Mr Chairman, I move without notice:

Agreed to.

Mr Chairman, with reference to the debate, and particularly to the observations made by the hon member for Umhlanga, I think it appropriate to discuss for a while the question of development planning as a preface to this afternoon’s debate. The Government realises only too well that constitutional development in this country cannot really come into its own if it is not based on a sound national economy. In fact, greater progress in the constitutional sphere is made possible from a position of economic strength. What we are concerned with here is not merely the question of economic growth, but at the same time the substance of that growth in terms of the benefits it has for the country and the entire population.

Owing to the particular structure and distribution of our population and the availability and distribution of natural resources, a more even geographic distribution of economic activities in which all economic sectors ought to be involved and in which each region of our country is developed to its full potential is of cardinal importance to continued growth and progress. It is well-known that the Government endorses the principles of a market-oriented economic system to create a favourable development climate for optimum participation in the economic processes in the private sector.

However this requires thorough policy planning on the part of the State and expert management of our national economy to ensure that we will achieve the best possible results. The successes which the Government has already achieved in this connection are establishing firm foundations on which a new South Africa can now be developed further. In this way for example the Government’s policy in respect of the promotion of a more balanced regional development policy has burgeoned since 1982 into a multilateral economic community for Southern African states.

In its ongoing monitoring of policy the Government has also subjected the regional industrial development policy to independent evaluation by a panel of experts. The findings and recommendations of this investigation are at present being considered multilaterally by the participating countries.

One of the most important findings, to which I must refer, is that an economic rationale does exist for regional development. This finding is in accordance with the Government’s standpoint which has over the years been contained in policies and programmes, and still is.

It ought now to be accepted by everyone, including the critics of the Government, that a policy of regional development under Southern African circumstances is essential and justified. Besides, South Africa as the senior partner in this inter-state programme has an important responsibility to play a leading role in the development process in Southern Africa. Development does indeed contribute to the stabilisation of communities, but conversely a lack of development can also contribute to the destabilisation of communities. It is consequently in the interests of Southern Africa that all of us should co-operate to make a great success of this programme.

Through this initiative, and specifically by means of the regional development programme, more than 181 000 direct job opportunities were created in 3 350 industries with an investment of approximately R3,3 billion in the Republic of South Africa and the self-governing territories since April 1982.

Sharp criticism of the supposed scattered effect of the policy as a result of the large number of development points that have been designated for industrial development is received by the department and the Government from time to time. An analysis of the above results indicates, however, that the 10 most popular development points have attracted approximately 55% to 60% of all regional industrial development.

While the Government accepts that concentrated regional industrial development should be pursued as an objective with a view to rural urbanisation and for the advantage of utilising the proliferating effect as quickly as possible, the objective of the policy is to a large extent already being anticipated in the present programme.

Another matter which sometimes elicits criticism is that the present policy is aimed too extensively at industrial development. Now I want to emphasise at once that the Government has always accepted that all sectors of the economy must participate and be involved in regional development. In fact, this was announced in 1982.

Before any fundamental adjustments are made to the existing policy all the elements of the programme must first be worked out and must be in place. In this connection I am referring specifically to agriculture, mining, tourism, small businesses and so on. Efficiency, effectiveness and affordability are considerations which must apply in this process.

I want to reassure existing and prospective regional developers and regional industrialists that they will not be left in the lurch by the Government as a result of unreasonable or overhasty adjustments to the programmes, If and when these are made, it will be done with the greatest circumspection.

†I would hasten to assure industrialists that they may confidently continue to obey their investment decisions on economic considerations and within the guidelines of the present programme. The Government consequently recognizes its responsibility in this regard. Inevitably the Government must continually consider the regional development policy and programmes in terms of their efficacy as well as in respect of their contributions to other objectives set for development.

The Government naturally needs a properly integrated planning and analytic system or an ability for this purpose and also to ensure that all sectors are equally and thoroughly considered in terms of their inherent development potential for our country. The Government aims at a position where it will be possible to test the policy initiatives at a national level on the basis of their possible influence on regional development. The Government consequently needs an ability to test policy actions on the basis of their implications on regional development. As far as possible the Government does not want to be accused that particular regions are placed in a weaker position to compete for their legitimate share of national development as a result of any Government action.

In an effort to solve these problems the Government some time ago instructed the Department of Development Planning to draft a National Regional Development Programme for the regions. Hon members will recall that the Economic Committee of the President’s Council in its investigation into a strategy for job creation recommended that regional development programmes and strategies should be developed for this specific purpose. It gives me pleasure to announce that notwithstanding the serious shortage of expert personnel the department has made good progress with the drafting of this programme. The first preliminary results are being evaluated at present and it is envisaged that they will soon be tested interdepartmentally and in regional context. We will quite obviously have to rely quite heavily on the regional development advisory committees for advice in this regard.

I would also like to mention that the department has just made a comprehensive data information system available to the regional advisory committees to enable them to base their research and analyses on a firm foundation. I would like to reiterate that the public at large, especially in the private sector, should not regard the National Regional Development Programme as an effort to centralise control; on the contrary, the availability of clearly defined policy guidelines in the development field should bring more certainty to the private sector in respect of investment opportunities and for taking their decisions. The Government is also not deviating from its stated policy to consult extensively with the private sector beforehand. I am convinced that as far as establishing and developing the necessary technical skills to launch such a development programme are concerned South Africa is the leader in this field.

In his address at the opening of Parliament in 1986 the hon the State President asked the department to initiate the establishment of a programme addressing the problem of poverty more effectively. I believe that the launching of a National Regional Development Programme together with other important initiatives in this regard is an important contribution to this end. However, the conclusion should not be drawn that spatial development has up till now taken place without purpose and without guidance by Government; on the contrary, the development strategies for specific areas are developed in close co-operation with the local authorities, regional governments and regional development advisory committees and agents. Existing strategies are regularly revised and adapted to new circumstances and needs. The Development Strategy for the PWV Complex and the guide plan actions for its various sub-regions as well as that for the Cape Metropolitan Area and the Greater East London Area are striking examples. The drafting of an overall development framework for the Durban Functional Region will soon commence. The Government has, therefore, time and again initiated certain actions in the development planning field in view of progress towards achieving the long-term objectives.

Another case in point is the White Paper on Urbanization which was published in 1986 after extensive consultations. The urbanization policy of the Government as set out in the White Paper of that year directed orderly urbanization with a clear vision and at the same time ensured new economic opportunities and steady growth in the urban areas.

*Since 1986 45 000 ha of land has already been identified, systematically and pro-actively, for the urban development of Black communities. Almost overnight a new development orientation helped to replace the former unrest that existed, while the principle of affordable informal housing on an orderly and permanent basis has already helped a great deal to get poor people settled. At the same time the Government has passed legislation to ensure effective control of illegal squatting, which must not be confused with informal housing.

Besides urbanisation which is taking place in the metropoles, urbanisation is also taking place in scores of medium-sized cities, and also in every town and every rural area. This process is continuing everywhere in an orderly way and special attention is being devoted to the development of viable local authorities.

The Co-ordinating Council for Local Authority Affairs is also giving ongoing attention to the problems of rapid urbanisation. The council is at present giving attention inter alia to the consideration of differentiated norms and standards, alternative systems of taxation and even the possibility of formulae for the distribution of income among local authorities. Naturally urbanisation is accompanied by complicated and almost insurmountable development problems.

Obviously, too, the Government cannot deal with or organise the process of urbanisation on its own. In this connection I should like to convey my thanks to all three Houses of Parliament, and the provincial governments, for their contribution in dealing with this challenge in a responsible way. In particular I should like to refer to the part played by the private sector during the past seven years in helping the Government build a new future so successfully, and also specifically to their contribution in addressing the housing problems of this country.

The private sector investment in new industries is characterised by its support for regional industrial establishment and is also reflected in the way in which the overall picture and the quality of life has changed and been enhanced in so many of our country’s lower income groups and communities.

Unfortunately the concept exists that South Africa, relatively speaking, has unlimited land available for the establishment of towns and that everyone who becomes urbanised can be provided with a site and services. Within a meaningful and economic urban structure, well-situated land is becoming an ever scarcer and more expensive component of development. Other considerations must also be taken into account, such as mass transportation systems, bulk services, affordability and job opportunities.

Inevitably the traditional standards will no longer be as attainable and very high density will quite simply have to become the town planning norm for the vast majority of our population. The Department of Development Planning therefore has a newer, greater and higher assignment, namely to interpret the essence of a new South Africa in inspiring overall policy formulation in the sphere of planning. Planning guidelines on national and regional level will have to be interpreted and tested in order to identify productivity projects within regional development strategies and/or programmes.

I think the purposeful, integrated and co-ordinated driving force of all the participating countries’ development agents and agencies can best be mobilised in this proven and orderly way. Policy, planning, methodology and model have all been provided and are all in step. The Government has established this foundation. In this way it has created an inspiring prospect, and won the trust of Southern Africa and the support of its people.

†I would now like to refer to the Group Areas Act and other related Acts. The process of evolution in any country or region should be supported by clearly defined policy and purposeful planning in order to ensure orderly and sustained development. As a result of the particular composition and character of our population such overall guide-lines are even more necessary today. It is the function of the Department of Development Planning to formulate these guidelines.

In accordance with the spirit and provisions of the Constitution the various Ministers’ Councils are charged with the functions and responsibilities in respect of the planning of own communities.

However, to bring about the necessary coordination, it is now necessary to allocate the general overall functions in respect of broader housing matters to a single Government department. The Department of Public Works and Land Affairs is already overall responsible for general housing matters as well as for particular functions in respect of land affairs.

In view of this it was decided to transfer the functions and responsibilities presently administered by the Department of Development Planning in respect of the Group Areas Act, 1966, the Reservation of Separate Amenities Act, 1953, and the Free Settlement Areas Act, 1988, to the Department of Public Works and Land Affairs. The expertise of the Department of Public Works and Land Affairs in the field of housing will be valuable in dealing with problem cases which might result from the application of the said Acts.

In future it will be ensured that reported cases are handled with compassion when offenders of the Group Areas Act are dealt with, especially when the eviction of persons may be considered. The individual needs of the persons concerned will as far as possible be considered, and attempts will be made to offer them suitable and acceptable alternative accommodation.

It was therefore decided to make provision in the Department of Public Works and Land Affairs for a component which can render such housing assistance. The responsibility for exercising control of permits was offered to the three respective own affairs administrations in view of the fact that the planning of the respective communities is the responsibility of the various Ministers’ Councils. The Administration: House of Assembly has already indicated that they will accept this responsibility, which presently rests with the provincial administrations, in respect of the areas for which they are responsible.

The responsibility for formulating planning and development policies remains the function of the Department of Development Planning. A task group under the guidance of the Commission for Administration has been appointed to attend to the necessary adjustments in the organisation and staff establishment in co-operation with the parties concerned.

Various hon members referred to the question of local government. I refer in particular to the hon the Minister of Housing and the hon the Minister of Local Government and Agriculture in the House of Delegates, the hon the Deputy Minister of the Budget in the House of Representatives, the hon the Deputy Minister of Population Development and the hon members for Border, Stanger and Reigerpark as well as other hon members who referred to the position of management committees and local affairs committees.

The hon the Minister of Housing in the House of Delegates specifically referred to the position of Prospecton which is part of the industrial area of Amanzimtoti. He asked whether allowing Isipingo to share in the taxes generated in this particular industrial area could be considered. I have taken note of what the hon the Minister said in this regard and wish to associate myself with the proposal that the principle of sharing income resources should be examined. The Co-ordinating Council for Local Government has in fact decided to fully investigate this particular issue. I refer hon members to the following on page 5 of the annual report of the Co-ordinating Council for Local Government in this regard:

• —the demarcation of the area of jurisdiction of each local government body so that it forms an economically viable unit;
• —a formula for the distribution of sources of income among local government bodies; and
• —the allocation of resources generated in central business districts and industrial areas.

It must be emphasized that the regulations regarding the criteria for the determination of the viability of local authorities were promulgated in 1985. In accordance with these regulations viability is the main criterion for the establishment of local authorities for all the communities. In cases where communities comply with these criteria the establishment of local government institutions should not be opposed for dogmatic reasons.

Non-viable communities should be accommodated in a different manner. I have suggested as a possible way of doing this that we consider a model of a mini-RSC. This would have the effect that all communities within a town or city would be represented, but no group would be in a position to dominate another. I am sure that we will be able to negotiate acceptable and workable solutions based on these suggestions.

I agree with hon members that the system of local government should be investigated. The Co-ordinating Council decided on 30 October 1986 that an investigation be launched in this regard. The committee responsible for these investigations consists of representatives of all the municipal associations and institutions.

This investigation covers all aspects of local government in detail. One of the points of departure of the committee is that the diversity of the South African society must be honoured in their investigations and findings. Therefore, no rigid system is envisaged. Provision will be made for local authorities to adapt the system to meet their needs within a broad framework as laid down in terms of the law.

*The hon members for Heilbron and Smithfield referred to regional services councils. As regards the establishment of regional services councils in the Free State, I should like to point out that the Administrator of the Free State has already reacted to the report of the Delimitation Board. Another four regional services councils will subsequently be established this year in the Free State, and five regional services councils will then cover the entire geographic area of the Free State. The hon member for Heilbron referred to rural councils and the representations made by the Free State Agricultural Union for more rural council representatives on the regional services councils.

The important point we must take into consideration here is that the number of representatives on regional services councils are not of such great importance. Every participating member, regardless of how large or small his voting capacity is, is protected by mechanisms within the Act. The representation therefore places emphasis on the quality rather than the quantity of representatives.

The hon member for Smithfield referred specifically to the possibility of applying elements of the RSC model, such as protection of minority rights and non-domination of one participant by another, to other levels of government as well. In this specific connection I agree with the hon member.

The hon member for Ermelo alleged that Black town councils were participating in the regional services councils because a guarantee for funds for them had been written into the Act. That of course is not correct. The Act refers to handicapped areas, regardless of race. In this way, for example, the CP town councils of Brits and Akasia agreed with the approval of the budget of the Pretoria RSC. This year Brits is to receive R4 million and Akasia R3,6 million from this regional services council. This is in in answer to CP criticism that White town councils are not benefiting from regional services councils.

In the area of jurisdiction of Mamelodi—I could give the hon member the figures if he wants them—the regional services council is spending R15,1 million this year, and in Atteridgeville, R13,9 million. I want to emphasise that there was consensus on this spending because the CP members voted for the appropriation of funds for these areas.

In the time remaining I shall try to refer rapidly to other hon members. Those to whom I am not able to reply now, I should like to reply to later.

†The hon members for Mooi River, Berea and others referred to the indaba proposals. I would just at this stage like to point out that I dealt with this matter in a reply to a question on 15 February 1989. It amounts in substance to the following: That although the Government welcomes initiatives like the indaba, the proposals are not in line with our framework of principles for constitutional development. The nature of these was pointed out by me on that date. However, I am discussing these proposals with the chairman and other participants in the indaba and I shall report on that at a later stage.

I want to thank the hon the Deputy Minister for Population Development for his comments and I would like to say that we are committed to implement what we say in principle.

*I agree with the hon member for Mossel Bay that there are only two ways in which change occurs—through violence and through negotiation. Democracy and negotiation go hand in hand and are in fact twin brothers.

†I thank the hon member for Mooi River for his positive contribution.

*I agree that the CP’s policy of partition is not attainable without the co-operation of other groups, as the hon member for Bloemfontein East indicated.

The hon member for Swellendam clearly pointed out the CP’s commitment to racism, and I think his contribution was an effective one.

I always enjoy listening to the hon member for Macassar, not because he represents my neighbouring constituency, but because he usually makes his speech from the heart. I want to compliment him on the zeal with which he represents his people.

The hon member for Turffontein made the valid point that we had to accept the realities of South Africa and that there were no simplistic solutions. I agree with him.

I should like to place my sincere thanks on record as far as the hon the Deputy Minister is concerned, not only for his contribution, but also for his teamwork and co-operation during the recent period in which we have co-operated.

I thank the hon member for Vryheid for his contribution and also for the work which he, together with his colleagues, have done on the Commission over a period of many years. I just want to confirm that the Government has decided to extend the period of office of all commissioners to the end of December of next year. With that we afford the Commission an opportunity to dispose of the outstanding consolidation and so that the Government can also have some time in which to deliberate on the way in which the Commission is going to be utilised in future.

And the members who lose their positions?

If the hon member were to look at the Act he would see that one need not even be a member of Parliament to serve on the Commission. Consequently there is still hope for the hon member too. [Interjections.]

The hon member advocated that we should give consideration to appointing members of the other Houses to the Commission. The Government is quite prepared to give that favourable consideration.

The reprehensible observations made by the hon member for Green Point do not deserve any comment.

†To the hon the Minister of the Budget in the House of Representatives I wish to say immediately that I agree with him when he says that White minority rule is as unacceptable as Black majority rule.

*That is why I say that we must co-operate to address the problems of South African society so that we can escape both those things, which we do not want, and get something that all of us would like to have.

The hon member for Ermelo said that the Government could not guarantee that it would succeed in its ultimate goal because everything was subject to negotiation. I now want to ask the hon member whether he has a policy which is not subject to negotiation, or is he going to force his policy on communities? That is by implication what he is saying.

I agree with the hon member for Parow that the recognition of groups in units is important for our country’s future and that to disregard this will quite probably lead to conflict and violence. I also agree with him that the CP focuses essentially on race and not on people.

I listened attentively to the original and interesting contribution of the hon member for Bloemfontein North on urbanisation, including the historical perspective. I should like to study it further.

The hon member for Sundays River made out a strong case in regard to administrative functions that should not be duplicated. I agree with him. I do not think it is necessary for all the political institutions or functionaries to have their own administrative substructures. I think effective management means the utilisation of all our means; also the means of our officials.

†I believe that the hon member for Vryheid replied in detail to the hon member for North Coast’s question on the consolidation of KwaZulu.

In conclusion, as far as the observations of the hon member for Bryanston are concerned, I just want to say the following. I would like to remind the hon member for Bryanston that environmental awareness as indeed our planning inputs such as energy issues, evolved amongst other things from a special directorate in the erstwhile Department of Planning and is now the main thrust of the Department of Environment Affairs. Ever since the enactment of the Environment Conservation Act of 1982 the Council for the Environment has advised Government on a full spectrum of environmental measures. The present Bill on this issue will surely place the country in the forefront of modern thinking on integrated environmental management in the whole planning process at all levels. However, I agree that special responsibility also rests with the developers and their consultants as well as the regional development advisory system to ensure that environmental matters are addressed effectively right from the conceptual stage of all development planning.

*I should very much like to associate myself with what the hon member for Diamant had to say about shared values. I believe that we are being pathological when we harp too much on what we think is wrong and constantly harp on the differences. [Interjections.] I believe there are many positive points which we can utilise for the development of our country. [Interjections.] If we are agreed that we have to share this country with one another, we must also help develop an enhancement of shared values, because without shared values there can be no question of a development of democracy. [Interjections.]

[Inaudible.]

I want to tell the hon the Chairman of the Ministers’ Council of the House of Representatives that he is in this Chamber as a result of an adjustment to the boundaries that implied restrictions…

Thank you for that.

No, he need not say thank you; we are all responsible for that because we all worked on it together. This is not a one-man effort.

†I should like to conclude by thanking all the hon members. It has been said that obstacles are what one sees when one takes one’s eyes off the goal. I believe that if we keep our eyes on the goal of improvement of the country and the quality of life of the people and of the participation by all groups in government, we shall obtain those goals.

They tell me the Basuto have a saying that goes like this: “When the day breaks, we thank the Man who led us through the night.”

*I hope that in future the people of this Parliament will say: “We thank the men who led us through the night.”

Mr Chairman, of the three occasions on which the on the Minister addressed the Committee, Friday’s speech was probably the most important because in it he announced the NP’s vision of their future constitutional plan for South Africa.

It helped to clarify about the direction in which the Government is moving, but it did not clarify the methods that had to be employed to achieve it. There is greater clarity about the direction, namely that of one undivided state, one Cabinet, one Parliament and one legal system for South Africa. [Interjections.]

With that the hon the Minister has reduced the difference between the NP and the DP to two very minor points. The first difference is namely that of a few years. The NP says that there will be majority rule in ten years, according to the hon the Minister of Information, Broadcasting Services and the Film Industry, who says…

He did not say that.

No, Sir. He said that it would not occur within the next ten years. [Interjections.] The hon the Minister of Finance said that it was inevitable that there would be a Black government in South Africa. [Interjections.] The NP says ten years; the DP says at any moment. They are correct, Sir. That is the one minor difference.

The second difference which remains, is that it is the DP’s policy because they want it to be their policy. It is the policy of the NP because it has to be their policy. In his first speech on Friday the hon the Minister gave the game away himself when he said that one must do what one has to and not what one wants to do. With this he implied that if one has to get married, one has to get married even though one might not want to. [Interjections.] I want to tell the hon the Minister that owing to the NP’s rashness in the past…

Are you speaking from experience? [Interjections.]

No, as a result of the rashness of the NP in the past, when they did not think before they did something, they now find themselves in the position that they have to do something which they do not want to do. The announcements made by the hon the Minister, and what was said by the hon the Minister of Information, Broadcasting Services and the Film Industry and the hon the Minister of Finance, confirm one thing and that is that Black majority rule in South Africa is inevitable according to the NP’s vision.

The NP has failed all the nationalists of all population groups in South Africa, and nationalism is the strongest power in the life of any nation. When the NP started with the present Constitution in 1982, it gave certain guarantees and offered certain things as non-negotiable, things it was not going to surrender. Firstly it said that it was not in favour of a unitarian state; a unitarian state was out, it was not good for South Africa. Now, however, it is the NP’s policy. It has failed. [Interjections.]

Secondly the NP said that a federation or federal concepts were out. It was not in favour of that; it was an old SAP policy which had been rejected. It has failed, because federal concepts and a federation are now acceptable. [Interjections.]

When the NP introduced this Constitution, it said that there were certain laws which were non-negotiable. It said that the Prohibition of Political Interference Act and the Prohibition of Mixed Marriages Act were non-negotiable. I think that the hon member for Hercules remembers so well that they said it that he is now retiring from politics. There were many other Acts which were non-negotiable, but which are not even in the Statute Book today. They failed. They could not uphold those laws. Now they have placed the Group Areas Act, the race classification legislation and the Reservation on Separate Amenities Act on the line. [Interjections.] The NP does not even say that they are going to uphold those laws anymore.

When they started with this Constitution, they said that group identity and protection were the cornerstones and were non-negotiable. [Interjections.] Now they say that these are no longer an obsession. [Interjections.] I do not know on whose behalf the hon the Minister is speaking, or whether he is really speaking on behalf of his leader who was watching him here yesterday. [Interjections.] When they started with this Constitution they said that the nature and character of the House of Assembly would not change. [Interjections.] However, they now say that there is going to be one Parliament in future. They said that there would be no fourth chamber. [Interjections.] We told them that the Black people would probably participate in the same Parliament, and now that is so. [Interjections.] When they started with this Constitution, they said that the Black people would not be brought into the same dispensation as the Whites, the hon members of the House of Representatives and the hon members of the House of Delegates. [Interjections.] It was said that there was a completely different political dispensation for them by means of the self-governing and independent states. However, they now say that the political dispensation will be as I have indicated. They have failed. Nothing of what they said would remain the same is remaining the same; they are abandoning it all. [Interjections.]

At the time the CP said that all these things were going to disappear. The CP said that the Government would abandon all these things, but it was said these were mere CP stories. The Government, however, abandoned them. The CP said further that the road taken by the Government was leading them to Black majority rule and an ANC government. [Interjections.] Today this Government is already negotiating with the ANC’s masters, namely the Soviet Union. The proof is there that the Government is inevitably on the road to Black majority rule. [Interjections.] It is true.

