Mr Chairman, I would like to start by thanking the hon member for Pietermaritzburg North for the good wishes he expressed when he commenced his speech on the fact that I would be taking up another portfolio. I would also like to thank him for the kind words he expressed in regard to the contribution I made. Of course, I am not leaving Parliament. [Interjections.] Hon members should not worry themselves over this. I shall be back in a couple of months. I will be here to terrorise the governing party from time to time in my own way. Their good wishes however are appreciated.

Mr Chairman, for the past several years I have tabled questions in Parliament in an attempt to obtain a racial picture of the Department of Justice. My interest was aroused because of a comment contained in one of the reports of the Hoexter Commission of Inquiry into the structure of our courts in which the attitude of Black South Africans to the administration of justice was mentioned. I would like to share with hon members some of the facts that have emerged as a result of this questioning.

Firstly, the professional establishment of the department as at 31 December 1988 was as follows. The department employed 2 537 persons with legal qualifications in professional capacities. The breakdown of this figure is 2 409 Whites, 95%; 27 Blacks, 1%; 61 Coloureds, 2,5%; 40 Indians, 1,5%. In regard to the magistracy there are presently 144 regional court magistrates.

All these magistrates are Whites. There are 782 ordinary magistrates, of whom 768 are White, none are Black, four are Coloured and 10 are Indian. These Coloured and Indian magistrates are almost exclusively used in ethnic type courts such as Chatsworth, Verulam and Stanger. They are hardly ever, perhaps never, in a position to dispense justice to a White accused person.

There are 956 regional and magistrate’s court prosecutors. Of these, 847 are White, 27 are Black, 28 are Indian and 54 are Coloured. This, then, is the racial profile of the Department of Justice.

What of training in the department? As we know the department runs both functional and legal training courses for its employees. These courses are for instance related to the following: Deeds registration, Master’s courses, magistrates (civil), prosecutors, magistrates (criminal), clerk of the court, estate controllers’ courses and so on. In 1988 203 persons participated in legal training organised by the department. Of these 193, or 95%, were White, three were Coloured, three were Indian and four were Black. In the same year the following number of persons participated in functional training provided by the department: Whites 966, Coloureds 8, Indians 7 and Blacks 472.

Hon members can see it is patently obvious that the hon the Minister is hardly going out of his way to normalise the employment practices of his department. The face of justice presented to the public remains overwhelmingly White. In particular the Coloured and Indian communities play almost no role in this department at all.

Looking to the future, the training figures are not much better, with Whites enjoying over 60% of the places and Coloureds and Indians less than 5% between them.

I point this out for a very relevant and important reason. It was mentioned by the hon member for Sundays River yesterday but not followed through. It is a fact of life that if the administration of justice is to achieve credibility and legitimacy in the eyes of the community, then it must be an administration of the community. This can never be possible in a society where 90% of those brought before the court are Black and 99% of those prosecuting and judging are White.

I want to suggest that it is not enough to wring one’s hands and say that the department battles to find suitable recruits from the Black, Coloured and Indian communities. The hon the Minister must go out and find them. He must actively promote recruitment. He should be sponsoring legal education programmes in these communities. I honestly do believe that the hon the Minister should not sit back and say that there is little he can do. There is a great deal that he can do, and though the hon the Minister has done very little to redress the gross racial imbalance in his department as yet, all is not lost. He can start tomorrow and he must, because the very legitimacy of his department is at stake. People’s courts are not the answer to the future but people’s courts as they have appeared in our townships are an indication of community alienation from the system of administration of justice as we know it. If the hon the Minister does nothing, then people’s courts may yet take over because people’s courts should not be fought by suppression but rather by community involvement. Community involvement means among other things fair employment and training opportunities. I hope the hon the Minister …

Order! There is an undertone of hon members conversing in loud voices.

I hope the hon the Minister heeds this timeous and friendly warning.

I turn now to another topic. This is a topic which was also mentioned by the hon member for Sundays River. Once again he mentioned the topic, but he did not follow the subject through to its conclusion. Some years ago, at the request of the Law Society, the study of Latin was abolished as a prerequisite to becoming an attorney. In July 1988 the General Council of the Bar resolved at its conference that the study of Latin should be abolished as a prerequisite to qualify as an advocate.

The main reasons for this decision being taken were as follows:

Firstly, a single course in Latin at university never really qualified anybody to study or to interpret the ancient legal works.

Secondly, in truth the study of Latin was really no more than a sifting mechanism eliminating from admission to the Bar the less academically brilliant candidates and thus keeping the numbers down.

Thirdly, in practice this has made it just that bit harder for non-Whites to enter the profession— which is the only route to becoming a judge.

Hon members can consider the following. There are 846 White high schools in South Africa of which 73 offer Latin as a course to their scholars. There are 368 Black high schools outside of the homelands in South Africa. None of those schools offers Latin as a course at all. There are 133 Indian high schools in South Africa controlled by the House of Delegates. None of those schools offers Latin as a course. In regard to the schools controlled by the House of Representatives—the Coloured high schools—there is not one high school which offers Latin as a course.

How much harder do hon members think it is for Black, Coloured and Indian students, who have no background in Latin at all, to pass a university course in this subject than it is for White students who have at least had a chance of studying Latin at school for five years before starting at university? No, Sir, the current provision is an enormous stumbling block to students of colour who would like to study law and be admitted to the Bar. This is one of the reasons why the face of justice is as White as it is.

It is time that this unnecessary stumbling block, which has long fallen away as a genuine aid in one’s professional life, be removed. The hon the Minister who on 7 March 1989 gave to me what I would call a most timid reply to my query on this subject should cease to be so faint-hearted on this score. If the hon the Minister is too cautious—I grant him that he should be cautious in matters of this nature—to deal summarily with the matter, I request that the hon the Minister set up a joint committee of Parliament to investigate the subject and to report back to him as soon as possible. His proposal merely not to reinstate Latin I as a compulsory course for admission as an advocate is not the answer that is being looked for. The time for him to act is now.

Mr Chairman, the hon member for Sandton will have to excuse me if I do not react to his speech. I think the hon the Minister will probably reply to all his questions.

Firstly I should like to thank the Whips on the Government side very much for the fact that my speaking time was transferred from yesterday to today. They may well live to regret the fact that it was transferred to today because yesterday evening I was …

Order! I would like to appeal to hon members to speak more softly. There is a fairly obtrusive murmur. There are other hon members who would like to hear the hon member for Standerton. The hon member may proceed.

They may well live to regret it, because yesterday evening I was selected by the divisional council of the CP at Standerton as the candidate for the election which is to take place in the near future. [Interjections.] Not only was I selected, but this is the third time within two years that I have been unanimously nominated as the candidate for Standerton. That is an outstanding achievement. I think I am the first candidate to have been selected with a view to the election is to take place one of these days.

The NP in that constituency are still scurrying around in an effort to find a candidate to stand in the election. The previous candidate who stood there got cold feet and ran back to Witbank. Now they are engaged in a local search for a candidate they cannot find. [Interjections.]

Order! I assume the hon member’s speech has something to do with prisons! [Interjections.] Order! The hon member may proceed.

The remark by the hon member that I almost ended up in prison at the time of the first election, is entirely uncalled for. Perhaps he came closer to prison than I did, and I think a number of his colleagues belong there. [Interjections.]

Order! I know that the debate is being conducted in a light vein, but I do not think the hon member can say that a few of his colleagues in the Committee belong in prison. He must withdraw that.

I withdraw it, Mr Chairman.

I want to express my appreciation, and that of the CP, to the Department of Justice and the Department of Prisons, the Directorate of Justice and that of Prisons, and all the members for the exceptional service they have rendered during the past year. Permit me also to address a special word of thanks to Judges Harms, James, Van den Heever and the other judges. It was with great appreciation that we took cognisance of the investigations they are conducting and the valuable contributions they are making in this regard. We know that it is not always very easy to conduct these investigations, but we think that they are nevertheless rendering very good services in so far as this is concerned. We are indeed proud of our judiciary and I think that the attack by certain hon members and certain newspapers on Mr Justice Strydom is entirely uncalled for and that it has no place here. Criticism has been forthcoming from the ranks of the NP, and in this regard I am referring to criticism which was directed by the former hon Minister of Mineral’ and Energy Affairs, Mr Du Plessis, as well as from the former hon member for East London City, Mr De Pontes, at the findings of these commissions of inquiry. I wish to refer them to the Hansard of 31 July 1987, col 2763, where Mr De Pontes, when he was still a member of Parliament, said the following:

He went on to say the following in col 2764:

I hope that those hon members who have been the subjects of these commissions of inquiry will bear in mind what Mr De Pontes said.

On behalf of the voters of Standerton I want to thank the Department of Justice very much for the separate venue that has been made available for the regional court and the circuit court in Standerton. The old magistrate’s court no longer met the needs of the growing population there. I trust, however, that this new arrangement will only be of a temporary nature. The new courtroom is situated in a business complex next to one of the well-known shops at which quite a number of limpet mines exploded a few months ago. On the other side there is a liquor store. I think it is a very impractical place in which to accommodate a court, particularly a regional court and a circuit court. I trust that consideration will be given to the security aspects related to this, because there are now two courts that have to be looked after, namely the magistrate’s court and, a few hundred yards further away, the new offices of the regional court. Of course, this also results in administrative staff having to be made available, and I trust the department will give some attention to this. However, attention must be paid to the security aspects in particular. This is a very important matter, and one which I have touched upon previously. I ask that attention be paid to this.

I think it is time Standerton was given a new magistrate’s office in which everything could be accommodated so that the people would not have to be accommodated in offices all over the town. Whilst I am talking about the administrative staff of the magistrate’s office, I also want to make an appeal that consideration be given to their salary package. The professional officers can now breathe easily once again, but there is a great exodus of these administrative staff. These are people who have been well trained over the years and who are now going to the private sector. I want to request that we look after these people as well before it is too late.

The hon the Minister of Home Affairs also announced with great bravado that they were ready for the next election. I just want to ask who in actual fact always does most of the work for the election, particularly in the rural areas. Once again it is the magistrate and his staff who have to do all the work. Their help is enlisted and in a constituency like Standerton, where we shall be holding our third election in the space of two years, these people are being completely overloaded.

I think the time could well be ripe for us to consider the fact that the judicial and administrative functions should be separated from one another. I think an unnecessary burden is being placed on the magistrates in so far as this is concerned.

I have also visited the towns of Balfour and Greylingstad in my constituency during the past week, places which were quoted by the hon member for Bryanston last Friday in connection with the squatting conditions which are supposedly prevailing there, and the CP town council which ostensibly would not provide these people with water.

I want to tell hon members that the statement that water is not being provided to these people is absolutely devoid of all truth. The town council of Balfour is doing everything in its power to provide these people with water. It is a fact, however, that between 48 000 and 50 000 people congregate there over the weekends, and that water will naturally not be available under those circumstances.

I should also just like to refer to the squatters in Greylingstad who are squatting on private property in the town. This matter has been referred to the Attorney-General. Complaints have been lodged by the Dutch Reformed Church, the Reformed Church and certain private owners, among others. The squatters are simply persisting in squatting on this private property. Now a letter has been received from the Attorney-General to the effect that he refuses to prosecute these people.

Surely when people are squatting on private property they must be removed in some way or other. I realise there are problems. I by no means wish to attack the Attorney-General as far as this is concerned. I myself was a member of his staff. I know that his decisions are well-considered. However, it is true that these people are, in fact, on the erven, and if the present legislation is not adequate to remove these people, we must obtain legislation which will result in these people being removed from there and in this problem being solved.

The present state of affairs is resulting in and contributing to the commission of crimes. The people are living right next to the town. Just last week there was a report in one of the newspapers which read as follows:

That is the result of the problems that are being created by the squatting.

I discovered the interesting case of people living close to this squatter township who had written a letter to the hon the State President. They said that the corrugated iron sheets were being stolen from the roofs of their houses—everything was being stolen. The hon the State President subsequently provided these people with two guards, one guard for the day, and one for the night.

However, this is not the solution to the problem. It would be frightfully expensive if everyone who complained that his house had been broken into and that his property had been removed owing to the squatters, were to be given guards. There simply would not be enough money available. I want to ask that we devote a great deal of attention specifically to this matter.

We have also read and heard a great deal recently in connection with the indecent assault of children—child molestation. Hon members have seen the reports of “Guilty after indecent assault in cells”; “Young boys deliberately seduced”; “Young ones testify in case against X”, and so on. Of course, I realise that this is a matter which is receiving the attention of the police. Special units have been formed. We want to express our sincere gratitude for that, but I also want to request that we take another serious look at this problem so that we may excise this cancer from our society.

Mr Chairman, the hon member for Standerton reminds me of a cheer-leader just before an intervarsity. If his team is not going to give a very good performance, he says: “Chaps, we are going to lose the match, but let us beat them on the stands.” This is a typical big mouth in student terms; I do not mean to be nasty to the hon member. [Interjections.] He would seem to be the exception in that party too. Other hon members of that party are quaking about this election. They are not at all prepared for this election, but there must be one person who takes the lead. We shall see each other on the field and then we will see what happen.

Yesterday I was unfortunately not present during the debate of the Vote of the hon the Minister of Justice and I am therefore not quite sure whether the working document of the SA Law Commission was discussed. I assume it was discussed, and I should therefore like to link up my argument with that of other hon members who debated this specific document.

How can you do that if you were not here? [Interjections.]

For the information of the hon member for Losberg, who always makes much ado about nothing, I was participating in the debate on manpower.

Little wool.

No, a lot of wool.

The fact that there has not thus far been such a bill of rights in South Africa, does not mean that the fundamental rights or human rights never applied here. According to our Roman-Dutch Law, our common law concentrated on the protection of human rights and the rights of life, limb, freedom, honour and a good name were subjective rights of every person in terms of Roman-Dutch Law. This point of departure still exists. A few examples will suffice. In the first place, as long ago as 1789 there were clear signs of the concept of human rights in the civil rights petition of the Cape patriots. These were the real patriots; not the patriots about whom we read nowadays in the CP’s gossip-mongering pamphlet. If we go a little further to the good old Free State, where the CP will not achieve anything, we will see that guarantees were already embodied in the 1854 constitution of the Free State for the protection of fundamental human rights.

Nearer to our own time, the preamble to our own Constitution also provides that the Government commits itself to the protection and the respect of the dignity, life, freedom and property of all people. Human rights are universal and the fact that thus far South Africa has not had such a bill of rights is proof of the effectiveness of the South African law, namely to protect the personality rights of people. Yet the Government instructed the Law Commission to prepare a report on individual and group rights.

The Government has committed itself to reform, reform in all spheres of life, and this includes the entire spectrum of human activity. It goes without saying that reform in one sphere of life will of necessity have to lead to reform in other spheres of life. Without arguing the merits of this report, the mere instruction of the Government to the Law Commission attests to another big step in the direction of reform.

Reform is frequently seen by people, particularly by members of the DP, as the scrapping or amending of specific measures. On the other hand this instruction is a positive act by the Government. The mere instruction to the Law Commission is a positive step, namely the establishment of a working document which has made far-reaching recommendations.

In the new South Africa we are all—at least all reasonable people—striving for, the concepts of individual rights and group rights in a bill of rights like this will play a very important role. The working document is the result of thorough research and is based on the principles and practical experience of comparable conditions elsewhere in the world. The document also requests organisations to comment on this specific document.

Mr Chairman, may I ask the hon member a question?

Unfortunately I do not have time for questions.

However, political parties must refrain from misusing the document for party-political purposes. Political parties must orientate themselves with regard to this document, without misusing the report, which is scientifically constituted, for party-political purposes.

This report was generally welcomed abroad as well as in South Africa. I have a collection of newspaper cuttings here in which the report is generally welcomed both overseas and here. This is a non-political document based on scientific, clinical research. It was very well compiled and enthusiastically received. Along with many others I want to express the hope that the final report will be completed as soon as possible after 31 August.

Secondly, I briefly want to give attention to the staff of the Department of Justice. It is well-known that a staff standstill was announced by the Commission for Administration a while ago. Thanks to the intercession of the Directorate of Justice, those posts connected with the implementation of the law have been excluded from staff standstill measures. The willingness of the staff of the Department of Justice to do duty at places other than their stations prevented the court rolls from becoming unmanageable. In this way assistance was given to the TBVC and self-governing states as well as to Swaziland.

The Attorneys-General Branch experienced a big increase in work. In spite of resignations and a low level of experience the staff nevertheless handled the work. The department effectively overcame this deficiency in manpower and experience by means of the following steps. In the first place it is thanks to the loyalty of the staff. These people climbed in, worked overtime and consequently did well.

However, loyalty as such means very little unless there is also effective management. By means of effective management by the department the obstacles in connection with the staff were successfully overcome. Apart from the loyalty and effective management there was also training in order to overcome the low level of experience. During the year under review, a total of 1 654 officials were trained in 48 courses. There were courses for prosecutors, magistrates, regional magistrates, state attorneys, clerks of the court and officials in the Masters’ Branch.

In addition courses were presented for officials of other State departments, for example the Department of Agricultural Economics and Marketing and the Department of Works and Land Affairs, more specifically in respect of the law of contract. Courses in general legal aspects were presented for police officers of the commercial branch and officials of the Department of Manpower, and there were also courses for chiefs and headmen with chief’s courts’ jurisdiction.

This loyal staff is rendering services under working conditions which are sometimes less than pleasant. There is one example I should like to bring to the attention of the hon the Minister, namely the senior public prosecutor’s office in Bloemfontein. In summer Bloemfontein is extremely and sometimes unbearably hot. I have been in the office of the public prosecutor on several occasions during which the poor man sat there while I, as a member of the public, complained to him—he did not complain to me—about the unbearable heat. There were a few fans blowing paper about. I know this matter is not really the responsibility of the department as such, but I should like to ask whether attention cannot be given to installing air-conditioning in these offices, which are frequently not effective.

In conclusion I want to tell the hon the Minister that he has particularly loyal staff to whom the luxury of air-conditioning would not seem to be a decisive factor. We took grateful cognisance of the exceptional loyalty and competence of the staff of the Department of Justice, also in the other joint committees we are involved in.

Mr Chairman, I regard it as a privilege to be able to tackle the hon the Minister again this morning after a long time.

I want to thank him for the other evening’s trip. It is a pity that it did not take place during the day, so that we could see what was going on.

During the five years we have been here, I have listened carefully to the debates, and I wondered what the fighting between the CP and the NP was all about. I tried to find out what it was all about. Then I found that the whole dispute concerned our Blacks and our Coloureds. Last night I lay thinking about why they fight about us to that extent, and I realised that we are important people. [Interjections.] We are terribly important people. I want to tell the hon members why we are so important. I went and opened my Bible, and found the following in Romans 8:16 and 17:

I went a little further and read in Romans 8:31 … [Interjections.] Please, people, just give me a chance. It reads:

Further on, in verse 35, we read:

No—

No, for the Coloureds—

No, for the Coloureds—

No, for the Coloureds—

No, for the Coloureds—

Nothing!—

No!

I then went a little further, and now I want to give this message to the CP and the NP. Before I do so, however, I want to tell the NP that they know they have sinned, and they have confessed, and now they are coming back. The apostle Paul said we should die every day. We must die every day. They are on the right path, therefore. They die every day, until we reach a final destination. [Interjections.] But these people are back on the wrong road, because just listen to what is said in Ephesians 4:31 and 32:

Let us put it away from us this morning. [Interjections.]

Please!—

… as God forgives us. [Interjections.]

I know that when I came here for the first time years ago I cried bitterly. I was very concerned about people who were in prison. Those people had lived with us, and they had picked up some or other problem and ended up in prison. The hon the Minister will remember that I asked what we were doing about these people. Are there sports facilities and so on?

I thank the hon the Minister for listening. May the road ahead for the hon the Minister be a prosperous one. I believe he will return and that the CP will not lift him from his seat. [Interjections.]

When I got to Leeuwkop, I discovered a wonderful thing there, namely my desire that those people who ended up there as a result of problems should be brought back to the community, because that is what God wants of us. That is why he says we must take pity on our fellow human beings.

I saw there what kind of things happen. I merely want to say this for the sake of the people who have not been there yet. Bricklayers are trained there, as well as plasterers, fitters and turners, sheet-metal workers, spraypainters, upholsterers, electricians, welders, joiners and motor mechanics. I cannot say the Afrikaans words all that well, but I shall carry on. [Interjections.] There is also training as tool-makers, blacksmiths, carpenters, cabinet-makers, signwriters, moulders, boiler-makers and machine operators. [Interjections.] I find that gratifying, because I saw that Black people are trained there. I want to wish those who are responsible for this training every success on the road ahead.

It is a good thing for these people to be trained, because when they return to society, they have to be able to live with us again. I want to thank the hon the Minister, because I see in the report that he is involved in this in Pollsmoor too. I want to request that the hon the Minister carry on with that work irrespective of what other people may say. He must continue to serve his fellow human beings, then there will be a place for him in heaven one day. He can be sure of that. He will have the best place. His crown will be studded with diamonds.

I asked the hon the Minister for shelters at Pollsmoor. Our people come and fetch their people there and then have to sit outside in the hot sun or in the rain. I have had to sit there myself in the past. This is a serious request. It will not be all that expensive to erect a shelter there.

I am not the only one who is complaining; the public at large complain too, because there are so many court cases that are not settled. There are people who commit terrible crimes. I know of a person in Ravensmead—the town council complains about this too—who has a long list of criminal charges against him, and not one of these is disposed of, and he continues to get into more and more trouble. I request the hon the Minister to consider these things, so that the cases can be finalised. I know the courts have far too much work, but—I hope the hon the Minister is not an advocate or a lawyer, otherwise I shall be insulting him—lawyers so easily postpone a case. Then there is an additional delay, because all they want is to make money out of their clients. I request that the hon the Minister pay attention to this too.

I am pleased to see that there are also Coloured prosecutors in the courts now. A few women have asked me whether they cannot also study in that direction. I ask the hon the Minister to give me an answer to that today, because I must know by tomorrow. The woman concerned works in a hospital, and she no longer wants to work there.

She could have begun yesterday.

Could she have begun as early as yesterday? Is there room?

Yes.

Very well, thank you.

I read in the report about the chaplains who train the prisoners. I find it very encouraging to see the good work that is done there and the religious spirit in which it is done. Has the hon the Minister told the chaplains, however, to give the people a chance to preach to their fellow prisoners? The hon the Minister has not thought of that yet. Surely it would be good training for those people if they were taught to preach to their people in prison themselves. Once they are released, they will feel that they are also preachers.

I know what I am talking about. I am a believer. I belong to the Pentecostal Church. That is why I speak in this way. I belong to the Pentecostal Church, and I see no mention in this report of chaplains from even one Pentecostal Church. Not one—only those from the Protestant churches. I had a good look. I hope some of the Pentecostal ministers will also be given a chance, because then they will train those prisoners to preach to their fellow prisoners and to bear witness. That would help the prisoners. They must be given an opportunity to say what the Lord has done for them in prison. Then the others, who are still hard, will come round too. Give the people an opportunity to live for God there, so that when they are released, they will be religious people. Do not make them even harder than they were when they entered prison. We must not do that. That is why I thank the hon the Minister for what he has done.

Although my time is limited, there is something that I really want to say. I have become very fond of the CP. [Interjections.] Yes, I am very honest in saying that to them. I have become very fond of them, because I want to move them to become Christians. They attack the NP every day and when our hon members on the opposite side talk about our people who have been neglected over the years—I heard about human rights here too—and when I go back to the Bible … [Time expired.]

Mr Chairman, I must tell the hon member for Ravensmead that I enjoyed his sermon very much. [Interjections.] I agree that the Prisons Service has done a very good job and I believe that the hon the Minister will reply to the hon member’s other remarks.

†This morning I would like to address the vexed question of child abuse. It has been dealt with in a number of Ministers’ Votes, but I would like to look at it from the judicial point of view, and more particularly as regards the issue of the sentencing and the treatment of perpetrators of these appalling offences. In the light of yesterday’s discussion I am, however, not recommending the death sentence.

Like most mothers in this country I have been horrified by the parade of high-profile paedophiles through our courts during the past few months. In common with many other women, I am sure, I have been outraged by the sentences that these child abusers have been receiving. As a mother it seems extraordinary to me that adults who have ruined many children’s lives and who have so publicly contributed to the moral degradation of our society, should pay for these heinous offences with a mere fine of a few thousand rand and a rather vague undertaking to reform. After all, one does not get fined if one is convicted of rape and surely, the misleading and sexual abuse of often very young children is not so far removed from that. So many of the child victims are psychologically scarred for life and I believe—according to what the experts have told me—in the majority of cases the abused often becomes the abuser. There was a particularly horrifying case where Glynn Day—a recently convicted paedophile—abused a 12-year-old boy, who then began to abuse his nine-year-old sister.

I admit that I react emotionally to this, and as a lawyer, I am prepared to concede that the buck has to stop with the courts. The courts have to weigh the evidence and sentence the offenders in terms of the law as it stands. Nevertheless, at the same time I think it must be admitted that those who have succeeded in bringing these offenders to justice, namely the dedicated policemen like ex-WO Grant Robertson and Col Serfontein who pioneered the Child Protection Unit, the overloaded social workers who try to restore the victims to normal life in society and who have the job of trying to piece together the shattered lives of these child victims—all these experts despair over the sentences that the child abusers and molesters are being given.

Now, the Sexual Offences Act—the Immorality Act, No 23 of 1957—provides that the penalty for committing an immoral and indecent act with a boy under the age of 19 or a girl under the age of 16, or having unlawful carnal intercourse with such girl, shall be a period of imprisonment not exceeding six years with or without a fine not exceeding R12 000 in addition to the imprisonment. The Act is silent about any possible therapy.

If we examine one or two of the recent cases to see what actually happens in practice we get very varying results. The actor Don Lamprecht, who the court found had made the very first known local child porn video with a boy who was 12 at the time and who admitted to having been a child abuser over a period of many years, was fined a total of R10 000 on the sodomy and possession of pornography charges and was given a three-year suspended sentence for the indecent acts committed, but on condition he receive treatment for a rather short period of 18 months. Then again we can take the Cape Town case of John Logan who had a long career similar to that of Lamprecht and who was fined R13 000 and had a six-year prison sentence suspended, again on condition—his condition being that he be treated by a clinical psychologist for five years and receive a course of injections.

Apparently these female hormone injections are meant to inhibit the sex drive, but I gather from the experts that there is no conclusive evidence that this is successful. In one of the first highly publicised cases the accused, Glynn Day, received four and a half years’ imprisonment without the option of a fine for his paedophiliac activities which were similar to Logan’s and Lamprecht’s, though I gather he is now appealing against this sentence.

I believe the National Council for Child and Family Welfare has complained to the hon the Minister that there appears to be no consistency in the courts’ approach. Widely divergent sentences are being imposed. While in many recently highly publicised cases a suspended sentence has been imposed, in many other cases prison sentences of up to sixteen years have been imposed. Fines vary between R250 and R13 000, while only in a very few recent cases have sentences been suspended on condition that the accused receives psychiatric counselling and other medical treatment. In other words, only very few offenders are compelled by the courts to receive treatment although all research and learning on the subject indicates that this is essential if the child abuser is to have even a hope of rehabilitation. The point has been made by ex-warrant officer Grant Robertson that in the case of the paedophile one is reforming a lifestyle and not just a pattern of recent behaviour.

During the past few weeks I have spoken to a number of child psychiatrists, social workers and policemen—all specialists in their field—and members of the Prisons Service who deal with psychological services. There seems to be total agreement on a number of points.

Firstly, the problem will not go away. In fact, statistics show that it is on the increase worldwide and certainly in South Africa. According to statistics kept by the National Child Welfare Society the average monthly case load of sexually abused children in 1986 was 276 cases. By 1987 this monthly average had increased in one year to 405 cases per month. By November 1988 it had risen again to between 470 and 480 cases per month. I submit that these statistics are alarming. With the introduction of Childline, the facilities for reporting cases and the Child Protection Unit of the Police, obviously more and more cases will be coming to court.

The second point of agreement is, as I have indicated, that the injections the convicted paedophiles allege they are receiving are of dubious effect.

Thirdly, according to the statistics which are available chiefly from the United States and the United Kingdom, there is evidence that even after the deterrent of a public trial and a suspended prison sentence, the recidivism rate is still 75%. Therefore we need to look at further innovative techniques, for instance, I gather the Police have started a confidential list of suspected perpetrators.

The fourth point of agreement among all these people is that there will be a relapse unless the perpetrator is removed from society and treated intensively.

I would therefore like to ask the hon the Minister whether there is not room for a wider investigation into the issue of the sentencing and treatment of the perpetrators of child abuse, especially treatment in prison. There has been much talk around these cases that our prisons do not have the facilities to treat these offenders, but I doubt that that is the case.

Previous speakers have referred to the fact that the hon the Minister has already initiated an investigation into this field with his recent instruction to the Law Commission to investigate possible new protective measures in law for the child victim of abuse, but so far concentrating in this case on the child victim as witness. I would like to congratulate the hon the Minister for reopening this investigation. As I understand it, this investigation is aimed at eliminating what child psychiatrists call the second stage of abuse, which the child abuse victim is forced to endure in the course of giving evidence against the offender, often under pitiful circumstances. I agree that the inhuman trauma these children suffer should be alleviated and, even better, eliminated as soon as possible.

A previous speaker referred to the techniques that the hon the Minister mentioned in his instructions to the Law Commission, namely the use of one-way mirror windows for identifying the suspect and at the same time screening the child from the accused while giving evidence, the hearing of evidence in a room other than a court-room, assistance by a clinical psychiatrist and the use of video tapes. What worries me, however, is that when the Law Commission last investigated the possibility of alleviating the trauma of the child witness in 1985, it concluded that reforms would involve too drastic an interference with the existing system. Hopefully we will now find the courage to adapt to changing circumstances. [Time expired.]

Mr Chairman, it is a pleasure to follow the hon member for Rosetten-ville. I must admit that her speeches in this House certainly hold everybody’s attention, and I congratulate her.

At the outset I would like to ask the hon the Minister a question with regard to the appointment of justices of the peace. I would like the hon the Minister to give me a clear indication since regrettably I find that he does not reply to my correspondence. [Interjections.] I may add that this is not a good reflection on anyone’s efficiency. However: May I ask what is the position in regard to the approval by an MP of a constituency relative to the appointment of justices of the peace? Are they given the courtesy of expressing an opinion or is this not relevant? Is the sitting elected MP for a constituency consulted in regard to the appointment of justices of the peace?

I wish to raise a matter which is in the first instance of little significance to the public living in urban areas. I want to draw the hon the Minister’s attention to the escalation and the incidence of stock and crop thefts that are at present taking place in many rural areas. I want to make an appeal to the hon the Minister to ensure that positive steps are taken to increase penalties and sentences applicable to those convicted of these crimes, bearing in mind that in this respect the adage of punishment befitting the crime is no longer relevant. I want to point out that crop and livestock farmers in many areas are increasingly becoming the victims of carefully orchestrated theft campaigns which can be seen as a blatant disregard of the law as it is at present, clearly indicating that the existing level of penalties is no longer regarded as an adequate deterrent.

The time has come for the hon the Minister to give more serious attention to this matter. He must also not lose sight of the fact that the scale of farm theft can no longer be regarded as petty. In some cases it is becoming intolerable. It is also gradually developing into a highly sophisticated operation and it is costing the farmer millions of rands a year. Let me also warn that the incidence of theft at its present level, if allowed to continue, will inevitably have a destabilising effect on the farming community in many rural areas. For this reason alone a more realistic approach to this problem is required.

I wish to raise another matter with the hon the Minister which is causing concern at certain rural courts, namely the standard of prosecution in some of the rural areas and the inadequate preparation of charge sheets. I have received reports which indicate that cases have come before the courts and have been rejected by the judicial officer on the grounds of the inadequate manner in which evidence has been presented to the court, and not necessarily on account of the innocence of the accused.

It has also been reported to me that in certain cases charge-sheets have been draw up by junior constables who have little experience in collating evidence as required by the courts. There are also instances where these juniors have been required to act as prosecutors. I would therefore appeal to the hon the Minister to give this matter his attention as it would appear that there are not sufficient public prosecutors available to serve the many rural courts. May I suggest that consideration be given to the deployment of students, who, in the throes of their training to become magistrates or prosecutors, and as part of their practical training, could be used to prosecute in rural courts? This, as I see it, is a means not only of broadening the base of in-service training, but at the same time meeting a very important requirement. [Time expired.]

Mr Chairman, at the outset I must confess that I have great respect for the South African Department of Justice. Despite minor discrepancies, the independence and impartiality of our justice system is known throughout the world. Perhaps the rest of Africa and many countries in the world could emulate justice as practised in this country. We have men of honour and integrity serving as judges who are well-known for their condemnation of any irregularity even when the Government itself is on the receiving end.

However, the judges and courts are placed in embarrassing situations when they have to pass judgements on laws based on discrimination and on the race and colour of a person. What does one do when two passages lead to the same post office? How can one of the passages be right and the other wrong? The exclusive use of public facilities reserved for one section of the community is ridiculous.

When colour and race are the basis of determination, how can justice be done? How can justice be met in the eyes of God and man when all sorts of action are taken against people who protest against such discrimination? Surely this will lead to polarisation of people against the authorities and the White people in general.

The courts can only administer justice in terms of the law. In South Africa the White governments have spent the better part of their rule in propagating laws and statutes to promote the sectional interest of the White community. This was done irrespective of what nationality they were, as long as they were White. A White Greek foreigner has more rights and privileges than a fourth-generation South African of Indian origin.

Since the NP came into power, it has spent over forty years concentrating on discriminatory laws which were statuted. All efforts and representations to reason with the Government were fruitless. Instead of getting people together, the Government chased them away. What the Whites failed to realise was that it was far better to debate the issues rather than ignore them. The Government also failed to realise that the discrimination against masses could muster support not only among the indigenous people of this country, but also people from all over the world. Despite the efforts by extra-parliamentary forces to negotiate and reason, the Government was rigid and arrogant.

Therefore, the ANC, having been banned, went underground and established a base outside South Africa. Violent confrontation in the form of terrorism was the result. I want to make it very clear that I do not condone and support violence or any form of terrorism. However, terrorism is a result of bannings. Much damage has been sustained. Many lives have been lost and much hardship experienced. It is a costly affair to safeguard ourselves against terrorism—the price we pay for apartheid in this country.

On the brighter side, the Government today is looking at the options. At this time a lot of people are talking about a new South Africa. The NP for the past four years has been making efforts to improve the situation in this country. There is hope. This is a good sign. It is seeking non-White opinion to a negotiated settlement which—I hope—will lead to eradicating all the discriminatory legislation on our Statute Book.

To alleviate the burden on the South African courts and particularly to appease the consciences of judges, these discriminatory statutes must be wiped off the Statute Book in this country.

No doubt the hon the Minister is a respectable man. His leadership in his department is noteworthy. He reminds me of Blake’s The Tyger. The tiger is beautiful and magnificent and at the same time powerful and dangerous. However, I see more lamb in the hon the Minister than tiger. I wish the tiger would come out in the hon the Minister and convince his colleagues to unban all banned organisations, stop detention without trial, revoke the emergency legislation and release all political prisoners, especially Nelson Mandela. We can then look forward to a new South Africa where justice is credible and which we can be proud of in this country.

Mr Chairman, the hon member for Merebank will excuse me if I do not follow on his speech. However, I want to address the subject of stock theft which I am sure he does not have any knowledge of.

*The Stock Theft Act was proclaimed before there was large scale game farming. Consequently no provisions in the Stock Theft Act apply to game. Nowadays game is being farmed with like livestock, and for that reason it is important to hear what the hon the Minister envisages in this specific case.

The degree of stock theft in our country is really a barometer, firstly, of the economic activities of the country, because in those cases where the economic activity is high, one finds that meat prices become relatively higher than other prices and the incentives to steal stock are far greater. Secondly, stock theft is also a barometer of the standard of living of the people in the rural areas and squatter areas. The lower those standards are, the greater the incentive is to steal livestock.

