I move—

That the House go into Committee of Supply on the Estimates of Expenditure to be defrayed from the Railway and Harbour Fund during the year ending 31 March 1966.

Mr. Speaker, the hon. the Minister, throughout his speech to-day, had to refer again and again to the tremendous strain that has been placed on the personnel of the S.A. Railways and Harbours, firstly because of the increase in the working of the Railways resulting from economic expansion, and secondly, because of the fact that there is a shortage of manpower. We want to say at once that it is quite a remarkable achievement by the personnel of the S.A. Railways to have given the services to the public of South Africa that they have done in the past year. We on this side of the House would also like to express our appreciation for the work they have done. They have performed their work even beyond the call of duty, and I think that every South African is not only grateful but admires them for the sacrifices they have made. We are very sorry indeed that only the Minister has the power to express his gratitude and appreciation in a more concrete form. That is beyond us; we have to be satisfied by expressing our gratitude, and we can only hope that the Minister in the course of time will seek to express his gratitude in a more tangible form.

When it comes to the Budget proposals of the Minister, we immediately find ourselves in serious difficulties because it is quite clear that what the Minister has proposed here is an interim Budget, a standstill Budget, and it does not reflect the real intentions and plans of the Minister for the next year. The Schumann Commission’s report was published in April of last year when Parliament was still in session. Commerce and industries were given until December of last year to make their representations, but Parliament does not know what the Minister intends doing about those very important recommendations, and we will not know until after the discussions on Railway matters in this House have been completed, as the Minister has told us. I think that is the completely wrong attitude to adopt towards Parliament. Surely, if we have to discuss the Budget for the coming year, we are entitled to know what exactly we are discussing, and we should not be left with vague suggestions from the Minister about concessions, short-term concessions, amounting to R6,000,000, which may reduce his surplus from R7,750,000 to R1,750,000. Surely Parliament and the people are entitled to know and to discuss the Minister’s plans, and particularly whether the concessions he apparently plans to give will have the effect of alleviating the burden resting on the ordinary consumer to-day. We do not know, and yet that is the most important thing we want to know. What is going to be done by the Railways to bring relief from the growing burden of costs resting on the consumers, the public, the ordinary housewives and the families of South Africa? We cannot estimate those because full information on Minister’s plans for the coming year has not been revealed to us. You will recall, Sir, that last year we of the Opposition made our major point of criticism of the hon. the Minister’s Budget the fact that there was no planning of the transport system of South Africa as a whole, but merely a limited approach to the S.A. Railways and Harbours.

The Minister then as the result of our criticism stated that he would appoint a commission to investigate the co-ordination of transport services in South Africa and their full and efficient use in the interest of the people of South Africa. But the surprising thing is that this undertaking was given a year ago, and to-day we have to hear from the hon. the Minister that he is still considering the personnel and, I take it, the terms of reference of such a commission, which has not been appointed yet. This we find most distressing and disappointing. Yet the Minister indicates—not in so many words—that he is planning very extensively the future of the S.A. Railways in anticipation of whatever such a commission may report. He may find that the commission will report to him in terms which will make the plans he is undertaking at the moment unwise, not appropriate to the general plans for the transport system of South Africa as a whole. There are many other things of a similar nature which we find distressing in the Minister’s Budget speech to-day, but as I think these matters should be considered further before we go into details I should like to move—

That the debate be now adjourned.

Agreed to; debate adjourned.

I move—

Mr. Speaker, Parliament is asked to appropriate an amount of R78,392,364 over and above the amounts made available in the Appropriation Act, 1964, and the First Additional Appropriation Act, 1965, for the administration of the country. In the First Additional Appropriation Act, 1965, an amount of approximately R10,100,000 was authorized. The total additional requirements for 1964-5 are, therefore, just over R88,500,000. This represents an increase of 6.26 per cent on the appropriation authorized in the Appropriation Act, 1964.

On Loan Vote A—Miscellaneous Loans and Services, an additional amount of R51,642,000 is required. The amount of R30,000,000 included under sub-head 1 of this Vote is for transfer to the South African Railway and Harbour Fund to cover increased expenditure on capital works by the Railways Administration. The increased expenditure has already been approved by this House and Parliament is merely asked to approve the transfer of the money to that Fund.

I also wish to say a few words about the additional amount of R17,700,000 requested under sub-head 7 of the same Vote.

In the past, as a matter of administrative convenience it was the practice to treat the Redemption Fund for Assisted National Housing Loans as part of the Local Loans Fund. It has now been decided, however, to treat the Redemption Fund as a trust fund, altogether divorced from the Local Loans Fund. The moneys in the Fund will be invested in Government Stock and Treasury Bills. An amount of R16,200,000 is required for reimbursing the Local Loans Fund for the loss of the Redemption Fund, but a contra credit will accrue to loan receipts via the Public Debt Commissioners. The balance of R1,500,000 required, is to augment the capital of the Fund to meet increased demands from the smaller municipalities for loans.

Hon. members will note that under subhead 9 provision is made for a loan of R5,000,000 to the Government of Rhodesia. It is the intention to make this loan available for specific projects, such as the Chiredzi dam, the Mbezi-Chiredzi railway, the Kyle dam canals, electric power supply, and an airport at Chiredzi. Our exporters have some interest in most of these projects and from the more general point of view it would also be to our advantage if these schemes are proceeded with. The loan will be for a period of 15 years and will carry interest at the rate charged by the Government on loans to the Provincial Administrations. I am sure this House will wish us to show goodwill and co-operation to our northern neighbour where its Government is experiencing some difficulty in the financing of essential development work.

If we deduct these exceptional items, totalling just over R51,000,000, we find that the additional requirements in the First and Second Additional Estimates together amount to only R37,500,000 which is an increase of about 2.6 per cent over the amount voted in the Appropriation Act, 1964.

If the expansion in all spheres is taken into account, hon. members will agree that this increase is very reasonable. I may add that during the years 1943-4 to 1947-8 the amounts voted in Appropriation Acts, had to be supplemented, on average, to the extent of 6.98 per cent. For the period 1959-60 to 1963-4, the percentage averaged 2.54. This year the percentage is slightly higher on that basis.

Mr. Speaker, I do not consider it necessary to give further details of the various services included in the Estimates now before the House. As in the past, my colleagues will be prepared to furnish hon. members with the information they require. I wish, however, to assure members that I am satisfied that the additional expenditure is fully justified.

In conclusion, I wish once again to explain to the House the purpose of the inclusion of nominal provision against certain items.

Strictly speaking, the inclusion of these nominal amounts is not to obtain an appropriation. The object is to bring the specific item to the notice of Parliament and thereby obtain the necessary covering parliamentary approval for a new service, the expenditure on which can be met from savings on the Vote as a whole. This procedure is also followed in cases where the increase in the total approved cost of an approved service is of such magnitude that it is deemed advisable to bring it to the attention of Parliament, notwithstanding the fact that the appropriation for the relative financial year does not require supplementation.

We do not propose to detain the House by having a general discussion at this stage. These Votes can be better examined in Committee when we have the various members of the Cabinet here to answer for their portfolios. We will make no comment at this stage.

Motion put and agreed to.

House in Committee:

Expenditure from Revenue Account

On Vote No. 5.—”Lands”, R90,000,

Will the hon. the Minister tell us a little more about Head J, “Welfare settlement”, where we are being asked to vote an additional R24,000?

This amount is required for loans to persons who are placed on welfare settlements. In the majority of cases they plant tobacco and no provision has been made for facilities for them to process the tobacco. This amount is now being asked for so as to make it possible for the Department to give them loans for the erection of rooms or ovens to dry the tobacco and to make it suitable for sale.

Vote put and agreed to.

On Vote No. 8—”Forestry”, R107,842,

Provision is being made here for an ex gratia remission in respect of G. O. Raubenheimer. The amount involved is R100,042. Sir, this is an ex gratia remission and I hope that the hon. the Minister is going to give us a full explanation as to the reasons for this remission. I hope that the Minister in the course of his reply will also give us some details as to the reason for the increase in the grant-in-aid to the University of Stellenbosch for research from R70,000 to R77,800.

This ex gratia remission to Mr. Raubenheimer is really the outcome of a disastrous fire. In June 1962 there was a very big forest fire in the plantations near George. The total damage caused by the fire, after making use of the trees to the best possible advantage, was R840,431; that was the total damage caused to State plantations as a result of this fire. After the fire the police investigated the causes of the fire and it was established that the fire had started on Mr. Raubenheimer’s farm. Mr. Raubenheimer was then charged in the magistrate’s court, was found guilty and sentenced to a fine of R20. Immediately thereafter the Department of Forestry instituted a claim against Mr. Raubenheimer for the sum of R840,431, which was the estimated damage, but the Department of Forestry was not the only one that suffered damage; there was also a private firm, Springbok Farm and Feeding Station (Pty.) Ltd., which also suffered damage to the extent of R35,000 according to their claim; the State and this private firm then jointly claimed R875,431 from Mr. Raubenheimer. Mr. Raubenheimer’s assets, however, taking everything into consideration, only amounted, in round figures, to R130,000. After negotiations between the claimants and Mr. Raubenheimer it was eventually decided to settle for an amount of R15,000 to be paid to each of the two claimants, that is to say, a total of R30,000 which Mr. Raubenheimer therefore had to pay. That means that Mr. Raubenheimer’s assets then stood at R100,042; in other words, a sum of R725,000 had to be regarded as irrecoverable damage; that amount could not be recovered because the joint claim exceeded Mr. Raubenheimer’s total assets by that amount. But the acceptance by the Department of Forestry of this sum of R15,000 meant that there was an amount of R100,042 which could be recovered from Mr. Raubenheimer if the State pressed its full claim. That would have meant, however, that Mr. Raubenheimer would have been entirely ruined financially and it was consequently decided, after consultation between the Department of Forestry, the Treasury and the State Attorney, having due regard also to the question as to whether the Court would allow the full claim for damages, to accept the offer made by Mr. Raubenheimer. That means that Parliament is now being asked to vote the amount which would have been recoverable if the full claim for damages, which Mr. Raubenheimer could pay on the basis of his assets, were awarded by the Court. If this amount is voted by Parliament it will be deposited into the Loan Account of the State; it will not be paid to Mr. Raubenheimer. It will be paid over to Loan Account so that the claim can be written off by that amount. In actual fact therefore this is not an ex gratia payment to Mr. Raubenheimer; he will not get a cent of it. This is purely a book entry in order to make it possible to write off this amount against the claim against Mr. Raubenheimer.

Did you not actually remit R700,000 then?

No, the R700,000 is irrecoverable because Mr. Raubenheimer simply has not got it. The R100,000 would have been recoverable if the court had awarded the full claim for damages, but bearing in mind the fact that the magistrate only sentenced him to a fine of R20 it would seem that Mr. Raubenheimer’s degree of negligence was not very great, and one is not sure therefore whether the Court would have awarded the full amount. It was generally accepted that the best course in the circumstances would be to settle the claim, and the claim was then settled by the payment of R15,000 by Mr. Raubenheimer to the State. Having arrived at this settlement the State then had to write off the recoverable amount of its claim, namely R100,000, and in order to be able to write it off it is necessary to vote the amount asked for here. I find this highly technical and I do not really understand it but the matter is being dealt with in this way in terms of a Treasury ruling.

As far as the other item is concerned, the grant-in-aid to the University of Stellenbosch for research, the position is that an agreement was arrived at the previous year—and it was also approved of by Parliament—that the forestry research institution of the University of Stellenbosch would be subsidized on a firm basis, calculated according to the number of lecturers and research assistants who would be needed in the department of forestry at the University of Stellenbosch to handle the necessary research projects. In estimating the amount, however, a mistake was made in connection with the average salary scales of the incumbents of certain research posts, and in the meanwhile the salary scales at universities have also been increased. This meant that an additional amount of R8,190 would have had to be paid in respect of the past year on the total strength of the University’s staff, but because of the fact that the research assistants’ posts were not all filled throughout the year, an amount of R7,800, will be sufficient to compensate the University in respect of research posts which have been filled in the course of the current year.

Sir, I must say that this sounds like frenzied finance to me. The Minister’s explanation is as clear as mud to me. I do not follow it. Did the Government get R15,000 and did the other party get R15,000? Who got the rest of the money? Is this just a book entry? Was nobody paid anything at all?

I think the hon. the Minister must give us a lot more information. When the hon. the Minister dealt with the question as to why this claim was settled he seemed to be skating over very thin ice. I think we are entitled to ask him to tell us with complete frankness whether in the opinion of the legal advisers of the Department the State would have succeeded if it had proceeded with its claim. Sir, he has indicated that one does not know whether the State had a strong case in view of the fact that Mr. Raubenheimer was fined only R20. I think the Minister must tell us whether he agrees that in the circumstances of the case a fine such as that was adequate. Obviously the Department did not, because even the acceptance of R15,000 as damages shows that the matter was very much more serious than the magistrate seemed to have regarded it. I think the Minister must be quite frank and tell us what his legal advisers advised him; he should tell us whether in fact they thought that this case was doubtful, whether they felt that there was any doubt at all or whether the simple facts are that Mr. Raubenheimer would have been ruined if the State had pressed its claim, and that it was really on that ground that the Government took the line it did. If it was purely a case, as it appears to be on the Minister’s own explanation, that this large sum of money could have been recovered by the State, but that the Government felt that it was not a case where in all the circumstances it should pursue its claim, I think we are entitled to be told that in the clearest and most frank language.

Sir, I think the hon. the Minister should be a little bit more explicit. The State’s claim apparently was something in the region of R840,000. Then after negotiations on the question as to whether the State could claim the full amount, a settlement was arrived at by which the State got R15,000 and the other claimant also got R15,000. In the first place, has this R15,000 been paid in cash? Did the State abandon the balance of its claim on legal grounds?

Yes.

Why then a remission? If there was no claim to be made why then this remission? This remission rather indicates that the State did not abandon its claim, but if the Minister is right in saying that it abandoned its claim, then why this remission? [Interjections.] I understood the Minister to say that the State had abandoned its claim in respect of the balance after getting the R15,000. I hope the hon. the Minister will explain because the position is completely obscure to me at present.

The second point on which I should like to have some clarity is this: The hon. the Minister said that Mr. Raubenheimer’s assets amounted to something in the region of R130,000. Does that include both fixed and movable assets? Was that the total sum of his assets?

It included donations that he had made to his wife and children after the fire.

Was the property bonded in order to get the R30,000?

He paid the money; where he got it from I do not know.

There would seem to be a number of peculiar aspects to this particular case. There were apparently two claims, one by the Government and one by a private individual. The Government’s claim was one for approximately R840,000 and the private individual’s claim was for R35,000. Each claim was settled for R15,000. It seems a strange state of affairs that a claim for R35,000 should be settled for R15,000 and that a claim for R840,000 should settle for the same amount. It would seem that if the only amount that Mr. Raubenheimer could pay was R30,000, then the distribution of that R30,000 between the claim on the one hand for R840,000 and on the other for R35,000 should have been very different.

Secondly I want to follow up what the hon. member for Port Elizabeth (South) (Mr. Plewman) said, because one of two things must have happened: Either the Department decided that they were going to waive the claim against Mr. Raubenheimer, in which case there is no need to have a remission or ex gratia payment in the Estimates, which we now have before us, or alternatively, Mr. Raubenheimer must have signed an acknowledgment of debt or agreed that he was liable for this particular amount. If he did not agree to that, then there is a vague claim against him which has not yet been proved, and the Department in its wisdom could have decided that it would not press the claim because they could not collect it or because they did not think they should do so, and then there would be no reason for the remission of this amount. But I think perhaps we will get the answer if the hon. the Minister will tell us why the Treasury asked for the inclusion of this item in the Additional Estimates.

I think it is understandable that the hon. the Minister should have this difficulty; he has just recently taken over the Department of Forestry and it seems to us that he cannot see the wood for the trees. If he tells us that this is a book entry of R100,042, where does the book entry come in on the other side? You see, Sir, if you have a remission of R100,042, then R100,042 has been spent, and if it is just a book entry there must be a corresponding entry on the other side. Where would that corresponding entry appear? If cash has not been paid and if this is purely a book entry, then we want to know where the book entry is on the other side. Until such time as we are given adequate proof we cannot be asked to pass this amount. I hope the Minister will give us a little more information than he did a little while ago. Until we get a satisfactory explanation I am afraid we cannot pass this item.

In addition to the questions already put to the hon. the Minister by hon. members on this side, I should like to put the following questions to him: If the damage caused to the State amounted to R840,000 and R30,000 was subsequently accepted by way of settlement …

Only R15,000.

If the State settled its claim for R15,000 and the private firm settled its claim for R15,000 we want to know whether there was a mutual agreement between the State and the other claimant that they would settle their claims for the same amount. I should like to know from the hon. the Minister in the first instance how the R130,000 is arrived at? How did they arrive at that figure? The State’s claim was for R840,000, and the hon. the Minister now tells us that because this man’s assets were only worth R130,000, the claim was suddenly reduced to R130,000, of which R30,000 was paid and R100,000 is purely a book entry. I should like to know where the R130,000 comes from. How was that amount calculated? It seems to me that it was simply sucked out of somebody’s thumb.

Perhaps I should try at this stage to deal with the various arguments and questions; perhaps hon. members and I myself will then understand the full implications of what is happening here. I just want to make one correction; I said here by way of interjection that this R15,000 had already been paid. I understand, however, that that is not the position. The full claim still stands, but this R15,000 cannot be accepted in settlement until such time as Parliament has approved of this ex gratia remission.

You said that there was a settlement.

Those are the terms of the agreement, but whether we accept the agreement depends on whether this amount is made available; in other words, the State has not abandoned its claim; the claim still stands and we can still proceed with it if it is considered desirable.

Let me deal first with the question put to me by the hon. member for Port Elizabeth (South) (Mr. Plewman), namely how we arrived at this figure of R130,000. The damage which the State suffered originally amounted to R840,431. The hon. member now wants to know how we arrived at a figure of R130,000 and eventually at R100,000. The reason for this is that Mr. Raubenheimer’s assets consisted of the following: A farm valued in 1964 by the divisional council at R85,660; movables R25,882; donations to his wife and sons since the fire R18,500, a total of R130,042. There were two claimants, the State and this private company. Initially the company insisted on full settlement of its claim for damages amounting to R35,000, but eventually the company settled with the owner for R15,000. There was no agreement between the State and the other claimant as to the amounts to be accepted in settlement. There was an intimation that if the State was not prepared to settle also, the other claimant would insist on the sale of Mr. Raubenheimer’s assets. It was not considered to be in the general interest that that course should be followed.

Why not?

It is naturally not in the interests of anybody that a private individual who engages in farming should be totally ruined in this way by pressing the full claim against him. That is why the State referred this matter to the State Attorney and its law advisers who expressed the opinion that there was no certainty as to whether the State would succeed with its full claim or with a claim for an amount equivalent to the full value of Mr. Raubenheimer’s assets. There was no certainty in that regard. There was no doubt that the State would be awarded a certain amount, but that amount would be entirely within the discretion of the court. We cannot say with certainty what amount would have been awarded to the State and it was felt that this was the best course to follow since Mr. Raubenheimer might have been ruined completely if the State had pressed its claim and because it was considered that it would only be reasonable to meet Mr. Raubenheimer by keeping him on the land in this particular case in which a fire, which was started as a result of a certain amount of negligence on the part of his employees, got out of control. After all, the same sort of thing may easily happen on the farms of hon. members who live in the same sort of area. Hon. members know that a fire may break out as a result of negligence or a degree of negligence on the part of their employees. Must we ruin the man financially in these circumstances? The State felt that it would not be justified in doing so, particularly having regard to the fact that there is no absolute certainty as to what the finding of the court is going to be eventually. The Government law advisers and the Treasury decided after careful consideration, since the other party eventually agreed to settle for R15,000, that the State should also be prepared to settle for a sum of R15,000. But in order to be able to do so, approval has to be obtained for the other portion of the total claim, the portion which might have been recoverable, to be written off by way of ex gratia remission. That means that this amount has to be voted as an item of expenditure to be defrayed from Revenue Account, but it will immediately be deposited again as revenue in the Loan Account, in just the same way as all forestry revenue is deposited in the Loan Account.

This thing happened before I became Minister of Forestry. I have no first-hand knowledge of the circumstances. But that is the in formation given to me by my Department. After having discussed this matter fully with them on various occasions I am satisfied that this is the best course for us to follow here.

It seems to me that the hon. the Minister has gone wrong somewhere in his explanation. As the hon. member for Pinetown (Mr. Hopewell) has pointed out there should be a counter-entry. It seems to me that the position is that the whole R130,000 of Mr. Raubenheimer was taken by the State and that the State paid R15,000 to the other claimant, and that this ex gratia payment is therefore now made, because the whole R130,000 was appropriated by the State. That is how it appears to me. But that was not the point I wanted to speak about. To what I want to draw attention is this: The hon. the Minister says that in respect of this fire at Mr. Raubenheimer’s farm he was only fined the sum of R20 in the magistrate’s court. This means that he could not have been very negligent. But if a fire causes damage to the extent of R841,000 I cannot for the life of me think what the Minister’s Department was doing. What precautions do they take against fire? Do they just allow a fire to rage? Don’t they take any precautions? I think the explanation of the hon. the Minister is an explanation of failure. I think the Minister’s Department is very sure indeed that if it should go to court the court will not allow the full claim. I am perfectly sure, as far as I know the position, that forestry departments take precautions against fire. For a fire to have spread over such a large area and to have caused damage to the tune of R841,000 there must have been extreme negligence. To me it seems as if the Minister’s Department knows that they have hold of the wrong end of the stick. It is perfectly true, as most farmers will know, that a small fire can assume large proportions only if the neighbour has not taken certain precautions. This seems to me to be a case where the Minister’s Department was negligent to such an extent that they feel they cannot press the claim. I have no comment to make on the ex gratia payment of R100,042 to Mr. Raubenheimer. I have no fault to find with that but I have fault to find with the Department. I have fault to find with the precautions which should have been taken in the ordinary course of events by anybody who knows anything about tree planting and forestry. Surely no ordinary farmer will allow himself to get into a position in which he can suffer a loss of R841,000 because of the lack of precautions. It seems to me that the Minister’s Department is in a very poor position. This whole explanation by the hon. the Minister seems to me to be a confession of neglect on the part of the Department.

