company which is registered in terms of the Companies Act and which has as its objective the promotion of housing, on the one hand, and a housing utility company registered with the Director General on the other hand. These are two fundamentally different entities, and both are active in the provision of housing. If we do not recognize and take cognizance of this basic distinction in the legislation, confusing questions are going to arise, as was in fact apparent from the speeches of the hon. member for Sea Point and of the hon. member for Langlaagte.

For the purposes of orderly debate, I believe, we should recapitulate the three basic principles contained in this measure. Let us see what those principles are. There are three of them.

The first principle concerns the statutory regulation of utility companies which are active in the field of the provision of housing. This is the first principle. The second principle we find in the pre-emptive provision. The third principle, according to clause 6, lies in the fact that certain powers can be delegated under certain circumstances. These are basically the principles embodied in this legislation. I wish to deal briefly with each of these principles.

Let us first consider housing utility companies. They play a very important role in the housing process in South Africa, so much so that at the Good Hope conference on 12 November 1981, the hon. the Prime Minister, in spelling out certain economic priorities, referred …

You had better forget about that. [Interjections.]

The hon. member for Langlaagte would acquire a great deal of knowledge if he would only sit still and listen to what emerged from this Good Hope plan. [Interjections.] The hon. the Prime Minister said—

Then he said, and this is very important—

Arising from the Good Hope conference we see, like a golden thread, the importance attached to utility companies. The hon. the Minister of Community Development said in his announcement of policy during the budget debate (par. 2.3)—

In other words, this whole question of housing utility companies has been integrated into the Government’s housing strategy. However, we must draw a clear distinction here. There are utility companies that are registered in terms of the Companies Act. They can be active in the field of housing in terms of that Act. In terms of the measure which is before the House, these utility companies can also apply to the Director General for registration. Then they become housing utility companies. In other words, the essence of the legislation which is before the House—this opens up new prospects with regard to housing—is that housing utility companies will share in the benefits provided under the Housing Act, Act No. 4 of 1966. This is the answer to the question of the hon. member for Hillbrow. It is also the answer to some of the questions asked by the hon. member for Langlaagte. What is happening now? Housing utility companies registered with the Director General enjoy the benefits spelt out in clause 2 of the Bill which is now before us. These housing utility companies can now obtain land and advances from the National Housing Commission. They can now obtain, not only loans and advances, but any other assistance which may be necessary to enable them to provide housing. We are laying the foundation here for housing utility companies to embark upon the provision of housing. Provision is now being made for housing utility companies to perform their housing function with the aid of National Housing Commission funds.

A very important technical distinction in this legislation is the fact that because housing utility companies are now being linked to the Housing Act, funds can now be appropriated for housing utility companies to provide housing for income categories which could not be catered for in the past. Section 19(l)(a) of the Housing Act provides that housing form the National Housing Fund can only be provided to persons with an income not exceeding R650 per month. The fact that housing utility companies will now have access to the National Housing Fund means that the income limit is not a factor and that housing can be provided for middle income and higher middle income groups. This means that they will not concentrate only on the housing needs of the lower and middle income groups, but that a housing springboard is being built in …

A trampoline.

Yes, a trampoline. A trampoline is being built in. That is a good description. A springboard is being built in for meeting the housing needs of those whose income exceeds the limit laid down in the Housing Act.

This is a very good measure and it forms part of the housing strategy of the Government to ensure that the main objective of housing, namely that the greatest possible percentage of the South African population should have access to a home of their own, can be achieved. This applies to White, Brown and Black. A house provides a certain degree of security and social stability. It is one of the principal aims of the housing strategy of this side of the House.

I also want to make a few remarks about the pre-emptive provision. The question may be asked why a pre-emptive right has to be embodied in the legislation. Hon. members should note that this pre-emptive right is only applicable to housing provided by the National Housing Fund. This formula is only applicable to those houses. Private housing companies can still formulate their own preemptive provisions. They are not subject to the provisions of this legislation. It is only applicable to the housing companies and to the local authorities and individuals that have obtained money from the National Housing Commission. And the question is: Why build in a pre-emptive right at all? It is being done, firstly, because the individual is sharing in capital which is subsidized and using it to obtain an asset which appreciates in value. Now the taxpayer can ask him, firstly, not to speculate with that built-in advantage and, secondly, to occupy the property himself. That is why a 10-year pre-emptive right has been built in which will be applied according to a sliding scale formula, as prescribed by regulation.

The position is, and it is very important that hon. members should take cognizance of this, that in the first place, this pre-emptive right can be exercised according to the sliding-scale formula, or, secondly, exemptions can be granted on an ad hoc basis. Utility companies very seldom exercise the pre-emptive right in practice, for when a person offers the company a house, the money is usually not available. A utility company does not have millions of rands available for exercising pre-emptive rights. Secondly, the owner may have made improvements and the value of the property may have increased. The purchase of such a dwelling may not be in line with the requirements of other applicants whose needs have to be satisfied. Therefore this 10-year arrangement with regard to the pre-emptive right is also flexible and adaptable so as to provide for the circumstances of every home-owner who has obtained funds from the National Housing Commission. These two principles, namely (a) the registration of utility companies with the Director-General as housing companies, and (b) the pre-emptive right, are a further outcome of the Good Hope Conference and are now being incorporated into the hon. the Minister’s housing policy to make housing accessible to all in South Africa in order to give everyone in South Africa, irrespective of colour, something to defend, something which he can claim as part of his investment in South Africa.

Mr. Speaker, I am not quite sure whether I should in fact declare an interest before I start, bearing in mind the debate in this House recently on the question whether if an hon. member is involved in some organization, he should declare his interest. I say I am not too sure, because I am not sure if it is an office of profit that I have here. Having appointed me as a member—or at least a nominated, elected … no, an invited member—of a public utility company, one of the first things they did was to ask me if I would privately guarantee the overdraft. [Interjections.] I think I had better make it clear that, whilst it may not be an office of profit, it could be an office of loss, and if I go bankrupt I would like Parliament to bail me out! [Interjections.]

Mr. Speaker, as has been rightly said by the hon. member for Bellville, the policy of the country is to get as many people as possible to be home-owners. And, of course, we in these benches fully subscribe to that philosophy. He also made it very clear in his speech that the main principles in the Bill were there to assist utility companies and also to ensure that people do not make profits out of housing benefits they gain as a result of buying from a utility company, the National Housing Commission, a local authority and so forth. Of course, we fully and completely concur. However, there are certain angles which have already been referred to by certain other hon. members in regard to which we also have some reservations. In particular, one wonders whether it is really necessary to make the pre-emptive period as long as ten years—this was also referred to by other hon. members—and if the experience gained has been such as to justify its being fixed for such a long time. There is also the question of the system whereby the person who bought the house has to make a contribution to the utility company, the National Housing Commission or local authority, as the case may be, should he sell during the pre-emptive period. I am not sure which hon. member it was who said it but I agree with him that when a person buys a property, I believe it is only fair, right and proper that he should know what he is letting himself in for and what commitments he is likely to be responsible for should he sell. I am well aware of the fact that the hon. the Minister has some formula or other that he will follow, according to his speech, but I cannot help feeling that that is not really the answer to the problem. There may well be circumstances in which a person has to leave. Because his workplace changes he has to move to another area where he has to pay the full economic market price for another home. Such a person is not speculating; he is genuinely moving. Under those circumstances should he not in fact, where he has to pay the full economic price for his new home, be able to utilize the proceeds from the sale of his original home in order to buy his new home? That is merely one example that I give but there are many others that I could mention.

In this particular regard I should like to suggest that there is another way in which one can look at this matter, that is to say that such a person is paying a certain price for his house now but that the price that he should be paying for it is that amount plus. The difference between those two amounts would then be his potential indebtedness should such a person sell during the preemptive period and that amount could then be utilized either wholly or in part depending upon certain circumsatances that could be laid down in the regulations. However, I do believe that there should be a positive formula and not merely a formula according to a sliding scale as for example on a 10% per annum basis. I cannot help but feel that that could present a number of problems when one tries to apply it. I would appreciate the hon. the Minister’s giving these few points that I have raised some consideration because they are likely to be considered more equitable and certainly are likely to be considered more acceptable.

The hon. member for Sea Point made a statement which I found rather interesting and also rather surprising coming from him. He said the problem was not that housing was not available but that it was so expensive that people could not buy homes. Mr. Speaker, I fear that I cannot possibly allow a statement of that nature to go by default because it is just not true. Housing for younger people is just not available. Because of a number of reasons, there has been very, very little home building in the private sector for many years now. In consequence, there are virtually no homes for sale at all. Therefore, anybody who has to sell a house can ask any price. The very fact of the crazy prices that are being asked for the most mediocre houses here in Cape Town is a classic example of that. One finds that there are thousands of houses that are advertised for sale, but people are living in pretty well all of them. They are only trying to sell those houses in order to make a small fortune out of them. That situation has only developed because there are no houses in any quantity available.

As has been said, I do not know whether in a debate such as this, one can say a lot which is new because over the last year or so there have been so many debates involving housing and matters relating thereto that almost every aspect has been covered. I again must repeat and reiterate, however, the real problem is that housing stands are not available for development. That is the real cause of the trouble in most of the major urban areas, and it applies for all race groups.

For a long time we had the opinion that the problem was not too severe for the White community, but regrettably over the last two or three years it has been getting progressively worse.

Everything Progressive must.

Yes, anything to do with the Progressives is bad, I suppose. [Interjections.]

Although I am aware that there is a commission sitting on township development—in fact, I am a member of it—and that it is hoped that as a consequence of its activities more land will become available and more quickly, I am of the opinion that it is going to be imperative that in addition to more land becoming available and more quickly, the stands available will be smaller so that people can afford to get on them because the services per stand will be that much cheaper. Generally it will then become a proposition for private enterprise to get into the building trade again as they were used to building small cottages.

I have said it before, but I think it bears repeating that after the Second World War the housing problems for the White community were not resolved primarily by State department; they were resolved primarily by private entrepreneurs. The land was made available by the municipalities and the provinces, but once the land was made available private enterprise got in, the small builders got in, the smallest developers and one or two of the bigger developers got in, and only a relatively small proportion of the five or six year housing backlog was taken up by various State departments, such as the Natal Housing Board and the National Housing Commission or whatever it was called in those days. There were a few State bodies that did a certain amount, but I can assure the House that the majority of it was done by the private entrepreneur because the serviced sites were available.

This is the point: If we had around each major local authority a very large number of serviced sites available, I am prepared to take any sort of wager that within a very short space of time private enterprise would resolve our housing shortage problem. They must do it; this is what our whole system of free enterprise is all about: A need must be established and private enterprise must be put into a position to be able to resolve the problems of that need. Private enterprise will then step in and the problem will be eliminated. As far as I can see, this problem can be resolved primarily by getting serviced sites.

Another point that was made, one with which I am afraid I cannot agree, is that one should have retirement villages for pensioners. My constituency happens to be one of those that has a great number of pensioners living in homes and institutions, and one of the points made to me time and time again by these dear old ladies and gentlemen is that they wish they were still in the community, in society. They say they would rather live in a little flat let somewhere in a big block of flats or in a community where they could mix with young people. They did not want to feel that they had been pushed to one side, albeit into a nice comfortable little niche, where they were just waiting to die. The feeling many of them had was that they would like to be in and part of the community. Many of them felt they could provide some small service to the community if they were part of the community, perhaps doing some baby-sitting or something like that.

Or canvassing.

Never mind canvassing. [Interjections.] The people up in Water proof and all those other places probably know something about that. I would therefore hope that we do not overdo this business of retirement villages for pensioners, saying to the old ladies and gentlemen: “You have done your thing; now just wait there until you die.” I do not like that and they do not like it either. I accept that it is essential to provide facilities for geriatric cases, but that is another story. However, I do not think that that should influence one into thinking that there should be a proliferation of villages for pensioners only.

I want to make it clear that, in so far as utility companies are concerned, I believe they can serve a useful purpose. Although I have only for a relatively short time been on the board of a utility company, I believe such companies can help the community. I know that the hon. the Minister has had difficulty in being able to help the utility companies—that is the reason why we have this Bill before us now. However, the hon. member for Hillbrow wanted to know how one starts a utility company. It is quite simple. All one has to do is to get hold of a few simple souls who want to assist their fellow men in a practical and realistic way, for example by finding homes for them, and who are prepared to do the hard work and get nothing for it or even suffer a loss.