As I have already said, the hon the Minister has not announced any details about how these objectives of his are to be achieved. There are a few terrible weaknesses in his announcements. Firstly he said that group protection must take place by means of legislation. The NP goes to the negotiating table to negotiate with the other groups. He says that groups must be protected. However, I ask which one of the other groups it is that says that groups have to be protected and that it has to be done by means of the Act. The hon the Minister goes to the negotiating table without there being one other partner who says in this stage that groups must be protected. When he gets to that table and the other negotiating partners say that groups do not have to be protected, what is he going to do? Is he going to leave the table? [Interjections.] Will he leave the table or will he capitulate? He is going to capitulate.

The hon the Deputy Minister of the Budget said yesterday that groups should not be protected by the Act. The Chief Minister of KwaZulu says the same He also says, just as the hon the Deputy Minister of the Budget does, that the Government should negotiate with the ANC. I ask on what group the Government is depending to help it to protect the groups, or is it perhaps relying on the open group that is to be established to support groups?

The second mistake made by the hon the Minster is that he says that those groups who do not want to participate in the dispensation he envisages do not have to. However, no alternative is given to those groups. They do not have to participate, but then they have no say whatsoever; then they are completely outside the jurisdiction of Parliament and they are controlled by the other remaining groups.

The hon the Minister goes on to say that regions which want to become independent, can become independent. This means that the self-governing states can become independent if they want to.

However, it is not possible to reach consensus between partition and power-sharing. The fact is that it is now possible for those Black peoples who want to become independent, to become independent, but it is not possible for the Whites. They are being deprived of their right to do so. [Interjections.]

The CP, however, is going to exercise that right. The Whites are entitled to it and we are going to do it. [Interjections.]

Order! I cannot allow hon members to keep up a running commentary. The hon member for Lichtenburg may proceed.

The next mistake which the hon the Minister makes is that he says that he wants a dispensation in which numbers do not play a role—only within groups, but not between groups. When he goes to the table and the other groups tell him that they are not interested in a dispensation in which numbers do not play a role, what is he going to do then? Is he going to leave the table or will he capitulate as he did in the past?

Today I want to ask the hon the Minister why he does not give South Africa an example of how groups negotiate and how groups reach decisions without numbers playing a role? There is a coming Presidential election. There are three groups in Parliament. It is less than the Parliament that he envisages. He must indicate to us by means of the Presidential election how three groups, which have equal representation, elect a President, and he must tell us what the result will be. He can do that; it is an easy example. However, he has built in numbers to ensure that the House of Assembly elects the President. However, if the President is elected by the groups, the House of Assembly cannot do so.

There you are correct.

Of course; surely that is true. He uses numbers when it suits him and when it does not suit him, he does not use them. [Interjections.]

I am asking the hon the Minister why he did not show the world how such a formula could work in South West Africa. Why did he not use it there and show the voters of South Africa that this formula is a success and that it works? He had the opportunity, but he did not use it.

Mr Ian Smith had a formula in Zimbabwe, but look at what that led to. I am saying that such a formula does not exist. Such a formula cannot be obtained. However, the hon the Minister says that he is going to the negotiating table to negotiate the formulae for the protection of groups and the elimination of numbers. Such a formula does not exist.

I want to give the hon the Minister the following example. A doctor treats his toe, but later his toe has to be amputated. Is he going to accept the doctor’s word when the doctor tells him that he is going to cut off his head, but that he has a formula which will guarantee that the hon the Minister will not die, but that he will live? Is the hon the Minister going to believe him when he says that he does not have the formula yet, but that he will find it between now and the operation? [Interjections.] That is what he is telling the people.

The hon the Minister has linked this whole plan of his to the election. He says that the formulae must be negotiated, but I am saying that there are no formulae. When he goes to the negotiating table after the election and negotiates, is he then going to come back to the voters of South Africa and present them with the formulae for their approval before they are implemented. [Interjections.] This is of crucial importance. [Time expired.]

Mr Chairman, we have now listened to the deputy leader… [Interjections.]… the hon the deputy leader of the CP. Yesterday afternoon we listened to the hon the deputy leader of the LP. When one has listened to both of them, one realises that they are not taking the realities of our country into consideration at all. [Interjections.] This is really the case. I want to tell hon members that the LP does not want to accept that we have to differentiate between general and own affairs in this country. Am I correct in saying that they do not want to accept this? If they do not want to accept this, they are not accepting the realities of this country.

The CP simply does not want to accept that we live in a shared country and that this country is going to remain a shared country. If they do not want to accept that as a point of departure, they are not addressing the problems of this country. All the mistakes the hon member for Lichtenburg blamed on the hon the Minister here, are mistakes based on the wrong point of departure, because if one is not dealing with the realities of South Africa, it is very easy for one to criticise everything, but not put anything concrete in its place.

Today, in the few minutes at my disposal; I also want to talk about local government. I submit that the reform which has already taken place at local government level proves that success is being achieved with the policy of renewal of the Government. Very important foundations have been laid at this level and we can build on these foundations in our body politic.

I want to refer specifically to the Pretoria area. In rugby the Pretoria area is actually represented by Northern Transvaal. I think it is appropriate, after what happened last Saturday, to subject the Pretoria area to close scrutiny. During the municipal elections in Pretoria last year elections took place, according to separate voters’ rolls, in separate municipalities—in Verwoerdburg, Akasia and Pretoria for Whites. In Eersterus for Coloureds; in Laudium for Indians; and in Mamelodi and Atteridgeville for Blacks. These elections took place in a democratic way, and if one looks at the percentage poll in this area, one sees it was a very great success.

Fortunately the NP won in Verwoerdburg and Pretoria, for just consider the disastrous consequences, economically and internationally, if the CP were to govern the administrative capital of our country! And then one is not even talking about the negative consequences the CP’s racist policy would have on good human relations in the area.

I want to tell hon members why the NP won. It won because it presented a balanced and fair policy to its voters. The NP won because it could assure the Whites that they were entitled to an own community life. [Interjections.]

Yes, hon members can shout about that. I want to tell them that we are proud to be White and we are proud of our own community life. If those hon members are not proud of it, I do not care.

The NP won because it stated its standpoint clearly that own residential areas have to exist for communities that want this and, what is more, that the State is compelled to recognise and protect the right of those communities to dissociation. We told our people that.

This standpoint has nothing to do with racism and discrimination. It is based on the group interests of a specific community and, more importantly, the necessity for orderly co-existence in a multiracial country.

We said you were the same as the CP!

Without orderliness we will be doomed to unrest and tension.

The NP regional council of Pretoria, in which the 13 constituencies of municipalities of Pretoria, Verwoerdburg and Akasia are represented, has adopted the clear standpoint that no existing residential areas in the area should be considered to be free settlement areas, and that the vested rights of the inhabitants in these existing residential areas in the Pretoria area must be maintained and protected.

On the other hand the NP regional council realizes that it is essential for provision to be made as soon as possible for a free settlement area in the Pretoria area. That is why the regional council requested the authorities to instruct the Free Settlement Board to investigate the area to the south east of Pretoria’s municipal boundary, known as Mooikloof, as a free settlement area.

This area of Mooikloof is approximately 760 ha in extent and can accommodate approximately 5 000 residential sites apart from the essential community infrastructure such as schools, churches, etc. This area as well as the proposed free settlement areas to the south and south west of Verwoerdburg, in the vicinity of the Development Bank and Diepsloot, should be proclaimed free settlement areas as soon as possible in order to safeguard the existing residential areas against infiltration.

However, if one wants to protect one’s own areas, one must also be prepared to grant one’s fellow citizens living space. That is why the Group Areas Board is in the process of investigating a large area for Indians to the north west of Pretoria, in the Akasia municipality, and the NP supports this step. For the past two years or more consideration has also been given to the expansion of Eersterus in order to give those people more living space.

The alternative areas advertised all affect my constituency, Roodeplaat, and as was to be expected, the CP played a role in protests. The CP is opposed to any expansion of Eersterus, whether it is to the east or to the north. This was stated by their spokesmen. On the eve of the previous election, during a general public meeting, I expressed my approval of the expansion of Eersterus. I said that the Group Areas Board was best able to make a recommendation on where this expansion should take place. I understand that the recommendations of all interested bodies are at present with the hon the Deputy Minister and I hope that the expansion can take place without delay.

I have now spoken mainly about own local authorities and the group areas which are their geographic power base. I also want to refer briefly to the Pretoria Regional Services Council. The hon the Minister referred in his speech this afternoon to the successes in the Pretoria Regional Services Council.

I merely want to point out that the CP has levelled the accusation that White money is going, in the first place, to the undeveloped areas. An interesting point I can single out in the annual report of the Pretoria Regional Services Council is that there are 18 different local authorities that are participating in the Pretoria Regional Services Council, and that every participating partner has benefitted from at least two projects. What is even more interesting is that Verwoerdburg, a White municipality, and Mamelodi, a Black municipality, each benefited from the same number of projects, namely 10. This accusation that everything is going to the Blacks, is therefore devoid of all truth. [Time expired.]

Mr Chairman, in following upon the hon member for Roodeplaat and having observed his discourse this afternoon, I must say that if he reflects the thinking of the NP then there is not very much difference between what he said vis-á-vis the policy of the CP. [Interjections.] When we entered the tricameral system, we experienced tremendous opposition from the community that we represent. However, we regarded the opportunity as a challenge to prove our worth in this country and that given the opportunity, we would rise to the occasion and prove that we would do everything possible in the interests and to the benefit of our beloved country, South Africa. We believe that we are citizens of this country and that it is our right and our bounden duty to do all that we possibly can to help South Africa to follow a course of peace, harmony and peaceful co-existence.

Normally I am critical of my colleague, the hon the Minister of Constitutional Development and Planning, whenever his Vote is under discussion. Simply because I do not want to be destructive in any way with regard to what the hon the Minister has already achieved, I just want to add to what has been said should be done to further ameliorate the position in South Africa. It is necessary that we should go back in the history of South Africa over the past 40 years because this has led to our present situation which is a challenge that we have to face in the future.

The essential destructive force has been the Group Areas Act. As long as this Act remains on the Statute Book of this country, we will not achieve what we all aspire to. Therefore, when all is said and done, I believe—like hon members in this Committee—that the Group Areas Act, which is the foundation of apartheid, must go. I want to say with the greatest respect that we have experienced what own affairs and general affairs mean during this five-year period of service. Own affairs and general affairs intertwine and overlap one another. Therefore I plead with the hon the Minister that he must look at a future dispensation and plan future development in such a way that we can do away with own affairs and general affairs and can have common affairs for all South Africans.

People of all political persuasions must be able to participate in the decision-making processes of our country so that we can face the people inside and outside South Africa unitedly and show them that we are doing what is expected of us as South Africans for harmony and peace.

This brings me to the White Paper on Urbanisation to which the hon the Minister referred. It is all good and well that the White Paper was presented. This was done in good faith. However, did the hon the Minister’s department take the necessary action to elevate a situation which has now developed on the peripheries and borders of our cities? There is a tremendous influx of people on the peripheries and the borders of our cities and they are without jobs or proper housing. If the White Paper on Urbanisation was implemented, we would not have the situation that we are experiencing today.

The quality of life of the people who live in squatter conditions, is abominable. They are there at the risk of their health and the shortening of their lives. In addition, they are creating a social problem for themselves and for the people of government.

Constitutional development and planning and development go side by side. I want to applaud the hon the Minister’s announcement this afternoon of the development phases that will take place in the future and the fact that he would like to see private enterprise participating without prejudice to them in this plan of development. I would like to say that we must create for the labour force a situation where they can be happy workers in a given situation. The unhappy experience of people of colour is that the industries are in the centres of industrial areas or in cities, or in certain cases, in the self-governing areas. Think of the work-force living 30 to 40 kilometres away from the work-place. The worker lives in a place which is a Third World situation and he comes into the city into a First World situation where he enjoys all the facilities in the work-place. The moment he leaves his work-place and he goes back to his home, he enters a Third World situation where by neglect we have failed to provide the proper infrastructure for him to enjoy his rest period.

This is in my opinion—and that of many industrialists—a feature which is absolutely distressing. It causes stress. It causes an unhappy situation for the worker and therefore when he comes into the work situation, he is not in a position to give of his best. As a result of that, productivity suffers. South Africa, like any other country, must concentrate on the export of its products. Production and productivity will rely very heavily on happy work situations so that the production can be to the extent to which one would expect productivity to be.

I want to say very briefly that the policies of the NP Government over the past 40 years have destroyed the fabric of the lifestyle of people; have taken them from one social order to another. This has been very distressing.

I want to refer to a few instances in the Eastern Transvaal. Despite the fact that people of colour and in particular the Indian community who, at the time of the hearings of the Group Areas Board, made the plea that in the interests of commerce and industry in places like Bethal, Piet Retief, Ermelo and so on, they should not move a settled community out of their places and put them away out of the towns and on the boundaries of the towns, these communities were still forcibly removed. In the process the implementation of the Group Areas Act interfered with and destroyed the religious beliefs and the religious facilities of people in those towns.

A case in point is Bethal. We have a mosque in the centre of town and we had areas next to the mosque which could easily have been developed for the city, but what has happened? The city council of Bethal and the MP for Bethal are not giving their co-operation and are of no assistance to a community who have lost their religious rights because of group areas.

All of this portrays a dismal picture of South Africa to the outside world. This does not help us. I speak to hon members as a fellow South African. Where is their sense of justice? Where is their sense of responsibility? Or have these senses and values taken leave of their consciences?

Let us then address ourselves to the nitty-gritty which hurts our people, the people of South Africa. Let us find the answers that we need and let us remove from our Statute Book the Group Areas Act, the Population Registration Act and the Reservation of Separate Amenities Act and let us not say that the people of colour prefer own and general affairs to be separated. This is not in the interests of South Africa.

I was glad that the hon the Minister spoke about Prospecton. If ever there was a robbery it was Prospecton. If ever the community of Isipingo was done an injustice it was that robbery which was the result of Government statutes. It was a rate-producing area. They hived off two areas, Isipingo Rail and Isipingo Beach, took the centre out and gave it to Amanzimtoti. That was an extreme injustice. I respectfully bow to the hon the Chairman of the Ministers’ Council in the House of Delegates who said that rates in that area must now be shared between Umzinto and Isipingo and I hope that the hon the Minister will apply his mind to this. If we want justice to be seen to be done that area must be incorporated into the Isipingo municipality.

There is also a little place called Reunion which is sandwiched between a main road and a railway line. That area falls under the city council of Durban, although Reunion lends itself ideally to be part of Isipingo. In the absence of the hon the Minister I want to appeal to the hon the Deputy Minister to look at Reunion as well.

Coming to the recent development of free settlement areas I want to give my considered view after years of experience. Let us not just look at Block AK, the Warwick triangle or an area in Hillbrow. Let us look at a large geographic area. The concept of free settlement areas can then lend itself to tenability. As I read the Act, the proclamation of a free settlement area can be shot down if some local body is opposed to free settlement areas. I believe this is unfair even though the Free Settlement Board will entertain all kinds of views and opinions during their hearing. Let us not look at small patches but rather at large areas for proclamation as free settlement areas.

I have said repeatedly that if ever I have had satisfaction in expressing myself at a forum it is in this forum. Here we can speak eyeball to eyeball and face to face and we can talk openly and freely without any inhibitions so that the Government can understand our point of view and we can understand theirs. While we do not expect them to adopt a dogmatic attitude, we do not expect the rulers as it were, the NP, to treat us as if we are adopting such an attitude.

We want an accommodation for all South Africans so that we can live peacefully and happily and hold our heads high. Then posterity will say that given the opportunity we did our best to see that the future South Africa would be free of all kinds of prohibitions and inhibitions.

Mr Chairman, I wish to say to the hon the Minister of the Budget in the House of Delegates that the scrapping of the Group Areas Act will not be an instant solution to all of South Africa’s housing problems, but I will come back to this matter at a later stage. [Interjections.]

*The CP still denies the realities of South Africa when it comes to urbanisation. My colleague, the hon member for Bloemfontein North, dealt with the various philosophies and approaches with regard to Black urbanisation. Whatever the philosophy, the reality that counts is that Black urbanisation is still occurring and this Government regards it as its duty to tackle this phenomenon in an orderly, humane manner.

The CP is still proclaiming everywhere that the abolition of influx measures is the reason for Black urbanisation. It is not true. From practical experience I can tell them that a sentence of R50 or 30 days’ imprisonment never frightened anyone who wanted to come to the cities. The fact that these people were arrested and sentenced repeatedly, proves my statement.

Urbanisation does not take place as a result of the abolition of ineffective influx measures. By decriminalising an inevitable situation, this Government faced the realities and contributed towards the removal of one of the greatest obstacles in the way of good relations between the different races, namely the lack of freedom of movement of all inhabitants.

If what I have just said has to be accounted for in practical terms, it implies that we shall have to assist in establishing the necessary infrastructure to accommodate these urban-dwellers in a socially acceptable way. [Interjections.] For this the first requirement is sufficient land for settlement purposes. During the past few years the Government has done a great deal to identify and set aside suitable land in terms of the provisions of the Black Communities Development Act, 1984.

However, it is a pity that the Government experiences such opposition from all quarters when the matter of land for occupation by people of colour is raised. Even the CP admits that it is conducive to instability when people are not housed on a socially acceptable basis. They deny the realities that the people are here to stay, and still want to isolate everyone into neat compartments according to their utopian policy, even against their own will and wishes.

The hon members of the House of Representatives have repeatedly voiced their objections to any attempt at isolating them in their own area. The Official Opposition in the House of Assembly has consistently failed to indicate what it is that they envisage for the Coloured population. The electorate of South Africa are being deceived by a fine-sounding policy which cannot succeed in practice and does not contribute to stability and good relations.

On the other hand the DP believes that the abolition of the Group Areas Act and the opening of all areas will be the solution to all the problems. This standpoint does not keep pace with the realities of South Africa either. A large part of the Black population specifically, are people who cannot afford to compete for property on the usual open property market. The opening up of areas will never be able to provide this group with accommodation.

The Deputy Minister of Population Development admitted in his speech during this debate that the alleged 37 000 White housing units that are available, will not have a material effect on the existing requirements. Why then blame the Group Areas Act for all the housing problems that exist? [Interjections.]

Everyone complains about squatting, and rightly so. It is a tremendous problem which is aggravated by urbanisation. Nobody can or will approve of people encroaching in an uncontrolled way on the property of others and establishing themselves under extremely bad conditions but—and this is very important—if there are no areas available where people can settle legally the result is squatting.

Unfortunately it is also true that some people are under the impression that one only has to squat in order to receive a house. This point of departure is totally incorrect and will lead to persons finding themselves in a worse position than before.

Without going into detail again, I only have to refer to the provisions of the Prevention of Illegal Squatting Amendment Act, 1988, to place on record to what extent the Government is in earnest about the prevention of the squatting problem.

I have already referred to the fact that a large part of the Black population who have a need for housing only have limited funds, and that in these cases conventional housing does not seem to be the solution. The State can no longer afford to provide these people with housing. The private sector itself can only provide limited relief in these cases. The only viable solution will have to be found in the development of informal residential areas. The State will not be able to do more than to provide sites with rudimentary infrastructural services. People will have to erect their own structures and as and when self-generated funds and means become available, the upgrading of existing structures will take place. This is the reality of South Africa and the sooner we accept this reality and find practical and viable solutions, the sooner we shall have and preserve stability.

A human being’s primary need for housing, however simple, is the cornerstone for peace and tranquillity. It has nothing to do with palaces or castles, but with the right to be able to reside legally without the fear that someone can drive you away at any time.

Mr Chairman, we cannot lose sight of the fact that the amount of land is not increasing. Although I plead for sufficient land to be identified and made available, I must also warn them that in certain cases the available land must be utilised more constructively. I believe that far more must be done to the development of high density housing, for example flats. The existing concept that all Black people want to live on the ground, is no longer valid. One only has to refer to Black people who already live in flats in areas such as Hillbrow. The objection that the costs involved in high density housing are too high is not valid either. If one only looks at the savings on the cost of land and the provision of infrastructure, it is clear that this saving more than compensates for the increased building costs.

Much has already been accomplished, but there is still a lot to be done. We must not flinch from the problems and challenges of South Africa. We should all work together, in an unbiased and fearless way, to find a viable solution so that we can do justice to this wonderful country of ours.

Mr Chairman, the hon member who has just spoken will forgive me if I do not follow him in his subject, but I want to deal specifically with the two speeches made by the hon the Minister—the one on Friday and the one on Monday.

When I spoke in this debate last Friday and commented briefly on the hon the Minister’s opening address, I said that the language was refreshing but that we wanted more time to study some of the obvious anomalies in what the hon the Minister had said. I said that it was difficult to reconcile the hon the Minister’s words with the legislative record of his Government in any case.

Since then there has been widespread comment in the Press and through the media generally on the hon the Minister’s speech of Friday. Most of it has been favourable and most commentators saw his comments as an indication of significant change and reform in the NP’s policy.

Then we had the hon the Minister’s speech on Monday. I must tell the hon the Minister that he was much more lucid and encouraging on Friday than he was on Monday. Something must have happened over the weekend, because on Monday the bright vision of Friday had become totally blurred. What had been a good Friday became a blue Monday.

On Friday we had a vision of a move away from rigid group thinking and acceptance of the principle of voluntary association, and we had the statement that a legislative authority was coming in which all people could participate on the basis of absolute equality irrespective of race. It conjured up a picture of a major change in NP thinking and it was certainly presented as Such by the SABC and most of the major newspapers around the country. That was Friday.

On Monday, however, with the hon the State President and the new “hoofleier” sitting on his left, we had a prepared amplification of Friday’s speech which contained a great deal of gobbledegook, but which in essence took us back to the old group concept. The words the hon the Minister used were “equal group participation” which amount to the old group concept in the Government’s constitutional thinking for the future.

We were told that numbers were not important because democracy would function on the basis of equal group participations—minority groups having the same power as majority groups. In other words the hon the Minister was offering a constitution where the passage of laws would be based on concurrent majorities on a group basis, which I believe is a recipe for inevitable conflict.

True, the hon the Minister repeated that there would be voluntary association in that individuals could decide to which group they wished to belong and then would exercise their rights through that group, but that begs the issue as to how long an individual would want to, or be allowed to be attached to a particular group in the exercise of his rights.

Take for example a member of the so-called Coloured community whose culture and language is Afrikaans, who belongs to the same church as his fellow Afrikaners and who identifies totally with them. Would he be allowed to exercise his rights equally within an Afrikaner-oriented group? Would he be allowed to vote on a common roll in, say, Bellville or De Aar alongside his fellow Afrikaners, and live in the areas and send his children to the same schools as the other members of the group with which he has associated, and would he be accepted by that group?

These are questions which need answering because until they are, the group concept in South Africa will remain an excuse for racial exclusivity and therefore a perpetuation of racial division and animosity.

I believe that inevitably the solution to our problems in South Africa must be based upon the protection of individual rights and a determined move away from rigid group identities.

I believe that an entrenched Bill of Rights, a rigid constitution, an independent judiciary, devolution of power on federal lines—these are the real protections for individuals and ultimately for the minority groups to which they seek to attach themselves.

I believe further that in all this, cultural and language protections can be adequately contained within a constitutional framework, without thwarting the essence of real democratic government in a way that the requirement of concurrent majorities on racial or group lines will do.

Much of the hon the Minister’s speech yesterday was designed to blur issues in the face of the September election. It was a backtracking speech on his apparently enlightened Friday vision, designed to allay fears that such so-called enlightenment will be exploited by the CP at the hustings. So it was the NP as before with the same old double talk, and that was disappointing.

By the same token his efforts which were echoed by others on his side, to cast doubts upon the integrity of the DP on the issue of talks with the ANC were nothing more than a pre-election salvo which does not augur well for an objective and responsible election campaign. It was of course totally reminiscent of the NP tactics in the 1987 election.

No sane observer of the South African scene can ignore that if we are to achieve a negotiated settlement in South Africa, the ANC must be a factor in such negotiations.

The hon the Minister on Friday said there were only two alternatives for South Africa—negotiation or conflict. Does the NP exclude the possibility in any future negotiations that the ANC will be part of those negotiations?

But didn’t you listen to what I said?

The hon the Minister must not interrupt now. The hon the Minister’s comments on our situation where we have said we are prepared to talk to the ANC in order to negotiate a settlement were to try to make cheap political capital of that situation.