The concurrence of these two situations during the past year has resulted in the stock theft position in South Africa deteriorating so much that farmers, as the hon member for Bethal also demonstrated here yesterday, are constantly requesting more severe penalties, so much so that they are irreconcilable with the legislation in a country like ours or with perfectly normal human existence. Under these circumstances I am very grateful that the hon the Minister has taken the initiative, as he has in many other spheres, to try to find a meaningful solution.

On his initiative a work committee has been formed by the Ministries of Justice and Law and Order and the South African Agricultural Union. This working group structured its investigation as follows. They investigated what problems were being experienced in police actions, what problems were being experienced in the court procedures and what contribution the farmer himself was making in respect of stock theft. It was found, firstly that there was a shortage of policemen to combat stock theft properly, and it was decided that there had to be better co-operation between the police and the farmers. A request was also made for the police units made available as stock theft units to be enlarged.

As regards court procedures there were suggestions that prosecutors did not always have the necessary knowledge. The Attorney-General, on the instructions of the hon the Minister, sent out circulars that expert prosecutors had to be appointed to litigate these cases. In the same way, after the problems in connection with the parole of stock thieves had been pointed out to the hon the Minister, it was decided on his insistence that when parole was considered the aggravating circumstances in connection with the stock theft had to be taken very seriously into consideration.

The most important aspect of this joint working committee is that these three groups—the farmers, the police and the Department of Justice—have gained a better understanding of each others’ problems. One of the most important consequences of this is that there is now better co-operation and that the farming community, namely the SA Agricultural Union—the hon member for Bethal must listen—has decided not to go ahead with demands for more severe penalties.

What is so tragic about this entire document, however, is the following. I made enquiries, but in my entire constituency there is no one—no district farmers’ union or association—that knows about this working group or about this document. Nor do they know about the results of this. As far as the lowest level is concerned the SA Agricultural Union therefore neglected to communicate the findings. It is therefore absolutely essential that we convey this knowledge of the co-operation between the SA Agricultural Union, the Police and the Department of Justice to the lowest level so that the great ill-feeling can be eliminated.

Unfortunately the working group did not also concentrate on the Stock Theft Act, to see what problems were being experienced in this connection. I want to ask the hon the Minister to effect certain amendments to this Act. According to section 3, in all cases, except at a public sale, the person who receives livestock into his possession must ascertain on reasonable grounds that the stock really is the property of the person who says he is the owner.

This means that when livestock is sold at a public sale, no one is compelled on reasonable grounds to ascertain for themselves who the lawful owner of the stock is because the agent, as the person who receives the stock into his possession, according to general mercantile law, is not responsible for the stock. The agent is therefore never asked to ascertain that the stock he is offering for sale is really the property of the person who is offering the stock for sale. As a result the agent can never be reprimanded when he offers stolen stock at a public sale.

If we want to effect the change we need only extend section 6(6) so that as regards section 3, the agent will be considered to be a person who has received the stock into his possession. If we do that, we will have gone a long way towards solving this problem, namely agents who receive stolen stock into their possession.

[Inaudible.]

It is specifically for the auctioneers.

[Inaudible.]

For him too—for all agents. If we therefore say that the same kind of provision which we have in section 6(5)(c) will apply as regards section 3, namely that a person who does not ascertain this is guilty of an offence, I want to tell hon members that we will have broken three quarters of the chain in connection with the theft of stock and its sale at a profit.

I am asking the hon the Minister to give very serious attention to this specific statutory amendment. It is my personal experience that the thief usually does not have the financial means to compensate one for what has been stolen and sold. The man who does have the funds, who has the financial means to compensate and who is making a profit from the sales, is getting off scot-free. He is only getting off scot-free because of the provisions of section 3. I am speaking under correction when I ask that we amend section 6.

Mr Chairman, today I want to address the hon the Minister on a matter which has become a very sore point for us, particularly in the Black and Coloured communities, during the past few years. This is a matter which we have touched on here in the past, and I want to ask the hon the Minister, when I have finished speaking here, to rectify this matter for us.

I am talking about the behaviour of messengers of the courts and the way in which they set about doing things. Every week I have the unpleasant experience that my night’s rest is disturbed on Thursday mornings from 3 am onwards. This happens again on Saturday mornings when the messengers of the court sneak around like thieves in the night, drag people out of their beds and herd them all to the police station, from where they are loaded up and taken to Pollsmoor at sunrise.

It is necessary for us to consider what offences we are dealing with here. I want to give hon members a specific example. A woman had an account at a shoe shop. The initial purchase price was R60. She had to pay off R10 per week, and as things go in these economic conditions, she did not pay a couple of times. What happened was that by the time she could pay, the attorney had already put up his legal costs, and eventually the messenger of the court came along, loaded her up and took her to a police station at 3 am where she had to wait until he had finished his rounds.

Then I was called in, I who have never practised a legal profession and have never been a policeman either. I had to go and settle the matter. When one looks at the people’s receipts, one is heartbroken to see that the original debt was R60 and that the woman has already paid R275 and is now going to be locked up for R300. I call that daylight robbery.

By February of this year—this is a reflection of the economic conditions— the number of summonses for debt in the Cape Town magistrate’s court was already in excess of 4 000. At almost R100 per summons these messengers of the court are becoming quick-millionaires.

We cannot allow this kind of thing. I object to people who have jobs, being taken off to Pollsmoor—particularly over weekends. If the man is arrested on Saturday morning, even if he could borrow the money from someone, there is no way in which the attorney’s office will be open to receive that money. I know hon members will say that the messenger of the court is also authorised to take the money, but arrangements could at least have been made.

I want to give hon members another example. A woman came to me and said that the messenger of the court was going to come and fetch her. She is a widow and has four children. I told her that she should keep her two-year old baby with her and see that all her children went along with her. The woman was taken to Pollsmoor. Fortunately the officials at Pollsmoor realised they could not lock up a woman with small children.

This kind of thing is causing friction in our community. We do not want this kind of thing. If people do not want to pay their debts and nothing helps, they must at least come into consideration for community service. However, the person must not be removed from his neighbourhood and locked up. After he has been in prison for a month he will have lost his job in any case and then he must still pay the debt.

I appreciate that the courts have too much work, but another noticeable problem is the following: If one goes to any court in our neighbourhood on a Monday morning one sees that a number of drunkards have been arrested over the weekend and then they all have to appear before the magistrate, like a herd of sheep being led to the slaughter. They are all found guilty and fined R30 or 30 days. We cannot allow our people to be treated like animals. I believe the courts are wasting too much time on these minor community offences. We can get an ordinary commissioner to handle those people’s cases; that is not the job of a magistrate. We simply cannot carry on like that.

What about a justice of the peace?

An ordinary justice of the peace may be able to deal with this, but then we must appoint them. We can try that load of people from Macassar on the spot. How much time and money is not involved in this?

Another question I want to put to the hon the Minister concerns the fact that we find that an increasing number of computer offences are being committed in our country. Are our prosecutors trained to deal with this kind of case in court? This is a new thing. The computer only started coming into its own recently. Hon members will notice that these offences are starting to assume serious proportions. Nowadays it is so easy that a person can use his own computer to interfere with another person’s banking account. Does the hon the Minister have the trained staff for this?

Is what you have just said true?

It can happen.

Elaborate on that, because it is a very serious matter.

It can happen. I will not elaborate on it, because I do not have the proof with me now. However, I shall discuss this with the hon the Minister later.

That is a leading article in the newspaper; the hon member must elaborate on it, because it is a very serious matter. Otherwise he must withdraw it.

I shall withdraw it for the moment, until the hon the Minister and I have cleared up the matter. However, the question which the hon the Minister must reply to is whether his public prosecutors are trained to deal with this kind of offence in court.

The trial of minors remains a serious issue. The trial of minors has always been a dangerous situation for us. A child who commits a serious offence must obviously be placed in the care of his parents, as has been done over the years. There is a difference as regards the kind of offence which that child commits. I should like to request that, before he is arrested, we should consider what the chances are that he will repeat that offence after he is released.

Mr Chairman, I would like to state right away that I found some aspects of the hon the Minister’s reply yesterday rather puzzling. Firstly, for the hon the Minister to use the case of the screwdriver murderer, Van der Merwe, as a justification for the retention of the death penalty seems to me very surprising. Van der Merwe was a known psychopath. The point is that he should never have been released from prison. We would not have hanged him anyway; it is not the custom in this country to hang people who are psychopathic or insane. One easy way, I would say, of avoiding the death penalty is to be declared a psychopath. However, he obviously should not have been released from prison. His case was totally irrelevant in the arguments for or against the retention of the death penalty.

For the rest, I may say, all the information that the hon the Minister gave us about the wide differences of opinion that exist on the question of the retention, or otherwise, of the death penalty, simply point out the very real need for a proper in-depth judicial inquiry into the death sentence as a deterrent and what has happened in countries where the death sentence has in fact been abolished. I can see no reason why the hon the Minister will not do this. This country has never had a proper inquiry into the death penalty. We are now hanging an inordinate number of people. This year, fortunately, the number of executions has gone down and last year it was less than the year before. However, the year before that reached an all-time high of 164 people being executed in this country.

Therefore it is particularly in times of unrest when we have sentences practically every month, where the death penalty appears to be under consideration, I think that it is very necessary to have this proper in-depth inquiry.

The hon the Minister raised a red herring in his reply to me when I discussed with him and the House the very lenient sentence which had been passed by Magistrate Venter in the case of Fouche and Venter in the circuit court at Klerks-dorp. The hon the Minister wanted to know whether I was asking for the Attorneys-General to be allowed to appeal.

Support me.

No, I am not going to support the hon the Minister and this is precisely why I am bringing the matter up. It is a red herring and the object of the exercise is not to extend to AGs the power of appeal against lenient sentences. That is certainly not the case!

What I am asking is for the hon the Minister to make absolutely sure of the suitability of persons who are appointed to the Bench. That is the important matter. We must make sure that they do not have racial attitudes which are going to harm the relationships in this country and that they do not consider the life of a Black man of no importance. Those are the things which he must understand. If this is the sort of thing which happens over and over again in certain cases, then he must remove those people from office, particularly in the case of magistrates, where the hon the Minister has no procedural difficulty in removing them.

The hon the Minister must also see that prosecutors do not go in for plea-bargaining, because this seems to be one of the reasons why we have these lenient sentences. Plea-bargaining takes place between the prosecutors and the attorneys defending the accused, resulting in a less severe charge being accepted on a guilty plea. That of course results in a more lenient sentence. Those are the points which I was trying to emphasise. I was certainly not trying to change the system of law so that the AGs can appeal again lenient sentences. I just wanted to make that matter quite clear.

I would like to use this opportunity to ask the hon the Minister to extend the scope of the investigations done by the Law Commission. The annual report mentions a number of very important projects which have been undertaken by the Law Commission, and I have indeed been fortunate enough to have been involved with the consequences of some of those investigations, particularly those concerning the Matrimonial Property Law Amendment Act. I might add that we did not get everything which the Law Commission recommended, as the hon the Minister will remember.

The report mentions that the marital power has been abolished, thereby giving women equal contractual status. We in fact wanted total abolition of the marital power. The Law Commission and joint committee recommended this, as the hon member for Pietermaritzburg North, a member of the commission which was chaired by the hon member for Mossel Bay, will remember. We did not want the abolition to be retrospective so as to undo contracts which had already been entered into, but rather to make sure that women married in community of property before 1984 could at least manage their affairs without having to get the consent of their husbands over every single contractual situation. That was of course rejected by the hon the Minister, despite the recommendations of the Law Commission and joint committee.

Would the hon the Minister, however, now consider getting the Law Commission to investigate the whole question of the abortion laws in South Africa? The hon the Minister must not pull a face like that, because I want an investigation. I am not asking for abortion on demand, as this will always send shivers down the backs of most men, although I can assure the hon the Minister that it will not send shivers down the backs of every woman.

In order to back my plea I would like to quote a few figures. First of all, as the hon the Minister knows, we have an alarming population explosion in this country.

Is this really valid?

Yes, I think it is, because I want the Law Commission to investigate it. I am not asking for a judicial commission to investigate it as I have already failed to get that from the hon the Minister of National Health and Population Development, who has a particularly chauvinistic attitude on this specific question.

I know that this hon Minister is favourably inclined towards the liberalisation of situations where women are concerned. For that reason I want to give him these figures.

We are in the midst of an alarming population explosion, and although I am not recommending abortion as the cure for the population explosion, since all of us know that raising the standard of living is obviously the very first remedy. One always finds that the birth rate is lower when there is a higher standard of living among the population. The second remedy is, of course, family planning. It has not been found in any country in the world, however, that there has been a successful family planning programme without the back-up of liberalised abortion laws. That is just a fact, and the hon the Minister can check it. In Taiwan, China and any other country he cares to mention, that has been the case.

I wish to emphasise again that this is my own opinion and not the policy of the DP, although they would never be against an investigation. I happen to be in favour of liberalising the laws, but that is not DP policy.

May I just give the hon the Minister a few figures. The annual health report tells us that between September 1987 and August 1988, 31 739 operations for incomplete miscarriages were performed, and 1 398 for septic miscarriages. Of the 31 739 operations for incomplete miscarriages, 16 800 were on single women, 420 on divorced women, and 151 on widowed women. That makes 17 372 in toto, and how lucky they would be if those were normal miscarriages! Among single, divorced and widowed women one can almost inevitably claim that those are self-induced miscarriages, and this certainly applies in the case of the septic miscarriages as well. Of those, 981 were on single women, 30 on divorced women, and 19 on widowed women, and that makes over 1 000 in toto. There were 117 such operations done on girls under the age of 15.

The least thing this commission could enquire into is, I would say, the alteration of the laws regarding pregnant girls under the age of 16, older pregnant women, and women who have large families and do not want any more additions to their families. Otherwise we are simply going to go on having self-induced miscarriages and backstreet abortions, with all the dangers inherent therein, increasing year by year. The health of the women and of the population generally is involved here, and I hope the hon the Minister will consider this matter.

It is not my portfolio.

It is his portfolio. The SA Law Commission falls within the ambit of his portfolio.

[Inaudible.]

No, the hon the Minister asks the Law Commission to investigate all sorts of things. He can investigate this as well. [Interjections.]

Mr Chairman, the hon member for Houghton will forgive me if I do not react directly to her speech. She spoke to the hon the Minister and I am sure that he will reply to her.

I should like to take this opportunity, seeing that it is the first chance I have, to congratulate Mr Noeth sincerely on his appointment. I also want to wish him everything of the best in his very big and important task.

I should also like to thank Adv Rudman, Mr Nel, Mr Allers, Mr Labuschagne, Mr Saayman and all the other officials most sincerely for their helpfulness and the extremely friendly service we always get from them. We sincerely appreciate it.

In any civilised body politic rules of law are created in accordance with the attitude of the community served by them. It therefore follows that legal norms are not stagnant, but that they should change if there is a shift in community attitudes. If legal norms do not keep pace with changing community attitudes the legitimacy of a legal system is at risk.

The South African legal system has developed over the centuries and it goes without saying that in the course of time certain legal principles have lost their relevancy. In this connection the Government, and pre-eminently the hon the Minister of Justice, realised the necessity for reform in our substantive law and took positive steps to bring this about.

The SA Law Commission is doing tremendous work in the field of legal reform. I should like to congratulate them very much on the extremely high quality of their research and reports. When one takes a quick look at the legal reform introduced under the chairmanship of Mr Justice Viljoen, one becomes aware of the great extent of the legal reform. Mr Justice Viljoen was appointed Deputy Chairman of the SA Law Commission in 1977 and Chairman on 30 September 1982. He was therefore a member of the commission for just over 11 years, seven of those years as the chairman.

During his period of office in the commission, and particularly during the seven years of his chairmanship, very important legal reforms were initiated and carried through. This not only contributed towards South Africa being able to keep pace with developments here and abroad, but in certain instances we even took the lead. In this connection we can refer to the Admiralty Jurisdiction Regulation Act, the Computer Evidence Act and the greater admissibility of hearsay evidence in terms of the Law of Evidence Amendment Act.

Interesting developments took place in the field of family law and the law of persons. The previous speaker also referred to this. In particular the position of the woman and the child was improved in several respects. Here we need only—as the previous speaker also indicated— refer to the Matrimonial Property Act, which introduced an entirely new matrimonial property dispensation and restructured the existing dispensation. It was also made flexible and adjustable in that spouses may, during the existence of the marriage, change over to a dispensation which suits their circumstances better.

Particular attention was also given to the family law of Black persons. The commission investigated the legal position of illegitimate children which resulted in the Children’s Status Act. In this way the commission introduced innovations in respect of the disadvantages inherent in illegitimacy. There were investigations into artificial insemination, certain out-of-date presumptions of law and proof of paternity.

The question of bringing the age of majority forward was also contentious for a long time. After the commission had investigated this and had also considered the entreaties of young people, they recommended that the age for attaining majority should remain 21 years. This was also accepted by the Government. Precedent-setting recommendations were also made in connection with sexual offences.

Other matters to which the SA Law Commission gave attention during the chairmanship of Mr Justice Viljoen were the issue of delictual liability in respect of misrepresentation, the bounds of criminal defamation, the law of intestate succession, the law of trusts, preferential charges in respect of insolvency, the lifting of certain restrictions in respect of land, risk as grounds for liability in respect of delicts, the legal consequences of suspensive conditions in respect of deeds of sale, the periods within which lawsuits must be instituted against the State, offences committed under the influence of liquor or drugs, the prize law, pension benefits of a divorced woman, the support of surviving spouses, enduring powers of attorney and the appointment of curators for mentally incapacitated persons.

Investigations which have already started, but have not yet been completed, include insolvency and surrogate motherhood, and everyone knows about the report on individual and group rights which has also been made available.

The above only contains a few examples of the Government’s sustained commitment to legal reform in order to ensure that our substantive law keeps pace with changing needs and circumstances. If the substantive law is defined properly and in accordance with the attitude of the community, this still does not give any guarantee that the legal system will meet the demands and needs of our times. Properly defined laws which cannot readily be enforced by means of a legal process are sterile. It is in this connection that the formal law is of cardinal importance. The way and the process in terms of which substantive laws are enforced in the courts is, after all, arranged by this branch of the law.

It is against this background that the Government, and again I must say pre-eminently the hon the Minister, has recently taken positive steps to increase the relevance of our civil litigation process. As long ago as 1979 the Hoexter Commission was instructed to investigate the structure and functioning of our courts. The commission found inter alia that there was a great need for the simplification of the procedures in our courts in order to make the legal process more accessible to John Citizen.

The Rules Board for Courts of Law was established in 1987. The Rules Board has the power inter alia to adapt the rules and procedures in civil procedure to meet prevailing needs and circumstances. The consideration of the monetary limits of jurisdiction of the lower courts and the restriction of litigation costs are other important functions of this body. There is no doubt that the Rules Board is an important instrument in the endeavour to achieve greater accessibility and will remain so in future. The Rules Board has already been instructed to investigate diffuse rules and procedures of litigation with a view to the abolition of non-essential procedures. In this way a valuable contribution will be made towards saving time and money, because it is after all these two factors which determine the accessibility of our courts, about which we all feel very strongly.

According to the annual report of the Department of Justice the Rules Board has already started making the rules for the Supreme Court and the lower courts uniform and consolidating them. I would appreciate it if the hon the Minister could inform us on this and could tell us what progress has been made in consolidating these rules and making them uniform.

Mr Chairman, for the information of the Extended Committee I want to mention that so far 125 subjects have been raised, which is 11 more than any previous record during the same period of time. I am going to refer very briefly to a few of the hon members who dealt with matters affecting their own constituencies.

†The hon member for Camperdown is concerned about the situation that the small claims court has not been gazetted yet. We have to create the position of a clerk of the court for Chatsworth and we are working with a limited budget. However, at this very moment the Director-General is considering moving some of the funds for other projects to this particular one. This is a case in point to illustrate the fact that, as our funds have permitted, we have gradually been expanding the services of the small claims court. I want to ask the hon member and other members to be patient. We are already serving almost 12 million people and I think we should be satisfied with the progress we have made, but the matter is receiving our attention.

The hon member for Mooi River is obviously one of the hon members or at least, he is one of the members of the farming community who have not taken cognizance of that report. Otherwise the vein of his speech would have been somewhat different. I think the vein of his speech would then perhaps have been one of understanding, also in regard to the fact that we have to rely on constables or policemen to act as prosecutors in some rural areas.

Let me use this opportunity to thank the Police Force for having been prepared to assist us in rural areas throughout the years. It is also well-known that in certain situations they have rendered service as prosecutors. They have done so in a very admirable manner. There is nothing like experience.

When I was in the Eastern Free State and very interested in court work I was under the impression that the policeman is everything—he investigates, he prosecutes and he also says what the sentence should be. It was only much later that I came to realise that the policeman is not all that awesome and powerful, but that does not remove the fact that they have been rendering this kind of service at our request because we have a shortage of manpower.

It cannot always be justified to have a fully qualified prosecutor if he only spends a limited number of hours in court. Then we have to use manpower elsewhere and I think the hon member will understand. However, it is not the proper thing. I agree with him. Prosecution should be handled in a professional manner but there are exceptions. I am just afraid the hon member could have created the perception that the exception is the rule, which is definitely not the case.

As a matter of fact, if he had listened to justice debates more often, he would have realised that over the past five, six or seven years we have restored the position of justice in rural areas. As a matter of fact, I am keeping in touch with the position in regard to the return of magistrates to certain rural areas from which they were originally removed on account of the limited number of court hours. I am a committed “plattelandse seun” and he does not have to fear that I stand aloof with regard to the problems of the farmer and the people of the platteland.

As a matter of fact, if he had listened carefully to the hon member for Heilbron, he would have realised that I actually introduced the principle of the limitation of parole in certain areas. I am not sure but I think his area was one of the first which qualified for no parole. There is an open invitation to all members of Parliament to approach the Department of Justice if they think the incidence of stock theft justifies that parole be limited in a certain area.

Apart from what I have said on this topic, I think the hon member should perhaps first read the report and, if he wants to make any suggestion, as the hon member for Heilbron did, my door is open to him at all times.

*I shall investigate the suggestion of the hon member for Heilbron in connection with a possible amendment to the Livestock Theft Act. It will not be the first time that an engineer tells the legal people in Parliament how an Act should read. Consequently I am quite prepared to listen to this expression of his sound common sense and give attention to his suggestion.

The hon member also gave me an opportunity to think of a different way of presenting the report in connection with livestock theft, which is compiled by three departments. My department is going to ask every magistrate in every district to become conversant with the contents of the report—I assume this is already the case—and then to liaise on his own initiative with the district farmers’ union to make certain that that information is distributed. This report does not merely say that the fault lies with the Department of Justice or with Law and Order, but also says what the farmers ought to do to make certain that actions are litigated more satisfactorily. I do not know where the hon member is at the moment, but what I shall do in this connection will be conveyed to him.

†I want to say to the hon member for Mooi River that justices of the peace may be appointed on application by an individual and also upon the recommendation of an MP. As a rule we consult MPs, but their advice or opinions cannot be conclusive. I have come across situations where I actually differed with an opinion expressed by an MP and acted in accordance with my interpretation of a situation and with what I considered to be advisable and for the best at that time. My administrative secretary informs me that he has consulted with the hon member for Mooi River on a number of occasions and he will continue to do so.

Mr Chairman, may I ask the hon the Minister why it is then that a recent appointment in the Mooi River district was not referred to me in any way at all—not even just for comment?

Mr Chairman, MPs are consulted as a matter of courtesy. For obvious reasons the appointment may possibly not be referred to an MP. The hon member might have turned it down in any event, and this is why I say his advice is not conclusive. I will investigate the matter in any event. However, I cannot bind myself to do so in every case, because we want an objective judgement—and I am not saying the hon member is lacking in objectivity. I do not think the hon member should feel that the wrong appointment has been made. I will go into the matter if he can convince me that the wrong appointment was made.

*The staff situation of the Department of Justice, particularly when seen from the point of view that various population groups are evidently not represented in a balanced way, was raised by the hon members for Sandton and Daljosaphat, and I think it is very important that we discuss this question. I will be the first person to concede, and not only concede but insist, that the Department of Justice should be colour-blind, not only in regard to the implementation of the law, but also in regard to its personnel. Secondly I will be the first one to make the statement that merit and merit alone ought to be the criterion.

I received a note from an hon member in this Committee who is not a member of my party, nor a member of the House of Assembly. In it he said that there had to be a mistake somewhere with the information and/or observations of the hon member for Sandton, because he knew of a Coloured magistrate in a large rural town, and he said he knew that this magistrate was there on merit. He could not understand why the hon member for Daljosaphat in particular had not been informed of this, and why the hon member for Sandton had not been informed either. I want to tell the hon member for Sandton at once that it goes without saying that people are appointed on merit and are promoted after they have done well. So, for example, we recently appointed interpreters as prosecutors, after they had completed prosecutors’ courses. They had to have the experience, personality and other qualities necessary for that post. If one considers the courses that are offered it is very clear that Blacks, Coloureds and Indians are also attending these courses. Last year I attended the year-end ceremony of the legal training unit in Pretoria. There were people from all groupings.

You gave me the information.

Yes, but the hon member has interpreted the information wrongly because according to the information these people do go on courses.

What percentage of Coloureds?

The percentage is not the point. The fact is that the possibility is there and that people are availing themselves of it. The fact is that there is no limit on the percentage and that it is possible to have constant expansion. I have said that there is expansion. We are training interpreters. As an example I am looking here at the administrative clerk position of the Department of Justice. There are 49 Coloured people, 53 Indians and 309 Black people. These numbers can continue to grow in the department. Furthermore, the situation in respect of State prosecutors is as follows: 55 Coloureds, 30 Indians, 28 Blacks, and so on. What was the situation a few years ago?

I have just pointed out to hon members that even court interpreters can progress to the rank of prosecutor. We have no fewer than 698 interpreters. This is therefore a very rich source from which people can be drawn.

Of course our establishment is not satisfactorily filled, but I want to ask hon members whether we can expect people to flock to the Department of Justice while we continue to say here that there is a legitimacy crisis? What kind of help am I getting from hon members? What kind of help am I getting from the opposition when they say that more people of colour should become involved, yet they also say that there is a legitimacy crisis?

Your own hon member said it.

On the one hand we laud our legal system and say that our legal system is held in very high esteem in the world, and on the other hand we keep on echoing, like a refrain, those who talk about the legitimacy of the legal system and who see it as a stumbling block. If we do that we are encouraging them. In our body politic the legal system is a last bastion in the eyes of many people. As long as the legal system and the administration of justice remain standing, this State will remain standing. That is why there is an onslaught on the administration of justice. That is why there is suspicion-mongering. If the judgment of a single magistrate or judge offends a person, and one implies that it is the entire system that is at fault, one is playing into the hands of those people.

I am not saying now that hon members cannot express their justified criticism. Yesterday I admitted that the hon member for Houghton was correct in respect of one matter. I said we could manage without it, and I say it again.

The fact remains that if we give up hope in regard to our legal system, we ought to be correct in our approach when we make analyses of the relationship between the various occupational groups. It is my department’s and my declared policy to maintain parity. There is parity in regard to salaries. We are also experiencing intimidation, but hon members must make an appeal to their people not to allow themselves to be intimidated.

That is why I liaise very easily with legal people, regardless of their colour. To me it makes no difference. A person is an attorney or he is an advocate. We have already had Indian people on the bench in an acting position. We have two silks who are Indians, and no one should turn this into a political issue, because I have already said that they qualify.

This brings me to the hon member for Sundays River, who inter alia spoke about Latin. I want to refer to the fact that the hon member for Sandton also discussed Latin. The hon member for Sandton and I have come a long way together.

†Without saying goodbye to him as though he is departing from Parliament, this Parliament as constituted—the way it operates in committees and the system generally—has given the hon member the opportunity to use his talents in the best interests of the Vote for which he is responsible.

When this system got off the ground we also started to realise that the hon member for Sandton was not just a politician and that he was actually dedicated to the cause of good legislation, and he has made most valuable contributions. Having said all this, I once had reason to write to him: “You bard of Sandton wrote blank verse and still blanker prose. Alas! Little else in his lexicon!”

*Questions have been asked about the Latin issue. I want to tell the hon member for Sandton what would happen if we were to come to Parliament with legislation containing my proposals, namely that the content of Latin required for admission for advocates need not be the same as that of Afrikaans and English; in other words, a lower course than what we term Latin I at our universities. This is a proposal which I have not merely suggested, but which I also said I would take to the Government as a proposal in reply to that question. If I were to come forward with such legislation, hon members of this Committee would have an opportunity to say whether they agree or not. Hon members will be able to reject that legislation, but if they do not reject it, its effect will be that the Appeal Court decision will remain standing, namely that as far as Afrikaans and English is concerned, university standard will still be required as admission for advocates. No one can dispute that.

As far as Latin is concerned, I indicated that there were sufficient indications that we could not write off or abandon Latin. The substance of the legislation which I intend submitting to the Cabinet will be that a course with a lower Latin content than Latin I will be required for the purposes of admission as advocate.

The question is whether we can now draw a line through Latin. Can I draw a line through Latin if it is apparent, from the firm evidence that I have obtained, that in 1988 there were no fewer than 5 000 Latin Special students in this country; if it appears that, as far as Latin I is concerned, there were more than 1 000 students? At that stage they were not compelled to take it, because at that stage they could still be admitted as advocates with simply a lower qualification.

Barely 100 advocates are admitted every year. In other words, students are studying Latin for their pleasure. [Interjections.] Some of the hon members are laughing; other hon members also laughed about this in the past, and then it appeared that Black people felt very aggrieved because the General Bar Council had said that Latin should be abandoned because Latin made it impossible for people of colour to be admitted. The suggestion, of course, was that they found Latin difficult.

†The hon member for Sandton did the same thing this morning. It smacks of a bit of paternalism. The University of the North has actually censured the General Bar Council for suggesting that they are unable to study Latin. [Interjections.] Yes, they were strongly censured.

*There are Bars that would like to retain Latin. It is not the general consensus among advocates that Latin I should be dropped. Consequently I shall carry out my intention, and if those Bar Councils still feel that way about this matter they will have the opportunity to give evidence in Parliament and to say whether they want the judgment of the Appeal Court to continue to apply, namely that Latin I ought to be retained, or whether they adopt the other school of thought, namely that a lower requirement for Latin should be laid down as admission for advocates.

†The hon member for Tongaat asked me about the state of emergency. I want to tell him that as long as we are still experiencing this very high incidence of violence and as we analyse the situation today, we cannot lift the state of emergency. If we do so, we shall be playing directly into the hands of those who strive towards upheaval and creating a situation where South Africa becomes ungovernable. This is my answer to him. On another occasion I will perhaps reply to him more comprehensively.

*The hon member for Vryburg raised the matter of criminal law procedures. The SA Law Commission has already constituted a new task force with a view to eliminating abuses in our criminal procedure law, but at the same time striving for a more streamlined law.

I come now to the hon member for Rosetten-ville. She debated in an impressive way on the question of child molestation and rape. Briefly I want to say that it is true that the Law Commission has made a great deal of progress with its investigation into the protection of child witnesses. With reference to a statement by Mr Justice Olivier it is very clear to me that the Law Commission, which met this week, is in fact going to publish a working document which will protect child witnesses in the sense that a child psychologist will act as intercessor and when the questioning takes place, use will be made of a one-way mirror. This sympathetic treatment by the questioner will create a more congenial atmosphere without confrontation taking place in court. In this way we will evidently have more witnesses who can help bring accused persons to book.

The hon member dealt more specifically with the sentences, however. In the time allotted I do not want to make an analysis of why every sentence differs from another. Sentences must differ, however, because the Appeal Court has said— on many occasions—that the criminal who is sentenced must be assessed according to the interests of the community, the interests of the criminal himself, and then, too, according to the nature of the offence. The result of this combination of factors is that a person imposing sentence will pass a different judgment every time. Then, too, there are circumstances that have to be taken into account, for example a person’s family, because if a person’s family is then going to become dependent on the State, the State has to care for them. That can happen.

I do not want to tell hon members that minimum sentences are the obvious answer. I think we should trust our courts with the discretion we have allowed them to have. We must very definitely not interfere in this. What I am saying to the hon member is that it is time this Parliament sent out a very clear signal to the outside world that child molesters will not be tolerated. That in itself is a very strong indication for those imposing sentences.

It is also true that we must obtain proper control over them. In the United Kingdom local authorities keep a register of child molesters. Perhaps we should think of conveying this to the Minister of Health Services and Welfare, so that the two of us can consider methods for keeping a proper register of these people.

Finally, I want to tell the hon member that it is also true that rehabilitation programmes are applied in prisons, but I do not want to say that they are adequate. I shall consider her ideas in the time which lies ahead.

Now I should like to turn to all the hon members who spoke very effectively about the report on group and individual rights, and the working document of the Law Commission. I should like to turn first to the hon member for Losberg. On 15 October 1986 his party was invited to submit comments to the Law Commission. His party was invited to do so by means of a letter addressed to the chief secretary of the CP. I think the CP should have informed that hon member and asked him to apply his very wide knowledge of the subject productively here. I think that should have happened. It is not through my doing or any omission on the part of the commission that this did not happen. I think it is a great pity … [Interjections.]

It is very difficult to speak to anyone with so many other debates being carried on at the same time, Mr Chairman.

I want to ask the hon member whether he is prepared to respond to the invitation of the commission to make a written or oral contribution before 31 August 1989. Thank you very much. The hon member said he was going to do so. Then that virtually concludes the debate as far as that opposition and I are concerned, because then he is heeding our appeal—my appeal—which was that this working document should not be politicised.

It is a scientific document. It is a document which the commission compiled after profound research into this subject. The hon member may be critical of the commission’s style—he himself is a scientist. I do not for one moment want to detract from that, but if he does not agree, and if he wants to adopt an analytical approach in his contribution and also concerning what they have already written, then I thank him for his intention to make a contribution. I want to tell the Committee that I expect a very good contribution from that hon member, because he is quoted in the commission’s report, in which it is stated:

That is true. Then they quote the professor, from his work ’n Nuwe Grondwetlike Bedeling vir Suid-Afrika, which demonstrates that the hon member is not talking about partition there, because one cannot deal with group rights in a partitioned set-up; one can only deal with them in a new South Africa.

The hon member asked me what had caused me to change from my view that I gave an instruction in 1986, but I want to ask the hon member what caused him to change his view that he believed exclusively in partition, and no longer in the protection of groups in South Africa. What is more, in the passage in which the hon member is quoted, he stated that he was also in favour of a bill of rights, provided it was not used to hide behind. [Interjections.] This commission’s report does not give anyone an opportunity to hide behind it. Is the hon member going to deviate from his standpoint? This debate was enlightening and extremely conducive to sound relations politics as well as to constitutional development in South Africa, and I shall tell the hon member why. The LP, through their leader in the Chamber of Parliament, pledged their full support for this report—with all its nuances, I take it. The DP did the same. The hon scientific member for Losberg has already declared himself in favour of a bill of rights and the protection of group rights or values—that has nothing to do with apartheid—and as a binding factor this document is a hair’s breadth away from what everyone in South Africa is seeking in order to strengthen us as South Africans. I am making an appeal to the CP. They have a very serious dilemma. Their partition policy brings them up to approximately the year 1975 or 1980, when the last Black state became independent.

1982.

Thank you very much, 1982. From then on there have been very few prospects, if any, for further independence. The choices are very simple. Either there will be domination, or the CP will have to find a constitutional model which will prevent groups from dominating one another.

Within a unitary state?

Consequently there is a search for such protection of groups within a unitary state. The Law Commission did not work out this matter in regard to the constitutionalpolitical situation, since that was not included in their terms of reference. They did in fact institute an investigation into group values, cultural values, etc. I believe that the hon member for Losberg can help to write history and at the same time he can help to deliver his party from a very serious dilemma.