And who are prepared to underwrite overdrafts.

Yes, and to underwrite the overdrafts. In that way one can establish a public utility company.

I can say that in the utility company of which I am a member we have a fairly wide spectrum. We even have an architect who—and it is very rare for that breed—is donating his services for nothing. We also have builders and various other people who make a point of ensuring that they do not get involved in the contracts of the utility company. We seem to have people who are knowledgeable. I think that if one gets enough of these companies and if the department can make available to them not only money at preferential rates but also land, they can do a great deal towards assisting in resolving the problems being experienced.

Therefore I am very, very happy indeed to support this Bill, although, as I have mentioned earlier, I hope that the hon. the Minister will give a little further thought to the question of the benefits clauses to ensure that people do not make too much profit out of selling.

Mr. Speaker, it is a good thing that statutory provision is now being made in this Bill that funds from the National Housing Fund may now be made directly available to utility companies, because in the nature of the matter, that eliminates duplicated and unnecessary administration and I am certain that it will also eliminate unnecessary delays in the financing and provision of housing. I do not doubt for a moment the potential of utility companies to make a very sound contribution towards relieving of the acute housing shortage in this country, and I think that there is every reason to believe that utility companies will be even more necessary in future and will play an even greater role than has been the case thus far. The utility companies that already exist have already done a tremendously good job of work, particularly in the Cape Peninsula, where several of them are in existence, some for a long time now. They have been of great value and have been responsible for establishing high-class suburbs. I think it is a great pity that more of these companies have not been established over the years so that they could make an even bigger contribution than they are doing at present. I think that at this stage this type of institution is more necessary than ever, particularly in view of the situation which is described by the hon. member for Sea Point as a housing crisis.

I just want to react briefly at this stage to two points made by the hon. member for Umbilo, two points concerning which he thinks that he and the hon. member for Sea Point differ. The one is that the hon. member for Sea Point supposedly said that there was no shortage of housing as such but only a shortage of housing that people could afford. I think that the standpoint of the hon. member for Sea Point was merely that “there was a shift of emphasis”. The one aspect of the problem became more prominent than the other aspect. However I do not think that he or anyone else would want to intimate that there is no shortage at all at this stage.

The other question is the question of the so-called “retirement villages”. In this regard I differ with him. I do not wish to suggest that one cannot establish such retirement towns which would indeed give rise to a feeling of isolation among our older people. I have little doubt that that is indeed the case. It even happens where working people, for example, are confined in a specific area, say for example, people who work for the Railways whose housing is grouped closely together. Then, too, there are people who serve in the Difference Force and people who serve on the mines. They, too, are usually concentrated in a certain area. In that regard I agree with the hon. member. It is clear that this entails disadvantages, and I can see that people are unhappy about it. However, the point I want to make is that the idea of a retirement town does not necessarily imply that it must be created in isolation from the rest of the community. It could be linked up quite successfully with the existing community, while the obvious benefits of such schemes, viz. that older people can obtain relatively cheap housing and live within a relatively short distance from medical facilities and that kind of thing, can still be retained in spite of the elimination of the disadvantages. Therefore it is more a question of planning, and not one in which the principle of the creation of retirement towns need be at issue. The cost increases to which reference has already been made by hon. members have, of course, created havoc throughout the housing market over the past few years. There has been an increase in building costs, in house and flat prices and in rentals for flats and houses as well. This, together with other dramatic developments, particularly in the sectional title market in certain areas, has turned everything upside down for many people. The hon. member for Sea Point and other hon. members have already given examples of what has happened to the value of money, particularly in the housing market.

There is another example I might also mention. I remember so well the first announcement by the hon. the Minister’s predecessor that rent control would be lifted gradually. At that time he set the condition that in cases where rent control was lifted, the owner should not be permitted to increase the rent by more than 10% per annum during the first two years after the lifting of rent control. Measured in terms of today’s standards, that percentage is almost ridiculous. I think the hon. the Minister will concede that. It is almost ridiculous. Nowadays an increase in rent of 50% in the case of flats, and even houses, and even in the case of controlled premises, is nothing unusual. One can only imagine what effect this may have on the income position, on the financial position, of older people in particular, those living on pensions who have no prospect of an increase in income.

Speculation in the housing market has given rise to considerable distress in areas such as the constituency that I represent—and particularly in that area—where certain developers have made fortunes, whereas the general public, and the older guard in particular, have been exposed to an extreme degree of fear and uncertainty. I believe that in this regard one should always bear in mind that the worst thing one could probably do to anyone, short of inflicting physical violence on him, is to jeopardize the roof over his head. One could hardly find any better way of engendering fear and uncertainty in a person than by bringing him to realize that due to increased rentals, increased prices in any respect at all, he may no longer have a roof over his head within a month or two. Anything of this nature creates a very grave situation.

Of course, this phenomenon has manifested itself in other fields too, not only due to speculation in the property market, but also to inflation in general. Here I want to refer in particular to the situation which has begun to occur in the Cape Peninsula, and more specifically in my own constituency. Even in old-age homes the position has occurred that inhabitants themselves find themselves in a state of severe crisis due to the increase in rentals they have to pay to live there. Here I refer specifically to two old-age homes in my constituency—Sea Point Place and Bay Beach Place. If I say that over the past few weeks I have received dozens of telephone calls from people with complaints, I shall in no way be exaggerating. I am sure that the hon. the Minister has also, perhaps, received complaints. Perhaps the Department of Community Development, too, has received complaints from people who are alarmed to the utmost degree, due to their financial situation, which has become precarious due to rentals and tariffs which have been increased very drastically just recently. I know of one case in which a person who had paid R170 to live in one of those homes was suddenly required to pay up to R400 per month. There are several cases in which the increases have varied between 50% and 150%.

Must we introduce rent control again?

No. The hon. member for Bellville would do well to listen to me. We can imagine the desperate plight of those old people as a result of this. They are people who believed that that was one place, at least, where they would be safe or relatively safe, where they would enjoy protection against the excessive increases in rentals, higher prices, etc. They thought that because the Government kept an eye on affairs, because several of those places were subsidized, that there was at least one place where they would indeed be safe.

What two places did you speak about earlier?

About Sea Point Place and Bay Beach Place. To tell the truth, I can put it to the Minister that as far as I know, this applies to all the homes that fall under the control of the Cape Peninsula Welfare Organization for the Aged. I might also just mention that the hon. member for Sea Point and I, together with our colleagues in the Provincial Council, asked for an interview with the management of that organization in an effort to determine whether we could not perhaps, by way of an exchange of ideas, put certain proposals to the hon. Minister in an effort to afford relief in that situation. However, I can assure the hon. the Minister that those people are in a desperate situation. Some of them are even undergoing a nervous crisis as a result of their feeling of insecurity. The fact is that often older people are unable to assimilate such a situation, and now they are living in fear to a very great extent. One hopes, of course, that it will be possible to do something about the problem in due course. I just want to make the point that some of those people had in fact sacrificed small flats before moving to these homes. They did not necessarily go there because of the possibility that medical assistance might be closer at hand, but purely because they believed that that type of housing would be inflation-proof. Today, however, they are totally disillusioned, and one can only sympathize with them. At this stage I am merely mentioning the matter. However, I want to assure the hon. the Minister that we shall approach him again at a later stage, when we are able to make certain suggestions concerning what can be done to deal with this problem. It is simply not right that accommodation in old-age homes of that nature should nowadays be made available for the same sort of price as accommodation in a luxury flat in that specific area, in this case the Sea Point and Green Point area. I regard that as totally unacceptable.

This brings me to a specific aspect of the Bill. Hon. members have already dealt with most of the aspects of the Bill and have done so at some length. However, I want to refer to clause 3(b). The envisaged subsection that is to be inserted concerns the determining of that portion of the selling price that is to be repaid to the Housing Fund. The hon. the Minister indicated that at present a method was being considered which would be determined by regulation. I should just like to put a suggestion to the hon. the Minister. One could also achieve a second purpose if one made use of a specific method. The hon. the Minister’s aim was originally to ensure that people did not make use of this money to make excessive profits. Of course, this also creates the possibility of some extra income for this Housing Fund. I contend that one could at the same time ensure that the selling price—when the houses are sold from time to time—is kept low if one draws up the formula in such a way that the seller is only permitted to make a certain fixed percentage in profit. I say “percentage” for the sake of argument. For every year that the person lives in a house he must be permitted to make a certain percentage of profit. Everything above and beyond that amount is automatically repaid to the Housing Fund. [Interjections.] In other words, we must not have a formula in terms of which, for example, half of the profit—whatever it may be—has to be repaid to the fund, because that would mean that the seller would still try to make the highest profit, because he has to share it with the fund. I would prefer that a ceiling be imposed on these people. Then, when the house is put back in the housing market, their prices can be kept as low as possible. In view of the present state of property prices, the whole business has gone crazy—anything the authorities can do to suppress this trend, is to be welcomed. Accordingly I want to put this to the hon. the Minister for his consideration and I hope that he will be able to give me an answer in this regard.

Accordingly it is a pleasure to lend our support to this Bill.

Business suspended at 18h30 and resumed at 20h00.

Evening Sitting

Mr. Speaker, as previous hon. members have already mentioned, this Bill actually originated at the Good Hope Conference on 12 November 1981. It is there that the hon. the Prime Minister announced that the whole idea of utility companies should take shape. We are now seeing the effect of that speech. Therefore we owe the hon. the Prime Minister a profound debt of thanks for the role he played, as well as the department that followed the idea through, so that today we have reached the stage at which effective action is being taken.

†The fact of the matter is that this Bill allows us to help establish utility companies in addition to those that currently exist. The underlying principle is that we know that utility companies that exist have been extremely successful over a long period. That we know. We know we have a problem in regard to the provision of housing in our country. It is therefore in a sense obvious that we should try to promote and proliferate the tools that we know have been effective in the past.

This Bill is in a very real sense a tribute to the work that has been done to date by utility companies. I talk of utility companies, but of course a company is nothing. It is the people who make up that company. It is the great people who have led that movement over a great many years, those people to whom the hon. member for Witbank referred tonight, whom we honour in introducing this legislation. We can think here of Richard Stuttaford, who has been mentioned, Zerilda Steyn, Bishop Lavis and many others. We can also think of many other people, not only on the boards of utility companies over the years but also on the management bodies. It is in the management bodies—the executives who do the job—that we have found the most enormously dedicated people. I have had the privilege of working with some of these people over the years. I think of people like Selwyn Myers and Fred Pohl who have with great dedication served the cause of housing and served the cause of those people who are fragile in some way or another and who would not otherwise have been able to be accommodated by society.

The question we must ask ourselves is: Why have they worked successfully? The reason why they have worked successfully has become extremely important for us to identify. They have worked successfully because they have been able to develop experience and because they have had continuity. Many developments that take place do so on an ad hoc basis, but these people have been able to build up experience over the years. Their staff, management and directors have been able to build up experience over the years and have thus been able to refine the whole process of housing. They have also been able to accumulate capital over the years and they have been able to increase the scale of their developments over the years.

If we look at the reason why utility companies should be able to provide housing more cheaply than any other company, we find that the answer lies not only in the way in which they are structured, but also in the way they operate and in the way they have mobilized the experience which they have gathered over the years. I do not want to speak out on the Townships Commission, but it was alluded to by the hon. member for Langlaagte tonight. However, the fact of the matter is that when one sits on the Townships Commission one realizes that each time one comes to a norm, which is the ideal which currently exists in our country, more often than not, that path leads one to the existing utility companies in terms of norms, standards, costs, effectiveness, etc. In a very real sense they have become the yardstick by which the housing establishment companies, development companies have measured themselves in our country, because they develop houses more cheaply and because they have a total approach to housing. The fact is that they are able to apply more economical standards—not lower standards—such as narrower roads, shorter roads, more economical stormwater arrangements and smaller even. Without reducing the privacy of individual houses they are able to build to scale and are therefore able to achieve the economies of scale. They are able to develop on a sustained basis and therefore they have stability within their labour force. They are able to build without following the natural cycles of the market. They can flatten the curve. They can develop at times when other people cannot develop, when the cycle has in fact turned against the normal developer. Therefore, for these and many other reasons the utility companies have done a very fine job in our country. To the extent that this legislation underlines that, to the extent that this legislation promotes the more effective use on a wider basis throughout our country of this whole concept of utility housing companies, one of course welcomes it.