We can speculate on how big a factor the ANC may be. Some people say it has a support of 50% of the people, of the masses, some say 40%, some say 20%. I think that is hardly relevant. The fact is that it is an important factor in the South African political scene.

The extent of its support cannot be accurately determined at this stage. I want to suggest that the more the ANC is dragged into futile political debate for cheap party political gain in White politics, the more its significance is elevated in the eyes of the masses because such tactics increase the perception that it is an organisation which is feared by the White minority.

In the end I believe the degree of its relevance and strength will be determined by the degree to which the masses look to it as a liberation movement. If through our obstinacy and reluctance to accept reasonable negotiated change the ANC is allowed to be perceived as the only instrument for the liberation of the masses from the oppression of White minority rule, its significance and power will be very considerable indeed.

The DP’s view is simply that it must be recognised as a factor in any negotiation. We are not in alliance with it, but we do believe we must talk to it as we must talk to other organisations. We will talk to the ANC, we will talk to the NP, we will talk to the CP, we will talk to Inkatha, we will talk to all organisations which must be factors in bringing about a resolution of the South African problem in order to avoid further violence and achieve a peaceful negotiated settlement.

If the NP and the hon the Minister wish to make cheap political capital out of our association with the ANC, then let them do so but I believe they must realise that by so doing they are, in fact, not serving the best interests of South Africa.

Mr Chairman, I think we have to accept that the ideas which the hon the Minister put on the table last Friday—although he appeared to retreat from them to some extent—are aimed at removing the remaining traces of the callously exploitative oppression of the past. They are also aimed at finding a way to avoid the obviously naked domination of the majority by a minority. I trust that that is the aim. The notion of one Parliament for all South Africans—in real and not in tricamerally camouflaged terms—is immediately attractive. A reversion to a single executive authority at the national level with corresponding mechanisms at the lower tiers of government is sensible.

Apart from all the other factors—the wasteful multiplicity of structures, the vastly expanded bureaucracy, the interminable delays caused by countless additional memoranda and meetings and paper-chasing—it is the tremendously increased opportunities for nepotism and corruption and downright theft that we have observed since, I am sad to say, the tricameral Parliament was instituted and which are offered by the racially divided executive authorities, that will be eliminated once we revert to a single executive authority. The hon the Minister shakes his head, but of course he has a great deal of experience—40 years of experience with regard to a single executive authority—and I trust that the hon the Minister does not himself know about corruption in the past that we do not know about.

I reject that!

Well, Sir. I accept that rejection with pleasure.

If it is intended to eliminate all these opportunities and if it is intended to have a single Parliament and a single executive authority, why the rather indecent haste with the acceleration of own affairs activities? Why take action such as that which at the J G Strijdom Hospital prompted those who prefer the Hippocratic oath to the hypocrisy of vertical apartheid to protest in a self-sacrificing manner?

These doctors have made a great sacrifice in pursuance of principle. If racially-based groups, on whatever definition, are to be represented on an ethnic or communal basis, that would appear to remove domination. However, separation will persist. That will not only be divisive and dysfunctional, but will in the long term also be destructive. Since a constitution must be so framed as to promote harmony even if not amity and so framed as to obtain the consent of the governed even if not full agreement by all of them, racially separate representation is contraindicated. Since in any system there will inevitably be competition for available resources, it is desirable to channel such activity into ideologically based non-racial groups such as employer and employee organisations; business and environmentalists; capitalists versus socialists; and yes, Sir, even the bleeding-heart do-gooders as against the money-bag Scrooges.

Competition on a racial or colour basis will inevitably lead to antagonisms, friction and inter-racial hostility of a kind we have never before seen in this country. That is hardly a sound basis for a constitution.

I recognise that what I am suggesting is that which is necessary, and that I do not suffer the constraints of what is politically possible for those who are in power, but if those people wish to retain power at the cost of the destruction of the country, then they are damaging the country. The country must not allow itself to be seduced by nice-sounding plans which may be superficially attractive, but which upon careful examination reveal that they will be harmful to our country and to the future generations of our people. Vertical apartheid replacing horizontal apartheid still remains apartheid and still retains every single abhorrence that we feel for apartheid. It still maintains every single abomination that exists within apartheid.

Mr Chairman, I am not going to argue at any length with the hon member for Reservoir Hills, except for the one statement he made about a tricameral parliamentary system lending itself to corruption. I merely want to ask him the following question: Where in the Western World is there a government that is free of corruption—the United States, the United Kingdom, Germany? If there is such a government, he must tell us.

Soft on corruption! [Interjections.]

I should just like to tell the hon member for Berea that as a whole his speech leads me to believe that the leadership troika of that party is unhappy with the initiatives the NP has already taken.

I want to tell the hon member for Lichtenburg that he has spoken to us for the whole afternoon and told us nothing about what is going on in the CP. As far as Boksburg is concerned, there are so many things that are going wrong for the CP that those people now longer know what the CP’s policy is.

I want to refer him to what happened when recent discussions were held in the town council about whether they should introduce apartheid signs in all the parks. According to the Boksburg Advertiser the following exchange took place.

Councillor Fourie of the CP introduced a motion that “Whites only” signs be erected, while councillor T J Ferreira, the Chief Whip of the party, seconded the motion. Shortly afterwards the council had to adjourn for five minutes, because the CP chairman of the management committee and the CP chief whip did not agree. [Interjections.] Then Mr T J Ferreira, the CP’s Chief Whip, told him they were now implementing NP policy. Then they went out of the chamber, returned and decided to reintroduce the “Right of Admission” signs. [Interjections.] That is how mixed up that party is, but I shall come back to them later.

I should like to deal with the problem of the identification of free settlement areas, and I want to use Windmill Park as an example to illustrate to what extremes right-wing radical parties go to prevent these areas from being proclaimed. I also want to deal with the other problems relating to free settlement areas.

I want to request the hon the Minister—his speech earlier on this afternoon also made this point clear—to allow urgent attention to be devoted to practical problems that are preventing the growth of existing White areas such as Windmill Park. In my opinion an investigation must be undertaken to identify such areas as free settlement areas; otherwise too little land will be available and we will have to purchase new agricultural land at a tremendously high cost, while these areas are not put to any practical use.

Because the population growth among Whites is minimal, areas such as Windmill Park contribute to the high cost of living of town dwellers. There has already been capital development of the infrastructure of these residential areas, and the other inhabitants of towns in which such areas exist, pay for their infrastructure, eg the roads, sewerage, power, water, the networks and all the other things that are not put to practical use at the moment.

In Windmill Park, with its 253 serviced erven, the town council has, for at least the past five years, being providing services for a mere 41 houses. They have to maintain the pavements there, run a bus service to and from the area and provide a refuse removal services and all kinds of other services.

After the bomb exploded in Windmill Park, the hon member for Overvaal told us that he had 800 residents who wanted to settle in Boksburg. To date not one of those 800 Whites has offered to purchase a house in Windmill Park. One does not know whether they do not see their way clear to living in Boksburg as a result of what the CP got up to there. Even the children of the former chairman of the CP in that specific town, who lived in Windmill Park, sold their house to an Indian family. If the hon member does not want to believe this, he should come and have a look at what is going on there. One also asks oneself who buys the houses they vacate, wherever they may vacate them, if those 800 Whites the hon member for Overvaal wanted to have moved have, in fact, moved.

Over and above the services that such a town council has to provide for a handful of residents, they also expect services such as schools, post offices and police stations to be provided by the State. Neither the State nor the local authority can afford to provide services on such an inadequate basis, because in the case of Windmill Park, the nearest shopping complex not only serves that small community, but also serves a neighbouring community, where 900 White families live. However, those people are now not being served at all, since the shopping complex has stood empty for a year. There is no pharmacist, garage owner, greengrocer or cafe owner who sees his way clear to taking his chances with such a small market.

Shortly after Whites moved in there, they came to the shocking realization that since all these services were lacking, they were paying much more on travelling expenses, insurance and other costs than would have been the case if they had lived closer to the town and had been keen on living in higher density housing. I therefore agree wholeheartedly with what the hon the Minister said, namely that we shall have to look at increasing the density of residential areas, particularly White residential areas. It costs the local authorities, the State and taxpayers vast amounts of money to provide services that are not being adequately utilised.

Whose fault is this? I believe that at this stage it is the fault of those who plan these areas. The CP town councils encourage people to go and buy there, expecting the State and the local authority to provide these services that are inadequate. In my opinion the State should also take a serious look at the way in which local authorities plan their densities, because it appears to me that the State plans for densities of 70 people per hectare, whereas in towns on the East Rand there are 20 people per hectare, particularly in White areas. I believe we shall have to undertake an investigation to identify the uses to which land is being put in the various towns. We shall have to obtain a clearer picture of residential areas and commercial and industrial sites.

The department will have to deal with this problem on a regional basis. If it is left to local authorities, every local authority will ensure that it has as many commercial sites as possible and not worry about its neighbouring areas. The result would be an oversupply of commercial sites in every town. By undertaking the investigation on a regional basis, the State would be able to compare to the population densities and could then determine whether or not there was overplanning in White residential areas. I agree with the hon the Minister, but I am asking us to ensure that this is not left to local authorities alone. Numerous Windmill Parks can be developed as free settlement areas in this way.

Secondly I want to deal with another, less pleasant matter. Here I am referring to the way in which parties behave here in Parliament. It has been my experience over the past few months that the CP, both in the city council and here in Parliament, use the most reprehensible methods to cast suspicion on the integrity of members of Parliament who dare to promote such areas.

The chairman of the management committee of the town council of Boksburg declared in a town council meeting that he was going to request the Advocate-General to undertake an investigation into what he called “die LP se knaende poging om Windmill Park as ’n Indiërgebied of ’n vryevestigingsgebied te verklaar”. When he could not obtain satisfaction there, he wrote to the hon the Acting State President and encouraged his friends here in Parliament “om soos lokasiebrakke te aas na die moontlikheid van ongerymdhede”, as the hon member for Soutpansberg has said here on occasion.

I believe that an investigation is called for if the integrity of MP is being impugned in this way, because this is a kind of “trial by slander”. The hon members for Delmas, Middelburg and Soutpansberg were party to what I have referred to. It is understandable when the chairman of the Boksburg town council, who is a former HNP member, sinks to that level, but I did not expect this of the hon members for Delmas and Middelburg. I did not think that they would allow themselves to stoop to that level.

The hon the leader of the CP owes me a reply. He once said that he did not agree with the way the Boksburg town council operated. I should like to know what he thinks about the way his members of Parliament operate. He owes me a reply, but let us leave the matter at that.

I believe we are living in a time of radicalism, and we shall have to tolerate more of this on the road ahead—particularly with the advent of the election. However, I challenge those hon members to repeat what they have said here in Parliament outside.

A final matter I want to deal with relates to the shortcomings of local authorities. It has been as our experience on the East Rand that no means exist to deal with corruption when it takes place within town councils. The department must also give attention to this, because the situation has arisen that when there is corruption, a town council cannot take steps against a member who is possibly involved in that corruption and has to wait until the court case is over. In the meantime such a councillor could be involved in decisions that are taken.

Mr Chairman, I certainly express much appreciation for the standpoint of the previous speaker, the hon member for Boksburg.

*I also have much sympathy for him because he finds himself in a difficult situation in that he wants to move, but cannot, because he is restrained by the NP’s policies.

†I have a lot of sympathy for him, but I will deal with this question of separation and separate amenities later.

It is regrettable that, when one thinks of the money expended over the past five years, we have not even reached where we ought to have reached after a period of five years. I notice that the total budget for the department of the hon the Minister for this year is something like R10,62 billion. If we look at this expenditure over the past five years, which would be plusminus R45 billion, then we want to ask whether this money has really been well spent. Has it been an economic investment? Has it been a political investment? Has it brought us anything in return?

On a personal level I want to express appreciation to the hon the Minister of Constitutional Development and Planning for his personal convictions. However, he is also in a situation where he has to sell a product which cannot be sold. [Interjections.] That is right; he is a captive of his situation. However, I am appreciative of the fact that he has said certain things that have been encouraging to us and to many in South Africa and to those in the international world. Yet it now behoves him, his department and his party to put into action those things that were enunciated here.

I would further like to mention that I agree with the report of the Department of Development Planning for 1988, particularly with regard to reform and participation under the heading of “Constitutional Planning” on page 1. I want to emphasise this once more by just mentioning that in this report on reform the following is stated:

That is the word I underline—

It goes on to say:

Again I agree with the use of the word “dynamism” in this sense that surely if we are going to remain static as the NP has remained for so many years, then there is not going to be progress. We need this dynamism in all fields, namely constitutional, economic and social.

It goes on to say:

This is underscored—

I cannot agree more. I quote further:

I cannot agree more because this is exactly our thinking, not in terms of a particular section of the community but in terms of the whole process in which the benefit of the whole South African society is involved.

It states further:

I underscore again for the benefit of the NP—

We have heard so much of the realities here this afternoon and various interpretations of what those realities are—

However, we have to ask ourselves how long—

We have said this over and over again, that unless cognisance on the one hand is given to the aspirations of the majority of people in South Africa and unless cognisance on the other hand is taken of the fears, in particular of a minority of people, we cannot reach a solution. However, those aspirations and fears must also be accompanied by a readiness to communicate.

We have already said in the past that our decision at Eshowe to participate as a party is not regretted at all because the future of South Africa lies in the participation of all South Africans in all decision-making processes at all levels irrespective of race, colour, culture or creed. Therefore I endorse the sentiments expressed in this report when it says on page 4:

I will try to spell out how we see this later on. It goes on to say that this necessitates a grasp of the reality of the South African situation, and further:

I will be using this word very loosely later on, not in terms of NP thinking but otherwise. It goes on to say:

Once again it is a beautiful sentiment. I wish every hon member of the NP can read what is being said here by the department, in terms of a common humanity; not a separateness in terms of racial classification or ethnicity but a binding factor which South Africa needs, namely that of a common humanity, in terms of the report—

We say “Amen” because this was endorsed by the hon the Minister when speaking here before. The three obstacles in the process of reform are namely race classification, the Group Areas Act and the separate amenities legislation. We again endorse the view that the elimination of all vestiges of racial discrimination are prerequisites in establishing this new humanity. The report concludes:

We in the LP are committed to this process of change, reform and participation. We are committed to the whole process of change because we believe that the old order must pass away and give way to the new. My hope is that those who will be returning to Parliament, particularly those in the majority party, will come back having been captured by and enthused with this new vision of commonality of a human society which ought to be established here.

I want to say in passing and for the information of this Committee, that again we endorse the fact that we condemn in the strongest terms the whole question of sanctions and disinvestment. In the light of our stand I had occasion to write to the Prime Minister of the United Kingdom expressing my appreciation with regard to their stand. Mrs Linda Chalker answered on behalf of the Prime Minister, and I quote:

We cannot afford to lose friends like these. There are people who are concerned about all citizens of South Africa and therefore we must move constitutionally in terms of our planning to a new commonality of being South Africa.

On this question of sanctions, I was concerned when it came to my notice that one of the nominees for the Harvard University Council was the Archbishop of Cape Town, Desmond Tutu. On behalf of my party I wrote to the president of the University, and he replied as follows:

He goes on to explain that Desmond is but one of 15 candidates and says:

I have quoted this letter in order to show that there are people who are concerned and that, although we are products of an apartheid society, we will do our best at all times to promote a greater interest in the well-being of all South Africans and, particularly, in the well-being of the country that we love so much.

I must, however, respond to certain things that have been said in this debate. We were accused of selling out because certain land was consolidated into KwaNdebele. When this particular issue was being considered, the LP looked at the principle with regard to the redistribution of land. It was, however, not a question of accommodating Nationalist Party policy with regard to consolidation. Perhaps I will say more in this regard later on. By making that decision, we emphasised that it remains unfair that 13% of the population—which is White—should own more than 70% of the land, and that Blacks in this country only own 13,8%.

Therefore we reject with contempt the insinuation made by the leader of the so-called United Democratic Party that there had been some financial agreements between people who were being expropriated and others who were willing to sell. Because the land that was involved was not lying vacant, it was not infertile and therefore not fit to be used, I want to endorse the fact that the land involved was arable, irrigated and fertile. It was the best of land. Some people of the liberal force were even afraid that the land would be wasted if it was given to the Blacks. So we were thinking along the lines of giving back to the Blacks that which belonged to them rather than considering the principle of consolidation.

The leader of the UDP also made the remark that there was open warfare between the LP and the DP. I also want to reject this with contempt.

I have said very clearly, and I still express the hope on this rostrum today, that the DP will become the Official Opposition in the House of Assembly because it is an important investment for South Africa that the majority party must have an opposition that is interested in the well-being of all South Africans. I want to say that I also reject that remark because there is no open warfare. We have an agreement on principles and we express the desire that the DP will do well. I want to remind the leader of the UDP and his one member that he has sung an unintelligible swansong in the House of Representatives. What he says is certainly of no consequence.

I should also like to use this opportunity to correct another impression. The hon member for Schauderville propagandises, particularly by means of insinuations and aspersions, when he associates the LP with the removal of Africans from Langa and Kabah. I made this statement in the House of Representatives and it is regrettable that my comment was not carried at all by the English-language Press, particularly in the areas involved and served by the Evening Post and the Eastern Province Herald. They carried the insinuations of the member for Schauderville without including my reply.

That is why I am mentioning here again that Kabah itself has always been a mixed area—I was a Minister of religion in that situation. It has never been occupied by only the African section or the Black community. We wish to state that the LP has already made representations to the hon the Minister concerned asking that 1 100 families now living in McNaughton must not be removed.

We also want to make a further correction or contribution for the edification of many people present and that is that the leader of the—what do they call themselves?—Reformed Democratic Party, I think—the hon member for Southern Cape—objected to the fact that a member of the LP had mentioned from this rostrum that that hon member had written to the hon the State President after I had requested his removal as the Minister of Education.

The hon member for Southern Cape wrote to the hon the State President, making himself available for any job that the hon the State President might need him for, perhaps as an ambassador going overseas. As a result thereof this leader of the Reformed Democratic Party wrote a letter to my Director-General in which he accused my secretary—one of my secretaries in education—of having leaked such information to the LP, which in fact then makes it true. He wrote to my Director-General, saying:

Of course, the man who can grant him that permission is now the Minister of Education and Culture. The office is my office but he is still so indoctrinated and conditioned that he must write to the White man to ask the White man’s permission to enter my office to remove these things. That I think is enough said on this topic.

I must go on. Time will not permit me to dwell too much on various things but I want to repeat what I have already said: With my party’s participation in the constitutional dispensation, we have set ourselves some broad principles as our initial task. Some of these are: To give serious attention to the specific needs of all people and all regions of our society in order to design concrete policy proposals. I use the word society here because of the fact that in the hon the Minister’s report or his department’s report there was emphasis on the question of society; to investigate existing discriminatory practices and the use of infrastructure facilities such as public transport, recreation, sport and education and to tackle their abolition; to strive for the abolition of general sales tax on essential consumer goods; to take steps at all relevant levels and institutions to attain participation for all in the decision-making process of government; to take practical steps to reduce the high unemployment rate, particularly as it affects the non-White community—that is those who are not White; to expand all over the country educational facilities with the mobilization of community development; to work for the financial strengthening of local authorities, and particularly as it concerns the funds available for the improvement of residential and commercial areas in our townships—of course here I need not mention again that our problem is the group areas; and that it is absolutely essential that all citizens of a particular town or city must be represented on the local boards or councils as such.

In preparation for negotiation as an investment for reconciliation it is important that attention must be given to the equalisation of spending on education.

This year we had a deficit of R150 million and we are now probably going to have a deficit of R180 million and more because of the unequal funding vis-à-vis education.

Reconciliation demands a restructuring of the educational set-up in order to ensure preparation for a new society. There must be a greater willingness and readiness to see education as a unified reality. It is also important that especially three discriminatory Acts must be repealed in preparation for negotiation. Therefore I agree with the hon the Minister of Constitutional Development and Planning that three obstacles must be removed, he may have stated later on that the Group Areas Act still remains Government policy, namely the Group Areas Act, the Reservation of Separate Amenities Act and the Population Registration Act.

We have already spoken about what we have achieved during the present dispensation, viz the repeal of the Prohibition of Mixed Marriages Act, section 16 of the Immorality Act, the Prohibition of Political Interference Act, the suspension of forced removals, the repeal of Coloured labour preferential areas, the granting of freehold rights to Blacks, the repeal of influx control laws and the end of provincial councils on which we had no representation. However, it makes nonsense of reform and the repeal of these Acts if people who are legally married are threatened with prosecution because of the Group Areas Act.

It is also very important that the Reservation of Separate Amenities Act must go. I read a report in last night’s The Argus which stated:

It goes on to say:

Just listen to the following, Sir:

It means that the apartheid beach in the constituency of the hon the Minister of Constitutional Development and Planning remains an apartheid beach. [Interjections.] It also means that I, although I am an MP, still cannot use the facility of a library in the municipal area of Uitenhage because it is reserved for Whites. That will remain. I quote further:

May I indicate from this platform to the hon the Minister concerned that under no circumstances will the LP support such an amendment to an Act which ought to be repealed. The Reservation of Separate Amenities Act enables the CP controlled city council of Boksburg to do what they are doing. Therefore we say to the Government that if they do not want the CP to do what they are doing they must remove the ability to do what they are doing. [Interjections.] In other words, there is only one answer and that is that the Reservation of Separate Amenities Act must go. I think the Government ought to have the courage of its convictions and the honesty to go to the White electorate and say: This is an immoral Act and it must go.

One can mention the experience of one of our MPs, Mr J Douw, at the town hall of Klerksdorp. He arrived at the non-racial, integrated bus terminus—travelling together is no problem. He arrived at Klerksdorp at the bus terminus and looked for a toilet facility. The one toilet facility which was there was guarded by a huge White person who turned him away, saying that it was for Whites only. [Interjections.]

*Just imagine! And that happened in the only NP seat in the entire Western Transvaal. This is not a CP town, but an NP town, and a member of Parliament was told that he was not allowed to use the toilet facilities.

†There is also the question of the segregation of beaches. A lot of noise and propaganda was made over the fact that I demonstrated my objection to the separation of beaches, particularly King’s Beach. Hon members will also remember the 25 minutes given to the hon the State President in order to do what he tried to do to me, but the converse was really true. I think that I received more publicity than he because of what he did. We also saw the dismissal of Riaan Eksteen because of that situation.

Separate amenities and separate beaches still exist. According to a report in the Evening Post some of the beaches will now be opened. This includes King’s Beach. If my swim at least caused King’s Beach to be opened, then the swim and the castigation was worthwhile. However, the rest of the beaches are going to be reserved.

I happened to come across a report—hon members must not ask me how—by the appointed Jacobs Committee in which Mr Justice Jacobs himself gives a personal opinion with regard to this separation. He states:

*That is the chairman—

That is the Blacks—

And there were many of them—

Then the conclusions and recommendations follow.

It is important if one thinks about it, because it has happened in the past that the Government appointed a commission and then the findings and recommendations of that commission were simply shelved. The report goes on to state:

Hon members of the NP must listen carefully now—

We heard the hon the Minister using the word “just”—

This is what the commission said. The report goes on to state:

This is something else—

The report goes on in that vein.

It has also been mentioned that one of the obstacles to the process of democratisation and reform was the question of race classification legislation.

†We want to say again from this platform this afternoon that if ever anything was nonsensical in other words, that it does not make sense in the South African situation it is the law dealing with race classification, because it is completely artificial.

I want to refer to certain figures in the Department of Home Affairs’ report this year with regard to the reclassification of people. This is a mockery of race classification! The number of White people who were reclassified as Cape Coloured was 13. What makes a person a Coloured and what makes a him a Cape Coloured?

Then there is the reclassification of Cape Coloured to White. What makes a person a Cape Coloured? The Government talks about separation and groups as such. What makes a person a White? I am still looking for a definition of what it requires to be a White. I am still looking for a definition of what it requires to be classified as an Afrikaner. Why is the Government afraid and not prepared to tell me what an Afrikaner is?