When the non. member for Durban (Point (Mr. Raw) has finished with the hon. member for Drakensberg (Mrs. S. M. van Niekerk), I should like to reply to the hon. member’s re marks. I think I should reply immediately before this, to my mind, unnecessary discussion is taken further. [Interjections.] The hon. member over there ought to know that that fire was spread by wind which came up suddenly and became very strong. I am informed that it blew at more than 100 miles per hour on that occasion. Officials of the Department of Forestry lost their lives in the struggle against the fire which was raging there. This was one of the most destructive fires that we have had in the history of the Republic. The fire did not spread because of lack of precautionary measures. The Department of Forestry, together with the other bodies concerned, do everything in their power to make use of the most modern methods; they take proper precautionary measures. Hon. members know that where plantations are situated alongside one another, one cannot keep a fire which starts in one plantation out of the adjoining plantation if the wind blows at 100 miles per hour, even where there is a firebreak. How can one keep that fire out of the adjoining plantation? What precautionary measures can one take? I just want to make it perfectly clear that my Department and the other responsible parties did everything in their power to keep the damage caused by the fire down to an absolute minimum. And we are going to continue to use every means at our disposal in the future to keep the damage caused by fires down to an absolute minimum. There was no question at all of negligence or failure as suggested by the hon. member for Drakensberg. In actual fact every effort was made in this case to prevent the fire from spreading. I have the highest regard for what my Department did in this particular case.

May I ask a question? Was one of the points made by the defence that the extensive damage was due to the strong wind which was blowing that day and that the damage would not have been so great if the wind had not been so strong? Was that one of the points taken by the defence?

The point is that the wind suddenly became stronger and started to blow at a very high speed. If it had not been for that fact then the damage would not have been so extensive.

I want to come back to the point which the Minister has tried to explain here, and that is that because Mr. Raubenheimer’s assets were only worth R130,000 the claim was altered from R841,000 to R130,000. Surely the hon. the Minister cannot expect us to accept that.

I did not say that at all.

I asked how that figure had been arrived at and the hon. the Minister then replied that Mr. Raubenheimer’s assets consisted of the following …

Let me explain the position once again. The State’s claim is one for R840,431. That is the estimated amount of the damage. But after R15,000 had been paid to the other claimant, Mr. Raubenheimer’s remaining assets stood at R115,042, of which he is prepared to hand over R15,000; in other words, the other R100,042 is recoverable; that is to say, R100,042 of the claim of R840,431 is recoverable or at any rate it would have been recoverable if the full amount or an amount in excess of R100,000 had been awarded by the Court. It is because it might have been recoverable that my Department cannot simply drop this matter unless this amount is voted by Parliament as a write-off. That is the whole point.

There seems to be some doubt as to whether there was any negligence on the part of Mr. Raubenheimer. I should like to know whether it is customary for a private owner to insure and whether there was insurance in this case. That is the first point I want to make. The second point I want to ask is whether it would not have been advisable to have tested the case in court and have the facts established first as to whether he was liable or not. There seems to be some doubt in the Minister’s mind as to whether he is liable.

He was liable; he was fined in the magistrate’s court.

Is the hon. the Minister convinced that had he gone to court and claimed damages, he would have got the full amount of the damages?

No, I do not know what amount; but we would have got something.

Would it not have been advisable to have had the damages established? I am not saying we should not have made an ex gratia payment afterwards, but I think it would have been desirable to have established the fact because there seems to be doubt in the Minister’s mind.

In reply to a question by my colleague, the hon. member for Germiston (District) (Mr. Tucker), the Minister said, I think, that there was a very strong wind, that there was one of these terrific gales that blows now and again and that that was taken into account by the court when they fixed the penalty.

I said it was taken into account by the legal advisers and the State Attorney when they advised Treasury.

Through you, Mr. Chairman, I thank the Minister. I want to deal with the point made by the hon. member for Kensington (Mr. Moore). There is all the difference in the world between going to court on a criminal charge with which this man was apparently charged and going to court with a civil charge to try to get damages from him. Now that was never tested. The point seems to arise on what grounds we can take anything from him at all in these circumstances? What is the basis on which you even take the R15,000? [Interjections.] The hon. the Minister of Agricultural Economics and Marketing must not now get angry on behalf of his colleague. I am dealing with his colleague at the moment. Perhaps the hon. the Minister would like to come into the debate and explain the position on behalf of his colleague. His colleague is a new Minister. Perhaps the hon. the Minister of Agricultural Economics and Marketing can explain to us why this is the position. There was no case in court on the civil charge. There was nothing to show that this man would actually have had an award against him for civil damages notwithstanding the fact that there was a criminal case in respect of which there had been a conviction. On the face of it it looks as though it would have justified a claim being made against him, but that is not the point at issue, particularly when the Minister explains that this was one of those days when the weather was completely out of the ordinary. I have heard that from another forestry source as well. It was an act of God. It might well have been that the court would have said: No, we are not prepared to award any civil damages in this case whatever. Leave aside this question of book entries as between one Department and another Department. What are the moral grounds for claiming any damages at all from Mr. Raubenheimer? That is the point that occurs to me. There was a criminal conviction involving a very small amount indeed whatever may be said to the contrary. It was an extraordinarily small amount in a case of this kind; even if the court had thought there was something in the way of contributory negligence on the part of Mr. Raubenheimer it was still a very small amount indeed. Here is an extraordinarily difficult position because of the amount of damage that has been done. It seems to me pressure was brought to bear on the man; it seems to me that he was threatened with court proceedings that would have involved him costs and damages and that he gave way to that pressure. But that is not the attitude, in our opinion, the State should have adopted. The Minister has not advanced any reason whatsoever to show that there is any ground for demanding from Mr. Raubenheimer R15,000.

It now seems to me that I have done my work too well because in the initial stages of the debate hon. members opposite said, almost indignantly, “If this man has the money …” [Interjections.] Now, however, they say that we are making him pay far too much. It seems to me that if we continue this debate a little longer we may yet agree. Let me say this to the hon. member for South Coast (Mr. D. E. Mitchell): With the little knowledge that I have as a layman of legal practice, etc., I can say that he is correct in saying that a conviction in a criminal court is something entirely different from a civil court proceedings. But if a civil case is instituted, as the State ought to do in every case where it suffers damage of this kind—if it does not do so it will be criticized—then one does not continue with a civil case, as the hon. member for Germiston (District) (Mr. Tucker) suggested we should have done, merely in order to get judgment in one’s favour; one settles. That is recognized legal practice. The general practice in this country is that in civil cases the parties may come to a settlement at a certain stage of the proceedings, and they frequently do. That is what happened here. Two parties instituted a civil claim. The State instituted a civil claim and so did Springbok Farm and Feeding Stations (Pty.) Ltd. When Mr. Raubenheimer received those demands, he accepted responsibility by making an offer to settle. He was not told by the Department or by the State to make that offer of settlement. He himself made the offer after careful consideration. He offered to pay R15,000 to each of the two claimants. Springbok Farm was prepared to accept the offer and the State, after consultation with the State Attorney and with the Treasury, is also prepared to accept it. I honestly cannot see how we could have acted differently in this case. I think the way in which Mr. Raubenheimer is being treated in the circumstances is very fair. The circumstances were unusual but the fact remains that there was negligence. The fire was caused in actual fact by negligence on the part of Mr. Raubenheimer and his employees. He admitted this and on the strength of this fact he accepted a certain amount of responsibility.

In view of the remark by the hon. the Minister of Agricultural Economic and Marketing that there was a gale of 100 miles per hour it seems to me that this is an act of God and the Government should pay him back the R15,000 seeing that we are paying him this amount of R100,042 which he never paid to make confusion more confounded. Quite frankly this is an act of God. I quite agree with my hon. colleague. Even R30,000 can put a man in debt out of which he never can get. I think a 100 mile-per-hour gale is something nobody can prevent or be responsible for damage due to it. Therefore I should like to see that we pay him back the R15,000.

I want to ask the hon. the Minister a question. He has told us that the case went to court and that the smallness of the fine imposed has influenced the amount of the settlement. As so often happens in this type of case, the employees of the owner of the farm start a fire which gets out of control. Was Mr. Raubenheimer himself the person who appeared before the court or was it one of his employees? I live in an area where we often have bush fires. In many cases the owner of the land, who ultimately has to shoulder the responsibility, is away in Cape Town or elsewhere on business. One of his boys starts a fire for which the owner is eventually held responsible. I think there is a big difference in the angle from which we look at this matter and the amount of responsibility that rests on the shoulders of the owner when it comes to the question of assessing the damage.

Now that we have had this further explanation of this matter I think we must come back to one important factor. The relationship between the Government and Mr. Raubenheimer is one which they basically must decide themselves. They have full information regarding the facts as to what transpired. It is up to them to come to whatever reasonable arrangements they think correct. I accept the Minister’s explanation regarding this R15,000 paid to each claimant. But what I still do not understand is what this item is doing in the Additional Estimates. For the life of me I cannot understand it. We now understand the position as follows: There was a loss suffered by the Government of R840,000. The total assets of Mr. Raubenheimer were R130,000 odd, of which he paid out R30,000. That left him with R100,000. The Government, without ever having established a claim, in effect says “We have the right to claim from Mr. Raubenheimer and we would be justified in so claiming because we could establish it in a court of law; he still owes us R100,000.” But he owes the Government nothing, Sir. Mr. Raubenheimer does not owe anybody any money. The hon. the Minister has said he does not know whether he can substantiate a claim even for R15,000. He does not know. What this means, Sir, is that the Minister is saying to us: “Mr. Raubenheimer owes my Department R100,000. I do not want to collect it from him so I shall make him an ex gratia payment on the one hand and bring it into account as revenue on the other hand”. But that does not tie up with the facts. I do not understand the reason for this. I want to ask the hon. the Minister whether he would please be good enough to tell us why the Treasury insisted that this item should appear in the Estimates. Why is this item here, because I think the hon. member for South Coast (Mr. D. E. Mitchell) has put the position quite clearly. The hon. the Minister does not know whether he has any claim whatsoever against Mr. Raubenheimer. I am sure all of us, listening here this afternoon, do not know either. As a matter of fact, it seems to be, from what we have heard about the wind and so forth, that there is probably no claim whatsoever. Yet this item in effect says to this House, and to anybody in South Africa, that Mr. Raubenheimer owes this Government R100,000 but we are going to give it back to him as a present. I do not think that is fair, Mr. Chairman. And I do not think this is a correct accounting or budgeting principle. Perhaps the hon. the Minister will tell us why the Treasury insisted upon it appearing in the Estimates.

The question of the hon. member for Parktown (Mr. Emdin) is one which affects the Treasury. He wants to know why this item appears here. I can only say to the hon. member that this is sound budgetary policy; it is sound practice. We could have concealed this and in that case we would not have had this perhaps very useful discussion here to-day. The whole policy of the Treasury is to hide nothing. The position was that we had a claim, but if we went to Court we did not know what the judgment was going to be. We did know, however, that the maximum was R130,000; that was the maximum it could be. Because we did not know what the outcome might be, we decided that since this was a possible loss to the State we had to come to Parliament to obtain approval to meet this potential loss. That is our practice.

The Minister says it is good Treasury practice. He has a responsibility as Minister of Finance in preparing these documents to see that they are supported by adequate explanations. The Minister would have saved us a lot of time had he explained this item. He knows this is an item which does not appear in the original estimates and all we get is the bare information “ex gratia remission”. From his experience as Minister of Finance the Minister knows …

You cannot waive State revenue.

I accept that you cannot waive State revenue. I know that is practice. The Minister knows from his previous experience that when you have an item, and there is nothing under “original”, appearing under “revised estimate” it does call for inquiry. Surely the Minister would have saved the time of this House had he provided us with an adequate footnote. This makes it so ludicrous. The next item of R7,800 increase has an asterisk to it with an explanation at the bottom of the page. But this is a new item which, on the face of it, indicates an ex gratia payment, a free gift to Mr. Raubenheimer. Any person reading these estimates would get that impression.

Surely the hon. Minister’s staff should in regard to an item of this kind have put forward an adequate explanation, because the Minister cannot expect the House …

No.

The hon. Minister must not look so innocent in this matter. In future when Votes of this kind come before us and they involve additional amounts for which there was no original estimate, surely the Minister can give instructions that items of that kind should have an adequate explanation in the form of a footnote.

There are a number of other ex gratia payments made by the Treasury and under the appropriate head I will account for them.

Yes, the Minister must account for every ex gratia payment. But that is not the point. The point is that where you have an ex gratia payment, surely there should be a note on the Estimates giving an adequate explanation. That will save the time of the House.

You are saving the time of the House now!

As the hon. member has taken no part in this debate, from his remark it is quite clear to us that he is not capable of taking an intelligent interest in this debate, and surely in future the hon. Minister in regard to all cases of ex gratia payments should provide an adequate note on the Estimates. In that way he would save the time of the House.

May I come back to the question I put to the hon. Minister. In one of his earlier remarks, the hon. Minister linked up the fine imposed by the magistrate as a balancing factor in assessing the value of the damage. The two are linked up. What I want to know is who was actually fined? Did Mr. Raubenheimer appear before the magistrate, was he charged and was he fined, or was it one of his employees who was fined?

Raubenheimer was charged.

I want to come back to the interjection made by the hon. the Minister of Finance when the hon. member for Pinetown (Mr. Hopewell) was speaking. The hon. Minister interjected “We cannot waive State revenue”.

Possible State revenue.

Very well, any possible State revenue. But what makes the hon. Minister think that it was possible State revenue that was being waived? That is the crux of the whole matter. What makes him think that? The hon. Minister of Finance says that the maximum amount that the State would have been able to get was R130,000, of which R15,000 went to some other company and R15,000 to the Department of Forestry, that leaves the R100,000 here. But what makes him say that the State could only have got R130,000? Merely the fact that that was alleged to be the value of Mr. Raubenheimer’s estate? That does not mean that that is all that the courts would have granted. Over R840,000 damage was done, and no court is concerned with what the value of the estate is of a person who comes before it in a case of damage. He may be a man of straw and R500,000 damages may be awarded against him. That has got nothing to do with it. The court is not interested in the value of the estate of anybody who is the defendant in a damages case. There is nothing to show that the State in this case had reason to believe that R130,000 was the maximum amount that it could have got.

The maximum recoverable amount.

But we are not concerned with what was recoverable. The hon. Minister of Forestry is now trying to say that we could only have recovered up to the full value of the man’s estate. But only a few minutes ago the hon. Minister said that the R100,000 is not waived. He said that in reply to a question by one of my colleagues here. He said “No, it is not written off; this is merely a book entry for the purpose of the accounting of the Department, that is the Treasury, but it is not written of so far as the particular person is concerned.” Confusion gets worse confounded. The truth of the matter is that we are being asked from Revenue to vote R100,000 to the credit of the Forestry Department.

That comes back on the Loan Account.

That does not matter. I am not following it in all its wanderings through the Treasury. I am dealing with where it finally finishes up, and it finishes up in the Department of Forestry. The Department of Forestry has suffered a loss and apparently the Department of Forestry says “We can get R15,000 from Mr. Raubenheimer; it is obviously no good to go for him for more than the total value of his estate; he has given R15,000 to somebody else; that leaves R100,000; now we ask you to go to Parliament and from the Consolidated Revenue Fund to vote R100,000 which will come ultimately to Revenue on behalf of the Department of Forestry. We finish up with the R100,000 on the income side of the books of the Department of Forestry for the appropriate financial year, if this Vote is passed. There is the position, and we say again: Why? What possible ground is there to say that that R100,000 would have been obtained had there been a civil case? What possible ground is there for saying that R50,000, or R100,000, or R1 would have been obtained? The Minister of Forestry says that the legal advisers say that we would have got something, but they are quite unable to say how much it would have been.

Who can say?

Exactly, who can? The hon. Minister of Finance is taking my side of the argument when he says that. Who can? How right he is! It might have been R1, it might have been a nominal peppercorn that would have been granted. I have seen no rhyme or reason yet at all put up to us. no reason why we should give R100,000 to the Department of Forestry.

Raubenheimer himself said that it could not have been less than R15,000.

No, no, that is a completely wrong assumption. When a man is standing in the shadow of a Supreme Court action, what will he consider? I know of people who will pay R10 or R12 or R15 for minor speeding offences, or something of that sort, not because they admit guilt, but they do not want to go to the trouble to go to court, and here a man has got a Supreme Court action hanging over him and it looks as if he may be liable for R840,000. He may well say: I am going to get out of this for an amount of R130,000. But that is a tacit admission that in fact he owes it and that he is responsible for the whole of the damage, and that he is going to compromise now with the State and getting away with R15,000. But it is completely without any basis at all and the hon. Minister of Finance has not helped his colleague’s case by one iota.

The discussion up to now has demonstrated at least one thing, and that is, what happens to a man when he has greatness thrust upon him. Up to now, the hon. Minister of Bantu Education and Indian Affairs was a happy man. Then he succeeded to the Portfolio of Forestry, and without knowing it, as he told us, he inherited this pup in the form of the Raubenheimer case.

Order! The hon. member must confine himself to this particular item.

I am, Sir. I am dealing with the explanation that the hon. Minister gave that this happened before he became Minister of Forestry. He said that, and, Sir, I think I am entitled to touch upon that matter. He said that he did not know all the facts, and that was borne out by the fact that he gazed beseechingly at his officials, and the hon. Minister of Agricultural Technical Services and the hon. member for George, in order to get some information. He says he does not know all the facts, and so one naturally feels some sympathy for his discomfiture. But at the same time, one is entitled to ask him certain questions, and one of the questions I want to put to the hon. Minister is this: Did this person, Mr. Raubenheimer, carry no insurance whatsoever, e.g. public liability? Does the hon. Minister say that short of making this man bankrupt …

Was he insured with Parity?

The first point is: Did Mr. Raubenheimer have no insurance—for example, in the form of a public liability policy? This will possibly explain the point the hon. Minister has made that the Government, the State, did not want to put the man out of business, take him off the land where he was a farmer—they did not want to break him. Point Two: There was a reference earlier in this discussion by the hon. Minister to an item in the estate, or rather the assets of Mr. Raubenheimer, I think R28,000 or R18,000, in the form of gifts to his children. Now, if these gifts to the children of the person concerned consisted of various amounts of money, or part of the assets which had been disposed of, how does it come back again into the estate, as it were, into the estimation of the assets? How does that happen? Then there is the question of the wind that was blowing through that farm that day—the wind of change seems to have been blowing at 100 miles per hour through this particular farm’as it started off as a very minor incident, according to the hon. Minister, but by the time he got up to give his third explanation, it was a hundred-miles-an-hour gale that was blowing. That is what he said. It is no use him looking so despondent about it. I can’t help it if the hon. Minister makes such statements.

I can’t help it if you can’t understand what I am saying.

If the hon. Minister looks at his Hansard report, he will see that in his third statement he said it was unfortunate that on that day, a wind was blowing at about 100 miles per hour. Can I be taken to task for repeating a statement made by the hon. Minister?

You said that I started off by saying that this was merely a minor wind blowing …

Exactly. It was only a minor little breeze, but by the time the third explanation was proffered, it was a hundred-mile gale! I want to put this to the hon. Minister: He appears to have made his earlier statement under the misapprehension that we were taking him to task because he was dealing too lightly with Mr. Raubenheimer—because he had apparently been responsible for R800,000 damage, and all he had to do was to find R15,000 to square off. The converse appears to have been the case. The Minister appears to have dealt very harshly with Mr. Raubenheimer, as things turned out; and by the time we get to the bottom of this case, it may turn out that the Minister, in accepting the R15,000 from Mr. Raubenheimer, has been virtually guilty of robbing the poor. Therefore, I think it would be best if the hon. Minister armed himself with all the facts and, in one fell swoop, at the seventh attempt tells us exactly how and why this matter was settled.

It is very interesting to sit and listen to people who do not know what is going on. This makes me think of something about which I read in a book some time ago regarding a directors’ meeting and which I think is comparable to what has happened here. The first item on the agenda was an item of R100,000,000 to be spent on a nuclear reactor. The directors asked a few questions about it and then they said that they did not know what it was all about but they hoped that everything was in order and approved of it. The next item was an amount of R20,000 for lorries. A few questions were asked in regard to this item but after discussing it for half an hour, it was approved of. The next item was an amount of R15 which had been spent by a typist on a party and the directors spent the whole afternoon discussing this item! That is the type of attitude which has been revealed by the Opposition here this afternoon.

It is very clear that the hon. the Minister had this item inserted in the Estimates in order to bring it to the attention of this House. I should like hon. members who are so vociferous and who want to show how wise they are in this regard tell me how the Treasury should have brought it to the notice of this House if not in the way in which it has been done here. The only argument which hon. members opposite can advance is that it should not be shown as R100,042, but simply as R1, because then the item would appear here and we could discuss it. I want to tell hon. members opposite that some of them asked good questions and others did not; there were same hon. members who displayed complete ignorance in this regard and it would be better for them to sit still and just listen.