I should also like to thank the utility companies, existing housing companies, for the leadership they have given to the new utility companies which are in their formative stage. A conference was held here in Cape Town by the two utility companies in Cape Town, i.e. Garden Cities and the Housing League, in order to give leadership to those people who have taken the first few steps along this road of developing further utility companies. I should like to see this continue—that the current companies that have experience will attempt in these formative years to cross-pollinate, help, assist and advise wherever possible the daughter companies that are now being brought into life in other parts of our country. I think that is very important, because it is not only a question of the technical experience that they can give these people. They can fire them with the dedication and with the enthusiasm that have been the tradition of the housing companies that have been operating thus far.

As far as the Bill is concerned, I have one small problem with it which I should like to raise with the hon. the Minister and that is this whole question of discretion when a house is sold. As we now understand from the Bill, that house can be bought back after a period of ten years—there is a pre-emptive right—or the house can be sold. On the sliding-scale we have the situation that there is a profit-sharing arrangement that can take place. All of that I agree with. I was a little worried about the time factor but I have been persuaded by the department that we should leave it at that and see what happens and so I shall not go into that any further. What does worry me, however, is the question of discretion. It has been my experience that the less discretion one has and the less the hon. the Minister is asked to exercise discretion, the better. For example, the utility companies on which I serve have a waiting list for houses. We may have 1 000 houses on the waiting list and I want to say that there is absolutely no discretion. Neither the managing director nor any member of the board has any discretion whatsoever. Once a person is on that waiting list and he is an approved person he obtains his house on a first come, first served basis. In the Bill we have a discretionary power in that if a person wishes to sell his house, a discretion has to be exercised. What happens then? We can either say: Look, we are going to exercise our pre-emptive right or we can say that the house can be sold and there is to be a profit-sharing arrangement. We can also say to the man that because he is moving for genuine reasons he can sell the house and retain any profit that may accrue. In the first instance I want to say that I do not like the concept of this discretion very much at all. Let me put this by way of a question. If a utility company builds from its own funds and then finds that one of its home-owners wishes to sell within the 10 year period, whose discretion will be involved? Will the utility company have the discretion? If such a home has been built out of housing commission funds, perhaps through a municipality, will it be the hon. the Minister or the local authority who will exercise discretion?

To exempt?

To exempt. Having put that question, I should like to put this point to the hon. the Minister. From my experience I would say that the less discretion we have, the better. I also think that the less discretion that the hon. the Minister has, the better. I say this for no other reason than that one of the great things about utility companies is that they depoliticize housing. I feel that if there is one thing that we must do in South Africa it is to depoliticize housing. The fact remains that this is in keeping with our policy as far as sectional title is concerned. The intention is to keep housing away from the Government. If that is our policy in respect of this fantastic plan to sell 500 000 houses in our country over the next 12 months then it will have the effect, among others, the profound effect, of depoliticizing housing. I think that if we are going to introduce anything into this whole scenario that is going to have the effect of politicizing housing, it will be a bad thing.

The hon. member for Sea Point said that he was concerned as to how the funds would be used. He mentioned controls. He did not actually suggest them but he hinted at them. I want to say that experience has shown that the less control one has, the better. We must place our confidence in good people from the private and public sectors. They must hire competent people to run these companies and from then on I feel that the less the Government has to do with them, the better. That has proven to be successful over the past 50 years. At the moment, of course, it is true that where the Government comes along and finances a particular scheme, obviously the Government will have to approve the scheme in any event. Therefore we already have that control. As far as I am concerned, further controls are not at all necessary.

I do not think we should turn this discussion into a widespread housing debate this evening because there will be opportunities for that at a later stage. However, I would like to say that the principle we will be accepting here tonight is that letters expand the activities of structures and organizations that have already been found to be successful in our society. That is the principle that we are re-establishing here tonight. However, one of the problems that may perhaps lie at the root of all our housing problems in this country is the fact that we wish to increase the housing stock in our country. We have the building society development companies currently operating effectively. There are strictures on the building society development companies that do not allow them to develop on the scale which they would like to and on the scale at which they can conceivably develop. The reason, I understand from the Registrar of Companies, why they want to discourage and limit the activities of the building societies from developing is that Bifsa has the point of view that if those people are allowed to develop, they will give bonds only on the properties they develop and not on properties other people may develop. That lies at the heart of the objections to allowing the building society development companies to expand their activities further.

I do not believe that is a realistic objection. I think that less than 2% of the money of the building society movement at the moment goes to development in which they themselves are involved. One can set limits if one wished to—5% or 10% —but all I am saying is that we need to turn on the existing machinery within our existing society now to develop additional houses at this stage and as quickly as we can.

The utility concept is a very good one, but it is going to take time for those utility companies to come on stream and to begin to render houses on any scale at all. On the other hand, if in regard to the building society development companies we were to make a few amendments, I think they could not bring on a spurt of houses which in my view would help us enormously. They can do it quickly because they have the funds to do it. If one likes to, one can encourage them to develop in only a particular direction. One can try to restrict them to lower cost housing. I think that to let that instrument lie idle and to look for other instruments in order to get this whole thing going is wrong-minded. It must be borne in mind that that is an effective instrument and we should not restrict it by means of legislation. If we do that, then I think that we are not using the potential. If the building society movement cannot develop housing corporations, if they cannot have a more active and direct part in the creation of housing stock, then I do not know whom else one can expect to encourage to take part in that process.

I do not want to say very much more except to say that property rights are not rights which relate to property; in essence property rights are human rights. Therefore it is in extending the housing stock and in extending the principle of home-ownership that in a very real sense the hon. the Minister in his time has brought greater individual freedom to a greater number of people than perhaps any of his predecessors had the privilege of doing. To that extent I want to congratulate the hon. the Minister. I cannot think of a time while I have been involved with this whole industry when there have been more excitement and more things happening than now. The hon. the Minister does not talk about houses; he talks about people. I have always noticed that. If one talks to him about houses, he ends up talking about the people. He never talks about housing units; he talks about the people who live inside those homes. That is his whole approach. What I say of the hon. the Minister applied equally to the hon. the Deputy Minister. They are a very fine team and we are proud of them. We are very proud of the legislation and we wish them well with it.

Mr. Speaker, the hon. member for Maitland quite correctly mentioned the factors which will provide for cheaper housing when utility companies become involved. I echo those sentiments. It was an interesting analogy to talk about housing rights being human rights, and we may get an opportunity in the weeks ahead of us to debate the particular subject. Another matter which he raised was one which has been raised from this side of the House already, and that is the lengthening of the pre-emptive period from five to ten years. That has been questioned. My hon. colleague from Sea Point has mentioned that. He also said it was not a matter we considered of cardinal importance, although we were concerned. Five years is possibly a bit short. On the other hand, ten years might be a bit long. It has been mentioned here this evening that the average occupancy of a house is about seven years. We hope that, when the hon. the Minister replies to this debate, he will motivate that extension to us.

My short contribution to this debate will be simply to endorse and to highlight the input made by hon. members in these benches. The speeches made by my colleagues from Sea Point, Hill brow and Green Point were, I believe, substantial contributions and indicate that our housing group has made a thorough study of this Bill. We are pleased to support the Bill because it will facilitate the supply of housing. This is of great importance to us because, as hon. members are well aware, that is one of the major problems presently facing this country. Hon. member are also aware that, even though we are in the middle of an economic down turn, the price of property continues to escalate at what can only be called an alarming rate. Press reports of late have highlighted the high cost of property not only in the Cape Peninsula but throughout the country. There is no indication that this situation is to be alleviated in the short term. Any measure, therefore, which is intended to improve the housing situation, no matter by how little, is to be welcomed with great enthusiasm. As has been mentioned, young people, newlyweds, those acquiring their first home, are faced with the prospect of saving for many years to accumulate sufficient funds for a deposit on a really modest home. Because of the current interest patterns, the purchaser will have to cope with large repayments over a long period. The future for the aspirant home-owner is indeed bleak as the financial burden becomes increasingly severe.

It is, however, not only the home-owner who has this burden to bear. The flat and house occupier also has to bear it. The scarcity of dwelling units and the high interest rates have had a deleterious effect on the availability of accommodation for those wishing to rent. This Bill is a welcome measure, therefore, as it will have a ripple effect on the whole housing situation. By creating housing utilities, it will enlarge the whole housing pool and so release pressures in other areas of the market. The other areas of the market include those flats and houses which I have mentioned and which are available for rent.

My constituency includes a large number of flats which are no longer subject to rent control, and they are occupied in the main by retired people who have to manage on pensions or fixed incomes. As we all know, people who live on fixed incomes and who have reached an advanced age have no prospect of supplementing their incomes even if some form of suitable employment should become available. Because large numbers of flats in areas such as Illovo, Melrose North and Rose bank in Johannesburg are no longer subject to rent control, the rents of these units are increased at regular intervals. The people I mentioned earlier, the people who when they retired some years ago believed that they had accumulated sufficient funds to provide for their old age, now live in a state of anxiety, waiting for the next rental increase notice from their landlord. One of the reasons for this problem is that there is a shortage of housing. If one looks at the population projections, one finds that we will soon be facing a problem of enormous proportions. Any form of assistance is therefore acceptable and we believe that the Bill before us will go a long way towards alleviating the situation.

Another aspect of which we should not lose sight is the provision of old-age homes and, as has been mentioned, retirement villages. This, too, is becoming a problem of great proportions. Again looking at my own constituency, I find that I have a large old-age home in the Bramley area and a smaller establishment in Melrose. Both are fine organizations providing a sterling service to the community they serve. The accommodation they provide is, however, insufficient and there are long lists of people waiting to enter these institutions. If a utility company were to be formed to construct old-age homes, for example in Illovo, I have no doubt that there would be a great deal of enthusiasm for such a project. In fact, I am aware of the need for such a facility and I know of members of the community who are willing to support such a project. It is with great pleasure therefore that I on behalf of my party support this Bill.

Mr. Speaker, the hon. members on both sides of the House covered a very wide field in their discussion of this measure. What they said did have a bearing on housing, but I cannot say that all the speeches made dealt exclusively with this legislation before the House at present. However, the speeches were all so positive, that I found it extremely pleasant to listen to them and I shall therefore go out of my way to reply to them and not to confine myself solely to discussing the provisions of the legislation before this House. However, because the legislation is the most important, I think I must first reply to speeches in that regard.

Firstly, as hon. members are aware, this measure facilitates assistance to housing utility companies. There was general agreement that this was a good thing. Secondly, it extends the duration of the pre-emptive right from five to 10 years. Then, too, we have come forward with a new provision in which we have made it possible—I am saying we have made it possible, since it is optional; it is not compulsory—that when the pre-emptive right is not exercised, a portion of the profit may be claimed by the commission, a local authority, the housing utility company or whoever the body is that originally provided the house that was built with Government funds. As the hon. member for Bellville said, it is quite right that we should see this measure against the background of our new housing strategy, a strategy in which housing utility companies and the promotion of home ownership are very important components. The standpoint of the Department of Community Development is that this new approach to housing must succeed at all costs. Consequently, we are not going to do anything which is going to bind us or place obstacles in our path which will prevent us from causing this new approach to succeed. We are going to do everything in our powers as far as this tremendous new undertaking is concerned, to sell almost half a million houses to their present occupants and to make this a huge success. Of course, this is no easy task. It is a tremendous undertaking. It is a unique undertaking. It is going to require a great deal of effort, so much so that we realized that we would even have to appoint someone, an expert, from outside the department. That is why we have appointed Mr. Johan Kruger, who is at present attached to the Urban Foundation, as project co-ordinator to come and work in our department for a while—since it is not only the Department of Community Development, but also the Department of Co-operation and Development is involved in this project—so that the sales campaign can be launched in a properly co-ordinated way. We are therefore determined that this undertaking should succeed and we are on the eve of this tremendous undertaking, since it will be launched on 1 July. In fact, this measure links up with it. It is hoped that we are going to sell thousands of houses to people. However, we are certainly not going to sell them in order to speculate. Therefore no one in this House can find fault with this. In fact, we want to prevent a tremendous amount of speculation being set in motion with houses which have been obtained from the State at relatively reasonable prices. The department and I have held protracted and in-depth talks with everyone who is and could be involved in the sale of these houses. We also went out of our way to speak to Coloured and Indian community leaders in particular, to negotiate with them and to ask them whether they would go along with us in this process.