*What is his culture? What is his background? Where does he come from? Spell this out in the South African context so that we may proceed from there. However, we cannot forever hide behind these halftruths and untruths!

†One Cape Coloured person was reclassified Chinese. Three Chinese people were reclassified White, although the Chinese language and culture is absolutely different. The number of Malay people who were reclassified White was 11. [Interjections.]

Malay to White?

Yes, it concerns the reclassification of Malay to White.

*The hon the deputy leader is not one of them! [Interjections.]

The reaction of hon members on that side and hon members on this side is a real reaction to a reality, and that is that the whole situation is ridiculous. It is ridiculous!

The Indian group is lucky, because there was not one White person who was reclassified Indian.

†The number of Indian people who were reclassified Cape Coloured was 52. They speak a different language, they have a different culture and they have a different background!

The number of Cape Coloured people who were reclassified Indian was 47. [Interjections.] My hon deputy leader is losing some of his people because 25 Malay people were reclassified Indian.

No people of the other Asian groups were reclassified Cape Coloured.

The number of Black people who were reclassified Cape Coloured was 240. Hon members see, just as some of our people try to be White because being White is valuable, right and a privilege, Blacks look at the intermediate step. To be Coloured means having a little more advantage!

The number of Cape Coloured people who were reclassified Black was 13.

Two Black people were reclassified Indian. Three Black people were reclassified Griqua.

The number of Cape Coloureds who were reclassified Malay was 24. Three Chinese people were reclassified Cape Coloured.

One Indian person was reclassified White and 19 Malay people were reclassified Cape Coloured. That represents a total of 867 people who were reclassified.

I do not know what the Government’s interpretation of genetics is in the first place, because genetics is a reality.

*Surely this is why some Whites are ashamed to be alive, because their hair is perhaps not straight enough. I remember they called one of the late State Presidents “Blackie” Swart because he was quite dark. I suppose if race classification legislation has to be applied, it has to start in Parliament itself. [Interjections.]

†It is important that we must develop a common loyalty; we must find that common bond which binds us and we must be able to say: “I am.” Those with a religious background, like the hon leader of the CP, will know what it means to get up and say: “I am.”

*The words “I am” represent a philosophy in terms of which one acknowledges that God made one a human being. I am, but the NP has classified me as a Coloured, and now it is a case of “I am Coloured”.

We reject this absolutely.

†We must develop a loyalty, a sense of oneness, in which we must be able to say: I am a South African.

I meant to deal with the rest of my proposals. Unfortunately, with apologies to those who already have them, I will in view of time have to end by saying that my party certainly is dedicated to the whole question of a federal structure. We have looked at the federal structure and we have said the only basis on which one can accommodate White fears and Black aspirations is on a non-racial—not ethnic as the Government believes; not an ethnic federation—geographic—there we have another difference with the Government; it cannot be an ethnic one only it must be geographic—state within a federal structure so that within that geographic entity all people will live in that entity as South Africans. We can then develop a national feeling in spite of being divided. This is the only way it can be done, and the possibility exists that South Africa can be geographically divided into 20 states but it is a mockery having these little patches forming KwaZulu and forming QwaQwa right on the top almost near Basutoland—a little almost enclave which says this is QwaQwa and so on. Consolidation means consolidation geographically and not ethnically and then we can talk in terms of a federal structure.

However, as I have said on a previous occasion I may be able to explain to and educate and edify some of the hon members on my right further as this will be my last major speech before the election I would like to remind all South Africans that hope springs eternal in the human breast. Without hope there can be no continuation of the struggle for human emancipation because one has to be unchained and unshackled I have to be unchained and unshackled so that I can discover my humanity in being myself and others can discover their humanity in being themselves and the enjoyment of full citizenship rights by all South Africans irrespective of race, colour, culture and creed.

As hon members go into elections on all sides we must never lose faith. Faith is defined as to be sure of the things we hope for and to be certain of the things we cannot see. One must never lose faith in oneself as a human being; never lose faith in other people as fellow human beings; and, above all, remember God is on the throne. Right is right and justice must prevail for He is God so do not lose faith.

I pray that the Spirit of God during this pentecostal season may renew our hearts and minds and understanding and lead us to establish a common bond, a common South Africanism lead us to one nation and one South Africa.

Mr Chairman, I listened attentively to the speech of the hon the Chairman of the Ministers’ Council in the House of Representatives. There are probably quite a few aspects about which one could fruitfully conduct a discussion.

To link up with one of his contentions, let me say that I do not think that he would argue the point if I said that I was a human being, but he apparently has some difficulty when I say that I am an Afrikaner. That seems to me to be a problem that he has. I have no problem with that.

What is an Afrikaner?

I do not need to explain that to hon members. If they do not know that, they are like people standing out in the sunlight and asking whether the sun is shining. [Interjections.]

The hon the Minister raised one point with which I agree.

Mr Chairman, would the hon the Leader of the Official Opposition in the House of Assembly take a question?

Order! Is the hon the Leader of the Official Opposition in the House of Assembly prepared to take a question?

No, I have a speech to make, and I only have 10 minutes. If the hon the Minister would please excuse me, I would prefer not to take a question now.

Order! The hon the Leader of the Official Opposition in the House of Assembly is not prepared to take a question now.

He is afraid!

Order! The hon member who said that the hon the Leader of the Official Opposition in the House of Assembly was afraid must withdraw it.

I withdraw it, Sir.

I agree with the hon the Minister’s criticism of the NP’s ambiguity and inconsistency. I think the hon the Minister indicated that last year the NP published a certain manifesto in which it clearly placed the responsibility for determining whether basic facilities should be open to other groups or not, squarely on the shoulders of town councils. That is what they are implementing, and they are doing so in the Strand and in other towns, as the hon the Minister indicated here. I do not want to elaborate on that any further.

I actually want to link up with my earlier argument during the discussion of this Vote when I intimated that I would like to speak about what the NP now accepts as its politics of negotiation, or where it places the emphasis in the politics of negotiation.

I think the hon the Minister—so it seems to me—has virtually unbelievable faith in negotiation. I do not blame him for placing very strong emphasis on negotiation, because I do not think it would make any sense whatsoever to deny the importance of or necessity for negotiation. It would be foolish to do so. As a political slogan, however, it is subject to the same objections as consensus politics. In his book 1999: Victory Without War ex-President Nixon made several valuable remarks about negotiation. he said, for example:

He went on to state:

And then he warned against the tendency to ascribe the differences with the Soviet Union to mere misunderstandings, which could be resolved by what he calls “a grand compromise”. He said that the conflict was rooted in extremely important ideological differences, differences in interests and objectives, and that, as far as that was concerned, negotiation could not bring lasting peace.

On the strength of these passages I have quoted, I want to suggest that the politics of negotiation is necessary and useful, but that it also definitely has its limitations. I have always thought that representatives of a specific people negotiate for the right of that people to self-determination without trampling the rights of other peoples underfoot. In South Africa these other rights must be fully and seriously acknowledged and promoted. In politics my party also has no hesitation whatsoever in saying—if we may direct our attention to the Coloured community and its leaders—that they are fully entitled to rights, privileges, freedom, etc. If one ignores the fact, however, that there is a diversity of peoples, an ethnic diversity, in South Africa, one is completely out of touch with the realities of this country. [Interjections.]

At the moment the NP is not protecting and guaranteeing own rights up to the very highest level. [Interjections.] The NP is now negotiating for a position in which self-determination has been disavowed in advance. The NP is now saying that it does not have a fixed, nonnegotiable right to an own Parliament and own residential areas.

I want to say the following about negotiation. If one regards ethnic or group diversity as a basic principle, and if the existence of one’s own people and its right to self-determination and its own legislative and executive authority, its own budget and its own physical space constitute a non-negotiable right, how does one negotiate with people who begrudge one’s people a separate existence, protective measures, their own political structures and their own physical space? How does one do that? [Interjections.]

Let me ask hon members what negotiation is possible between ethnic nationalism on the one hand and complete individualistic open democracy in the form of one man, one vote on the other. It is perhaps possible to agree to bring about political and physical separation—that is one possibility—or one allows mounting conflict to be incorporated in the system or one expects one’s people to capitulate completely. I think that is the choice one is faced with.

How does one negotiate the maintenance of one’s language as the official language if one has a unitary state with a numerical preponderance of people who do not know or want to know one’s language? How does one do that?

How does one negotiate about one’s national flag, which symbolises the history and origins of one’s people, with people who culturally and constitutionally disregard or are contemptuous of one’s people? How does one do that?

Yesterday the hon the Minister said that the NP wanted to get away from this obsession with numbers and believed that groups, and not merely individuals, should be the building blocks in the political process. He said that within groups numbers made a difference, but not between groups. Groups must carry equal weight in the decision-making process, regardless of their size. Groups carry equal weight and should have an equal say in decision-making.

Merely for the sake of interest I would like to ask the hon the Minister whether, per definition, the ANC is also such a group. Is that a group of people who, on that basis, can associate freely and consequently have a status in the process of negotiation in South Africa? [Interjections.] Surely that is free association.

[Inaudible.]

Oh please, the hon member for Turffontein really does not need to be that touchy.

We are now saying…

That is an Aunt Sally you are trying to knock down.

It is not; it is reality. Yesterday someone said in this Chamber that it made no difference; the ANC should be allowed full access.

If we are now saying that it is not a question of numbers, let us see how the NP deals with the numerical aspect in relation to the tipping of the applecart in the Johannesburg City Council. There is a Mrs Marx and a Mr Fabel. Mrs Marx thought that numerically she had the NP’s support, and then found out that that was a fable and that numerically Mr Fabel had their support! [Interjections.] That is what she discovered.

The hon the Minister says that groups must have equal weight in the decision-making process, regardless of their size. Let us now put this to the test in regard to a decision as important as the election of a State President and the composition of the electoral college. Is that not a very important issue? It involves, does it not, the election, to that post, of the man who decides about own affairs and general affairs. He is the one who appoints and dismisses Ministers. He declares war and peace. He is the one who told an hon Minister that he could not swim in a certain area. He is the one who said of an hon Minister in his Cabinet: “He happens to be a member of my Cabinet.” That is how important that person is.

Let me now say that if an Indian leader were to negotiate on that basis, ie that equal weight should be assigned to groups, surely the same weight is not assigned to the 13 members of his group and to the 50 members of the NP and the 25 Coloured members of the House of Representatives.

Labour Party.

Very well, the Labour Party. [Interjections.] Be that as it may, they represent the House of Representatives in that electoral college.

Surely he would be able to make out a case in support of his demand that there should be 13 Whites, 13 Coloureds, 13 Indians and 13 Blacks. He could rightly do so, or otherwise he could say: Very well, the Whites have 50 members, and the Indians, Coloureds and Blacks should therefore also have 50 members each. Surely that is the plain, down-to-earth reality we are dealing with.

Logical.

Yes. I am glad the hon member says it is logical.

But that is not the whole picture, is it. The Black people do not constitute a single group. Everyone acknowledges that to be so. Try to put the Tswanas and the Zulus into one group—surely they are not one group. They are different peoples.

There are six self-governing states, and there are Black metropolitan areas and groups that the Government wants to include in its national council and in this forum. What would equal weight then look like for those groups? Let us again take 13 as the norm. There are 13 Whites, 13 Coloureds, 13 Indians and then at least 13 times six Black groups. [Interjections.] Then the Whites are in the “powerful” position of a 1:8 ratio, or 13:104, or even better, and closer to reality, 1:10; ie 13:130. That is, if there were consensus about equal weight being assigned to groups. [Interjections.]

Our next question is how consensus would then work. Thus far we have voted, and voting takes place. Surely there is no consensus. [Interjections.] When a speaker was elected for Parliament, hon members of the LP to my left put up their own candidate, and that candidate drew 36 votes, as against the 52 of the NP candidate. Voting took place.

Even if one only took the existing system and augmented it—50, 25, 13 for the 5 million Whites, the 3 million Coloureds and the million Indians—and one only added the Zulu people’s 6,5 million on the basis of proportional representation, the following picture would emerge: 25, 15, 13 plus 65. If those people had to elect a State President for the country, and people were to agitate to have Nelson Mandela available for election, Nelson Mandela would be a presidential candidate, or Buthelezi would be a presidential candidate.

That is correct!

If he were to be elected State President, let me tell the hon member here to my left that he could appoint Sam Nujoma as Minister of Defence! [Interjections.] [Time expired.]

Mr Chairman, it is a pleasure and a privilege to be able to make a few concluding remarks as the last speaker in this debate. At the same time, however, I wish to react to certain specific spokesmen and to reply to certain questions that were asked regarding the responsibilities which I share.

Let me react firstly to the speech made by the hon the Leader of the Official Opposition in the House of Assembly. Surely I am correct in saying that the statement he made to the effect that the NP or the Government were staking a claim in respect of negotiation politics, is not true. [Interjections.] Surely there are many other parties here that are staking a claim with regard to negotiation. If I heard correctly, a member of his party, the hon member for Ermelo, said yesterday that they would have to negotiate in order to implement partition. That hon member did say that.

With whom?

Yes, that is the question, with whom? Surely it is nonsense to allege that the Government is staking a claim in respect of negotiation politics. I want to repeat my question to the hon member for Brakpan, who is waving his hand about like that, as to how he is going to succeed in implementing partition. This will only be able to take place in accordance with one of two methods. One must either negotiate in order to have it accepted, or one must shoot and force people to accept it. [Interjections.] It is one of the two; there is no other option. [Interjections.]

Order! No, the hon member for De Aar and the hon member for Brakpan must put a stop to their altercation. The hon the Deputy Minister may proceed.

I should like to ask the hon the Leader of the Official Opposition in the House of Assembly how one is going to keep one’s standpoint alive in South Africa if there is no acceptance of it. If one has a minority acceptance of it in one sector of the community—the White community—how does one expect to keep it alive among other communities in South Africa and among the entire population if there is no acceptance of it? If one does not have an acceptance of it, there is only one way in which one can bring about an acceptance, and that is by negotiating about it and convincing people of one’s standpoint. That is, in fact, the method one must then adopt. If the hon the Leader of the Official Opposition in the House of Assembly says that he does not agree with that, then there is only one other conclusion to be drawn from this, and that is that he wishes to follow the path of violence in order to enforce that solution. [Interjections.]

The hon the Leader of the Official Opposition also referred to Johannesburg, but I do not think it is worth his while to refer to it. He referred to yesterday evening’s voting in the Johannesburg City Council and I shall merely make the following interesting observation now. If my information is correct and one counts the votes, then two of his councillors voted for one Nationalist and two of his councillors voted for the other Nationalist. [Interjections.] If the CPs in the Johannesburg City Council were so consistent, then surely they should have abstained from voting with regard to this matter, something which was their prerogative. However, they did not wish to do so, and this is typical of their little games.

Before I make one or two general remarks, I should like to react to certain specific matters which lie within my sphere of responsibility. The debate on group areas relates in essence to the provision of housing to the various communities and the identification of land for this purpose. We are all in agreement that the emphasis in this regard falls particularly on the housing shortage in the various metropolitan areas. We are also in agreement that people of colour have a need for alternative housing, which ought to be situated more favourably in relation to the metropolitan centres. The location of job opportunities plays an extremely important role in this regard. In my view this situation may best be addressed by way of a plan of action, which comprises the following.

Firstly by systematically devoting attention on an urgent basis to the provision of land and appropriate housing for the various communities. The fact that more than 65 000 hectares of land, 27 000 hectares of which were identified during 1988 alone, have been identified for Black township development during the past three years, illustrates the good progress that has already been made in this regard. During the past year some 7 000 hectares of land have been identified for Coloured group areas and approximately 1 500 hectares for Indian group areas.

Secondly, by way of the identification and designation of free settlement areas with regard to both undeveloped land and existing residential areas which are favourably situated in relation to job opportunities.

Thirdly, by the issuing, on a well-considered basis, of permits to disqualified persons in terms of the provisions of the Group Areas Act.

This is the point of departure in order to ensure in the future, as regards the handling of transgressions of the Group Areas Act—where the eviction people may be considered—that the reported cases are dealt with with great compassion. An attempt will therefore be made to resolve the cases concerned on the basis of persuasion, without the intervention of the law.

In this regard the particular needs of the disqualified persons will have to be taken into account as far as possible and an attempt will have to be made on the basis of negotiation to offer such people suitable and acceptable alternative housing, possibly in free settlement areas.

The Government has consequently decided to establish a central housing component in the Department of Public Works and Land Affairs in order to provide housing aid, in consultation with other interested Government institutions, to disqualified persons who have to be provided with alternative housing. Preference will therefore be given to making use of a negotiation process in order to deal with this sensitive matter.

I must emphasise that it is beyond the power of the authorities at all levels to assure transgressors of the Group Areas Act that it will, in fact, be possible to arrange acceptable alternative housing. Therefore, whilst the Government is applying the Group Areas Act with compassion and, wherever possible, is striving towards the establishment of housing options within the open market system, the capacity in respect of the expansion of a central housing component is limited and directed at those cases in which local options cannot easily be exercised.

Both the hon member for Green Point and the hon nominated member Mr Abram referred to the need that existed for political representatives and other private persons to be able to come forward with proposals with regard to possible free settlement areas. There is no reason why such proposals cannot be brought to the attention of the Free Settlement Board by the local authority, provincial administration or Ministers’ Council concerned.

Furthermore, the statement was made that free settlement areas would apparently be established only in a selective way. That is not correct. I do not think there is any reason for such a conclusion. In any event, we are beginning to implement this process. I wish to emphasise, however, that individuals and local authorities in particular are at liberty to request investigations into free settlement areas.

The hon the Deputy Minister of Population Development referred to the need that existed for agricultural land to be made more freely available. The Government is fully aware of this need, and attention is presently being devoted to it. I wish to point out that the Free Settlement Areas Act could also possibly play a role in this regard.

†The hon member for Johannesburg North referred to various issues relating to the upgrading of existing informal settlements, the acceptance and furthering of informal housing, and site and service schemes. In view of my limited time in this debate I will at this stage reply only briefly to these issues.

Prior to the upgrading of an informal settlement its situation in terms of land usage and other criteria must be considered. It is in fact Government policy to promote informal housing in areas designated for this purpose. Informal structures are also found in existing towns.

It cannot be expected of the Government merely to condone illegal settlement on any land, be it private or public land. Specific areas could be identified for informal towns with permanent housing and where people could erect their own dwellings which may initially be of a moderate format. Depending upon the available funds the relative authorities will provide land with lay-out plans and provide basic services. An individual will be able to erect his own structure according to his own means and improve it as he and his family’s positions improve.

However, it must be borne in mind that nobody is entitled to a free site, home or services. Assistance may be rendered in cases of indigency, but the basic principle of user charging remains applicable.

The structuring of subsidies from the National Housing Fund is such that all segments of the lower income groups of the communities are catered for. Provision has been made for rights of tenure, namely leasehold and ownership. It is also Government policy that service sites rather be provided than housing units. This applies to formal and informal township development. For the 1989-90 financial year an amount of R210 million has been earmarked for the servicing of 17 500 sites.

The hon member for Johannesburg North also enquired about the position at Weiler’s Farm and Orange Farm. Provision has been made for 1 200 residential sites with basic services at Orange Farm to accommodate the people of Weiler’s Farm. Although the immediate response has been somewhat slow a daily average of eight families is being assisted to acquire sites at Evaton North and at Orange Farm. So far 277 and 42 families from Weiler’s Farm have taken up residence at Orange Farm and Evaton North, respectively.

Regarding the question of the hon member for Johannesburg North about further amendments to the Prevention of Illegal Squatting Act of 1951, I must point out that the issues raised in the findings of the report of the President’s Council were duly considered during the drafting and consideration of the amendments to the principal Act. In reconsidering the issues as proposed all the relevant organisations are to be consulted. This is being done and any amendments will have to be considered at a later stage.

The hon member also enquired about the steps that were taken to ascertain that the areas west of Soweto are safe for urban development. To determine the development potential of the area west of Soweto a task group took all relevant factors including inputs from the communities concerned, land owners, mining companies and other institutions into account.

The major issues that were investigated were the de-watering of underground compartments, the occurrence of dolemite, mineralisation, present and future mining activities and, specifically, shallow undermining. This task group concluded that of the initial area investigated an area of approximately 3 100 ha is possibly suitable for township development.

To ensure that each portion of land indicated for township development would be safe for such development it was stressed in the statement of 5 December 1988 that further detailed geological investigations would have to be carried out to the satisfaction of the Department of Mineral and Energy Affairs and the Transvaal Provincial Administration in order to determine the suitably of specific sites for township development.

*I have already replied to a question asked by the hon member for Losberg with regard to Suurbekom. He also asked what the situation was with regard to squatting at Port Nolloth and I want to furnish the following information in this regard: The municipality gave the squatters notice to vacate the area, but some of the squatters disputed the legal validity of this notice in court. The court ruled in favour of the squatters, but an appeal has been lodged and the case is therefore sub judice at present. The municipality has undertaken to obtain legal advice with a view to action against potential new settlers.

†I wholeheartedly agree with the hon the Chairman of the Ministers’ Council in the House of Delegates and the hon member for Umhlanga when they highlight the problems associated with the identification of land for urbanisation, particularly in the Durban Functional Region. As they are aware, ongoing discussions have been proceeding toward satisfying the short-term needs of this growing metropolitan complex.

To assist in orderly long-term development the hon the Minister and I have for some time now been in consultation with both the Administrator of Natal and the KwaZulu Government with a view to the appointment of a joint task group to formulate a strategic development framework for the Durban Functional Region.

Hon members also know that three deconcentration points around Durban have been foreseen ever since the Regional Development Programme was renegotiated in 1982. The full deployment of these initiatives will surely follow as the development framework for the subregion becomes available. In the same context Richards Bay is still the decentralised growth point with a considerable growth momentum based on its inherent competitive advantages. Such new urban complexes do not explode overnight and the Government is most satisfied with the success of its regional initiative and the way in which the private sector has grasped these opportunities in the establishment of a diversified economy in a future metropolitan framework.

As far as the enquiry of the hon the Chairman of the Ministers’ Council in the House of Delegates regarding Pelikan Park is concerned, I must point out that the delay in township registration has nothing to do with the Group Areas Act and its administration by this department. Township registration is the responsibility of the Administration: House of Delegates.

*The hon member for Umhlanga also referred to the devolution of advice as manifested at present in the regional development associations, the regional development advisory committees and the National Regional Development Advisory Council. I should like to give the hon member the assurance that these structures are playing and fulfilling an increasingly greater role in regional development.

The hon the Leader of the Official Opposition in the House of Assembly referred to a matter relating to Thabazimbi. There has been correspondence between the hon member and myself. Together with him, I met a delegation of the people of Thabazimbi. There has also been correspondence between him and the Transvaal Provincial Administration with regard to this matter. I confirm that according to my information a letter from the Provincial Secretary was handed to him as recently as 5 May, but also earlier on 19 April, which fully set out the Provincial Administration’s standpoints with regard to township development in this regard. If the hon member denies that he received a copy of this letter, I shall be pleased to furnish him with a copy of it. I have here a copy of the letter that was addressed to him. I am not sure about the date, but it is a reply from the Provincial Secretary of the Transvaal to a letter of his dated 27 October 1988.

I should like to make one or two remarks about the speech made by the hon the Chairman of the Ministers’ Council in the House of Representatives. At the beginning of his speech the hon the Minister made certain general statements with which we naturally agree. The hon the Minister made a statement which related to the important realities of reform.

†He said, inter alia, that realities demand patience and then he posed the question: “For how long?”

*I wish to agree with that. Realities demand a great deal of patience from all of us in South Africa. When we talk about constitutional, social and economic reform, a great deal of patience is required of all of us in order to apply it.

The hon the Minister also asked us a valid question when he inquired what our timetables were in this regard. I do not wish to attempt to give an answer to that. All of us have to work together in an effort to provide that answer. One thing is true if we are attempting to provide an answer to this, and that is that in the first instance we must decide whether we are seeking an instant solution in the short term, or whether we are seeking a permanent solution, which will in the final analysis comply with all the demands of South Africa and which will be able to satisfy the needs of us all. That is what our objective ought to be. I want to make so bold as to say that I think this is also the objective of the hon the Minister and his administration in this regard, namely that we must seek solutions which are permanent and fair and just for everyone in South Africa.