The hon. the Minister told us that Mr. Raubenheimer was fined R20 by the court because there was a certain amount of negligence on his part. If the Treasury, the State Attorney and the Department arrived at a settlement with Mr. Raubenheimer, what was so wrong about that? Do the Opposition want to tell us that the State should never try to arrange a settlement, rightly or wrongly, in the future; whether or not they know that they have lost a case, should the State still take the matter to court? Is that what the Opposition want? The hon. the Minister also said that there was a certain amount of negligence, that a strong wind came up at a later stage, a wind which became stronger and stronger. Indeed, the wind may even have reached the same velocity as that reached by a United Party supporter riding a bicycle through the Free State! I do not think that there was any other way in which the Treasury could have brought this matter to the attention of the House.

Order! The hon. member is repeating himself. He must advance a new argument.

Yes, Mr. Chairman. Hon. members opposite must realize that this amount of R100,000 will be shown as revenue in the future, plus the R15,000 which Mr. Kaubenheimer will have to pay.

There is a principle involved here on which I think we should get some clarity from the hon. the Minister. It is quite clear from what the Minister has told us in several replies that the settlement arrived at between the state and Mr. Kaubenheimer for the original claim lodged by the state of R140,000 was an amount or R15,000. The hon. Minister shakes his head, but i cannot see it in any other way, because the Minister has made it perfectly clear that the assets of Mr. Kaubenheimer were R1,50,000, he is meeting a claim of R15,000 from an independent company and he is making a settlement to the state of R15,000, leaving Mr. Kaubenheimer with R100,000. Now we have had the explanation from the hon. Minister that we are voting the R100,000 in order to keep Mr. Kaubenheimer on his farm and that the state does not take the remaining assets or Mr. Kaubenheimer. Is that correct or not correct?

Yes, that is one argument. We want to accept his offer.

In other words, to make a settlement or the State’s claim or R115,000, cash is accepted from Mr. Kaubenheimer to the amount or R15,000 provided that Parliament remits by voting this, the remaining balance or R100,000.

The State’s claim was R140,000.

In normal legal language I take it, the position was that the initial claim was R840,000, and the Minister is prepared to arrive at a settlement with Mr. Raubenheimer for R115,000, being the remainder of his assets after a separate claim of R15,000 has been paid.

No.

If that is not the position, what on earth are we voting the R100,000 for? The Minister said clearly a minute ago that, as a matter of policy, the State was not prepared to claim from Mr. Raubenheimer the total of his remaining assets of R115,000, because “he is an established person with a farm, and he should not be moved from the farm”. We heard from the Minister that there were exceptional circumstances and that that is the reason why the State is prepared to arrive at a settlement, because it was an act of God; that the original fire started through negligence, but spread to such proportions as a result of 100-mile-an-hour gale. The Minister says that this man should be retained on the land and that the State, therefore, should waive its claim against a farmer, although the State, according to the Minister’s legal advisers, has a perfectly legal claim. Now I want to ask; Is this tne principle that is going to apply in respect of all farmers who find themselves in difficulties vis-à-vis the State? We nave had a few interjections of the hon. Minister of Agricultural technical Services a minute ago. Is he going to apply tne same sympathetic approach to other farmers who, through acts of God, on account of droughts and other reasons, are finding themselves in difficulty in meeting their obligations to the State? We would like to know that, and they would like to know that, there is a further extension of the principle: There are numbers of farmers …

Order! The hon. member should confine himself to this particular item.

Sir, I am dealing with the reply the non. Minister gave, and the reasons the non. Minister gave in regard to waiving this claim. Because clearly it must be a matter of policy, and there is a principle involved as tar as the Government is concerned, and I think we should get complete clarity in respect of this matter because there are other people who farm extensively next to Government plantations, and there should be a clear-cut statement from the hon. the Minister in reply to his policy and how he views matters of this kind, because clearly others may be placed in the same difficulty as Mr. Raubenheimer was placed in this regard. But I cannot accept the statement made by the hon. Minister that we must vote R100,000 here on a claim of only R15,000 that he is making against Mr. Raubenheimer. Surely the claim must be R15,000, being the settlement figure the hon. Minister’s Department has agreed upon in lieu of the claim of R140,000, and in order to keep Mr. Raubenheimer on his property we must now vote the R100,000. Surely that is the correct position as I understand it, and not as the Minister says of arriving at a settlement of R15,000 only. I hope the hon. Minister will clarify the position.

I think gradually we are getting a clear picture. I believe that this matter has been hopelessly confused by the way in which it is reflected here. I have now understood from the various statements by the hon. Minister that the position is as follows: That there was a fire; there were circumstances in that there was an exceptional storm, there were doubts as to what was the amount that the State would recover, and finally, when the person from whom a claim had been made, made an offer to a third party of R15,000 and offered to the Government R15,000, those offers, after consideration, were duly accepted. Now I would believe that there was either a signed agreement between the parties in regard to the settlement, or more likely, an exchange of letters between the attorneys acting on the two sides, the State attorney and the attorneys acting for the claimants, and in terms of those I have no doubt—the Minister must tell me if I am wrong—apparently the claim was settled. It was no doubt an offer without prejudice and without any admission of liability, and there was an acceptance of the R15,000.

Only from the other party.

Alright, R15,000 was accepted by the other party. Now, as far as the State is concerned, the offer made to the State was R15,000.

Subject to the approval of Parliament.

R15,000 which the State is prepared to accept. There is no certainty, because the matter has not been tried as to whether anything would have been recovered. There are innumerable cases where, on a criminal charge, a motorist has been held guilty, but on a subsequent civil charge he has been found not to be liable for the payment of damages. There has been a disagreement. Obviously the second claim would have been heard in the Supreme Court and there might have been a variation. We now leave out the third party, but clearly so far as the State is concerned the offer from Mr. Raubenheimer to the State was to pay an amount of R15,000. For administrative convenience, apparently, the State has now decided (I believe Mr. Raubenheimer had no part in that), or the accountants who advised the State have recommended that an amount should be shown which is the net value apparently of Mr. Raubenheimer’s assets after these two amounts of R15,000 had been paid. This amount is shown as the maximum which in any circumstances could have been recovered if Mr. Raubenheimer had been squeezed to the last drop.

That is correct.

If that is so, then I say that the State has shown a settlement of R15,000; this R100,000 need not have been dealt with the way it is being dealt with, because in any case the State is clearly writing off a further R700,000, being the balance of what was originally claimed. Then surely the sensible thing to do is to write off the whole amount of R800,000, and not to deal with it by making it appear that the state is giving Mr. Raubenheimer a present of R100,042. In fact he made an offer of R15,000 which was accepted, and the matter should have come before us on that basis. If it had come before us on that basis, I think we could have avoided the whole of this discussion. We could have been told that there was this disastrous fire and tremendous damage to the State, which all of us regret, and I assume there was also great damage to Mr. Raubenheimer’s own plantations and damage to adjoining farmers. But it seems to me that it is quite unfair to Mr. Raubenheimer, now that I see the facts, to make it appear as if the State is in fact out of the kindness of its heart giving him a present of R100,000, when the real fact is that he denied liability, but made an offer of R15,000 to try and come to a settlement and to save the future of his family and children.

I think the hon. member for Germison-District (Mr. Tucker) has outlined the implications fairly well here. He stated the position fairly reasonably. I just want to say that I think actually it was not absolutely essential to come to Parliament at this stage to approve of this ex gratia remission. We could have accepted the offer with the permission of the Treasury, and we could have remained silent about it at this stage, but then the Auditor-General would have had to report this matter to Parliament; he would have had to report that a claim which was originally instituted for R840,000 against a man whose assets, taking everything into consideration, amounted to R115,000, had been settled for R15,000—a man who had been found guilty of a criminal offence in connection with this matter. He would have had to report this and then Parliament would have been able to discuss the matter. But the matter would then have been disposed of finally; the offer of settlement would then have been accepted and the matter could not have been re-opened. At the moment the offer has not yet been accepted. It has been intimated that if Parliament agrees we will accept the offer, but if Parliament refuses to accept the offer we will be able to go back and still claim the full R840,000. In this case Parliament is being given the opportunity to express its opinion as to the desirability of making this ex gratia remission, or rather on the desirability of accepting the amount offered by way of settlement and confirming the reasonableness of the offer, and Parliament also has the opportunity to discuss this matter before finality is reached.

When did the fire occur?

In 1962. It usually takes a very long time to dispose of claims. Hon. members must remember that extensive investigations were instituted in connection with this matter and that there was also a criminal prosecution. For a civil claim this was not a long period, particularly having regard to the amount of the claim and the fact that there are different claimants.I think it is a very good thing that we are giving Parliament an opportunity to express its opinion with regard to this case. But the important point is that here we are offering Parliament the opportunity to exercise parliamentary control, which hon. members opposite so jealously guard and which we ourselves jealously guard. Here Parliament is being given the opportunity, before the case is disposed of, before it is closed, to express its opinion. If Parliament refuses to approve of this amount and indicates that a different course is to be followed, then we will follow that course. But if we had accepted the offer of settlement and had remained quiet about it, then Parliament would have read about it two years hence in the Auditor-General’s report, but Parliament would then have been unable to do anything about it. That is the reason why we preferred to proceed along these lines in order to retain parliamentary control. I just want to say to the hon. member over there, who will certainly never have magnanimity foisted upon him, that as far as we know this person carried no insurance which would cover this sort of thing.

The hon. the Minister has just stated that Mr. Raubenheimer carried no insurance. What is the policy of his Department? Do they carry no insurance either?

The State never carries insurance in respect of its own assets; the State is its own insurer.

This matter is getting more and more important as the debate progresses, because there are great matters of principle involved. The Minister of Finance has told us that had this item not been put on the Estimates, we would not have had an opportunity of discussing it.

I said yes, later on, when the Auditor-General’s report is published.

That is correct. The hon. the Minister who has just sat down told us that this matter appears now so that Parliament can object or agree before the settlement is made. Now the important principle is this. Is this now to be the policy in regard to these matters? Is the policy to be different from what it is at the moment? The policy at the moment is that the Treasury, in consultation with the Department, will settle these matters, the Auditor-General will report it to the Select Committee on Public Accounts, which will either reject or accept it and then report to Parliament if it rejects it, and then Parliament will come into the picture. But here an entirely new principle appears by virtue of the fact that this item is on the Estimates. The Minister of Finance says he wanted to bring it to our notice, but this sort of thing happens every day. If a person knocks over a motor-car belonging to the Department of Defence and there is a claim by the Department against that person and it is settled, we are not told that this man is worth R50,000 and our claim could have been R40,000 but we have settled it for R10,000 and therefore we are asking for an ex gratia payment of R30,000 to be approved. It does not work that way and I think it is imperative that the Minister of Finance should tell us now that this is a new principle which is going to be adopted in regard to the preparation of the Estimates, that in respect of a claim which has not been decided in quantum, and where a settlement has been made, he is going to come to Parliament for prior authority instead of its being referred to Treasury and finding its way to the Auditor-General and coming before the Select Committee on Public Accounts.

You do not know what you are talking about.

Vote put and agreed to.

On Revenue Vote No. 9—”Public Works”, R1,850,950,

—May I ask for some information on the additional expenditure of R88,950, and ask how this expenditure was incurred?

I should like to refer to Item J, Rent, Rates, Electric Current, where there is an additional amount of R415,000 required, and may I ask whether the Minister can break down the figures so that we can know what amounts is in respect of rents?

As far as sub-head J is concerned, the revised estimate is R7,360,000. The increase of R415,000 is made up as follows: Rental,R150,000; the increase is due to the continual applications from our expanding State administration for additional accommodation and to the increases in rentals charged by lessors where leases have to be renewed. For municipal services such as water, sanitation and other services, the amount is R52,000 and for electric current and gas it is R213,000 making a total of R415,000.

The hon. member for Simonstown (Mr. Gay) asked a question with regard to Item N. There are certain buildings which, at the request of the Department concerned, are charged to Revenue Account. I refer to buildings other than administrative buildings, houses and quarters. That is the sort of building for which provision is made here, and the increase here is due to the expeditious provision of the services asked for.

Vote put and agreed to.

On Revenue Vote No. 10—”Treasury”, R122,000,

I should like to ask the Minister to explain the Item E, ex gratia refund to African Cold Storage (Pty.) Ltd. We are dealing here with a refund and not a remission, and I should like to ask what the basis of the refund was. Secondly, in regard to Item G, compensation for coin-operated machines, it is quite obvious that this is simply a nominal amount. Could the Minister at this stage give the House some indication of what is contemplated will be the amount of compensation which will have to be provided for ultimately?I think the House is entitled to more information in regard to this item.

The ex gratia payment to African Cold Storage (Pty.) Ltd. of R37,531 is explained as follows. As the result of a considerable increase in the price of meat, Messrs. African Cold Storage in Pretoria, to whom the contract to supply meat to Government institutions in the Pretoria and Voortrekker Heights area had been granted, applied for relief. On investigation it was established that the firm had actually incurred a loss as the result of an unexpected rise in the price of meat, and the Treasury accordingly approved of an amount of R37,531 being placed on the Estimates.

The item in regard to compensation for coin-operated machines—that is a new sub-head, and we consider it necessary at this stage in order to enable the Department to meet claims in the first quarter of the new financial year, if there are any. As implied by the heading, the money will be utilized to compensate owners of coin-operated machines. The position is that the Government has decided to pay compensation, but the basis of the compensation has to be fixed by the Committee dealing with this matter, which was appointed under the chairmanship of Professor Reynders. They will have to evolve a basis of compensation. At the moment I cannot give any particulars of that. This is merely a nominal amount to get it voted, but I suppose it will be more or less on the lines of the compensation awarded when we switched over to the decimal system.

What is the amount likely to run to?

I have no idea at the moment. It will depend on what basis they recommend. But in their preliminary Estimates I do not think the figure was anything near to what was paid in the case of the decimal switch-over. The provisional figure, I think, is about R1,000,000.

In regard to this item of the African Cold Storage, I can quite understand the Minister’s explanation, but here is a man who made a contract at a specified price and subsequently he made out a case to the Government that the price was too low and that he should be compensated. The wording used here is “ex gratia refund”, but surely he was not refunded anything. He was granted compensation and the word “refund” therefore does not fit in with the explanation given by the Minister. I accept the explanation, but it is not a refund of money; it is a payment of compensation.

The Minister has given an explanation, but is not a dangerous precedent being established? A firm finds that the prices of the product for which it has tendered have gone up, and now it asks for compensation. Is that going to be a general precedent which will apply to people who supply food to Government institutions? Where do we start and where do we stop in a matter of this kind? Here is a company which must have calculated its risks when it gave a firm tender for the supply of foodstuffs, meat. It must have made estimates. Surely if it was expected that there would be an increase there should have been an escalator clause, but according to the Minister’s explanation this firm found it had incurred a loss and asked for compensation. There are hundreds of companies which tender for Government institutions, and because of the inflation we have at present they are finding that by the time they have to deliver they make losses on Government contracts. Are they going to get compensation? There is a principle here which will open up the door to further ex gratia payments and we should like to have some assurance from the Minister as to whether this will be the general practice. The Minister of Defence will have all sorts of contracts with people who submit tenders, and then they find that due to the increase in the price of steel or labour they may have losses. Will the Treasury make ex gratia payments to them? What is the good of having a tender and a contract if that firm is going to be compensated for the loss incurred if there is an increase in prices? Is the converse going to apply, will refunds be given if the firm makes too much profit? If prices of meat go down, will the African Cold Storage get a refund? It is no good having a tender system and a firm giving a tender and entering into a contract and then getting a refund unless it happens in very exceptional cases.

This is not the first example of a remission of this nature. We have done it time and again. In my time as Minister of Finance, I remember cases that where a contract has been entered into and circumstances have arisen over which the contractor had no control, particularly as far as foodstuffs are concerned, that we have gone into the matter very thoroughly. It is not every application we accede to, but if the circumstances are such as in the opinion of the Treasury to justify that this man should not suffer a loss, then we give a remission of this nature. But it is very closely investigated by the Treasury, and we do not do it as a matter of routine. But where the circumstances are such, as has happened in the past, where there has been a sudden rise in prices and foodstuffs must be delivered, that has been done, because otherwise they might cease their deliveries and hospitals and other institutions will be in a difficulty. In order to ensure that deliveries are made, we are prepared to meet them in such cases as the present one.

May I ask a question? Is the amount of R37,500 plus the con tract price below or above the next highest tender which was received?

I have not got those figures.

I should like to know from the hon. the Minister whether this contract was one which was awarded by tender, and if so, whether there was a clause in the contract which made it possible for the Minister to make this ex gratia payment? It is customary in building contracts to have such a clause and I was wondering whether there was such a clause here. If there was no such clause, then I should like a reply to the question asked by the hon. member for South Coast. If the original tender plus this amount exceeded the next tender, then I think it is a very serious matter indeed.

I do not know why hon. members are getting hot under the collar. Every year we get before us a number of contracts that have been revised to the detriment of the State. They are tenders that were accepted and where the tenderers subsequently found that they could not carry out the contracts because of unexpected price increases. What is the position? The hon. member for Pinetown says the person should have made allowance for the risk he was taking. What would ten to one have happened is that he would have tendered 10 per cent or 15 per cent higher than he did for the meat he had to deliver to the hospitals and hostels and if you add all that together and you think of all the food that has to be supplied to State institutions is could have cost the State millions of rand more every year. That is why there is an arrangement that the Auditor-General must annually report to the Select Committee all the contracts that have been revised to the detriment of the State and they are subsequently analyzed. This is a case where it was revised before the end of the financial year and it is quite right that, instead of our only being confronted with this on the Select Committee next year, it is submitted to the House this year and the House asked to vote the amount.

I am pleased that we have this opportunity of eventually getting clarity on this question, namely, that if the State is not prepared to meet a tenderer who has tendered on the basis of making a very small profit and is suddenly confronted with an unexpected increase in price it will cost the State millions of additional rand because these people will tender at higher figures. That is the important point we have to face up to and I trust hon. members will consider this aspect of the matter. Those hon. members who serve or who have served on the Select Committee will also remember that we deal with numbers of such cases every year. In every case the chairman of the Tender Board comes and explains the position. They bring all the evidence and prove their case conclusively. No contract is revised if the person cannot prove beyond any doubt that he is suffering a loss.

While I am on my feet I just want to ask the hon. the Minister something in connection with the Advisory Board on Coinage. I notice reference is made here to an Information programme. I want to ask the Minister whether this board only travels around and gives information or whether it travels around trying to persuade people to accept its views, views which were rejected by the Select Committee last year. My information is that they have arrived at a post office, for example, and insisted that they abolish the 2½c postage and accept the 5c tariff. I get this information from municipalities and other bodies. If that is the case these people are trying to wreck something which has practically been accepted by Parliament. I should like the hon. the Minister to give us clarity on this matter, even if he only replies later.

I want to ask the hon. the Minister whether this type of contract is entered into without any provision being made for adjustment in the case of a movement up or down in the prices involved? Particularly in the case of meat where a large measure of control is exercised over the floor price, I should like to know whether it is customary to insert such a provision in these contracts, particularly where one knows that there is a wide fluctuation between the lowest and the highest price, so that for each agreed movement upwards or downwards the contract adjusts itself. If there is not such a condition I can quite understand a firm coming along and asking for relief, and I can even understand a sympathetic Government giving them relief. But it does open the door to a very serious position whereby tenderers for such contracts can deliberately lower the original tender price and then at a later stage come along and claim that prices of material, etc. have risen and ask to be compensated. It follows the principle very largely of the extras clause you get in building contracts, where the tenderer who tenders at a low price often secures the contract knowing full well that the extras will pay him handsomely once he has landed the contract. I think in a contract of this nature it is customary trade practice to insert such an adjustment clause, and it would be a surprise to me to learn that in a Government contract there is no such protection given against a rise or fall in prices.

As far as I know there was no so-called “escalator clause” in this contract. Had there been one it would not have been necessary to make an ex gratia payment. Nor do I think there is any reason to believe that the tender was particularly low with a view to getting the contract and then asking for compensation subsequently if any difficulty was experienced.

As far as the hon. member for Pretoria (Central) (Mr. van den Heever) is concerned, I can only say that as far as I know the Advisory Committee on Coinage is not busy, as he says, upsetting the decision of the Select Committee. What they have done, as far as I know, when it became known that there was a possibility of the post office increasing the rates for telephone calls from public telephones, was to say that if the Post Office decided to do that the Post Office must advise the board as soon as possible because in that case they would have to adopt a totally different attitude in respect of the automatic machines they were busy changing; if a change were to be made they wanted to know about it so that they could make arrangements to take the fact that it was going to happen into account. That is all that I know of.

Can the Minister tell us what the total amount of this contract was with the African Cold Storage?

I have not got the figures now.

Supposing the contract was for R370,000, then R37,000 is 10 per cent, but if it was for R75,000 it would be 50 per cent out, and it would indicate the extent to which the tenderer was careful in drafting his tender. I think we should have the information as to what the total amount of the contract was.

Reverting to the point raised by the hon. member for South Coast, if the lowest tender is R50,000 and the next tender is R53,000, then in no circumstances should any extra compensation exceeding R3,000 be paid, because then you would be exceeding the tender of the next lowest tenderer. That is the point.