Hon. members have also had a great deal to say here about the extension of the preemptive right from five years to 10 years. This is a request that was put forward not just recently, but a long time ago by members of the Coloured and Indian communities, since it creates problems for them, too, as well as for the department itself, of course. After all, we have sold a tremendous number of houses to those people over the years. I need only refer to Mitchell’s Plain, where thousands of houses have been sold to Coloureds. There are many similar schemes through which we have sold houses to non Whites, in this country.

However, what are the Coloured leaders saying to us now? They are saying that Coloureds who purchase these houses receive a fair offer for them shortly after having purchased them, an offer that affords them the opportunity to make a relatively large profit on them. Then they offer the property to the city council, which in this case provided the loans from housing fund money. Because there is no money available, the pre-emptive right is not exercised and the Coloured owner concerned takes the profit for himself. However, he does not purchase another house with that money but uses it for another purpose. Because his income is still within the limits of those entitled to housing aid from the State, he simply places his name on another divisional council or Cape Town city council waiting list, or even on one in Parow or Bellville. Then he competes with others for a house once again. We simply cannot keep track of the people we have already assisted in this way. However, they are involved in an unfair practice. We have been asked to see to it that this kind of thing does not continue and it is for this very reason that we have submitted this measure to this House. I am not married to this, but I do just want to point out to hon. members that the period of 10 years should be regarded as the maximum period.

I intend altering the existing Act. I want to point out to hon. members that there are various ways in which exemption from this provision may be granted. In the case where the Housing Commission grants loans to individuals, section 21(7) of the principal Act provides as follows—

That is with regard to home loans to individuals. When it is a matter of money granted by local authorities in the form of loans, we find that exceptions can be made and that exemption can be granted in terms of section 56(8), which reads as follows—

Therefore, where it is a matter of a case of hardship, to which the hon. member for Umbilo also referred here—for example, people who are transferred or who simply have to sell and move elsewhere due to unforeseen circumstances—exemption may be obtained, and in such cases exemption is generally granted. Besides, until now the Act has provided that in the case of local authorities it is compulsory that there be a pre-emptive right. This is a condition in section 56 of the principal Act. Therefore it is compulsory that there be such a pre-emptive right. Clause 4 is now amending section 56 of the principal Act. It is provided that “The Commission may at any time … Therefore it is now being made optional. In other words, the 10 years must now be regarded as the maximum period. Within that period of 10 years the utility company, in consultation with the commission, could say, for example: As far as this scheme is concerned, we do not want the pre-emptive right. Then the commission could concur, or the local authority could say: As far as this scheme or this group of houses we have to build is concerned—we only want the pre-emptive right to apply for four years, or perhaps five or even six years. This could then be done. Therefore it is quite optional. However, in order to make it possible for the portion which has to be repaid to the State, the commission, the local authority or to the utility company not to be so large, one would like to prolong it over a period of, say, 10 years—for Coloureds for example. Therefore, if a person sells during the second year, he should not simply be able to obtain two-fifths. In such a case he must surrender a smaller amount. This is deemed to be an extremely fair provision from all points of view and we shall administer it with as much circumspection as possible. That is why I should prefer not to incorporate this provision in the legislation. What the hon. member for Langlaagte said here was correct. Other hon. members of my party have also said to me in the past that it could, in fact, serve as a deterrent, that it could deter certain people wishing to purchase a house. After all, our whole purpose is to sell these houses, to do everything possible to sell those houses. Consequently, I am not going to bind myself to something which is not going to work. We must bear in mind that what we are dealing with here is something new. It is an experiment. I do not wish to spell everything out in this legislation, for what will happen if it does not work? I want to sell these houses in the years ahead, and if this is embodied in the legislation and it does not work, I cannot alter the legislation before next year. However, a regulation can be altered. In this regard hon. members must accept my word—as well as the good intentions of the department—that we want this thing to work. Therefore we want to spell out the detail of these procedures in regulations, rather than in the legislation itself. As far as that is concerned, I hope that I have now satisfied hon. members.

The hon. member for Sea Point and the hon. member for Umbilo said that one should know what one is letting oneself in for. The hon. member for Sea Point referred specifically to the fact that previously, arbitration was necessary when the price of the house had to be determined. However, we now wish to leave it to the utility companies, the local authorities, to determine this. The hon. member for Sea Point and the hon. member for Maitland said we should not be so terribly prescriptive, that we should not promulgate so many regulations from the top. We should afford the local authorities, and in particular the utility companies, where one wishes to develop private initiative, the opportunity of using their discretion a little too. They said we should leave it to them. There is just one thing I should like to say to the hon. member for Sea Point in this regard, and that is that it would not be fair to sell someone a house and then, right at the end, when he sells it, begin arguing about the portion to which the department, the commission or the housing utility company is entitled. It is not fair to start arguing at that stage about the price and the conditions. That is why we are saying—and I am saying this to the hon. member for Umbilo as well—that whatever the utility company, the local authority or the commission may decide, should be written into the contract of sale. In other words, if a person purchases a house which is subsidized by State funds, he must know what he is letting himself in for when he sells, and the pre-emptive right is exercised. It must be expressly stipulated that, for example, when someone sells his house after two years, he may take two-tenths of the profit and the State or the utility company the other eight-tenths. When a house is sold after five years, the seller receives half the profit and the organization concerned the other half. There must be no uncertainty about this. Instead of leaving it to arbitration at the conclusion of the 10 years, it is stipulated in the contract in advance so that everyone knows precisely where he stands.

As a matter of interest, I wish to mention that in terms of this legislation there are going to be exemptions. We do not intend exercising the pre-emptive right as far as the sales campaign among Black people is concerned—most houses coming onto the market now are intended for Blacks—since the Steyn Committee recommended that this should not be done. Due to there being virtually no property market in the Black residential areas, and since no purchaser will be able to purchase more than one residential unit, the Steyn Committee is of the opinion that the present pre-emptive right in favour of the local authorities in the case of resales within a period of five years could have a detrimental effect on the planned sales campaign. It was therefore decided that no preemptive right would be introduced. In terms of this, a free market situation will arise, and, simultaneously, the opportunity for the promotion of Black estate agencies. In other words, one has here a good example of our granting permission, in terms of the right we have, for thousands of houses to be sold without the provision concerning pre-emptive rights. If there are other local authorities or communities who feel that as far as the scheme in respect of the sale of 500 000 houses is concerned, the pre-emptive right should not be applicable in their cases either, they could approach the commission and we would consider this very favourably. I want to reiterate that this is an experiment. It is an attempt to exercise pre-emptive rights truly effectively. Hon. members must afford us the opportunity of not being too prescriptive in this regard and of being able to deal with this by way of regulation, according to the measure of success we achieve with this in practice.

I now have a few brief remarks to make in reply to what individual hon. members had to say. The hon. member for Sea Point said that the problem being experienced in respect of housing could largely be ascribed to increasing interest rates and building costs. I also think the hon. member for Langlaagte said that economic factors were among the most important factors influencing the price of houses. One cannot get away from that, but one might just as well include in this the increasing costs of municipal services and increasing municipal rates. Our town councils are taxing their residents right out of their houses. People are becoming so frustrated because of the continual increases in rates and service fees, that eventually they sell their property and seek the department’s assistance, or they go and live in a flat, where once again they experience problems with regard to increasing rentals. Therefore there are various factors involved. However, the hon. member agrees with me that housing utility companies can provide cheaper housing to certain groups of people and that they can afford relief to those groups. That is all we are aiming at with this legislation.

The hon. member also warned us that the taxpayer’s money was going to be made available at a greater risk. I concede that point to the hon. member for Sea Point. However, I just want to say that there are checks and controls. In terms of section 17A these utility companies will be compelled to submit financial statements to the Director-General of Community Development, who is the department’s accounting officer. Moreover, the Income Tax provides that the Minister of Community Development may appoint a director to the board of directors of these utility companies. The hon. member for Tygervallei and the hon. member for Maitland are members who have been appointed to the Housing League in this way. I am only referring to two of the members now, but there are others who could be my representatives on the board of directors and who could then monitor the financial position of those companies. Therefore control measures are being incorporated, and the fact is that when these utility companies are registered with the department, certain conditions will be stipulated and the Director-General of Community Development, who will be the Registrar of these housing utility companies, will satisfy himself that the financial position of these companies is basically sound.

The hon. member for Witbank made a very interesting speech. He, too, referred to the problem of the large number of home seekers, but he did add that people seeking a home should adapt and scale down their requirements. We cannot continue living above our means. Many people try to acquire a home they cannot afford, and I agree wholeheartedly with the hon. member that our standard of housing in this country is extremely high and that we shall have to scale down these standards somewhat. The hon. member mentioned the fine work local housing utility companies and certain individuals, for example, Bishop Lavis and Mrs. Zerilda Steyn, have done in this regard. It is entirely fitting that he should have paid tribute to these people today.

The hon. member for Langlaagte said that he did not expect these measures to perform miracles. I agree with him, but they will probably alleviate the situation, and that is why we have to try all these things. This is simply one aspect of our housing policy. We have to consider every possibility. It also depends on the extent to which we are going to succeed in establishing active housing utility companies in other parts of the country as well, as to whether we are going to succeed in supplementing the supply of houses in this way. I am referring now to utility companies other than the two old companies which already exist in the Cape Peninsula.

The hon. member also referred to 68 unoccupied flats at Rynsoord. I wish to inform the hon. member that we have no housing projects at Rynsoord. Therefore no State money was involved in that project. Why the flats are unoccupied, I do not know. Perhaps we could look into the matter. There are a few unoccupied houses in-Lenasia. Those houses are being reserved for Indians who are living in Pageview at present and who have to be moved to Lenasia. This is why the houses are temporarily unoccupied. We hope this problem will be solved in the near future.

The hon. member quite rightly stated that factors such as township establishment have had a tremendous influence on the provision of housing. The hon. member for Umbilo mentioned this as well. Those two members are members of the Venter Commission, which is investigating all aspects of township establishment. The Government and I, as well as my department, have great expectations as regards the recommendations of that commission. I am sure the members of that commission will apply all their expertise and that they will submit to me their proposals, which I should very much like to implement on behalf of the Government, as as soon as possible. It is true that the protracted and costly process of township establishment is the biggest single factor that is delaying the provision of serviced sites and forcing up the prices of those sites. I therefore agree wholeheartedly with hon. members that a solution must be found in that regard. I am grateful for that hon. member’s grasp of the problems of my department and for the positive attitude he has displayed. I just wish to tell him that I shall find a solution in Mayfair, too—with his assistance. [Interjections.]

The hon. member put forward a very interesting suggestion in respect of a service levy. He suggested that the service costs of a house should not be paid by the purchaser in a lump sum, thereby placing an additional burden on him. He said that it should rather be recovered over a period of years, just as-one would pay off a bond. This is something really positive which I shall ask my department to study in depth. If they should feel that there is something in that which they could pass on to my colleague the hon. the Minister of Finance, who would then have to make a concession in this regard, I should very much like to do so.

The hon. member for Hillbrow discussed the housing shortage in general. He pointed out how, after the Second World War, mass housing projects were undertaken in many countries, particularly by local authorities. The hon. member was a member of the Johannesburg City Council long enough—he was also the mayor of Johannesburg—to know about the many projects undertaken by our Government after the Second World War, and particularly for non-Whites in this country. This certainly does not compare unfavourably with the rest of the world. However, I agree with him that the private sector should and must make a much larger contribution than they have until now in this regard. That is why this new approach is aimed at expecting more of them and at obtaining their co-operation. Therefore one of the tasks of Mr. Kruger, whom we have appointed, is to use his expertise to involve local authorities in the self-help and selfbuild schemes, as well as providing information in respect of the establishment of housing utility companies.