†The same would apply as far as the social reform process is concerned. In this regard we can refer time and again to Acts like the Population Registration Act, the Reservation of Separate Amenities Act and the Group Areas Act.

*The hon the Minister is correct in saying that the hon the Minister of Constitutional Development and Planning has already indicated in this committee that these Acts must be addressed. These are, of course, aspects which are often highlighted by people as being stumbling blocks on the path of negotiation. When we talk about social reform, we are also dealing with a natural evolutionary process, just as with constitutional reform. The Government naturally has the responsibility of directing and managing this.

It is in that light that our announcement this afternoon with regard to the transfer of certain functions which relate to the aforementioned three Acts must be viewed. It is also in that light that the steps we are taking with regard to the envisaged implementation of further campaigns regarding the Group Areas Act must be viewed. We do indeed wish to gear ourselves to addressing and alleviating the housing requirements and the housing shortage.

I think it bears the stamp of a competent management approach with regard to moving away from discrimination and, ultimately, the achievement of our social objectives as well, on the path of social reform.

One thing that this debate has produced and to which I must refer, is the overemphasis of groups on the one hand and of the existence of non-groups on the other. Both contain basically unrealistic approaches. The existence of groups and communities in South Africa is a reality, and I need not repeat what the hon the Minister said in this regard. When one listens to right-wing debates and statements, and to left-wing debates and statements, one sometimes gains the impression that no such thing exists in South Africa. The overemphasis and exaggeration of this naturally represents a totally unrealistic approach.

Likewise, the tendency to underemphasise or ignore them is also an unrealistic approach. The hon the Minister says there can only be such a thing as a geographical federation. It is a pity he is not here now, because I should have liked to ask him, if his party says that their federal approach makes provision for 20 states…

That is a hypothetical figure.

Oh, it is a hypothetical figure. But then the question could just as well be asked as to why it is not four. Why, then, is it not the four provinces, for example? Why the figure of 20? Regardless of whether it is a hypothetical figure of 20 or whatever, what will the borders of those states be? Will one not in any event also find phenomena occurring in those states which are concerned with groups and ethnicity? Interjections.]

My time has virtually expired and I should like in conclusion to dwell for a while on the hon member for Lichtenburg. He made certain statements in the committee and I think it is necessary to react to at least three of them. Firstly, the hon member said that the standpoints which the hon the Minister had adopted on behalf of the Government and the NP in this committee on Friday, were precisely the same as those of the DP, except in two respects—one difference is that of 10 years and the other that of the “must” and the “do not want to”. That is the only difference between the standpoint of the NP and that which the DP will adopt. Surely that is not true! It is clear to me that the hon member was not present throughout this debate, or in any event not on Friday. The hon the Minister delivered a speech in this committee on Friday and spelt out the standpoint of the Government, which presupposes a unique federal democracy for South Africa.

The hon member for Randburg delivered a speech which very clearly spelt out the fact that his party stood for a system of one man one vote, and in reply to a question by the hon member for Caledon he answered frankly: “A unitary state concept”. Surely that is very clear. It is very clear to the hon member for Lichtenburg and to all hon members that we are dealing here with very clearly distinctive constitutional systems. However, the hon member fails to see that. He is making this sort of untrue allegation for his own political purposes. [Interjections.]

Secondly, the hon member asked certain questions regarding the choice of a State President in the proposed dispensation of which the hon the Minister spoke. The hon member is apparently evading the fact that we are talking—the hon the Minister said this specifically in his speech—about the whole question of how the executive authority, the position of the head of State in itself, must also be investigated in accordance with the role which he must fulfil in a new dispensation. This in itself naturally presupposes the specific method with regard to choices that have to be exercised.

The hon member advanced a simplistic argument. He set up the Aunt Sally and promptly attempted to shoot it down himself, as if the role which the State President must fulfil, and the manner in which he must be elected were the only one in which a State President of South Africa could be elected.

Tell us what your plan is.

The hon member may feel free to read the speech made by the hon the Minister on Friday, then he will discover the answer for himself.

Thirdly, the hon member for Lichtenburg drew attention to the question of the formula which, in the final analysis, is the NP’s, and with regard to which negotiations must take place. Then he said that the voters would have to make a choice on 6 September and that thereafter they would never again be given an opportunity to express an opinion on the details about which negotiation must still take place. That is complete and utter nonsense. The Government has repeatedly given the assurance and the undertaking that whatever model is ultimately found to be accepted, after the negotiation process, will naturally have to be tested among the various communities in order by so doing to ensure the maximum possible acceptance among all communities in South Africa in order to have a constitution succeed. Surely it is only logical that in the final analysis one cannot introduce a new constitution in South Africa without being certain that it is at least acceptable to the majority of the various communities in South Africa. This means that is must be tested by way of a referendum, an election, or whatever the case may be.

In conclusion I come to the hon the Leader of the Official Opposition in the House of Assembly. He availed himself of a second turn to speak this afternoon. Many members of his party, including hon members who normally speak on constitutional matters, have taken part in this debate. Not one of those speakers, neither the hon leader, nor any of the others, has given any indication whatsoever at any time during their participation in this debate, as to what they mean by partition, how they wish to implement it and what they are going to tell the voters, with a view to the Parliamentary election, about how partition will look in reality in South Africa. We have been waiting for four to six years for that answer. [Interjections.]

I draw only one conclusion, and that is the statement I wish to make. After all, we told them, as early as Friday, that two days lay ahead and that they should give us the opportunity to hear what their plan was so that we could evaluate it. [Interjections.] We have not received it. There is only one conclusion one can draw, and that is that the hon the Leader of the Official Opposition in the House of Assembly and his party do not have a plan.

It is easy to say “partition”, but the voters will receive an opportunity on 6 September to make an evaluation of whatever substance that plan may have. [Interjections.] I say that party does not have a plan. If it had one, it has had an opportunity for three days to spell it out, and that has not happened.

The hon the Minister began this debate with a very interesting speech which set the direction of this debate, but also of the future of South Africa and this country. I think that this debate will ultimately at least bear the stamp, not only of what has been said and what has noticeably not been said by certain parties and people, but also of an interesting speech which was made on 5 May and which, according to my expectations, will go down in the annals of South African history as a speech of profound significance which set the direction, not only for the NP and the Government, but also for the country and all its people. On the strength of this we can find a basis upon which we can unite and co-operate and in terms of which we can indeed take the majority of the people in this country, which, according to all the indications, comprises 80% of the country’s total population, along with us on the road to a peaceful, just and fair South Africa.

Debate concluded.

The Committee rose at 18h37.

Mr Chairman, in the light of the Government’s declared policy on privatisation and deregulation, I am glad to see that the Government has decided to convert Iscor into a public company and to dispose of the Government’s shareholding in Iscor.

The purpose is, firstly, to reduce the Government’s interest in the economy.

Order! No, hon members must not talk so loudly.

Secondly the purpose is to grant the private sector an opportunity to acquire interests in this capital-intensive industry and to acquire unrestricted control over the activities of Iscor. To give effect to this decision, statutory provision has to be made for the conversion of Iscor into a public company. Consequently provision must be made for the disposal of the State’s interests in Iscor.

I am not at all happy with this. I am glad to see that the State is, in fact, proceeding with privatisation. I would appreciate it if the hon the Minister would give us the assurance here today that the large consortiums are not going to gain control of Iscor. It would serve no purpose to privatise and then have the large companies gain control of Iscor.

I propose that preference be given to the workers of Iscor when it comes to obtaining some of the shares. I think that hon members will agree with me when I say that it is thanks to the workers that Iscor has developed into such a gigantic enterprise. Why should we specifically forget about them now? When we privatise we must bear in mind that we must always protect the interests of those who are less privileged.

I want to put the following question to the hon the Minister: What is going to happen to the R5 000 million the State will receive when the shares are sold? Will it be paid into the State Revenue Fund? I hope the State is not going to use the money to pay off overseas debt. When the hon the Minister of Local Government and Housing in the House of Representatives approaches the hon the Minister of Finance for funds, the problem is that there are not always enough funds. The State is now receiving R5 000 million in this case, and hopefully a portion of this will also be put at the disposal of the hon the Minister of Local Government and Housing in the House of Representatives.

Mr Chairman, may I at this stage record the CP’s objection to the arrangement of today’s proceedings. While a Vote is being discussed elsewhere, we have to proceed with the discussion of legislation here in another Chamber.

†On the question of the Bill to convert Iscor into a company I would like to mention that in another debate last Friday the hon the Minister accused me of being a Scargill and of talking like the Labour Party in Britain—a sentiment he echoed after it was raised by the hon member for Pinetown, who is not in this House. I can forgive the hon member for Pinetown for not understanding the matter but the hon Minister’s comments are totally unforgivable.

Is the hon Minister trying to tell us that he does not understand the difference between national socialism and the CP’s policy? Surely he understands that it is the British Labour Party and national socialism that nationalise instances in the private sector. If he does, then he will also understand that what the CP stands for is exactly what the NP supported and boasted about on numerous occasions before they dreamed up this new scheme to sell the assets of the White nation so that these would be used so that there would be more to spend on nonproductive socialism as advocated by the NP.

When did Eskom, Iscor and the transport and communications services ever belong to the private sector? Until Sasol was privatised away to the private sector, it was a State developed function. I cannot accept that the hon the Minister could not understand this. I must then ask whether the hon the Minister tried to mislead the public just to score a couple of political points against the CP or whether his intention was perhaps more malicious than that. Was he hoping that his Press lackeys would draw the comparison or was it for that little newspaper of the NP, the so-called Die Nasionalis, so that they could publish some more rubbish.

As far as this Bill is concerned, it has to be approved before the Bill to privatise Iscor can be approved, could it be that or does the hon the Minister intend rather going ahead with the privatisation of Iscor on the basis of this Bill? It is not clear in the documentation before us. If this is the case then we have serious reservations because our acceptance would then be given on a blank cheque basis and we are not prepared I repeat, we are not prepared to give that hon Minister or his Government a blank cheque for anything. We have already seen what happens to voters who do this.

We want certain assurances regarding the interests of the employees of Iscor. We are not prepared to allow them to be sold down the river to big business. We want to know whether they will be allowed to buy shares and that they will have the first option. A free allocation should also be arranged on the basis of years of service by the employees if the hon the Minister is so determined to do this. We also want a commitment that after the staff have had the first option, the next sector in line for preferential treatment will be the small investor. We want an assurance that this can be expected. We also want the NP Government, through the hon the Minister, to meet their promises of the past and I refer to a report in The Argus of Monday, 8 February 1988, reporting an address by the hon Deputy Minister of Finance, Mr Durr, in which he talked about the fact that the Government was determined to see through its plans to privatise Eskom, the Post Office, the SATS, Foscor and Iscor. He was addressing an international convention in Cape Town on the political economy in South Africa.

He said that one thing was for sure, namely that the proceeds of privatisation would not go towards meeting State expenditure, but would ideally be used to reduce the public debt or, as a second choice, to provide infrastructure and services in developing areas and to create capital funds to assist small businesses. However, he says that the private sector will not rule the roost when and if major State corporations are privatised. The Government will remain the controlling shareholder. We shall be interested to hear from the hon the Minister how he intends achieving this in terms of the sale of shares.

Our information has it that the hon the Minister intends restricting the private sector, in terms of large corporations, to a 20% share in Iscor. In other words, they will not be able to buy a block larger than 20% of the shares. However, all we need is three of the big four corporations in South Africa let us say Sanlam, Anglo American and Rembrandt blocking together for three corporations to control 60% of the shares, unless, of course, it is the intention that the majority of shares stay in the hands of the Government. However, we do not know whether this is so and this information is not presented to us in terms of the legislation in front of us today.

We all know that in the first instance Iscor was developed for strategic reasons and to provide employment. However, that was done at a time when big business was not interested in doing this sort of thing because they did not have the guarantees. I can see their keenness now to privatise Iscor.

If one looks at the latest report from Iscor, it is comparable with that of any top company in this country. From the report it is quite obvious that Iscor already makes a big contribution to the State. In the latest report, for example, taxation amounts to R92 million. The State as major shareholder is also the major beneficiary in terms of dividends paid. In this report that is an amount of almost R65 million, so we want to know what the benefits of privatising Iscor will be. Instead of benefitting the economy, privatisation in this instance will mean siphoning off much-needed capital which is available to provide employment which already exists. I would be very interested to hear what the benefits will be to the country in terms of the privatisation of Iscor before we make a final comment as far as that is concerned.

There are certainly some reservations, not only from us but from other areas as well. Assocom, for example, supports the privatisation of Iscor. However, what we would also like to know is who is being consulted in terms of the whole concept of privatising Iscor. Have the trade unions been consulted? Have the employee unions at Iscor been consulted? If so, what have been their comments? Has what is going to happen to Iscor prior to or after privatisation been presented to them? I think it is very important for us to know that before we can comment even further.

I think I have covered the national socialism and I do not think we need to make any more comment on that subject. One thing that concerns me is the fact that the president of the Public Servants’ Association, according to today’s Citizen, gave a “no sweat, no panic” assurance to the country’s corps of State officials following the revelation over the weekend that privatisation would affect 60 000 jobs.

I have also seen justifications for privatisation appear in the telecommunications in-house publication. One wonders if it is perhaps a case in which “the lady doth protest too much”. We would like assurances regarding the information for which we have asked.

When one looks at the figures produced over the past few years—as long ago as the 1983-84 financial year they were doing a fantastic job—I believe that the twenty years that lie ahead of us will be even more favourable to the steel industry than the present, especially when one considers the development taking place in large areas of the eastern bloc such as Russia and China.

I am just wondering whether there is any need for the privatisation of Iscor in view of the fact that for at least the next twenty years Iscor will in any case be riding on the crest of a wave.

Mr Chairman, the object of the Conversion of Iscor, Limited, Bill is to convert Iscor from a State-owned institution to a public company in terms of the Companies Act. This is in keeping with the Government’s declared policy on deregulation and privatisation. I want to welcome this process because I believe it is part of the reform process in this country as it affords everyone an equal opportunity to purchase the shares. The Minister is empowered to exercise the rights of the State and dispose of such rights. I am told that the company will be listed on the Stock Exchange, will trade and will be liable for tax as is any other company. The public can buy shares or purchase any component of the company’s assets.

In the joint committee we were assured that the Government and the hon the Minister would ensure that the disposal of these assets would be effected with the utmost care. My only concern is that the hon the Minister has to watch the movements very carefully in order to ensure that there is no abuse and that the State coffers will gain the maximum from the sale of assets, at both the market value and the protected market value. I refer to the protected market value because, as the previous speaker has mentioned, Iscor is at present looking forward to a boom period in their steel and steel products. We need to develop finished products in this country because at the moment we are selling our steel overseas and buying the finished products. If Iscor embarks on this as a company it will be able to afford a lot of opportunities for employment. This will also save currency in the balance of payments by retaining money in the country rather than spending it overseas.

I would also like to see the employees benefit from this change. I would not like big business consortiums to take up this privilege and dominate the scene by buying up Iscor, but I was assured in the joint committee that adequate safeguards would be taken to ensure that even overseas companies do not purchase Iscor in its entirety. Solidarity has no objections to this Bill, we welcome privatisation and this new deal and therefore I support this Bill.

Mr Chairman, after thorough discussion this Bill has been approved unanimously by the joint committee. The numerous questions of hon members have in the first place been answered outstandingly by the officials of the privatisation unit, as well as by the Iscor management. We want to thank them for the assistance they provided us there. This made it possible for hon members to consider the principles of the whole action thoroughly and reach a unanimous decision. This Bill should not be seen in isolation but should rather be seen as part of the process of privatisation.

The Government is hereby giving effect to its general point of departure with regard to privatisation, namely the systematic transfer of functions, activities and property from the public to the private sector, of course with the aim of curtailing and lessening the State’s interest in the economy while the private sector acquires free control over these activities. There should not be any further arguments about this.

The hon member Mr Derby-Lewis mentioned a few matters that were totally unfounded, and I will shortly refer to that. However, I am somewhat impatient about the fact that we are not making enough progress with these aspects of privatisation. I will soon return to this.

I further believe that the heavy, insensitive hand of the State in our business life and in the pocket of the man in the street should be removed as soon as possible and should make room for the operating and regulating of business by the market mechanism.

I am very much aware of the fact that privatisation will in itself not be a miracle cure for economic growth and progress, and it will never be. However, it is the best possible manner to organise the economy in the long term, provided it is part of a general economic strategy, as it is in our case.

The activities of Iscor belong in the private sector and not in the public sector. What is very important, however, is the scope of this action, which should be the forerunner and which will have to serve as an example. As hon member already mentioned, the corporation was established in 1928 and the aim then was that there should be a private shareholding. This aim was not realised. Iscor did, however, succeed in managing its business successfully with a profit motive in an extremely competitive sector. This corporation is presently very healthy and is managed in an excellent manner.

The decision of the Government to take this step in regard to Iscor, is in my opinion supported everywhere. I wish to refer to the commentary of Assocom as reported in The Argus of 9 February.

†The headline is “Assocom gives backing to Iscor privatisation”. The article reads as follows:

The reason for this, of course, was the capital situation which could come under stress.

*There is however also another side of the coin. I think the best example of this is an article in the Cape Times of 14 February under the heading “Privatisation RIP”. The article reads as follows:

†Later they quote the hon the Minister for Administration and Privatisation as saying:

My comment in response to this particular article is: Humbug. The Government has indicated that their intention is to float all Iscor’s shares. The hon the Minister was certainly only suggesting that the Government’s perception at this stage is that it can do no more than is said in that article. The attitude of the Government is clearly to divest themselves of the shares. However, as Assocom pointed out, it neither can nor should be done immediately. Instead it should be a progressive disinvestment over several years.

*A few matters are still up in the air, and will probably remain there until such time as the shares are issued, seeing that there is a perception among the public that a public monopoly should not be converted into a private monopoly.

This fear exists. Whether it is justified or not, is another matter altogether. I say the Government is well aware of this and is dealing with it. The viewpoint that shareholding would be restricted and that in this connection foreign shareholding as well as domestic shareholding would be attended to, was clearly stated during the discussion in the joint committee.

The Government is undoubtedly aiming to acquire as many individuals as possible as shareholders, including workers who are to be granted the opportunity to participate. As this will be an extremely large flotation, it will be important to obtain future public support for the idea of privatisation.

Shareholders tasting success, will as a matter of course be a great help in supporting the idea of privatisation and deregulation in general. If this flotation is handled carefully, which I feel certain will be the case, we should receive many positive reactions from this.

I wish to conclude by saying that there is still ample opportunity for far larger privatisation campaigns, especially in regard to third-tier government. With this evident success we can lend very great momentum to the whole campaign. We on this side of the House support the legislation.

Mr Chairman, the DP will support this Bill as we are in favour of the general principle of privatisation and this is an important step in that direction. However, as spelt out in the joint committee discussions, we do have a number of important reservations about the specifics of this Bill, which I would like to place on record.

Firstly we regret that the Government has not bound itself in this Bill to dispose of the majority of the shares in Iscor Limited. In terms of clause 6(2) the Government is given carte blanche to dispose of the shares without any prior commitments in respect of majority control. The very least that I would hope for in this debate is that the hon the Minister will make such a commitment and place it on record.

If the State does not eventually sell the majority of its shares to the private sector, then they will not have privatised Iscor. They will merely have absorbed a considerable amount of private sector capital into a State enterprise. To sell only a minority holding in Iscor will be a perversion of the privatisation principle. We must make that absolutely clear because if it turns out in due course that the majority has not been sold, we will strenuously oppose that.

I would like to answer the hon member for Uitenhage, who complained of a public perception. Let us accept that it is a widely held public perception and I need only refer to an article which appeared in the Financial Mail of 10 February 1989 in which they refer to privatisation under the heading “A year of nothing but talk”. They make the following statement:

That is going to be the test. That is the attitude at the moment for which the Government itself must carry the blame, and it is up to the Government to put that perception right. In the end the only way to put it right is for the Government to show through its actions that it is prepared to relinquish majority control.

The second reservation we have in supporting this Bill is that we oppose clause 8 as presently formulated. It provides for the proceeds of the sale of Iscor shares to be paid into the State Revenue Fund. I believe that it would be a travesty to use the money generated from privatisation for current expenditure purposes.

It is a basic principle of sound economic management by businesses or by individuals that one should not live on capital. In colloquial terms anyone who sells the family silver to help pay the rent and the grocer is heading straight down the drain.

The DP believes that the proceeds of privatisation should be paid into a capital fund a capital projects fund, or whatever one may want to call it, the proceeds of which should be used basically for capital and infrastructural purposes, particularly such things as the building of schools. We would also include the reduction of the national debt and small business development as valid uses of privatisation money. I would therefore call for the creation of such a capital fund into which privatisation proceeds can be paid. Indeed, if it were possible we would have moved an amendment to that effect to this Bill.

The creation of such a fund will create an important disciplinary measure against which to test what the Government does with the money. It is all very well to say that it all goes into one pot and that one can see how much has gone in and how much is eventually spent from year to year on capital projects, but that is not the same thing. We have a State Central Energy Fund; we should have a State capital fund for this purpose. Then we can easily assess from year to year what the Government does with the money.

This call is not in conflict with the intentions as set out in the White Paper on Privatisation and Deregulation, nor is it in conflict with the explanatory memorandum issued with the 1989 Main Budget Speech. Indeed, I find it strange, in the light of these stated policies, that the Government itself has not initiated the creation of a separate capital fund.

My third reservation about this Bill concerns its failure to address the issue of what the future ownership composition of Iscor should be. The DP would like to see the privatisation of Iscor as part of a process leading to a broad-based non-racial share-owning democracy in South Africa. Viewed in this light it would serve no useful purpose whatsoever if Iscor Ltd in future were to be controlled by the Government on the one hand or by one or two major private entities on the other, or indeed by foreign interests. I would therefore like to see the articles of association of Iscor Ltd drawn in such a way that future ownership can be restricted so that no single entity or group of entities should control more than a maximum of, say, 20% of the company.

Regarding the question of target dates, I would like to have on record some indication of target dates for the flotation process and for the end result. I would also like some indication of what the State may hope to realise from these proceeds.

The issue of timing is also terribly important. Once one has sold a share, it is sold. It is a once-off receipt for the State and that is it. After that there is merely the taxation share of dividends and profits. The issue of what capital amount one will get for one’s share when one sells it, is of the utmost importance. With great respect, a corporation whose net assets are valued at, I believe, some R5 billion, should be making more each year than an annual pre-tax profit of only R600 million. Of course the pre-tax profit of any entity determines what one can get on the stock-market in the public flotation for that share. These are issues I hope we will hear more about in the hon the Minister’s reply.

With these reservations, we support the Bill.

Mr Chairman, as a result of the Government’s policy on privatisation and deregulation the decision was made to convert Iscor into a public company and also thereby to lessen the State’s interests. The company will fall under the same Act to meet the requirements of a public company and will also have to comply with the provisions of the Companies Act, Act No 61 of 1973.

Iscor is presently functioning as a corporation, but with this Bill it will be converted into a new company to dispose of the Government’s shareholding in Iscor. The Conversion of Iscor, Limited, Bill repeals existing legislation pertaining to the corporation with effect from the date on which the corporation is registered as a public company.

The Committee studied this Bill thoroughly and therefore we support the Bill.

Mr Chairman, the legislation under discussion boils down to the fact that the State has decided to dispose of its interests in Iscor. The significance of this decision is that the Government is recognising the fact that Iscor has developed into a successful and profitable undertaking which occupies a competitive position in the work-place. If this had not been the case, the Government would not have taken this step, since no one would have been interested in this offer.

What is important is that Iscor’s most valued product is not for sale. I read the following in an impressive advertisement for Iscor:

We on this side agree with every word. These are the men and women who, in the early days, laid the foundations for Iscor’s success and are still building on these foundations. It is the results achieved by these people that have made Iscor such a shining example, as reflected in the corporation’s most recent report, and they are not for sale.