I wonder whether the Minister can tell us, in regard to the item dealing with the information programme of the Advisory Board on the coinage, whether he has been consulted in respect of the programme for which the Minister is asking R30,000. and what is the basis of this information programme that is being conducted, and whether any private individuals or private consultants have been employed by this advisory board. I think it would be advantageous to the committee if the Minister could give some sort of general outline of the information programme the board intends to embark upon as far as the new coinage is concerned.

A publicity campaign has been set in motion so as to prepare the public for the changes in the coinage. A private firm of consultants has been appointed to do this work. That is the same firm which carried out all the publicity in connection with the decimal system.

The decimilization programme embodied a lot of other additional expense and this campaign will, I presume, follow a somewhat similar pattern. What I specifically want to know is this. The Minister says a private firm of consultants has been consulted. Is this R30,000 the fee that is being paid to the consultants, or on what basis are they employed, and who carries the responsibility for this information programme?

The firm of consultants works in close collaboration with the Department and particularly with this advisory board. They have to approve all the publicity that is undertaken. I do not know whether this amount is exclusively for the consultants, or whether it also includes the publication of brochures and other propaganda publications which are sent out. But this is all in connection with the publicity given to the change in the coinage, in order to educate the public.

Is it likely that there will be further amounts payable, or is this the total cost?

That Is the total cost we foresee for the current year.

Vote put and agreed to.

On Vote No. 12.—”Provincial Administrations,” R2,156,800,

Will the hon. the Minister tell us whether this subsidy to the provinces as a result of the revision of salary scales, consolidation of cost-of-living allowances. vacation savings bonus and so on, is calculated on the basis of the existing formula; in other words that all the traditional costs under the various sub-heads referred to here were totalled and this amount has to be paid on the basis of the existing formula, or was there a different formula which was used for the purpose of calculating the refund to the provinces insofar as all these various matters are concerned, the sub-heads of which are explained here. You see, Sir, the formula operates automatically …

Order! The hon.member may only ask for the reasons for the increase.

I was merely trying to explain my question to the hon. the Minister, more particularly by reason of the fact that he could not give us an immediate answer. I am giving him an opportunity to find the answer. If he has found the answer I will sit down.

When this temporary agreement was entered into, based on the expenditure, I think, for the year 1955-6, allowing for an increase, provision was made at the same time that if any increases were made by the Government in salaries; increases which the Provincial Administration would have to follow, the Government, over and above the other provisions, would pay 50 per cent of such rises. This is what we are doing here. At the Cape there is increased aid to civil pensioners, R80,000, and a salary adjustment in the case of nurses, R172,000; that represents our 50 per cent. Natal underestimated the amount required as a result of the 1963 salary adjustment. The balance of the increase is due to the 1964 salary adjustment in respect of Indian teachers, R160,000, nurses R170,000 and Bantu R85,000. The increase in respect of the Transvaal is mainly due to the fact that they under-estimated their requirements in respect of salaries, wages and allowances. The balance of the increase is due to increased aid to pensioners, R36,000, increased salaries of nurses (R95,000), and the adjustment of salaries of Indian and Coloured teachers R32.700. The decrease in respect of the Orange Free State is due to an over-estimate of the 1963 salary adjustment, against which must be put increased aid to pensioners, R7,000, increased salaries of nurses, R33,400, and increased salaries of Bantu, R32,500. That is how the amount is made up.

Vote put and agreed to.

On Vote No. 13.—”South Africa House. London (Administrative Services)”, R66,200,

Can the hon. the Minister give some information about the additional amount to be voted, with special reference to South Africa House, and tell us what improvements or changes are being effected in South Africa House requiring this fairly large increase?

The reason for this increase in item F. “rents, rates, maintenance and furnishings, etc. of South Africa House and other office premises”, is the following: South Africa House is not large enough to accommodate all the sections and we have had to hire additional accommodation. This amount is in respect of other premises as well as in respect of improvements to South Africa House.

Vote put and agreed to.

On Vote No. 15.—”Inland Revenue,” R46,610,

Will the hon. the Minister give us some explanation as to how this sum of A39,350, “Undistributed Profits Tax: A. Fruman & Associates (Pty.) Limited,” is made up.

Hon. members will notice that all these items are refunds and remissions of grace and favour. If hon. members would like me to do so. I will explain all these items. Where a number of items are governed by the same principle I will group them together. The item referred to by the hon. member stands by itself so I will deal with it first. This is something which we have every year. In terms of Section 48 of the Income Tax Act, the undistributed profits tax is levied on so much of the distributable income of a private company as has not been distributed by way of dividends during the “specified period”. The specified period is defined as a period of 12 months ending six months after the specified date for any year of assessment. The “specified date” means the last date of the year of assessment in question. The specified date of A. Fruman & Associates (Pty.) Ltd. is 30 June. The specified period is therefore the calendar year; it ends on 31 December. The company’s principal assets consist of shares in other companies and it derives its income in the form of dividends from those investments. It has been the practice of the company to distribute by way of dividends to its shareholders the dividend income received by it as soon as it is received, but as a matter of fact these dividends were received after the specified period—after 31 December, and strictly in terms of the law they have not complied with the rule that it should be distributed within the specified period. This was outside the specified period but it was distributed as soon as it was received. We have this type of case every year. The company has thus become liable for undistributed profits tax for the sole reason that the dividend of R157,500 which was declared on 15 December 1962, but which was not distributed during the 1963 specified period the year ending 31 December, as is required by the Act, could not be taken into account. By distributing its income as soon as it was received the company complied with the spirit and the intention of the law, but in the meantime, strictly according to the law, they had been assessed with the undistributed profits tax and it now proposed that the undistributed profits tax of R39,350 be remitted as an act of grace. Do hon. members want explanations in respect of the other items as well?

Yes.

Let me deal first with the two temporary liquor licences to Strong and Pienaar. A temporary liquor licence was issued to Mr. Strong, manager of Duff’s Continental Hotel for the sale of liquor at a function to be held on a Sunday, 25 November. In terms of the Liquor Act a temporary liquor licence may not be issued for the sale of liquor on a Sunday. The licensee was informed by the chairman of the liquor licensing board and the liquor staff of the police that no liquor could be sold under the licence as it had been issued in error, and as it was issued in error we are now asking that the amount paid be remitted as an act of grace. No use could be made of the licence, and it was purely an error on the part of the licensing official who issued it.

The position is very much the same in the other case. A temporary liquor licence was issued to Mr. Pienaar, secretary of the Sentrale Karoskou, De Aar, for the sale of liquor on the showgrounds between 10 a.m. and 10 p.m. on 15-16 October. The police had no objection to a temporary liquor licence, and it was issued to Mr. Pienaar by the acting assistant magistrate. When the magistrate checked the work which had been dealt with during the day—he was aware that a public auction of livestock and not an exhibition was to be held by the Sentrale Karoskou—and he noticed that the licence had been issued in error, he immediately communicated with the district commandant of police. The latter, who was under the impression that the licence was required for a show, because it was being held on the showground, raised no objection under that misapprehension. The applicant had paid for the licence and he had no use for it, so the licence fee was refunded.

Then I come to “late hours occasional licence”, which was issued to Mr. Stonall in his capacity as secretary of the East African Pavilion Cafe, in terms of which the company’s hours of sale of liquor were extended to 9.30 p.m. on 15, 16, 22, 23, 29 and 30 November; the hours were extended by one hour per day. At a SDecial sitting of the Liquor Licensing Board in Johannesburg on 22 November, the board authorised an extension of the hours of business of the licensee to 11.30 p.m. as a special privilege. Again it was not necessary to have this late hours occasional licence because he had been given a licence generally to keep open his business until 11.30 p.m. This was only to 9.30 p.m., and he was given wider powers by the Liquor Licensing Board; this licence was not necessary and the Secretary of the Treasury has approved of the amount of R16, being a fee of R4 per hour for each of the days included in the original payment of R24, being refunded as an act of grace, subject of course to the prior approval of Parliament.

Then I come to the wholesale liquor licences: Springbok Wynkelders, Van Riebeeck Wyn en Brandewyn Maatskappy, Christina Magdalena Myburgh, Hermanus Christoffel Pienaar, Christoffel Hercules Kruger, Pretoria Wine and Spirit Company (Pty.) Ltd., Kloof Bottelstoor, A. Sweidan and King (Pty.) Ltd., Myrtle Grove Wine Producers (Pty.) Limited, Harmony Bottle Store (Pty.) Limited, Bosveld Bottle Stores (Pty.) Ltd., and Avenue Bottle Store (Pty.) Limited. This applies to all of them; In terms of Section 55bis of the Liquor Act of 1928, the holder of a wholesale liquor licence may, subject to certain provisions, apply for the conversion of that licence into a bottle liquor licence; that is in terms of the amendment of 1963. Authority was granted to the holders of wholesale liquor licences, Nos. 1 to 9, that is to say. Springbok Wvnkelders up to and including Myrtle Grove Wine Producers, for conversion, and, upon payment of the prescribed fees, reduced in accordance with Section 12 (3) of the Liquor Act, new bottle liquor licences were issued. Licensees Nos. 10,11 and 12 held wholesale liquor licences, as well as bottle liquor licences. Section 76 of the Liquor Act, however, provides that an unlimited amount of liquor may be sold under any bottle liquor licence and wholesale liquor licences were therefore not required. The Secretary to the Treasury has approved of the refund of the licence duty as an act of grace, subject, however, to parliamentary approval being obtained. That is also a case where the amount was paid, but it was not necessary, and in the circumstances we are asking that it be refunded.

Then I come to the wholesale liquor licences issued to Wolmaransstad Drankwinkel, Observatory Wholesale Liquor Supplies (Pty.) Ltd., Rocklands Wine and Brandy Company (Pty.) Ltd., Springbok Bottle Store, Letaba Bottle Store (Pty.) Ltd., Star Wine & Brandy (Pty.) Limited, Barnet Dansky and Jan Pickard (Tvl.) (Edms.) Bpk.: In terms of Section 55bis of the Liquor Act, as amended in 1963, the holder of a wholesale liquor licence may, subject to certain provisions, apply for the conversion of that licence into a bottle liquor licence. Authority was granted to the above-mentioned holders of wholesale liquor licences for the conversion and upon payment of the prescribed fees, reduced in accordance with Section 12 (3) of the Liquor Act, new bottle liquor licences were issued to them. The Secretary to the Treasury has approved as an act of grace of the refund, calculated on a pro rata basis of the wholesale liquor licences originally paid, subject to parliamentary approval being obtained. This is the same type of case as the others.

Arising out of the hon. the Minister’s statement in regard to the last eight licences, starting with Wolmaransstad Drankwinkel and ending with Jan Pickard (Tvl.) (Edms.) Bpk., what is the procedure? Does the licensee in such cases apply for the remission or, as I think the Minister indicated, does the Secretary himself determine what the remission should be on conversion of his licence? What is the procedure followed here?

I imagine he would not know unless it is applied for.

Vote put and agreed to.

On Vote No. 16.—”Customs and Excise”, R1,004,350,

Under Item G, “Ex-gratia refunds of customs duties”, could the hon. the Minister give some details of the item referring to Messrs. M.S.D. (Pty.) Ltd., R35,178?

Item 224 (b) of the old Customs Tariff made provision for duty-free importation of “such preparations for the eradication of disease in stock as may be approved by the Minister”, and, under this provision, a preparation containing the drug thibenzole as active ingredient was approved by the Minister. M.S.D. (Pty.) Ltd. later decided to make the preparation in the Republic and, as a result of a request by the Division of Veterinary Services to ensure that adequate supplies of the preparation are available, placed large orders for the active ingredient under the misapprehension that the ingredient would also be admitted duty-free under the above quoted tariff provisions. When the mistake was discovered the importers made representations to the Board of Trade and Industries immediately and the board recommended that the ingredient be admitted under rebate of duty, but in the meantime the company had paid the duty; it was legally payable, and under those circumstances the necessary rebate provision was created by Government Notice on 16 November 1962, but, as a result of the urgency of the matter, certain consignments on which the duty amounted to R35,178, were required and had to be cleared before the date of publication of the notice. The importers did not include the duty in the price of the preparation to the public, and in all the circumstances of the case it is recommended that Parliament approve of an ex gratia refund of the duty involved. It was only a question of a week or two; the company satisfied the requirements, and the whole object was to give a refund of duty for this preparation as a whole. This was a more profitable way to South Africa of obtaining the preparation.

Can the hon. the Minister give us the reason for the very big increase in Item F? The original estimate was R3,631,500 and the revised estimate is the best part of R1,000,000 more.

This is the annual provision that we have to make. These payments are all made as a result of the customs agreement of 1910 between the Republic and the High Commission Territories. The agreement provides for the payment to the Territories of a reasonable portion of the duties collected in the Republic on goods which are sent to the Territories for consumption, and vice versa, and the payment of the duties“ except excise duties on spirits, beer and wine manufactured in the Republic, which were excluded because the Territories wanted to exercise control“will not depend upon covering documents, but will be made on the basis of paragraph 12 of the Schedule to the South Africa Act of 1909. On that basis these payments represent a fixed percentage of the collections in the Republic and the Territories. We could not go and calculate every year what amount went through, but they had a fixed percentage which amounted to 1.31097 per cent for all three of them, divided as follows: Basutoland, .88575 per cent; Bechuanaland, .27622 per cent; and Swaziland, .149 per cent. Prior to the financial year 1956-7 these payments were made as a draw-back from revenue as required by the South African Act, but, as a result of discussions in the Select Committee on Public Accounts, it was decided to make provision in the Estimates of Expenditure and to vote it for the year. The estimated amounts due to the Territories are as follows: The original estimate was R2,780,000; the revised estimate is R3,490,000, and it is a difference of R710,000 that we are being asked to vote here. The amount due to the Territories was under-estimated as a result of the increase in customs and excise collections for the whole of the Republic. The amount was higher than we anticipated and, therefore, their percentage was calculated on the amount anticipated by us at the beginning when these original estimates were made as to what the total imports of the country would be. There is a big increase in the figure and, as their percentage is a fixed percentage, they, of course, have to share in the increase.

The figures that you have given here are not the figures that we have in front of us, at the bottom of page 8.

There is also payment to South West Africa. The original estimate was R850,000, and the revised estimate is R1,020,000; that is an additional R170,000, which brings the total to R880,000.

May I just ask the hon. the Minister to which other neighbouring states apart from the Protectorates reference is made in these Additional Estimates?

The only other territory apart from the Protectorates is South West Africa.

Will the hon. the Minister be good enough to deal with the refund or the remission to the Bantu Trades Fair Association, Item G, R7,160.

Representations have been received from the Bantu Trades Fair Association regarding the customs duty paid on certain inflatable nylon marquees imported and used by the Association, which is registered as a non-profit company, for the exhibition of local products and manufactures to the Bantu. There is no provision in the law for this duty-free admission of the marquees and equipment, but in view of the nature of these exhibitions, and because it is a non-profit company, it has been decided to recommend that an ex gratia refund of the duty amounting to R7,160 be approved.

Vote put and agreed to.

On Vote No. 18.—“Transport,” R1,711,700,

I would like the hon. the Minister to give us some explanation for the increase of R1,500,000 in Item L, “loss on operation of railway Bantu passenger services to and from Bantu townships”. I should like the hon. the Minister to tell us whether the Department worked out the original estimate on the basis of costs, or whether this was just an arbitrary calculation.

May I just take the question asked by my colleague one stage further. Was this amount based on the existing formula or was it an estimate? Could I also ask the hon. the Minister whether this amount of R1,500,000 has been taken into account in the current year’s accounts of the Railway Administration?

It has nothing to do with the Railways.

Under the same head, may I ask the hon. the Minister whether this loss is occasioned by subsidies and, if so, will he tell us who are in receipt of the subsidies?

To which subsidy is the hon. member referring?

I refer to Item L, “Loss on operation of Railway Bantu Passenger services to and from Bantu townships”. Are the passenger services operated solely by rail or by road? Will he tell us if the road services are operated by the Railways or by private enterprise? If these services are operated by private enterprise, on what basis is the subsidy paid?

The additional amount asked for is about a quarter of the original amount. Can the hon. the Minister tell us whether, in the course of years, this amount would increase at the same tempo or whether it will be a stable amount?

Order! The hon. member can only ask for the reasons for the increase.

My question is only whether this amount will increase at the same tempo in future?

The hon. member must put that question to the hon. Minister of Railways. The Rules of the House do not allow the Minister of Transport to reply to her.

Hon. members know perfectly well that the Railway Administration sends an account to Treasury in regard to the anticipated loss on these services in the ensuing year. The accounts are made up periodically and then the adjustments take place. All that my Department has to do with the matter is to have the amount debited to my Vote and paid by Treasury. Hon. members are quite aware what the position is. The principle has been accepted over the years in regard to the building of new Bantu railway lines that all losses are subsidized by Treasury. The House has accepted that principle in every Construction Bill that has come before the House. Obviously this will increase because new lines are being built; a new line is being built to Chatworth.

My reply to the question raised by the hon. member there is that this only concerns railway services, not bus services or private services.

Will the hon. the Minister concerned—I hesitate to mention the portfolio—deal with Item M, “construction and maintenance of national roads in the Transkei”, and give some indication of the reason for the additional amount of R60,000 we are being asked to vote?

I can only deal with the reasons for the increase. Hon. members know that the provincial administration is responsible for the construction and maintenance of roads. The provincial administration advised my Department that they required R60,000 in addition to the amount originally estimated.

I appreciate the difficulty of the hon. the Minister in getting information from his colleague, the hon. the Minister of Railways, but the additional amount to be voted here is a 25 per cent increase of the original estimate under Item L. Can the hon. the Minister tell us how this large loss was incurred; to what is it due?

More passengers and more services.

It could, of course, be due to either more passengers or fewer passengers.

Probably more passengers.

It was probably due to the increase in the number of Bantu in the urban areas.

Order! The hon. member cannot pursue that question any further.

Vote put and agreed to.

On Vote No. 19.—“Social Welfare and Pensions,”—R1,360,000,

Under H there appears an item of approximately R1⅓ million. It says “Civil Pensions, Gratuities and Other Benefits”. May I ask the hon. the Minister who is going to benefit by this?

Provision is made under this head for four different types of service. The first is pension benefits and allowances to dependants in those cases where persons have not contributed to a pension fund or where persons retire from the service before they have reached the pensionable age. To give an example: A large number of non-Whites are not members of a pension fund. They attain the pensionable age. Although allowance has been made for a normal increase in this service, it appears that it will be inadequate to cover the additional expenditure. It is an incalculable factor. You do not know how many there will be.

The second is compensation payable in terms of either the Workmen’s Compensation Act of 1941 or the Government Service Pension Act of 1955. Government employees who have sustained injuries while on duty have to be compensated or their dependants in case of their dying as a result of such injuries. Because the services have been expanded the number of accidents have also increased. I think for instance of the accidents amongst the police and amongst men in the army. Because the number of accidents has increased the compensation has increased. When the number of accidents increase we have to pay more compensation. You can never determine exactly how many accidents there will be.

The third is temporary allowance, bonuses and supplementary allowances to civil pensioners in terms of Section 47 of Act 33 of 1943. Additional benefits are paid to university and technical college staff on retirement. A large number are involved, not only in technical colleges. Hon. members will remember that provision was made in the Additional Estimates for the current financial year for an amount of R245,000 for supplementary allowances to White civil pensioners. The object was to guarantee the White civil pensioner a minimum income of R42 in the case of single persons and R84 in the case of married persons. Because of the limited data at our disposal the amount to be spent on this service was estimated too low and it is now estimated that an additional amount of R700,000 will be required. Hon. members will remember that in the case of civil pensions and social pensions, which are separate entities. We did away with the social pension and introduced the supplementary pension. By introducing that supplementary pension we ensured that the pensioner would receive a minimum income of R42 in the case of single persons and R84 per month in the case of married persons. I must say there was a sample test. Because of the limited data available the expenditure on this service was under-estimated. This is another case where we do not know how many will have to be covered by this procedure. It is now estimated that an additional amount of R700,000 will be required. I might just say that this additional expenditure is largely met, as hon. members can understand, by the savings on social pensions and allowances which have been withdrawn because of the granting of supplementary pensions. The one wipes out the other partly but not quite.

Then we have the cost of the corresponding supplementary allowance paid to railway pensioners. That is borne by the Railway Administration until a male pensioner reaches the age of 65 years and a female pensioner the age of 60 years. After that the Central Government assumes responsibility for the additional expenditure. This expenditure was estimated at R200,000. This is another case where we had to get the data from the Department of Railways. After they had gone thoroughly into the matter it appeared that we had under-estimated. It was estimated at R200,000 and it is now dear that there are more Railway pensioners who will qualify for the supplementary allowance than originally anticipated and a further amount of R530,000 is required to cover the additional expenditure. Hon. members will realize that the effect of the whole process is that nobody will receive less than he received previously but that under this arrangement many will receive more than they received previously. I therefore think this is expenditure that can be recommended without any reservation.

May I ask the hon. the Minister whether all the cases which had to be adjusted with the Railways have now been so adjusted?

I have given the reasons for the increase. I can tell the hon. member that this is of course a very difficult return to make. There are thousands and thousands of files in my office. The same applies in the case of Railways. I am not saying there have not been oversights but I can assure him that if there are cases which have been overlooked we shall attend to them.

May I ask the Minister whether as a result of this change in the payment of the actual pensions to the recipients there has been any change in the taxable aspect as well. The Railway are paying out and the money is being refunded to them by the Department of Pensions. Has there been a change in this process in respect of the taxation proposals?