The hon. member for Maitland pointed out that last year we held a conference here in Cape Town where we informed prospective founders of utility companies. I gave the hon. member a brochure in which all the guidelines were set out. A promising number of utility companies have already been established in other metropolitan areas and I hope hon. members who have the ability and the time will also show their willingness to assist in the establishment of such utility companies in their own areas.

The hon. member also referred to township establishment and expressed the hope that the Venter Commission would find a solution in this regard.

The hon. member for Beillville—I have already referred to him—explained the motive behind this legislation. He also said that we were now linking the benefits of the Housing Act to the utility companies in that they no longer had to seek assistance through local authorities, but will be able to request direct assistance from the commission.

The hon. member for Umbilo also dealt with certain aspects of housing. I wish to tell him that I am extremely grateful for his positive contribution, by way of the practical assistance and his knowledge of this matter that he is making available to the housing utility company which has been established in Durban. The hon. member has acquired a wealth of knowledge on local management over the years, and the fact that he is serving on the board of directors of that company reassures me that things will move in the right direction there.

The hon. member had a few problems in respect of the 10 year period, which I have already dealt with. He also said that people should know what they were letting themselves in for when they purchased a house. I might remind the hon. member that I said in my introductory speech—

Thus people will know what they are letting themselves in for when they purchase a house, since it will be set out in the contract.

There is a further important aspect to which the hon. member referred and that is the share the small business and the small builder have had in the provision of housing since the Second World War. I agree with him wholeheartedly that they have made a tremendous contribution. Our whole effort is aimed at once again giving those people an opportunity and a place in the provision of housing.

The hon. member for Green Point spoke in very broad terms about aspects of rental, which are not really relevant here. I do just want to tell him that we agree with him that the income limit of R650 is no longer realistic. Therefore I wish to announce that from 1 July this year the income limit will be increased to R800. This will be done by way of a proclamation which I shall have issued. [Interjections.]

I have already reacted to the speech of the hon. member for Maitland. Of course, he has practical knowledge and he spoke on the basis of this practical knowledge. He has come a long way with Garden Cities, where he has done very fine work. In fact, I want to say today in the hon. member’s favour that he is one of the hon. members who has convinced the Government and myself that we should make more use of utility companies in solving the problems of people in a certain category. I thank him most sincerely for this.

The hon. member asked us to repeat the symposium we held last year. I think we should establish an association of housing utility companies. When there were only two, it was difficult to establish an association, but now there are many more. An association should be established now, and then I think they could meet on an annual basis to impart their knowledge to the new ones which are added each year.

The hon. member also pointed out the important role which building societies could play if we were to grant them certain concessions and grant them certain powers. The purpose of building societies is—and, in fact, this was stipulated by the Government at the time—to provide housing. I agree with the hon. member. I think the hon. the Minister of Finance is trying to see what he can do on that score.

The hon. member for Johannesburg North made a very positive contribution. I am surprised that as a young member he is so knowledgeable about housing. In his part of the world I have quite a lot of problems with those flats of his. We can speak about that on another occasion. At least he concedes that this measure will contribute to alleviating the shortage in respect of people in urban areas such as Johannesburg—there the shortage is acute. He supports this measure from that point of view.

I thank all hon. members for their support. The clock has struck, and I think we can now regard the Second Reading as having been disposed of.

Question agreed to.

Bill read a Second Time.

Bill not committed.

Third Reading

Mr. Speaker, I move, subject to Standing Order No. 56—

Mr. Speaker, I take this opportunity to thank the hon. the Minister for dealing in detail with the points raised and providing additional information. He has correctly said that this debate has ranged wide. I think, however, that the hon. the Minister could have expected that, because every unit that is built by a utility company in terms of this legislation is a home for another family, a roof for another family and a further discharge of responsibility to the public in the private sector. So I think that he could have anticipated that the debate would range very wide.

Secondly, I think the hon. the Minister in his reply made a very important announcement, namely that somebody from outside will be appointed to do the co-ordinating. I think he said it would be Mr. Krige. That sounds like an excellent suggestion. I take it he will be a kind of housing ombudsman. Is that the general idea?

No, he will be the leader of the project.

Well, I think one needs that quite specifically in order to go ahead with what is, as the hon. the Minister said, really the experimental stage.

The hon. the Minister has allayed two of our most important fears or difficulties and hence we did not need the Committee Stage. I refer to the question of the extension of the period from 5 years to 10 years and the question of the proportion that is to be deducted. We accept the explanation given by the hon. the Minister for extending the period to 10 years on the basis of the existing powers of exemption contained in section 21(7) of the Housing Act as well as in section 56 in terms of which the commission may after consultation with the local authority concerned, grant such exemption. In view of it being an experimental stage, in view also of those powers of exemption and accepting the hon. the Minister’s explanation that the period will be a maximum of 10 years so that any type of case that arises can be met, however urgent, we accept that. The hon. the Minister will obviously bear in mind that whenever a person moves out of one place he has to go into another and if he is to buy another place, he will need the money. What is more, the longer the person has been there, the more money he is going to require to go into a new place because of the escalation of values, particularly at a time like this. So, as I have said, we thank the hon. the Minister for his explanation and accept it.

We trust that the utility companies will be formed, because the most important thing is to motivate the people. We know that quite a lot is being done as far as housing for Whites is concerned. We therefore have to concern ourselves more particularly with housing for Blacks, Coloureds and Indians. I sincerely trust that this will also motivate utility companies to provide housing for those particular groups. As regards the Black population group, whose need is the greatest of all, I hope that the big corporations which employ many Black people will themselves initiate, and get together to form utility companies to supply housing. Their motivation will be that they will be supplying housing for their own employees.

When it comes to the supplying of housing for Blacks, there may be other problems. There is the 99-year lease. If one wants to get utility companies and the private sector interested in supplying houses, I think one must think in terms of freehold title for the Blacks. The more definite freehold title is, the more definite will it be that utility companies will be willing and able to provide proper housing.

Then, of course, we have the Coloureds and the Indians. I see that provision is made for the delegation of power in terms of clause 6 of the Bill which provides that a local authority will in fact be able to delegate power to another body as well. I take it that this means consultative committees, management committees of local authorities and the representative committees of the Coloureds and the Indians. I understand, too, that they in turn will take the initiative where powers are delegated to them to encourage utility companies to come forward and provide houses for the Coloured people and in the case of the Indian consultative and management committees that they too will encourage people to provide housing for their people.

There is only one point that I wish to make with regard to the discretion clause where we are leaving it to the housing utility company and that is that we may have to insist that there be a form of uniformity. We do not want one housing utility company competing with another by providing better terms and conditions than the other. Obviously every unit that is going to be supplied is going to be most welcome, but in order to make people feel more secure there should be some uniformity. Perhaps the suggestion made by the hon. the Minister with regard to one-fifth, one-half etc., may be a good one. Therefore we wish Mr. Kruger success, we wish the hon. the Minister success and we hope that this legislation will be a giant step forward towards providing housing accommodation in order to fill the need that is so sorely felt by all communities in South Africa today.

Mr. Speaker, this is surely an important day in the history of this House because the hon. the Minister with reference to the Bill which he introduced summarized in a nutshell, not only in his Second Reading speech but also in his replies to hon. members, that with the new housing policy of the Government—which he again spelled out in general terms here this evening, but which was also dealt with in detail during the Second Reading of the Appropriation Bill—that with the introduction of this Bill he was completing a process that would create a situation in South Africa that could be compared with a Copernican change which was being introduced throughout the entire spectrum of housing in South Africa. For the first time it is now possible for every economically active citizen in this country who is worth his salt and who works and who is prepared to save, to purchase a plot of ground and acquire a home of his own. I think this is wonderful. The hon. the Minister referred to the seminar held in November 1982, namely the seminar on housing associations, on which a wonderful guide has been made available by the department. The philosophy of these utility companies is to give those people who are not primarily interested in a house, an opportunity to have a home of their own. However, there are people who have been categorically classified as people who qualify for the type of housing which utility companies, which in future will be freely built up from scratch, can provide.

This evening I want to predict that when we look back on this debate in years to come, to the policy of the Government and to this Housing Amendment Bill, we shall see that as a result steps were taken to lay the foundations for peace and prosperity in South Africa. I have already mentioned that a house is now being put within reach of every economically active citizen in South Africa. I also maintain that every person has certain basic needs. These basic needs can be reduced to three facets. These are, namely, that a person needs to eat, to sleep and to have his say.

The need to eat requires that one must work; that one must therefore be economically active. In order to sleep, one needs a roof over one’s head. This means that one should have a house or home. Most important, of course, is to be able to talk, to have a say in those matters dearest to one’s heart.

Through this housing legislation, as well as through the policy of the Government, these three basic human requirements have been met. In conclusion, I want to make an appeal to all organizations, institutions and bodies, as well as individuals, to make use of this opportunity to acquire a home of their own. I am also thinking of so many young people throughout the country who think nothing of spending a few hundred or a few thousand rands on a motor car or a motor cycle. I am also thinking of national servicemen who save thousands of rands over a period of two years. They should rather purchase a plot of land with that money in order to make a start in providing a home for themselves. I want to tell young people outside that one does not impress anyone with a motor car. It is far cheaper to impress a girl by sprinkling a little petrol in one’s handkerchief, and thus giving her the impression that one does in fact own a motor car. On the other hand, one could use that money to provide that girl with a proper roof over her head one day.

Mr. Speaker, I want to thank hon. members for their support for this legislation. I want to thank the hon. member for Hillbrow, who pledged his support for the legislation on behalf of the PFP. He touched on two new aspects. The first concerned the delegation of powers which may now also be made to officials of management committees in Coloured and Indian residential areas. I feel it is essential for those people who deal with housing for their people every day, to have a share and a say so that they can also gain experience in local authority matters. In addition, the hon. member also said that he hoped that there would be uniformity in connection with the benefits offered by utility companies.

Utility companies are usually locality bound. It is true however that within a specific area, for example here in Cape Town, there may be more than one company. I agree with the hon. member in this connection. Companies should not compete with each other within the same area as far as the benefits they offer are concerned. The commission will also go into this when it receives applications in this connection.

The hon. member for Brits also made a very positive contribution. I want to thank him most sincerely for this. The hon. member referred to the complete change which has taken place in our approach to the provision of housing. I agree with the hon. member. This is true, and I hope that it is going to succeed, because in my heart I believe that we are taking realities into account. In the second place, I believe that we are doing something that is practical, and that we are striving for attainable goals. For that reason I believe we shall succeed.

Question agreed to.

Bill read a Third Time.

Mr. Speaker, I move—

This Bill is consequential to the Housing Amendment Bill and contains similar principles. The underlying idea is to bring about uniformity with regard to the resale of property by owners who have benefited from State assistance in purchasing that property.

†To this end it is proposed that the Community Development Board’s pre-emptive right be extended from five to ten years and that provision be made for a portion of the selling price of a property, sold within the pre-emptive right period, to be paid to the said board.

Mr. Speaker, as the hon. the Minister indeed said, this Bill is a consequential Bill—it follows the previous piece of legislation which we dealt with—and we shall accordingly support it.

†Whilst we are dealing with this question of housing in South Africa, however, I do believe that it is important for us to deal with one aspect of housing that has not yet been dealt with in the discussion of these Bills, yet which I believe is a matter of some importance to South Africa, because over the years a mechanism has been created for providing housing for people which—with the sale of the approximately half a million houses envisaged in terms of this legislation—would give new importance to this building society movement if we could make use of the experience of those people.