This is not only the fifth successive year that a profit has been made, but it was also the largest profit and the best financial results that have been achieved since the corporation’s inception.

The group’s net profit after provision had been made for taxation, amounted to R249 million on the present cost basis, as against R97 million the previous year. This is also the first time since 1972 that Iscor itself has again paid income tax. The significance of this is that all the accumulated losses have been paid off. Together with the declared dividend, this brings the overall amount which Iscor paid to the authorities, during the past financial year, to approximately R247 million. The comment which Mr Marius de Waal, chairman of the board of directors, made in response to this was: “Paying tax is also a measure of success”. Cash flow is a further measure of success. Here the success is reflected in the fact that Iscor not only made provision for capital investment of R323 million, but also repaid long-term loans amounting to R270 million.

For me, as an old Iscorian and someone who still has strong ties with Iscor, it is a special privilege to refer to these outstanding financial achievements of Iscor.

Let us have a brief look at some other achievements of Iscor. Iscor is at present among the eight major steel producers in the world, with assets exceeding R5 000 million. Last year Iscor produced almost R7 million worth of liquid steel, almost 60% of which came from the Vanderbijlpark works, and more than 25% from the Newcastle works. The overall productivity of Iscor, measured by the NPI method, has improved since 1976 by an average of 3,5% per annum. The NPI’s National Prestige Award for productivity achievement has already been awarded to Iscor three times.

Cost comparisons between various steel manufacturers are for various reasons, not always significant. A cost comparison with Japan, one of the low-cost producers, for the 1982-83 financial year—this is the last year for which cost figures for Japan are available—indicates that Iscor’s total cost of production per ton of saleable steel is R479, compared with the R593 for Japan. This is about 12,5% lower than the production costs in Natal.

At present Iscor meets 72% of the local demand for primary steel products and is the only local provider of the full range of these products.

Iscor markets steel in almost 60 countries. About 18 months before sanctions became a reality, a start was made on developing strategic and tentative markets. All Iscor’s works-production units are producing at full capacity, in spite of sanctions. These achievements are all attributable to Iscor’s quality product—its people.

On 5 June 1928 the South African Iron and Steel Industrial Corporation Limited was founded, and on 4 April 1934 the first steel was tapped at Iscor’s Pretoria works. It was also in this year that the then Prime Minister, Gen J B M Hertzog, spoke the following prophetic words, and I quote:

Our country has now reached that stage. Iscor is properly developed, and the State is now being given the opportunity, by our passing this Bill, to grant Iscor responsibility for its own affairs. This enables the State to utilise the profits from the sale of a part of its interest in Iscor for other priorities. [Interjections.]

Order! The hon member for Yeoville!

The White Paper on Privatisation and Deregulation, which was accepted back in 1987, spelt out the policy with regard to the profits from privatisation.

In his speech at the opening of Parliament last year, the hon the State President reaffirmed this policy. In his budget speech this year the Minister of Finance announced further details about the utilisation of R600 million, this being the profit from the sale of Iscor shares. The hon the Minister also stated clearly that this revenue was not going to be used to reduce the deficit before borrowing.

It is a privilege for me to support this Bill on behalf of the NP. We are proud of every Iscor worker, proud of everyone who has made it possible for the State to take this step. We join Iscor in saying that we will not sell them. We will look after their interests.

To the CP we say that they should rather be worried about their own situation. We will look to the interests of the Iscor workers.

They rejected you a long time ago! [Interjections.]

Mr Chairman, we on this side of the House also state with confidence that every Iscor worker will be given ample opportunity to become a shareholder, in the new Iscor as well.

Mr Chairman, the Conversion of Iscor, Limited, Bill came before the joint committee and in principle we supported it. However, we must at the very outset mention that we supported it with very serious reservations. Privatisation is something which we see also as a monster that is developing and might perhaps take a direction of its own if it is not controlled. We are privatising what is selfsufficient and what is doing very well and in this regard this is exactly what we are doing with this corporation.

I also want to mention a very important point about the funds that are to be directed, in terms of clause 8, to the State Revenue Fund. We are a bit concerned about this as no provision has been made for us to have any access to this thereafter. We do not know what provision had been made in this regard. In the joint committee we were assured that some of these funds will be utilised for the purposes of eliminating housing shortages, squatter problems and improvement of the small business and informal sectors. Unless and until we have some confirmation on this, I believe that the income that will accrue from this will perhaps go into areas that might be less important. For some time now we have found that this Government is using funds to maintain and perhaps even prevent legislation on other matters which, I believe, are not necessary at present.

However, we support this Bill and I make an appeal to the hon the Minister to give us the assurance that we will be able to utilise the funds that will be derived and go into the capital fund, and that at times it will be made available to us to be used for other things that are very important in the community, such as schools, etc, as mentioned by the previous speaker.

Mr Chairman, my colleague, the hon member for Constantia, has already given our approval to this Bill. We welcome the form of privatisation which is taking place and the resultant reduction of Government involvement in the economy, coupled with the very desirable public participation in the economic affairs of the country.

The point has been made that shareholding should be as wide as possible and that employees in particular should be given the opportunity to participate, as this would be a sound principle of sharing the opportunity amongst as many as possible, whilst not allowing a single investor or a few major investors to control the activities of the company. Secondly, we have always said that privatisation must not merely be the transfer of a State monopoly to a private monopoly. We believe that this is healthy in the case of Iscor where it does have to compete in many of its subsidiary products. The Bill meets our requirements in that regard.

However, much has been said about what is to be done with the proceeds of privatisation. The hon member for Constantia dealt with clause 8 and so has the previous speaker. Clause 8 merely states that the proceeds will be paid into the State Revenue Fund. In this regard I think that it is instructive to look at what the hon the Minister of Finance spelt out in great detail in his Budget review of March this year. Hon members will recall that there was an earlier sale of Iscor shares to the value of some R600 million. The proceeds of that sale went to institutions such as the Development Bank of Southern Africa, the Local Authorities Loans Fund Board and the Small Business Development Corporation. Approximately R79 million or R80 million went into housing. We believe and support this sort of application of funds resulting from privatisation.

However, I think that one has to be very careful as to what one is talking about here. We are actually looking at what is an accepted and sound accounting principle which deals with the distinction between capital and revenue. Any operating company which sells its capital assets in order to finance its ongoing operating expenses is obviously on the road to bankruptcy. I think that the same can be said about the State at large. We are dealing with the capital structure of the economy. For example, where the proceeds are spent in applications which we support—such as the ones which I have just mentioned—this practice cannot be used as a way to reduce the Revenue Budget, because all that one is then doing is applying capital to revenue needs. I therefore think that one has to be very careful about that.

We are disappointed that it has not been spelt out in greater detail as to where the proceeds of the sale of these shares are going to end up. The idea of a capital fund appears to me to be a good one in that funds can be earmarked as the sale takes place. Funds can then be spent wisely in terms of replacing or at least maintaining the capital structure of the State, and not financing ongoing expenditure or current running expenses.

Obviously people will have their own views as to where the funds should be applied, since there is a whole host of infrastructural requirements that have to be met. I personally was particularly pleased to see that of the amount of R600 million that has already been realised, a fairly substantial chunk was used in housing. I have the hope that in the future as much as is possible will again be applied in this area since we continue to have such a desperate need for funds for both informal and low-income housing, and also in the provision of suitable land.

Mr Chairman, the attitude of the DP in this debate is obviously well known. I want to endorse what has been said by my colleagues, in particular the hon member who has just spoken.

I would like to use this opportunity to correct a statement that was made at the start of the debate on this Bill. This statement was made by the hon member Mr Derby-Lewis. He referred to Iscor as being an asset of White South Africa.

He is always lost!

That is quite correct. He is always lost. In fact, he is missing from the Chamber at present. Be that as it may, the fact is I think the CP has for far too long been labouring under the misconception that the assets of South Africa belong to White South Africans. If the CP would like to privatise South Africa by dividing it and compartmentalising it into White areas, that is their problem. We all know where that will land them.

Where were you in 1933?

That hon member wants to know where I was in 1933. Where was he in 1933? [Interjections.] If I remember the history of this country correctly, we were going through a very difficult period in 1933. It was the White Government of this country that helped the White employees. I would like that hon member to know that fact. It was the White socialist Government that helped particularly the White workers in this country, with complete disregard for others.

They solved the problems of their poor Whites!

That is quite right! They were only interested in solving the poor-White problem.

Order! We are busy with the Conversion of Iscor, Limited, Bill and not with a general debate.

I thank you for that remark, Mr Chairman but I was merely responding to a remark that was made by that hon member.

Order! The hon member may proceed.

I shall come back to the Bill. There is no doubt about the fact that the privatisation of Iscor will have a great impact on the economy and on the capital market of this country.

Previous speakers of the DP made their reservations very clear. When this Bill was discussed in the joint committee, we were told that the hon the Minister of Finance had given certain assurances to Parliament in this regard. Those assurances were contained in item 5.2 of his Budget annexures. Two things were quite clearly spelt out. The first was how the funds would be appropriated. The point made by my benchmate, the hon member for Constantia, was that we in Parliament would like to have far greater control over how these funds are appropriated. Merely putting them into a general revenue account does not give Parliament the kind of control that we want. Therefore, the hon member for Constantia has suggested that they should go into a capital development fund. I cannot see any reason why the Government should have any grave objections to this, more particularly when we consider that we are completely ad idem as to what should be done with these funds.

There is an argument that one cannot prescribe to a Minister in an Act as to what should be done. We should remember that we are dealing with a vast sum of money and that we are now selling assets of the country. We agreed to this, provided that the proceeds be used for very good purposes. I would like to support the suggestion that has been made and I would like to ask the hon the Minister to give it careful consideration.

The other point that arose from the speech of the hon the Minister of Finance was that, as far as he was concerned, the State would not seek control of Iscor any longer. The State would not take up more shares than was necessary.

The question that arises, is how much the South African market can absorb from the sale of these shares and how much will be given out to, for instance, foreign investors who wish to invest in Iscor. [Time expired.]

Mr Chairman, I would like to thank the chairman of the joint committee for giving me the opportunity to speak and I would like to say that he seems to have achieved a great deal in his first short period as the chairman of the joint committee.

It is very pleasant to follow the hon member for Springfield. It is nice to be a Nationalist and to listen to other people arguing about the past and what the problems are. Somehow in the NP we always seem to be part of the solutions. [Interjections.] I would like to give the hon member for Springfield the assurance that the shares will be neither White nor Black—they will just be shares.

I would also like to echo the sentiments of the chairman of the joint committee that these funds should not go to a designated fund. If everyone had just listened this afternoon to the various demands made upon the money that is coming from Iscor—some say it should go towards housing and others say it should go into a capital fund—they would have realised that it depends upon what is happening in the country at the time and upon the point of view from which one talks. I do not think there can be any better way of allotting these funds than to say that it is a fund that is going to be used for the best priority at that time. In my opinion that time will arrive.

The other reservations that I heard being voiced this afternoon concerned the question whether we should pass this Bill or not—although everybody is going to pass it. It was asked how much the Government will keep, how much it will give and how much there is to do. In my opinion a lovely compromise has been reached. It is more or less the same as the compromise they cached in Japan where the Government and the private sector work hand in hand for the benefit of the country.

We should not worry too much about politics while discussing these pieces of legislation in the joint committee. However, we should worry about the state the economy is in. The beautiful co-operation between the State and the private sector that is envisaged here is going to be good for everybody.

As one of the very few people here that have ever been in companies that buy steel from Iscor, I would like to give hon members a point of view that they have not heard before about passing this piece of legislation. It is going to be to the advantage of the ordinary person if the average small businessman who buys steel from which to make, for example, nuts and bolts or parts for a truck, can buy it from a private company, because as good as Iscor is, its priorities and policies are determined by a Government. In my opinion it is going to be much easier for the man in the street to have the right kind of steel coming out in a month’s time in the sizes that he needs, without being told that a certain kind of steel has to be exported or that something else has to be done with it. It is not a Government priority.

The other advantage that is going to be derived from this, is that overseas buyers would rather import their steel from a private company in South Africa, particularly where sanctions are involved, than from a Government-owned company. In my opinion that is going to be a great advantage.

The thoughts I have had about this, echo the views aired here this afternoon. A Government must by its very nature be slow and cautious in carrying out any such major project. There has been criticism that the Government has talked of privatisation but has done little to implement its policy. While the Government studied the effect of every move that it contemplated, it seemed to be terribly slow.

Last week the catering, landscaping, gardening and cleaning departments of the Government were privatised, but today we are busy with a blockbuster in which 57 000 workers and a capital investment of R6 billion are concerned. We are glad that the legislation makes provision for the retention of the name of the company. We all regard it as Iscor or “Yskor” and there are already thousands of contracts with that name. It is a fine point but one that has been thought about and we shall keep the name.

Much care has already been taken to ensure that the interests of the workers will not be adversely affected. In any company that has 57 000 workers and that has already started 1 500 circles of excellence—they are talking to the workers and working with them—the work-force is going to determine how many of the shares come to the company. Thought has been given to the fear that a State monopoly will be converted into a private monopoly. The shareholding of the Government should provide a balancing act between the two shareholdings. The company will end its financial year on 30 June 1989 and if one follows through that thinking one will find that that will be a very comfortable and malleable base on which the new juggernaut can be formed.

We hope that the initial fears expressed by the trade unions will be allayed by some sort of participation share scheme. It would be healthy for the country if there were many shareholders and not only a few. The shares could help to mop up the excess liquidity so that the hon the Minister of Finance will not be forced to take it from us as he has done and some of the liquid assets could help in the State at the moment. [Time expired.]

Mr Chairman, it appears to be my lot generally to follow the hon member for Germiston. There must be some psychological reason behind this. Other than the fact that he claims to be somebody more experienced in steel than most of us—I will probably concede this immediately, depending of course on how one spells that—I must say that I have little to quarrel about with him. [Interjections.]

We have said that we support this Bill and so we will. However, I think there are a number of issues that need to be raised and I would like to do so.

Firstly I want to deal with the issue which was unfortunately raised by the hon nominated member Mr Derby-Lewis, namely that these are the assets of the White nation. My colleague the hon member for Springfield has dealt with that. I just want to make it quite clear—there should be no misunderstanding about this and the hon the Minister should say so too—that the assets of Iscor are the assets of the people of South Africa. [Interjections.] They are not sectional assets which anybody can lay claim to.

In reply to the interjection as to what I was doing in 1933, I can tell the hon CP member who made that interjection that I was mighty hungry in 1933, and so were many other people. The trouble is that many people were hungry and continue to be hungry. To try to have an historical claim to the assets of Iscor by reason of what happened in 1933 shows that the party with which we are dealing here is the party of the Neanderthal man and not the party of the modern man of 1989 in South Africa. [Interjections.]

The second question that was raised by the same hon member was whether one could privatise in terms of this Bill. Anybody who has read this Bill must know that one can privatise in terms of it. I would suggest that the CP should read Bills before they debate them. It may be of some advantage to them as well as to the rest of us.

Who asks you for your advice anyway?

I am sure that that hon member is in need of a great deal of advice. However, I have no intention of giving it to him because he cannot afford to pay for my advice. [Interjections.]

I would like to deal with some other matters. When we dealt with the Bill concerning the privatisation or conversion of the SATS, we dealt with the question of long-term loans and guarantees and what their future was. There was a special provision in the Bill which dealt with long-term loans and State guarantees. There is, however, no such provision in this Bill. All that this Bill provides is that the long-term loans will be converted into debentures. Presumably these debentures will be quoted in the same way that stock is quoted at the present moment. The question of the future arises and one must assume that in the future Iscor will rest entirely upon its own financial ability and will not depend on State guaranteed loans. I think we should have some reaction to that.

Another matter that I want to deal with is the question of whether all the shares will be sold. In the explanatory memorandum as well as in the provisions of the Bill it is quite clear that all the shares can be sold. In fact, the explanatory memorandum says in so many words that the private sector can acquire unrestricted control over the activities of Iscor.

I must say that I differ with some people in relation to this because I am afraid of unrestricted control falling into the hands of the wrong people. I said this the other day. I still think that the idea of a golden share which enables one to protect the State’s interest when it is in the national interest to do so, is something that needs to be looked at. I do not believe that this should be ignored.

The other question is whether, insofar as the activities of Iscor are concerned, it is a good idea to float the company as a whole. Everybody has accepted that the company as a whole should be floated off but there are two district activities, namely a mining activity and a steel activity. In addition to that, the company owns 25,5% of a listed company called Meteor and 27,8% of another listed company called Union Steel. Very substantial monies could in fact be raised from these two investments which have a book value of only R20,8 million and as of 30 June 1988, had a market value of R68 million. There is a very substantial amount of money which is involved and the question arises as to what the future of Metkor and Union Steel is going to be and how they are going to be dealt with.

The other question that worries me is what the price of the Iscor shares is going to be. The reason why I ask that is because, if one looks at the profit history, it was R32,8 million in 1985, R170 million in 1986, R100,5 million in 1987 and R340 million in 1988, according to the last published accounts. I understand from members of the joint committee that an estimate of some R600 million was given for 30 June 1989. If we however take the assets of Iscor as of 30 June 1988, the book value of the shareholders’ equity was R4 085 million. We are told that that is now about R5 000 million. When I look at the profits of the company, which one is told will be R600 million although the after tax profit for the last financial year or so was only R248 million, and that is without paying 50% tax, I then have to ask myself whether the shares are not going to be issued at a very substantial discount on net assets if they are going to be in line with the returns of other similar companies on the stock exchange, and whether in those circumstances the question of the timing of Iscor flotation is not vital.

To take an example, at R600 million pre-tax let us assume they paid 50% tax it would be R300 million which would be closer to the figure of the previous financial year of R340 million. Let us, however, assume that it is R400 million or even R450 million. On a ten times earnings yield, this would mean that we would be selling the shares at a very substantial discount. In those circumstances I have to ask the question which I started off with and that is whether it might not be a more businesslike procedure to actually sell off and float off piecemeal. I have never believed that I should take R1 and sell it to somebody for 80 cents. Even the hon member for Germiston will agree with me that that is not good business. He might like to buy it, the same as I would like to do, but the reality is that shares are bought on return, earnings yield and dividends yield.

One should bear in mind that there is evidence to show—the Financial Mail and other people have done analyses—that the book value of the assets, that is the trading assets, in 1984 was already said to be 44% higher that the actual book value and is now at least 50% higher. We then have a different situation. This is borne out by the fact that Iscor’s trading profits, based on historic costs, were-R757 million in 1988, whereas based on current costs they were only R423 million. We have to my mind a very important financial consideration in regard to the privatisation of this entity which after all, here I use the words which I started off with, are a national asset, a very important asset and an asset which can be given to the public only on the basis of the State getting proper value for its money.

In those circumstances I must say to the hon the Minister I hope he will reply and deal with this issue that the issue of the pricing of these shares and the issue of the manner of marketing those shares become absolutely vital. This national asset must not be sold at a discount. It cannot be put into that category. It has to be sold at full value, we have to get our money for it and we then have to use that money for socially necessary projects in 1989 and 1990 which are equally if not even more important and socially necessary than was the establishment of Iscor when it was originally created so many years ago. That social necessity is what is important to us and that is why we have to get value for our money when we do this flotation.

Mr Chairman, I would like to thank hon members for their contributions to a very interesting debate. It is also a very important debate if we consider that this is a major step on the road of privatisation. I will deal with various points raised by hon members and then return to individual members who have put particular questions to me.

The hon member for Constantia started off by asking me about target dates. It is my pleasure to be able to announce that, if market circumstances do not materially change, the Government intends listing Iscor on the Johannesburg Stock Exchange during the first part of November.

I shall come back to the question of timing. The hon member for Yeoville made a very good point in that regard, but I do not think it will in any way materially change the point that we have targeted November as a likely date to offer shares to the public and to list Iscor on the JSE, if market circumstances remain more or less as they are at the moment.

As Iscor is the first major concern to be privatised since the announcement of the State privatisation programme, certain questions have been asked. Hon members expressed certain fears and in the public’s mind there are many questions that I would like to deal with very briefly.

The question was raised this afternoon whether the State will still be involved in the affairs of Iscor after privatisation. In other words, we were asked whether we shall only sell off a number of shares but retain control. In this regard I would like to refer hon members to the Bill before the House today. In this Bill provision is merely being made for the conversion of Iscor into a public company. However, it is the policy of the State that private enterprise must be encouraged to take up shares. For that reason we must give them a clear indication of what the attitude of the State will be after privatisation.

It is the view of the State that we do not want to exercise any control once we have privatised Iscor. Once we have made an offer to the private sector we would not like to exercise any further control over the company. I would like to come back to that point again. That question has been put in newspapers and I have tried to respond to it on numerous occasions.

*However, there would still seem to be suspicion-mongering that the State is not really serious about its privatisation policy. It is being maintained that we are simply dangling this carrot in front of the private sector, but in actual fact behind the scenes we still want to try to influence these undertakings. The State does not intend to turn back on the road to privatisation.

The number of shares in Iscor which are going to be made available will depend on the ability of the market to take up those shares. It is a function of the market whether Iscor is going to be fully privatised the first time around or whether more than one issue will be needed. At the moment it would seem as if it is going to be necessary to make more than one offer to the public as regards shares in Iscor.

A question was also asked about the strategic value of Iscor. I want to say at once that the fact that Iscor supplies an important product, an essential product for the South African economy, and can for that reason probably be considered strategic, does not make it impossible to privatise Iscor. I need only refer hon members to the privatisation of Sasol. It must also be borne in mind that although Iscor is the dominant manufacturer of steel in South Africa, there are also other manufacturers of this product. Furthermore it is also possible to establish competition for Iscor by way of imports, as well as substitute products.

As regards the argument that it is strategic, it remains a fact that if it becomes necessary for the Government, in an emergency, a crisis or state of war really to take possession of any of these industries in any exceptional, unusual situation in which it may be necessary, in the national interest, to supply steel in a different way to the way in which the private sector undertaking would do so, that emergency measure still exists for the Government.

†The hon member for Nuweveld asked about big business taking over Iscor and a number of other hon members also raised that point. It is true that the South African economy has a problem of over-concentration with too much economic power in too few hands. I have said before and I would like to repeat this afternoon that we do not intend to increase the already high levels of concentration in this country through the policy of privatisation. In other words, we would like to counter that situation as far as possible. We would like to encourage as wide a spread of shares as possible, not only in the hands of employees and staff but also in the hands of private citizens.

What about the small investor?

Of course this includes the small investor, but the small investor in this country is limited. We also need the investments of the larger institutions.

If we talk about the sums of money that can be utilised by Iscor and if we talk about the funds that will have to be raised by the investing public or by institutions, we are talking about large sums of money. If we decide to offer this only to small investors I am afraid that we will not get very far. We therefore need the investments of the larger institutions as well. We are going to promote wide share ownership. It is our intention to encourage as wide a share ownership as possible. The ordinary investor will get preference and we will do everything in our power to satisfy his investment needs.

Taking the problem of economic over-concentration into account the State has laid down as a guideline that any group of shareholders who are in one way or another interlinked may not hold more than 20% of the shares of Iscor. I think that by following this guideline the State will give a clear signal to the private sector that we are not in favour of a privatised concern falling into the hands of one or two of the large concerns in this country. This is in fact—I think it was the hon member for Yeoville who asked about a certain amount of control and not having unrestricted privatisation—the one important limitation that the State has considered necessary to impose on Iscor in its privatised form. It is a limitation of the number of shares that can be owned by one single group of interlinked or interrelated companies. This restriction will be dealt with in the articles of association, which may not be changed without the prior consent of the Minister.

I can therefore give the hon member for Yeoville the assurance that we are aware of some of the problems that might occur if Iscor were eventually to fall into the hands of one large group, and we are determined to avoid that. It is a measure similar to the so-called “golden share”. We have not worked out the exact mechanism but I can give hon members that assurance.

The same applies to foreign shareholding. I think an hon member also referred to the question of foreign investments. There we have a similar restriction, namely that we will restrict the amount of shares allocated to any individual foreign investor to 15%, and the cumulative foreign investment in Iscor will be limited to a maximum of 20%.