I am afraid I can only reply to the reasons for this increase in this item on the Additional Estimates.

Vote put and agreed to.

On Vote No. 21.—“Public Service Commission”—R1,810,

I shall be pleased if the hon. the Minister will give us the reasons for this ex gratia remission to E. A. W. Peters.

This Mr. Peters was granted a bursary by the Public Service Commission of R400 per annum for three years, i.e. R1,200, on condition that after completion of his studies he would enter the service of the State for a period of four years. The subjects he took were geology and physics. After he finished his studies in 1961 he was appointed in the Department of Mines as a junior geologist. After he had served in that capacity for about two years he unfortunately developed a serious mental upset as a result of which he was medically examined and found by the doctor to be completely unfit to carry on with this or any other work in the Public Service. The result was that he was dismissed. An amount of R1,200 then remained outstanding plus approximately R610 interest, because the interest is calculated at 10 per cent. That came to R1,810 and because he cannot pay this back—he is unemployed—we have to write it off and that is being done by way of this ex gratia remission.

Vote put and agreed to.

On Vote No. 23.—“Education, Arts and Science”, R1,325,200,

In connection with Item G—“Financial Assistance to Universities and Bursaries for University Education”, I shall be grateful if the hon. the Minister would give us a break-down of this figure and tell us which universities will benefit. What portion will go to the universities and what portion will be used for bursaries? What portion of this amount of R652,000 will be used for bursaries? Is this amount of R642,000 an additional amount in respect of financial assistance and bursaries or is it only in respect of one of these items?

Order! The hon. member may only ask for the reasons for the increase.

This amount is made up as follows: Subsidies in respect of interest and redemption for which no provision has been made in the main Estimates. The hon. member knows that the State has to provide 40 per cent of the interest and redemption charges. That amounts to R491,785. Secondly, compensation to the University of Natal in respect of the non-White section which has been closed and for which no provision has been made in the main Estimates. That amounts to R155,449. The third is additional expenditure as a result of the admission of more students to the non-White medical school attached to the University of Natal. That amounts to R4,162. Then there are bursaries to non-White students to undergo medical training. The actual amount required for 1964-5 in respect of 28 preliminary and first year students at R150 per student amounts to R4,200; 66 second-year to sixth-year students at R200 amount to R13,200. That makes a total of R17,400 less the original estimate of R15,150. That comes to R2,250. There were some savings in respect of holiday bonuses amounting to R1,646. That leaves R652,000.

Could the hon. the Minister please explain Item K, R2,000?

Item K is the contribution to the Co-ordinating Committee in connection with Palæontological, Archaeological and Anthropological Research along the Orange River. First of all subsistence and transport expenses for collection of specimens along both banks of the river, R500; the erection of field laboratory and store-room for material collected, R1,500. That makes R2,000. While the excavating is being done these people felt that they could perhaps gather some very good specimens.

Could the hon. the Minister tell us what he expects the ultimate amount to be expended on this research?

This is the amount for the financial year. They have already started. It is on a very small scale.

Item M is for an additional amount of R10,400 for State-aided institutions. May I ask the Minister which State-aided institutions are going to benefit and what the reason for this increase is?

The only reason for the increase is the increase in wages and salaries of non-White officials and employees working in these State-aided institutions. We require R11,939 for that purpose. There has been some savings on holiday bonuses and that accounts for this sum of R10,400.

May I ask the hon. the Minister whether he could give us some indication as to the manner in which this Co-ordinating Committee has been set up? Is it a departmental committee or it is a committee comprising various societies interested in these aspects of research?

It is all these different bodies, e.g. the Archaeological section of the Witwatersrand University. The geologists are worried. All the soil that is removed in the process of digging these tunnels is thrown into a heap and it may be that it contains very good samples of fossilized trees or skeletons or something like that. These people merely want to go there to ascertain whether there is anything of that nature. A little store-room is now being built to store the material for examination at a later stage. It is properly co-ordinated with the universities and the other bodies interested.

I would like to deal with the same item for a moment because we are very interested in this. The hon. the Minister said it was a small beginning. We hope it will go forward. I think the hon. the Minister referred to the Witwatersrand University.

It is one of the institutions.

What precisely is the controlling body that is undertaking the whole of the work? In other words, if there is co-ordination between the universities and some other body who finally supervises the whole thing? Which is the ultimate authority controlling the supervision of the whole of the work undertaken, i.e. Palæontological, archaeological and anthropological research along the whole of the course of the works which are likely to be inundated by the Orange River scheme. Which is the final body with the ultimate authority?

Mr. Chairman, that has nothing to do with this. This concerns only one matter. We are afraid that with the digging of the tunnels the soil that is dug out may perhaps contain valuable material. This soil is simply dumped there and may perhaps be lost for all time. Those people interested in palaeontology, archaeology and anthropology only want to exercise supervision there. This amount is really only to give them a little assistance as far as their travelling costs, etc., are concerned. They have their own funds. The State does not pay all their expenses. This is merely a subsidy so that these people can exercise supervision so that any valuable material that may perhaps be excavated is not lost.

Is there no central body under whose supervision this work is being done?

The Department of Education, Arts and Science is at the head and the chairman is Dr. Hoffman of the Bloemfontein Museum. The Department of Mines is also concerned.

Vote put and agreed to.

On Vote No. 27—“Agricultural Technical Services (Regional Services and Education)”,R787,000,

This amount of R668,900 represents a large increase, and I shall be glad if the hon. the Minister can explain it to us.

This amount appears here as a result of the revised rates introduced in respect of soil conservation works as from 6 February 1964. For example, the total amount allowed to be spent per farm in respect of water provision was increased from R1,200 to R1,500; in respect of paddock fencing the amount was increased from R600 to R750; in respect of the prevention of the development of brackish land the amount was increased from R600 to R750; and in respect of works for combating the development of brackish land from R1,200 to R1,500. This, of course, led to a considerable increase in the expenditure. Consequently our estimate was too low. Additional provision now has to be made. At the same time we readjusted the whole of our costing in respect of these works to the actual present cost of material and labour, whereas previously this had been based on the costs prevailing at the time. As a result we are making provision for this amount of R668,900 in the Part Appropriation.

As far as I can remember the increase in the subsidy in respect of these works exceeded the original cost by 20 per cent. Here we now have an increase of 30 per cent. Can the Minister analyze this additional amount for us?

It is not merely a matter of the subsidy having been increased by 20 per cent, but as a result of this increase of 20 per cent many more people to-day decide to carry out soil conservation works, for it has now become a paying proposition for them. It is not that they did not want to carry out these works before, but rather that they felt that there was too little encouragement. I have figures here which indicate that considerable progress has been made with these works during the past year. There has been a considerable increase in the amount granted in the form of subsidies and loans in respect of works of this type.

The hon. the Minister has not told us from which date these increased subsidies came into operation. He gave us various figures in respect of water conservation, the combating of the development of brackish land, etc. If, for example, a farmer has no need to undertake works for combating the development of brackish land on his farm, can he use the subsidy for fencing purposes? Can he use the subsidy in respect of one work in conjunction with another subsidy?

The maximum provided per farming unit for the purpose of combating the development of brackish land cannot be consolidated with the others. But the amounts provided for the watering of stock and the erection of fences, for example, may be consolidated, i.e. the R1,500 with the R750, making a total amount of R2,250. We allow these two amounts to be consolidated. The circumstances vary from one farm to another and in order to achieve sound farm planning it is extremely important for one to do this.

Vote put and agreed to.

On Vote No. 28.—“Water Affairs”, R1,171,

I do not want to start something again, as we do not want to be detained here until lunch-time to-morrow, but I wonder whether the hon. the Minister can explain this Item G—“Ex gratia remission of loan: J. C. van Heerden”

In 1954 a certain applicant, Mr. J. C. van Heerden of Alexanderfontein, Potgietersrus, applied to the Government to sink a borehole for him. He required it for domestic and for stock-watering purposes. We bored to a depth of 1,026 feet, and the borehole yielded 2,500 gallons per hour. The amount appearing here represents the total cost. On 19 September 1960, i.e. some considerable time after the borehole had been sunk, this applicant informed the Department that he had had the water tested and that the fluorine content of the water was so high that the Director of Veterinary Services had found it to contain 15.4 parts of fluorine to 1,000,000 parts of water, which in actual fact represented a poisonous concentration, and which could have a very harmful effect on the human body. The said official advised him not to use this water either for domestic or for stock-watering purposes. As the safety margin was 1.5 parts to 1,000,000, and not 15.4, this borehole was of absolutely no value to him. In terms of the regulations in force at the time persons who had made use of the services of Government boring machines and had found no water did not have to pay anything. This particular borehole was not a dry one, but the water it yielded was poisonous, and consequently it was as useless as a dry one. Therefore we are asking for this remission. Quite some time has elapsed since these events, and consequently we cannot make good this amount to this person in any other than to make provision for it here.

When was it discovered that the water from this borehole was poisonous both to human beings and to animals?

But I have told you. In 1960 he complained that there was something wrong with the water. In the same year the Veterinary Department at Onderstepoort advised him in definite terms that it was dangerous to use that water for either human beings or animals.

Can the hon. the Minister give us any further information in regard to L( 3).—“Extra-statutory Subsidies”

This amount of R1 in actual fact represents an extra-statutory subsidy amounting to R405.7 that was paid to the Mortimer Irrigation Board. The application for this subsidy was considered by the Select Committee on Irrigation Matters. It was recommended by the Select Committee on page 572 of its Report dated 4 June 1964. But, as we have the funds to pay this amount to the Mortimer Irrigation Board, we are merely indicating it in the Estimates in the form of R1.

Business suspended at 6.30 p.m. and resumed at 8.5 p.m.

Evening Sitting

I would like to take this question of Item G.—“Boring Services”, a little further. Could we have an explanation from the hon. Minister in regard to this hole that was bored by his Department for Mr. Van Heerden? I believe the Minister said that in 1960, six years after the hole had been bored, it was suddenly discovered that the water for cattle and human drinking purposes was useless and was found to be poisonous, and the Minister feels that in those circumstances a remission should be made to Mr. Van Heerden in respect of any further commitments he may have had in the granting of a loan from his Department for the boring services in respect of this particular borehole. This rather puzzles me, because, as I understand the regulations of the Minister’s Department, when a hole is bored for drinking purposes, tests are made by the Minister’s Department before the hole is handed over, to see if the water is of satisfactory quality for drinking purposes and that it does not hold any poisonous substances that may be detrimental to animals. As the hon. Minister knows, in the area of Potgietersrust, where this hole of Mr. Van Heerden is obviously situated, it does occur from time to time that where holes are bored for water certain holes do render these poisonous substances and that the water is found unsuitable. What I cannot understand is that, after six years, it was found that the water was unsuitable. Presumably Mr. Van Heerden has had the use of this borehole for six years. Did any of his cattle die? Did Mr. Van Heerden or his family or visitors find themselves to be poisoned? Suddenly, six years later, this was apparently discovered, and now, in 1964, we hear from the hon. Minister that this remission should be given to Mr. Van Heerden in respect of his commitments. Obviously other points arise from that. The hon. Minister is well aware that certain subsidies were granted in respect of this borehole. May I ask if this amount of R1,170 is taking into consideration any subsidy that may have been granted to this particular applicant in this particular instance? There is a further principle at stake. The hon. Minister well knows that in this area of the Transvaal, where this particular hole is situated, numbers of holes have been drilled by his Department which have yielded no return at all, or 100 or 200 gallons for drinking purposes, and that the hole, after a very short while, has dried up. The farmer still has to fulfill his commitments to the State. But here is a case where, six years after the actual hole was drilled, this particular farmer is allowed to forego his indebtedness to the State, after getting six years’ benefit out of the hole, whereas others, whose holes have dried up, have to continue to meet their obligations to the State. Where does the principle come in? Why in this particular case must there be these particular circumstances that entitle this particular applicant to get a remission of such a large amount? I think the hon. Minister must give us a far more detailed explanation, because we are not satisfied with the explanation the hon. Minister has given in this case. On the surface it looks a most unsatisfactory position, and I hope the hon. Minister will now rise and give us the particulars.

I do not blame the hon. member for wanting more information, because I notice that in his case it is particularly necessary that he should be given information. He spoke about principles. May I refer him to the boring regulations that were in force in proclaimed Government boring-areas in 1964? I propose to deal with this at some length because my reply may serve also to enlighten other hon. members apart from the hon. member. For the purposes of boring-services the Republic of South Africa was divided into two parts at that time. The part situated north of a certain line that was drawn at that time enjoyed certain privileges and could make use of Government boring services upon certain terms and conditions that did not apply in the other areas lying south of that line. The people north of the line included, inter alia, the people in Potgietersrust, where this Mr. Van Heerden lives, and the boring-regulations that were in force there at that time were such that when a farmer applied for the services of a Government boring-machine and awaited his turn and eventually obtained these services, he did not have to make any payment to the State where a borehole was sunk, whether to a depth of 1,000 feet or more than 1,000 feet (as in this case) and no water was found. In that event he paid nothing and the State bore the cost. If he found water, however, he had to pay the State according to a certain rate. The factor that determined whether a bore-hole was a dry one or not was not the quality of the water, but the quantity of water—usable water—that was obtained. In actual fact, however, the amount to be paid was based on the quantity of water obtained, and the minimum was 60 gallons per hour. You may get a case where the water from a particular borehole, in this case one that yielded more than 2,000 gallons per hour, is perfectly good to the taste. The Department of Water Affairs tested the water from this particular borehole at the time to see whether it met the requirements. To all intents and purposes it was unnecessary to carry out the test, for the bore-hole obviously met the requirements. The water was good to the taste, the animals drank it and the people drank it, and everything was fine. Hitherto it has never been the function of the Department of Water Affairs to determine whether there are any harmful elements contained in any water that is found; to go along and make analyzes for farmers. Nor has it ever been our responsibility, when sinking a bore-hole and finding water, to give a guarantee that the subterranean water that is found will provide a perennial supply or only a temporary one. How would we know this? Enormous and intensive geological surveys would have to be carried out to establish this, and in my opinion the science of geology has not yet advanced to a stage where it is possible to determine what the position is, and I do not think there is any country in the world that can determine whether a subterranean source of water will be a permanent one or not or whether it will perhaps dry up unseasonably. It cannot be determined in advance how long such a water supply will last. Consequently the regulations in force at the time were more concerned with the quantity of the water and the question as to whether it was usable. This water we usable. I do not know what the particular circumstances were that caused this man to go to the Director of Veterinary Services and to tell him that he thought that possibly there were symptoms of deterioration or disease amongst his stock; but the fact of the matter is that eventually, six years later—I understand the water is still there in this same hole—it was established, after the water had been analyzed and various tests had been carried out, that this water was harmful both to human beings and to animals. For the information of the hon. member I may say that there are areas in the North-Western Cape where even to-day people are drinking water containing fluorine, water which is perhaps not as harmful as this water but which nevertheless is fairly detrimental to the health of human beings and of animals; but because the effects are slow in making themselves felt, and because there is no other water available, they do drink it. I am merely stating facts. However, once we have established that water is particularly unsuitable, or is unusable, owing to its tremendously high fluorine content, what we do in effect simply amounts to this that a bore-hole that has been sunk and that yields a considerable quantity of water, but the water of which is not good enough for constant use by human beings and/or animals, in other words, water of which is declared useless, is dealt with as though it were a dry bore-hole. Unfortunately it was only much later that this man established that the water was harmful. We made certain investigations. As a matter of fact, I want to mention that the State subsequently went along and sank other bore-holes on the same farm, and that when we found that the water from these boreholes had the same fluorine content, a geologist from the Department of Mines was sent to that farm. His geological survey and report indicated that he certainly would not recommend that the State should ever again bore for water for domestic or animal consumption on that farm. That gave us all the more reason to come to Parliament in this case and to say that since the State had sunk a bore-hole for that man and was therefore responsible to provide water for primary use, and also in view of the report we subsequently obtained, and in the light of other tests we carried out on that farm, we were justified in asking Parliament to remit the amount due to the State by this man. That is the position.

I appreciate the point made by the hon. Minister in respect of this particular farmer, but what I cannot understand is why it took six years to find this out.

That is not my responsibility to find that out, it was his responsibility to find out whether he could make good use of the water.

But he did make use of it for six solid years.

But afterwards he found out that the water was not suitable.

Let us assume that that is correct, can we then take it that whenever there is a suspicion on the part of a farmer who has made use of the boring services of the Minister’s Department that the water is not suitable because his cattle are not maintaining condition, that everyone of those farmers can come to the Minister and say: “Look, I want a rebate in respect of my indebtedness because I am suffering stock losses.” Because that is what the Minister is saying.

I almost felt inclined to speak in my second language, English, so that the hon. member might perhaps understand me better, but I know that he can understand Afrikaans well, but is feigning ignorance. The point is simply that it is not the Department’s responsibility to determine whether or not the water is usable. If I have carried out the boring-work for a man and have rendered him the assistance that the State can render a man by means of its boring-services, and success has been achieved and water has been found, then surely it is that man’s responsibility to make out a case and to come and tell me that it was not such a success as my Department thought it was. It is not my responsibility. Has the hon. member ever considered how much additional Government expenditure there would be if I, as Minister of Water Affairs, had to accept the principle that it was the responsibility of my Department and of the Government to do all these additional things for the farmer and to determine the value and the usability of his water? Surely this is something that can be determined by the man himself.

Vote put and agreed to.

On Vote No. 30.—“Indian Affairs”

R127,000,

I wonder whether the hon. Minister can give us some information in regard to Item N “Child Welfare”, where the actual increase is R60,000, of which R33,000 is to be met from savings on other sub-heads, and an additional amount of R27,000 has to be voted?

This increase is due to the fact that during the past year payments have been mechanized and as a result payments can now be made in the same month instead of only in the course of the next month, as was the case previously. The result is that in the course of this financial year we now make 13 payments to the beneficiaries and not 12 as normally would be the case.

Vote put and agreed to.

On Vote No. 31.—“Commerce and Industries”, R574,335,

I should like to draw the Minister’s attention to Item E “Miscellaneous Expenses”, where the original estimate was R26,500 and the revised estimate appears as R206,500, an increase of R179,335. There seems to have been a very gross underestimate in respect of this amount. It deals with border areas, and I would like to know from the hon. Minister whether this includes amounts which have been voted to the Industrial Development Corporation for the border areas and what the reason is for the increase?

In amplification of what the hon. member for Pinetown (Mr. Hopewell) has put to the Minister, I would like to know precisely what this is intended to cover and why the words “nominal provision” are used. It seems to me that “nominal provision” is inappropriate.

Order! The hon. member can only ask the reasons for the increase.

Sir, I am asking why the words “nominal provision” are used in view of the fact that R206,500 are being appropriated. The other aspect I would like the hon. Minister to explain is the footnote which says that this amount “includes rebates on railage in respect of articles manufactured in the Transkei/Ciskei complex for consumption within the Republic”

Order! The hon. member must ask questions in regard to the increase.

Sir, that is what I am doing.

The hon.

member is now suggesting reasons for the increase.

I am asking for the reason as to why and how this amount includes a rebate on railage in respect of articles manufactured in the Transkei and the Ciskei for consumption within the Republic. I am asking the Minister to explain this aspect in relation to what the appropriation is for.

I would like to ask the hon. Minister to explain the losses made on housing schemes, which also falls under E.

I shall be grateful if the hon. the Minister will give us full details concerning the railage rebates in respect of goods manufactured in the Transkei/Ciskei complex for consumption within the Republic. We should like to know what the goods are. what the amount of the rebate allowed is and what assurance the Minister has that these subsidized goods do not compete with goods which are already being manufactured inside the Republic.

This amount is actually R180,000 but because there has been a saving under other sub-heads of R665 the amount asked for here is R179.335. This amount reflects the desire of the Government to promote the decentralization of industries to the Eastern Cape, namely, the Ciskei/Transkei area. As hon. members will know, from an industrial point of view, that area is faced with very serious problems and is in many respects a backward industrial area. The White areas which surround non-White areas are in particular not areas blessed with afforestation, mining and agricultural activities as in the case of other areas of the country. It is an area where there is a scarcity of the raw materials which can form the basis of industrial activity. Basic facilities such as power, water and transport are inadequate and hon. members who know that area will know that coal is much more expensive there than in other areas of the country, that electricity is much more expensive and that they have railway problems.

Order! Will the hon. the Minister confine himself to explaining the reasons why the amount is larger than the original amount.

In that case, Sir, I shall say that because of the leeway this area has to make up the Government has decided to give a rebate of 10 per cent on goods manufactured in that area and sold outside. There was a danger that industries would close down and some have already closed down; others did not want to expand for the very reason that that area had remained behind and because of the difficulty they had in regard to railway facilities. In order to assist that area the Government has decided to grant a 10 per cent rebate on goods manufactured there and exported to areas outside.

To whom is it paid?

It is paid to the industrialists in that area who manufacture the goods and export it to the Republic, outside the area.

There is a footnote

which says “Includes rebate on railage in respect of articles manufactured in the Transkei/Ciskei complex for consumption within the Republic”. Mr. Chairman, may I draw your attention to the fact that this is a new item in that sense and that it was not included in the original Estimates, as far as I know. Therefore, with respect, Sir, I want to say that as far as these railage rebates are concerned we ought to have the right to discuss this matter.

No, the footnote is only by way of information.