There are quite a number of other hon members to whom I have to react. I just want to tell the hon member for Houghton that the commission she had in mind cannot be appointed.

†It is not possible to appoint such a commission. If it is a matter that rests with another Minister I only react to requests for investigation by a law commission if that Minister requests me to do so. In this particular case the question the hon member raised falls within the ambit of the powers and responsibilities of the hon the Minister of National Health and Population Development. I suggest that she approaches him again in the same amiable manner she has approached me. Perhaps this time she will succeed in persuading him.

I do not like him as much as I like you! [Interjections.]

Mr Chairman, it is always a pleasure for me to take part in this debate, the main reason being that the hon the Minister is a “baie goeie man” and his department is always ready to help. This has been my experience and I am not saying it because the hon member for Houghton yesterday said that he is the best Minister of Justice in the past 40 years.

Last year during this debate I had a White attorney practising in Cape Town and I invited him for lunch and asked him to come to the debate as an observer. During lunch I asked him whether there was any matter which he would like me to take up in the debate. He wanted me to ask the hon the Minister when he was going to appoint a senior council from the Cape Province as a judge in the Supreme Court of the Cape of Good Hope.

I raised this matter and was pleased to read about two months ago that the hon the Minister had appointed Dr Wilfred Cooper as a judge on the Bench of the Eastern Province Division of the Supreme Court.

This afternoon I would like to say things which I normally say last, because in the Budget Votes of the Departments of Defence and Law and Order I did not reach the last part of my speech due to time constraints.

After my maiden speech on this Vote in 1985 the hon the Minister sent me an envelope with a note which read: “To the hon member for Umzinto, for a very good speech.” Inside the envelope was a sweet. I still have the envelope, but not the sweet! Since then I have not seen or heard of any general affairs Minister giving sweets to any hon members from the House of Delegates. Judging by their present behaviour they certainly do not deserve it.

Last Thursday, 20 April, my colleague, the hon member for North Coast, phoned me from Tongaat at about 04h45. He told me that an old man had passed away and that his son was in the Modderbee Prison in Benoni and that he was due to be released on parole on 15 May, which is next month. He asked me to contact the Prisons Service and request them to release him so that he could attend his father’s funeral.

At 05h50 I phoned Brigadier De Bruyn and apologised for getting him out of bed, but he said very politely that he was already up. I told him of the problem and he said that he would look into the matter as soon as he got into his office. During the course of the morning and after a few phone calls between Lieutenant Koekemoer and myself I was informed that they had decided not only to release him but also to bring forward his date of parole to 20 April and that we were to pick him up at the prison.

This is what I call absolute magic. Sometimes one goes into an engineering shop and one sees a little notice which reads something like this: “The impossible we do right away; miracles take a little longer.” However, this department does both immediately.

I want to place on record my sincere thanks and appreciation to the hon the Minister, the Commissioner, Lieutenant General Willemse, Brigadier De Bruyn, Lieutenant Koekemoer and other members of the Prisons Service for the humane, compassionate and expeditious way in which my request was handled. I am sure the hon the Minister must be proud of the calibre of the people he has in his department.

Some Ministers, members and administrative staff of the Administration: House of Delegates should be sent to prison as well, not for punishment, but to be disciplined and to learn basic human relations. Where are they this morning? How many are here in this House? They have all gone home and I hope that they remain there, particularly after the elections. [Interjections.]

I would like to congratulate the hon the Minister for announcing that he is setting up the machinery for community service sentences, which is highly commendable. All too often a jail sentence is as much a punishment for the family of the prisoner as it is for the prisoner. It is also a burden on the taxpayer and society. Community service will contribute to cutting the country’s average prison population, which in December 1988 was 109 924 convicts cramped into accommodation designed for 83 895. I will come back to the overcrowding of our prisons if time permits.

Naturally, punishment and the need for public protection have to be taken into account, but those criteria can be met with an efficiently administered and monitored system of community service, which the hon the Minister sees as a constructive option for certain types of offenders who would gain nothing from going to jail and who pose no threat to other people. I believe the plan is to appoint a co-ordinator in every magisterial district to get things moving. This is a step in the right direction.

It is encouraging to note that religion is taken seriously by the department in that a Religious Care Division has been established to organise and control religious care service and to provide suitable religious care programmes. It is said that a man’s calamity is God’s opportunity. Is it not true that all of us turn to God when we have problems? I strongly believe that there is only one God, the God of love, and that there is only one religion, the religion of love. I appeal to the hon the Minister to appoint people of any religious denomination and any colour if they wish to conduct religious services at prisons.

I note from the report that an amount of R19 591 500 was spent by the department on its own building works during the year under review. A further amount of R63 337 500 was spent in respect of services on contract, and R873 267 was spent for new small works services.

I now turn my attention to the Umzinto Prison. Earthworks, drainage etc have been completed, and I wish to know from the hon the Minister when the building work is likely to commence. I appeal to him to put this high on his priority list because the Umzinto Prison is very old. It was erected in 1857, and a tender was awarded for the princely sum of £555 to Messrs Dacomb, Hewett and Landers. In spite of it being 132 years old, this prison is well-kept and maintained.

I have established that it was originally known as the Alexandra County Prison, and that its first chief warder was a Mr Paglar, and rebel war prisoners were kept there. Today we call them political prisoners.

I wish to reiterate what I said during previous debates, namely that this old prison should be preserved and declared a national monument for the sake of future generations.

I have looked at the conditions and criteria of the National Monuments Council, and they provide among other things that a building or any other relic which has been declared a monument is protected and will remain protected for posterity by proclamation. It is stated further that no monument may be damaged, removed, demolished or structurally altered without prior written consent of the National Monuments Council. A proclaimed monument obviously remains the property of the owner and he retains, as before proclamation, his full ownership rights thereto. Therefore I do not foresee any problem with this request.

I said that I would come back to the question of overcrowding in our prisons. There are some people who just love going back to our prisons because they receive five-star treatment and excellent training opportunities and health care, which most of them cannot afford in ordinary life. Training is given in many fields, including hairdressing, painting, decorating, carpentry, plumbing, bricklaying and plastering, to name but a few and, in addition, specialised training was given to 2 052 prisoners as at 30 June 1988 as chefs, waiters and braille transcribers etc. I think the Department of Manpower should subsidise the SA Prisons Service instead of pouring money into the special work of job creation which is being abused.

I wish to quote from a magazine known as Frontline. Two journalists were invited to inspect a prison and they chose to go to Diepkloof Prison. The magazine comments as follows:

The article goes on as follows:

[Time expired.]

Mr Chairman, I can tell the hon member for Umzinto that I do not have sweets like the hon the Minister, but I can definitely congratulate him on another good speech.

*At the beginning of the debate on the Prisons Service, I cannot but congratulate the Commissioner, Gen Willemse, most sincerely on behalf of this side of the House on his appointment to the rank of Director-General.

During the past few years we have seen how the Prisons Service has flourished under the dynamic and capable leadership of the Commissioner. His style of management has achieved great success. I can describe his style of management as one of team management, through which he tries to involve the entire service in actively pursuing certain goals. This is not easy. One is working here with 20 000 people from the highest rank to the lowest rank and it is difficult to get those people to pursue a specific goal with determination. Yet he has succeeded in doing that.

The one characteristic of Gen Willemse which I appreciate, which is apparent from the annual reports over the years and also from experiences which I have had with him and the service, is that he has always cultivated a critical attitude in respect of the existing systems and the existing organisation of the service, and that he constantly and continually initiated a critical investigation into the system. This is again reflected in the present annual report. It is because this critical attitude exists, that there has been a constant improvement in the service.

I want to congratulate the general most sincerely on behalf of this side of the House. We are also grateful on his behalf, because we know that he deserves it.

I also want to take this opportunity to thank Brig Henk Bruyn very much for his effective and friendly service over many years. This is his last year of parliamentary service, and he gave us nine years of service. I want to wish him everything of the best in his new position of command and I want to tell him that we are definitely going to miss him in Parliament.

As regards the annual report, there is one matter which makes a very strong impression. This is the tremendous progress which has been made with education programmes. During the year under review there was an increase of 94% in the number of students. There was an increase of 38% in the number of certificates awarded. In respect of the education programme for Blacks, the increase was more than 100%. During the previous year 1 009 persons were involved in this and during the past year 2 650 were involved. A total of 470 certificates were awarded as against 306 the previous year.

The education programme for Coloured prisoners was even more impressive with a growth of more than 200%. The number of students rose from 161 to 557. As regards the literacy programme, there was also an increase of more than 50% from 2 019 to 3 026 students. As regards vocational training, 2 500 persons were involved, 125 persons took trade tests and 72 passed. There were also 2 052 prisoners involved in specialised training. If one takes all these facets into account, as well as the tremendous growth in the number of students of more than 92% from an already high base, this is nothing short of impressive. This was done with limited manpower and without a significant increase in the manpower with regard to this matter.

A further dramatic improvement was the decrease in the number of escapes. It is almost unbelievable that this could have happened, because between 1978 and last year, there has been—except for one year—a decline every year. In 1978 the total was still 1 781 and this dropped to 963 in 1986-87 and during the last year under review it dropped by a further 30% from 963 to 702. This happened although the number of prisoners increased significantly during that period and this simply proves yet again the increasingly effective way in which the service fulfils its primary function.

I do not have the time to discuss the report any further, but I simply have to compliment every member of the Prisons Service on the way in which the service was operated during the past year. This is a difficult matter, because one is working with difficult people and the fact that there are so few problems and that so few problems cropped up, is proof of how effectively this service is operated.

Accommodation remains a problem, but everything possible is being done within the financial limitations to expand accommodation. However, this is not the only solution. Alternative imprisonment must also be considered and there is already a movement in this regard. There is a strong trend towards the sentences of the prison population becoming longer. In other words, only people who really must be there, are in prison.

Reference has already been made in this debate to the release of Mr Nelson Mandela and for that reason it is important for us to take a closer look at the considerations and circumstances of his possible release. On the one hand it must be said that Mr Mandela’s detention is definitely unique. It has an international dimension and it has a security dimension apart from other dimensions. In this connection, one can refer to what the hon the State President said earlier this year in the debate on his Vote, and I quote:

There are therefore factors with regard to his detention which do not apply to other prisoners, at least not to that extent. However, as far as the procedure is concerned, his case is precisely the same as that of any other prisoner.

In this regard, I should like to draw the attention of the House to the different release advisory bodies which are involved in the release of other prisoners as well as his release. These prison advisory bodies interact on an ongoing basis and give advice to the Commissioner and the hon the Minister. The first body is the institutional committee. Every prison has such a committee and it is constituted from the different disciplines, for example, social workers, educationists and, very important, members of the Prisons Service under whose supervision and control the relevant prisoner is. These committees play a very important role because their members have personal knowledge of the prisoner’s circumstances. This also plays an important role in the treatment of a prisoner during his imprisonment.

The next body which plays a role, is the Release Board, also known as the Parole Board. It is situated in Pretoria and considers all reports and inputs from the respective institutional committees in accordance with an established policy. It makes recommendations to the Minister or the Commissioner.

In addition to these two bodies, an advisory release board was also established in 1982. This was a consequence of the recommendations of the Viljoen Commission of Enquiry into the Penal System, which recommended that a central body should be established to ensure that there is co-ordination between the Bench and the prison authorities as regards the release of prisoners. The primary function of the … [Time expired.]

Mr Chairman, it is a pleasure to speak after the hon the chairman of the joint committee. I should like to express my good wishes to the officials and thank them for the way in which they drew up the report this time. When one takes this report, and one goes back, one can see that there has been positive reform in our prisons.

I must tell hon members this anecdote. I attended a meeting of taxi owners. One of the chaps came to me and told me there was someone outside who wanted to talk to me. I said we could talk once we had finished. This person is a long-term prisoner who was released from prison and established himself at the station as a “rank marshall”. This person is full of tattoos and it is difficult for him to find work. He said to me: “Mr Isaacs, I have a problem. I want to become part of the community again, but it is difficult to find work. I really want to, but I have problems and I do not want to go back to prison.” He said, however: “I have no problem with prison, because prison is a creche these days!” [Interjections.]

Mr Chairman, when a prisoner tells one that prison is a creche, one must admit that there has been great change and reform. If prison is like a creche these days, I must tell the hon the Minister and his officials that this is a wonderful image that is presented to the public!

There is something that I should like to draw to the attention of the hon the Minister. I see that certain prisons have been closed. I am referring to prisons such as Davel, Driehoek, Rawson-ville, Simondium, Trichardt, Woestalleen and Koelenhof. Is it not possible for these prisons to be converted into training centres for our unskilled farm workers? The time has come for one to want to upgrade one’s farm workers, and this is a golden opportunity …

Or a proper college!

Yes, the hon member is correct. This is a golden opportunity to give these people that necessary training so that they can produce better work. In my opinion those places must be used in such a way that they can make a further contribution to our farming.

I come back to a very sensitive matter with reference to tattoos. I know it is difficult—I went to the major to make some inquiries—to control tattooing. A prisoner is charged if he receives further tattoos, because prisoners are examined when they report. It is difficult to control this, however, because they can hide their tattoos or go and sit somewhere where someone can tattoo them without being seen. These people are then released. It is expected that they will integrate into the community once again. They do not realise while they are sitting there, quite possibly frustrated, however …

[Inaudible.]

That hon member must rather keep quiet; they fought again at the branch meeting the other night. [Interjections.] That hon member will be tattooed, and I have his mark.

They come back and have to try to adapt to the community. They are so full of these tattoos, however, that the people in the community hesitate; they are afraid to take them back. They go to the employer. The employer looks them over from head to toe, and he is also worried and feels he cannot employ these people. I am sure they do not realise that they are condemning their own future when they tattoo themselves, because when they leave prison the community will not accept them easily.

I know this is difficult, but I want to ask the hon the Minister whether it is not possible to do something to make these people see sense, because in the end they are rejected completely by the community, they become the wrecks of the community and no one wants to touch them. They become the “untouchables”, and as a result they start forming gangs, which leads to even more crime than we are experiencing in our community already. Hon members know that gang crime is increasingly tremendously. That is why I am asking the hon the Minister to ensure that reform takes place in this sphere and that these prisoners are made to see sense in a psychological way so that they will stay as far away from tattooing as possible.

Mr Chairman, I also want to draw the attention of the hon the Minister to the question of people who are sentenced for six months or less. Many of the people in this group are guilty as a result of maintenance fees. An enormous burden is placed on the shoulders of the police when they have to take these people to court. The people are locked up or, in most cases, receive a suspended sentence. I wonder whether the hon the Minister would consider imposing alternative sentences, such as community service at fixed hours, with regard to these people. The reason for my request is that these people slip away from one place to another, and evade the police. Their families normally have good jobs, and if such a person can serve a sentence, with community service as an alternative sentence, he can make a contribution in this way. It is also very difficult for the police to trace some of these people.

I should like to draw the attention of the hon the Minister to paragraph 4.2.2.1, “Staff Turnover”, in the annual report of the Department of Justice. It is rather alarming to hear that the number of staff resignations has increased by almost 53%. I know there are young men who are very keen to enter the Prisons Service. It is a pity that we do not know how long these people were in service. The report points out that the long hours may be one of the reasons for the resignations. Is it not possible to investigate the large number of resignations? During the past financial year, 1 088 members resigned. Did these people not perhaps reach a stage at which they felt they were not being promoted because the highest ranks were so top heavy that nothing more could be done for them? I asked how many Coloured members had been promoted to the rank of colonel. The answer was that so far only one had been promoted to this rank. I think the time has come for my people also to be promoted to this rank. This person has been the only Coloured colonel for some years now. I think the time has come for the people in the lower ranks to receive the necessary encouragement and for there to be more promotions for our men in the Prisons Service.

Mr Chairman, I want to use this opportunity first of all to tell the hon the Minister that over the years that I have been visiting prisons—it is a long time, first starting way back after the Sharpeville problems in 1960—there has been a marked improvement in conditions in South African prisons. A good deal of that is due to this hon Minister who, as I say, has always championed the cause of prison reform, and I would like to give him credit for that. There are lots of things, of course, that still need to be attended to, but he has nevertheless introduced a lot of reforms.

I have over many years pleaded for the release of Mr Nelson Mandela, Mr Walter Sisulu and other so-called political prisoners who have been imprisoned for very many years. This appeal will continue for as long as these men are still incarcerated. I want now to extend that plea on behalf of other political prisoners.

I refer firstly to the women. Barbara Hogan and Ruth Gerhardt are both serving sentences at Pretoria Women’s Prison. Barbara Hogan has served more than seven years of the 10-year sentence imposed on her for aiding a banned organisation. There was no violence involved in her offence. To the best of my recollection the major offence was that she was passing on information about trade unions to the ANC. She has served something like seven and a half years of her 10-year sentence, and many people considered at the time that a 10-year sentence for that offence was a particularly savage one. I believe that she should be given remission now, and be allowed to return to society to resume normal life and to make use of the academic degrees that she has actually acquired since she went to jail.

The second woman is Mrs Ruth Gerhardt who was convicted of espionage. She is a Swiss citizen whose only child, a son of 12, lives with friends of the family in Bern. I saw her not too long ago, having been given permission to visit the women prisoners, and she very much desires to return to Switzerland so that she can be with her child, whose father incidentally is serving a life sentence at Pretoria Maximum Security Prison, also for espionage. She has served about half of the 10-year sentence which was imposed on her some years ago.

Then there are two male prisoners at Pretoria Maximum Security Prison whose cases I believe the hon the Minister should consider for remission.

I refer to Rob Adam who has now served more than seven years of his 10-year sentence, and Roland Hunter who has only six months of his five-year sentence still to serve. I think it would be a very humane gesture and timely, if I may say, for South Africa to give these prisoners a remission of sentence.

The other matter that I want to raise with the hon the Minister is his refusal to separate persons serving sentences as conscientious objectors from ordinary criminals. We know what happened to Dr Ivan Toms 11 months after the hon the Minister had turned down a request from his lawyers for a transfer to Pretoria Goal. He was assaulted by a psychopathic criminal at Pollsmoor Prison. There are others in the same category. I think of David Bruce, Charles Bester and Saul Batzofin, and there will no doubt be many more, as long as the Government refuses to allow alternative community service to those young men whose objections to military service are not based on religious grounds. This category of prisoners should on no account be kept with ordinary criminals. They are not ordinary criminals, as indeed the magistrate commented when he sentenced Dr Ivan Toms. They should be transferred and kept with the politicals at Pretoria, where at least they would be safe from the sort of assault that was suffered by Dr Ivan Toms. Better still, of course, would be if the hon the Minister would offer them alternative community service and persuade his colleague, the hon the Minister of Defence, to change the Defence Act so that that could be done.

I also want to take this opportunity to register my protest against the inhuman treatment of shackling detainee prisoners who are in hospital to their beds. I know it is said by the prison authorities that once the prisoners actually leave the prison they are no longer the responsibility of the prison themselves. It is nevertheless the hon the Minister’s responsibility.

They are there to prevent them from escaping!

I know it is to prevent them from escaping.

What do you suggest?

I suggest they be better guarded. That is the only way one can prevent them from escaping, rather than shackling them to the bed. It is quite inconceivable to me that sick men—these are persons not convicted of any crime; I am talking about the detainees—should be subjected to this sort of treatment. I very much hope that the hon the Minister of Justice and Prisons whose responsibility it is to look after the welfare of these people, no matter where they are, will immediately instruct his officials to desist from this practice if he has not already done so in view of public protest.

I am astonished that the doctors who are looking after these detainee patients have allowed them to be shackled. I seem to remember in the dim and distant days of the framing of the emergency regulations about three years ago that the method and handling of detainee patients was supposed to be approved by the medical men under whose care they are while they are sick. Have the medical men actually given permission that these people should be shackled to their beds while they are under their care?

I want to draw the hon the Minister’s attention to a problem I have mentioned before, namely the special problem regarding awaiting-trial prisoners. As we know—with the courts cluttered up as they are—some of these people wait many months and indeed some for over a year before they come to trial. They are unconvicted. They have not yet been convicted of any offence. They spend those months in prison doing exactly nothing, with little or no recreation, no study facilities and no productive employment. In the case of the Blacks in the jails that I have visited, they are locked in crowded cells for most of the day. It should not be beyond the ingenuity of the department to do something to improve the conditions of the more than 20 000 unconvicted prisoners—according to the latest report—who are languishing under these conditions in jails throughout the Republic.

In reply to the hon member for Sandton earlier this year, the hon the Minister submitted a lengthy list of overpopulated prisons. I see that that list has been published in the newspapers over the past day or two. When one analyses those figures a little further one finds that four prisons were overpopulated by more than 90%. Pollsmoor Maximum Prison, as has been mentioned in the Press, is overpopulated by over 99%. Nine prisons are overpopulated by more than 80%; 17 by more than 70%; 15 by more than 60% and 18 by more than 50%.

I know the department is strapped for funds. I know the problem is that there are not enough institutions to house these prisoners properly. However, there is also no doubt that overcrowding makes it that much more difficult to maintain discipline and control. Of the total number of 108 435 prisoners in jail as at 31 December 1988, perhaps the hon the Minister could consider parole for first offenders and also for the approximately 30% of those in jail who are serving sentences of up to six months. Therefore it seems to me that their offences could not have been very serious offences.

There are 673 young people under the age of 18—children according to our Children’s Act— who are serving sentences in ordinary prisons. This is simply not acceptable, despite efforts to keep them separate from adult criminals. I do know that a good start has been made with the Leeuwkop Juvenile Prison and now—a prison which we are going to visit shortly— the Pollsmoor Juvenile Prison.

Finally, I would like to ask the hon the Minister why it is that the Red Cross have discontinued the visits that they used to pay annually to our prisons. If anything, I believe we should extend this system of prison visits rather than in any way curtailing them. I do not know whether it is the hon the Minister or the Red Cross themselves who have curtailed the visits. [Time expired.]

Mr Chairman, it is a great privilege to participate in this debate this afternoon, especially because I have great appreciation for the hon the Minister—not only for the work he does, but also as the leader of my province. I am very grateful to hear that the hon member for Houghton shares my feeling. Coming from her, with her experience, it is quite a mouthful.

I also regard it as a privilege to take part in the debate, because over the past two and a half years I have developed great appreciation for the work done by Gen Willemse, his staff and every warder, especially after having become involved in two of the large prisons in my constituency, viz Grootvlei, near Bloemfontein, under the competent command of Col Goodchild, and the Goe-demoed Prison under the command of the energetic Col Lood Brink. Of course, both have been in the news recently. First of all it was Grootvlei, in connection with the hunger strike, which ironically focused attention on the Free State as South Africa’s pantry. Goedemoed was in the news because the only serious incident of violence took place there on 30 July last year. I spoke to a warder who had been the hostage of a merciless gang for a day. I took his hand and looked into his eyes, and I got some idea of what the work of a warder comprises—the challenges and dangers involved. This renewed my admiration for the important work done by this important leg of our security services. Since the matter is sub judice, I shall leave it at that.

I have no doubt, however, that this incident can be linked to gang activities. This phenomenon has excited my interest. It covers a very large area in itself and I do not want to talk about that this afternoon. We in South Africa can be proud of the effective system developed by the SA Prisons Service, not only to deal with this phenomenon, but also to neutralise it to a great extent. An HSRC investigation in 1984 led to the further refinement of the system. It makes use of two basic premises, viz disciplinary action for deterrent purposes on the one hand and rehabilitation and prevention on the other. If, however, one talks to the officers commanding and the staff, one realises that the real successes have been attained by the high standard of the professional warders … [Interjections.]

Order! The hon member for Nigel is talking so loudly that I can hear him from the Chair. He must please contain himself. The hon member for Smithfield may proceed.

… and on the other, taking into account that the Prisons Service gets to know the shady side of society, the way in which prisoners’ human dignity is acknowledged. In the third place there is their excellent contingency planning.

†Our prisons really deserve the world’s admiration for the way in which they have succeeded in complying with the UN’s Rule 71(4), which reads:

*In my opinion the great success attained by the SA Prisons Service in this connection is to a great extent a result of the role played by prison farms in the whole set-up. The 16 prison farms countrywide create work and training opportunities for 7 500 prisoners every year of whom 4 500 are involved in agriculture every day. The way in which they are constructively kept busy in the open air has a beneficial effect and therapeutic value in itself. Ultimately the prison farms provide agriculture with a large number of workers.

A further benefit is that a wide range of agricultural products are produced in an extremely economic and effective way as prison rations. If these food commodities had to be purchased on the free market, the cost last year would have amounted to R22,7 million. The expenditure on the agriculture budget amounted to R15,8 million—a saving for the taxpayer of R7 million, apart from all the other benefits I have mentioned.

I should like to single out one of these prison farms just for a moment, viz Goedemoed Prison Farm, because it is only 30 kilometres from my farm and I know the circumstances there well. Up to 1954 it was a DR Church labour colony. Subsequently it was taken over by the State. This beautiful farm on the banks of the Orange River covers 6 800 hectares of land. It contains two medium security institutions with 1 600 prisoners and a staff of 217 White and 164 Black warders.

The agricultural section is responsible for the creation and utilisation of work and training opportunities. A total of 583 prisoners are supplied with work here daily, of whom 367 are used in agriculture. The agricultural staff consists of one graduate agriculturist and seven agricultural technicians. On the farm 355 hectares of the finest irrigation land on the banks of the Orange River is cultivated. The following products were harvested during the past financial year: 348 000 liters of milk, 25 000 kilograms of beef, 31 000 kilograms of mutton, 51 000 kilograms of pork, 325 000 kilograms of vegetables and 4 500 kilograms of fruit; in addition there was 302 tons of kernel corn and 1 500 tons of coarse fodder.

Since Grootvlei has more or less the same proportional achievements in the sphere of agriculture, I shall not repeat the details involved there. In a regional context, these two farms make a positive contribution to relieving the detention costs of prisoners in the other centres. Their refrigerated trucks transport meat up to Kroonstad. This also has a great influence on the economy of the region, as well as on the community with regard to the schools, the churches and the community life in that area. There is to be a big social occasion at Goede-moed on Monday night, 2 May, for example— something I try not to miss.

What really impresses me as a farmer, however, is the way in which use is made of scientific farming techniques and principles in the process of striving for optimum utilisation of resources in order to achieve certain objectives in agriculture. These agriculturists can tell one exactly what every kilogram of meat costs, for example, how this compares with the previous year’s achievements, and how it compares with other farms of the same size. In order to monitor the results effectively, use is also made of external schemes such as pork improvement, the handling of milk, meat and small stock performance schemes. Just like all the other farms, these farms are also involved in animal health programmes. No wonder that numerous farmers’ groups visit these two farms annually, for the specific purpose of going to learn something.

These farms therefore make an immense contribution within the broad context of agriculture. It was really a privilege to get to know these two proud institutions with their staff. One of the big highlights this year was a tour through Goede-moed’s farming set-up with Col Lood Brink. I was tremendously impressed by the beautiful animals and the agricultural products I saw on the lands that day. If that is indicative of what is taking place on the prison farms countrywide, it is really a proud showpiece for the Prisons Service.

It was my privilege to be the representative of these two institutions in this Committee, and it is with great pleasure that I support this Vote.

Mr Chairman, I would like to echo what the hon member for Houghton said about conditions in prisons these days. Certainly conditions have been vastly improved since the time I had a spell in prison.

I must immediately tell hon members that I went to gaol not because of any criminal activity but simply as part of the protest against racial discrimination.

The Report of the Department of Justice contains a very significant statement, namely that the aim of the prison authorities is to promote order and safety in society by treating prisoners according to statutory prescriptions with a mandate, and I quote from p 82 of the report:

The hon the Minister has been heard before to say that the purpose of keeping people in gaol is no longer retributive; it is rehabilitative, corrective and I think he also said that it has a deterrent quality about it. I do not think one could quarrel with those sentiments. However, what about the human dignity of Ivan Toms? Ivan Toms committed no criminal offence which is a crime in any other country in the world; yet he was sentenced to imprisonment. [Interjections] The hon the Minister tells me the case is sub judice; therefore I will desist from making the comments I intended to make in that connection.

However, I would say the human dignity of every person is involved here, even those who are political detainees. I would say the human dignity of prisoners awaiting trial, as the hon member for Houghton pointed out, is also very much at stake. At the same time we have to bear in mind that the attitude of prison authorities today is different from the time when I was there. I still remember the man named De Beer, who used to say to us: “Bly stil, bliksem.” Sometimes he would say: “Bly stil, hond.” I do not think the present hon Minister will tolerate any conduct of that kind from any of the warders under his control. I do not think that at the present time so-called “trusties”, long-service prisoners who are in for rape, murder or serious crimes, are put in authority over short-term prisoners, which used to be the case when I was there. “Trusties” are the must untrustworthy people in any gaol and it has been proved time and time again that it is those “trusties” who perpetrate most of the crimes within the prison situation.

I think it is right that we should compliment the department on its endeavours to promote the literacy as well as the vocational training of prisoners. I was interested to notice that there are 3 117 prisoners who are studying for degrees. That is commendable. One prisoner, while a student at the University of Natal, failed all his exams because he was politically very active. However, when he went to Robben Island he completed the BA degree. After he had been discharged he came to see me and I arranged for a bursary for him. The man then completed his MA, after which he went to the United States and got a job as a professor. At least the prison helped that one man to become educated in the long term.

Notwithstanding that, thankfully, people are not being sent to gaol any more in terms of the pass laws, there are still too many prisoners. There are political detainees who never ought to be there. There are other prisoners who committed crimes not involving moral turpitude who are in gaol and who ought to be doing community service. If a person is sentenced for driving under the influence of alcohol it is better to have that person working in the casualty ward of a hospital than languishing in gaol. Certainly it would be better for him, his family, the community and cheaper for the State. This is why I would like to suggest for the hon the Minister’s consideration that in addition to having the Advisory Release Board, there should be a review board within the Prisons Service … [Time expired.]

Mr Chairman, I must agree with the hon member for Reservoir Hills that conditions in prison certainly seem to have improved greatly since I visited my detained clients in the seventies.

It seems to have fallen to my lot to speak about criminal justice in this debate, particularly about crimes committed against the weaker members of our society.

In this prisons section of the debate I would like to refer to the treatment of psychopaths within our penal system. The case of “Screwdriver” Van der Merwe, to whom the hon the Minister referred yesterday, who at the beginning of this year raped yet another two victims and murdered one, has outraged our community. After the incident was reported in the Press I was overwhelmed by calls and letters from individual women and women’s groups. I know that my female colleagues in Parliament had similar experiences.

This case raises again the question of how the Department of Justice and the Prisons Service can most effectively deal with the psychopath. Unfortunately, crimes of sex-related violence are on the increase in our society. Rapes of women of all population groups have risen by over 6%. In 1987 the figure for White women was 770 cases and this increased in 1988 to 819 cases, while for Coloured, Black and Indian women the figure increased from 17 375 to 18 549. Nicro claims that for every rape reported 20 others occur. Perhaps there is some truth in the claim by a group calling itself People Opposed to Women Abuse, that a woman is raped every eight minutes in South Africa. It does seem a horrifying statistic.

In Van der Merwe’s case, he became the scourge of Hillbrow when he raped numbers of women in brutal attacks. William “Screwdriver” Van der Merwe was sentenced to death in 1972. This sentence was commuted to 20 years on appeal. During the course of his imprisonment Van der Merwe was certified as a psychopath, treated over a period of five years at Zonderwater Prison and decertified at the end of that treatment, after which he spent a further five years in jail as a normal prisoner before being released after serving a total of fifteen years of his sentence.

The medical officer in charge of the psychopath section at Zonderwater Prison certified Van der Merwe as completely cured at the end of his treatment. Within two years of his release he raped twice and murdered once before himself being killed by one of his victims.

The “Screwdriver” Van der Merwe case and other similar cases raise questions about the procedures followed and the criteria employed by the Prisons Service for releasing on parole prisoners found guilty of violent crimes, particularly where rape is concerned and where those prisoners have a history of psychopathic disorder.

This is not to say that the prescribed procedures were not followed in Van der Merwe’s case. Very clearly they were. I have been through the reports myself and there is no doubt about that. Is there, however, not perhaps room for reassessing these procedures and the criteria for release?

Last week I visited Zonderwater Prison psychopath section where Van der Merwe had been detained and treated under the guidance of Brigadier Gert Jonker, Director of Psychological Services of the Prisons Service. It became very clear to me that there are a great many problems connected with the certification, treatment and eventual release of psychopaths within our penal system.

Some of the problems which we have to take account of are the following. Basically, South Africa has taken over its Mental Health Act from the United Kingdom. Psychopathic disorder is in fact the only mental illness defined in the Act as it is in the United Kingdom. In the meantime in the United States, the definition has been scrapped and replaced by the concept of personality disorder, which has caused a certain amount of confusion in our courts.

It is difficult, which is a good thing, to certify anyone as a psychopath, but the result is that though many of the inmates of Zonderwater Prison, for instance, have been identified as having psychopathic tendencies, very few can actually be certified and be admitted for treatment as these very stringent conditions are understandably set down. In fact, in the psychopath section at Zonderwater Prison at the moment, there are only 19 inmates, although it is designed for 93.

Treating a psychopath is extremely expensive. In terms of the programme followed at Zonderwater Prison it is actually 304% more expensive than the cost of keeping a normal prisoner. I believe the figure spent per inmate is in excess of R45 000 per annum.

According to the data available at present, in the case of decertified psychopaths there is a 31% recidivism rate within the first five years after release; in fact, it goes up to 36% among Whites.

With ordinary prisoners there is also an approximately 30% recidivism rate; in other words, as far as relapsing into a life of crime after release is concerned, there is really not much difference between those prisoners who have not been diagnosed and treated as psychopaths and those who have. That raises the question whether it is worth it. The prison authorities are beginning to think that the whole exercise is certainly not cost-effective.

What is being done in our prisons for psychopaths’ treatment is really among the best in the world, and I must say I was extremely impressed with what I saw at Zonderwater last week. I think we should realise, however, that what it is achieving is very limited. It is achieving really very disappointing results, possibly not warranting the expense.

Internationally the question of parole for these long-term prisoners is also being reassessed. In the United Kingdom the whole question of parole for long-term prisoners was treated in the Carlyle Report which was published in November last year. The thinking in that report seems to be that long-term prisoners in the UK—not short-term prisoners—are perhaps being released too early and that they certainly should not be released until at least half of their sentence has been completed. It was also found that, once released on parole, such prisoners should be much more stringently controlled.

The report says that the overriding criterion in a parole decision should be based on an evaluation of the risk to the public of the person committing further serious offences at a time when he would otherwise have been in prison—as Van der Merwe would otherwise have been—as against the benefit to him and the public if he should be released.

In conclusion I would say that the present position is clearly unsatisfactory. I should therefore like to ask the hon the Minister whether it would not be possible to launch an investigation into the question of the sentencing and the treatment, as well as the possible parole of long-term prisoners sentenced for violent crimes. I know he has been asked to do a lot of investigations, but I really feel that such an investigation would be very worthwhile under the circumstances. It could include the question of certifying and treating the psychopath, a possible register to be kept of these people, the question of how long and on what basis they should be institutionalised, and—I think this is most important—a system of monitoring the people concerned. This monitoring could possibly be continued after their release, whether it is on parole, or after completion of sentence.

I really feel that all possible steps should be taken to protect the public from another Van der Merwe.

Mr Chairman, at the outset I should like to congratulate the hon the Minister and the Commissioner on a very comprehensive annual report on the activities of the South African Prisons Service.

It is only when one studies the report and realises that the SA Prisons Service does duty at more than 240 prisons countrywide, and takes care of approximately 113 000 prisoners every day, that one realises the extent of the activities of the service. The budget for the Prisons Service for the present financial year amounts to more than R750 million.