We know that by way of the financial rand we are offering international companies a very attractive price. On the other hand, I think that all the hon members here will agree with me that we would welcome any foreign company or investor taking up some of the shares allocated to the foreign markets, as we are in need of capital. It is an attractive investment for a foreign company through the financial rand, and I really hope and trust that some international firms will take up this offer. However there will be an equal restriction on the number of shares to be held by any particular foreign company.

The question was also asked whether by privatising Iscor, the State is not creating a privatesector monopoly—in other words, only moving a public sector monopoly to the private sector. This aspect is of serious concern to the State. We have instructed our financial consultants to investigate the structure on the basis of which Iscor should be privatised and whether there would be any merit in divorcing certain parts of Iscor from each other; for example, divorcing the mining activities from the steel works. The hon member for Yeoville asked a question in that regard, namely whether we should consider vertical disintegration. This would entail divorcing the mining activities from the steel works. On the other hand we could consider some horizontal disintegration; in other words, grouping certain mines and production facilities as separate entities and selling them off as two or three steel companies.

The consultants went into this, and they advised us that they have come to the conclusion that grouping the activities into different units will not promote competition as the respective production units produce complementary products, while many of the mines are sole suppliers of specialised raw materials to Iscor. They have furthermore concluded that the present Iscor structure, with its control over raw material, should be maintained to ensure the most economic production cost per ton of steel. Thirdly, they have advised that the economy of scale benefits of Iscor in its present form will ensure that a wide product base is maintained and will enable the company to participate in a very competitive international market. In other words, we have decided to privatise Iscor as an entity.

*The advantages of this are quite clear and although hon members can argue that this leaves a dominant manufacturer in the steel industry, I have already indicated that Iscor also competes with other manufacturers of steel. Iscor is not the only manufacturer of steel.

Hon members are also aware that Iscor must compete with substitute products in many fields. My colleague the hon the Minister of Economic Affairs and Technology could indicate to hon members to what extent the amount of steel used in a motor vehicle today has declined over the years, because so many other materials have started competing with steel as substitutes. We have nevertheless also requested the Competition Board to make a proper investigation of the competition implications of the possible privatisation of Iscor.

†The Competition Board came to the conclusion that with the exception of cancelling the so-called McDonald Award—which was an agreement with the SATS and I believe already an outdated agreement—as well as a limitation on shareholding to prevent enonomic overconcentration, no further regulatory measure was recommended for Iscor. The State is therefore satisfied that there is presently sufficient competition in the local steel industry, not only between producers but also from substitute products as well as imported products.

Quite a number of hon members referred to employee interests. I have stated before and I would like to do so again, that it is our intention to introduce a special employee scheme. I have instructed the consultants to investigate the most acceptable share scheme which will ensure the widest possible participation by all employees.

We have the responsibility of educating our work-force and encouraging them to become shareholders. I am convinced that once these guidelines are published it will be clear to the outside world that the State would not only welcome participation by the work-force, but that we will also encourage it through a very attractive scheme. At this point in time I would not like to divulge any further information regarding this scheme. However, we are consulting with employees.

*I have no doubt that responsible employers as well as trade unions should eventually encourage their workers to participate in this scheme because it will be to the benefit of the employee in the long term.

†I have already dealt with the ordinary man; the man in the street; the small investor whom we would like to offer as many shares as possible. We would like to see the widest possible participation by the public and each relevant privatisation exercise will follow this objective.

Mr Chairman, I have already dealt with the hon member for Nuweveld.

Newlands!

Let us please not discuss Newlands now. [Interjections.] Not today. We can talk about Newlands again next week or the week after that. [Interjections.] The wonderful thing about Newlands is that it always comes back.

I should like to thank the hon member for Uitenhage, the chairman of the joint committee, for the way in which he piloted the legislation through the committee. He pointed out that privatisation created more opportunities for the private sector, and also that the discipline of the market came into its own as a result. These are important truths which the hon member singled out in this connection.

The hon member also spoke about the percentage of shares which would be issued. I want to repeat that the number is a function of the market. We cannot determine that now. Market conditions will determine what percentage of Iscor will be privatised. If it were possible to privatise 99% or more of Iscor’s shares with one privatisation programme and market conditions were right at that stage, we would certainly like to adopt that course, but our advisers and consultants will give thorough consideration to this aspect at the right time and also test the market properly, because it is very important for us to implement this privatisation programme successfully. The hon member for Yeoville has referred on previous occasions and in previous speeches to the importance of implementing this privatisation programme successfully, and I want to agree with him.

In conjunction with this programme there is also an education and information campaign on what privatisation really means. As the programme develops in the forthcoming weeks and months, we hope to link it to an in-depth information and publicity campaign. This will enable the man in the street to learn more, not only about Iscor, but also about the privatisation programme and eventually about what advantages the taking up specific shares hold for him.

The hon member referred to the matter of a monopoly. I think I have dealt with that.

I do not think the hon member Mr Derby-Lewis has got away from the speech he made here last Friday, in which he adopted standpoints which placed him in the camp of the liberal Labour Party in Britain. I did not say that he agreed with all their policy directions, but when it comes to the arguments the hon member advanced against privatisation, he finds himself in that camp.

You are not listening to anything!

The hon member must go and make his peace with his own party.

†His own chief spokesman said in this very Chamber that the CP was in principle not against privatisation.

I agree with him. I said so myself.

He agrees with him. Why then all the fuss? If he agrees with that, why is he not supporting this measure? Does he agree that the Government should reduce the control they have in the economy? Does he agree that the Government should reduce the part it is playing in the economy? [Interjections.]

Let us talk about the principles. Is he in favour of a larger role for the private sector? Is he in favour of broadening the tax base to reduce the burden on the ordinary taxpayer? What are his principles? Why does he not come forward with principles? He tries to gain some political capital. If that is political capital, I do not want it. To refer to Iscor as a White asset! The economy of this country can only grow and continue to grow if we put racial prejudices behind us.

*If we want to give this kind of racial connotation to every aspect, I want to tell hon members that we are seeking confrontation in this country. The hon member had better not continue with this.

†Iscor is neither White nor Black; it is South African. We will develop it to the benefit of all the peoples in this country.

The hon member also referred to big business. I dealt with that. He also referred to the strategic argument and of course the employees. I dealt with all those arguments.

The hon member for Constantia supported it but with certain reservations. I have dealt with his question as to whether we are indeed going to dispose of the majority of the shares. I cannot assure the hon member, at this point in time, that we will be able to dispose of the majority but we have no intention of retaining any control over a privatised Iscor.

Perhaps I should deal with the question of the interest of the State and also the IDC in Iscor and in a privatised Iscor. My colleague the hon the Minister of Finance has referred in Parliament to the fact that the State has sold shares in Iscor to the value of some R600 million to the IDC. It is impossible to give the hon member a precise allocation. I can quietly tell him in the corridor what we estimate that to be but we will work on more precise percentages when we get closer to the privatisation of Iscor. I want to stress the fact, however, that it is the State’s clear intention—as I have said it is subject to market conditions—to sell all the issued shares in Iscor to the private sector and that in achieving this objective no distinction will be made between the shares held by the State and the shares held by the IDC.

There are some people who try to suggest that, although we might be prepared as the State to sell all our shares, we will use the shareholding of the IDC to quietly exert influence behind Iscor’s back or to try to retain some form of control through the IDC. However, we make no distinction between the shares held by the IDC and those held by the State. Should the market not be able to absorb all the issued shares of Iscor in the first listing and if the State, as well as the IDC, is still left with shares in Iscor, the State has laid down as a guideline that neither the State nor Iscor will vote on the remaining shares. I think that should give a clear indication of our commitment to privatisation. It is envisaged that this aspect will be spelled out in more detail in the prospectus but it again underlines our clear commitment to total privatisation.

We will follow the advice of the financial consultants as to what number of shares could be offered on the first listing of Iscor. The remaining shares will be sold only after taking careful consideration of the then prevailing conditions so as not to jeopardise the share price as reflected on the JSE.

The hon member for Yeoville dealt with the question of the pricing of the shares. I do not want to argue with the hon member or enter into discussion with him. I do not think I will have to disagree with the hon member because these are matters I believe we will find agreement on. However, I do not think it is appropriate that we embark upon a long discussion about the share price at this stage. Of course the return on the investment of the investor will be an important yardstick as to what price he will be prepared to pay. Any investor, small or large, will invest his money only where, in the long run, he will be satisfied with the return. I think that is an important aspect that will have to be considered when the final share price is determined. I can assure the hon member that the financial consultants have been given instructions to value Iscor taking into account all the factors and on such a basis that the sale of shares will put the maximum realisable amount in the hands of the State.

I therefore agree with the hon member. We must utilise the maximum, but that maximum will be determined by the return on the investment.

The hon member for Constantia and quite a number of other hon members referred to the proceeds and wanted to know what would be done with the proceeds. I would just like, for the record and to refresh the memories of hon members, to refer to what the hon the State President said at the opening of Parliament in 1988.

*I am quoting from the speech the hon the State President made on this occasion, in which he dealt with the proceeds of privatisation (Hansard, 5 February 1988, col 9):

†This is a commitment by the hon the State President.

*I am continuing to quote:

• —basic infrastructure and services in developing areas; and.
• —the creation of capital funds for the development of small industries and small business enterprise by the IDC and the SBDC.

My colleague the hon the Minister of Finance also dealt with this matter in his Budget Speech, and specifically in the published Expanded Budget Speech. In the Expanded Budget Speech one finds a detailed explanation of the objectives of these funds in para 5.2, as the hon member for Springs rightly remarked. In that publication my hon colleague made things clear. I do not want to quote the entire paragraph, because it would take too much time. I shall only quote the following:

I shall skip the next sentence and continue to quote:

In a subsequent paragraph the following is stated:

It must not go to any other outside fund. I am prepared to discuss with the hon the Minister of Finance, if this is at all possible for the State bookkeeping, the giving of a special indication with regard to an account of how these funds must be spent. After all, it is general knowledge that if a certain amount goes back to the State—let us assume the first privatisation revenue from Iscor totals R1 billion—it is possible to hold the Minister of Finance and the Government accountable for the spending of that amount. Then we must report to hon members and Parliament on this expenditure. If assurances are given with regard to the way in which this money is spent, we are responsible to Parliament to spend the funds in that way. Hon members need therefore not be afraid that the money will flow in and will be spent in some way or other without this being accounted for.

†I think the hon member for Springfield made the remark that he would like to see Parliament in a position to be consulted about the allocation or the spending of these funds. However, Parliament will be in a position to demand to know from the hon the Minister of Finance how the funds have been spent. Therefore Parliament will certainly be kept in the picture.

The control of Parliament is vested in the fact that the hon the Minister of Finance has to table his Budget before Parliament. That gives hon members the opportunity to discuss it and to demand an account from the Minister of Finance of how these funds have been spent. I share the view of hon members that funds should not be used on current expenditure. As a matter of fact, we have the words of the hon the State President to support us in that regard. The hon member for Constantia and other hon members who have spoken about the proceeds can certainly rest assured that the funds will be spent in the way that the hon the State President and my colleague, the hon the Minister of Finance, have spelt out. The hon member for Constantia also referred to big business. I think I have dealt with foreign ownership and the ability of small investors.

I wish to thank the hon member for Heideveld and the hon member for Mariannhill for their support. The hon member for Mariannhill had certain reservations about privatisation. I do not want to deal with them here. He did not really spell them out, but I would like to suggest to the hon member that he should read the White Paper again very carefully. I think all hon members read the White Paper when it was tabled a few years ago. However, by reading it again, many of the questions which have since arisen, can be dealt with adequately. I would like to recommend that all hon members read the White Paper again, because many of their questions are dealt with fully in that document.

The hon member for Pinelands offered his apologies for not being here. He also dealt with the question of proceeds. I think that I have adequately dealt with that matter. I have also dealt with the hon member for Springfield, as well as the hon member for Heideveld. I also wish to thank the hon member for Germiston for his positive words about privatisation and his support. I have dealt with most of the salient points raised by the hon member for Yeoville.

Mr Chairman, I wish to know if the hon the Minister has any plans to deal with the Union Steel and the Metcor shares, because they are very substantial holdings and are in other public companies. Does the hon the Minister intend to keep them or are they going to be sold?

Mr Chairman, as it stands at the moment, they are part and parcel of the Iscor corporation and they will therefore go over into the new company. At this juncture we have no intention of selling off those shares and using the proceeds for State purposes. We have looked at various other methods and have considered the financial position, cash flow and gearing of Iscor very carefully.

On the question of whether we should go ahead without taking more assets away from Iscor, we have decided against it. I would not like to divulge any further information, but the hon member will certainly get more information when the statements of Iscor are published within the next few weeks. In those statements many of the questions put by the hon member will be clarified. If at any stage we need to have some further discussions on the matter, I will welcome them.

I think there is one point which the hon member for Yeoville raised that I have left out. He asked me whether Iscor would stand on its own financial feet, so to speak, after privatisation. The answer is yes. Iscor will not qualify for any further Government guarantees. I think that is a very important and positive result of privatisation. Eventually companies and State enterprises will have to compete in the market for their capital.

*We must not underestimate this kind of competition and its importance in the South African economy. It is simply a fact that an organisation or undertaking in the private sector sees and pursues its mission, goal and task differently to the way it does when it is inside the State economy. When it is merely managed in terms of a specific function or directive and when its task is solely to provide more telephones, build more railways lines or manufacture steel, for example, the management has a different directive to when that function must be carried out in such a way that the undertaking can eventually go back to the capital market to negotiate for more funds on the basis of the return on capital.

If by means of privatisation in South Africa we can merely succeed in competing for funds on another basis, I believe we will have made one of the most important contributions towards utilising scarce resources in South Africa better. Funds will then no longer—with good intentions—flow so easily to establish an overcapacity in a variety of directions.

At the moment we have a situation—there are good reasons for this—in which there is a large overcapacity as regards the provision of electricity in South Africa. We have an overcapacity in the provision of telephones. Dr Wim de Villiers’ report on this was tabled recently. There is also an oversupply in many other fields. The great degree of oversupply means that the State had to incur debts and make loans to finance that oversupply and this resulted in the burden on the taxpayer eventually increasing dramatically. If by means of privatisation we can therefore succeed in placing competition for capital on such a sound footing that the yield on capital will really be the norm as to where we must use that capital, we will to a great extent have contributed towards an efficient South African economic system.

The hon Whip is indicating to me to hurry up. I must wind up my speech. I think I have dealt with most hon members. I therefore want to conclude by saying that this legislation in connection with the privatisation of Iscor, which is being discussed by Parliament today, is an important step towards rectifying the structural problems existing in the South African economy. Not only this privatisation, but also the symbolic meaning of this programme, which will have a ripple effect on other programmes, is even more significant because it creates scope for the private sector and private entrepreneurship. When we get this economic dynamo—the private sector—to work properly in South Africa, I believe all will be well with the South African economy.

Debate concluded.

Mr Chairman, the Electricity Act, 1987, does not make provision for the Minister of Economic Affairs and Technology to impose levies on the generation of electricity. The National Energy Council derives its funds by means of levies on petroleum products and coal. As electricity is one of the most important energy carriers, it is also necessary to impose a small levy on electricity that is distributed. The proposed levy would amount to a maximum of 0,01 cents per kilowatt hour on electricity sent out.

Whilst we support this, my concern is that the consumer will eventually end up paying this levy. Once that happens, the local authorities will eventually add administration charges because they will have to keep a separate account of this levy in order to transfer it to the National Energy Council.

I would be happy if the hon the Minister could allay the fears as to how the local authority will administer this and whether increased charges in the form of administration charges will be passed on to the consumer. Although the maximum amount is a meagre 0,01 cents, I would like to know whether this will not cause the consumer to pay a larger amount because the local authority will add its administration charges. With that, my party has no fears in supporting this amending Bill.

Mr Chairman, the proposed new section 5A(1), as contained in clause 1 of the Electricity Amendment Bill, provides for a levy of 0,01 cents per kilowatt hour on electricity sent out by an undertaker who generates more than 100 gigawatt hours of electricity per annum, payable to the National Energy Council.

The proposed new section 5A(2) provides that the levy referred to in subsection (1) which is payable in respect of the electricity, calculated in kilowatt hours, sent out during a month by an undertaker, shall be paid before the end of the next succeeding month to the National Energy Council.

In the proposed new section 5A(4) provision is made that the Minister may grant to an undertaker written extension of time of payment of the levy for a period not exceeding three months.

The proposed new section 5A(5) provides that the levy shall not apply to electricity sent out from any power station generating electricity from water pumped into a storage dam by means of electricity.

The proposed new section 13(9)(a), as contained in clause 3, provides that an undertaker who wishes to transfer his undertaking, or a part thereof, to another undertaker may also transfer to such other undertaker any servitude or other similar rights irrespective of whether or not the permission of the owner has been obtained.

The CP supports this amending Bill.

Mr Chairman, before I start discussing the legislation, I should like to say to the hon the Minister, on behalf of my wife and myself, that we were shocked to hear about his retirement from Parliament. The absence of his gentleness will definitely leave a great void in Parliament. We wish him, his wife and their family joy and prosperity in the years ahead.

The electricity industry is an important barometer of economic growth and prosperity. In South Africa, where 4% of the population of Africa generates in excess of 60% of the continent’s electricity, only about one third of the population have easy access to electricity in their homes at present.

The creation of prosperity through the exploitation, upgrading and utilisation of the mineral riches of Southern Africa is closely connected with the application of sources of energy and the profitable utilisation of applicable electricity technology. Similarly prosperity cannot be created without a high degree of upbringing and schooling. The quality of life is very closely connected with the availability of electricity in households.

It is a fact that the end consumer costs of energy in South Africa comprise approximately 15% of the gross domestic product. These charges are chiefly attributable to the energy-intensive nature of the economy, including mining, base metal production and mineral beneficiation, and include conveyance over long distances. The important point is that the more effectively South Africa can utilise its electricity and energy, the more competitive we can be and the more this will contribute to the creation of prosperity in our country.

Households consume approximately 15% of the total electricity consumption in South Africa. This underlines the fact that the greatest sector requiring improved effectiveness in order to create prosperity is the industrial sector. On the other hand, it is equally clear that the potential growth area lies in the domestic sector.

In the process of determining requirements, surveys are conducted on existing knowledge, perceptions and problems in the particular areas which are served. This means that in-depth studies are undertaken which in turn serve as a basis for projects to test and implement new ideas. This action obviously takes place through contractors like universities and other organisations. Owing to the present circumstances of the National Energy Council, it was decided to concentrate on campaigns of this nature in the year of its formation as well as on projects which could produce results within the time frame of a year. In addition of course, there are projects remaining from the old dispensation of the national programme for energy research which have to follow their logical course.

The Electricity Act, 1987, does not confer powers on the Minister of Economic Affairs and Technology to charge any levies on electricity. The National Energy Council (NEC) which was instituted in terms of the Energy Act, 1987, is currently funded inter alia by levies on petroleum products and coal and, seeing that electricity is also one of the most important carriers of energy, it is reasonable to place a levy on this too. The envisaged levy will be to a maximum of 0,01 cents per kilowatt hour on electricity sent out, that means approximately 60 cents on R60. The objective of the NEC is to promote and co-ordinate the energy interests of the RSA in co-operation with the public and private sectors. The NEC strives to promote the development of the RSA’s energy resources, technology and expertise. It further strives to promote the realisation of adequate and constant provision of energy and its effective utilisation. It also strives to stimulate a sound balance between economic and strategic considerations in decisions concerning the energy industry, as well as consultation among the countries of Southern Africa on affairs of common interest in energy. All this is the goal with a view to greater prosperity for all people and I wish to underline this thought.

The NEC makes this possible by a structured and co-ordinated approach to the development of the National Energy Strategy and furnishing the State and the community with objective information and advice on energy.

We support this amending Bill with all its amendments.

Mr Chairman, we are grateful for the support which we are receiving from the Labour Party and also from the House of Delegates.

The discussion of this legislation elicited great emotion and it came especially from outside organisations. The greatest argument which they put forward—I think we shall quite probably be hearing this argument later here in the Committee too—is that we are introducing a tax.

I think that the very first principle which we should express very clearly is that we are not dealing with a tax here. We are dealing with a levy here. The purpose of this levy is the sound principle that a consumer should pay for a particular service and for anything related to it.

If this had been a tax, all the taxpayers in the country would have had to shoulder the responsibility. Here, just as in the case of third-party insurance, it is only the consumer who is interested in electricity who is asked to pay this levy. We reached a stage where we realised that the consumers of petroleum products and coal were actually bearing the entire burden of funding and research projects being carried out by the National Energy Council. The consumers of electricity, which is an equally important source, pay nothing toward funding. The question was put whether it was fair that the petroleum and coal industries should subsidise the electricity industry.

This amending Bill therefore chiefly envisages addressing that deficiency, that is to levy electricity so that that portion of the energy spectrum may also contribute its rightful share towards energy research projects which are exclusively aimed at electricity. I concede immediately that people outside may perhaps use this for petty political gain but then they will be politically dishonest. Why do I say this?

Firstly, as already indicated, this is a levy and not a general tax. People who want to disparage it by calling it a tax must know that they are dishonest because it is not paid by all taxpayers. The same applies regarding third-party insurance for instance. It is only the motorist who pays this and it is a levy as not all taxpayers are liable for it. What is of great importance, however, is that the levy does not go to the central Treasury, as happens with ordinary taxes. In other words, the central Government cannot use this levy for all kinds of other projects. It can only be used for energy research and projects.

It is very important to say here, and for the outside world to know, that Eskom, which is to pay the greatest part of this levy, is also represented on the National Energy Council and they have assured us that they will fulfil the function of a watchdog.

Lastly, we have to point out that the levy is actually so small that it can practically make no difference to tariffs. If we take Eskom as the example again, we find that the amount which they have to pay annually is miniscule as seen against their total income. This means that, if Eskom were to pass on that levy to us as consumers, a person’s electricity account which was R200 for instance, or one who used electricity to the value of R200 a month, would have to pay something in the region of 20c more a month. It is honestly only an emotional fuss which was made by outside organisations purporting that it was “tax on tax” and I do not know what else. The fuss actually has no basis whatsoever.

What is of great importance, however, is that this levy will ultimately enable us to fund research projects—projects which really have become vital to us as a country. The few objections which we received from the United Municipal Executive have been settled reasonably well. They raised objections about city councils which generated electricity by means of pumping stations and this was also settled. The greatest objection, that is that the levy should not go to the central Treasury, was also disposed of by amendments.

We on this side of the House take pleasure in supporting this legislation.

Mr Chairman, to begin with I want to thank the hon the Minister, the members of staff of Eskom and the department for having come to our rescue while we were considering this Bill and for throwing some light in the darkness. After much explanation, and having been given the final analysis of what this is intended for, we basically do not have any problem with this Bill.

Firstly, the levy that is going to be charged will place approximately R15 million into the coffers of Eskom for research purposes. We are mindful that research must go on in order to keep the electricity supply and other things affordable. As far as this research is concerned we foresaw certain difficulties in that while the levies would be paid by all the people, we were not sure whether the benefits derived from research would be distributed among everyone.

Although this might be a little out of the context of this Bill, I think I must address that point because at grassroots level, out there among the people to whom we are answerable, this comes to the fore. I must say that I will not steal the hon the Minister’s thunder but will leave him to announce this.

I was very pleased that he addressed this matter. The problem is that we find that the local authorities are purchasing electricity at a certain price from Eskom and this is then distributed to the people on the outskirts of the area. They in turn pay a much higher price. My argument there was that it is the non-White communities in particular who live on the outskirts. They do not live there of their own choice but as a result of the Group Areas Act. One finds that the people who live within the urban areas or the semi-urban areas get a certain rebate because they live closer to the town or the supply. People who live further away have to pay, because the further one is the more one has to pay. I do not believe that is how it should be applied.