I would like to have some more information about this increase and the reasons which account for the increase. When did the Government decide to grant these rebates? Why was it not done at the time when the original Estimates were before the House? Was it done during the recess? In that case, and according to the information supplied by the hon. Minister, this is a new item and we are entitled to ask the Minister to give this Committee certain assurances. Before I take it any further, I should like to know what type of item does it refer to? The Minister very kindly gave us considerable details about the motives and the reasons for this rebate; and he described the Ciskei area. Quite obviously this is to assist factories that are already in existence in the Ciskei and the Transkei. What do they manufacture? What goods are being subsidized under this item?

Order! I cannot allow the hon. member for Yeoville to discuss this matter. Only the reasons for the increase can be discussed now.

On a point of order, Mr. Chairman, the Minister has just told us that the decision to pay rebates was taken during the recess. If I am wrong the hon. Minister can please tell me. May I ask the hon. Minister whether the decision to pay these rebates was taken before or after the main Estimates?

The rebates were introduced after the prorogation of Parliament last year.

That is all I am interested in, Mr. Chairman. I think it is in the public interest to know what type of goods are being manufactured in the Transkei and the Ciskei upon which these new rebates are being paid. We want to be assured that no goods are being subsidized in this fashion that will compete with the manufacturing industries already existing in the Republic. As a matter of principle and as a matter of policy, I want to ask the Minister to give us full details of the rebate being paid on goods manufactured in those territories.

When the hon. Minister brought his Estimates last year, he indicated to us that he required R26,500. Now the Revised Estimate is R206,500, involving an increase of R179,335. This is a substantial increase. The Minister has so far indicated his general policy, and you, Mr. Chairman, has indicated that that cannot be discussed because that was dealt with under the original Estimates. But Sir, there has been a change since we last debated this matter, and the Minister has conceded that there has been a change. Therefore we want to know why there was this substantial increase of R179,000, and we are entitled to have details in this regard so that we can find to what extent this involves industries in the Transkei and the Ciskei. We cannot make suggestions, but we can ask the hon. Minister for instance whether this includes the Lord organization, and if so, how much is attributed to the Lord organization, because it is obvious that these rebates were introduced after the House adjourned, after last session, and we are asking the hon. Minister to give us details.

When the hon. Minister replies, will he also deal with the second question here, and that is the losses on housing schemes and “other subsidies and losses”. I hope the hon. Minister will be able to break down the “other subsidies and losses” and give us some details, because that language is so wide that it might cover the bulk of the R180,000 that is now being asked for. The hon. Minister smiles, but we do not know what the “other subsidies and losses” are. The Minister has referred to rail rebates, but what are the other subsidies and what are the losses, under what sub-heads do they fall? Are the subsidies in respect of housing schemes? Where are the housing schemes that are being subsidized? What are the “subsidies and losses”? We want to know what we are voting the money for.

I wish to ask the hon. Minister two questions in regard to sub-head E. The first question is that this item refers to a “nominal provision”. In the hon. Minister’s reply he gave no indication of his long-term expectations of the ultimate amount in respect of which this is a nominal provision. He dealt with the policy, but he gave no indication of how far this was “nominal”. We have gone up some 750 per cent, from R26,000 to R206,000, over 700 per cent increase, and we have asked the hon. Minister to give us the reasons. He has dealt with policy, but did not indicate whether the R26,000 is nominal or whether the R206,000 is nominal. If, within the course of this year, the amount can increase by 750 per cent, and R206,000 becomes a nominal amount, what will the ultimate amount be? I feel that the hon. Minister owes this House and the country an explanation of that, particularly with regard to this new item, the question of the subsidies. The second question is that in regard to the footnote, there is a reference to the Transkei/Ciskei complex. Those are not the only border areas, and I feel that the hon. Minister should indicate why the Transkei/Ciskei, and not other border areas, such as the Natal border areas, such as cities like Pietermaritzburg, are not included, why Rosslyn near Pretoria are not included. Why should a policy designed for border areas suddenly be restricted to one complex, in terms of the footnote? The footnote refers only to the Transkei/Ciskei, but the item is “Development of border areas”. Are we now having an A-class border area, a B-class border area and a C-class border area? It says here “Development of border areas”, but the footnote qualifies it as “Transkei/Ciskei”. Are we to have a T-class, the Transkei class of border areas which falls in a different category and is entitled to different privileges from the other border areas? This matter is far too important and far too vital for the hon. Minister to get away with vague generalizations. This is part of the fundamental policy of the Government, and the Minister cannot get away with vague generalizations when he has an item on the Estimates, a new item, in respect of which we are entitled to ask, not merely a general statement on the Government’s ideas and principles, but the detail of what is going to happen. What is the Government doing about this? Is this only applicable to the Transkei, or is it going to be extended until the R260,000 which we are asked to vote is itself a nominal amount? Finally, I want to ask the hon. Minister to state categorically here to-night that this establishes a new principle that Consolidated Revenue is to subsidize the South African Railways in regard to the transport of goods in the national interest at lower rates; in other words, do we now to-night establish the new principle that Consolidated Revenue will pay to the S.A. Railways or to the producers—whichever way you work it, it is a subsidy on transport—a subsidy in regard to any transport which the Government feels should be carried out at a lower rate than that laid down by normal railway tariffs—any class of goods? We have at the moment special tariffs for agricultural products, exports, and so on, which enjoy preferential railway tariff rates. Now we are faced with a different principle that the Railways are not granting special tariffs for these goods which are required to be transported in the national interest, but that Consolidated Revenue is now paying the Railways the difference between normal tariffs and what the Government believes is necessary as an overall policy. We are entitled to ask if this is an isolated question, or is this part of a new Government policy whereby Consolidated Revenue will now subsidize Railway transport to provide cheaper movement of goods if that movement is required at a cheaper rate in order to carry out the Government’s ideological policies? I think we are entitled to a clear explanation from the Minister on that issue.

May I ask the hon. Minister whether any buildings have been erected by industrialists in this area and, if so, by whom?

Order! The hon. member is not in order.

I am asking for details.

On a point of order, Mr. Chairman, the hon. member is asking for the detailed reason of the increase in respect of this item.

The hon. member is suggesting the reasons for the increase.

I would like to ask the hon. Minister with regard to the moneys he is providing in the category “other subsidies and losses”, which is virtually the issue we are dealing with, namely the rebate on railage in respect of certain articles, what type of goods is he assisting, because he obviously has had representations made to him in respect of certain types of goods. We are particularly interested in the types of goods that are being protected and also in whether he is taking into account what the competitive relationship will be between the manufacture of those goods and goods manufactured by other manufacturers in the country. Has the Minister also taken into account the fiasco which at one time occurred in the clothing industry. Are these rebates to cover textiles? Are they to cover leather goods? Are they to cover agricultural supplies, etc.? I think the Committee is entitled to know what the hon. the Minister has in mind. It is all very well to come to Parliament and say that this is an additional item and that it is something which occurred during the recess. I think the hon. the Minister owes us a complete explanation of his policy as has been requested. More particularly he owes us details because the Committee is being asked to pass this item and therefore the Committee, in accordance with the normal Parliamentary traditions, is entitled to know exactly what it is being asked to pass.

Mr. Chairman, the hon. member for Durban (Point) (Mr. Raw) referred to “vague generalizations”. But it is not true to say that I put forward vague generalizations. On the contrary. I was indicating on the basis of facts what was happening in the Eastern Province, around the Ciskei-Transkei area. I was merely giving hon. members the facts …

What are the facts?

Must I repeat them? I indicated that that area was at a disadvantage as far as raw materials was concerned, as far as markets were concerned, as far as power and water were concerned, as far as coal was concerned and in many other respects. I also pointed out that industries were leaving that area; that industrialists refused to establish or to expand industries there and that we had received representations in this connection. I should like hon. members who represent that area to stand up and tell us what they think of the situation there. Let the hon. member for King William’s Town (Mr. Warren) and other hon. members who represent constituencies in that area stand up and tell us what their attitude is with regard to this matter. Here we have a forgotten area, an area that we should like to develop for various reasons, one of those reasons being that there is unemployment in that area, and there is only one way in which we can provide opportunities of employment for the unemployed in that area and that is by attracting industries there.

Hon. members constantly talk about the decentralization of industries. We are constantly told that we should decentralize our industries, but as soon as we take steps to decentralize industries hon. members opposite immediately become suspicious and whatever we do is supposed to be done in pursuance of our “ideologies”. [Interjections.] But even if that statement were true, here we have a case of industrial decentralization, of uplifting a forgotten area industrially. The method that we are following here is only one of the methods; another benefit that will accrue to border industries is a rebate to factories on railage payable to the markets.

The hon. member for Durban (Point) wants to know whether there are different types of border areas; whether there are A areas, B areas and C areas. No. Border industry benefits are adapted to the needs of the particular area. Natal, for example is at no disadvantage as far as rail and marketing facilities and coal supplies are concerned. Natal’s market is not as far away as East London is from Johannesburg. For the greater part Natal can get her raw materials on the spot whereas East London and the area in question have practically no raw materials. As far as all these economic factors are concerned, the Transkei-Ciskei area is at a tremendous disadvantage in comparison with some areas of Natal. We feel that it is because of this fact that industries have not shifted to this area, and that is why we have granted this additional concession of a 10 per cent rebate on railway tariffs to this particular area.

This 10 per cent rebate will be given to every industry. Hon. members opposite have a bee in the bonnet as far as Cyril Lord is concerned. The fact of the matter is that this rebate will be given to every industry that needs it. This amount has not yet been spent. We are making provision here just for a nominal amount which is to be spent when applications for rebates are received and considered. As soon as applications are received, this concession will be given to industries to the extent that they need it, not necessarily the full 10 per cent but only as much as they need. I do not know whether the hon. member for Durban (Point) still insists that I am just generalizing.

Order! I should like to point out that the principle of subsidizing border industries was approved when the original provision was made. Hon. members must, consequently, confine themselves now to the increase proposed, i.e. a 10 per cent rebate on railway tariffs. That is all that is under discussion now.

On a point of order, Mr. Chairman. I should like to point out that the footnote to item E—Miscellaneous Expenses—says that it includes rebate on railage. What I am concerned about is this, namely that the Minister says that the amount he is asking is an amount of R179,335. I should therefore like to ask the Minister how much of that is in respect of the rebate on railage and how much of this rebate is attributable to the Transkei and Ciskei. The Minister has, I submit, thus far talked only in a general way. Consequently I should like to know from him whether the whole amount is in respect of railway rebates or whether it also includes other items and if so, what they are. If we can have clarity in this respect, we can save time.

When I last spoke I asked the Minister—and I want to repeat it now—whether he would break down the “losses on housing schemes and other subsidies and losses”. Why a loss on a housing scheme is called a subsidy I do not know but that is the way in which this item is framed, i.e. “losses on housing schemes and other subsidies and losses”. I asked the hon. the Minister for a particularization of these matters in order that we may know exactly what the losses are. This generalization, on the other hand, means nothing. On the other hand, it might mean anything.

I cannot reply to this question because what we are busy with here is only the reasons for the increase. These reasons concern only the amount of R179,335 applying to the rebate only. We are therefore only talking now on the question of the rebate on railage. It has nothing to do with subsidies on housing, etc. That falls under the amount of R26,500 which has already been voted. The entire amount of R179,335 constitutes a rebate on railage.

On a point of order, Mr. Chairman. I ask you for your ruling in respect of this matter. You have already indicated that this amount is part and parcel of the provision made when the Estimates were first before the House. The point I now should like to put specifically to you is that there is no indication about any rebates at all. This item speaks of subsidies, but not of rebates. The question or rebates is a new one and consequently I submit that this Committee can discuss the question of rebates fully.

Only in respect of this particular area.

The hon. the Minister has indicated that this amount of R179,335 is only a nominal amount. He stated that everything was in respect of rebate on railage but I also understood him to say that it was a nominal amount in respect of rebate on railage for this area. That is what I understood the Minister to say. The Minister must quite obviously be aware of the fact that this question of rebates—which really amounts to a subsidization of industries in respect of railage in the border areas in this Transkei-Ciskei area—was the subject of a special report which his colleague the Minister of Transport, received fairly recently, although he has not yet given us an indication of what his attitude is going to be in regard to it.

I want to name one reason why I think it is absolutely essential that we should have absolute clarification from the Minister in regard to the manner in which he intends disposing of this amount. The report to which I referred was quite specific in stating on page 147—

It goes on to say—

Now we are being called upon to vote this amount of money. But how are we on this side of the House to know that in this matter of the subsidization of railage on specific products, the manufacturer on the border is going to get a preferential rate to say the Reef area, a rate which will influence his costs favourably when compared with the costs of the local manufacturer? I should like to ask the Minister what steps, as the report recommends, he has taken to have an investigation carried out before granting the rebate in order to ensure that existing industries will not be affected? That, to my mind, is the crux of this whole issue. It is of no use the Minister coming with this when we have had no statement of policy from his colleague, the Minister of Transport, on an important issue of this nature. I hope, therefore, that before the Minister asks us to vote this amount of money, he is going to give the Committee more information in regard to what specific products are going to receive this rebate, because if we vote this amount of money now at the Minister’s behest, we might be prejudicing the interests of quite a number of manufacturers in other parts of the country. We do not know. Consequently I think we are entitled to have this information on who is going to get the benefit of this rebate—a rebate which amounts to nothing more nor less than the subsidization of railage out of Central Government funds to preferred manufacturers who have created their industries at the Government’s behest, within a border area. As far as I am concerned, I am not prepared to act to the prejudice of a Witwatersrand manufacturer, nor do I think the hon. member for Durban-Point is prepared to vote to the detriment of the competition area of Durban, neither a member in the Cape to the detriment of a manufacturer in the Cape.

Will they vote against Bellville?

Is the Minister of Planning, who has quite a number of industries in his constituency, prepared to vote this money to the detriment of, say, a brassiere manufacturer in his constituency?

So you see, Mr. Chairman, the matter is not such a simple one and therefore I think we are entitled to far more information and to a far clearer statement of policy than what we have had hitherto. I want to ask the Minister straight: Does he stand by the recommendations of the report of the Schumann Committee dealing with this matter specifically? [Time limit.]

Mr. Chairman, the hon. the Minister now owes the committee another explanation, i.e. an explanation of the meaning of the words “erection of industrial buildings and/or losses on housing schemes”, We have here before us an item where we are asked to vote an additional amount of R179,335 as a nominal provision in respect of subsidies …

Order! That is on the original estimates.

With respect, Mr. Chairman, I am referring to these additional estimates.

Order! It

has been stated quite plainly that the amount of R179,335 is in respect of railage rebates and nothing else.

I accept your ruling, Mr.

Chairman. Now, I submit that the wording under this item does not bring out what we are asked to vote for. I am asking your ruling on this point, Mr. Chairman.

What is the point?

I am asking you, Sir, whether your ruling means that we are not being asked to vote R179,335 for the purpose stated in item E of the additional estimates before us.

Order! That is not a point for the Chair to give a ruling on.

On a point of order. Sir. We are dealing here with a revised estimate. This revised estimate is now R206,500. This is what we are dealing with …

Order! This committee is dealing only with the increase, with the additional amount to be voted.

With respect, Sir! I submit that the amount we are being asked to vote is on the revised estimate. There is now an increase on the original estimate. It is the revised estimate which includes all those things to which the hon. member for Durban (Point) has been referring.

Mr. Chairman, if you look at the item “miscellaneous expenses” you will find that the additional amount to be voted is R179,335. If to that is added the amounts of R665 and R26,500, you will get the amount of R206,500 which is shown in the revised estimate column. Against this column there is a footnote “a” which says that this includes rebate on railage in respect of articles manufactured in the Transkei/Ciskei complex for consumption within the Republic. In the item itself the following reasons are given: i.e. development of border areas, nominal provision for subsidies for the erection of industrial buildings and/or losses on housing schemes, and other subsidies and losses. I submit that this description is misleading because the hon. the Minister now tells us that the R179,335 is in respect of rebate on railage alone. If that is so, then this item should read “additional rebates for railage”. But as it reads now, it is misleading.

Mr. Chairman …

On a point of order, Mr. Chairman. I was addressing the Committee when I was interrupted by a point of order. Am I now not entitled to resume my address to the Committee? The hon. member for Natal South Coast took a point of order while I was speaking …

Order! That hon. member must resume his seat. I have now “seen” the hon. member for Hospital.

On a point of order, Sir, the hon. member for Durban (Point) was addressing the Committee on this item and asked for a ruling from you. But before you gave your ruling, the hon. member for South Coast got up to address you on a point of order …

Order! Not

to my recollection.

On a point of order. Sir. The hon. member for Durban (Point) raised a point of order and I rose to support him …

Order! Not to my recollection. The hon. member for Hospital can now address the Committee.

On a point of order, Sir, I want your ruling on the point: How, if the hon. member for Durban (Point) was addressing you, could the hon. member for Natal South Coast get up and address the Committee if not on a point of order?

Order! After the hon. member for Turffontein addressed the Committee, the hon. member for Durban (Point) spoke and thereafter the hon. member for Pinetown. I have given my ruling and hon. members must now accept it. The hon. member for Hospital may now address the Committee.

When dealing with item E, the Minister told us that the amount of R179,335 is a provision for rebates on railage in order to keep industries in the border area where they are. and also to attract new ones. This is something about which the public and particularly industrialists should be very clear. Therefore, I should like the hon. the Minister, when he replies to this debate, to deal with the reference to the “Transkei/Ciskei complex”. Clearly, this is an arbitrary definition, because as far as I am aware, while it is possible to define the borders of the Transkei legally, there is less likelihood of that in respect of the Ciskei. But certainly, when it comes to the “Transkei/Ciskei complex”, I must say this may be a phrase of convenience adopted by either the Minister or by his Department. I think, however, the hon. the Minister should try and define what area is meant by the “Transkei/Ciskei complex”

Look at your map.

Can this hon. member, Sir, who is chairman of the Native Affairs Commission, or anybody else for that matter, show me a map on which the “Transkei/Ciskei complex” is defined? The hon. member for Heilbron may have a complex of another kind, but for the moment I am speaking to the hon. the Minister of Economic Affairs, and I am asking him to define this complex. He cannot just arbitrarily draw a line through any part or area of the Republic and say that if industry A is on that side of that line, it is within the “Transkei/Ciskei complex” and thus entitled to a part of this very large provision for rebates on railage: or that if it is on this side of that line—it may be a matter of one inch—it is outside that “complex” and thus not entitled to the rebate. Then that entrepreneur has to compete with industrialists on the other side of that line, industrialists who are getting the rebate. This is not a light matter, and it is all very well for the hon. Minister, who seems to want to give the Committee this information, to say that he has made this provision for a very good reason—for in order to encourage industries in or to a blighted area. But he still has to indicate to us what this “Transkei/Ciskei complex” comprises—that is, if he wants to make his point as far as this additional provision is concerned as effective as it should be.

There is a second point I should like to put before the Committee. We have fallen into an error perhaps, but certainly into a difficulty, over this “nominal” provision. Is the amount of R179,335 indeed a nominal amount? The hon. the Minister has not yet dealt with that matter, although it is a very important one—because just as the original provision of R26,500 has grown to R206,500, is it possible for this amount of R179,335 to grow to, say, R3,000,000? What is nominal? Who nominates? What can be the final amount involved? There are questions on which the hon. the Minister should try to give us information, despite the discouragement he is getting from his colleagues.

This is a very important debate. The hon. the Minister has challenged hon. members representing constituencies in this area to get up and state their views about the matter. This is of great importance to the Transkei. The Minister has now enunciated a new policy. He told us that this money has not yet been spent and that it was going to be spent to attract industries to this area. He spent some time in telling us that this area was not too attractive for industrial purposes, hence the provision. We have always understood the policy of the Government to be not to attract White industries to the Transkei. The footnote to this item E says “includes rebate on railage in respect of articles manufactured in the Transkei/Ciskei complex”. Industrialists may be interested in going to the Transkei. As a matter of fact, we know of industrialists who said they would be interested in going there. But now the Minister should tell us and the country what principles will apply to the establishment of industries in the Transkei. Who, for instance, will get this rebate? What type of industry in the Transkei is going to get it? I welcome this and I am hoping that this will bring the establishment of industries in the Transkei. This is what I have been pleading for every year. So the Minister owes a duty to industrialists throughout the country to say what encouragement is going to be given to industrialists to establish themselves in the Transkei. The Minister should now get up and tell us.

To my mind the hon. member who has just resumed his seat has made the best contribution to this debate so far. He wanted to know what industries to which this rebate would be granted, were going to be developed in the Transkei/Ciskei area. I do not blame the hon. member for wanting to know that. In fact, it is his duty and his task to obtain information for other hon. members on his side who are full of suspicion and who are afraid that the industrial triangle of the Transvaal, or of the Rand/Pretoria complex, or wherever it may be, industries will have to compete with industries in the Transkei or the Ciskei that receive subsidies from the State. The hon. member is quite right in saying that it is in the interests of the Transkei and the Ciskei that industries in these areas should receive support. But now he comes along and asks what industries are to be given support and what border industries are. If at this stage the hon. member still does not know what border industries are … [Interjections.]

You tell us what they are.

Order!

Mr. Chairman, if in

the midst of this tremendous noise I can sort out what is being said I should like to reply to it, but it is virtually impossible to hear what is being said. However, let me reply to the hon. member for East London (City) (Dr. Moolman), who comes from an area in which there are border industries. [Interjections.] Mr. Chairman, I shall proceed as soon as I can make myself heard.

Order!

I like to reply to interjections, particularly when I can hear what they are about, but I really cannot reply to a hullaballoo such as we have here now.

Where is the Transkei/ Ciskei complex?

Not in Hospital.