I wonder whether it is possible for the hon the Minister to indicate what he envisages when he submits in the explanatory memorandum that he tabled with the budget that he wants to peg the prison population at 113 500 during the present financial year. How does the hon the Minister envisage doing that?

I want to carry on. With the extent of the activities in mind, it is my observation that the SA Prisons Service is very effective, otherwise the amount voted in this budget would have had to be much higher. I think the public and the taxpayers are greatly indebted to our Prisons Service for the way in which they do their work.

This brings me to the staff of the service. Many people wonder what a warder or wardress does. Obviously the safeguarding of prisoners is their first duty, but they also make a positive contribution to the care and treatment of the prisoners.

Because they are working with people, members of the Prisons Service do not always have an easy or simple task. Personality and particularly characteristics such as patience, leadership and adaptability play an important part in this regard. Team-work is important and members constantly have to rely on the support of their colleagues. Members of the SA Prisons Service, men as well as women, come from all population groups of the RSA.

There is probably no better illustration of the importance of the part played by the modem professional warder or wardress in the SA Prisons Service than the comprehensive training members receive at the beginning of and during various stages of their careers. As probationary warders or wardresses they work closely with the experienced members who gradually introduce them to the various aspects of their task. The member is subjected to basic training at one of the SA Prisons Service’s three training colleges which in the case of men lasts between five and six months and in the case of women approximately three months. It is an intensive course and comprises a stimulating few months, since the course is not only designed to train members, but also to reveal their potential as warders. Members receive theoretical as well as practical training.

With reference to theoretical training, the following orientation subjects are presented by well-trained instructors of the Prisons Service: Emergency action, purpose and function, organisation and activities of the SA Prisons Service, identification and handling of provocative conduct, preparedness, religious preparedness and relations. Probationary warders and wardresses are also examined in the following subjects: Compliments and saluting, institutional services, fire-fighting, etiquette and the Act and regulations. Practical training includes intensive training in the following: Squad drill, rifle drill, ceremonial drill, musketry, self-defence and physical education.

The purpose of this training is to give the probationary warder a broader understanding of the SA Prisons Service and its activities, as well as to equip him for the practical aspects of his task. After completion of the training period, probationary warders pass out at a passing-out parade, which parents are very welcome to attend, and are then stationed at the various prisons in the RSA or at Prison Headquarters.

Although a warder or wardress may be stationed at any prison in the RSA in accordance with the organisation’s needs, every possible consideration is given to personal circumstances and his or her own choice when a decision on placement is taken. If a member gives satisfactory service during the first 12 months, his or her appointment in the SA Prisons Service is confirmed.

One never really stops learning in the SA Prisons Service, and consequently members are given an opportunity to attend further training courses from time to time.

There is a variety of professions that can be followed in the SA Prisons Service and staff are appointed to the Prisons Service in various disciplines. Over and above the professional staff, whom most of us have dealings with in our daily comings and goings, staff in the disciplinary section can apply to work in one or another of the following institutions.

There is the dog section. Members who are interested may apply to be trained as dog handlers. Selected members undergo a course lasting approximately three months at the Prisons Service’s dog training centres and receive both practical and theoretical instruction in the handling of dogs.

Then there are catering courses. Members with an aptitude for and interest and/or experience in catering are selected to attend courses in catering. After the successful completion of such a course, these members are responsible for the preparation of food for prisoners; the preparation of food for members in messes; the training of prisoners as cooks and waiters; the granting of assistance in Prisons Service canteens, etc.

We have heard that the SA Prisons Service has various prison farms where prisoners are trained in a variety of facets relating to agriculture. The Prisons Service employs qualified people who are placed in the agricultural section for this purpose. The agricultural staff plan and organise all facets of the Prisons Service’s agricultural activities with a view to being able to supply the daily food requirements of prisons themselves. This staff is also responsible for the training of prisoners in the various branches of agriculture.

Members who have the necessary aptitude for and interest in nursing may apply to be trained as nursing assistants. After selection they attend an appropriate course before being placed in prison hospitals. Under the supervision of district surgeons, members connected to this section are responsible for the nursing and treatment of prisoners who are ill. Selected staff may also take a three-year course in general nursing at a provincial hospital. Some women’s prisons make use of the services of qualified general nursing sisters and/or midwives. Female members are also used as nursing assistants in prison hospitals, however, and have to take the appropriate course mentioned above.

The following professions also exist in the SA Prisons Service: Social workers; psychologists; educationists and chaplains. There are also various other specialised sections such as logistics, finance, computerising, work study, etc. One can really say that the possibilities in the SA Prisons Service are unlimited.

I think the staff of the service are a special and proud group of people who do their work in difficult circumstances and with distinction. One must always remember, however, that people end up in those institutions through no one’s fault but their own.

The members and officers of the SA Prisons Service are respected people in our society and I pay tribute today to the work done by each of them.

When one takes a look at everything that is taken into consideration when an applicant is offered an appointment in the Prisons Service, it is not strange that the personnel corps is of such high quality. Appointments are handled with the greatest circumspection, and an applicant has to comply with the following minimum requirements inter alia: An applicant must be a South African citizen; he must be physically and mentally sound; and he must have a strong personality. Attention is also given to the following general aspects: An applicant must have the ability and interest to work with people—that is one of the most important aspects of this work; he must be able to adapt to the military system of the SA Prisons Service; he must be loyal and must set a good example to others; he must be prepared to serve in any part of the Republic of South Africa; and he must be bilingual.

The Prisons Service has such a proud record and such a good image that many more applicants apply than can be appointed. I can definitely attest to that, because I try at every turn to persuade the Prisons Service to allow people to enter their service. Consequently I once again appeal to the hon the Minister and the Prisons Service to do everything in their power to accommodate the young people who try to join them. I want to ask them to work towards the further extension of the Prisons Service’s establishment. We must create even more posts, because there are numerous young matriculants who want to join the Prisons Service. I can give the Prisons Service lists and lists of young matriculants who want to join the Prisons Service to work there.

In addition I believe that our Prisons Service is completely short-staffed in comparison with prisons services abroad. This places enormous pressure on the existing staff and management. This good record of the Prisons Service must not be endangered because the ratio of the number of members to that of the prisoners is not improving, however. I recently read about the ratio of Prisons Service members to prisoners, and it was alarming to realise how poorly we compare with countries abroad in this connection.

In South Africa there is an average ratio of one member to 5,7 prisoners, whereas in Belgium the ratio is 1 to 1,6, in England 1 to 1,8 and in France 1 to 3,38. There are certain risks in operating a prison with insufficient staff. I am not saying, however, that our prisons are not operated effectively; on the contrary, we can be proud of our efficient Prisons Service, but we must look to the future.

If we have too few warders, we cannot operate new prisons. From answers and information provided by the hon the Minister, I conclude that we have far too few prisons in the Western Cape, and that there is a great need for more prisons in this region. Order and discipline, an aspect in which our Prisons Service stands head and shoulders above prisons abroad, cannot be maintained if the Prisons Service does not have sufficient members.

A shortage of members also holds the risk of escapes which can endanger the safety of the public. All too often a single sensational crime captures the imagination of the public, but they soon forget that the Prisons Service has to deal with the criminal for years.

Since I am talking about escapes, I want to reassure hon members. During the discussion of the hon the Minister’s Vote last year, I pointed out that escapes had shown a decrease of 44 in comparison with the previous year. The picture looks even better this year, and there is a decrease of 261 in comparison with the previous year. I thank the members of the Prisons Service for that. Someone has to thank these people sometimes! Consequently I want to avail myself of this opportunity to thank the staff of the Prisons Service.

In addition a shortage of personnel takes its toll with regard to the unproductivity of prisoners. The more members are available to keep prisoners productively busy, the more prisoners can work every day. Apart from granting relief to the Treasury, this will also result in prisoners receiving more varied training.

The hon the Minister recently invited us to visit the Pollsmoor prison. I want to thank the hon the Minister for the opportunity to see ourselves what is being done. I saw throughout that the staff are competent and that each one knows what he is doing. I also want to thank the Prisons Service for its policy of training staff and motivating them to follow courses and improve their qualifications. The annual report describes what is being done in the sphere of manpower utilisation and planning. This is an example to numerous other organisations.

I also see that according to the report, the Prisons Service’s establishment makes no distinction between population groups. Everyone can compete on the principle of merit and efficiency. I am convinced that this integrated establishment is one of the reasons for the Prisons Service being such a popular employer. I do not think there are many other Government departments that can hold a candle to the Prisons Service with regard to the training, selection and evaluation of their staff. This is linked to a constant evaluation of staff, so that only the best people can be selected.

Staff evaluation is an aspect which receives high priority in the SA Prisons Service. Staff evaluation has the objective of determining the relative competence of the staff, and therefore the emphasis is on functioning achievement. It also serves as an aid in determining promotability; possible remuneration in recognition of achievement; the transfer of staff; the identification of high-level management staff; and the determination of the training and development needs of under-achievers in particular. During the evaluation process staff—members and officers—are evaluated with regard to three dimensions—viz the ability to work, the ability to adapt and their management ability.

Under the ability to work, strict attention is given to aspects such as the quality of service, discipline—on which a high premium is placed— diligence and purposefulness, as well as numerous other aspects. The ability to adapt deals with the ability of the officer or member to hold his or her own in various situations, as well as adaptability in general. This is a very important dimension in a profession in the Prisons Service because of the variety which one comes into contact with on all levels of society every day. One has a variety of people in a prison, after all, and there is also liaison between the staff and the public on all kinds of matters.

Management ability, the third dimension, deals with the management skills of a certain officer or member, and here training and further study are important. Since management skills can be learnt and are becoming more and more important these days, the Prisons Service has established a number of management courses which have to be taken by an officer or member at a certain stage in his career. I want to appeal to members of the Prisons Service to make use of their opportunities and to ensure that they make progress and are selected.

I am also aware, however, that the management of the Prisons Service does a great deal to encourage their staff to attain post-school qualifications. Once again I want to appeal to members of the Prisons Service to make use of this opportunity. The Prisons Service is one of the few departments which has a study fund, financed by the members, to provide members with interest-free study loans in order to enable them to study further. Everyone, irrespective of rank, sex or population group, comes into consideration for this. Once again I request that the members make use of these opportunities.

A further aspect that I should like to emphasise here today, is the position of the Prisons Service in the Parliamentary set-up. The Prisons Service is undeniably part of the security services, and with the other services it forms a unit against lawlessness. I find it strange, however, that in some Houses of Parliament, the Prisons Service falls under the House Committee on Justice, whereas in my opinion it should rather fall under the House Committee on Security Services. This argument also applies with regard to the joint committees.

In the House of Representatives, the Prisons Service already falls under the House Committee on Security Services. In my opinion, because of its purpose and functions, the Prisons Service should definitely fall under this committee, and I trust that the other Houses will follow our example in this connection by discussing this subject under security services, and that this will also be the case in the Joint Committee on Security Services. [Time expired.]

Mr Chairman, it is a pleasure to speak after the hon member for Robertson, and I want to tell the Commissioner of Prisons, Gen Willemse, that he should consider appointing the hon member as a publicity officer for his department. He definitely has a good friend in the hon member for Robertson. [Interjections.]

The prison system in the RSA has been functioning for the past 30 years since the implementation of the Prisons Act in its present format. Existing legislation, policy and approach are closely related to United Nations directives on the treatment of offenders. These directives are contained in a document entitled “Standard minimal rules for the treatment of prisoners” which appeared in 1984.

In the limited time at my disposal, I shall attempt to give a survey of the historic developments and approaches to the treatment of prisoners, after which I shall indicate where the South African Prisons Service finds itself at present in terms of its approach.

Before 1870, the so-called classical period, the pure penal model was accepted world-wide as the only workable approach in dealing with and treating prisoners. This model was based on the principle that punishment as such is enough to effect rehabilitation. Prisoners were therefore regularly subjected to physical measures, such as corporal punishment.

Other models emerged in concurrence with the pure penal model, during this period. I should like to refer to the incarceration model in terms of which punishment, hard labour and solitary confinement were the answer, the labour ethic model in terms of which labour was presented as being the key to changed behaviour, and the vocational model in terms of which confinement and idleness had to be prevented by providing prisoners with professional training in order to prepare them for re-entry into society.

A congress of the Penitentiary and Reformatory Discipline in 1870 led to a new approach in terms of which models were established in which behavioural change came about by means of influencing. It was no longer left to the prisoners to improve themselves.

With the advent of the 20th century, the emphasis shifts to the treatment of offenders on an individual basis. This period, known as the progressive era, laid the cornerstone for the establishment of the modern correctional frameworks for dealing with prisoners. The year 1920 heralded the period of the medical model and the rehabilitation of prisoners in prisons. The prison environment was converted into a hospital milieu during this period in order to provide diagnostic and observation facilities for all studies.

In the sixties, however, it was realised that recidivism could not be kept in check by institutional treatment. The artificial environment and negative subculture of prisons is not suitable for the treatment of offenders with a view to their successful adaptation in society. In 1965 the reintegration model emerged, in which greater emphasis was placed on the re-entry of offenders into the community. According to advocates of the modern rehabilitation philosophy, the endeavour is to change the prisoner’s attitude, character and perceptible behaviour, and to assist him in his endeavour to being accepted socially by the community. As a result the rehabilitation concept and rehabilitation programmes gained new meaning.

Aspects of the various models such as the medical, adaptation and reintegration models are used, and the positive characteristics of this approach are the hope and prospect of change, upliftment and self-improvement that are given to a prisoner.

During the early sixties, there was also the justice model. This model is based on the just treatment of the prisoner, and any discretion on the part of the authority is drastically restricted or eliminated. Parole and indefinite sentences inter alia are dispensed with. The over-emphasis of this model led to an excessive obsession with prisoners’ rights, however, and consequently one can justifiably ask whether the administration of justice without discretion can function successfully.

The utilistic penal model is an extension of the classical model to which I have referred, and this entailed that punishment as a deterrent was supplemented by an attempt to rehabilitation which would benefit the community. The most significant criticism against the system, however, was based on the fact that it would not be fair to punish an offender for any reason other than that crime itself deserves punishment.

The neo-utilistic penal philosophy emerged in 1975 with the argument that if prisoners could not be rehabilitated they should be kept in safe custody to serve as a deterrent for potential offenders. The premise is that punishment deters criminal behaviour and has a moral and educational value. According to this philosophy the purpose of punishment is to teach the offender to restrain himself from crime, whereas it also serves as a warning to the potential criminal against the consequences of crime. This philosophy enjoys popularity because there is consensus that crime deserves punishment and the community is entitled to the protection and maintenance of order. This model represents a repressive reaction to crime, however, which did not succeed in controlling the problem of crime in the past.

The SA Prisons Service is a modern and dynamic institution which takes thorough cognisance of developments elsewhere in the world. A sober, practice-orientated approach to the treatment and rehabilitation of prisoners, which takes the various models into account, is followed. Prisoners are given sufficient opportunities with regard to self-improvement and self-training, and attempts are made throughout to maintain a balance between the interests of the community and those of the prisoners.

The SA Prisons Service places a high premium on the professional and humane handling of and treatment of prisoners. This also takes place in accordance with the provisions of the Prisons Act of 1959 and the regulations promulgated in terms of this Act. The Prisons Service has no miracle solution by which criminals can be rehabilitated overnight. Nor can they guarantee that former prisoners will not commit crimes again. Our Prisons Service focuses on the humane treatment of all prisoners in an orderly, disciplined environment.

A wide variety of rehabilitation-orientated programmes are offered in accordance with this. The emphasis is on an individual approach and flexible policy with the main objective being the safe custody of the prisoner to protect the community at least for the duration of the sentence. As a result the Prisons Service’s attempt to operate rehabilitating programmes so that prisoners can improve themselves is of the utmost importance. The public must know, however, that they should not expect unrealistic results.

As I indicated in my speech, man seeks models to deal with crime and the criminal. The answer is definitely not a simplistic one. The enthusiasm and dedication of prison staff deserve the support and thanks of all of us.

Mr Chairman, I want to compliment the hon the Minister and his department on bringing about greater improvements as far as the prisons are concerned. One would have noticed prisoners were mainly used to carry out unskilled hard labour with a view to punishment. This had no real rehabilitative values as it was regarded as part of punishment. With the more humane views of imprisonment, training and training opportunities have found their niche in the Prison Service. This shift of emphasis has contributed to the fact that the viewpoints of prisoners should be changed from the hard labour concept to the experiencing of labour as an opportunity to improve their position not only in the prison but also after they are released.

In order to develop this basis the emphasis has also shifted from unskilled hard labour to skilled labour which enables a prisoner to make a positive contribution to socio-economic society upon his release from prison.

Due to the aforementioned objectives the Prison Service also endeavours to release as many qualified persons as possible into society after the expiration of their sentence not only to make a constructive contribution there, but also to earn an independent living free of crime or being a burden to another person. The training of prisoners therefore forms an important part in the prisoners’ total treatment programme.

Prisoners are allocated to the various fields of training on the basis of, amongst other things, their qualifications, previous experience, aptitude, ability and length of sentence. To assist them in their training programmes the prisoners are continuously encouraged to participate in an appropriate field of study and are also assisted by means of classroom tuition, personal study guidance and available educational facilities as well as specialised training to perform constructive unskilled labour. I will now give a brief perspective on each of these areas.

Vocational training implies training by which a prisoner can obtain a diploma or a certificate which enjoys national recognition without any mention that it was attained while serving a prison sentence.

Artisan training takes place in workshops or on construction sites under control of the Prisons Service. The SA Prisons Service at this stage is running six production workshops and nine textile workshops for women as well as a clothing and a shoe factory providing training and work opportunities for 2 108 prisoners. During the 1987-88 financial year R12,8 million worth of raw material was processed in SA prisons workshops, consisting of woodwork, for instance, tables, chairs etc, R1 137 022; metal work, such as prison windows, doors etc, R2 191 235; leather and related industries, for example, prisoners’ shoes, R3 078 369; textiles such as prisoners’ clothing, R5 486 130; and repairs and maintenance, R907 244. These items were produced for State departments, administrations and the TBVC countries as well as for the needs of the Prisons Service.

There are also eight building training centres which are used countrywide for training prisoners in various building trades. The utilisation of prisoner skills made it possible for buildings to the value of R19 590 000 to be erected in the year under review. Artisans of the Prisons Service are also at present engaged in erecting new prisons at various sites which will accommodate nearly 7 166 prisoners. Furthermore, an ongoing modernisation programme is implemented.

After the completion of this vocational training a prisoner takes a trade test which is conducted by the Central Organisation for Trade Tests, as is done in the case of any other artisan. If a prisoner is successful he is awarded a diploma on which it is not mentioned that his apprenticeship was completed whilst in prison.

During the year under review 125 prisoners, 72 of whom qualified as artisans, took trade tests. This represents a pass rate of 57,6%. A total of 723 prisoners were subjected to evaluation tests during the year and 583 passed. This represents a pass rate of 80,6%. The statistics of prisoners who had received vocational training up to 30 June 1988 are as follows: The total number of sheet-metal workers, spray painters, upholsterers, electricians, welders, joiners, motor mechanics, toolmakers, and blacksmiths was 2 548.

Specialised training implies training of a specialised nature in various fields for which a certificate is given by the Prisons Service, stating the work for which the prisoner has been trained and which is accepted in the free labour market. Examples are chefs, waiters, leather-workers, textile-workers, cane-workers and braille transcribers. This kind of training is essential to develop the skills of those prisoners who are not involved in vocational training, so that they will also be able to compete in the labour market. At this stage a total number of 2 052 prisoners are involved in such a programme.

Prisoners classified in the category of constructive unskilled work do work for which no formal training is given. However, on-the-job training does take place, particularly if the prisoner has never done this type of work before. For instance, 7 368 prisoners work daily on 16 prison farms where they receive informal training in a variety of agricultural projects. The following products were produced: Vegetables, pork, beef, mutton, chicken, eggs and animal feed. Products to the value of R22,7 million were produced in the 1987/88 financial year and were mainly used as rations for prisoners.

Much is being done at this stage. However, changes are taking place in training in the country as a whole. In this change of approach, theory may become more important. Modular training is being introduced by the National Training Board where one aspect of artisan training at a time can be completed. The training of artisans may in future be regulated to a greater extent by the industries in which the skills are required. The prison authorities need to keep in touch with these changes and modify their training programme accordingly.

This may mean that greater emphasis will in future be placed on theory, and the prison authorities may find that they will be required to teach more theory. To meet this requirement the Prisons Service have already appointed 17 qualified technical teachers. There is also a close relationship between the prison authorities and the various industries in connection with the development regarding the modular training system and the implementation of such programmes for prisoners.

It is an objective of the South African Prisons Service to be more self-sufficient, taking into consideration the unfavourable economic situation which causes vast pressure on the State Treasury. The manufacturing of products/items such as bricks, paving bricks, kerbs, pre-cast walls, cement poles for security, wire fencing, concrete blocks for weirs and cement roads instead of tarred roads, are good examples of the way to fulfil the needs of self-sufficiency and must be exploited to the utmost extent. This will also save the taxpayer a substantial amount every year.

The desire to learn administrative/secretarial skills also needs to be taken into account in the case of female prisoners. Many jobs in the open labour market available to women are related to secretarial, typing, word processing, bookkeeping, clerical and general office skills. Offering this type of training would open many job opportunities to the women after their release. An investigation is taking place at this stage in this regard.

Specialized training is often incorrectly regarded as less useful than artisan training. Nevertheless, some useful work-skills were acquired and it is better for the prisoner to have the opportunity to learn at least some useful work-skills which have employment possibilities than not to receive any training at all. [Time expired.]

Mr Chairman, on behalf of the CP I should like to express my thanks to Gen Willemse, Brig Bruyn, Maj Venter, Lt Koekemoer, Lt Kraukamp, Capt Esterhuysen, Col Gordon and Maj De Villiers—all of whom have ties with the SA Prisons Service or that division of the Ministry involved with the Prisons Service—for their work and for the friendliness with which they serve not only us, but all members of the public, and for the exceptional service they render to South Africa.

Because these two departments still fall under one umbrella, I should also like to extend my very sincere thanks, for their friendliness, to others in the Department of Justice whom I have not yet thanked—Advocates Rudman, Nel, Bassett, Allers, Weideman, Labuschagne and De Lange and Mr Saayman who is a member of the Minister’s staff. Since I am in the mood to thank people, let me extend my sincere thanks to the hon the Minister for the way in which he has dealt with this debate. It was indeed a pleasure for us to participate. My sincere thanks for the service he furnishes.

I want to come back to one aspect that received considerable attention in the debate on Justice. I am referring to sentences, and I can therefore link up with this aspect in this debate.

We also find it regrettable that there are two instances in which judgments or sentences were criticised. I do not want to express an opinion about the judgments or sentences themselves; nor do I want to imply that everyone in South Africa is satisfied with the rest of the judgments or sentences. Is it not, however, only a small fraction of a percentage when there is criticism about two cases out of a total of 2 207 951 criminal cases in our courts? I think it is indeed a proud record, and in saying this I do not mean that there is no room for improvement, as I have indicated, but 2 207 949 cases elicited no criticism in this Committee.

I now want to devote some attention to the question of our prisons. We are all concerned about them, and in the past we have mentioned that it is estimated that our prisons are 135% full. Although we have nothing but the utmost praise for our prison officers, we regret the fact that we have a society in which there have to be so many prisoners. Perhaps the other departments should devote some attention to the prevention of crime, something which lies more in their field, for example responsibility for education, social welfare, etc. If we look at the tables furnished on page 118 of the report, we see that awaiting-trial prisoners constitute 55,11% of the total. I think we should address that problem and see whether we cannot reduce the number of awaiting-trial prisoners and whether we cannot bring them to court sooner, because then we would largely be able to reduce or eliminate another problem. The truth is, however, that our system, which aims at justice, perhaps results in more awaiting-trial prisoners landing up in prison.

In a recent judgment it was stated by a judge that when a prisoner was brought to court, he must be informed that he is entitled to legal representation and all that that entails, or legal aid, and then the prisoner is remanded until he can or cannot obtain such legal aid, depending upon the results of such an application. This does, of course, extend the period in custody and increases the number of awaiting-trial prisoners. I do not want to criticise that, but I think one could possibly prevent this by perhaps instructing the Police to hand a document to someone who is arrested, a document in which these rights are explained to him, so that he is aware of that when he appears in court for the first time and so that he need not be remanded for that reason.

Then there is also the problem of the psychopath which the hon member for Rosettenville referred in general terms, and more specifically too. My contention is, however—however distressing this may be—that we do not give special attention to individual cases. If one looks at the cases of successful rehabilitation, one sees that the recidivism figure is 33%. This is also the case amongst psychopaths, and they do not actually differ from other criminals. The Van der Merwe case was an extremely unfortunate one. There were a considerable number of enquiries. The question that was asked was whether the Prisons Service was wrong to have released him after 15 years. It is often easy, with hindsight, to say that they should never have done it. What would have happened, however, if he had been released after 20 years? He would then have served his sentence, without any reduction or parole. Would that have made any difference to the case, or would he have committed the same crimes after 20 years? Based on probabilities, there would possibly have been a repetition of what happened. I do not think the extra five years would have made any difference.

Fifteen years is a long term of punishment in anyone’s life. The fact that he was released after 15 years, after the Prisons Service had taken the necessary steps and instituted investigations, is not something that anyone can be blamed for, unless society wants us to give lifelong sentences to psychopaths or people identified as psychopaths—the identification itself is very difficult, and I do not even want to mention the question of the rehabilitation of psychopaths, because according to information I have gleaned, it is virtually impossible to determine this. Must we keep someone, who has landed up in prison at the age of 22, incarcerated until he is 70 years or 80 years old? It does not seem as if society wants that either.

This is a problem that needs attention, and I hope it will receive attention from other quarters in the future, for example from the psychological and medical professions. Those are the professions that must assist us here—in the rehabilitation and care, or lack of it, of those in or out of prison.

I want to congratulate the department on the new prison—but I can hardly call it a prison; rather call it a reform school—which has been constructed at Kinross, and also the one which is being constructed at Ogies. They are singular constructions, furnishing a singular service. Their construction is an exceptional achievement, and I am just afraid that one day we ourselves are going to apply for accommodation in such institutions. [Time expired.]

Mr Chairman, at the end of his speech the hon member for Bethal made a remark which compels me to say that I am sure that even though the prisons are 130% full, as he said, room would be made for him if he negotiated with the hon the Minister and the Commissioner.

In the course of my speech I shall touch upon certain aspects raised by the hon member for Bethal. It is always a pleasure for me to be able to participate in the discussion of the Prisons Service Vote. Apart from the fact that I have the head office of the Prisons Service in the Pretoria Central constituency, I probably have one of the largest and best known prisons there, ie the Central Prison.

The result is that recently I have had virtually daily contact with the officers and members of that Force. What strikes me, and also impresses me, is the effectiveness and absolute efficiency with which they carry out every task entrusted to them. If one were to look at page 115 of the annual report, one would see a photograph of seven officers who, this time last year, received decorations and medals for exceptional service. I am proud to be able to say that five of those members, including the Commissioner, are voters of mine. I want to tell them that it is a privilege for me to be able to represent such people here.

The mission of the South African Prisons Service is to promote order and security in the community by dealing with prisoners in accordance with statutory provisions. That is why the Prisons Service is one of the major governmental institutions in the central Public Service, judging by its staff complement of virtually 20 000 permanent members. Its functions are performed in 240 prisons throughout South Africa, and the budget of this governmental institution is approximately R750 million.

When one bears in mind that the task of the Prisons Service is carried out around the clock, the complexity of the task and the administrative demands made on them become apparent. What is more remarkable is the fact that this organisation is run by a commissioner and three lieuten-ants-general in posts at the deputy director-general level. That is why the achievements of the Prisons Service management, to which considerable reference was made in this debate, and also the recognition that the Commissioner and other members received, are a credit to this service.

I am sure hon members will permit me to convey a well-known adage to the Prisons Service and its management: “One cannot keep a good man down.” I therefore wish this management everything of the best on the road ahead and would like to support them in all their efforts at realising their ideals.

The Prisons Service is geared to giving back to society a better product than it received from society. The concept or myth—because it is a myth that imprisonment can rehabilitate an offender—of instant rehabilitation is totally unfounded.

There are many more aspects to which attention must be given in order to make someone receptive to change, than simply locking him up. In pursuance of that aim the Prisons Services’ task is to establish a therapeutic climate within prisons with a view to uplifting prisoners and ultimately making them better people. The treatment services in prisons are therefore aimed at discouraging negative conduct and creating socially acceptable conduct in the relevant individuals.

I want to dwell on one aspect of these treatment services which, in my opinion, is an absolute winner. I am referring to these youth institutions, or the youth project, started for Black juvenile prisoners at Leeuwkop Prison on 1 April 1986, and for Coloured juvenile prisoners at Pollsmoor on 1 August 1987.

Although I paid personal visits to both these prisons—I want to extend my sincere thanks to the hon the Minister and the staff for having made that possible, because it was illuminating and very interesting—I do not want to get bogged down in detail concerning these projects. I rather want to refer to the philosophy underlying the running of these projects.

Philosophically these projects are based on the accepted principle that juvenile prisoners require unique treatment. That is why the detention of juvenile prisoners is centralised. The purpose of the youth projects is to equip the juvenile prisoner with the necessary skills he will need in day-to-day living, particularly on his release. The important aspect of this project is that the prisoner must give his permission for inclusion in this project. That is why juveniles participate in this project with total commitment, the end result being very good indeed. Yesterday a success rate of as much as 77% at Pollsmoor was mentioned to me. In brief, the juvenile prisoner must give his permission to undergo schooling in prison.

In running this project, emphasis is also placed on continuity in selecting this small group of people. One does pay attention to the academic year, but this does not mean that someone who is not going to be in prison during that period will be excluded from anything. Other arrangements are, in fact, made for him, and he is made a better person. The point is that for the purpose of this project he has to be there for an academic year in order to maintain continuity.

What I found remarkable was that the syllabus for Coloured juveniles at Pollsmoor was the syllabus used by the Department of Education and Culture in the House of Representatives. The teachers involved are qualified teachers.

What gives cause for concern, however—perhaps the hon member for Robertson would be able to do something about this—are the many juvenile prisoners who have poor scholastic qualifications or are completely illiterate. Here specifically the project makes a fundamental contribution, because there is a practical reading and writing course for people to improve themselves in that field. One can only improve oneself if one can read and write, because if one can read, one unlocks the door to a wealth of information previously closed to one. I am therefore saying that in my opinion that is the principle underlying any rights anyone can ever have.

With these projects an attempt is also being made to give juveniles, at the very least, a Std 4 qualification, although provision is made for people to obtain a Std 10 certificate. This year there have also been people who have written the Std 10 examination.

It is also made possible for these people to give meaningful expression to their religious needs. When I was there yesterday, it was interesting for me to see that there were Bibles in the cells. For me this is a very important aspect. If a prisoner has something he believes in—whether in himself, or in God—really positive development is possible. I want to express my sincere thanks to the authorities of the Prisons Service for this task they are performing. In brief, prisoners in South Africa, in particular juvenile prisoners, are well cared for and receive top quality treatment. The Prisons Service does everything in its power to give society a better product, and therefore community leaders and members of Parliament have a specific task to perform in order to ensure that those people are properly accepted and integrated into society.

In conclusion I want to say the following. The successful re-integration of prisoners into the community is one of the ways in which society can be protected in the long term and in which the numbers of prisoners can be limited in the future.

My sincere thanks for the opportunity to furnish this contribution.

Mr Chairman, every prisoner has heard that he is going to jail because the magistrate has weighed up the crime, the personal circumstances of that prisoner and the interests of the community. It is on the interests of the community that I want to concentrate today, because I do not think that the magistrate has quite the same interests of the community in mind that I have.

As this Committee is well aware, the majority of our people are poor and some 50% of those poor are chronically poor. Our people are caught up in a vicious circle. Because of their poverty they do not go to school—hence the fact the hon member Mr Oosthuizen mentioned that some of them could not even read or write. If they do go to school they become early dropouts. Only in the past year we had 47 000 students who dropped out between Sub A and Std 5. As a result of the little knowledge that a person acquires at school he has few skills. He cannot be taken up in a work situation because of a lack of skills. He then becomes a dropout. He then joins a gang and on the Cape Flats alone we have more than 108 different gangs. In the area where I come from—East London—we were shocked when we counted up to 35 gangs. The gangs have their own subculture. I will deal with that later.

He then ends up in prison and when he is released from prison the vicious circle starts. This is where I want to compliment the Prisons Service especially on the new programmes that they have introduced.

What are we doing? We are only scratching the surface. By taking these youngsters and gathering them at Pollsmoor—we went there and we saw for ourselves—little murderers, absolute criminals serving eight years, are now being taught the three Rs. Some of them, as the hon member Mr Oosthuizen correctly said, will pass matric within the next year or two.

How are we going to contribute to our people escaping that poverty cult? That is the question. The Prisons Service cannot do it in isolation, I am sure, because they only have those youngsters there for a limited period. Once they have acquired a few basic skills they are taken outside and absorbed into this community where they return to crime. How are we going to break this vicious circle? How are we going to assist our community?

We have the Department of Education and Culture which concentrates basically on education only and has absolutely nothing to do with culture. We also have the other cycle that children who are sent to institutions are told when to eat, what to wear, when to get up, when to go to bed, and that is the only way of life they understand from the age of 10, 11, 12 until they are released. They are absolute misfits in our broader society again and the only place where they feel at home is back in the prison society where they are told when to eat, what to eat, when to get up, what to wear etc. How are we going to break this?

I think the Department of Justice must look at ways and means of using our Department of Education and Culture. And instead of sending these youngsters to institutions where they become institutionalised criminals, let us make more use of the various Boys Towns that have been established. We only have one out in Macassar. Why cannot the Department of Justice in conjunction with the House of Representatives create more of these satellite homes where instead of a little criminal at the age of 11, 12 being sent to prison, he can be taken and placed in foster care within this broader society where he can attend school within a community, where he can in foster care be removed from that vicious background which will ultimately take him to prison? In conjunction with the Department of Justice and the House of Representatives’ Department of Education and Culture, let us create more of these Boys Towns or family settlements to give that youngster the break he needs at a very early age to escape this vicious circle which will inevitably draw him.

As far the programme is concerned, the Army has started a similar programme out in Kimberley where those who have dropped out of school can then go and acquire certain basic skills.

Instead of giving people long sentences, why cannot we at the outset, when this youngster can still be rehabilitated, make use of these community service programmes? It is senseless sentencing a youngster to serve a community sentence when he has to go and sweep the streets or plant trees or lawns somewhere. We saw the experiment and I know it worked because I was involved with it in East London.

Recently we had two vicious gangs in Guguletu, but because somebody cared and donated a soccer ball it was possible to make peace between those gangs. The department, in conjunction with our administration, can work out a programme for these gangs of youngsters that roam the streets and get up to mischief. In the townships there is absolutely nothing to do, which is why they end up in gangs and get up to mischief. If programmes could be launched countrywide to break that negative influence which the gangs have on these youngsters, we can go a long way towards keeping more people out of prison. It is senseless trying to do something once they are behind the walls. Cannot the Prisons Service reach out to those youngsters before they come into prison? I think this is where various State departments will have to work together to find a meaningful programme to break this vicious circle. If this circle is not broken, more of our youngsters will end up in jail.

I would like to compliment the Prisons Service on those programmes which they have launched and I ask them if it is not possible to widen the scope of these programmes.

*Let all these people’s God-given talents be developed in prison. Instead of making a man cut stones in a cage, as we have seen, he should be taught to build with those stones so that he can be a better person and adjust to society once he is released. He should escape the circle of poverty. Our prisons should make it their aim to prepare themselves for training the prisoners who end up there, so that they can escape the circle of poverty and will not have to return later.