There have been two important reports on the building society movement in the last few months. One was the Du Plessis report and the other was the De Kock report, although the De Kock Commission is an ongoing commission looking into monetary policy. I do not want to deal with the monetary aspect, but I do believe that it is important for us to consider building societies. The hon. member for Maitland raised the question of the building society development project. I think that is a controversial area, and I think building societies could often find themselves working in the upper level of the housing market and—by virtue of their loans—providing housing that is more expensive. In that regard I think it is interesting to see what the Beeld said on 30 April 1983. In the Press report mention is made of a building society, and this is the interesting part—

This refers to a building society which has lent R60 million within only five months—

That means that loans are being made, in this case, at the upper level of the market. The principle of the Bill before us now, a Bill which deals more specifically with houses sold with the aid of Government funds, is that the hon. the Minister proposes to sell some 500 000 houses, most of which are to be financed with Government loans. He is therefore introducing a ten-year limit, instead of a five-year limit or option, on occupancy. So the Bill is concerned with the question of housing of that nature. [Interjections.] Let me just interject here by saying, Mr. Speaker, that I shall not be keeping you more than another five minutes. I am sure the hon. the Minister is tired of listening to me. [Interjections.]

The Du Plessis Commission makes the following point—

They are, of course, the people who will benefit most from these houses the hon. the Minister intends to sell—

Reference is being made here to the building societies—

The De Kock Commission says the same thing, namely—

The point I wish to make to the hon. the Minister is that he is planning to sell 500 000 houses, most of which will presumably sell at R20 000 or less. Here we have a building society proudly telling us that it lent money on a average value of R50 000 per house. What I believe the hon. the Minister ought to do is that he and his department ought to take an interest in the reform of the building societies. I believe that it would be a tragedy if our building societies were to lose this trust of being mutual thrift societies. What did they originally start off as? Workmen got together and formed savings clubs to build themselves houses. That was the origin. The poor people in the society got together. This is recognized quite clearly by the De Kock Commission. I quote—

That is the Minister of Community Development basically—

It then goes on to make certain suggestions. I simply wish to make a plea to the hon. the Minister, who I believe has shown himself to be very open-minded, together with his department, in edeavouring to deal with the housing problems of South Africa. I think it would be a shame if the building societies were seen only in monetary terms and not be used for what they traditionally were, namely mutual thrift clubs or organizations, in many cases terminating building societies, to assist in providing homes for the lower-income group people. I simply wish to raise that point with the hon. the Minister because I believe that is another avenue which he could exploit. It does not involve his department as such but he could get them involved. However, before that can be done we need to have secure freehold title. That I believe is important. I want to urge the hon. the Minister not to allow this matter simply to be left to the hon. the Minister of Finance, because I believe it is a housing matter as well.

Mr. Speaker, I do not really want to react to the speech of the hon. member for Pietermaritzburg North. In his reply to the second Reading of the previous Bill the hon. the Minister mentioned that hon. members had digressed somewhat. With all due respect, I think that the hon. member for Pietermaritzburg North digressed even more as far as the provisions of this Bill are concerned.

He made quite a detour.

My hon. bench fellow is quite justified in saying he made quite a detour. These seem to me to be aspects which should have been raised during the discussion of the previous legislation.

As the hon. the Minister indicated, there is actually only one new principle contained in the Bill, and that is to bring the legislation into line with the provisions of the Bill which has just, after very thorough discussion, been accepted by the House. The new principle embodied in this legislation is that persons making a profit out of the sale of their property may be ordered to pay a portion of that amount to the State. I want to dwell for a moment on the concept “State”. It is never popular to have to pay something like tax to the State. This is never a popular idea. But we have to remember that the State has certain functions to perform and that in fact it only has one source of funds, namely the taxpayers. When one therefore refers to funds of the State, one is actually referring to taxpayers’ money which they make available to the State to the benefit of taxpayers in general. In this particular case we should remember that nowadays everyone is a taxpayer, because the State obtains its revenue not only from income tax but also from sales tax. Everyone is therefore taxable and everyone contributes to the funds of the State.

I do not think the Minister need make excuses when he says that people who are benefitted by the actions of the State, the taxpayer, have to pay back a portion of that benefit to the taxpayer.

In existing legislation provision is only made for a pre-emptive right. Over the years this have proved to be inadequate, and now, besides a pre-emptive right, the right is also being granted to issue an order that the person who sells and benefits from that transaction has to pay a portion of that profit one to the State, in other words, to the taxpayer.

I should just like to dwell on this for a few moments. As was the case in the previous legislation, there are no provisions in this Bill, either, regarding what amount will be claimed or under what circumstances money will be claimed from the purchaser or the seller. I think this is a good thing. In a previous debate the lack of prescriptions was criticized, but I do not agree with that criticism. I think this is being handled correctly. It is obvious to me that there will be a variety of cases and that each will have to be assessed on merit before a fair conclusion can be reached.

I want to suggest that one principle which ought to apply is that if the property is sold at a price lower than the market value, i.e. if it is sold at a loss, the board should purchase it. Over the years the general trend in the housing market has certainly been for there to be an increase in prices. I think that if a house is sold for less than the market value, it will certainly be possible later, perhaps in one, two or three years’ time, to sell it at a profit. I think that if the property is sold at an exceptionally low price the board should purchase it; even if for no other reason than that the board wants to retain that property for the benefit of those people the board primarily wants to benefit, namely people in a certain income group.

I should like to point out another benefit. In order to illustrate this clearly, let us assume that a buyer purchases the property for, say, RIO 000. As we know this is a favourable price. Let us assume that that buyer sells that house within six months for R12 000. I cannot arrive at any other conclusion but that it would be fair under such circumstances for the seller to pay R2 000 in tax to the State, to the taxpayer. After all, those funds will be used to assist those persons that the State has an obligation to assist.

Using the same example, let us now say that that man spends R2 000 on the property after he has purchased it and that then resells it within six months for R12 000. I am of the opinion that this is also a case of his having sold that property at an exceptionally low price and the board would be doing the right thing to purchase that property. In my opinion this is one of the principles which may be laid down in the regulations.

One can, however, go further than that. Say, for example, the owner of that house sells it for R14 000 a few years later. The situation is that the original purchase price was R10 000 and that in the year after he purchased the house, the man effected improvements valued at R2 000. He then sold the house for R14 000 two or three years after that. He therefore made a profit of R2 000. In my opinion it would be fair not only to deduct the amount of actual expenditure by the seller but that the amount he actually spent should be brought into line with the inflation rate. In my opinion it should be-calculated not only that the buyer spent R2 000, but because he spent it in the second year after he purchased the house, that amount should also be brought into line with the inflation rate during those two or three years. Let us take 10% per annum as an example. It can therefore be calculated that after two years the purchaser actually spends R2 400 and that he would therefore have to pay the difference between R12 400 and R14 000 to the State. However, because of period of time elapsed during which the buyer had to maintain that house, it would only be fair if he could keep a percentage of that profit for himself. If a buyer were therefore to sell the property after two years he should be able to pocket part of his profit instead of having to pay the entire amount over to the State.

There are also many other considerations which I feel should also be taken into account, but I do not intend to deal with them. In my opinion it would be correct if there were a degree of elasticity and discretion built into the regulations. If this discretion is not exercised properly the regulations can always be amended.

It gives me pleasure to support this legislation and I want to congratulate the hon. the Minister on it.

Mr. Speaker, I think we would be justified in saying that this legislation is merely a consequential adjustment following on the previous legislation we have already discussed. This legislation also provides that the period is increased from five to ten years. We also find that the envisaged new section 18 D(8) will provide, inter alia, as follows—

If we review these provisions we see that this is a measure to hold people to the pre-emptive right. The objective of this legislation is to allow people who have never purchased a house before, to purchase a house. No one expects exceptional profits to be made or exceptional business transactions to be entered into. Nevertheless it must be stressed that anyone who might want to do this can be prevented from doing so.

There is another matter I want to set straight. The hon. member for Pietermaritzburg North said that building societies cannot give bonds because there will not be full title—this is not freehold, but leasehold. In the entire southern part of Johannesburg there was leasehold under the old British laws. The same applies in Newton. In all those places leasehold still applies. Take the Durban beach front area as an example. There leasehold also applies. However, this has never prevented a building society from granting loans. I therefore hope that building societies will not discriminate merely because the people involved may be Black. I do not know whether that was the hon. member’s argument, but I do not think they will do so.

No, it is a legal problem.

But it looks to me as if it is a political problem as well.

*There is a question I want to put to the hon. the Minister, but while we are on such a friendly footing, I do not want to cause an upset. We are here discussing legislation which does not exclude any area. Does this mean that the people here in the Western Cape may also purchase houses in terms of these contracts? [Interjections.] No, I am not referring to a homeland now.

Do you mean the Blacks?

Yes.

The hon. the Minister will reply to that.

I should like to know, because the Bill does not make provision for any exclusions. I would appreciate it if the hon. the Minister would give me a reply to this.

Mr. Speaker, I thank the hon. member for Langlaagte for supporting the Bill.

The Government is willing to learn from the past. It is a well-known fact that the Government has done a tremendous amount in the field of housing in South Africa. In the seventies, many of our constituencies benefited greatly from the Government’s housing efforts. In my constituency there are large areas which were built under the national housing scheme. In those days many attractive houses were provided in reasonably large numbers. Basically, they were good enough for any decent person to live in. The houses were sold at about R5 000, with a maximum price of R6 200. It was then that we learned how the laying out of a neat lawn, the planting of a few shrubs and a shady tree, the building of a pathway in front of the house, the laying of paving, interior decoration and eventually minor additions, turned such houses into residences which one cannot buy today for less than R40 000. In that way we gave many thousands of people in our country decent housing which, in the course of time, they converted into a source of real pride for their families.

We also learned the following from this. When, in 1980 and 1981, the economy was on the crest of the wave and the prices of these same houses skyrocketed to their present level, many home-owners were tempted to do something which backfired on them. They were tempted to sell their houses at these attractive prices. Some of these same people are now on the streets. They are again standing in line. They were unable to resist the temptation and the five years had passed. I want this placed on record because we shall want to look at this again one day. Now they are again standing in line and the State has to provide them with housing.

When that man eventually had that sum of money—a wonderful sum of money in comparison with what he had invested—in his pocket, he found that after he had purchased a plot of land, there was very little left to build a new house with. If he took that sum of money and bought a house of his choice, he was saddled with an enormous monthly debt, which threatened to strangle him. Eventually he had to sell that house under pressure, sometimes at a loss. There were many people who landed themselves in trouble in this way.

As far as I am concerned, there is a second leg to this legislation, and that is that the State, whether it does so by way of legislation or regulation, has to compel a person to keep what he has for at least 10 years. When he is in a better financial position—and this was mentioned by an hon. member with reference to the previous legislation—then he wants better housing. However, if we look at the old 1970 scheme, we see that with improvements, plants, etc. the people created beautiful houses for themselves in these schemes. Today these are sought-after areas and indeed, they are places which are a source of pride to the community which developed them. I should like to support this Bill.

There is something we should learn from this situation. When a person sells his house within 10 years, the board should give careful consideration to whether it should not reclaim that house. Is our problem not that houses at a certain price level are the houses for which there is a demand in times of need? I am not suggesting that the board has to purchase those houses. I am merely saying it should carefully consider whether it should not reclaim that house to meet the demands of the time.

A second matter which is troubling me a great deal is that although there is this demand for houses, the private sector have not become builders of houses, but purchasers of houses which have already been built. For example, they have purchased some of these houses. If the private sector wants to make a contribution in times of housing shortages, it is pointless their paying funds into the pockets of existing home owners, while the State, by means of all kinds of companies and forms of support, has to provide new houses. If the private sector want to make a contribution they must become home builders.

It gives me pleasure to support the legislation.

Mr. Speaker, I have no wish, neither do I think it necessary, to create a magnum opus for this Second Reading debate. This Bill is basically consequential upon the previous Bill and, in fact, having passed the previous Bill, it would be illogical of us not to introduce this amendment.

One point I should like to make is that I find it terribly difficult, as the spokesman on housing matters for my party, to work with this hon. Minister and the hon. the Deputy Minister, because, despite our process of conflict politics, I find it very hard to have a fight with them because, over the period I have been working with them, I have found that, when one presents them with a reasonably decent idea, they are amenable to accepting it. [Interjections.] We in this party are therefore quite prepared to accept the Second Reading of the Bill.