The hon. member has already received one adequate reply, namely, that it is not in Hospital. It is not in the Transvaal either! Nor is it in Somerset. East, and if the hon. member for Hillbrow were here, I would have told him that it was not west of the Fish River either. [Interjections.] The hon. member for Drakensberg can also accept for her edification that the Transkei/Ciskei area is not situated west of the Fish River; nor does it extend up to the Gamtoos. “Transkei” means “beyond the Kei River”, and “Ciskei” means “on this side of the Kei River”. However I do not think the Chairman will allow me to give a geographical description of the Transkei and the Ciskei to-night. Hon. members on the other side know very well where the Transkei and the Ciskei are. They know it very well when they come and expound here how they are going to give the Bantu areas representation too under their race federation plan. [Interjections.]

Order! The hon. member must return to the discussion of this additional amount.

Very well, Mr. Chairman. When, however, we now come along and make provision for granting support to industries in this area and for losses on housing schemes, these hon. members have no idea at all as to where these areas are. [Interjections.] Mr. Chairman, I am sure I will get into trouble with you if I again enlighten the hon. member for Hospital. But now hon. members do not know where this area is. Can you see what temptation I am faced with, Mr. Chairman?

Order! The hon. member must now confine himself to the increase in the provision. Hon. members must now please stop playing the fool.

I am going to conclude, Mr. Chairman, by saying that it is necessary to make this provision. We are making this provision because it is the policy of the National Party to develop border industries in order to prevent industries from being concentrated in the White areas alone, and also because it is necessary that industries employing large numbers of Bantu workers should go and establish themselves in the border areas. Hence this amount on the Additional Estimates for granting support to such industries. The object is not that these industries should compete with industries in the White areas. It is in the interest of this area, and, consequently, also in the interest of many hon. members on that side, amongst others the hon. member for East London (City), that industries should be developed there. I therefore say that hon. members who come and split hairs here to-night by asking for what purpose this amount has to be voted, do so with only one object in mind, namely, to sabotage the National Government in the implementation of its policy of developing border industries.

The Minister said—I am speaking under correction—that the subhead, as printed, was wrong, as it only related to railway rebates. In other words, we are not being asked to vote money for the item under Sub-head E, but only for railway rebates. The hon. member for Somerset East attacked me even before I had spoken, and I now want to tell him a few things. In the first place I want to tell him that if this House is not entitled to obtain further details in respect of the Additional Estimates it will necessarily create suspicion, and the National Party will be regarded with suspicion. It is, after all, a function of Parliament that is involved here. The hon. member for Somerset East, who lives only a stone’s throw away from the western side of the Fish River and who is not concerned in the Ciskei, who talks so glibly about the Ciskei, this side of the Kei River and the other side of the Fish River, in fact knows absolutely nothing about the Transkei/Ciskei complex. He does not know where this complex is situated, nor is the Minister able to define it for us. I wish to put a few questions to the hon. Minister, as the hon. member for Somerset East is unable to reply to them, for the reason that he has no knowledge in this regard. We all know that the Cyril Lord factory has been established in a border area …

Would the hon. member for East-London City have any objection if the Cyril Lord organization benefited from this amount?

Mr. Chairman, I am dealing with all the factories.

Do not run away now!

Mr. Chairman, I want to know specifically whether the Cape of Good Hope Mills in King William’s Town are considered to be an industry situated within the Transkei/Ciskei complex and whether the rebate will be granted to them as well. I should also like to know whether the border industries situated along the west bank of the Buffalo River, which have already been recognized as border industries—industries that are not situated within the Transkei/Ciskei complex—will be entitled to this rebate if they should require it and if their case should be a deserving one. We should like to know whether the development of the border areas is in fact so honest a policy as the Government professes it to be. Will the industries along the west bank also be entitled to this rebate if their cases are of a deserving nature? I wish to point out that the Ciskei is not being defined, that it has no specific boundaries; as a matter of fact, we do not even know whether the areas outside King William’s Town fall inside or outside the Ciskei complex. As the Minister certainly knows what the boundaries of this complex are, I should like to know from him whether he thinks there will be one single factory in the Transkei/Ciskei complex, or one factory outside this area—a factory that can be described as being a border industry—that will not apply for this rebate. We should like to have the Minister’s replies.

Mr. Chairman, I hope the hon. member for East-London City (Dr. Moolman) will forgive me when I tell him that he has avoided the question which he was supposed to answer

That is what he always does.

I should like to know from the hon. member whether he will vote for this amount if rebates to industries in the East London area are included in this increased amount. He is as silent as the grave. [Interjections.] Will the hon. member for King William’s Town (Mr. Warren) tell me whether he will vote for or against this amount if rebates for the Cape of Good Hope Mills in King William’s Town are included in it?

That was what I asked for.

The hon. member says that that was what he asked for, and he agrees that this amount must be voted by the House. He agrees that we must vote for rebates to industries in the border areas.

Yes, as soon as we know what they are intended for.

That hon. member, who lives within the complex, wants to try to make us believe that he does not know where the boundaries of the Ciskei-Transkei complex are.

Is East London in the complex?

He knows that East London is in the complex. He knows that Queenstown is in the complex. [Interjections.] Mr. Chairman, I am making a plea here this evening for industries in Queenstown. Those hon. members are speaking against industries in Queenstown. [Interjections]. Hon. members on that side may try to hide this fact. Suddenly this evening they want to give the impression that they do not know what border industries are.

Order! The hon. member for Natal South-Coast (Mr. D. E. Mitchell) must realize that when I call for order I want order.

Mr. Chairman, hon. members ostensibly do not know what border industries are. What did the hon. member for Yeoville (Mr. S. J. M. Steyn) say when he addressed a meeting at Queenstown last year? He said: “This policy of border industries is sheer madness” At the time he was speaking about “border industries” but this evening he apparently does not know what the “policy” is. The hon. member for Durban-Point (Mr. Raw) will, I am sure, remember that about two years ago he opened a fete in East London and on that occasion he had the following to say: “If you people bargain on industries under this policy you are living in a fools’ paradise”

Yes, and was I right or wrong? [Interjections].

Mr. Chairman, the hon. member was so right that the Mayor of East London as well as the Chairman of the Chamber of Commerce said to him: “Go away, Mr. Raw, we do not need your advice”. [Interjections]. Mr. Chairman, the crux of the whole matter, as far as I am concerned, is not the fencing which has been going on here this evening. Hon. members opposite are, after all, also in favour of the decentralization of industries. We are dealing here with the decentralization of industries to a certain part of our country and I am making a plea for that part of the country this evening. The areas concerned are backward economically. Those areas are also backward in the industrial sphere. We must welcome every concession which is made to those areas. I must welcome it, the hon. member for Albany (Mr. Bennett) should welcome it, the hon. members for East London should welcome it and the hon. member for King William’s Town should welcome it, but I have seen very little indication of it this evening although we are dealing here with a concession to those people.

I want to tell the hon. the Minister this evening that all the people in those areas, including myself, people of all political convictions and of all race groups, heartily support the Government in this respect and we are all in favour of these rebates because we do after all derive some benefit from them. East London is deriving all sorts of benefits to-day as a result of this policy and the time will come when Queenstown and King William’s Town will also derive benefit from it. This is our only hope. I want to emphasize the fact that if we have to rely on the natural economic factors in those border areas, if we do not receive a few additional concessions, concessions as made under this system and such as those which appear under this Vote, then we can forget about industrial development there. That is why I make an appeal to the Opposition not to continue to sabotage industries in the border areas as they have been doing here this evening.

Mr. Chairman, before I go any further I should like to refer to a remark which, according to the hon. member for Queenstown (Mr. Loots) I am reputed to have made in Queenstown last year. I apparently said then that “the border industries were madness”. I most strongly deny that I did say that.

[Inaudible.]

But that is what I have been accused of saying. What I did say was that the Bantustan policy was madness. I said so at Queenstown and I have said it throughout the country. The question which I put to the hon. the Minister but which has not yet been answered, was: To which goods will the rebate be of application? The hon. the Minister says that they will be applied in every deserving case. If this is so, then the hon. the Minister must ascertain what representations must be made by an industry in order to qualify for these concessions. We on this side are not concerned simply about the question of border industries—as the hon. member for Queenstown has tried to suggest—but we are concerned because the hon. the Minister apparently wants to have the power to discriminate between industry and industry in the border areas. If those industries are going to receive a general rebate, we can discuss the matter on a completely different basis. But we are informed that rebates are going to differ from factory to factory and from industry to industry, and that it will be in the discretion of the hon. the Minister whether a rebate will be given or not. Before we can go any further we should like to have clarity in this connection.

I do not know whether the hon. the Minister will be able to answer this question but I would like to know whether this concession will be restricted to the border industries. I want in passing to say—I hope you will permit me to do so and I hope that the hon. the Minister of Finance will also give his attention to this matter—that this is an extremely unsatisfactory way in which to frame the Additional Estimates and lay them before this House. Not only is this side of the House at a disadvantage, but your task too, Mr. Chairman, is made more difficult because this item is actually a new item. It should have appeared as a new item and not as an increase in an existing item, an item which it has nothing at all to do with. I should like to know from the hon. the Minister whether this item was inserted under sub-head E to indicate that the assistance will be restricted to industries in the Transkei. Will the rebate not be of application to other border areas and areas which do not border on a Bantu area—for example Somerset East? If this were the case of general decentralization, the hon. the Minister could have relied upon our unequivocal and enthusiastic support. [Laughter] If it is the policy of the hon. the Minister to decentralize industries to areas such as this area, an area which is backward and which needs help, then we are on his side. But has this new item not been included deliberately under subhead E, which is apparently restricted to border industries, to indicate that these rebates will only be allowed when industries are established in particular areas in order to promote the ideological Bantustan policy of the Government? We must have clarity in this regard. The position as set out in these Additional Estimates is confusing. In view of what was said by the hon. member for Somerset East (Mr. Vosloo) I take it that he is also completely confused. Is this concession to industries confined to border industries? Is it confined to industries which will serve to promote the Bantustan policy, to assist the Bantustans towards independence, or is the policy aimed at assisting all the backward areas and the people in those areas to progress and to achieve a higher standard of living?

If I understood the hon. the Minister correctly, he said that the whole of the R179,000 odd was for rebates on railage in respect of articles made in the Transkei/Ciskei complex. I should like the Minister to clear up one point for me. The heading relating to this amount is “Development of Border Areas—Nominal provision for subsidies for the erection of industrial buildings and/or losses on housing schemes and other subsidies and losses.” Will the Minister please confirm that none of this money is intended to help housing schemes or bear losses in that connection, but that it is intended purely and simply as rebates for those industries?

The money is intended purely for rebates.

The hon. member for Queenstown referred to a Fool’s Paradise.

That is what you said.

That is right. I said that if anybody believed that this policy for which we are being asked to vote now was going to cause an industrial explosion in East London, such a person was living in a Fool’s Paradise. All that this policy has created is a Cyril Lord Paradise! An East London paradise has not materialized. The hon. member for Somerset East and the hon. member for Queenstown have both accused us of opposing industrial development in terms of this policy in East London. I now put it to the hon. the Minister across the floor of this House that this policy will not assist any of the established industries in the industrial area of East London south of the Buffalo River. The industries complex of East London, where the existing basic factories of East London stand, south of the Buffalo River, does not get a single cent of this R179,000 odd. In other words, Mr. Chairman, if you have an industry and you risked your capital for 10, 15 or 20 years, battling against the “agterlikheid” which the Minister referred to, the backwardness, the difficulties, the long way from raw materials, the long way from markets, and you sustained losses over the years in the hope that you would ultimately succeed, nevertheless you will not get a single cent assistance from this Government. But if you come along to the edge of the Bantu area on the other side of the Buffalo River then you can draw on this R179,000.

Which side of the river?

On the Transkei side, on the north side of the river. The Minister is prepared to use the funds contained in the vote we are being asked to pass, to cut the throat of the existing industry of East London in favour of the ideological industry being established nine miles to the north-west of East London. If you move to where Cyril Lord has moved, to the border area where the Government has built a huge township, you will get assistance from the Government. On the other hand, if you are an established industry in East London, you will not share in this amount. Does the Minister deny it?

Nor Somerset East?

Does Good Hone Textiles get the same privilege as Cyril Lord in railage rebate? The Minister is nodding his head. Now we are getting further. I should like to know whether any industry in the Somerset East constituency shares in this rebate.

Yes.

Will the Minister tell me what part of Somerset East shares in this railage rebate? What town, what industry, what single industrialist has received one cent of this R179,000 in the Somerset East constituency or Somerset East town? Will the Minister tell us? I want to go to the next town namely Umtata. What industrialist in the Transkei and in Umtata has drawn one cent of this R179,000? I want the Minister to tell us how he has helped to decentralize industry to Umtata. We on this side of the House are in favour of decentralization in the whole of the North-Eastern Cape. The whole of the North-Eastern Cape suffers from the same disabilities as those listed by the Minister here. Every disability he listed applies to every town in the North-Eastern Cape. He cannot deny that. Now I want to ask him whether Grahamstown shares in this subsidy. Does Cathcart share therein? Does Queenstown share therein? Queenstown has had one new industry created as a Border industry. It burnt down and they are busy rebuilding it. What other benefit has Queenstown derived from this policy? Nothing. The reason is that the policy is not based on the basic economic laws of decentralization. As the hon. member for Yeoville said, we will support the hon. the Minister one hundred per cent if he will apply a policy of decentralization under which every platteland town in South Africa has an equal chance of competing for the benefits, every platteland town in every province. But we are not prepared to say that Somerset East or Durban, or this or that town, cannot enjoy the privilege, be it a big city or a modest platteland town, but that because a town is situated in the Transkei or the Ciskei, therefore it will receive benefits. If the wording appearing in the footnote means anything, it means that only the Transkei and the Ciskei will enjoy any benefits thereunder. The rest of South Africa, which needs and deserves support in building up industry, is debarred from being assisted. The Minister is quite prepared to let industrialists in his constituency be at a disadvantage vis-a-vis people whom he is prepared to assist for the sake of Black political policy purposes. He is not concerned about helping the White man in South Africa, he is not concerned about assisting White towns in the country, he is not keen to keep the White man on the platteland. All he is interested in is carrying out a Black political policy. As long as it is in alignment with the Minister’s Black political policy, certain select industries will enjoy railage rebates out of this nominal R179,000. [Interjections.] A White town without a Black area nearby can, as far as the Minister is concerned, go and whistle for assistance. A White town in the platteland, not having a Black area near it, will not receive a sixpence from the Minister. But if a town is near a Black area, industrialists in that town can go along and say, “I want ten per cent railage rebate.” That is what we oppose, Mr. Chairman. We are opposed to discrimination against the platteland towns of South Africa, including the towns of the North-Eastern Cape Province, which are placed at a disadvantage because of the obsession of the Government with Bantustan ideology. If the Minister were to stand up now and say “I will make this rebate applicable to any industry in any rural town in South Africa”, I can promise him that everyone on this side will support him. If he will extend this rebate to every industry in a White town in South Africa, we will back him. But if he excludes existing industries and he excludes areas which do not have Black reserves near them, then he cannot expect us to support a sectional policy in conflict with the interests of the White platteland population. These people are being driven off the platteland because they cannot share in this benefit owing to the Government’s policy of only assisting in cases where there are Border areas in the vicinity.

Mr. Chairman, we are prepared here and now to give our full support if—and as we are dealing with the Transkei/Ciskei complex—the Minister will assure us that this subsidy will be available in Umtata and in every town in the Transkei and the Ciskei. But as long as assistance will be available only to those towns which he nominates while other towns that need it just as badly are excluded, then we will continue to oppose it.

It is clear from the speech of the last speaker that the true aim of the United Party is to make every White rural town Black. They are not satisfied that the Bantu should remain within their own area. They now want to decentralize industries throughout South Africa’s White platteland, not for the sake of the White towns but in order to make the White towns Black by means of Bantu labour. [Interjections.] They do not want industries in the White towns. What they actually want there is Black voters for their federation policy. We on this side want industries to be established, at Heilbron as well, and our policy is very clear. In the case of White towns we want industries which are not labour-intensive. We want all the labour-intensive industries to move to the border areas where we will be able to harness non-White labour for that purpose. It is not true to contend that we do not want industries to be established in rural towns. We only want certain types of industries to be established there—those which are not labour-intensive. In other words, we want to keep the White platteland White. On the other hand the United Party wants any sort of industries to be established there, particularly labour-intensive industries, so that the White platteland can be overrun by non-White labour.

Hon. members on that side do not know where the Transkei-Ciskei complex is. Ostensibly, they do not know.

Tell us.

And yet the hon. member who has just sat down spoke about the west bank and the east bank of the Buffalo River, which is in the East London area. If he does not know where the complex is, how does he know of the difference which there is between the west bank and the east bank? I want to tell the hon. member that there are also many Bantu areas on the west bank of the Buffalo River. Perhaps he does not know that.

Is that a border area?

If it qualifies as a border area, it will be a border area.

I am asking whether it is a border area?

If it is on the borders of the Bantu area, it will be a border area and this also affects the question of industries established on the west bank. If the industries on the west bank are not labour-intensive, it will be silly to regard them as being border industries. Those industries could then just as well have been established in Bloemfontein or Heilbron. But, simply because an industry is on the west bank, even though it is not labour-intensive, hon. members opposite regard it as being a border industry. That is not in conformity with our policy. But if an industry is labour-intensive and it is within striking distance of a Bantu area, then, even though it be situated on the west bank, it will be a border industry.

How far is “striking distance”

A fool can ask a thousand questions which a wise man cannot answer! Let me make it clear that we know where the borders of the Transkei and the Ciskei are and the hon. member for Transkeian Territories (Mr. Hughes) who represents those areas, also knows where those borders are. The borders of the Transkei and those of the Ciskei have been determined time and again.

But where are the border areas?

Where is the border area of the Transkei?

The borders of the Transkei were laid down by statute two years ago in this House when we passed the Transkei Constitution Act. Umtata is a White town and it is not yet part of the Transkei.

Is it a border area?

Order!

Mr. Chairman, on a point of order. We are discussing an item which includes a rebate on railage in respect of goods in the Transkei-Ciskei complex. Which articles produced in the Transkei will receive the benefit of that rebate?

As I have already said, every case will be dealt with on its merits. For example, it is to no avail to assist a factory in Umtata which uses no non-White labour. Every case will then have to be dealt with on its merits in order to determine whether an industry qualifies as a border industry or not. The fact that an industry is situated in a border area will not be the only qualification; there is also the fact that it must be labour-intensive—in other words, that it must make use of non-White labour. Only then will such industry qualify for the purposes of this rebate. I think the matter ought to be clear now.

Let me come back now to the question of borders. It has been contended that the Cyril Lord factory will be the only one to qualify as far as East London is concerned. That may be the case at the moment because this undertaking is at present making use of Bantu labour on a large scale. The reason for this is not because it is situated on the east bank of the river but because it is labour intensive. Other industries may also qualify at a later stage because they make use of Bantu labour. The fact is that they will not qualify simply because they are situated in a border area. The deciding factor will be whether they make use of Bantu labour on a large scale—in other words, whether they are labour-intensive. There are, of course, other requirements as well which I cannot deal with at the moment because they are not relevant to this discussion.

Up to the present, three hon. members on the other side have participated in this debate. Firstly, there was the hon. member for Somerset-East (Mr. Vosloo). He is not here now. He contended that we on this side were opposed to the establishment of industries in rural areas, and that we were also opposed to the fact that railage rebates should be given to industries in the rural areas. He mentioned inter alia, industries in East London, and challenged the hon. member for East London (City) (Dr. Moolman) to tell the House whether he was in favour of the granting of this concession to industries in this area or not. The speech of the hon. member for Queenstown (Mr. Loots) followed the same pattern. He went so far as to say that we on this side of the House were opposed to the establishment in Queenstown of industries which have to be given these rebates. What happened then? The hon. member for Heilbron (Mr. Froneman) stood up and coined a brand new word. He said that only those industries which were labour-intensive would receive that assistance, would receive these rebates. If this is the case, gold mines should also qualify for these rebates because they are labour-intensive industries. What happens now to the arguments of the hon. members for Queenstown and Somerset-East? They spoke about industries on the White platteland but the hon. member for Heilbron told us that he did not want industries on the White platteland which were labour-intensive. He said that if they were established there, they would make the White platteland Black. What do hon. members opposite have to say now? The hon. the Minister stood up and indulged in vague generalities.

These Additional Estimates show this amount as being a nominal amount. We must remember that to-day is only the third of March and that the Main Estimates will be tabled on the 24th of March. This large sum of R179,335 has now to be allocated before the 24th of March and yet it is called a nominal amount. What is it? What is this absurdity which we are dealing with here this evening? What proportions does it assume? There is also an industrial area in my constituency which will not qualify for these rebates—at least, according to hon. members opposite. My constituency would not qualify for these rebates. What is going to be the position of the industries in my constituency as far as competition is concerned, in regard to the amount which we are being asked to vote? The industries in my constituency have the same market as these industries which are being supported by the hon. the Minister and which, according to the hon. member for Heilbron, are labour-intensive industries. What is going to be the influence of this artificial support for these industries on the part of the Government upon the industries in my constituency?

The hon. member for Heilbron has told us that we know exactly where the borders of the Transkei and the Ciskei are and that we know precisely where that industrial complex is. But at the same time the hon. member for Queenstown told us that Queenstown is also an industrial area which borders on the Ciskei and the Transkei. The hon. member wants to extend that area; he wants to make Queenstown and East London Black. One begins to wonder whom the hon. member for Queenstown recognizes as his Prime Minister—Dr. Verwoerd or Kaiser Matanzima. I think it is time that the hon. the Minister gave us a satisfactory explanation of this large sum of money which will have to be allocated within 22 or 23 days.