Mr Chairman, I would very much like to thank the eight hon members who participated for a very restful debate. One begins to grow nostalgic about the way things were when one started here as a back-bencher. Those were the days when the hon member for Houghton and I listened, with great satisfaction, to the debates in which people like the late Mr Vorster participated. Subsequently it was Oom Peet Pelser and Mr Jimmy Kruger. I know she enjoyed those debates, because each of them was a major challenge to her ability to cause controversy amongst Ministers and other NP members. She did so very efficiently, and I think she can look back on a very interesting career. I shall presently have more to say about her. The fact remains that in those days there was not such a restful atmosphere, the Prisons Service debates, to tell the truth, being some of the liveliest debates of that time. I really do want to tell the hon member for Houghton that it seems to me she has come a long way. It is not only the Prisons Service, but she herself, who has come a long way and gained many new, interesting insights.

[Inaudible.]

I think it is also due to our staff that this more restful atmosphere has crept into Prisons Service debates. I think the Prisons Service must go down in history as the body which, over the years, has absolutely kept pace with the needs of South Africa, in other words, acting and being administered in such a way that we do not have crisis management, because if one has crisis management, this is the result of some or other abuse. It is the result of some or other error—error of judgement—or something that happened which has given offence in some quarter, or has given the outside world an opportunity to have a hold over South Africa.

Over the years the Prisons Service has developed a management philosophy aimed at pre-empting crises rather than implementing crisis management. I do not want to draw comparisons with any other department, but I do want to speak about what I know, what I myself have experienced. The Prisons Service furnishes a 24-hour service which, apart from its protective and custodial task, as laid down in the Prisons Act, also continually looks to the interests of South Africa.

It must redound to the credit of our staff—the Commissioner and top management, but also every other member, down to the very lowest ranks—that they are not only sensitive to these interests of South Africa, but have also acquired expertise. This has been the case to such an extent that today one can walk into any prison and ask any non-commissioned officer about the way in which he deals with a crisis situation and about what would matter to him, and he would say: “Here, of course, my task is to look after the interests of the prisoners, but I also have to look after the interests of the warders. Here it is a question of properly looking after the prisoners so that they do not escape, and I have to protect the public, but I must perform my task in such a way as not to create an embarrassment for the Commissioner and for South Africa.” This spirit prevails throughout the Prisons Service. That is why, on a percentage basis, there are so few incidents in this Prisons Service, where staff encounter an average of between 113 000 and 115 000 problematic situations daily, each of which has the potential to develop into a minor crisis. That makes their achievement that much greater. That is why, relative to this crisis potential, there are so few incidents. That is why there is so little tension between warders and prisoners, a relatively small number of assaults and a relatively minor incidence of actionable infringements on the part of warders. I must tell hon members that it is an absolute pleasure for me to be the Minister of this outstanding Prisons Service.

I want to convey the Government’s appreciation to the Commissioner and also ask him to convey our appreciation to his general staff, commanding officers and every other member, for the expertise with which they constantly deal with the complex demands made upon an effective Prisons Service.

I thank him for the exceptional way in which he has taken cognisance of the financial realities of South Africa—which place such a stranglehold on his administrative capabilities—so much so that he is nevertheless able to make optimum use of what he has.

I want to ask him to convey our special appreciation to the functional and auxiliary staff, the warders, but also the psychologists, the welfare staff and the hospital staff. These people do an excellent job of carrying out planning and policy. They do so in spite of an increasingly more complex prison community set-up.

I do not want to let this opportunity pass without thanking the spouses, children and loved ones, who so loyally support staff members, for the sacrifices they make.

I also want to associate myself with those who sincerely thanked Brig Henk Bruyn who, since 1980, has been a staff officer in the Office of the Commissioner, for the service he has furnished. At the end of the year he will be leaving the service, subsequently to be employed in an administrative capacity in a functional sphere of activities. This is a field of activity we know he will tackle with great distinction. I thank the hon member for his loyalty and helpfulness to members of Parliament, because his conduct towards them has brought the service nothing but goodwill. I hope things go very well for him.

What hon member does not know Maj De Villiers? Div, as he is known in my office, also liaises with the Press. At times he is my righthand man. For the most part he has been my right hand, very seldom my left hand. He was very often the one who, with great ingenuity, kept the Ministry in navigable waters. I do not want to tell the Press that he knows more about what is going on in the Press than anyone else, but I have always said that Div’s “gut feeling” about what is being discussed in press circles was something I found baffling. He is also leaving at the end of the year and will be performing more senior duties elsewhere, in the same communications capacity. We want to wish Maj De Villiers and his family everything of the best.

†The hon member for Umzinto, like every good MP, is pressing for a new prison at Umzinto. There is an election in the offing and I do not blame him for pressing for a new prison. He deserves a new prison in his constituency. What I really appreciate of that hon member is that he pleaded for the preservation of the old building. This shows that the hon member is a culturally minded person, and I much appreciate that. In time to come there will be a new prison and tenders will probably be invited later this year. There will be a prison for approximately 350 prisoners. There will be eight houses and 25 flats for personnel, and, of course, two tennis courts and two bowling greens. I trust that the officials will invite the hon member to a game of bowls. The hon member will forgive me if I proceed to deal with other members in the time that has been accorded to me.

*The hon member for Bishop Lavis raised a whole series of very interesting matters. One very practical issue was what we did with the outlying posts. I do not see the hon member for Bishop Lavis here, but it is such an interesting point, and I think I must reply to it. The outlying posts which have been closed down are being utilised and converted for various other purposes within the context of our national set-up. For example, Koelenhof is becoming a provincial place of safety, Rawsonville a reform school and Simondium a school of industry. Some of the outlying posts have been converted into State prisons, for example Geluks Prison. We are still being consulted about the others from time to time, and we are, of course, interested in what will become of them.

Then I had a whole series of questions about staff from the hon member for Bishop Lavis. The hon member for Robertson, a very good friend of the Prisons Service, gave the hon member for Bishop Lavis a very effective reply in his speech, and it is therefore unnecessary for me to dwell on that any further. I thank the hon member for a very comprehensive study of matters relating to the Prisons Service.

I must say that the hon member for Robertson has first-hand knowledge of Prisons. That is not from practical experience—as I have said previously—as in the case of the hon member for Reservoir Hills. The hon member’s knowledge stems from personal interest; the hon member for Reservoir Hills speaks from experience. I shall be speaking to him in a moment.

On our side the hon member for Pietermaritzburg North also paid tribute to the staff, in particular to Brig Bruyn. I thank him for that. He also dealt very effectively with the whole question of the policy applicable to security prisoners. I prefer the term security prisoners to political prisoners, and I have noticed—I listened very carefully—that the hon member himself did so too.

He used the term “security prisoners”, an important aspect in our context, because we do not condemn people because of their political views. Nowhere is anyone sentenced or detained in terms of an order of a court which has found him guilty on the strength of his political views. All those who are depicted as having been sentenced or imprisoned for political offences are in prison because they have, in particular, committed common-law crimes, but at times also statutory crimes. Not one of them is serving a prison sentence, however, because of his political views. Here I am not referring to the so-called “detainees”, etc. I am speaking of security prisoners. So much for that aspect, and I thank the hon member for Pietermaritzburg North.

As is customary, the hon member for Houghton put a few interesting questions to us.

†I do not know whether the hon member is saying goodbye to us. I do not get that impression.

Does that make you cry?

Whether she is saying goodbye or not, I think that perhaps I should make this little annotation. Her love of justice was perhaps only excelled by her conviction that Ministers of Justice are bound to perpetrate follies and need to be guided by her.

That has been my experience.

I have been on the receiving end of so much advice from the hon member for Houghton that I have lost track of all the guidelines received from her. During the past two years she has been talking about justice—to my surprise—in terms that have not been over-critical. However, I cannot escape the impression that whenever she praises me, I feel as though I am shaking hands with a prize-fighter before the fight! Nevertheless, she has kept us on our toes, and she has done so in a manner which has set a very fine example to all of us. [Interjections.]

There is one observation which I think I share with her. There are too many people who think that the law should be enforced and there are not enough people who think it should be served. However, this cuts both ways. It goes for the revolutionaries, and it goes for the radicals on either side of the political spectrum. I really want to invoke the assistance of each and every hon member of Parliament that we should exert our influence with our constituents and urge them to observe the law and not to cry every time that it should be enforced if necessary by means of force. I think that if we could achieve such an understanding of and appreciation for the law, then the task of justice and of law and order will be facilitated.

*The hon member for Houghton referred to the question of overcrowding. Let me tell her that when we are discussing the question of overcrowding, we repeatedly say—in the House of Assembly or wherever—that this is a manageable situation in South Africa because the criteria in establishing a prison make it possible for us to deal with a reasonable degree of overcrowding and even serious overcrowding. We cannot simply go on erecting new buildings. I can tell hon members where new buildings are being erected.

Here in Worcester one is being constructed; there is also one at Umzinto, etc. That is not, however, where the solution lies. The hon member for Bethal referred very effectively to the question of prevention which also rests with other disciplines. Consequently it is definitely a challenge for me to bring home to people the idea that we would save so many more millions of rand by preventing rather than constructing prisons.

†The hon members for Houghton and Reservoir Hills both raised the issue of Ivan Toms. However, this issue is sub judice since Dr Toms has instituted a civil claim. By discussing this matter in detail one could perhaps prejudice either side of the case.

*The hon member also referred to the handling of awaiting-trial prisoners. I agree with her that we have too many awaiting-trial prisoners in South Africa. I agree with all hon members, including the hon member for Border, who also argued that we should deal with matters more quickly and expeditiously.

The fact remains, however, that criminality did not receive the attention it deserved during the state of emergency. Those who caused the state of emergency were intent on slowing down the legal system. Their intention was to keep the Police occupied. Their intention was, as was stated in one of the security documents, “to bog down the judicial system”, because they wanted to depict us as being inefficient.

The intention was therefore to increase the number of awaiting-trial prisoners so that dissatisfaction would result. Every practitioner who makes use of artificial devices to prolong court cases—there are a large number of practitioners in this Committee—do so to the detriment of their clients. Each of them who uses a technicality to prolong a case, even if his client is out on bail, is allowing someone who cannot get bail to spend a longer time in prison waiting for his case to be heard.

Night courts!

The hon member for Macassar has just mentioned night courts. That is a possibility. That is a plan that can be executed when we decriminalise or depenalise. Yesterday I held out the prospect of doing so in the case of minor crimes, as we want to do in regard to traffic offences. Ultimately this ought to have a salutary effect on awaiting-trial prisoners. I shall address hon members on this issue once more, however, when I ask for their support for very sweeping measures in the future.

The fact remains that I side with those who are uneasy about the large number of awaiting-trial prisoners, which we have definitely reduced—let me add—since the Police have, to a certain extent, begun to bring the emergency situation under control, but have not altogether made it unnecessary. I referred to that this morning. It is still a very serious situation. The climate is there. Unrest can flare up at any time. The Police are in a position to do their policing and to submit dossiers to the attorneys-general and the prosecutors so that more frequent prosecutions can take place.

In the Eastern Cape, where there was a backlog of almost 100 necklace murder cases, with drastic measures we have reduced this to 70. For specific reasons many of these people could not be released, although this is not the actual reason why they were not released. The fact is that all the various aspects are interlinked; each of these factors has an influence on the others.

The hon member for Smithfield referred to the Goedemoed situation. A regrettable incident took place there. That was only one incident over a number of years. There was nothing positive about it, however. There was kidnapping involved and attempted murder. Lives were also lost in an attempt to bring the situation under control. This case is also sub judice and will be tried from 8 to 26 May 1989. After the case has been heard I shall issue a full statement at a time when the report of chief magistrate Loots and Brig Griesel can no longer influence the case. Meanwhile it has been made possible for the Commissioner to deal more efficiently and expeditiously with the managerial and administrative aspects highlighted in that report.

We also had the benefit of eliminating minor abuses that could perhaps have arisen as a result of the institutional committees which, on the odd occasion, did not function altogether properly. That was the purpose of the investigation. After the court case, however, I shall react fully to this. Meanwhile let me thank the hon member for his very interesting contribution and for pointing out that the agricultural activities of the Prisons Service have entailed great savings for the taxpayer.

Let me hasten to add, however, that this is done in consultation with my colleague, the hon the Minister of Agriculture, so that we do not compete with the agricultural sector and therefore do not exceed the limits of our authorised activities. It is nevertheless very gratifying to hear that the hon member for Smithfield is impressed with the various activities. One of the very pleasant experiences one can have is a visit to such a farm to view the highly specialised agricultural activities.

†The hon member for Rosettenville addressed a very topical and very sensitive issue, namely anti-social personality disorder, which is also the alternative for psychopathy. However, perhaps I should point out that after the tragic death of the late Dr Verwoerd in 1966, the recommendations of the various commissions of inquiry that ensued culminated in the present Mental Health Act of 1973. Psychopathy was again included as a certifiable mental illness and defined in this Act. Provision was also made by the Act for the setting aside and the provision of hospital prisons as institutions by the Department of Justice for the detention of prisoners who have been certified as such. Two such hospitals have subsequently become operational at Zonderwater and Brandvlei.

The institution of such hospital prisons for psychopaths rests on the following assumptions: Firstly, that there is a successful programme available for the treatment of psychopaths; secondly, that psychopathy is in itself treatable and curable; thirdly, that coerced treatment is justifiable and effective, and finally, that future possible dangerousness can accurately be measured and predicted in order to again decertify and release such prisoner. These are the assumptions. Are they correct? Practical experience locally as well as abroad has indicated that these assumptions are often invalid and cannot be fully met. This has resulted in the fact that since the late 1970s most of the American institutions have closed down. Our own experience is recorded on page 96 of our annual report.

The hon member for Rosettenville argued very conclusively about the problems she came across in the course of her visit to Zonderwater. In response to what she said, my reaction is that after taking everything into account, one can reach the following conclusion. Firstly, the practice of keeping hospital prisons for psychopaths operational is no longer justifiable in the light of the costs involved in respect of manpower and the under-utilization of accommodation. She pointed out that it is 305% more expensive to maintain one unit, which may well cost R45 000 per unit.

Secondly, the limitation of an excellent programme to a small group with the poorest prognosis is no longer affordable. Thirdly, there is a definite need to protect the public against the acts of people like the Pikkie van der Westhui-zens and the “Screwdriver” Van der Merwes. Forgive me for interrupting myself—I was going to say to my hon colleague for Bethal that we all have our Van der Merwes! [Interjections.]

In other words, we have identified, after our experience with Van der Westhuizen and Van der Merwe and others, the need for authorities to have the power to keep persons incarcerated after expiry of their sentence; that is, after proper identification and certification, and only exposed to ordinary programmes and not to these very expensive programmes. I say we have identified this need. Whether this is the solution is another question. Whether Parliament, after proper deliberation, will be prepared to empower us to extend a person’s sentence beyond the sentence imposed upon him by the court of law, is another question.

There has been talk of operations, some of which are of a very delicate nature! [Interjections.] I think hon members will agree with me that in a civilised society this is perhaps the very last option.

Order! Is it necessary for the hon the Minister to enjoy it so much? [Interjections.]

I bow to your superior knowledge of this item, Sir! [Interjections.]

Therefore I intend to liaise with my colleague, the hon the Minister of National Health and Population Development, with a view to investigating the effectiveness of the Mental Health Act in this regard. That is what I am prepared to do in this regard.

*The hon member for Robertson deserves a reply to the question he put to me, namely how we can deal with overcrowded prisons. He and other hon members argued that we could only deal effectively with a certain number of prisoners owing to our staff position. If we do not have the funds to augment our staff—and also in the light of our experience in the Goedemoed case— surely we are looking for trouble if we have a warder look after say 10 or 20 people. We must therefore seek ways and means of keeping the prison population under control.

It is when we examine various concepts that we arrive at what is known elsewhere as “bursting”. It has nothing to do with eating too much, but means that when the occupancy level of a prison reaches a certain point, the commanding officer is empowered to grant remission of sentences to prisoners and release a sufficient number to bring the occupancy level back to normal.

Such a level can be in line with what we can accommodate, bearing in mind our ability to handle a certain degree of overcrowding. The intention is to recommend to the Government that in the present financial year the manageable prison population shall not exceed 113 500. If the Government were to accept my advice, it would necessarily also have to consider granting me the powers to implement the “bursting” principle by way of the Commissioner of Prisons, which means that the release of prisoners takes place in accordance with a decision of the commanding officer when the prison population reaches a specific level.

This has far-reaching implications, but not too far-reaching. The ones who would qualify would be those who are on their way to being released. This could mean a month or two either way. Normally when we release such prisoners, for example in the case of an amnesty, or when some or other event is being celebrated, the decision is always taken by the Government. The difference will be that it will then become an automatic administrative function. We would, of course, have to clear this with the Police, and it goes without saying that all factors would have to be taken into consideration. This could lead early parole and could mean about three months either way. On the one hand it is therefore a far-reaching measure, but on the other it is not all that far-reaching. I would very much like to give hon members the assurance that there will be a great deal of deliberation involved.

The hon member for North Rand made a very interesting and informative speech. He informed us about the history, progress and approaches involved in dealing with prisoners. He pointed to the system of classification applicable to prisoners. In reply let me tell him that as early as 5 June 1985, during the discussion of this Vote, I asked for hon members’ support for a system of classification for prisoners which would enable us, on the one hand, to accommodate prisoners for whom the prognosis was good in lower security and cheaper accommodation, but I also added that those for whom the prognosis was poor should still be detained in higher security establishments.

It is a great pleasure for me to announce that the principle of minimum-security detention, which is in accordance with similar developments elsewhere in the world, has not only been found to be a workable model, but the design of such facilities is receiving attention at present. I am saying that the design of such minimum-security detention facilities is receiving our attention at present. The aforementioned developments would enable the Prisons Service to detain those prisoners who qualify for minimum-security classification and who are imprisoned, in mediumsecurity conditions, behind very thick walls, necessitating the use of a great deal more steel and many more locks, in accommodation better suited to the purpose. These would be people in the pre-release phase, provided their security classification does not mitigate against this.

It would also include prisoners for whom the prognosis is good, for example, and who already work under minimum-security conditions during the day. Hon members have come across some of them during their visits to prisons. Hon members have encountered them acting as waiters and monitors and have also heard of them as potential day-parolees—people who leave prison during the day to do a job elsewhere and then return in the evening. This type of facility would also obviate the use of the conventional steel doors and bars, thick ceilings, concrete roofing and walls, etc. In such a facility there could greater flexibility in dealing with visits to prisoners in the open air, greater freedom to move around and possibly, at a later stage, a day-parole system.

Tentative calculations indicate that this could lead to a 40% saving in construction costs. Since the emphasis would shift from security to treatment, this would also mean a significant saving in manpower, which in virtually every organisation is the greatest single item of operating expenditure.

This would be a very interesting development. Having heard that our modern-day prisons are more like nursery schools than prisons, I wonder what they will be known as.

Sun City!

I can assure the hon member for Border that gambling does take place in prisons on occasion, but it is not allowed.

The hon member for Bethal mentioned that these days conditions were so favourable in prisons that we would probably all have a more restful time there than elsewhere in politics. I have no doubt that that will also be his opinion during the election. If he feels like relaxing with us, he is very welcome. I shall make the necessary arrangements.

I will meet you there.

The hon member for Chatsworth North dealt with considerable insight with the issue of training opportunities. An interesting point made by the hon member is that Prisons Service institutions are self-sufficient to such an extent that they succeed in keeping the running costs of prisons as low as possible.

At the outset I wish to state again that the Prisons Service does not compete with the private sector, but I am of the opinion that a cost-efficient prison system is worth examining. The commission and I, in consultation on this matter, will discuss it with my colleagues in the other departments. In time to come we will make an announcement which will perhaps assist us in bringing down our daily costs even more impressively.

*In conclusion, the hon member for Pretoria Central referred very effectively to our treatment of juveniles. I want to conclude by saying that a country that looks after its young people is a civilised country. On many occasions, when we have overseas visitors coming along to view these institutions, they are impressed, but that does not mean that we have a situation that is perfect. It only means that we are doing our duty every day in the interests of South Africa and that we are constantly striving for efficiency and for an effective way in which to carry out our mission in life.

The Red Cross?

The hon member for Houghton has asked me about the Red Cross. I was not trying to avoid this issue, but she has already had so much of my attention that I thought she would perhaps overlook that.

†The position is that the Red Cross has decided not to use the facility of annual visits completely on their own. It was a matter decided by themselves as a result of interaction with other issues and events. We are in consultation with them. They are most welcome to commence visiting again tomorrow.

I may perhaps say to the hon member—perhaps she has been informed privately on this issue— that the Red Cross really wants to extend the categories which they have been visiting to date. Personally I think we have given them very good reasons why such an extension cannot be considered. However, we have also given them alternatives and I am sure that with the diplomacy which we can command, we may still persuade them to use the alternatives when they do continue with their visits.

In the meanwhile a good spirit and good understanding prevail between the department and the Red Cross and I think it is a matter of time before they recommence their visits.

Mr Chairman, if there has ever been a necessity in South Africa for a separate Audit Act, this is the very time. There is a great need now for the actions of the executive authority to be monitored by an independent body in order to strive for and operate a clean administration. Cumbersome administrative procedures are modernised and streamlined by this Bill; in fact, this Bill introduces a new era for the Auditor-General and his Office. This takes place to such an extent that audit legislation is now separated from finance legislation.

Another very important situation, and I welcome it, arises in the following provisions concerning the appointment of the Auditor-General, and I quote directly from the Bill—clause 2(2):

1. (a) such period shall not be less than five or longer than ten years;
2. (b) the period of office of any person so appointed may not be extended;

and

1. (c) No person may be reappointed to the same post.

These provisions make it possible for the Auditor-General to be able to carry out his duties fearlessly and completely independently.

Seen in a nutshell, I think that one can summarise the Auditor-General’s instructions as follows, and I quote from the Bill—clause 5(7):

1. (a) all reasonable precautions have been taken to safeguard the proper collection of money to which an audit in terms of this Act relates, and that the laws and instructions relating thereto have been duly observed;
2. (b) all reasonable precautions have been taken in connection with the receipt, custody and issue of, and accounting for property, money, stamps, securities, equipment, stores, trust money, trust property and other assets; and
3. (c) all receipts, payments and other transactions are made in accordance with the applicable laws and instructions and are supported by adequate vouchers.

We shall be supporting this Bill.

Mr Chairman, I take pleasure in following on the hon member for Delmas. The Auditor-General Bill—as amended by the joint committee, provides another milestone in the race toward a better dispensation in South Africa, especially as regards accountability and the taxpayer.

This Bill has been introduced to attain an important object in South Africa at this stage. The situation giving rise to this Bill was the concern of the Joint Committee on Public Accounts regarding the activities of the Office of the Auditor-General. [Interjections.]

Order! Two hon members who are sitting four seats apart cannot possibly converse without doing so loudly. The hon member for Western Free State may proceed.

During consideration of the Treasury’s Reply to Resolution No 18 of 1985, the joint committee reported as follows in the First Report and the Second Report on Public Accounts:

1. (a) the Office of the Auditor-General in future be provided with adequate funds to effect, as soon as possible, the successful implementation of more comprehensive auditing, advice and improved accountability;
2. (b) the provisional proposals of the Auditor-General in respect of establishment increases, which were submitted to the Commission for Administration on 24 March 1986 pending rationalisation of the public audit function, be investigated urgently and receive the early attention of the Commission for Administration;
3. (c) it is essential that the organisation and establishment of the Office of the Auditor-General in future keep pace with constitutional and other developments;
4. (d) the question of the provision of funds and the staff establishments be considered in the light of the independence of the Office of the Auditor-General; and

I shall come back to this aspect later in the debate, and—

1. (e) the desirability of more effective accountability to Parliament of public corporations, undertakings and other institutions which are at present not subject to audit by the Auditor-General, be investigated.

Arising from these recommendations of the Joint Committee on Public Accounts, the already well-known Browne Report was drawn up. I want to thank these hon gentlemen for their comprehensive report. The chairman of this committee was Mr G W G Browne. Other members of the committee were Mr P S Botes, Mr D P de Villiers, Mr J J H Kotzé and Prof J A J Loots. These gentlemen’s report contributed largely to the Bill which has now been tabled.

The Joint Committee on Finance scrutinised the Bill thoroughly and consequently amended clauses 1, 2, 3, 5, 6 and 9. The committee also inserted or altered five new clauses. The advantages attached to the implementation of separate audit legislation are the following, and I should like to mention three points later.

This Bill should serve as a clear indication that the Government is serious in operating a clean and thorough administration. Although this might definitely not appear to be the case from the public point of view at this time, in the short time at my disposal I want to pause here. The Government is serious about eradicating corruption and similar abuses.

In spite of all the polemics between the DP and the Nationalists, I want to warn hon members seriously about this matter today. Over the past six weeks during which I have been visiting homes, it would appear that my people think all members of Parliament are involved in corruption. Last Saturday I heard such an allegation. I was paying a house call on a teacher and he said: “Sir, I still have to decide whether I am going to vote. I must vote but members of Parliament do not even pay their taxes.” Of course this is wrong. I do not want to admonish hon members but I want to tell this Committee that we should be careful that we do not open a can of worms with these charges of corruption and various others against Ministers—guilty or innocent. This would affect all hon members adversely and certainly not all hon members of this Parliament are guilty of corruption.

I now want to revert to the Bill. This Bill is important because it emphasises the value which Parliament attaches to the audit function. It is important that we safeguard public interests.

In the short time at my disposal, I should like to illustrate a few important points from the Bill. I quote clause 2 of the Bill:

1. 2(1) The State President shall after consultation with the Speaker of Parliament appoint an Auditor-General, regard being had to inter alia, the knowledge of or experience in auditing, State finances and public administration of such person.
2. 2(2) The Auditor-General shall hold office for such period as the State President may determine at the time of his appointment: Provided that—
   1. (a) Such period shall not be less than five or longer than ten years;
   2. (b) the period of office of any person so appointed may not be extended; and
   3. (c) no person may be reappointed to the same post.

[Interjections.] The hon member asks why not. As the Auditor-General has such wide powers, he should not stagnate at one level and become friendly with the people with whom he works. We saw what happened in the Vermaas case when hon Ministers became friendly with people with whom they no longer want to be friends. [Interjections.]

It is important that the Auditor-General’s position be of such a nature that no finger can be pointed at him.

A good man!

I agree with that. He should be a good man. I can tell hon members that the present Auditor-General is cool and calculating in handling his work. Occasionally the hon member for Yeoville reprimands the Auditor-General’s officials. The Auditor-General then blushes slightly but he remains cool and calculating and does his work thoroughly.

I should like to appeal today that it be looked into whether the Office of the Auditor-General, once it is established, could not become entirely autonomous by having its own budget. It would not fall under the Ministry of Finance but report directly to the State President or form part of Parliament. Hon members will appreciate why the Office of the Auditor-General should be completely autonomous. It is important that this Office should not fall under any political Ministry. Hon members will agree that corruption and attempts at corruption have to be combated daily. I do not intend to imply by this that the Office of the Auditor-General will be infested with this but I want to emphasise that this Office should be completely impartial.

Clause 11 includes the appointment and promotion of the Auditor-General’s staff. A very important aspect here is found in the arrangements for the establishment of an Institute for Government Auditors. The department is currently involved in developing a course in Government auditing. This clause will ease the workload enormously in that the Auditor-General will be able to take many decisions himself. This will also greatly stabilise the problem of the shortage of staff. [Time expired.]

Mr Chairman, I should like to associate myself with the previous speaker and also sound a warning that we as MPs of this Parliament should be careful that we do not create a scenario of corruption which we shall eventually no longer be able to handle. We should be careful that we are not all tarred with the same brush and MPs and politics get a bad name.

†As they said to me years ago, politics is a dirty word in Europe.

At the outset I would like to begin by making a few observations relating to the background against which this Bill should be viewed. Firstly, I think there has been a long-felt need in South Africa for a separate audit Act, on the one hand to confirm the independence of the external audit function of the accounts of departments of State and statutory bodies, and on the other hand to conform to modern, internationally accepted practices.

I think the most important factor which should be borne in mind when considering the content of this Bill is that the Auditor-General and his Office act for and on behalf of Parliament. I want to emphasise the fact that the Auditor-General acts on behalf of Parliament. The position of the Auditor-General and his Office is therefore unique when compared to other State institutions.

*The Auditor-General firstly acts as the watchdog of Parliament and reports to the taxpayer. This is a fact which should be borne in mind. He acts on behalf of Parliament and reports to the taxpayer concerning the regular and effective utilisation of resources which Parliament makes available for the realisation of objectives and the satisfaction of needs to the benefit of the country and its people.

During 1986, as already indicated, the Standing Committee on Public Accounts recommended that the Auditor-General and his Office become independent in their actions. Subsequently—we have to pay tribute to him for this—the Auditor-General ordered an incisive inquiry by a team of experts which was known as the Loots Committee. I want to pay tribute today and express my thanks and appreciation, firstly to the present Auditor-General, Dr De Loor, and his department for the work they did in this connection and also in connection with the current legislation, and to the Loots Committee for its contribution.

The committee was more specifically of the opinion that—

1. (i) auditing is a function which is carried out on behalf of Parliament as part of parliamentary control and therefore should be seen as exogenous to the executive authority and should be independent of it;
2. (ii) greater independence and impartiality of the Auditor-General would contribute to more effective Government auditing;
3. (iii) the professionalising of the Office should receive preference; and
4. (iv) measures to promote the objectives in (i), (ii) and (iii) above be instituted as soon as possible and, wherever possible, preferably be embodied in legislation.

Consequently we have this legislation before us today and I should like to refer to one or two clauses.

Clause 2 provides specifically for the appointment of the Auditor-General and this appointment, as already mentioned by the previous speaker, will be made by the hon the State President in consultation with the Speaker of Parliament. I accept that the Speaker will make this recommendation after consultation with the Chairman of the Joint Committee on Public Accounts. The non-recurring appointment makes provision for fearless action by the Auditor-General but good client relationships can nevertheless be maintained.

Secondly, I should like to refer to clause 4, which relates to the discharge and vacation of office of the Auditor-General. In order to establish the independence of the Auditor-General further, the suspension and discharge procedure which is followed in the case of judges is made applicable to the Auditor-General too. This is very important in my opinion and could make a very great contribution.

Parliament, through the Joint Committee on Public Accounts, recommended that in accordance with clause 5 the executive authority should not exercise control over the work of the Auditor-General and his Office and the latter should therefore carry out no executive duties on behalf of the executive authority. This is why it is provided in clause 5(4) that the Auditor-General shall carry out no duty or function other than by means of an Act of Parliament, except when the State President deems it to be in the public interest and gives such instruction.

Clause 5 further confirms the duties and powers of the Auditor-General. Clause 5(8)(b)(iii) confirms that the Auditor-General will no longer carry out the usual well-known old “tick and turn” but that his approach will be one of performance auditing and value for money so that he will have the right to investigate whether any property, money, stores or equipment are used in an economical, efficient and effective way. I consider this very important.

An important principle which was recommended by the Joint Committee on Public Accounts and included in the legislation as clause 5(9) is the principle that the Auditor-General is to have access to all accounts of a confidential nature. In order to protect the sensitivity and confidential nature of those accounts, the Auditor-General’s report will be limited to the extent determined by the Minister of Finance in consultation with the Auditor-General and the State President.

A very important point which comes to the fore in this legislation is the question of curbing irregularities. In spite of the fact that the position of Advocate-General was created in 1979, the Auditor-General will perhaps be able to play a very much greater role in this regard. The difference between the two is that the Advocate-General acts reactively after receipt of a complaint. His value as an active observer in this respect is limited because he does not have a continuous physical presence in Government institutions. He also acts only after irregularities have occurred.

Although the Auditor-General follows an ex post facto approach, in terms of the new legislation he will be able to act proactively in the sense that through his investigation, institutions, control measures and his mere physical presence he can contribute to the combating and curbing of irregularities, fraud or error. It is clear that the Auditor-General’s role regarding the curbing of irregularities will be decisive and that the more effective use of this is the best way of dealing with actual and potential irregularities tim-eously.

The last point which I should like to raise here is the question of the Auditor-General’s staff. A previous speaker made supplementary proposals to the Bill and alleged that the Auditor-General, as had already been put to him, could get away with more than murder. I do not agree with this but to my mind the fact that it is possible now for him to appoint his staff from outside the office of the Commission for Administration contributes greatly to his effective operation.

I want to express my thanks and appreciation to the Auditor-General and his staff and should like the support for the Bill from this side of the Committee to be placed on record.

Mr Chairman, as was expected, the chairman of the committee has very amply and comprehensively explained the whole Bill and I do not want to repeat what he has just said since he has covered all the important facets.

The Bill makes provision for a new Act to be added to the Statute Book. It has been long felt that the Auditor-General, who is the ultimate guardian and protector of public funds, should operate independently from any other department and, in this case, from the Department of Finance.

This is a historic step when one considers that since 1911, the Auditor-General has operated under the Department of Finance. I must, however, hasten to say that there was nothing wrong in that or that anything irregular took place; on the contrary, this major change became necessary owing to the changing demands upon the Auditor-General and his department. This mostly came about through changes in the new Constitution in terms of which provincial and local authority accounts now fall under the department of the Auditor-General.

The Auditor-General’s department handles all these accounts which puts tremendous pressure on his department. This is in keeping with what one calls the broadening of democracy. I believe, however, that this is the broadening of independence. It is also in keeping with trends in developed countries where the Auditor-General and his functions are enacted in a separate Act.

We therefore support the Bill.

Mr Chairman, this particular measure is in fact historic because it is the first time that the Auditor-General has been put under a separate statute. It is also significant as some of the provisions are quite different to those which existed before and to which some of my colleagues, who have already spoken, have referred, in particular the hon member who is the chairman of this committee.

I have served on the Public Accounts Committee for 15 years—ever since I have been in Parliament—and also on the Public Accounts Committee of the Transvaal Province for an equal period. There is no question that the role of that committee, combined with the Auditor-General, is one of the most important that exists in Parliament if control over the Executive is to be kept. There is no doubt that the legislator has to keep control over the Executive and to ensure that accountability takes place.

It is in fact a tribute to the Executive that they are prepared to have that kind of control imposed upon them. That to my mind is one of the Western democratic concepts which apply in this country and of which we are proud.

Accountability and control, in respect of state expenditure, is an absolutely vital matter. Without it the Executive can cover up whatever it does, can make sure that the public does not know what is happening to their tax money and, at the very least, when we criticise how the money is being used, we can at least know how it is being used as a result of the efforts of the Auditor-General.

I would like, if I may, to pay a tribute not only to the committee under the chairmanship of the hon member for Vasco which is largely responsible for the initiative in this, but also to the Auditor-General in his present office for having taken the steps to ensure that this particular Bill goes onto the Statute Book.

Much has been said in regard to what Auditors-General can do and what they cannot do. Let me illustrate this by giving a very simple example. Would we ever have known that, for instance, there were 575 video machines purchased which were left lying around and which nobody used for years? When they were eventually used, they were merely used so that it could be proved that they had been used in case an explanation should be asked for in this regard. That is one example and I can quote hundreds and hundreds of them.

Interestingly enough, the department from which this comes—and this shows the way with which it is dealt—is a department in which so many other things are also wrong.

One will find that when the Auditor-General is doing his job properly, a whole can of worms will eventually come out. This would never happen were it not for the function of the Auditor-General. There has been some talk of corruption. There is no doubt that one of the functions of the Auditor-General is that he has to see to it that where there are irregularities—whether they are corrupt or of a purely technical nature—they must be exposed. That is his job, whether they are caused by negligence, a disobedience of the rules or a corrupt practice.

We went through a phase recently when corruption was a major issue. Corruption remains a major issue. We now have a situation where people correctly say that we must not become hysterical about corruption, that not everybody is corrupt, that not every politician is corrupt and that not every public servant is corrupt. The issue, however, is that one corrupt politician or one corrupt public servant is one too many.