Mr. Speaker, the hon. member for Pietermaritzburg North mainly discussed matters which did not actually concern this legislation, but which were nevertheless interesting. Of course, the reports of the De Kock and Du Plessis Commissions, that investigated building societies, are very important from a housing point of view. Therefore it goes without saying that the department and I studied this legislation in depth and scrutinized very carefully all aspects concerning housing. I am also able to say here that the concessions made by the hon. Minister of Finance in his budget this year are linked to and in accordance with certain proposals of this commission. The hon. member asked us not merely to leave it to the Department of Finance to effect reform within the building societies. I do not know whether reform is necessary to enable building societies to achieve more effectively the purpose for which they were established, but the department will naturally make its contribution. Until fairly recently, the building societies were virtually the only financial institutions in South Africa providing Whites, with housing loans. They have been responsible for a very high percentage of the financing of White housing. One cannot, therefore, simply throw the baby out with the bathwater. As the hon. member said, we shall not let the grass grow under our feet as far as these reports are concerned. I also want to thank the hon. member for his support for the Bill.

The hon. member for Port Elizabeth North rightly pointed out that the money now flowing back in the form of levies, to the various institutions that make the housing available is, after all, being used for new housing, which is an excellent and praiseworthy object. The hon. member suggested that if prices were particularly low or below the market value, the board should not let such an opportunity pass but should purchase the houses. The hon. member for Brentwood also said that we should think twice when such houses appear on the market. The fact is, however, that we do not have the money to buy up houses. That is why we are going in this new direction, and that, too, is why in the past, where there was a pre-emptive right in black and white, it was virtually never exercised. We simply lacked the money to purchase the houses. But of course the board does have the right to do so, and if it is a bargain I think that the board would go out of its way to follow the advice of the hon. member.

As regards improvements which should be taken into account in determining the profit, I have already spelled out in my previous Second Reading speech that ample pointed will be made for improvements when the profit is determined. It is of course a principle that is embodied in the legislation that the longer a person resides on the property, the bigger his share in the profit must be.

The hon. member for Langlaagte pointed out that this was a consequential measure and that certain principles have to be complied with by way of instruction before properties could be registered. This is true. The hon. member then asked a question in connection with the sale of houses to Blacks in the Western Cape. Unlike the Housing Commission, the Community Development Board does not provide housing on a large scale. As we know, the Community Development Board was established to purchase properties from unauthorized persons in an area after it had been declared a group area, and to transfer that property to other persons. The Community Development Board therefore has to act as an agent of the Government to transfer property being occupied by unauthorized persons, to authorized persons. It is therefore only by way of exception that the board undertakes projects. The board does not undertake Black projects with its own funds. This therefore is not relevant as far as the legislation under discussion is concerned. Provision is made for housing for Blacks in terms of other legislation.

In his entire speech the hon. member for Brentwood merely indicated why this measure is necessary and why it should be placed on the Statute Book. I have already dealt with a few of the statements he made. We shall take due cognizance of the suggestions made by the hon. member.

†I wish to thank the hon. member for Umbilo for expressing the support of his party of this measure.

Question agreed to.

Bill read a Second Time.

Bill not committed.

Bill read a Third Time.

Mr. Speaker, I move—

This Bill is a further step in the rationalization process of our laws. All the laws dealing with the same subject, namely the donation of human bodies, tissue and blood, and the disposal thereof, are consolidated in this Bill. The powers and functions currently dealt with in the Anatomy Act, 1959, have also been transferred from the Minister of National Education to the Minister of Health and Welfare.

Since this Bill is mainly a consolidation measure, modernizing various laws, I shall not elaborate on its provisions. I do wish, however, to invite attention to a provision in the Anatomical Donations and Post-Mortem Examinations Act, which is scientifically untenable, and which is now being rectified. According to that Act,“gonad” means the human tissue of group of germinal cells essential for the reproduction of the species. This means either the organ producing the spermatozoa or ova, or the spermatozoa or ova themselves, a definition which is scientifically incorrect. For this reason distinction is made between “gamete” and “gonad”.

It will also be noted that an artificial insemination is prohibited unless the person effecting such artificial insemination complies with a code of practice published by the department. The code, compiled in co-operation with the medical profession, was approved by the National Health Policy Council, and is freely available from the department. In regard to the donation of pituitary glands, I wish to invite attention to the production of growth hormone in South Africa. The department is producing the hormone at approximately R4, 50 per dosage, and the patients receive it free of charge.

There are at present 42 patients receiving the hormone produced by the department. In comparison the price of the imported product was R74 per dose, 18 months ago. According to reports our product is very effective. It is therefore, to say the least, very strange that there are still numbers of medical practitioners who insist on prescribing the imported product for their patients.

The tissues donated during 1982 are set out on page 48 of the annual report of the department. From this it will be noted that only 728 eyes, 195 kidneys and 93 hearts and heart valves were donated, which is far too little to satisfy the need. The transplanting of tissue can save human life, alleviate pain and suffering or improve the quality of life. With the donation of tissue, which is of no use after death and which can be used for transplantation, an act of mercy is performed in many cases, which will always be remembered by the person receiving the tissue. I therefore again wish to invite the attention of our people to this great need and to urge them to provide for the donation of tissue timeously. I am of the opinion that the general terms of the Bill, in relation to those of the present laws, are much improved.

Mr. Speaker, I should like to say a few words about this Bill this evening. We have been waiting for quite some time for this piece of legislation to come before this House. I was one of a group of doctors, nurses and other members of the medical team who spent many a long night waiting—from early in the evening till late the next morning, sometimes for longer than 12 or 16 hours—for a patient to be certified dead, for relatives to come to the hospital to sign the necessary forms. Often we also waited for district surgeons or for blood and many other things. Sometimes it became so late that by the time the transplant had to be done we were very tired. It is also late in the evening now, but the hon. the Minister has at long last donated this Bill to us, this Bill for which we have been waiting for so long. I think this House has to decide this evening whether it is going to accept or reject this donation.

I must say that we on this side of the House welcome this Bill and will gladly support it.

†The first obviously good thing about this Bill is the title itself. It is called the Human Tissue Bill. In the title use is not made of words like “anatomical” or “post-mortem examinations”, words which are not really part of what it is the intention to convey. When we refer in future to the Human Tissue Act, everyone will know that we are talking about human tissue, because everybody knows what the medical profession needs human tissue for and what can be done with it. So I want to congratulate the hon. the Minister for the very fact of having named this legislation the Human Tissue Bill.

The long title is also very interesting because it defines exactly what is being talked about. Why, for example, does one need human tissue? One needs it for “medical or dental training, research or therapy”. In general that is what the world needs human tissue for. We are given details about the dead donor, the living donor and what the tissues can be used for, as well as other regulations in this regard. The hon. the Minister himself mentioned a few.

There is no doubt that the human body is a very valuable asset to the human being. I do not think we realize strongly enough the importance of the human body. We do, of course, need the human body in order to be able to practise medicine. Without it we cannot do so, but it is only recently that we have come to know the importance of the utilization of the human body. Another use relates to teaching. We all know how medical students have to do dissection. I remember how we, as second year students, started doing dissection. We were somewhat nervous, somewhat frightened and some of us wanted to faint. We nevertheless had to go ahead and do our dissections in order to obtain an overall understanding, a complete understanding, of the anatomy of the human being. This is absolutely essential in a doctor’s training. It can be of use in research. Factors such as the physiology and pathology of the human body, blood chemistry and the acid base balance can only be properly studied and finalized by actually doing research and experimentation on the human body.

The human body can also be used for therapy. The best known example of course is blood transfusion. Blood is transfused from one human body to another. It not only has a therapeutic value, but in many cases it is also life-saving. That is why it is so important that all human tissues are grouped together so that we can use them.

Medicine is a science and has experienced an explosion of new developments over the past few decades. When the hon. the Minister and I qualified many years ago the only antibiotics that were available were sulfa drugs and penicillin. Today there are so many mycins that one cannot remember every one. Treatment with corticosteroids was experimental in those days. Today everybody uses them. Unbelievable advances have been made. One need only think of the advances in the field of X-rays surgery and transplant. Medical science is a fast developing science and we in this House—I am proud to be here—have to keep pace with these developments to make it legal for the doctor to carry on with what he is doing. This Bill is a very good example of that.

We can also think of corneal transplants to make blind people see again. I believe there are more than 30 000 blind people in South Africa. More than 15% of blindness is caused by corneal disease.

We can also think of kidney transplants. We have all seen people suffering from renal failure. These people are linked to a machine and need dialysis twice a week. This can also be done by dialysis at home. However, it is expensive and there is no quality of life. A kidney transplant can prevent kidney failure and restore a person to an active normal life and give him the opportunity to become part of society again instead of being a hindrance and a burden. Because of this he is enabled to make a contribution to society.

The first kidney transplant in South Africa was performed in the constituency that I represent in this House, Parktown in Johannesburg. The first kidney transplant performed in Cape Town was carried out by the surgical team of which I was a member and which also did the heart transplant. We started off in 1977 with a kidney transplant on Mrs. Edith Black. She is still alive today. That just shows what can be done.

One often finds that a person with total cardiac failure is bed-ridden. I have seen some of these people who cannot shave without getting out of breath. By means of transplanting a heart from another human into his body one can achieve results, although perhaps not the results which one would have hoped for. We do, however, succeed in giving people a better quality of life again.

I do not have sufficient time to do so, but one can also talk about test-tube babies and other most recent and exciting advances in medicine. Without the human body these advances would not have been possible or would have been delayed. The law, especially the law in South Africa—in this regard I want to give the hon. the Minister and his predecessors credit—has had to be changed repeatedly to keep pace with medical progress and to keep the medical profession within the law. The Bill passed in 1970 dealing with anatomical donations and post-mortems was used by the rest of the world to make transplants possible. This is again the case with the Bill before us now.

The rapid development since 1970 in medicine especially in the field of transplants, as well as other fields mentioned by the hon. the Minister, has made it necessary for numerous pieces of amending legislation to be introduced. Before 1952 there was no statutory provision regarding the removal of tissue from the bodies of dead or living persons for therapeutic purposes. We could only use bodies for anatomy. The development of corneal transplants changed this and from 1952 the use of human tissue for therapeutic purposes was accepted in the laws of our country. Kidney and heart transplants followed corneal transplants and, as I said before, this House debated and passed the Anatomical Donations and Post-Mortem Examinations Act in 1970. It is very interesting to read the debate which was held in this House at the time when three doctors and three lawyers stated their viewpoints. In those days they argued about the removal of organs from dead people but today it is accepted that this is no longer a problem. After 1970 further amendments followed for the harvesting, as the hon. the Minister said tonight, of the pituitary gland at post-mortems. This is very interesting because one needs two or three pituitary glands for one dose. I think the hon. the Minister said that in South Africa we need 10 000 doses a year. I would like to support what the hon. the Minister has said about the making of this product in South Africa. The product is adequate and good and doctors should prescribe the product made in South Africa especially in view of its competitive price.

Afterwards there were more amendments concerning the importation and control of blood. This Bill now consolidates—and I think very successfully—the seven Acts and amendments dealing with this very important aspect of medicine.

I would like to use most of my time to deal with transplantation.

To obtain organs for transplantations we can use human bodies or the bodies of animals. In medicine we know this as allograft, coming from the human being, and zenograft, coming from the animal. In this Bill zenografting from animals is not included as for that we only have to sign the prescribed hospital forms. However, when we come to allografting, from human to human, there are, of course, many problems, real and imaginary, such as medical problems, ethical problems, moral problems and religious problems.

In this Bill we find that in clause 1, “tissue” is defined as—

1. (a) Any human tissue, including any flesh, bone, organ, gland or body fluid, but excluding any blood or gamete;

I do not like paragraph (b) of this definition very much but I have been told that it is legal to do it this way and I accept it. That paragraph reads—

1. (b) Any device or object implanted before the death of any person by a medical practitioner or dentist into the body of such person;

That will, of course, include a pacemaker, an artificial valve and so forth.

Probably a gold filling as well.