The supply of electricity to all areas is a necessity and a basic need. I think there should be some kind of subsidisation because people are moved to housing developments out of town as a result of group areas. I am very happy that the hon the Minister has taken this very serious anomaly into account and has taken immediate steps to address the matter. I say this because I believe that the funds derived from this levy will be used for research. Whatever benefits are derived from the research should go back into solving the problem—the butter should be spread over the bread.

I take pleasure in supporting this Bill.

Mr Chairman, I do not think anyone would object in principle to funds being made available for the purpose of research in the area in which this research will be done, namely electricity and energy. Nor is the proposed levy one which will place a substantial burden on those who pay it or on the taxpayer or consumer. However, what this Bill does, is to once again come up with an ad hoc measure, the application of levies, when the whole tax structure is now supposed to move into an era in which there will be more simplicity, more uniformity and fewer ad hoc levies and tax impositions than in the past.

The Margo Commission of Inquiry into the Tax Structure of the RSA made proposals in its report which were specifically aimed at simplifying our tax structure. One of the reasons why it has come forward with its suggestions is that the ad hoc application of levies, such as this one, makes it impossible for commerce and industry to plan on a long-term basis and to have certainty. It makes it impossible to remain competitive in comparison with major trading partners if, as happened in the past and as is happening now with this Bill, ad hoc measures which impose further levies are placed on the Statute Book.

The system of VAT is supposed to be introduced in 1990. It is more than likely that one of the services which will be subjected to VAT is that of electricity. Despite that possibility, the department deems it necessary to again come up with an ad hoc measure like this, a year before VAT will be imposed, to raise funds for research. One gets the impression that this measure will quickly be slipped through during this session to ensure that a little corner of revenue is still available through ad hoc levies before a more uniform system of taxation and the VAT system is imposed.

The institutions, associations and organisations which made representations to the joint committee—here I refer to Assocom and the South African Federated Chamber of Industries—came up with very valid arguments, some of which I have already used in suggesting that this Bill ought not to be passed or should be opposed. They are subjected to a multitude of ad hoc levies. It is very little comfort to say that the levy to be imposed is very small if one takes into account that it is likely to be raised in future, that it will be passed on to the consumer and that in future larger levies will have an impact on the consumer. The authorities from the Cape Town City Council made it quite clear that the levies which need to be paid will be passed on to the consumer.

The concept of the creeping poverty of the consumer is something which the legislators do not seem to appreciate sufficiently. Creeping poverty is certainly something which has developed because of the many ad hoc price increases and levies which have been imposed. We need only look around at the increases which we have experienced in all the various fields over the last three months, be it in transport, energy or foodstuffs. I believe this levy will increase to a far more substantial amount under circumstances in which its application is not subject to parliamentary control and under circumstances in which there is hardly any fiscal control over the amounts, how they are spent and how they are allocated.

We see no reason why this ad hoc measure should be supported. It flies in the face of the Margo Commission’s recommendations, it is rejected by commerce and industry as a measure which will make their task even more difficult as far as long-term planning is concerned and it is something which the consumer may not feel over the next few months but will feel when the levy is increased in future. Therefore, for all those reasons we in the DP intend to oppose this measure. We see no necessity for the hinds to be raised in this manner. Whilst we accept that sufficient funds need to be available for research there are other ways this can be done instead of through an ad hoc, rushed-through measure such as this.

Mr Chairman, this Bill amends the Electricity Act, 1987, to provide for a levy on electricity, to alter the circumstances in which a licence shall not be required for the generation of electricity, to provide for the transfer of servitudes on the transfer of undertakings, and to provide for incidental matters. My party supports this Bill.

Mr Chairman, I just wish to confirm that the DP has decided to oppose this Bill on the grounds that it is an inappropriate funding mechanism to fund only one part of necessary energy research. Of course we support energy research—it is a very important investment in the future—but we do not think it is appropriate to try and segment it into subsections and then raise funds for those subsections. Let us each year appropriate what needs to be appropriated for the overall task of energy research. This is one more tax imposed on the long-suffering consumers of this country and it is also somewhat of a sneaky tax in that it is indirectly imposed on the consumer, which complicates the existing tax system. On those grounds and in support of what was said by the hon member for Durban Central we oppose this Bill.

Mr Chairman, thank you for once again giving me the opportunity to address this Committee.

I should like to refer the hon member for Bayview to clause 1 of the Bill. He referred to administrative charges to be added to the electricity tariff structure by local authorities so as to collect the levy. This is not true, since the levy will not be collected by the local authorities; it will be collected and paid over by the generating authorities. Therefore I think the hon member’s concern that additional administrative charges will be added to the tariff structure, is unfounded.

*The hon member for Carletonville has offered his apologies for his absence. I thank him for his support.

I want to thank the hon member for Elsies River very much for his words of support. This hon member raised two important points. They were not actually directly related to the legislation but I do think one should draw attention to them again. He said that electricity should be used more effectively in South Africa. I consider that we can no longer afford to waste electricity in South Africa because the ineffective consumption of electricity is tantamount to the ineffective utilisation of resources which are in short supply and on the decrease, that is coal and water. Water is an important source in generating electricity. I should like to agree with the hon member that we should utilise electricity most effectively.

I want to thank the chairman of our joint committee sincerely for the work which he has done to have this legislation passed, as well as other legislation which he has dealt with over the years.

The important point raised by the hon member is related to the points which the hon members for Durban Central and Constantia made. It is very clear that those hon members were prompted to say this but they do not know what it is about. It is very clear that the issue is not only the financing of a small part of the sphere of energy. In my opinion those hon members do not understand what the aim of the National Energy Council is. This council does not deal only with electricity; it deals with co-ordination, rationalisation and research concerning all energy factors in South Africa, whether they are electricity, fuel or coal. To suddenly say that this is an ad hoc matter which is being slipped in is absolute nonsense. The levy on coal has existed for many years. This levy specifically confirms that it is necessary for the consumer of a particular commodity also to pay for the co-ordination, rationalisation and research concerning that commodity. I think they were merely struggling to say something to oppose the Bill.

There is control over this. The Auditor-General audits the funds of the National Energy Council. The National Energy Council has to report to Parliament annually. What the National Energy Council does with those funds may be discussed in Parliament. Consequently it is not altogether true that there is no control over this. A budget which is submitted by the National Energy Council has to be compiled annually as well. I think that I have replied to the hon members for Durban Central and Constantia with those words.

†I want to thank the hon member for Heideveld for his support.

I think the hon member for Mariannhill raised the matter of the apparent discrimination as regards the supply of electricity to various local authorities.

This matter has been identified and I think I have given instructions to the National Energy Council to investigate the situation. The first interim report will probably be received by the end of the month, after which we will decide on what further action should be taken.

*My thanks to all hon members for their support for this legislation.

Order! This Question will be put on a later occasion, and this debate is therefore concluded.

Mr Chairman, in the first place I want to tell the hon the Minister that my colleague the hon member Comdt C J Derby-Lewis tenders his apologies. I believe he also tendered his apologies to the hon the Minister because he had to catch a plane.

He asked me to convey a thought from his side to the hon the Minister as the hon the Minister will be taking very pleasant long leave after this session. He is welcome to it because we think that he has done a wonderful job in the years in which he has handled this portfolio. He has also set a splendid example to our newcomers and our younger people here in Parliament.

I cannot recall that he has ever really made use of hard, sharp politics. Now and then he pushed us about in a pleasant way and said the new people should get into line. This presents the CP with no problem but we want to ask the hon the Minister whether we may suggest that, after his retirement, he be co-opted onto the Tourism Board so that he may perfect the idea of the Blue Train and turn it into a tourist attraction in South Africa.

With these words we support the legislation.

Mr Chairman, the South African Tourism Board Amendment Bill seeks to change the membership of the Tourism Board. At present 13 specific members comprise the board. They are elected in the following manner: nine persons from the tourism industry, three persons from the State departments and one person selected by the hon the Minister from such organisations as he may deem fit.

Since the beginning of the 1980s there has been quite a bit of activity in the tourism industry. The growth of the industry in the last few years has been substantial. The present board being fixed, it appears to be inadequate to cope with the demands of the industry itself. Regional representation became a necessity and as tourism concerns the provinces, provincial participation and input became imperative.

With the legislation as it is the hon the Minister cannot use his discretion to accommodate the provinces. The amendment affords the hon the Minister the opportunity to appoint members to the board as he deems fit with a view to its smooth and efficient performance in the interests of the industry.

An amendment which read: ‘… in consultation with the Chairmen of the Ministers’ Councils of the respective Houses of Parliament’ was moved to qualify the hon the Minister’s power of appointment. We found some merit in that and we approved that amendment. This privilege is necessary in view of the changing circumstances which require new and fresh ideas.

The potential for development in the tourism industry looks good. The unprecedented rise in the value of the dollar has given foreigners the opportunity to take advantage of the many rands for dollars and tour South Africa at very cheap rates. We ought to be grateful to the tourists as this helps the economy by bringing in foreign currency. Apart from the foreign currency, tourism has many advantages which I will not go into at this moment. However, one of them is that people will advertise our country.

The hon the Minister together with his board should Haise with other departments such as Foreign Affairs and Law and Order to ensure that we maintain high standards, especially in the hotel and liquor trades. The SABS should ensure that hotels are rated on merit, quality and standards. Law and order should be enforced to protect tourists from rip-offs and mugging.

When I refer to law and order, I do not mean that a Black must be charged for using a facility reserved for a White. Embarrassing situations have arisen because of the apartheid system in this country. They are not only embarrassing to the person concerned, but also to the country. I must say that these very embarrassing laws can also be very hurtful.

I want to draw the hon the Minister’s attention to the fact that certain resorts are reserved for the exclusive use of White people. I refer to beaches and bathing facilities along the South African coastline, particularly the Natal coastal areas and the Cape. In the Transvaal the best resorts, created with general State funds, have become own affairs resorts, falling under the House of Assembly, and all the resorts are open only to members of the White group. I mention the following resorts for the information of the hon the Minister. Blyde River Canyon in the Eastern Transvaal is internationally famous. The Loskop Nature Reserve is one of the finest reserves. Warmbaths Mineral Water Springs and Baths is a rare facility. Whilst I am hopeful that there are great prospects for the tourist industry, I must express my disgust at the practice of reserving resorts for the sole use of Whites, based on apartheid.

The question now arises: How can one market this concept to tourists, both nationally and internationally? When I refer to tourists, I mean tourists of all colours, not only Whites. We do not only get White tourists to this country, but also non-Whites. Resorts in South Africa are for everybody, not for the exclusive use of some people. I hope that the hon the Minister will reply to my query regarding this untenable situation in our country, which is a bad advertisement.

Apart from these, we have no objections to this Bill.

Mr Chairman, I take pleasure in following on the hon member for Merebank.

A great deal has been said about the Tourism Board. Firstly, permit me to express my sincere thanks to the staff of the Department of Economic Affairs and Technology who deal with this matter and are sitting here behind me. I want to thank them very much. They are always willing to furnish information if we want to know something. They explain matters patiently to us. We also have a very good chairman and I want to thank him very much for the patience he has shown towards us as members from this side of the House, who always start putting questions and wanting to know things. He is always willing to inform us. I thank the staff of this department most sincerely.

I am pleased to participate in the discussion on the South African Tourism Board Amendment Bill. The amendments to the Bill empower the hon the Minister in future to appoint any person—including for example representatives of the provincial administration or other regional authorities—as members of the board. The joint committee introduced an amendment which provides the hon the Minister with guidelines on how to make such appointments in consultation with the Chairmen of the Ministers’ Councils of the respective Houses of Parliament. I want to tell the staff that this amendment provides for every possible council. In other words, this committee presupposed a possible council for Blacks, which could then also share in these affairs. That is why we think ahead so that matters may be handled correctly.

I want to thank the staff very much for their co-operation and the good relationship which prevailed. They realised there was a deficiency and, when the amending Bill was submitted, it was dealt with very well.

I next want to refer to the amendment to section 3 of Act No 100 of 1983 as we find it in the South African Tourist Board Amendment Bill:

This is quite right. We do not want to put our cars into reverse gear, however. If one puts a car into reverse gear, one causes many accidents. We request the CP not to put their cars into reverse gear. We do not want to go back 30 years into the past again. We want to go forward and hon members can help us in this. CP policy will only plunge our country into chaos.

Mr Chairman, I think the hon the Minister will respond to the specific points raised by the hon member for Heidedal.

The motivation for this Bill was spelled out by the hon the Minister in his address to the industry’s annual tourism forum on 17 February of this year when he said that a dynamic approach was needed to plan for sufficient infrastructure to meet the growing demands placed on transport, accommodation and other facilities by South Africa’s tourist boom, to which a number of previous hon speakers have also referred.

The rapid growth in tourism, both foreign and domestic, in the past two years after the doldrums in 1985-86 caused by the unrest, has highlighted the inadequacies of our tourist infrastructure at present, particularly as far as coordination at regional level is concerned. The chairman of the Tourism Board, Mr Danie Hough, stressed the need to pay attention to infrastructural development when he opened this year’s hugely successful travel indaba in Johannesburg three weeks ago. This annual indaba was attended by no fewer than 500 foreign travel agents from 37 countries as well as 1 500 local travel agents. The indaba underlined again the fact that South Africa has absolutely everything, except snow, to make it the ideal tourist destination.

Tourism is a natural foreign exchange earner for developing countries. Worldwide it was their second biggest foreign exchange earner last year. In South Africa tourism rates only fourth after mining, agriculture and manufacturing. Although tourist numbers increased by 14% this year to over 800 000—half of them, of course, came from neighbouring countries and thus about 400 000 came from abroad—and foreign exchange earned was up from R1,1 billion in 1987 to R1,4 billion in 1988, this still only accounts for 2,6% of South Africa’s total foreign exchange earnings.

If one considers that a country like Spain had over 44 million foreign tourists last year, it is obvious that there is a huge potential to be exploited in this country. Apart from the beautiful scenery, beaches, game parks, First World facilities and so on, South Africa, with its weak rand, is the tourist bargain of the world, as I think the hon member for Merebank mentioned. Increasing numbers of tourists are discovering this. Mr Danie Hough said recently that there is no valid reason why tourism should not become South Africa’s largest foreign exchange earner in the next 10 years.

Satour’s target is two million foreign tourists by the year 2000. It can be achieved, provided there is sufficient private sector initiative and Government co-operation at all levels to develop the infrastructure to cope with this influx.

Restructuring the Tourism Board as provided for in this Bill represents the departure point requested by the industry for getting the infrastructure right. A lot is riding on this Bill. It is seen by the industry as start of a new tourism strategy for growth.

One of the main stumbling blocks preventing growth in tourism, as highlighted by the memorandum to the Bill, is inadequate infrastructure at grassroots level. The Tourist Liaison Committee of Satour, its most important private sector committee, has long been stressing that the development and co-ordination of tourist infrastructure can only be dealt with effectively on a regional level, with the co-operation of regional and local authorities with the private sector.

The memorandum to this Bill highlights the necessity for regional representation on the Tourism Board. As I understand it, there has already been a recommendation that the four provincial administrators or their designated representatives should sit on the board and that provincial funds, facilities and efforts should be devoted to promoting tourism and helping to create the necessary infrastructure. This is very good news and, as I understand it, the industry is right behind this move.

As far as appointments to the board are concerned, however, this is only part of the story. The other aspect is effective and adequate representation of the private sector on the Tourism Board. Appeals are constantly being made by the Government to the private sector to produce the goods. The quid pro quo demanded by the private sector is that it wants a greater say in determining policy. Tourist promotion will succeed if it is a co-operative effort between the public and private sectors and I appeal to the hon the Minister to bear this in mind when he makes appointments to the board.

In conclusion, I would also like to suggest that the less political the profile of this board is, the better it will be for foreign tourism to South Africa.

Mr Chairman, we will be supporting this Bill. We consider the very highly structured provisions of the previous composition of the board, to have been unnecessarily restrictive and we welcome the fact that the board can now be appointed in the discretion of the Minister on the advice of the various sectors concerned with the travel industry. We think this will provide for an element of deregulation and more flexibility and in particular regionalisation of the tourism effort.

It is a special plea from an hon member of the Western Cape that we have so much to offer, but we believe we do not have the necessary thrust behind the marketing of our region. I suppose this applies to most regions in the country.

I would like to ask specifically—the hon member for Rosettenville suggested that there was going to be greater private sector representation on the board—what segments of the private sector will be drawn into this. Is it intended to give representation to, say, Asata? What exactly is intended?

Something I would like to touch on, however, is the question of what lies behind this change. Is it only that the hon the Minister is taking deregulation and regionalisation to heart or is this a consequence of what he announced on 17 February, namely that it is his intention to scrap the Travel Agents Board and the related Act? The hon the Minister made an announcement on 17 February to the assembled representatives of the travel industry, to the effect that he intended to scrap the Travel Agents Board. He then subsequently introduced some confusion into the scene because he apparently indicated to the Travel Agents Board itself, in a meeting on 24 February, that he did not propose to scrap the board, but only to restructure it.

On 7 March, however, he indicated in Parliament that he was, in fact, intending to scrap the Travel Agents Board. I would like know what the position is. I am sure that the industry is also very anxious to know whether he is intending to scrap the Travel Agents Board. Is it intended to then leave the situation under the regulation of the industry, as it is in most other countries, or is it intended that this restructuring of the SA Tourism Board will then fill the gap?

I think there is a general feeling in the industry that they do not want greater regulation. They fear that this will be the case if they have to fall directly under the SA Tourism Board, precisely because it is dominated at present by Government and public servants. Instead of gaining independence, deregulation and privatisation by the scrapping of the TAB, they will, in fact, be going backwards if the functions then fall under the SA Tourism Board. The hon the Minister will make an important contribution to clarity if he can answer these points during today’s debate.

If, of course, he proceeds and the Travel Agents Board is scrapped, the question of fidelity and protection of travellers will arise again. This used to be handled by Asata. Would it then go back to Asata? What are the hon the Minister’s intentions in this regard?

The hon member for Rosettenville also widened this discussion somewhat and referred to some general points in respect of the travel industry. I think the committee would forgive her and me for taking the discussion a little farther, since this is a rare opportunity to discuss tourism matters. I would like to take this opportunity to welcome some of the points which the hon the Minister raised at that tourism forum on 17 February. Eight challenges were identified, for example the challenge of regionalisation. I think we have seen the first steps being taken here today.

The need to privatise was also identified, as was the need to make research results more readily available to the industry in a form that can be applied in practical ways, the need to improve standards across the broad spectrum of the industry, a general consumer orientation to be developed and the question of achieving a free flow of movement throughout the country for all tourists.

We cannot ignore the fact—and I am pleased that the hon the Minister made reference to this—that inward tourism, apart from incoming tourism, is one of the biggest growth opportunities facing the tourism industry in the future. This means that one must provide free movement and unrestricted access to travel facilities, regardless of race. We had an example quoted here this afternoon, but it is one of the major stumbling blocks both in developing the tourism industry internally and in attracting international travellers here. It is simply not on in the modern world to have any tourism facilities restricted on a racial basis. We have to meet that challenge and the Government has to take a definite lead in the matter in terms of the law.

Another challenge is the question of professionalism in tourism. It needs to be more highly developed. There is a need for more training facilities and this in itself needs a lot of attention. The question of a better transport infrastructure, the question of chartered flights and cost competition to enable people to come to South Africa from long distances are all very important issues. I know that an announcement has been made that chartered flights will be acceptable on certain conditions. The question of what happens to the chartered plane if it comes here and unloads its passengers, still needs to be addressed. Does it have to go back empty or will it be able to transport other passengers from here outward? These are vital issues. They affect the future of tourism in this country. As was pointed out, tourism is potentially one of our biggest foreign exchange earners at a time when we desperately need foreign exchange.

Finally, the whole question of upgrading and planning ahead for the future of our tourism infrastructure is a vital issue.

Mr Chairman, the amendment to section 3 of the South African Tourism Board Act, 1983, is a meaningful amendment. We must leave it to the hon the Minister to appoint the South African Tourism Board. This board will be appointed on merit and it will also be multiracial.

We support this legislation wholeheartedly.

Mr Chairman, I wish to thank all hon members for supporting this measure.

The hon members for Rosettenville and Constantia highlighted certain very important issues concerning the expansion and promotion of tourism. They also highlighted the great importance of tourism in South Africa as such.

I would just like to make one point clear, namely that we should realise that the South African Tourism Board does not own any tourist facilities. They are basically there to promote tourism and, of course, to highlight situations which impede or restrict the development of tourism.

Cognisance will be taken of the points raised by many of the hon members here today concerning specific restrictions, the movement and the availability of tourism. I think in due course the new South African Tourism Board will have to take note of these restrictions and do whatever lies within their power to assist in getting a more free flow of tourists in the country.

*I think that domestic tourism is of paramount importance in the development of any tourism in South Africa. No foreign tourist will go to an area which has not first been opened up by tourists from within the country. I think this point is very important.

I should like to begin at the beginning and thank the hon member for Middelburg for his support and kind words. I have frequently said—and I shall continue saying it until it happens one day—that the Blue Train should not be an express but a train for tourists. I hope we shall also see a tourist train from Cape Town to Port Elizabeth again. I shall work for this as long as I draw breath. I want to assure the hon member of this.

I think I have already referred to the points which were raised by the hon member for Merebank. We have taken note of them. I merely want to repeat that the entire object of this legislation—this will also answer certain arguments which the hon members for Constantia and Rosettenville raised—is to confirm the presence of the private sector on the South African Tourism Board. It is important that there should be an element of private sector presence in the SA Tourism Board.

The only problem which I have with the current composition of the SA Tourism Board is that there is too large a representation of vested interests. This is one of the limiting factors which has led to the SA Tourism Board having reached a specific ceiling in their otherwise excellent progress. We shall have to spread it a little wider beyond vested interests only. Vested interests which currently serve on the SA Tourism Board all represent private sector interests. They are not Public Service interests. We want to move away from these vested interests a little.

The importance of the objective, however, is that a regional approach should be given greater substance in the composition of the SA Tourism Board. Who is in possession of tourism facilities at present? They are owned by the provincial administrations, local governing bodies and organisations from the private sector here and there. Tourism should receive far more attention on a regional basis. The hon member for Constantia referred specifically to the Cape area. I therefore consider it important that a regional approach concerning tourism be given greater substance in the composition of the Tourism Board so that tourism may receive far greater attention on a regional basis.

The hon member for Constantia referred specifically to the Cape. Natal and the Cape have already raised the objection that they do not have sufficient say on the Tourism Board regarding policy-making related to the co-ordination of tourism. The object of this new composition is specifically to have a say on a regional basis so that progress may be made with development on a regional basis.

I thank the hon member for Heidedal for the kind words he expressed especially to the staff of the department and the Tourism Board. I shall convey this to them. As far as the involvement of the Tourism Board in providing facilities is concerned, I want to mention hotels to hon members. At the moment there are very few restrictions on the use of hotels by all tourists.

I want to conclude by referring to one final matter, that is the standard of our accommodation. The hon member for Constantia referred to a series of factors which are very important in tourism but I want to refer particularly to the availability of accommodation which I consider one of our greatest problem areas. We shall have to upgrade the standard of much of the accommodation in South Africa and I hope that, by means of the board which we are to appoint, the regional approach and also the implementation of the new Liquor Act, we shall be able to make a real contribution to the upgrading of the standards of these facilities.

The hon member for Constantia put quite a few questions regarding the composition of the board. We shall decide in due course and in co-operation with the tourism industry and the regions how to divide up the regions and how we shall constitute the board and the subcommittees. I shall then also have to consult the Chairmen of the respective Ministers’ Councils on their total composition.

I still stand in principle by my decision to abolish the Travel Agents Board. The abolition is related to deregulation. I think that the industry should learn to regulate itself. I said at the “indaba” that this was my decision in principle and I held discussions with the Travel Agents Board and requested them to put specific proposals to me on how matters affecting travel agencies could be dealt with in future on a deregulated basis. I do not want to anticipate their recommendations but I expect to receive these recommendations within the next few weeks. We shall then, in co-operation with that board, take the necessary decisions on what to do about the board, how to deregulate it and what body, which is more deregulated than is currently the case, should be substituted for it if we should abolish it.

Debate concluded.

The Committee rose at 18h28.