We should not compare ourselves with other countries and other standards. We have certain value standards in this country which have to be adhered to. It is those standards which are at issue. There are many countries with which we can compare ourselves, where corruption is the order of the day, but those are not the countries where our value standards are applied. There is no question, insofar as corruption is concerned, not only that it is the duty of the Auditor-General to expose it—and he does this in a very effective manner—but also that corruption in our public life is an unacceptable phenomenon whether it be on a small or a large scale, and it has to be rooted out.

When we give greater power to the actions of the Auditor-General we are strengthening his hand against corruption. The State is to blame if it gives insufficient power and inadequate authority to the Auditor-General in order to carry out his functions.

One of the issues dealt with in this particular Bill is that of staff. If the State does not provide sufficient manpower to enable the Auditor-General to carry out his functions, then the State is failing in its duty to see to it that there is adequate control and that inefficiencies and corrupt methods are exposed.

Let me give the Committee an example. In the year 1987, 487 out of 1 818 offices were inspected—in other words, less than a quarter of the offices were inspected. When we read the report we see that there is insufficient staff available to the Auditor-General to carry out his tasks. If one does not give the Auditor-General the staff to do the job, one then has a high degree of culpability resting upon one’s shoulders. One cannot escape from that degree of culpability.

The truth is that the more staff one gives, the more taxpayers’ money is saved. I refer again to a report where it is stated that as a result of 1 500 queries something like R6 million was recovered. That is when one is doing fewer inspections than one should be doing, and when they are done only in a limited way because of a lack of staff.

Let us take another example. We know in regard to the activities of the Commissioner for Customs and Excise and the Commissioner for Inland Revenue that they are understaffed in respect of inspectors. The consequence is that for every additional inspector that one employed, one would produce a million rand for the fiscus. I say to the hon the Deputy Minister: How can he afford not to make the investment of employing a person who produces a million rand for the State? In normal circumstances this million rand would be from people who are defrauding the State of the money in one way or another.

Obviously there is a limit to the number of staff, but inadequate staff for this kind of activity is something for which responsibility has to be taken, and that responsibility rests squarely on those who do not provide the necessary staff.

Now we have a situation where, in terms of this Bill, the question of the provision of staff now falls squarely on the hon the Minister of Finance. It now falls under his department and is out of the control of the Commission for Administration. This is a very important precedent which has been set and one which we should not ignore because this precedent will be followed by other factors.

It has been said—the hon member for Vasco who is the chairman of this committee has pointed this out—that the Auditor-General has been the watchdog of Parliament. If I may I would like to draw attention to some of the other things the Auditor-General has to do. He has to see to it that the Government does not spend more money than is voted for a particular job. He has to see to it that the money is spent on the things for which it has been voted. The hon member for Vasco will forgive me, but he knows that many examples have arisen where money has not been spent correctly, where we have fought it out and where some harsh lessons have been learned.

One of the significant things for which I think the Joint Committee on Public Accounts, together with the Auditor-General deserves credit is that party politics have never played a part in this. There have never been cover-ups of this situation. When I pay tribute to the present incumbent of that office, let me also pay tribute to Mr Barry who held office at the time of the information scandal and who with tremendous courage, went ahead in many cases against the wishes and hopes of members of the Executive. He played a major role in exposing that situation. The Auditor-General exposes inefficiency and shows up irregularities. In doing so the people who have held this office have demonstrated their skills, patience, dedication and above all, as I have indicated, their courage.

There are important factors in this Bill. The independence of the Auditor-General and the fact that it is a one-time appointment which is not renewed is tremendously important, because it gives him an independence which enables him to fulfil the function in the tradition in which it has been built up here. The Auditor-General cannot be removed except in the same manner as a judge who is removed by resolution of Parliament. These factors add to the independence and the strength which the Auditor-General in fact has. This a measure which is regarded by many as technical. It will not be regarded by the public as being the most significant thing that we have done, but in reality this measure is perhaps one of the most important that will go through Parliament, not only in this session but for many a year. I have no hesitation in supporting this measure and in saying that it will help to introduce good, clean and effective government in South Africa. It will continue a tradition which exists in the Office of the Auditor-General in South Africa, which so many people have filled with distinction and which the present incumbent does in exactly the same way. This measure is for the benefit of the taxpayers of this country. We support this Bill.

Mr Chairman, after the hon member for Vasco and the hon member for Yeoville have spoken so expertly on this Bill, not much remains to be said about it.

In the first place, I want to examine the Bill from the taxpayer’s angle. The taxpayer, who surrenders his hard-earned money to the State in the form of tax, is entitled to have this money used in the most productive and effective way. The one single body or person who is able to safeguard the taxpayer’s interests in the spending of his tax is the Auditor-General and his staff. This is why the proposed legislation is so important to the taxpayer. For the first time the Auditor-General is being instructed by means of legislation not only to watch over the correct expenditure of that money but also to do it in the most economical way and to see that the best value for money is obtained, as contained in clause 5 of the proposed legislation.

I want to contend that this proposed legislation and that clause must be the most important event from the taxpayer’s point of view which has taken place in years—I am associating myself with the hon member for Yeoville in this regard.

It is common knowledge that Government expenditure is too high and the taxation burden too great. The two equal each other. In this specific connection the Auditor-General has a very important part to play, especially in the execution of clause 5, subsection (8)(b)(iv) which gives him the right to investigate and inquire into any matter, including the efficiency of internal control measures related to expenditure. To control expenditure and to eliminate what is ineffective is a very important function entrusted to the Auditor-General.

As a former official of the Office of the Auditor-General, I find it a great privilege to be able to participate in this debate today. I should like to exchange a few words with hon members about the staff in the service of this department.

Up to this point, one of the greatest problems was that the Auditor-General and his officials, including him, were public servants under the control of the Public Service and linked to the Public Service Commission. Auditors are professional people and I venture to say that the Auditor-General’s work so far—this is expressing it bluntly—was merely that of an internal auditor. This is the first step in separating the Office of the Auditor-General from the Public Service Commission and this will only be to the advantage of the Office of the Auditor-General and the country too.

There has been reference to professionalising this department. The first steps in this regard have already been taken in that the Institute of Chartered Accountants has for the first time granted permission that officials’ periods of study for attaining the CA qualification may also be spent in that department. It would be of great benefit to the Office of the Auditor-General and the taxpayer if chartered accountants became professional experts as officials of the Office of the Auditor-General regarding the expenditure of Government finance, whether by the State, provincial administrations, local governing bodies or statutory organisations which work with State funds.

The first officials who are spending their period of study in the Office of the Auditor-General are already in service. Staffing the department with professional people is the first step in making this department a professional one. This Bill is not only of great benefit to the State but also to the Office of the Auditor-General. It is of particular benefit to the taxpayer who is, after all, the most important person and the one whom we all serve.

Mr Chairman, in the course of my speech I shall link up with the question of taxpayers’ money, to which the hon member for Hercules referred. I want to agree with the hon member for Yeoville, who said that this Bill was truly historic. It was the consequence of a report of the Joint Committee on Public Accounts. We obviously want to pay great tribute here to the Office of the Auditor-General and his staff but also in particular to the Loots Committee which did the great initial work.

I also want to pay tribute in particular to my colleagues on that committee. They all worked very hard. A special word to the chairman, the hon member for Vasco, and the Deputy Chairman, the hon member for Yeoville. I should like to direct a personal word to them. Over the past five years, as a result of my acquaintance with these two dignified gentlemen, I have definitely been enriched and become more mature. If I were not to return here, I would always remember them.

Next to the consideration of Votes, the Bill which is being discussed in this House this morning is one of the most important Bills which will come up in Parliament this year. It is important for the State’s financial systems to be sound and that the country’s scarce resources be used to the best advantage of communities. Money which is spent by a Government institution does not belong to that institution but is public money. John Citizen, the taxpayer, is not interested in legislation or authorisation which precedes any expenditure of funds. What he wants to know is whether the funds are used to the benefit of the country and as economically as possible.

A parliament which is composed of members elected by the people and to whom absolute control of the Treasury is entrusted is one of the most important principles of a democratic system of government. A parliament which is elected by the voters has the right to impose taxes to collect money for the Treasury in various ways and also has the power to vote and decide how those funds may be spent. Parliament has no assurance that funds which it has made available for expenditure to the executive authority are spent in accordance with its wishes. This problem is now being addressed by the Auditor-General. The hon member for Yeoville went into this in detail.

Every true democratic system of government has to provide for an absolutely independent Auditor-General. Every effort to curb the independence of action of the Auditor-General comes down to an erosion of the democratic system as we know it. There should be no appearance or trace of dependence on the executive authority in such a way that it can have an adverse effect on the impartiality and fearlessness of the Auditor-General.

The main object of this Bill is to reinforce control of Government finance. It is as plain as a pikestaff that the Auditor-General has to play a greater and more important part in extending the principles of sound financial administration to all the institutions which are audited by him. From the nature of the watchdog function which he has to fulfil, I consider it essential that the image of the independence of his Office be promoted as far as possible. This is the purpose of the Bill before this House today.

The Bill also has more significance now to the man in the street. Various members of the public have frequently asked me what officials safeguard the matter of value for money. For this purpose the concept of value for money, or performance auditing, has now specifically been included in the Bill and the Auditor-General has the right to investigate whether State funds or State property is used in an economical, efficient and effective way. He therefore not only has to ensure that funds are spent legally but he is also specifically entrusted now to supervise how effectively the taxpayer’s hard-earned money is spent. As the role of the Auditor-General is extended to include performance auditing too, the requirement for independence becomes increasingly important.

A very important principle which is included in the new Bill is that the Auditor-General will in future have access to all accounts of a confidential nature. Previously the hands of an Auditor-General were tied in certain cases in the execution of his duty. There can therefore be no question of secret accounts which have to remain a closed book to him. This is conducive to the idea of a clean administration to which all of us in South Africa aspire.

Since I have served on the Joint Committee on Public Accounts, I have frequently become aware of the important part played by Government auditing in South Africa. Our country has limited resources and, in the face of the onslaught on this country, we must ensure that resources are utilised optimally.

Various hon members have already referred to recent corrupt activities and I do not wish to enlarge on this but the present apparent increase in irregular activities and ineffectiveness in the Government sector can be attributed partly to declining effectiveness in the purpose of auditing, although modern auditing techniques strive to reveal undesirable actions earlier than would otherwise have been the case. Consequently by permitting Government auditing functions to come into their own, not only can shortcomings and irregularities be identified in good time but also minimised and even prevented.

The role and potential of Government auditing is not always fully appreciated. This potential can only come into its own if resources, especially high-level manpower, are obtained. It is a fact that independence and effective external auditing are inextricably bound. Effective external auditing is simply not possible without independence. It must be borne in mind that, because external auditing is not an executive or administrative function, outsiders will not always notice if an auditing effort does not succeed. It can therefore easily happen that the auditing function is left in abeyance by developments or even neglected. In my judgement the greater flexibility regarding the provision of staff, for which the Bill provides, should definitely contribute to tackling these problems properly and consequently enabling the Auditor-General to act more independently.

We take pleasure in supporting this extremely important Bill.

Mr Chairman, I am a late speaker in what has been quite a long line-up of speakers to welcome this Bill. I believe that all the important and relevant points have been well made. Much has been said about accountability and the vitally important independent audit function.

However, I believe that this Bill goes far further than this. Auditing is a developing science requiring the skills of a well trained, well motivated and committed professional.

In paying tribute to the staff, we must recognise that auditing is no longer the preserve of little grey men with green peaked caps and quill pens checking endless columns of figures.

The scale of operations and their complexity— largely attributable to the development of the computer industry—require sophisticated techniques of a standard equivalent to any other profession. In addition, the auditor’s responsibilities extend far beyond merely reporting on the correctness and the fairness of figures. In this regard I would like to refer hon members to clause 7 of the Bill before us:

That responsibility extends far beyond the checking of the accuracy of figures. It actually deals with the issue of auditing management and its effectiveness. I believe this adds an enormous dimension to the responsibilities of the Auditor-General.

In order to perform this function it is imperative that this office be staffed by the best available people from the auditing profession and in order to attract those professionals two very important requirements have to be met.

One, which the hon member for Yeoville dealt with at some length, is the conditions of service. We have to compete with the private sector in which there is already a shortage of suitably qualified professional people. We have to be competitive and attract them to this function.

Secondly State auditors must not, I believe, operate in a vacuum. They must be continually exposed to their fellow professionals in the private sector. I believe that this Bill enables the first requirement, relating to conditions of service to be met. I am also confident that as a result of the excellent relationship between the Auditor-General’s Office and the profession of chartered accountants, the right climate does prevail to attract and hold high calibre professionals.

Mr Chairman, the hon member for Pinelands did not mention that this entire Bill has been covered by previous speakers and I would like to endorse what they said. However, I feel that times have changed and over the years the workload of the Auditor-General has no doubt increased.

Monitoring the funds of all the departments is one of the very important jobs—if not the most important job—which the Auditor-General has to do. In my mind this task can be likened to that of an artisan who needs the best tools to carry out the job. By enacting this new piece of audit legislation, I believe that an extra arm is given to the Auditor-General to control all these departments. Although one may feel that this is extra money spent whilst everybody is crying out for the curbing of Government expenditure, I think it is money well spent.

As the hon member for Yeoville mentioned, if one has the right people in the right department, corruption and irregularities will be overcome. We have no doubt that this piece of legislation is beneficial to the Auditor-General’s department and we support the Bill.

Mr Chairman, I should like to associate myself with the words of appreciation and tribute which have been expressed to the Auditor-General as well as the Chairman of the Joint Committee on Public Accounts, the hon member for Vasco.

On Tuesday evening in East London the hon leader-in-chief of the NP again strongly emphasised clean administration and the fight against corruption. He said:

The Auditor-General Bill is a clear indication that the Government is serious about this. Permitting the Office of the Auditor-General to act as an independent body to a great extent underlines the commitment of the Government and the hon NP leader-in-chief to the operation of a clean administration.

There is a second important aspect, however, which is addressed in this Bill. I think it was the prophet Jeremiah who said:

This Bill does not deal entirely with the past, however, but with the present and the future because it provides for performance or so-called value-for-money auditing. As in the case of the potter, the object remains not to repeat the mistakes of the past but to limit them to a minimum and even to improve upon the performance.

The provision of trained staff will be one of the challenges with which the Office of the Auditor-General will be faced. Although privatisation is used to the greatest possible extent in the form of private auditing firms, trained staff remains a serious problem. Last year the National Manpower Commission conducted a survey involving almost 1 million workers. In the list of problem professions which were identified, in which vacancies continually occur and for which immigrants have to be admitted, accountants feature among others. This problem demands urgent attention. The importance of adequate personnel has already been emphasised by the hon member for Yeoville.

One of the cornerstones of a democracy is public representation in the expenditure of public funds. Government auditing forms the basis for the maintenance of this important cornerstone and that is why we find confirmation of this in the Constitution of the Republic of South Africa.

There has been a long-felt need in South Africa for separate auditing legislation—firstly, to confirm the independence of the external auditing function of the State department and statutory bodies and, secondly, to come into line with modern internationally accepted practices. This Bill marks a new era in the history of the Auditor-General and his Office. For the first time since 1911, auditing legislation is separated from other finance legislation and the independence of the State’s external auditing function is reaffirmed. The object of the Bill is also the elimination of antiquated and outdated provisions while many necessary but at present cumbersome administrative procedures are streamlined more. Laws which are affected by this are inter alia the Post Office Act, 1958; the Exchequer and Audit Act, 1975, and the Public Service Act, 1984.

When the Auditor-General is expected to report on accounts, in terms of clause 7(b) he shall draw attention to—

Clause 7(b) confirms performance or so-called value-for-money auditing. Although performance auditing is not a new concept, until fairly recently it was reasonably unknown in South Africa. According to Colin Potts of Deloitte, Haskins and Sells, performance auditing basically comprises three components: Firstly, to use the right resources at the lowest cost; secondly, to do the right things well, and, lastly, to obtain the desired results. The progress which has already been made in the assessment of performance within the Public Service over the past two years may largely be ascribed to the support of the Cabinet, the Joint Committee on Public Accounts and senior officials. The taxpayer, however, is interested in only one aspect and that is whether this means money in his pocket. In Britain the target was set of saving at least ten pounds for every pound spent on performance auditing. In practice the saving has amounted to eight pounds for every pound so far. I hope that we shall set the Auditor-General similar performance targets in the Republic of South Africa. Nevertheless it is more important to publicise the successes which are achieved by performance auditing very thoroughly.

In considering this Bill, the criticism and important role played especially by the Joint Committee on Public Accounts should be noted in reinforcing the independent functioning of the Auditor-General and his Office.

The investigating team recommended that, in the interests of improved public accountability, the principle be established that sittings of the Standing Committee on Public Accounts should extend over the entire year. Against this, the Joint Committee on Public Accounts recommended that the promotion of improved in-depth public accountability be supported by more regular sittings but it should be investigated to establish whether, if so, it were practicable.

In the light of the greater responsibility granted the Auditor-General and his Office by this Bill, this inquiry into the activities of the Joint Committee on Public Accounts has also become a priority.

I shall conclude by saying that I have no doubt that this Bill will make a positive contribution in giving the taxpayer value for money. I consider it a privilege to support this Bill.

Mr Chairman, I wish to thank the hon members for their support of this Bill. I also wish to thank the Joint Committee on Finance and the Joint Committee on Public Accounts for their good work in this regard. Also of importance is that I want to pay tribute, as other hon members did, to our Auditor-General. I think he did an excellent job and I think this Bill is one of his initiatives to improve the office of the Auditor-General.

As pointed out by the hon member for Delmas, this Bill heralds a new era in the history of the Auditor-General and his Office. For the first time since 1911 audit legislation and the independence of the State external audit function will be reconfirmed.

The role played by the Auditor-General in pursuance of the Government’s policy of clean administration cannot be overemphasised. In his position as the final objective watchdog of Parliament, as mentioned by the hon member for Delmas, the Auditor-General is in an excellent position to identify maladministration timeously and bring it to the attention of the persons concerned, before it has far-reaching implications in a variety of fields.

This Government strives for clean administration, to expose corruption and to root out all corruption. I support the hon members for Yeoville and Newcastle in regard to performance auditing. The Cabinet recently also made decisions on more effective Government auditing, more specifically by means of the speedy implementation of performance auditing. Effective open-minded external auditing, and particularly performance auditing, can only materialise, as pointed out by the hon member Mr Douw, where the Auditor-General enjoys independence to a greater extent than experienced at the moment. The success of this approach in countries like the United Kingdom, Canada and the United States of America is clear proof of this.

One aspect that already appears evident at this stage is that performance auditing is a timeconsuming exercise. Experience abroad confirms this fact. If one is aware of the fact of the wide spectrum of Government functions that is still to be subjected to performance auditing, it appears to be absolutely essential that further momentum should be given to current attempts. I hope that next year with the new Parliament the joint committee will give special attention to this. Consequently I regard it as essential that the Minister of Finance, after consultation with the Commission for Administration, should have the necessary authority to take suitable action in accordance with audit findings to establish and maintain healthy staff practices in the Office of the Auditor-General.

I once again support the hon members for Yeoville and Hercules who pointed out the importance of training the staff and of seeing that we have sufficient staff in the Office of the Auditor-General. The principle of establishing greater independence regarding staff matters for the Office of the Auditor-General has already been accepted by Parliament through various resolutions of the then Standing Committee on Public Accounts with the recommendation that it has to be embodied in law as far as possible.

In filling the need of expanding the authority on organisational and establishment matters, it could be of special significance to this office in that it would grant the necessary flexibility and momentum to new approaches implemented during recent years. In this regard the advantages that could be achieved by performance auditing are reasonably obvious.

Since April 1987 the Office of the Auditor-General has been operating on a trading account offering the unique opportunity to exercise control over its activities and thus promoting effectiveness. In this way, for example, the utilisation of all man-hours in the Office of the Auditor-General is being accounted for. This system, as well the auditing of the Office of the Auditor-General by an independent person appointed by the Minister of Finance in accordance with the Bill, and the existing powers of the commission to perform an inspection of the Office at any time, will still ensure that the Office of the Auditor-General operates within conservative staff and financial practices at all times. It is also necessary to audit the Office of the Auditor-General.

Summarised, the aforementioned means that I am convinced that audit, for various reasons, will only work to better advantage if greater dispen-sational powers concerning staff matters are entrusted to the Minister of Finance by law, as pointed out by the hon member for Yeoville.

I thank hon members once again.

Mr Chairman, we gladly support the Financial Institutions Bill. It is well known that requests have been directed and proposals have been made to the Government from various sources and over an extended period regarding the abolition of prescribed investments. The LP of South Africa welcomes the fact that the Government has seen fit to take this step as part of the 1989 Budget package and for that reason we support the proposed amendments.

The LP believes in the allocation of resources in compliance with market disciplines, and the result of these amendments will be that one will be able to compete at market prices for the investment of the capital resources of the RSA. This in turn will also result in those investing their savings in instruments such as pension schemes and insurance policies being able to expect more real returns on their savings, which could in turn encourage further saving. This could counteract the present tendency of dissaving. It is not necessary for me to convince hon members of the importance of saving and capital formation by means of saving at this particular stage in the development of our country.

I want to give the hon the Deputy Minister the assurance that every time the Government wants to introduce measures which seek to abolish firstly the discriminating measures which apply to the various participants in our economy, secondly the unnecessary control of our economy, thirdly the more purposeful utilisation of our economic resources, and fourthly the obstacles in the way of the entrepreneur in our economy, he can rely on my co-operation as well as that of the LP.

However, I wish to focus my attention on another aspect. The present prescribed investments in Government and semi-government stock are secure investments, and resulted in a certain safeguarding of the solvency of institutions.

The abolition thereof will result in institutions such as insurers, pension funds and friendly societies enjoying freedom of investment and that in turn, could result in smaller institutions, which experience a lack of expertise and in which communities such as my own have a greater involvement, attaching great importance to sound investment directions for assets. Therefore I welcome the fact that the legislation makes provision for the hon the Minister to issue directions in order to ensure sound investment portfolios by means of these institutions.

I wish to congratulate the hon the Deputy Minister, the Department of Finance and the Government on this course of action, and I want to predict that South Africa will shortly reap the economic benefits of these amendments. We gladly support this measure.

Mr Chairman, I gladly associate myself with the previous speaker, Mr Douw, who said that he was very pleased that this Bill would encourage saving. We all know that saving and productivity form the cornerstones of a good and sound economy.

In this Financial Institutions Amendment Bill provision is being made in order to abolish the obligation on insurers, pension funds and friendly societies to invest in prescribed assets.

In addition the hon the Minister of Finance, through his registrar, may now make regulations that restrict the amount which the abovementioned institutions may invest in specific kinds or categories of assets.

On various occasions these organisations made representations to the Government for the abolition of the obligation to invest a part of their funds in so-called prescribed assets. We on this side of the House are serious about promoting the interests of the consumer, and the reason why we support this Bill is that after thorough deliberation, just as in the memorandum, we support the following considerations, recommendations and advantages. I should like to quote them to the hon members:

1. (a) Compulsory investments in prescribed assets create a captive market in which interest rates are of necessity lower than market rates.
2. (b) The lower rates are detrimental to financial institutions and those persons—pensioners and policyholders—who invest their savings with such institutions.
3. (c) Lower rates on public sector stock obstruct the ability of the South African Reserve Bank to operate in the open market. They also distort the allocation of scarce resources in the sense that the activities of the public sector are subsidized at the expense of other sectors.
4. (d) Since potential investors avoid a captive market, the development of an active market capable of providing liquidity and competitive prices for investments in public sector stock is inhibited.

True to my style of short and sweet, I just want to say that we support this Bill.

Mr Chairman, for some time now insurers, pension funds and friendly societies have been investing their money under constraints and have thus far been required by law to invest some of their funds in prescribed assets. The problem with these assets is that the returns have been very low and as a result affected their clients.

On several occasions various representations were made to the Government to abolish having to invest in prescribed assets. This Bill does just that. Insurers and pension funds will now no doubt be given an open hand to invest in various portfolios where yields would be better for their clients. I am sure this is a step in the right direction and towards free enterprise which no doubt will see a large percentage of investments going into the equity portfolio. An economist predicted some time ago that if this was abolished, about 60% of the funds would be invested in that area.

I have one reservation, however, in that most of the returns from these investments are to a certain degree tax-sheltered. I only hope that we do not have to come back and pass another law stating that these things have to be taxed hereafter. We support this Bill.

Mr Chairman, I thank the hon NPP member for Tongaat for his party’s support of the legislation before this Extended Public Committee.

*I also want to thank the previous hon speakers, namely the hon member Mr Douw and the hon member for Delmas, for their support.

†In essence this Bill gives effect to the announcement made by the hon the Minister of Finance in his Budget Speech on 15 March that prescribed investments applying to certain categories of financial institutions would be abolished. Perhaps the single most important recommendation of the Jacobs Committee of Inquiry into the Marketing System for Gilts in 1988 was that the Government should abolish the prescribed asset requirements that apply to certain financial institutions.

This applies to insurers, pension funds and friendly societies who are required to invest a portion of their funds in so-called prescribed assets. The requirements were originally applied for solvency reasons to all financial institutions. Subsequently, when South Africa was facing fairly difficult situations and circumstances, the requirements were raised to ensure a greater flow of loan funds to the Exchequer. The requirements were subsequently relaxed and several other adjustments were made in order that interest rates should be much more market-related.

It is recognised, however, that the still high proportion that must be invested mainly in fixed-interest, non-growth assets may inhibit investment in a market which should be promoting job creation which is so vital to the growth of the South African economy.

The life insurance industry in particular has been delighted at the recent development for which the Life Offices’ Association has been pressing for many years. Not only will greater freedom to invest within prudent guidelines be of benefit to members of pension funds and life insurance policy holders, but the release of a captive market of investors is also expected to stimulate the gilt and other markets which would be formed in terms of the Financial Markets Control Bill which is also before this Extended Public Committee today.

The abolition of the prescribed asset requirement is not absolute, however. While greater investment freedom is desirable, in the case of the smaller and less knowledgeable institutions they may not necessarily have the expertise for sound investment policies. Therefore protection is given in this Bill to policy-holders and members of funds under clauses 7, 9 and 11, enabling the Minister of Finance to make regulations in order to impose limits as regards amount and extent. This was an amendment introduced by the joint committee, which felt it was essential to define—for the purpose of effective control— the extent to which investments may be made in particular kinds or categories of assets so as to ensure a sound spread of investment risks and to authorise the Registrar to grant exemptions where he considered these desirable.

While regulations have not as yet been announced to replace the prescribed asset requirement, there has already been a marked movement in the equity market. It seems to have been triggered by the anticipation of additional buying power. The equity market has already broken through record highs on the industrial board and continues to move upward. While this may be excellent for investor morale, one cannot help but recall the market crash of 1987 and wonder whether investors should not be more cautious at this stage of development.

Thus the early issuing of a set of investment guidelines is urged in order to quell the uncertainty in the market. It has been suggested in some quarters that prescribed investments should be phased out gradually, some interim percentage introduced and a progressive reduction applied, in order to test the market. This sounds like a fairly sensible and prudent approach to the problem, and I am sure that the Registrar of Financial Institutions, Mr Theo van Wyk, will give all aspects his expert consideration.

The major investors in the equity market today are the life insurance companies. I should like to refer to some aspects which the industry considers essential and deserving of urgent attention. The first concerns the taxation of underwritten provident funds. Currently underwritten provident funds business ranks as taxed business, and has to hold prescribed investment at a 33% level, while the so-called private provident fund business ranks as untaxed business and has to hold prescribed investments at a 53% level.

Before the 1988 tax year the higher prescribed investment requirements more or less cancelled out the tax advantage enjoyed by private funds, and the industry did not press for this anomaly to be removed. The increase in tax on underwritten funds last year seems to have placed this group at a distinct disadvantage. Representations were accordingly made to the Commissioner for Inland Revenue in December last year that the two forms of provident funds be placed on an equal tax footing.

The position of underwritten provident funds, it is contended, is further complicated by the current trend in the growing trade union movement to move away from pension funds to provident funds. These underwritten funds will be even more disadvantaged tax-wise once the prescribed investment requirements fall away. The unions may well wrongly interpret the higher rate of tax as an attack on their preferred retirement funding method. At the same time brokers who are in the know are advising employers and trade unions to discontinue their underwritten provident funds and replace them with private provident funds, with resultant turmoil in the marketplace.

It is essential that these problems be dealt with as a matter of urgency and that these two forms of provident funds be placed on an equitable tax footing.

The second plea from the insurance industry is that the maximum deduction of retirement annuity contributions for tax purposes be increased on a regular basis, in the light of keeping retirement funding in step with inflation. We are going to have to invest additional funds. The present maximum of R3 500 or 15% of income for self-employed persons is rapidly falling behind the provision that can be made for members of pension funds, and this limit has been there for 12 years. It is considered by the industry that a maximum deduction of R11 000 per annum would be more in keeping with the present retirement funding requirements. Personally, based on current investment returns in the insurance industry, I would support an increase to a maximum deduction of R6 000 per annum with a proviso of regular annual increases.

Possibly consideration could be given to greater amounts or percentages for persons over 50 or over 60 because many of them entered a fairly new industry fairly late in their working careers and require greater contributions to ensure an adequate income on retirement.

Returning to the Bill under discussion, a further factor influencing the decision to abolish the prescribed asset requirement was— the hon member for Delmas referred to this—that lower interest rates on public sector stock restrict the ability of the South African Reserve Bank to operate in the open market. They also distort the allocation of scarce resources in the sense that the activities of the public sector are subsidised at the expense of other sectors. Freer competition and market related prices for investment in public sector stock will be facilitated and this is welcomed in financial circles.

Finally I would like to congratulate the officials of the department, the secretary of the Joint Committee on Finance, the hon the Minister and the hon the Deputy Minister for the efficient and expeditious handling of the spate of legislation placed before the committee in recent weeks. I have great pleasure in supporting the Bill before us.

Mr Chairman, it is not my turn to speak.

Order! In terms of Rule 89 the presiding officer calls upon speakers according to a list in front of him. The hon member for Heilbron is the next speaker on the list.

They have messed things up again. They cannot do anything right. Trust a Nat to mess things up.

Order! Is that a reflection on the Chair? If so, the hon member for Johannesburg North must apologise.

Mr Chairman, it is not a reflection on the Chair and I was not referring to you. I was referring to the hon Whip of the NP.

Order! There is nothing wrong, as far as the Chair is concerned, with the hon Whips of the NP or with any other hon Whips. I call on hon members in terms of the list that I have. In terms of the list that I have the hon member for Heilbron is the next speaker.

Mr Chairman, that is quite correct, and I accept that.

Order! I call upon the hon member for Heilbron.

Mr Chairman, I am afraid that my list has left me in the lurch.

Order! I have repeatedly pointed out that in terms of Rule 89 members are to be called according to the list that the presiding officer has. I have repeatedly called on the Whips to correct the list when necessary. It is, however, not the duty of the presiding officer to correct the list.

Mr Chairman, on a point of order: I must tell you, with great respect, that you can say that you have a list, but we also have lists. If different lists are, in fact, being dished out, as far as we are concerned we shall walk out of this debate. I must tell you, Mr Chairman, that we cannot have a system where you claim to have lists and we have different lists. You have now embarrassed the hon member for Heilbron because he is not ready to speak and, as far as we are concerned, if we cannot speak in this debate we will walk out. We have no problem with that.

You can say you have a list, but we also have lists. You can do what you like, but as far as I am concerned, with great respect, if you want to take this attitude we shall walk out of this debate and have nothing more to do with it.

Order!

We shall either abide by what are equitable rules which are applied in a proper manner or, alternatively, we do not want any part of it!

Order! There is no reason for the hon member for Yeoville to get excited.

I am excited!

Order! The fact of the matter is that a member of his party will have another chance to speak and there is ample opportunity for the Whips to correct the list. It is not necessary for the hon member to get excited.

The Rules were approved by the Committee on Standing Rules and Orders and I have to apply the Rule as it stands in the rule book.

Mr Chairman, then we do not want to speak in this debate and we withdraw from it. We want nothing to do with it and we can just as well go home.

Harry, you will be mentioned in the paper!

Order!

Mr Chairman, on a point of order: Even the list which we received is not correct then. The previous list was not correct either and I want to appeal to you as presiding officer to ensure that the Whips of the Government party see to it that these lists are rectified.

Order! It is not the duty of the presiding officer who has the list in front of him to correct it. The list in front of me corresponds with the list which the secretariat received at the Table. It is also not the function of the Table or of the presiding officer to ensure that the lists are correct. The hon member for Heilbron may proceed.

Mr Chairman, may I enquire how much time I have left?

Order! The hon member for Heilbron’s time starts now.

Mr Chairman, I am sure the hon member for Pietermaritzburg South will pardon me if I do not react to him because unfortunately I was in no position to be able to listen to him.

The proposed amendments before us are a natural consequence of the State’s desire to remove the markets in South Africa from State control and to have less control in the economy. We shall then be able to listen to people outside who say that the State should be less involved in the economy of the country, exercise less control and produce a smaller portion of the national product.

The way in which the State acquired part of its funds in the past was that the State actually prescribed how funds were to be invested, because it was considered that the Government should stand in loco parentis and take the responsibility for everybody in this country. By means of the proposed amendments to the legislation, we are to a great extent relinquishing this right to the paternal role which we accorded ourselves regarding the finances of everybody in South Africa.

By means of these proposed amendments to the legislation we are telling financial institutions of South Africa that we are able to trust them to ensure that, for the sake of operating good business, they will see to the interests of the people who invest their money and are insured with them. It is true, however, that a great factor in the origin of this legislation was also to ensure that the State could obtain cheap money. From that point of view, this legislation was totally wrong.

I think that it was unfair of the State to use public money to subsidise its own expenses. That is why these proposed amendments to the legislation which remove the provision on prescribed assets represent progress and are good for South Africa. Now nobody subsidises State interest rates. The State’s entire expenditure now falls under the scrutiny of the voter out there.

If a figure were taken to this order and it were assumed that about R28 to R30 billion of the R56 billion which the State borrowed last year had been acquired from prescribed assets, and it were further assumed that those prescribed assets were now being removed, if a 0,2% rise were to take place in capital market rates because the State now had to obtain its funds in the open capital market, one would come to the alarming conclusion that the State would have to pay additional interest of between R125 million and R220 million in a single year.

If one examines the movements on the capital market, it appears that it is within the limits which the additional State interest would amount to. It could be higher but at the moment it appears that it will be of the order of the additional interest charges to the State. In other words, up to the present the borrower in South Africa has subsidised the Government’s financial charges and they amount to between R125 million and R200 million.

As a farmer, I find that this legislation unfortunately has a most disappointing effect.

You are a wine farmer!

No, I am not a wine farmer. In my part of the Free State the Land Bank imposes strict measures! It is a fact that this legislation has caused cheap prescribed funds which the Land Bank was able to obtain in the past to be phased out since August of last year on the change in the Bank Act and now also in terms of this Bill. This means that the Land Bank’s money now becomes more expensive to the farmer. Except for production inputs, it appears that Land Bank costs will ultimately become between 0,5% and 1% more expensive. [Time expired.]

Mr Chairman, the Financial Institutions Amendment Bill arises from the Government’s intention to remove the prescribed assets obligations. The institutions that were obliged to invest in prescribed assets were registered insurers, underwriters at Lloyds, pension funds and friendly societies. This Bill now abolishes the prescribed assets requirements and releases scarce funds to be employed profitably by the institutions for the benefit of policy holders and beneficiaries.

The Bill arises from various recommendations by the Life Offices’ Association and the pension fund operators, the De Kock Commission of Inquiry into the Monetary System and Monetary Policy of 1985, and the Jacobs Committee of Inquiry into the Marketing System for Gilts of 1988. Both these committees recommended the abolition of prescribed assets.