Yes probably a gold filling as well. This is tissue. If one reads very carefully, one will notice that the words “dead person” occur throughout this Bill because it deals with obtaining organs and tissue from dead people. However, the word “dead” is not defined and this, to me, is a problem. I am pleased to see the hon. the Minister of Posts and Telecommunications here because, when I look at him tonight I remember him watching me one night during a heart transplant operation. In a way, it is like coming together again to discuss the same problem. However, the word “dead” is not defined and when one reads the previous debates one sees that the Minister at the time said that this aspect should be left to the medical profession. I have approached the hon. the Minister about trying to define death in this Bill and I do not think he was fair to me because he did not come back to me. However, I will not let him off the hook tonight. I say this, Sir, because the question of deciding whether a person is dead or not may be left to the medical profession and the medical profession are the people who will have to take the responsibility if there is any misunderstanding in this regard. The hon. the Minister and any legal-minded people may correct me if I am wrong, but I do not think that the doctor is protected. The medical profession in South Africa is not protected, and I think that if any public prosecutor wishes to take us to court when we pull out the plug, we may find that we are not protected. I say this in all seriousness because I have made inquiries in this regard. I should like to ask other hon. members who participate in this debate to assist in solving this problem.

In the beginning there was no trouble because the public were made to feel comfortable. Film producers showed them how to diagnose death. There was the bad guy lying in the dust and the good guy would come along and put his finger on the bad guy’s pulse, usually in the wrong position! He would then put his ear against the bad guy’s heart, usually on the wrong side! He would then declare him dead. That was an acceptance of death. For his final diagnosis, he would lift one of the bad guy’s eyelids and then let it fall, and that was that. The public therefore accepted that the diagnosis of death was a simple one but, as a very important person who carries my surname once said: “Die pasiënt is dood wanneer die dokter sê hy is dood”. This sort of thing is acceptable in corneal transplants where one can harvest a cornea up to four hours, preferably two hours, after the death of a person, and the death certificate of that person is available.

Yes, but you want to find the moment of death, and that is more difficult.

Quite correct. Then, afterwards, when it came to renal transplants there was again no problem because one could actually wait until the patient’s heart had stopped. However, when we did the first heart transplant, we waited for the heart to stop. However, a doctor has a responsibility towards his patient and there is no doubt at all that if a heart is still beating properly, if it has not been damamged by anoxia, by low blood pressure, if it still has a sound physiological function, it is far better for the recipient. I see that such recipient is now to be termed “done” in terms of this legislation, and I do not like it. If I had to tell my friends that I was going to examine a donee, they would laugh at me. I am going to examine a recipient. That is what we say. However, I have again been told that this is a legal term and I shall have to accept it. I am just an ordinary doctor and do not understand the legal terms. Now, when we take out a beating heart, the public ask questions. They want to know what is going on. They ask: How can these people say that a person is dead when his heart is still beating? Next door to him there is a patient who has been lying there perhaps for a year and being kept alive. Because of all these circumstances, we try to define death—and I think successfully—as occurring when the brain is dead. That is brain death. Brain death is the accepted definition of death when reference is made to a still beating heart.

I should like to ask the hon. the Minister to comment on what I have said this evening because I believe that especially in regard to cardiac transplants, the doctor removing a beating heart needs to be protected. It is easy to diagnose the moment of death. The patient is deeply unconscious, his pupils are dilated, he has no reflexes, he does not respond to painful stimuli and, if one stops the artificial ventilation, the patient does not breathe spontaneously. Brain death can be confirmed by means of electro-encephalograms. Therefore, there is no problem. I want, therefore, to ask the hon. the Minister in all friendliness whether it is not possible to write this into the Bill for the sake of the doctor. I do not say this for myself. The doctors who are performing the transplants are worried and they would like some assistance in this connection.

Clause 2 makes it quite clear that if no near relatives can be found the district surgeon can, after a reasonable time, give consent for the donation. In practice this sometimes causes great difficulty because all district surgeons are not the same. Some are more reluctant than others and quite often a donation is lost because of the time factor. Especially in our country it is not always easy to find relatives who live far away. We go to great lengths, but unfortunately I cannot help the hon. the Minister; perhaps he can help me. I have difficulty with the phrase “reasonable time”. I appreciate that there is a problem in this regard, but I should very much like “reasonable time” to be defined more exactly. Can it not be coupled to a certain definite period of time? If that could be done, I think we would be able to harvest more kidneys and more hearts. We do not want to hurt anybody’s feelings; what we are trying to do fits in with what the hon. the Minister has said. We need more organs, more tissues, to be available for transplantation.

I now come to clause 3 which deals with the institutions to which, and the persons to whom, human bodies or tissue may be donated. This is a very important clause. I have no problem with the persons to whom bodies or tissue may be donated. They are medical practitioners or dentists or any person who requires therapy. This, of course, is very important, especially in the case of living donors because quite often a near relative donates a kidney. Such a relative can stipulate that he wants to donate a kidney to his aunt, for instance. The position with regard to people is therefore very clear.

As far as donations to institutions are concerned, this provision is of great importance. The clause provides that a human body or specific tissue can be donated to (a) a hospital, (b) a university or technikon or (c) an authorized institution. On the face of it this may not appear to be very important, but I maintain that it is very important indeed. For this type of operation to be done and procedure to be followed, it is imperative that we have control to ensure that the operation is done at places where it can be done properly, with the right assistance and all the necessary disciplines present to ensure that it is carried out in such a way that the desired results will be achieved and with an understanding of the problem. I cannot commend the hon. the Minister enough for having introduced this type of clear definition. When the previous amendment was introduced in 1970, everybody said that it was wonderful, but if one compares that amendment with the one which we have before us now, the present one looks like clear crystal glass while the previous one looks like a muddy pool. The present amendment reveals a clear understanding of the whole problem.

Clause 4 deals with the purpose of donations. The provisions of the clause are clearly stated. Donations are for the purpose of training or therapy. A donation cannot be used for any other purpose. I must therefore support this clause. A donation can be used only for the purposes stipulated.

Clause 6 provides that when a person at the time of his death is wearing a tag, such a person shall be deemed to have made a donation. In practice this does not work. I can tell the hon. the Minister that in practice when we find a person with a tag we never act upon it. We always look for the relatives. We really go out of our way to look for the relatives; if one does not, one can cause bad blood. It may be accepted in cases where the body is donated for purposes of anatomy or research, but when it comes to transplantation we do not want to act upon it. We follow a long drawn-out process. We ask the policeman; there is usually a policeman involved when an accident has happened. We ask the ambulancemen, we contact the neighbours—we really go out of our way to find the relatives. Simply to accept the tag can, in practice, cause problems, but I do not think there is any harm in stating the case in these terms.

This brings me to clause 10. In our situation in South Africa, this is a clause that could cause some problems. I have been approached by people about this clause, but I should like to assure the hon. the Minister that I support him on this. This clause deals with the disposal of bodies of deceased destitutes. Hon. members in this House may perhaps not know this, but many of the bodies that arrive at the medical school for dissection are the bodies of such destitute persons. What is involved here, is the time lapse between the death of the person and the decision that he is a destitute, as well as the time that has to elapse before the body can actually be used. I say this because—especially in our country—it could be days, weeks or months before a relative comes to claim the body. If a person is destitute that does not necessarily mean one can simply take his body and use it. It is provided in law that a near relative or close friend can claim a body for burial. So the use of the bodies of destitutes is not simply an automatic procedure. Under the correct circumstances, however, use can be made of such bodies. Usually notice—within 24 hours—must be given to the inspector of anatomy. This is just verbal notice. Written notice must then be given within 36 hours. He can then send the body to the medical school. The medical school then has to wait two weeks before the relevant body can be used. The organs may be taken out in the meantime, however, and preserved.

One only has to look at previous debates on this issue, especially speeches by the present NRP—the then United Party—to see that they had numerous problems in this regard. There was the question of the whole body having to be buried intact and things like that. Fortunately things have changed since those times. People have come more readily to accept the use of bodies for research purposes and for transplants.

I should now like to deal with clause 16. This is perhaps one of the clauses in regard to which I want to ask the hon. the Minister a few questions. I would not go so far as to say that I really have any difficulties as far as this clause is concerned. We can, of course, go into these aspects in more detail in the Committee Stage. Clause 16 provides for the prohibition of the use of gonads for certain purposes. As hon. members no doubt know, gonads are the ovaries or testes. As far as I know, present transplant methods in this field are not very successful. If they were more successful, however, for what purpose other than procreation would such transplants need to be done, and if such transplants were to prove successful, why can transplants not be done for procreation purposes? I have read the previous debates in which much was said about this, but that is not totally acceptable to me. Clause 16 deals with gonads taken from dead persons. When the previous Bill was dealt with, it was dealt with under clause 3 of that Bill. It was said—

That is really saying nothing at all. It would seem that there are quite a number of problems. What, however, are those problems? I would like the hon. the Minister please to outline them to me. I do have a certain idea. If gonad transplants were possible, and if a sterile woman’s only chance of pregnancy hinged on having the gonad of a dead person transplanted in order to make her fertile, I do not think we could stop that. I do not think that it is, as yet, a practical proposition, but if it were, I do not think we could stop it. If that is the only way a woman can have a child—perhaps the biggest gift to a woman—I do not think we can legally stop it. I therefore want to wait for the hon. the Minister to reply at Second Reading, and we can then discuss it at greater length in the Committee Stage.

In Chapter 2 of the Bill we now come to the living. This chapter deals with tissue, blood and gametes of living persons and blood products. In this Bill we see very clearly, from the definition, what a gonad and a gamete is. In the legislation of 1970 a gonad was defined as both. Now the generative cell and the body organ producing it are defined separately.

Clause 18 deals with the consent to removal of tissue and I have no problem with this. Clause 19 deals with the purposes for which tissue may be used and states in paragraph (c)—

The hon. the Minister was kind enough to show me the little booklet with regard to the code of practice for artificial insemination using a donor. I have read it carefully, I have studied it and I can make no other comment than to say to the hon. the Minister that in my opinion it is a very good book. I support it and I thank him for it. However, now another problem arises. A gonad cannot be transplanted for procreation, which is really to say that one cannot transplant a leg if it is used for walking. It is the same thing. I think the hon. the Minister will agree that that is not reasonable. It states that a gonad cannot be transplanted-for procreation, which means that legs cannot be transplanted for walking. For what other reason would one transplant them? It is stated that the donor and the recipient need the permission of the Minister. Why cannot it be the same as in the case of the gamete which is done according to the code as directed by the Department of Health and Welfare? It is the same thing, there is no difference. I should also like to ask the hon. the Minister to give us some more information about this in his reply to this debate. The only conclusion that I can come to with regard to this is that the factory is out of bounds, but one can use the product. This is what it says. To me this does not make sense and the hon. the Minister must please give us an explanation.

Clause 28 is a very important clause and it deals with payment. I believe that South Africa leads the world in that we do not accept payment for the donation of human tissue. When we look at our blood transfusion service in South Africa, which is recognized as one of the best in the world, the safest and the cheapest, we find that no payment is made. In other parts of the world such as America, payments are made for blood. Among others there are drug addicts who donate blood to receive payment so that they can purchase drugs. At the end of a day they pool all their blood. However, we in South Africa use our blood on a donor-for-patient basis. When blood is pooled it causes a higher incidence of infectious hepatitis and other types of infection. Therefore in principle believe that there must be no payment for tissue, for blood or for anything like that because it can lead to unbelievable abuse. The end result is usually bad because the donors are people who really should not donate. I do not know of any organization in South Africa that pays for blood and I should like to ask the hon. the Minister whether he is aware of any organization that pays for blood. Apparently there is no organization that pays for blood. If there are people who receive payment for blood, I think that one should do something about it. It should not be allowed.

Clause 33 is an important clause that deals with the prohibition of the publication of certain facts and it has been compiled from experience. The hon. the Minister will remember that the bedlam and nonsense that followed the first heart transplant were unbelievable. We did the heart transplant operation on the Saturday night and the Sunday morning and then we went home. On the Monday the whole world was at Groote Schuur Hospital. It was like a bazaar. One could not get on with one’s work. It was a sensation then, but the interest has died down now. I therefore support the provisions of this clause to the effect that the publication of the name of either a recipient or a donor may only be made if written consent is received from the parties concerned. I think this is very important and I therefore support this clause Anybody who is involved in this type of operation will also support it.