It is clear to me that the hon. member for Drakensberg (Mrs. S. M. van Niekerk) has no idea of the meaning of the words “border industry”. Let us take the item as it stands here: “Nominal provision for subsidies for the erection of industrial buildings and/or losses on housing schemes and other subsidies and losses”. It is clear that this amount is for the development of border areas. This item appeared on the Estimates for the first time last year and it was then called “nominal provision”. Although it is no longer nominal, the wording still remains the same as that which appeared on the Estimates last year. I am sure hon. members will be able to work this out for themselves. They must not be so stupid as to discuss this matter for an hour and a half. No one contends that the amount of R206,000 is still only a nominal amount. It is no longer nominal but the wording remains the same as it was last year.

The hon. member for Drakensberg asks what the border areas are and where they are. Does she not know that in terms of our policy a border area is an area within striking distance of a reserve; an area which will enable people living in a reserve to enter that area each day to work? If the area is too far away for them to enter it daily, they can return home every week-end. The hon. the Prime Minister has defined it. He has said that a border area is an area from which workers can return home every evening. If it is a little too far for this, perhaps 10 or 15 miles away, they may perhaps be able to go home twice a week in the evening; if it is 20 or 30 miles away from the reserve, they may be able to return home every week-end. How can the hon. member for Drakensberg be so stupid as to ask whether the gold mines can also be classified as border industries because they are labour-intensive? Can she tell me whether there is a gold mine within 30 miles of a Bantu reserve.

Oh, yes!

Perhaps the type of mine that may produce a grain of gold once a year. The large gold mines are in a complex which is away from the Bantu reserves. She ought to know that the gold mines do not fall within the definition of a border area.

Hon. members opposite are not concerned about industries which they want to have established throughout the platteland. That is not what they want. They are opposed to border industries; they are opposed to the whole idea that the Bantu should gradually be led back to their own reserves.

Since when?

They want the Bantu to stream to the cities in unlimited numbers and they want industries to be established in the cities. That is what they want. As far as I know, this House has already decided in regard to the border industry policy—that industries should be encouraged on the borders of Bantu reserves. We can assist those industries to a far greater extent financially than we can assist industries in other places because we want the Bantu to be domiciled in their reserves as far as possible and we want those Bantu who leave their reserves for a time to return to their reserves again. That is accepted policy. With all respect, Mr. Chairman, in discussing the question of industries throughout the whole of the platteland hon. members are trying to oppose a policy which has already been adopted by this House. I say that because we are dealing here with Additional Estimates which simply extend a principle already adopted and which simply require us to vote additional money for services which have already been approved of, I think, with all respect, that 90 per cent of the speeches made by hon. members opposite have been out of order.

It is very significant that this item is related so slightly to the item on the original Estimates that it required a footnote. If one looks at the original Estimates one finds that item E “Miscellaneous expenses” is worded exactly as this item is here but significantly the footnote does not appear in the original estimates. When one reads this footnote it is clear that the obvious reason for it is that there was doubt as to whether this was really an item which could be included in the revised Estimates. That is quite clear and that can be the only reason for the inclusion of a footnote such as the one we have here.

I come back to the point made by the hon. member for Queenstown (Mr. Loots) and the hon. member for Heilbron (Mr. Froneman). What they have said, Sir, is right off the line. The hon. member for Heilbron said the United Party wanted to make the towns throughout South Africa black. I ask him is it the policy of the Government that those towns which happen to be near the borders of the reserves will be made black.

They live next to those towns in the reserves.

The fact that they live next to those towns does not make the slightest difference. So far as Johannesburg is concerned, the Johannesburg Native area is just as far as from Johannesburg as is the Pretoria Native area from the north of Pretoria. How you can say you have integration in the one case and separation in the other case is completely beyond my understanding. The hon. member for Queenstown, as an authority on that area, was going to tell us exactly which areas fell within this note. I must object to the inaccurate information we have because even the footnote which explains this item says “Includes rebate on railage in respect of articles manufactured in the Transkei/Ciskei complex for consumption within the Republic”. There is some excuse for us being in doubt as to exactly what areas are covered because we find a totally different line taken by the hon. member for Queenstown as against that taken by the hon. member for Heilbron. I say we are entitled to have clarity on this. It is high time that the hon. the Minister entered this debate and told us which of the versions which came from that side of the House are the right ones and to which areas this item applies.

I just want to reply briefly to the hon. member for Germiston (District) (Mr. Tucker) and the hon. member for Drakensberg (Mrs. S. M. van Niekerk). The hon. member for Drakensberg said that I know that Queenstown is a border industry area. I want to say for the information of the hon. member for Drakensberg that this surely does not mean that we now fall under the prime minister of the Transkei, as she says is the position. I do not think that her argument was intended seriously and I do not think it is necessary for me to reply to it.

I stand up actually to reply to the hon. member for Durban (Point) (Mr. Raw). I just want to tell the hon. member for Durban (Point) what this policy has done for Queenstown. Last year the Fisher’s furniture factory burnt down. If it were not for the type of concession which we are dealing with here this evening, and others, Fisher’s furniture would have built their new factory on the Rand. I am telling you this this evening, Mr. Chairman, because I know what has happened. For the sake of this sort of concession and others, they are building their new factory at Queenstown and they are building it twice as large as it was before. I want to tell the hon. member further that we have Frontier Meat Products there. They are expanding enormously.

They have always been there.

Why are they expanding?

Why are they progressing economically? This would not be the case were it not for these concessions. We have a new industry there, Wormald’s Mills, which markets all its products which it markets outside that area by means of this 10 per cent rebate. Is this not an encouragement to any industry to become established there?

An HON. member on the other side asked what about Indwe? The hon. member must not ask: What about Indwe? He should ask the hon. members for Durban (Point) and East London (City) (Dr. Moolman) about Indwe because the one donated the ram and the other one presented it!

With respect, Mr. Chairman, this has as yet been the only contribution which those two hon. members have made this evening towards the border areas. I just want to tell the hon. member for Durban (Point) that he should study the East London complex. I spoke to the Mayor of East London this afternoon. Something is definitely happening in East London. There is an economic upsurge. I want to say that the policy and this sort of item which we are being asked to approve here this evening are the things which are making East London in the economic sphere. I want to tell you this evening, Mr. Chairman, that the people of the “Border” will not be grateful to hon. members opposite for the attitude which they have adopted during this discussion here this evening.

I want to ask the hon. the Minister just how far west the Ciskei/Transkei complex extends. Yesterday, in reply to a question by me, he told this House that the question of border industry status for the new pottery plant at East London was under consideration. He further told this House that the raw material for that plant was going to be drawn from Grahamstown. I take it that, if that industry is granted border industry status, it will enjoy this 10 per cent railage rebate as is shown here. You already have an existing pottery industry at Grahamstown. in the area mentioned by the hon. member for Somerset East (Mr. Vosloo)—in an area where there is also unemployment—and I want to ask the hon. the Minister whether it is his intention to discriminate between industries in the same area, simply because the industry in the East London area will be right bang on the border of the Bantustan, and the industry in Grahamstown is over 30 miles away and therefore does not presumably qualify for border industry status.

I want to deal with the remarks made by the hon. member for Heilbron. The hon. member indicated that the determining factor for border industry was the extent to which it was labour intensive.

I said that was one of the factors.

Yes. I want to ask the hon. the Minister whether an industry is granted border industry status on that ground. Suppose an industry satisfies all the Minister’s requirements and its labour intensive factor is satisfactory the industry is in due course granted border industry status and is granted the railway rebate. What happens if subsequently that industry introduces modern automation and reduces the labour factor from a ratio of. say, nine to one to one to one. i.e. one White to one non-White? Will that industry still enjoy the rebate or will it be withdrawn? If it is withdrawn is it the intention to ensure that industries which are granted rebate because they have a border status and because they have a satisfactory labour intensive figure remain inefficient and not modernize their plant?

Just before the Minister replies I would ask him whether he could give us some clarity in respect of which railway rebates will be granted to these decentralized border industries. Will the rebate be granted to a manufacturer, say, in a border area in regard to the raw material he requires to manufacture the finished product or will the rebate be granted in respect of the distribution of the finished product from the factory? I think it is important that we know that for this reason. The Cyril Lord factory is classified as a border industry manufacturing textiles. If they are going to get a rebate they must get a rebate on the distribution of the finished article flowing from the factory to the sale area which may be the Witwatersrand or the Cape for instance. But here in the Cape we have manufacturers of textiles who are selling their product to the border areas such as East London and Port Elizabeth. Will the manufacturer in the Cape be granted the same equitable rebate in respect of the finished product he sells in the same area in which the border factory is located as that border industry is granted? Because if that is not the case you are obviously going to create an unfair competitive area for the manufacturer located in an area distant from the consumption area in which the border factory may be located. I am sure the Minister will not tell us that he is going to give to a manufacturer in a border area a preferential sale rate in the area in which his industry is located. Because if the rebate is granted on the raw material consigned to the border industry for the manufacture of the finished product then obviously the end unit cost flowing from that factory is going to be cheaper than in the case of the manufacturer located in the Cape who also wants to sell his product within a Native area or the area in which the border industry is located. I think as far as assisting border industries is concerned and this question of rebates the hon. the Minister should give us a clear statement as to the basis on which rebates are to be granted to these border industries. It is important in the over-all interests of any manufacturer. He may feel that because of the granting of these rebates he will be faced by unfair competition on the part of manufacturers located in the border area. I am sure the Minister, as Minister of Economic Affairs, will not desire to create competitive conditions of this nature where the manufacturer in the border area will be in unfair competition, because of these cheaper railway rates, with the local manufacturer who sells in the same area. I hope the hon. the Minister will deal fully with this question because I think he appreciates it is one of considerable concern to industry as a whole.

Mr. Chairman, I think by this time it has become perfectly clear that the main difference between hon. members on the other side and this side of the House is one of principle. It is a difference of principle in this sense that we believe in border industries whereas hon. members on the other side do not. If we had come forward with these measures in respect of an area which did not also happen to be a border area, then hon. members might perhaps have agreed with us. Their main reason for opposing this item is not because this is a method of bringing about decentralization of industries but because this decentralization happens to apply also to a border area. I do not think that is fair. I do not think it is fair on the part of hon. members on the other side to adopt the attitude that this area must be punished because it happens to be a border area, in spite of all the disadvantages suffered by it as an industrial area.

I know that the hon. member for Durban (Point) (Mr. Raw) who is not here at the moment apologized for his absence, but the hon. member said, “We will support this if you extend the same benefits to all platteland towns.” But surely that cannot be done. If we are to give the same benefits to all platteland towns, then we must assume that all platteland towns have the same advantages and disadvantages in respect of the establishment of industries. Surely that is not the position. Certain towns and certain areas have certain advantages in establishing industries as well as certain disadvantages. The hon. member for Drakensberg (Mrs. S. M. van Niekerk) asked, “What about my constituency?” Sir, I say for the umpteenth time that that portion of Natal does not have the disadvantages that this area has in establishing industries. I am not referring now to railway rebates generally; I refer to railway rebates for this particular area. Let us forget for a moment that this is a border area. Let us think of it as an area that has certain disadvantages because its markets are far removed and because its raw materials are far removed; it has to pay two or three times as much for electricity as other places, and its coal is expensive. Let us think of it as an area in which there is a great deal of unemployment.

Places like Grahams-town.

I said nothing about Grahamstown.

Is there unemployment there?

Yes, definitely.

To what extent?

Representations have been made by the municipality in that connection.

We have often said that what we seek to do under this policy is to take the factory to the masses of workers. We are dealing here with an area therefore which has certain disadvantages, an area which has masses of workers who are unemployed and who should be provided with employment by means of industrial development. Industrialists cannot establish their industries in that area. Forget for a moment that it is a border area. Industrialists cannot establish their industries there because of the adverse factors which I mentioned here a moment ago.

If my hon. friend, the hon. member for East London (City) (Dr. Moolman), forgets for a moment that this is a border area, would he not be in favour of our giving these benefits to the area of East London so that East London may develop and have a greater share in the industrial development of our country? Or is he against it? Is he against the proposition that we should promote industrial development in East London by granting these rebates?

I must assume that the hon. member is against it because he refuses to accept it.

There is one legitimate question which hon. members put to me in this connection, and I want to reply to it in all fairness. They want to know how this is going to affect industries in other parts of the country. I want to tell hon. members that it is not our object to place industries which receive this rebate—it is a very small amount—in a more favourable competitive position as against other industries of the same kind. It is not our object to give them an advantage over their competitors so that they can compete with industries of the same kind in Cape Town or Johannesburg or Durban or Drakensberg. Our object is to help these industries to overcome the tremendous disadvantages that they have to contend with, so much so that existing industries face potential ruin and new industries simply cannot be established there. I can assure hon. members that our object is not to give them an advantage over their competitors; that is not the spirit in which this measure will be administered. Those industries will not be placed in a position of unfair competition with industries in other parts of the country. I trust that the House will accept that.

Hon. members, unfortunately, are obsessed with the idea that we want to establish factories only in that particular complex. Let me say here that an enormous industrial upsurge is taking place to-day in East London as a result of this border area policy. I think the hon. member for Queenstown (Mr. Loots) also mentioned this. The hon. member for East London (City) must know that that is so. That is the position as a result of this policy. The City Council of East London is grateful to this Government for what it has done in that area. At the present moment we are negotiating with quite a number of industries which are anxious to go to East London under this policy, and so far the hon. member has not said a single word to support this policy, nor has his Party done so.

No, I asked a question. Is the Minister going to tell us as far as the railway rebates are concerned that the wages scales are going to be precisely the same in these industries?

I will reply to the hon. member in the debate on the main Budget.

I have already given the assurance that we are not introducing these rebates in order to place those industries in a more favourable competitive position but so as to help them to overcome the disadvantages that they have to contend with in this area. Hon. members opposite are very concerned to-day about Cyril Lord and the whole of that complex. I just want to tell them that this issue arose as a result of the position of certain old established industries in King William’s Town and in East London. Let them listen carefully now. It was not because of new industries that we established there or which were attracted to that area because of the border area policy that this policy of railway rebates was formulated. The position is that old established industries in King William’s Town and East London faced the threat of having to close down or to shift to Cape Town or Johannesburg. I do not want to mention their names; I will give the names privately to hon. members but I do not think it would be right to mention their names here across the floor of the House. Some of these names are old household names.

On the west bank.

I do not know whether they are on the west bank; they are in East London in any event; they are old established industries which faced the threat of having to close down. They would have had to leave this area because they were unable to expand. In the first place it was in order to prevent those industries from leaving and, secondly in order to obviate the situation where new industries would be prevented from coming to this area, that we hit upon the idea of introducing these railway rebates. That was the motivation.

Why do you not give the same advantages to the industries of Potchefstroom?

Because the industries of Potchefstroom are not faced with difficulties in the shape of coal supplies, power supplies, transport facilities, marketing facilities and all the other problems that these areas have to contend with and because there are not thousands unemployed in Potchefstroom as there are in those areas. The position is entirely different. We would then, of course, have to give the same advantages to all towns, which would mean, of course, that we would then be giving no advantages to these areas which are badly handicapped at the present time.

In every type of decentralization in the world—let us take our type of decentralization—there is specific decentralization in specific areas. It is not just a question of a general, even distribution of industries over the whole country. Certain parts of a country are selected for certain reasons, and certain benefits are then given to those areas with a view to encouraging industrial expansion. That is the pattern throughout the world. Now that we are applying this pattern in this area, an area in which development has been retarded, we find that hon. members on the other side oppose us. Why? Because it happens to be a border area.

No, we are not opposing it.

Now suddenly we are not being opposed!

What about the Transkei?

I do not know; what about the Transkei?

I have indicated to the Minister that an important statement of policy has now been made to the effect that rebates will be granted to encourage industries to go to the Transkei. My question is whether the Government has changed its policy in connection with industries in the Transkei? What principles are going to be followed as far as rebates to industries in the Transkei are concerned?

That is entirely wrong. It is not the intention to apply this within the Transkei or within the Ciskei—in the Bantu areas. Here we have an area which we call the Ciskei/ Transkei complex; it is this White area with which we are concerned, not the non-White area.

One of my hon. friends opposite wants to know whether we now propose to use railway tariffs as a means of promoting decentralization. I can only say that there is nothing that prevents us from doing so. We even had a commission of enquiry which brought out a report as to how railway tariffs can be used for the decentralization of industries.

They were very careful.

Not all of them. What a commission recommends is not necessarily Government policy. We say that where we can use railway tariffs to achieve some economic object or other, whether it be the promotion of industries or whether it be decentralization, we will at all times feel justified in making use of railway tariffs for that purpose.

Who pays?

In this case the Central Government pays. There will also be other methods.

Is that the principle?

It need not be the only principle. We are now discussing this one specific case where we are making use of this one method as far as railway tariffs are concerned. If it becomes necessary to do so we can also use railway tariffs in other ways. I just want to reaffirm that the possibility is not excluded that railway tariffs may be used to promote industrial decentralization in one way or another. Sir, I do not want to go into ail the minor points which have been raised here. I think I have stated the general principles. We are prepared to assist all industries in that area which experiences difficulties in obtaining raw materials, in finding markets, etc. It need not be a border industry in the ordinary sense of the word. We are prepared to help any industry in that area which, because of distance, has difficulty in overcoming those handicaps.

On what principle will these railway rebates be granted?

I asked the hon. the Minister what such an industry would have to prove before it qualified for rebates.

The hon. member for Turffontein (Mr. Durrant) raised the question of the general principle, and the hon. member for Yeoville (Mr. S. J. M. Steyn) also puts a question to me. The hon. member for Turffontein wants to know whether rebates will also be granted in respect or raw materials. My reply is “No”, The rebate will only be granted in respect of finished products and not on raw materials. It is on finished products, of course, that the tariff is usually highest. That is why rebates are being granted on finished products.

The hon. member for Yeoville wants to know on what principle rebates will be granted. Sir, we have a committee which is called the Permanent Committee for the Establishment of Industries and Border Area Development, a committee consisting of officials of the departments concerned. This committee considers the applications of firms or factories which are established in this area. The committee establishes whether the particular factory is at a disadvantage as a result of its siting far away from the markets and far away from raw materials; it establishes whether the factory’s siting in that area is advantageous to it and whether its existence is affected by it, and it then determines whether and to what extent the factory is entitled to a rebate.

The hon. the Minister has referred to me repeatedly and has said that I am obviously opposed to railway rebates being granted to the border industries. But the hon. the Minister has again changed his attitude and has told us that it need not be border industries specifically. He does not want to give us a definition of the Ciskei/Transkei complex. He says that industries in the Eastern Cape which experience difficulties can apply for this rebate. All we want is clarity to enable us to dispose of this Vote. I think that the hon. the Minister knows that with the cooperation of the Industrial Development Corporation I travelled to various countries overseas and encouraged them to establish industries in the border areas. That shows how eager we are to have those industries here. I speak subject to correction when I say that the hon. the Minister told us just now that it need not be border industries specifically. I do not know whether the hon. member for Queenstown (Mr. Loots) considers his constituency to be a border area. He spoke of the same railway rebates to a factory in Queenstown. We will be grateful if the hon. the Minister will give us a clear explanation in this regard. The question which I put to the hon. the Minister when I addressed the Committee on a previous occasion was whether there will be discrimination between numbers of factories which we know in the Transkei/ Ciskei complex and the border industries to the west of the Buffalo River, and those which are still to be established and will be known as border industries. Will they receive the same concessions? These are things which we should like to know. The hon. the Minister is now extending it even more. He says that it need not be a border industry specifically.

Old factories.

The hon. the Minister mentioned old factories and factories to be established, if I remember correctly, and not border industries specifically. If a case is a deserving one, assistance will be given. We just want to know whether there is going to be any discrimination or whether every factory, whether it borders on the Transkei or not, will receive the same facilities.

Vote put and agreed to.

On Vote No. 33,—“Mines”, R501,

In dealing with M “Nominal provision for the State’s contingent liability for nuclear risks in terms of the Nuclear Installations” I notice that the amount is R1. It is quite clear that this is merely opening an account. I presume there is no data which can assist the Government in ascertaining what is likely to be paid but would the Minister tell us precisely what is anticipated; what is our liability likely to be? How in fact does the Government view the position with regard to this contingent liability? We all realize there is a possibility of damage and danger as a result of nuclear explosions and fall-outs and so forth. That is a real danger. It is something that is likely to affect the ordinary man. This is merely to open an account and it is being done in the Additional Estimates. The Government has not waited for the Main Estimates later in the year. There must therefore be a reason why the Government comes early, timeously, if I may put it that way, with such a Vote. I shall be grateful if the hon. the Minister would explain this to us.

The reason why this provision is being made is to enable us to deal with claims which might arise. We are only making provision for a nominal amount of R1. There may be no claims but we are merely making provision for the admissibility of such claims. Provision is being made because the plant at Pelindaba will soon be coming into operation. A start has been made on the experimental work necessary in this regard. The plant will be open in August and so we are making provision for claims now.

In so far as the people working with the installations are concerned is there any protection for them in respect of limitation of liability?

They are covered by insurance. There are insurance policies covering almost R5,000,000. This is in respect of buildings as well as public liability and personnel.

Each person?

No, not each person. There is a maximum of R10,000,000 and if that is exceeded then the Government is responsible.

Vote put and agreed to.

Business interrupted to report progress.

House Resumed:

Progress reported.