This brings us to the next question. While prescribed assets were a cheap source of funding for the Government, the removal of such requirement will put the Government under pressure to borrow funds for the deficit in the Budget. That, in turn, will minimise the funds available to service welfare functions, pensions and so on. However, I am sure that the Government must have some idea as to where they will find the rest of the funds. Maybe we will not hear the answer until after the elections. That being so, we will leave it alone until we hear more about it. For the time being, the Bill is in keeping with deregulation and we therefore support it.

Mr Chairman, I think that we have a very interesting piece of legislation before us. I think it will be very illuminating to see whether insurance companies and pension funds invest more in risk investments. One of our well-known insurance companies has announced that it intends transferring R2 billion for new projects. We are grateful for this because, if all this money has to be spent on yet more flats and office buildings, we are facing great problems.

The hon member for Heilbron mentioned here that in the present situation the Government borrowed money cheaply. This was not the case originally. These requirements were instituted to protect policyholders. That was the original reason. Only after a time use was made of, let us say, cheaper money. It has perhaps become a more important objective than the necessary protection of policy holders.

The hon member for Pietermaritzburg South summarised the various disadvantages of the current situation such as that the State pays interest at a lower rate. The result is that people making pension payments at certain times receive a negative rate of interest on the money which they have invested with insurance companies because the inflation rate is sometimes higher than the interest which is paid on these investments.

If such a large part of the stock market operates at a lower rate of interest than market rates, it is understandable that a new or livelier market cannot develop. What is of importance—this was mentioned by various hon members, such as the hon member for Heilbron among others—is that, if the State borrows money cheaply, more cheaply than it would normally obtain in the market, it is an inducement to squander money. I think this is brought strongly to the fore in various reports by Dr Wim de Villiers.

I should also like to refer here to the IMF report of 1988 in which the IMF reveals that this country actually has very little money available in capital funds because savings are low and we receive no money from overseas any longer. The IMF says in its report that we should mobilise our domestic savings in a better way. It also says that we should put existing capital to the most effective use. This is a very important step.

At the moment our insurance companies are holding approximately R36 billion in cash. These are recognised as prescribed investments. I do not think that we are necessarily receiving the benefit which we would like. We think we are obtaining huge sums for the State but this is not so because many of these investments are in deposit accounts at banks at the moment. On the removal of this—we are referring only to the R36 billion in cash—we are opening doors, which will have a very interesting effect in future.

It was stated in the various committees which investigated this matter that we should continue to safeguard the policyholder. This is specifically why it is stated that maximum limits are set on investments because, if all these savings are used to invest in flats and offices, we shall have achieved nothing with this Bill.

It should also be established how the assets of these institutions are to be valued. I may mention that we have already progressed in discussions with various institutions such as the Life Offices’ Association, the Pensions Institute of Southern Africa and the Association of Shortterm Insurers. We made submissions to all of them on investment requirements. These requirements in the form of draft regulations have already been accepted by them and I think that there is hope of our perhaps being able to proceed with the implementation of this Bill in May, after it has been passed.

†The hon member for Pietermaritzburg South made a very important point with regard to provident funds. I have just received from Mr Van Wyk the information that the Tax Advisory Committee spent a lot of time on it yesterday, and we hope to give urgent attention to this problem. With regard to the tax allowance, it is a very delicate situation and I think that it may have to wait for the next budget.

*Mr Chairman, I want to thank all hon members who participated in this debate. I think we do not all realise what interesting and positive possibilities this legislation will hold for South Africa. I look forward to it with great interest. As the IMF said, we are mobilising our money better now. May we also spend it wisely.

Mr Chairman, I would be shirking my duty if I did not comment on what has just happened here. We on the opposition side of the House do not feel very happy about the fact that only a section of Parliament is present here while we are dealing with legislation. This is unacceptable to us.

It does not matter who is the guilty or innocent party in the mix-up that has just taken place here, but it gives one an idea of the seriousness with which these matters should be approached, and I must express my opposition to this.

What is very important at this moment is that the three concepts of solvability, profitability and liquidity are very important in every business. As we are specifically dealing with the solvency margin in relation to re-insurance in this Financial Institutions Second Amendment Bill, I think that we should always bear those three concepts in mind. Clause 3 proposes that a short-term insurer shall indicate how he has satisfied himself of the adequacy instead of only the reasonableness of the provision of an insurer in so far as it affects unintimated claims and income tax liabilities. We find nothing wrong with this.

As far as clause 7 is concerned we want to state that the contingency reserve of 10% of the premium income which may be maintained at the proposed rate of 20% of such reserve per annum over a five-year period, for the building up of such a reserve, is very clearly defined here. We have no problem with this either and consider it to be a good arrangement.

Clause 13 is essential in this amending bill. The problems experienced with section 20bis of the Insurance Act can be anticipated in this clause, and it can then be made much more streamlined.

This was a very bulky Bill and I do not want to stand here repeating the contents of the Bill in its entirety. However, I should just like to point out that in this legislation we even devoted part of our discussions to the Pension Funds Act (Act 24 of 1956); the Friendly Societies Act (Act 25 of 1956); the Inspection of Financial Institutions Act (Act 38 of 1984) and the Stock Exchanges Control Act (Act 1 of 1985), because they would have a bearing on these financial institutions.

We on this side of the House want to thank the officials very sincerely and congratulate them on the very well-prepared piece of work they have furnished. We are therefore pleased to support this amending Bill.

Mr Chairman, the Bill before the Committee amends four different financial Acts, namely the Insurance Act, 1943, the Pension Funds Act, 1956, the Friendly Societies Act, 1956, the Inspection of Financial Institutions Act, 1984, and the Stock Exchanges Control Act, 1985.

As the Act now stands there is insufficient protection of money deposited by intermediaries of insurance brokers. The intermediary has to deposit guaranteed money into a trust account. Consequently the intermediaries experience practical problems particularly concerning reconciling and paying over to insurers money received by them within a certain prescribed period.

Clause 13 substitutes section 20bis of the Insurance Act, 1943, whereby it streamlines the procedure and provides for alternative forms of providing guarantees by eliminating the trust account route and compels the furnishing of guarantees for the intermediaries who handle moneys on behalf of the insurance companies. This clause also reduces the minimum amount of a guarantee to R10 000 and pegs the maximum of R50 million. It also makes a guarantee issued by a registered insurer admissible as legal tender.

Pursuant to the amendment in 1971 of the Stock Exchanges Control Act, merchant banks were given a limited authority to carry on the business of buying and selling specific classes of securities which in terms of the Act is normally the domain of stockbrokers. By virtue of the 1985 amendments to the Banks Act, 1965, the demarcation of banking institutions into various classes, such as commercial banks, general banks and merchant banks, was abolished. In the spirit of the market competition clause 25(a) of the Bill now allows all banks the right to enjoy the rights and privileges of carrying on the business of buying and selling specific classes of securities.

Clause 25(b) of the Bill makes provision for the establishment of two kinds of building societies, namely mutual building societies and building societies with equity share capital. The latter is a profit-orientated society, which concentrates on lending huge amounts of money at high interest rates and has a tendency to ignore small borrowers. The former, a type that we have come to know well over many years, is not profit-orientated. It does not pay dividends as such but rather just a fixed amount of interest. The mutual building society is a great incentive to small-time savers—those who like to save their few rands and cents. This is of very great benefit to them, and this Bill provides for that.

Finally, this Bill also amends the Pension Funds Act by circumventing the practice of certain selfish people who leave their pension benefits to nominees rather than to their dependants. This Bill also takes care of that.

Mr Chairman, I would like to thank the hon member for Camperdown for his very positive approach and attitude to this Bill and for his support.

*May I just say the following in respect of the remark about legislation which the hon member for Delmas made in the Committee. I ask myself precisely how many members of financial committees who are sitting here today, know exactly what is going on in these laws. If it were not for the Registrar of Financial Institutions, I would still not have known anything. Even now I know hardly anything, but thanks to the Registrar I at least know something, and I thank him for that.

The question then is this: If the persons who serve on joint committees of finance have problems understanding the full implications and ramifications of the legislation, what purpose does it serve to bring in people who have no understanding of the legislation whatsoever, to come and help to discuss the legislation? I think that the hon member for Delmas will concede that since no voting takes place here and that in any case he would have to say in his caucus: “Listen, we agree with the Act”—or as the hon member Mr Douw has told us repeatedly, “I must first clear the legislation with my caucus”— we do not really need other people here than those with a financial background when we discuss these financial measures.

This Bill for insurers is of course a direct outcome of two matters. Firstly it is a fact that since there are no longer any prescribed funds in which one is required to invest, alternative measures must be adopted to protect the public. Secondly the direct cause of this Bill is the Melamet investigation into the AA fiasco. The recommendations of the Melamet Commission on insurers, which resulted from that investigation, are included in this Bill.

Hon members will see that the basic premise is firstly that it is ensured that the people who do the reinsurance are in South Africa, so that there can in fact be a claim to the reinsurer’s money. Secondly it is clear that an attempt is being made to ensure that the reserves, both the normal reserves as well as the contingency reserves, are sufficient. That is why hon members will find certain definitions and concepts in the first few clauses of the amending Bill which refer specifically to the concepts that are used when reference is made to the new kinds of guarantees that are established by the contingency reserves and increased solvency margins. The reason for this is so that one may know exactly what is being referred to. For example, the solvency margin is referred to as being calculated as the assets minus the liabilities plus the compulsory reinsurance. That safety margin has been adjusted from 10% to 15%, which implies a strengthening of the reserve.

In the same way there is another fund. I do not want to go into too much detail, because my time is limited. The other fund will also be brought to full strength within five years. One does indeed receive tax advantages on this because the funds that are used to create this reserve are not taxable.

I want to focus in particular on the substitution for section 20bis of the Insurance Act of the new section as contained in clause 13 of the Bill. We had to consider two opinions regarding this section. The first opinion was given by the South African Society of Insurance Brokers. This society represents 70% of the insurance brokers in South Africa and they do 80% of the brokers’ business in South Africa. Their opinion was very positive and they said that we were on the right track.

In comparison the Insurance Brokers Board of South Africa—that is those who do only 20% of the business—were very negative about the substitution of section 20bis by clause 13. They raised a whole series of objections and spoke about a free market and state regulation.

I want to explain to hon members what section 20bis deals with. In the past one could adopt either of two courses with the premium payments made by clients. On the one hand the broker could deposit them in a trust account under his control, and on the other hand guarantees for the money could be issued.

The objection of the Insurance Brokers Board of South Africa is that the small brokers, who are struggling to survive, are being discriminated against because the right to deposit premium money into a trust fund over which they have control, will now fall away. When they object to that they are actually saying that they are being deprived of their banking activities because they were after all able to deal with and invest that money as they thought fit.

It is a fact that this trust money has nothing to do with insurance, but with something completely different. Therefore the right of which we are depriving them has nothing to do with their insurance work per se, or the right to do such work. As a matter of fact when one considers the problems experienced in the past, one finds that in the most cases it was in fact the premium payers who suffered the most when their money was lying in those trust accounts, because those funds usually went one way. On the other hand the people to whom guarantees were issued, experienced no problems.

The Insurance Brokers Board of South Africa objects inter alia to the fact that they will now have to pay for guarantees, and they claim that it will result in considerable extra costs. Depending on how strong one’s account is, guarantees can cost as little as 0,5% per year. I do not know what the top limit is, but one can get away with up to 0,5% per year. If it is taken into consideration that the agent’s income is approximately 33% of the premium, his additional costs involved in the guarantees amount to 1,5% per year. Therefore the complaint is not about that 1,5%, but about the fact that they can no longer control and apply the trust funds. The incorrect application of the trust funds often resulted in trouble for the policy holders.

I am very glad that these amendments have been introduced as a result of the Melamet Commission. I am confident that we shall shortly— probably next year or the following year—see the less urgent amendments of the Melamet Commission embodied in a new amending Bill.

Mr Chairman, I am pleased to speak after the hon member for Heilbron, and I want to agree with him that this legislation has brought about very technical amendments and that one was therefore dependent on the help of the officials to a large extent.

I also want to disagree with what he said when he crossed swords with the hon member for Del-mas. I am one of those who believes that legislation should be dealt with at a joint sitting of Parliament, and not in an extended committee. I do not believe the Rules of Parliament make provision for this.

As the hon member for Heilbron said, many of these amendments result largely from recommendations of the Melamet Commission, and this Bill contains many highly technical amendments relating to various kinds of financial institutions for which there is statutory supervision as far as solvency and liquidity are concerned.

I do not intend to discuss the Bill in detail, clause for clause, but I should like to touch on a few aspects which to me are matters of principle.

The clauses from 1 up to and including 19 contain important proposed amendments to the Insurance Act which relate specifically to short-term insurers. The object of these amendments is to set improved requirements in terms of which these insurers have to maintain reserves to enable them to pay out claims. They also make provision for the creation of a further contingency reserve which may only be utilized with the approval of the Registrar of Financial Institutions.

It is every country’s wish to have sound financial institutions that can give the public value for their money, specifically in the case of short-term insurance. The public demands certainty with regard to cover for those risks against which people want to insure themselves.

There is more to the matter. With the integrated financial services industry which our country already has, the insolvency of one institution can also detrimentally affect the solvency of other institutions and can send shock-waves through an entire industry and consequently do damage to the economy as a whole. This amendment will put the management and financial supervision of short-term insurers on a more scientific footing and must therefore be welcomed.

Another principle dealt with in the Bill relates to the proposed abolition of the existing prohibition preventing stock-brokers from advertising their services. The stock exchange has served the country over a period of more than 100 years, and against the background of increasing competition to obtain the investments of the public, I think that the proposed amendments allowing stock-brokers to advertise their services and expertise in a regulated fashion, should be welcomed.

The Bill also provides for a number of other amendments of lesser importance. I want to conclude by saying that the proposed Bill has our full support.

Mr Chairman, we wish to support this Bill, many of the provisions of which fall under the general heading of “consumer protection”. It protects those unsuspecting members of the public who, through no fault of their own, suffer financial loss. In this regard, the report of the Melamet Commission and this Bill, which flows from the recommendations of that commission, are to be welcomed.

I wish to deal with one aspect in particular, namely that of insurance brokers, which was dealt with in some detail by the hon member for Heilbron. Generally speaking, financial matters are becoming increasingly complex and the average man in the street, who has a concern for his own well-being and the protection of his assets, is unable and cannot be expected to have a full understanding of everything that relates to these matters in the financial markets, and hence in the insurance industry there has been the growth of the broking profession.

Not only does the broker offer advice which can be good or bad depending on his skills and his professionalism, but he also often acts as a conduit for payments between the client and the insurer. Here his service cannot be good or bad. It has to be correct and the rights of his client and the insurer have to be protected.

Clause 13 of the Bill specifically deals with premiums paid to brokers and tightens up on the protection of the insured’s interests. Subsection (5) states—I paraphrase it—that payment of a premium by a policyholder to an agent or broker shall be deemed to be specific performance in terms of his policy. However, the clause goes further than that. Previously the broker was required to deposit the premiums received into a trust account. That has been changed, as has been dealt with by the hon member for Heilbron, in that now the back-up of a specific guarantee or security has to be furnished by the broker.

We believe these changes to be of fundamental importance. The requirement of guarantees in favour of the SA Insurance Association for the benefit of all insurers removes the risk to the insurer that amounts due to him may in fact eventually not be paid to him. At the same time, the policyholder—the consumer—is protected. Once he has paid his premium to a broker, he has met his obligations in terms of his policy. Amendments such as this one in particular reduce the risk of financial loss and will lead to further stability in the insurance industry.

With these brief comments, we support the Bill.

Mr Chairman, we would like to thank the hon member for Pinelands for his support for the Bill, and I would like to refer to some of the things he mentioned during his speech.

*I should also like to follow up on what the hon member for Heilbron said and discuss certain points he emphasised here.

I believe it is very important for the Government of a country to accept responsibility for the protection of the consumer, for generating greater competition and for removing restrictions on measures and regulations which promote this competition. I believe that this amending Bill specifically provides for the removal of these restrictions with a view to greater competition and greater protection. Numerous speakers have already referred to this, and I think that in particular the contingency reserve of 10%, which can be phased in over a five-year period on the recommendation of the Melamet Commission, is a typical example to illustrate that there is going to be greater stability and peace of mind for the consumer. In addition, the increase of the solvency margin to R3 million, which can also be phased in over a period of time, is evidence that this Act looks to the interests of the consumer.

I feel that an important point must be emphasised in respect of pension funds in that de jure and de facto dependents receive priority and will be the first to qualify for benefits from the estate of the deceased. Only then will beneficiaries receive limited benefits from this estate or pension.

If we examine inspection, which embodies another protective measure, I feel that it is important to note that the office of the Registrar of Financial Institutions, with its limited staff, will not always be able to carry out routine and special inspections, and that the registrar’s office can issue directives to the private sector and an auditor or actuary can be appointed to carry out these inspections. Because this is beneficial to the depositor and the policy-holder, the costs of such an investigation can be borne by the parties concerned and is their responsibility. This recommendation is also in line with a recommendation of the Melamet Commission.

In respect of the control of stock exchanges, I believe it is important for us to ensure that greater competition can be incorporated, since stockbrokers will in future be allowed to advertise on a regulated basis. Conditions can be drawn up by the Stock Exchange in consultation with the Registrar. The Registrar is empowered to change or to cease the publication of advertisements, brochures or similar documents, at his discretion, if they do not comply with the measures laid down.

I therefore want to support this Bill on behalf of the governing party because we believe that it is to the benefit of competition, protection and the betterment of financial institutions in this country.

Mr Chairman, once again this Bill has been dealt with by quite a number of hon members this afternoon and some of the salient points have been explained. I was concerned about clause 13, but I think that was amply covered by the hon member for Pinelands. However, there was concern for consumer protection, but I think intermediaries having to take out insurance cover takes care of that because the consumers will then be protected.

Clause 21 deals with the Pension Funds Act and dependants of a member of a pension fund. If the fund does not become aware of any dependants within a period of 12 months it can pay out the amount of money to the nominee designated in writing. On the other hand, if the fund is able to establish that there is a dependant within the 12 month period, the fund will have the right to pay for the maintenance of that dependant in spite of a nominee being designated. I think this is in the right direction and we therefore support this Bill.

Mr Chairman, this morning we started by discussing clean administration in Government and now, with the third Bill under discussion, we have got onto clean administration in the financial world. This is part of the recommendations of the Melamet Commission which investigated the winding up of the short-term insurance business of A A Mutual. The recommendations were to protect the consumer and this was mentioned by various speakers.

I would like to refer to the improvements in respect of the calculation and the maintenance of technical and other claim reserves of short-term insurers as well as the introduction of the proposed new contingency reserve. This was also covered in the report of the Margo Commission which recommended it and it was accepted in the White Paper. It provided the Minister with powers to prescribe certain provisions in respect of the records kept in order to monitor the proposed new technical reserves efficiently. It is very important that we accept this recommendation because it is important to protect the customer. If the correct records are not kept, how can one monitor the reserves? We might also have to look at other industries in regard to the keeping of records.

Another very interesting amendment mentioned by various speakers was that allowing stockbrokers to advertise. I cannot understand why so many industries are afraid to advertise. If one mentions it to the doctors, accountants and pharmacists, one is accused of intervention. For me advertising is one of the basic ways to communicate one’s prices and services to the client and the customer.

A further interesting aspect of this Bill is the issue of getting information from unapproved portfolio managers. Linked to this is the fact that it is now possible to appoint inspectors from the private sector to assist the Registrar of Financial Institutions and also to bring in outside opinion and expertise. We cannot pay public servants salaries that compete with those in the private sector, who usually pay double what we pay public servants. It is very important because we have the problem of unapproved portfolios and unapproved financial institutions which are developing and advertising a 40% return on investment. This advertising might be a dangerous way of getting people to part with their money. I am glad that we have reached this stage with section 20bis of the Insurance Act, an old friend of ours. We have been trying for the past four years to solve it and I hope that next year we will not see it before us.

Another problem that was mentioned, is the question of pensions of dependants. That problem is also an old friend and we hope this has been solved and we shall not see it again next year.

I wish to thank all hon members who took part in this debate. It is a difficult Bill that we have discussed, but I think hon members and the committees who worked on it did a good job.

Debate concluded.

Mr Chairman, this principal Act has already been amended 17 times since 1944, and I consequently believe that it is essential to have another look at the legislation. It is probably unnecessary for me to emphasise that the South African Reserve Bank Act should be well-regulated. We all know how important this is. However, what I find very interesting is the first amendment that was proposed in respect of this amending Bill—I am referring here to Bill No 72A of 1989. Clause 12 states:

At a first glance it would appear that the impression created could be that South Africa should not stop making money. Money is very important and we cannot stop making money, even for a moment, because everybody wants to have money and everybody wants to spend money. However, this is not so. What is important in this case is that provision should be made for these activities, because the Mint is now included here.

The South African Reserve Bank is a private institution. It is important for us to know this. I think it plays a major role in the monetary functions of banking and of the State. This is why clause 9 is so important. This clause elaborates on the primary objectives of the bank. I think it is very important for these primary objectives to be made known to the public. The clause states:

At the moment people in this country are worried about the creation of money. We feel that it is a bit excessive at the moment, but we know the reason for this. Perhaps we shall come back to this when we discuss this matter further.

I think that at this particular time it is absolutely vital for the Reserve Bank’s affairs to be well-regulated. There were certain problem areas that were experienced with the principal Act. There were also certain powers and duties, which currently rest with the hon the Minister of Finance, which will henceforth be dealt with by the board of directors. They have now been transferred to them.

My time has almost expired, but I do want to emphasise that the increase in the number of directors from 12 to 14 is welcomed, particularly because there is one person who represents agriculture. I think that at this stage we should have had more such people there. However, we are satisfied with this. We support the Bill.

Mr Chairman, the South African Reserve Bank Amendment Bill is the eighteenth amendment to this Act since 1944. The present amendment—the Bill before the House—emanates from a recommendation by the De Kock Commission of Inquiry into the Monetary System and Monetary Policy in South Africa.

In this Bill certain provisions will be inserted in the South African Reserve Bank Act of 1944 to give effect to particular recommendations of the De Kock Commission, one of which is that the Governor of the Reserve Bank, through the Minister of Finance, has to table a report in Parliament. This has not been done up to now. It further rectifies the deficiencies experienced in the application of the Principal Act.

This is a streamlining Bill as far as the smooth functioning of the Reserve Bank is concerned. Some time last year we scrapped the South African Mint and Coinage Act and transferred the minting powers to the Reserve Bank, but this Bill makes provision for permitting the South African Mint to continue selling off what stocks they have, otherwise this would legally have been impossible.

What I am not too happy about in the Bill, is the increase in the membership of the board of directors. There is an age-old saying, “Too many cooks spoil the curry”. [Interjections.] I am unhappy about this, but as my party has decided to support the Bill I am compelled to support it, albeit against my better judgement! If I could have had my own way, I would have thrown the Bill out! Quite often we cry about increased taxation. We talk about the shortage of funds for vitally essential services to the taxpayer. By continuing to increase the bureaucracy, we cannot curtail expenses. I do not know what those two additional members are going to do on the board, other than saying aye or nay. After all, the Reserve Bank’s functions are not so intricate as those of a commercial bank. They do not have to look for clients—clients run to them! That is the crucial point in my argument.

I do not see the need to increase the membership on this board. I would have supported a decrease in the members on the board of directors. It is a good point of argument. We as legislators and protectors of the taxpayer in this country have to think in terms of the taxpayers’ interests. Every year we talk about curtailing and curbing expenditure, but day by day we are increasing the bureaucracy. I was surprised to see something about the Land Bank on TV last night. It is something I will raise during the debate on the Finance Vote of the Appropriation Bill in the House. Nonetheless, this Bill has a streamlining function as far as the smooth running of the affairs of the Reserve Bank is concerned. I therefore support it.

Mr Chairman, one cannot talk about so much financial legislation on one day without also referring to politics for a moment. I must say I really understand the dilemma of the DP when they forgot this morning to indicate what speakers of theirs were to participate in this debate. At this stage this party should devote some attention to very important matters such as trying to reconcile three irreconcilable leaders with one another, trying to reconcile three irreconcilable policies with one another, as well trying to get a philosophical basis in order to conceal the racist basis on which they are wooing White MPs on the one hand while chasing MPs of colour out of the party on the other.

Order! The hon member must move closer to the Bill. [Interjections.]

Mr Chairman, with regard to this week’s proceedings in which we functioned mainly in three different extended committees, it must have been easy for the DP to divide its members into three groups—the De Beer supporters, the Worrall supporters and the Ma-lan supporters.

Order! No, the hon member must obey my ruling. [Interjections.]

Mr Chairman, finally I just want to say, on this matter …

Order! No, I am not going to allow the hon member to carry on in this vein. [Interjections.]

Mr Chairman, it appears that with regard to this legislation which, I understand, will be supported by the DP, it is the De Beer faction that is present today in this Committee. [Interjections.]

Although this legislation does not bring about any visible or dramatic changes, and although in essence it merely supports in legislation what is already common practice, it is nevertheless true that this legislation will be an important milestone when the history of the Reserve Bank is written. In this legislation the full scope of the bank’s powers is being placed on record in one Act in that the Mint, and the legislation relating to it, are incorporated in the Reserve Bank legislation. It is indeed a rounding-off process in order to give substance to this important function which the Reserve Bank took over a while ago. This restructuring of the legal provisions relating to the Mint also creates an opportunity to repeal antiquated provisions on the old Mint Act.

Even more important than this regulating function performed by the legislation is the opportunity it provides to implement certain recommendations of the commission of inquiry into the monetary system and monetary policy in South Africa, the De Kock Commission. In terms of these recommendations the Reserve Bank is now legally bound to play its important role in South African monetary policy. Not only is the bank’s legal status affected by this, but also the bank’s stature as a very important and authoritative role-player in the formulation of economic policy and, in particular, monetary policy.

It is in clause 9 of the Bill where it is stipulated that the bank shall pursue as its primary objective monetary stability and balanced economic growth in the Republic, and that in order to achieve those objectives the bank shall influence the total monetary demand in the economy through the exercise of control over the money supply and over the availability of credit.

It is interesting to see how the authors of handbooks view the functions of the Reserve Bank. In the handbook Die Ekonomiese Stelsel van Suid-Afrika, of which one of the vice-presidents of the Reserve Bank is co-author, a distinction is drawn between operational functions and authority functions. In accordance with its operational functions the Reserve Bank is the custodian of the cash reserves of banks, a lender of last resort to the State and the banking system, a clearing house where banks settle their claims against one another and the sole issuer of bank notes, to which we will now also have to add coins. The fifth operational function of the Reserve Bank is that of storer of the country’s gold and other foreign reserves, as well as that of a trader in this capacity and marketer of South Africa’s gold. In the sixth place the Reserve Bank is the the central government’s banker.

This writer only mentions two functions as authority functions of the bank, namely the exchange of cash and liquid asset requirements with which the banks must comply in order to influence bank credit to the private sector, and the authority to make regulations with regard to the use of foreign exchange by South African residents.

This legislation will now give the writers of handbooks the opportunity to take a broader look at the functions of the bank, particularly those which Prof Lombaard and other writers call the authority functions.

However, in another handbook further functions are mentioned, for example in the book Ekono-mie: ’n Inleidende Studie by Stapelberg and Steyn. This book mentions the function of economic research, among others. This research is published in the well-known and authoritative quarterly publication of the Reserve Bank.

Recently a start was also made on the monthly publication of selected statistics, which is a good idea to try to give a more consistent impression of economic trends. This can also improve decision-making.

In terms of the legislation that is being discussed today, the President of the Reserve Bank will also be entrusted with reporting annually to the Minister of Finance with regard to the implementation of the bank’s monetary policy. This report will also be tabled in Parliament and should be a very important document from which everyone will be able to get an idea of current policy. By having it in written form, the policy is more accessible, as is the debate about the pros and cons of this policy. This can only be to the good.

Finally, this legislation completes an interesting cycle. The Reserve Bank came into existence in 1920 in terms of the Currency Act. although it came into existence in terms of the Currency Act, currency is now controlled by the Reserve Bank Act. The order has therefore been reversed.

Not only am I in agreement about the legislation, but I also wish the Reserve Bank all the best with the implementation of the important powers entrusted to it by this legislation.

Mr Chairman, right at the outset the hon member for Rissik made fun of the DP. As other hon members do I believe that the DP certainly has a right of existence in South African politics, and I believe that they will play a dynamic role on the road ahead.

The hon member has, to a large extent, covered what I wanted to speak about. However, I wish to mention that the amending Bill before the House is mostly aimed at making the Reserve Bank more streamlined and extending its autonomy.

I want to disagree with the hon member for Camperdown about increasing the number of directors from 12 to 14. I do not know whether the hon member for Camperdown remembers, but I specifically put a question in this regard to the Governor of the Reserve Bank.

I don’t understand you!

The hon member says that he does not understand. I know that he follows me very well and that is why I will continue speaking my mother tongue.

*On the joint committee the Governor said that the constitutional development of this country necessitated the number of directors being increased to 14. For the hon member for Camperdown’s information I asked specifically whether it meant that Black people would also serve on the board in future. It was not said in so many words but it was confirmed by implication. Therefore we accept that Black people will also serve on the board of the Reserve Bank in future.

†If the hon member for Camperdown has any qualms about that, then I am very sorry.

*I also want to mention the matter of confidentiality which is discussed in this legislation. According to the amendment before the House, confidential information can in future only be publicised if the sender as well as the receiver of the document gives written permission.

Here one thinks specifically about the major problems that faced the African Bank, and where the matter of correspondence between an official at this bank and one of the senior vice-presidents of the Reserve Bank was broached.

Naturally we know that the Cabinet Committee on Economic Affairs recommended that the Reserve Bank take over the South African Mint as a full subsidiary. The principal Act is being amended in order to empower the Reserve Bank to mint coins and with this in mind, to establish companies or to obtain interests in companies. We gladly support this Bill.

Mr Chairman, we support this Bill, much of which deals with the administrative matters relating to the transfer of functions of the South African Mint to the South African Reserve Bank.

Before going into any further details regarding the Bill, I would like briefly to respond to one of the comments made by the hon member for Rissik, namely the one dealing with the unfortunate incident this morning. I am afraid his facts are again incorrect. We did provide the names to the officials concerned and that was not the problem, despite what he seems to believe.

At a practical level this Bill deals with the issues of bank notes and coins. Although the growth of credit and credit transactions will, it is believed by some, lead to a cashless society, we are a long way from that point. Coins and banknotes remain the primary media of exchange and it is right that they should fall under the control of the Reserve Bank.

I would, however, like to highlight one clause of this Bill which is not of a technical nature and which I believe to be of paramount importance. This has been referred to by previous speakers. Clause 9 of the Bill inserts in the principal Act a definition of the primary objectives of the bank. As stated in the memorandum to the Bill, this definition is designed to meet the long-term need as a directional criterion in the exercise of the bank’s powers and the performance of its functions. The definition of the primary objectives of the bank reads as follows in the Bill:

These objectives of the bank are of fundamental importance to our economy. I believe it is regrettable that the clause does not go further. What is needed in addition is a clear undisputa-ble statement that the bank and the Governor of the Reserve Bank as its head must operate completely independently and free of all political pressure, for it is a fact that monetary policy, in addition to pursuing monetary stability and balanced economic growth, has very significant political implications. The present Governor’s attempts at depoliticising movements in key rates have been recognised in business circles. Whereas he himself has said that it would be naive to expect total independence for the central bank, he has also been quoted as saying that provided the bank stays within the broad framework of official policy, it should have freedom to operate in the money, capital and forex markets. In addition, he has on several occasions spoken bluntly on Government overexpenditure.

The achievement of the objectives of the bank as contained in clause 9 can be, and has often been, frustrated by political decisions. A very recent example was the decision to give teachers a 7% increase from 1 December 1988, followed by a 15% rise in all public servants’ salaries from 1 January 1989. I do not wish to argue the merits of these increases. I merely wish to point out that, despite the lofty objectives contained in clause 9, the best intentions of the bank can be and have been frustrated by political decisions.

We are now in an election year. Interest rates are high and there is an ongoing need to keep Government expenditure under strict control. As the political debate heats up, the temptation will be there to once again offer inducements to the voters. It has often happened before and I have no doubt that the Governor of the Reserve Bank will be placed under pressure by the politicians with an eye to winning electoral support. We sincerely hope that decisions will be taken in terms of clause 9, namely the achievement of monetary stability and balanced economic growth.

Mr Chairman, I would like to thank the hon member for Pinelands for his support of the Bill. I noticed that like the hon member for Rissik he tried to steer the debate in a political direction, but I will try to forego the temptation to take a political line.

Various speakers have drawn attention to clause 9 of this Bill. The hon member for Delmas read it to us in Afrikaans and the hon member for Pinelands proceeded to read it to us in English. It has to do with the control of money supply and the availability of credit and in essence goes to the heart of monetary policy. Certain questions arise here from which the hon the Minister could well comment on. It has to do with the control of the money supply and the methods that are to be used in this regard. Despite recent and continuous increases in interest rates, we still find that the money supply has increased by a rate that exceeds the guidelines laid down by the Reserve Bank. It is therefore to be questioned whether the money supply can be controlled by only using the tool of interest rates.

In the sixties the British government appointed the Radcliff Commission to investigate the effects of interest rates on the money supply. Their conclusions were that rising interest rates only increase the diffused difficulty of borrowing, but did not in effect control the amount of money in circulation.

One of our problems in South Africa is the low quality of financial journalism and the fact that many false concepts are put across to the man in the street. One of these is the popular concept that the money supply is increased by the printing presses in Pretoria working overtime. Government contribution to increasing the money supply is obviously affected by the deficit before borrowing on the Budget, but that is not the whole story. The question is now whether the Reserve Bank intends to use direct methods in controlling money supply, given the scenario that manipulating interest rates has not produced the required results.

The Portuguese government recently looked at direct methods to restrict money supply. Classical so-called direct methods include credit ceilings, deposit rate control, exchange control, import deposits, as well as so-called semi-market orientated methods, such as variations in liquid assets and cash reserve requirements.

A further problem in this regard is that of disintermediation. The De Kock Commission states that the weakness of monetary policy in the past was that it intended to equate monetary policy largely with the control of credit extended by the banking sector to the private sector. Insufficient attention was given to strategic important areas of broad monetary policy such as public debt management, open market operations and discount policy, on both the exchange rate and exchange control policy. It is in these areas that the battle for monetary stability is often won or lost.

There are of course limitations to the liquid asset system and a cash reserve system, which can be made to work efficiently only if the central bank is in a position to prevent undue increases in the cash base of the banking system.

This means that it must be able to prevent undue increases in its own total domestic and foreign assets. The commission has therefore recommended a market-orientated monetary strategy which means moderation and stabilisation of the growth of monetary aggregates, more effective control over disintermediation, the maintenance of realistic and market-related interest rates and the attainment of the real and market-related spot and forward exchange rates.

In the past, consideration has also been given to manipulating hire-purchase agreements by increasing the initial deposits and decreasing the time to pay. This, of course, has a distorting effect on the economy but is very often an effective method of controlling or bringing down money supply.

We are all aware of the dangers of inflation getting out of control and the prospect of a South American type of situation remains terrifying. I had the privilege of being in the Argentine when Isabella Perón was la presidente. She got the inflation rate up to approximately 600%, which is rather mind-boggling because it works out at about 2% a day. What brought it home to me was that my hotel tariff was adjusted daily in order to keep up with inflation.

The purpose of monetary policy is stability. In my opinion the authorities have had reasonable success in this regard and it is to be hoped that the adoption of this Bill will contribute towards amplifying that success. I am therefore pleased to support the Bill.

Mr Chairman, at the outset I wish to thank the officials of the Reserve Bank, and especially Mr De Kock and Dr Jacobs, for their willingness to help and explain clauses when we need them. During the past five years they were always prepared to help us.

I wish to speak in support of the South African Reserve Bank Amendment Bill. The South African Reserve Bank has an important function in the South African economy in respect of the fight against inflation, the management of the exchange rate and especially in respect of bank supervision. As a result any amendment to the South African Reserve Bank Act always attracts attention and the amendments must necessarily have a specific objective from which the integrity of the financial system and the economy in general will benefit.

Some of the amendments included in the Bill merely represent technical corrections which have to be made in any case. However, other amendments are more significant, and their implications must be analysed. Clause 9 of the Bill immediately attracts attention in this respect since the responsibility of the Reserve Bank to promote healthy economic growth is spelled out in this clause. It does not entail the promotion of economic growth at all costs, but rather the promotion of economic growth in the midst of the greatest possible price and exchange rate stability.

Clause 26 makes provision for a report on the way in which the Reserve bank carried out its mandate to be submitted annually by the Governor to the Minister of Finance, which report must subsequently be tabled in Parliament in terms of clause 27.

In my opinion these important amendments to the South African Reserve Bank Act confirm that institution’s responsibility in respect of monetary stability, and its responsibility, through the Minister of Finance, to Parliament. I trust that Parliament will be afforded the opportunity of discussing these annual reports in order to evaluate to what extent the Reserve Bank has succeeded in its task.

Clause 3(a) makes provision for the increase of the number of directors of the Reserve Bank from 12 to 14. The hon nominated member Mr Douw has already given our views on this clause. I just want to repeat that this clause provides that we, as people of colour, will also be able to serve on the board of directors of the Reserve Bank in future.

It is important that the Reserve Bank is adopting the new style of reform to get people of colour on their board. The Reserve Bank serves the South African economy and all its people and must promote the interests of all. It was with interest that we took cognisance of the Reserve Bank’s policy to employ workers from all the various population groups. The time has come for this principle to apply in respect of the composition of the board of the Reserve Bank as well and for this amendment to be the precursor to the implementation of such a policy.

The Reserve Bank has the sole right to issue all South African notes but with the transfer of the South African Mint to the Reserve Bank as from 1 September 1988, the Bill contains provisions which give the Reserve Bank the sole right to issue coins.

According to the Bill it is clear that a new series of coins is being envisaged for South Africa. The public would like to know what the new series will look like, especially because the hon the Minister of Finance indicated last year that a new R2 coin would be issued later this year to replace the present R2 note. The reason for this is economical. It sounds unbelievable that the life-span of a R2 note is approximately two months. My R2 notes last for almost three months. [Interjections.] The worst problem is that the nominal value of coins—up to the 20c piece—is lower than the cost of producing such coins. This implies that the Mint will be run at a loss until the new series of coins, including the new R2 coin, is put into circulation. When the new coins—which will basically be made of steel and which will, one hopes, be worth the R2—are issued they will inevitably become highly profitable. We should like to know from the hon the Deputy Minister how these profits are going to be dealt with—whether they are for the most part going to be distributed to the Reserve Bank and how these profits are going to be dealt with.

The Reserve Bank pays income tax like any other company, but after making provision for the transfer of the undistributed profits to various reserve funds, 90% of the balance is paid over to the Treasury, as provided for in clause 20. We should appreciate greater clarity in this regard from the hon the Deputy Minister.

From this it may be deduced that the profits from this transaction will end up in the hands of the Treasury. The hon the Deputy Minister must kindly clarify this matter as well.

Mr Chairman, once again I wish to thank the hon members for their contributions. I wish to start with the question that the hon member just asked, namely the whole matter of the profits of the South African Mint, since a very important part of this Bill deals with the Mint.

Of course the Mint is now going to pay tax. It is interesting to note that among the Bills before us today, we had two dealing with clean administration in the private sector and in the public sector. We are now dealing with the second one—a measure on privatisation or deregulation, because the Mint is actually moving away from the public sector to the Reserve Bank, and therefore it is now going to pay tax. After considering its reserves, its undistributed profits will be transferred to the Reserve Bank. The Reserve Bank in turn has its own requirements that have to be met, and then the policy is that the undistributed profits of the Reserve Bank will then be transferred to the Treasury. We hope that the Mint is going to be very profitable under this new system of privatisation, that we are going to make a huge profit and that we are at the same time still able to receive tax. As I mentioned, the take-over of the Mint is an important aspect of this Bill.

The various speakers then emphasised the aspect of the objective of the Reserve Bank which is spelt out clearly in clause 9. On the one hand we have the hon member for Pinelands who asked a question with respect to the independence of the Reserve Bank. Let me put it to the hon member like this. We have made the whole financial structure more market orientated according to the findings of the De Kock Commission. Various laws were adopted and as a result we are far more market-orientated today. We do not have platforms and so forth anymore, and we are to a far greater extent led by the market forces. As I mentioned again this morning, we are engaged in deregulation. Now I think we should stop saying that the Reserve Bank does not have any powers, or that it is being regulated by Tuynhuys. Allow me to make it very clear: The Reserve Bank and the Treasury together determine the monetary policy of South Africa. It is not the case that the Reserve Bank can pursue one policy while the Treasury can do something else on its own. We are totally interdependent. What is more, the Reserve Bank cannot pursue the monetary policy if we, from the Treasury side, do not pursue a more or less co-ordinated policy, because the Treasury cannot pursue a policy whereby it raises the deficit before borrowing to 5% or 6% of the BBP. Then the pressure on the monetary part—on the Reserve Bank—is once again almost impossible to handle. If, on the other hand, you succeed in rapidly bringing down the deficit before loans to below 3%, you make it very easy for the Reserve Bank to accommodate the monetary aspect.

The hon member for Wynberg broached a very interesting aspect. In the whole Western world at present we have Reaganomics—we do not yet know what Bush economics is going to be—as well as the Thatcher approach that we move away from the treasury and concentrate too much on the monetary—the interest rate aspect. The point is that when you have a developed economy, such as Minister Lawson at present, with his step-by-step increase of his interest rates, he does not have the problem of a large Third World component. The social security allowances ensure that people can be compensated if they become unemployed. Therefore they can control their economy with that weapon of the interest rate. I find it very interesting that the Government is criticised for the Treasury not playing its part since our state expenditure is too high. As soon as we employ the Treasury to operate on the short term, everyone is angry and they say that we must not play with taxes in the short term because the business community cannot adapt fast enough when we propose a minimum tax for example. I therefore want to tell the hon member that nobody can be independent—we are interdependent. We must cooperate in order to formulate our economic policy together.

I want to tell the hon member for Wynberg that it is a nightmare for us as well. I do not want to say that interest rate increases are our only measure at the moment. Last year we used a few other measures, for example the surcharge on imports, together with the interest rate increase, to see whether we could not control the economy more successfully. We adjusted hire purchase. However, in a country that does not have social security allowances, we shall continually have to give thought to how we can balance the two. I know that the whole idea of a platform was raised by the hon member. He pointed out what was being done in Portugal. The De Kock Commission, however, is totally opposed to this approach. We are living in a dynamic economy which has to accept the realities. I want to conclude with this on that point. We cannot rely solely on a monetary measure such as interest rates. In the short term we shall perhaps have to employ the treasury more as an instrument to deal with our economy, our money supply and the overheating in the economy.

There was an interesting debate about the board of directors and I think it should perhaps be emphasised. The hon member Mr Douw and the hon member for Western Free State mentioned that it was part and parcel of our constitutional development and that this increase in the number of members of the board of directors was intended to incorporate members of other groups as directors. I think that it is a very good development.

As young economists we were always taught that one must keep a certain percentage of gold against the issue of notes and other obligations. If I remember correctly the hon member for Rissik mentioned that Dr Gerrit de Kock—I still remember Dr M A de Kock because I am from the old school—said that an important method of controlling the economy was to hold gold against the issue of notes and other obligations. It was a “terrible shock” to me when the Reserve Bank said that that thing did not mean anything. Previously it had been my traditional religion. I hope that they will not allow the money supply to increase much faster now that there is no such thing as a control measure, but they tell me that that requirement is not necessary.

I want to conclude with this. We know that the Reserve bank plays a key role in the internal financial markets, as well as in the supervision of banks and building societies and the control of rates at which monetary quantities increase. We have a problem with the increase in the money supply, but at the same time the matter of losses which have to be dealt with by means of forward cover. If this is stopped the businessmen will finance in the interior again and then the interest rates will increase in any case. I think that this Bill brings us back to a better implementation of the responsibilities and accountancy of the Reserve Bank. I must say that we can regard our Reserve Bank as an institution with a fine history, which contributed greatly to the development of South Africa.

Mr Chairman, the Bill before this Committee is an important piece of legislation for South Africa and from the outset I want to say that my hon colleagues and I support it wholeheartedly. Before I refer to specific provisions of the Bill, however, I first want to refer to the important consequences for the economy which will inevitably result from the objectives of these provisions. In spite of the fact that South Africa is frequently considered by the outside world to be merely another African state, it is also true that the supervisory authorities over financial services in a country such as Britain have a tremendously high regard for the innovativeness and orderliness which prevails in South Africa’s financial services sector.

This proposed legislation is essential to develop orderliness in the financial markets in question and also to help the markets to develop independently. The development of independence is essential for these markets, particularly in view of the conduct and actions of certain foreign governments and institutions which will in the foreseeable future lead to South Africa being to a greater extent dependent on its own capital resources for capital formation.

South Africa will have to do everything within its power to become self-sufficient in this sphere. When I say this I am not saying that everything in South Africa is hunky-dory. I am not saying that everything is as it should be in South Africa. On the contrary, this Committee knows how my party, the LP, is striving for a new South Africa. Although the existing Stock Exchanges Control Act contains provisions regulating trading and investments such as gilts and semi-gilts, this Bill also contains certain exemptions which cause a great deal of the present trading in the said investments to take place in an informal market.

By means of the Bill before this Committee today all the trading will now be centralised in one market, which will inter alia facilitate super vision. The proposed Bill also provides that the depth and liquidity of financial markets will be improved in that all the parties involved are brought together. This in turn will result in better competition.

Another very important aspect of the so-called deferred instruments which will also be negotiated on these financial markets—I am referring here to option contracts and futures contracts— is that they will play an important part in the assets management of financial and other institutions. By making use of these instruments, an institution can so entrench its position that outside factors such as changes in interest rates will not detrimentally affect it. They also enable institutions to plan more meticulously for the future. These aspects are of great importance, particularly for institutions such as insurers, pension funds, and so on, who keep the funds of the general public in trust in order to identify future developments in the market in time and consequently take precautions to ensure that the interests of the public are protected.

If I have to refer to specific provisions of the Bill I want to single out the clause which makes provision for the appointment of a Financial Markets Advisory Board. The task of this advisory board will be to institute investigations into and make recommendations on any matters relating to financial markets and stock exchanges. With the appointment of such a board, and particularly in view of the task entrusted to it, an effort is being made to introduce supervision over all financial markets. Those who will serve on the aforesaid board will be experts in the field who must at all times act in the best interests of the markets.

I should like to avail myself of this opportunity to make an appeal to the hon the Minister to ensure that those who are appointed to members of this board must serve the overall interests in the market and that specific interest groups must not be favoured.

†Another important development in this regard is the decision to abolish the compulsory investment in prescribed assets in respect of insurers, pension funds and friendly societies, as announced by the hon the Minister in his Budget Speech. Although contained in another amending Bill, the abolition of these requirements will, to a large extent, benefit the financial markets, especially those in gilts and semi-gilts. In this regard one can think of the following: Firstly, supply and demand in the allocation of scarce capital resources can take place on market principles and thus avoid the present captive market situation through compulsory investments which normally cause interest rates to be lower than true market rates.

Secondly, a free and active market can be developed to provide liquidity and competitive prices for investment in stock of the public sector and also semi-Government institutions. Thirdly, investors such as policy-holders and pensioners who invest their savings in these institutions will benefit, as they will no longer be penalised by low interest.

*I should also like to avail myself of this opportunity in this debate to specifically thank the chairman of the House of Representatives’ component, the hon member Mr Douw, for the guidance he has given that committee during the past two years. We support this Bill.

Mr Chairman, before I discuss this Bill in detail I want to refer to two remarks that were made earlier today. In the first place one of the hon members quoted from the Word. In the second place the hon the Deputy Minister of Finance referred a moment ago to the Mint: He hoped that the Mint would do very well and would make a great deal of money, so that a great deal of taxation could be collected!

If one combines these two situations I should, with all due respect, like to quote from Proverbs chapter 29, verse 4:

The Financial Markets Control Bill was thrashed out very, very thoroughly by the Jacobs Commission and the Stals Commission. They spent a great deal of time on it. A very bulky and comprehensive Bill was subsequently published, and I do not really think we need say very much more about it. What there is is important to us in this respect that the name of this Bill testifies to the need for it, namely the control of financial markets.

What is important here is the development of the smaller markets, which are now being afforded an opportunity to develop and to do business without 30 persons having to apply for such a certificate and without such persons having to qualify for listing on the Johannesburg Stock Exchange under the Stock Exchanges Control Act of 1985. This Bill is important in this respect that very important clauses have been included in which provision is being made for a financial markets advisory board, and also for the registrar, the financial market licence and the withdrawal of such licence, the juristic personality of the society, etc.

The rules of the financial exchange are set out very comprehensively and I am not going to repeat them. For me it is important simply to quote the following to hon members, and I am quoting from clause 17, on page 16 of the Financial Markets Control Bill:

In clause 20 false trading and manipulation are addressed. It is precisely under the present circumstances that this has become essential. The clause on actions for damages is also essential. As I have already said, this Bill has already been thrashed out. We therefore support it.

Mr Chairman, there is a dictum which says that half a loaf is better than no bread. In accordance with that I support the Bill, although I am not absolutely satisfied with it. It is common knowledge that people are swindled and taken for a ride by various financial institutions and markets. This Bill partly takes care of that problem.

I want to thank the hon member for Delmas because he did all my work for me. He commented on all the clauses I was going to comment on, so I will not waste the House’s time on those matters.

Nevertheless, I would like to draw the hon the Minister’s attention to the fact that the net is big enough to hold all the fish but there are large holes through which the sharks can escape. So I would advise the hon the Minister to introduce further legislation next year containing stricter control so that all the fish and all the sharks can be kept in the net. Then we will have better control over the financial market.

I support the Bill.

Mr Chairman, I would like to thank the hon member for Camperdown for his support for the Bill. I was not quite sure, however, whether he wanted the sharks inside or outside the net. [Interjections.]

*I should also like to thank the hon members for Diamant and Delmas for their support for the Bill.

†Mr Chairman, this Bill emanates from the recommendations of the two committees under the chairmanship of Dr Stals and Dr Jacobs which were appointed to investigate the development of financial futures transactions in South Africa and the South African market for gilts respectively.

This Bill is in fact enabling legislation to provide for the regulation of the futures market, which has come to be known, I believe, as Safex, the South African Futures Exchange. It provides for structuring the market, creating an advisory committee to advise the Government on the road ahead and a registrar of financial instruments.

The rules and regulations of this instrument market are analogous to legislation in the United Kingdom and the United States. To a large extent self-regulation will be the name of the game, and the problem is to create a formalised framework within which the market in financial futures can evolve and take its natural course.

Futures markets for agricultural produce developed in the United States in the last century. This market provided for the creation and transfer of instruments used by operators in the spot markets to hedge their exposure from the risk of possible changes in prices. Farmers operating in an uncertain market are exposed to the dangers of declining prices in the period before they can market their products. Similarly, users of agricultural products are exposed to increases in the prices of these products before they are able to finance their purchase transactions. Futures markets therefore provide the means of hedging these price exposures.

The concept of financial futures developed in anticipation of the cessation of the Breton-woods Agreement resulting in the termination of the regime of fixed exchange rate parities between the major currencies. The Chicago Mercantile Exchange sensed that the proven techniques of futures trading of commodities could also be applied to financial instruments.

In the environment of floating exchange rates the International Monetary Market was established in 1972. As a result of the increase in volatility in interest rates, the need for interest rate future contracts was established in 1975. The growth in activity on financial futures markets has been spurred by the need for meticulous financial management in times of economic uncertainty.

Financial futures markets thus provide a mechanism for market discovery as well as for hedging. Currency and interest rate futures were the main elements of financial futures markets in the seventies. Further in the eighties other types of contracts have gained in importance. Stock index future contracts and trade option contracts have gained in popularity. The United States has adopted an umbrella approach towards commodity and financial futures, which are often found side by side on the same exchange under one roof. This provides a roving pool of liquidity as traders can move from one pit to the next to follow the action.

The main question which emanates from this legislation is whether the market should be more or less carefully regulated.

The Stals Committee looked at three possibilities, namely the no-intervention approach; the ideal-structure approach and the minimumintervention approach. They eventually recommended the minimum-intervention approach and are looking to create a formalised framework within which the market in financial futures can evolve and take its natural course. I believe that we cannot be too conservative when spelling out the rules of the game. We will have not only our own home-grown fraudsters to cope with, but also the financial market equivalent of the Uhuru-hopper who will be arriving from the sophisticated environment of Europe and America, well-schooled in all the arts of manipulative abuse.

South Africans are notorious for their naivety and susceptibility in falling for con-tricks. I believe that we should be very careful to prevent the credibility of this infant futures market being destroyed in the eyes of the public, by sharpshooters.

It must be accepted that a certain amount of speculation and ease of entry are essential to generate the liquidity needed in developing a futures market. Supervision must therefore find a balance between, on one hand, regulations that are so harsh as to impede development and, on the other hand, ones which are so loose as to not limit spurious activities by participants.

In the UK the original philosophy was one of self-regulation which more often than not regulated procedures between participants inter se, and was not always effective in protecting the consumer. As the market developed it was found—to quote Arthur Seldon—that “the sheer increase in the number of participants meant that moral persuasion, raised eyebrows, stern rebuffs over drinks and the prospect of a cold shoulder became rather unimpressive and slightly ridiculous methods of regulating thrusting financial institutions”. I therefore believe that we are correct in taking a conservative line and by trying to obviate the risks of allowing fraudulent behaviour to get off the ground.

An interesting aspect of financial futures markets is that they have a vocabulary all of their own. We have terms like puts, strike rates, naked options, scalpers, collars, spreaders, straddlers, long-hedgers and so forth. I have always been fascinated in reading of futures in “orange juice” and “pork bellies”. I believe that a challenge awaits the creative thinkers of the Afrikaans language to provide adequate words for these terms.

It is my pleasure to support this piece of legislation.

Mr Chairman, in following on the hon member for Wynberg I would like to congratulate him on what was a very interesting description of the futures market. As he so well illustrated—certainly made his point—we are dealing with what is a very sophisticated financial instrument. We wholeheartedly support the way this legislation has been framed, in the words of the hon member for Wynberg, in rather conservative terms, in the very necessary interest of protecting investors.

It is understandable that there is an urgency in introducing this legislation as the markets in both futures and gilts already exist and it is vital that the necessary controls be implemented to protect consumer interests.

Fortunes have been lost on the stock exchange and no-one is spared, but the vulnerability of the unsophisticated investor is indisputable. In an uncontrolled market unscrupulous operators will be quick to exploit the unwary. This Bill has therefore been introduced to protect the investor whilst also setting the rules for financial instrument traders. This is clearly in their interests as well. That this Bill therefore meets an urgent need is undoubted. However, our real concern is whether the controls are tight enough. I believe that this reflects fairly the opinion that was held by many on the Joint Committee on Finance who were concerned about the extent to which unscrupulous dealers can be controlled.

We do, however, accept that legislation can never be watertight and there will be those dealers who ferret out ways of circumventing the rules in order to make more money. While we therefore accept this Bill as providing controls where few existed before, we stress the need for constant vigilance. We were given the assurance by Treasury officials that this will be done.

We welcome the growth and development of new financial markets following well-established trends elsewhere in the world. We support this Bill as being a serious attempt to control these markets and protect the investor. We believe this will enable a healthy market to develop in the interests of the industry. Our only concern is that the controls may well prove not to have been extensive enough.

With these words of caution we support the Bill.

Mr Chairman, I thank the hon member for Pinelands for his support of this measure. Due to my reduced time, I shall have to make haste.

This Bill is a result of recommendations made by two committees under the chairmanship of Dr Stals and Dr Jacobs, that were appointed to investigate the development of financial futures transactions, inter alia futures contracts and option contracts in South Africa, and the South African market for gilts, respectively.

In South Africa the Johannesburg Stock Exchange for some years provided an active public market in gilts, operating on their traditional open outcry system on a separate trading floor in the Stock Exchange building. In order to cater for the developing gilts market and for the market in derivative instruments and other financial instruments, the JSE committed itself in 1987 to extending its physical facilities. The occupation of the new annexe building in Kerk Street, Johannesburg should take place shortly. This indicates a commitment to the future by the JSE which is essential if the nation is to be served by an efficient and secure national stock market. It is interesting that the very responsible JSE has recently suspended dealings in the new Ellis Park shares because of an unprecedented rise in equity values prompted, it seems, by insider knowledge. The chairman of Ellis Park, Dr Louis Luyt, has suggested that he should have been approached or consulted first. He does not seem to have heard about independence, democracy or corruption.

I want to get back to the gilts market. The JSE is one of several markets for gilts in South Africa. The traditional market has been a private treaty market between the major investors but in recent years this has been supplemented by the JSE open outcry market and even more recently by the development of a screen market, operated substantially by capital-based intermediaries, such as the merchant banks. The development of trading in gilts in South Africa has become an evolutionary process and has given rise to a number of effective and complementary markets which blend together to give a relevant and sound set of options to the participants.

There has been a serious deficiency in the gilts market in the phases beyond trading. I think that this is what this Bill is about. These phases are basically those of surveillance, clearing and settlements. At the JSE they have surveyed and cleared for their brokers through the mechanisms of the Inspectorate and their Gilt Clearing House but with two important exceptions. The overall clearing and settlement function has been missing, as has the overall surveillance function of the total market. This is certainly a glaring weakness in the control of our financial markets.

Attempts in the past by the JSE and the Clearing Bankers Association to get together to establish a modern settlement system have been bedevilled with problems. These bodies came to the realisation, together with numerous participants in the gilts market, that the market probably needed an independently owned and managed central administrative agency to act as the focal point for surveillance, clearing and settlements. The realisation, it seems, was overtaken by welcome developments on the part of the authorities with the appointment of an investigating committee chaired by Dr A S Jacobs, senior Deputy-Governor of the Reserve Bank to report on the future nature and structure of the gilts market in South Africa.

The JSE made clear inputs to this committee, as did other major participants in the gilts market. In due course a report was given to the hon the Minister of Finance and the result, together with the input of the Stals committee, is in the Bill before us. The JSE and other interested parties have welcomed the provisions of this Bill and there have been no adverse comments.

Further, to control and regulate the markets under discussion the Bill provides for a Registrar of Financial Markets to perform certain statutory functions, a Financial Markets Advisory Board, the licensing of financial markets, and an appeal board to adjudicate disputes in a prompt and inexpensive way.

The Stock Exchanges Control Act provides that 30 or more persons may apply for a certificate authorising the issue of a stock exchange licence and the provisions as amended give the Registrar discretionary power to consider applications for fewer than 30 persons. This will understandably give encouragement to the development of smaller markets in shares where participants do not qualify for listing on the JSE. What is important is that these markets will still be subject to the provisions of the Stock Exchanges Control Act.

It is worth noting some detail of the listings boom in 1987-88, although it is not really connected with this issue. There were more than 200 new listings, representing an increase in the lists of nearly 40%. The fact that approximately 40% of the new listings were in the highly successful capital development market was also an important feature. [Time expired.]

Mr Chairman, I should like to speak in support of the Financial Markets Control Bill. I should like to concentrate on the protection granted to John Citizen by the Bill. The Bill covers areas which are very strange to us, and also contains a high degree of exposure to risk. Precisely because of this I am pleased to see that the Bill contains several provisions that are aimed at consumer protection.

Allow me in the first place to refer to the application for the issue of a licence to establish a financial exchange. In order to be licensed as a financial exchange the applicant must satisfy the Registrar of Financial Market that—

1. (1) He has sufficient financial resources at his disposal;
2. (2) the proposed rules comply with the requirements of the Act;
3. (3) the interests of the public will be served by the issue of the licence; and
4. (4) there will be sufficient independence and competition.

The abovementioned licence is issued for a year only and must subsequently be renewed annually. The Registrar may only renew such licence if, inter alia, he is satisfied that the rules of the exchange had been properly enforced and that the renewal will serve the interests of the public. Similarly clause 11 provides that the Registrar may suspend or cancel the licence of a financial exchange if he is satisfied that the exchange has failed to comply with certain provisions of the Bill and that such failure has resulted in prejudice to the interests of the public. The rules for a financial exchange will govern the activities of the exchange, its members and its clients.

I should like to elaborate on that. As hon members have already heard, the rules must be drawn up to the satisfaction of the Registrar. The following, which are aimed at the protection of the interests of all parties, can be singled out. I should like to illustrate two points. Provision shall be made for the way in which and conditions under which members of such an exchange may carry on business in order to ensure honesty and fair practice. It is provided that the person who is not of good character and high integrity shall not be admitted as a member of the Exchange. It must also be possible to prescribe certain standards of training and experience. These two points tell us clearly that the persons who apply for these licences must be persons of integrity and character.

Clause 3 makes provision for the appointment of a financial markets advisory board that may institute investigations into and make recommendations on financial markets and stock exchanges. It will be the highest priority of this board to direct its investigations and recommendations to the realisation of the public interest.

Clauses 20 to 23 contain important provisions to prevent prices and financial instruments from being manipulated by the dissemination of information or the concealing of material information at his disposal.

Clause 20 prohibits the creation of a false or misleading appearance of active carrying on of business, participating in a transaction to create artificial prices, and the inflating or depressing of prices by means of a fictitious or artificial transaction or plan.

Clause 21 provides that no person shall make a statement or disseminate information which he knows, or ought reasonably to know, to be false or misleading and to be likely to induce other persons to deal in financial instruments, or influence the prices of such instruments.

Clause 22 prohibits any person from inducing another person to deal in a financial instrument by making or publishing any statement, promise or forecast which he knows to be misleading, false or deceptive, or by the concealing of material information at his disposal.

Clause 23 provides that any person who contravenes or fails to comply with any rule of a financial exchange, or who contravenes any of the provisions of the three clauses I have just mentioned, shall be liable for any loss or damages suffered by that person as a result of such a contravention.

Mr Chairman, I wish to thank hon members who took part in the discussion of the Bill before us. I believe it is another milestone in the history of the development of the South African financial markets. It is also a very interesting development—the hon member for Wynberg mentioned this—that this legislation authorises the industry to follow a system of self-regulation. As mentioned, we have to give it a chance. It was tried out in the UK and also the USA. The Government believes that the best approach is to have self-regulation and not to have the Government always intervening in the activities of the market. *Quite a number of arguments in regard to the protection of the consumer were advanced. In my opinion this matter should receive more attention. The hon member for Pinelands and other hon members also mentioned this. Yet exceptional protection for the consumer is an integral part of this Bill. The hon member for Camperdown also mentioned the problem of the protection of the consumer.

Clause 17 is very important in regard to protection, because the exchange can only be licensed if it is in the public interest. The financial status, expertise and integrity which brokers must have are prescribed and applications are considered accordingly. The Bill makes provision for measures to ensure the delivery of financial instruments and the payment of the instruments, it makes provision for a fidelity fund, supplemented by insurance to support delivery and payment, for the keeping of adequate records—I have already mentioned previously how important it is that brokers’ records of transactions on the exchange should be kept in readiness for auditing.

Clause 2(4) makes provision for the right of appeal to the Minister against any decision of the Registrar. Clause 18 makes provision for the right of appeal to an appeal board against the decision of any financial exchange by an aggrieved person.

The problem of market manipulation and actions for damages are also very important. Clauses 20 and 30 contain important provisions to prevent price manipulation of financial instruments taking place by the dissemination of false information or the concealment of material information. The aspect of supervision is dealt with thoroughly, and we expect that the Registrar will attend many of the meetings of the executive committee and will also play a part in any activities.

The question of unsolicited invitations was also mentioned by certain hon members. When a person comes to one’s door and makes a sharp sale, clause 25 affords the person five days to demand his money back if he no longer wishes to conclude the contract. We can all remember buying things and saying to ourselves, as we walked out, that we had made fools of ourselves. These are new exchanges and complicated instruments and the intention is that uninformed persons should not, as a result of being misled, find themselves involved in transactions if they have not been properly informed about them. Clause 3 deals with the advisory board, and an interesting aspect of this board is that we have two laws regulating the financial markets and stock exchange in South Africa. The advisory board is there so that all of us together can look after the important collective interests. I think this is a very interesting development, in that we are preventing too much fragmentation by allowing everyone to carry on in his own way.

Another important clause is clause 40. It has been said, and I know it was previously mentioned that perhaps the Registrar has too many powers, but since we are dealing with a new facet of self-regulation here, matters must surely be administered to a certain extent. Here the Registrar also has the possibility of exemption and adjustments, because we must see this Bill before us as a very important first step. We must accept that as these markets develop we are going to encounter problems, and that we shall have to come back and make adjustments. In the meantime we are making it possible for the Registrar to make those adjustments. I am looking forward very much indeed to this development. I do hope, now that the Futures Market in Chicago has written off gold for such a long time, that everyone will not begin to believe that gold no longer has any possibilities. We hope that in this futures market that we are going to develop here, gold has a future again, so that we can again develop more of a positive feeling about growth in South Africa.

Mr Chairman, we are not actually dealing with a new Bill. We are dealing here only with the consolidation of Section 6 of the Finance Act of 1978 because, as we put in our motivation, if this is included with the Finance Act we will have to wait until nearly the end of this session. By including it in the Financial Institutions Amendment Act it is providing more flexibility to deal with Sasria and their activities.

Mr Chairman, I gladly support the Reinsurance of Material Damage and Losses Bill. This Bill is to consolidate the laws empowering the Minister of Finance to enter into agreements with insurers binding the Government to compensate insurers in respect of certain losses or damage to property; and to provide for incidental matters. We on this side of the House of Representatives support the Bill.

Mr Chairman, before I talk about this I wish to speak in a lighter vein, if I may. The hon member for Wynberg said that there are certain words in the vocabulary of the stock exchange for which we do not have the equivalent in Afrikaans. I want to ask him to request them in the first place to provide me with English words for “ja-nee” and in the second place for “die kat loop onder die tafel deur,” and, in the third place for “kaboemielies”. [Interjections.]

The Reinsurance of Material Damage and Losses Bill is a very serious Bill and because it is as the hon the Deputy Minister explained it, we support fully that which is requested in the Bill because it is in the interests of our people and our country in the present circumstances in South Africa and in that of the states previously adjacent to South Africa or which were under the authority of the Government of South Africa. We gladly support the Bill.

Mr Chairman, this Bill consolidates five Acts that empower the hon the Minister of Finance to enter into agreements with insurers binding the Government to compensate insurers in respect of certain losses or damage to properties. The Bill also repeals section 6 of the Finance Act, 1978 (Act 94 of 1978), section 16 of the Finance Act, 1984 (Act 113 of 1984), section 18 of the Finance Act, 1986 (Act 77 of 1986), and section 18 of the Financial Institutions Amendment Act, 1987 (Act 6 of 1987). It also repeals the whole of the Finance Amendment Act, 1989 (Act 45 of 1989). This Bill is absolutely necessary for administrative purposes. For administrative purposes, to have to refer from Bill to Bill and from Act to Act is a terrible nuisance.

However, I want to raise a very important issue here. Why is it necessary to add a Government reinsurance policy? To the best of my knowledge, South Africa is the only country where the Government carries insurance business. Perhaps the hon the Minister can correct me when he rises to reply, but nowhere else in the world does the Government provide insurance. Lloyds in London does this, but they are a private company. Lloyds are also in South Africa, but the million-dollar question is: “Why?”. I know why—all of us know why. What sort of damage and losses are being reinsured by this Act, which empowers the hon the Minister to reinsure? They are losses due to acts emanating from political unrest and riots. What causes political unrest and riots in this country? It is the fact that for the past 41 years we in this country have been saddled with a Government bent on dogmatic ideologies.

Order! The hon member must not follow that line too far. The hon member may proceed.

I am not addressing the symptomatic remedy for the situation; I am dealing with the root cause. I think this is germane to the Bill. The root cause of the need and desirability of the existence of a reinsurance policy lies in our political problems.

Leaving aside the parties involved, if we remedy the causes from which the need and desirability emanate to have such provision made on our Statute Book for reinsurance, then we have solved our problem. We will be saving the taxpayer money. This reinsurance is not gratis and free of charge. We do not know what it is costing; it is a hidden factor. I do not know how many millions of rand or how many cents are being paid in premiums as a guarantee to insurers who insure private property. Therein lies my concern.

I serve on the finance committee. It is my bounden duty to protect the interests of the taxpayers of the country. After all, there is an old adage which says that it is a little hole that sinks the biggest ship. Therefore, if we allow R10 million here and R5 million there—it makes no difference—then ultimately we are wasting billions of the taxpayer’s money. One day we will find that we are bankrupt.

This is my country, right or wrong. Where she is right I will let her be right, but it is my bounden duty as a son of this country to put her right wherever she might be wrong. I think one of the things that is wrong here is what causes the situation that compels us to enact legislation of this nature.

It is just a consolidation measure.

I agree that this is a very important consolidation of various laws. My argument is that, following this, we must take the remedial steps necessary to abolish this thing totally so that there will be no need for this type of insurance. I support this Bill.

Mr Chairman, I received a note and I wish in the first place to respond to the hon member for Delmas. In this note I am told that the translation for “ja-nee” is “Jani van Paardekraal”. [Interjections.]

I also wish to respond to the hon member for Camperdown who said that the money of the taxpayer was involved with Sasria. It may sound like it, but the hon member will know that these Acts that are being consolidated today, have been in the Statute Book since 1978. It is purely to insure the policy holder in South Africa against these insurance companies who no longer wish to insure the policy holder in this country against that to which the hon member referred. In order to reinsure them, the State placed these Acts in the Statute Book, thereby supporting the insurance in respect of damage to property so that the policy holder will not be affected negatively. I also wish to assure the hon member that since 1978 not a cent of the taxpayer’s money has been used to provide the necessary support to insurers. It is purely a protective measure which is to the advantage of the policy holder.

It is Friday afternoon, and a long week-end, and everyone is in a hurry. I think we are in fair accord that we should dispose of this legislation. I have pleasure supporting this legislation for the ruling party.

Mr Chairman, I would like to follow the excellent example of the previous speaker and just say that this Bill consolidates existing laws and we have pleasure in supporting it.

Mr Chairman, I have been set such a good example that I suppose I may not talk too long either. Hon members spoke so fast that I put it to myself that I would have to be able to leave at 15h45, otherwise I would not be in time to catch my aeroplane, but hon members have now granted me 15 minutes to speak. I wish to say to the hon member for Camperdown—the hon member is not here now—that the insurance of political risk is nothing new.

†There is a political risk in exporting and we insure our exports against this political risk. That is a common way of promoting exports. There is nothing new in having insurance against political risks. If the hon member is a member of the finance committee he will remember that we had long discussions about riots at soccer matches eg at Ellis Park. That is also, according to my knowledge, part of this risk that can be covered. I assume that the hon member does not play soccer, so he would not classify that as a political risk.

*As I put it in the beginning, this is a consolidation and basically nothing new is included. I wish to thank hon members for the brief and concise speeches. It has been a long day and I think we have had an especially positive and constructive discussion here. If I were to summarise, I would say I think the Bill on the Auditor-General dealt with clean government and clean administration. We also dealt with better control in the case of insurance companies, clean administration in the private sector, privatisation and deregulation. I hope that we can continue in this manner with legislation to promote clean administration in South Africa and also, wherever we can, to introduce further deregulation. I wish to thank hon members for their co-operation.