I move as an unopposed motion—

Agreed to.

I said last Wednesday that we found no fault with the hon. the Minister’s statement of his aims to keep the economy moving at a reasonable pace and to attempt to help prevent inflation, to curb rising prices and to keep the cost of living down. Of course, incidentally, where the hon. Minister has followed the advice of this side of the House, we naturally, approve of it— in matters such as relief to pensioners, the relaxation of the means test, dealing with the question of income-tax in respect of married working women and altering the system of provisional taxpayers’ payments, and the principle of keeping a brake on government expenditure, and realizing that the growth rate must unavoidably slow down. All these things have been urged by this side of the House, some of them for years, and now in principle, at any rate, if not in practice, to any marked degree, they are accepted by the hon. the Minister and therefore by that side of the House as well.

The only pity, of course, is that the hon. Minister has not taken our advice much oftener and much sooner. We also agree with him in the survey that he made of the economic position of the country and of the outline he gave of the problems which he states. After his survey, his conclusion was that the economic upswing which started three years ago continues unabated. And of course now he has got to abate it somewhat. And the hon. Minister sets out in his proposals which we are now considering to, in his own words, contain the growth of the total monetary demand, and he said that “fundamental remedies were required to penetrate to the root of the trouble”. The troubles he enumerated were threefold: First of all, cost inflation, which, he said, was due to bottlenecks, of which the principal one was labour shortage, and secondly, demand inflation, which was caused by monetary demand being met by easy credit, both for investment and consumption purposes, and thirdly, the decline in the foreign exchange reserves which, as he pointed out, during the last two months have fallen by some R44,000,000, as compared with R89,000,000 during the whole of last year, and an increase the previous year of R87,000,000. Those were the roots of the trouble for which the hon. the Minister set out to find fundamental remedies. Of course they are all intertwined. One cannot really discuss one individually without coming up against the other. This afternoon we have got to look to see to what extent these problems are being tackled through the proposals which are before us, to what extent precept and practice march together, and what fundamental remedies the hon. the Minister has prescribed.

The hon. the Minister seems to suffer from a slight lack of memory. He forgets that he is not a doctor this year, and that he is a tailor. But he set out to prescribe the fundamental remedies. Sir, these problems that he has got are, as I have said, in the first place, cost inflation, which I think, by common consent, is the most important one, and in that respect the most serious facet is the shortage in manpower. Now I want to know where in his Budget are there any serious positive steps taken for tackling the labour shortage in this country. I cannot find any reference to it at all. One may well ask: Does the enormous government spending programme help in any way to lessen the manpower shortage? I am inclined to think that on the contrary it tends to increase it. As far as the second problem is concerned, demand inflation, strong steps have already been taken by the Reserve Bank to deal with that, and again one asks how does this Budget help to reinforce the steps which have been taken by the Reserve Bank already. One has to remember, Sir, that the squeeze which the Reserve Bank has initiated, the results of which have not yet become fully apparent, is going to restrict the amount of money available in the money market, and one also has to observe from the hon. Minister’s proposals that the Government itself is going to make heavy demands on the money market during the coming year. The Minister will have to reconvert some R188,000,000 Loan Funds and in addition to that he hopes to raise R70,000,000 of new money for government loans.

It may well be that the restrictions which the Reserve Bank has placed on credit will have the effect that some people will find it very difficult to convert the whole of their government holdings during this year, and the Minister, I think, is quite right in saying that he may find difficulty in getting that amount. But nevertheless the Government itself is going to make heavy demands on the money market, which is by no means going to lessen demand inflation, which the hon. the Minister talks about. Because, Sir, if you take money from the private sector and transfer it to the public sector, it does not really alter the threat of inflation, because the money is spent all the same. In fact very often in the private sector it is spent more economically than it is in the public sector. So the Minister, I think, cannot say that those demands of the Government are going to reduce demand inflation. The third problem, the balance of payments problem, was not touched on at all by the hon. the Minister, except to say that it might become serious. He gave no indication of the prospects of the decline ceasing, and he gave no indication of any plans he might have for stopping that decline, or restoring the increase which was taking place at the end of 1963. Of course, there is the one obvious step of import control, at which I think the hon. Minister hinted.

We imported last year some R 1,589,000,000 worth of goods, over half of which consisted of machinery, plants, transport equipment, and that did not leave so much for consumer goods, and of course if you tighten up on import control, you increase the demand for locally made goods and you tend to increase their price, and in addition, which was most noticeable last year, the increase in prices which takes place is much larger in locally made goods than in imported goods. That was shown last year, and therefore any substantial increase in import control must have a further inflationary effect. Of course one positive step which comes to the eye would be to increase our exports in this balance of payments question, and it looks to-day, owing to climatic conditions, as if our fruit, our maize, our wool, our sugar may all show decreases in monetary value as far as export value this year is concerned. Therefore the only increase we can look for would be either in respect of base metals or minerals or manufactured goods. I wonder whether the hon. the Minister has had discussions with his colleague, the Minister of Economic Affairs, as to whether there was nothing by way of fiscal proposals that he could make to further stimulate and encourage the export of manufactured goods. If he did discuss it, is it possible that the hon. Minister of Economic Affairs had no suggestions to make? Or has the Minister of Finance found that his suggestions were quite impracticable? What happened?

Because the actual fact is that whilst the hon. the Minister is worried about the balance of payments position, he has completely ignored this question of exports in his Budget speech. The hon. the Minister said that one remedy was to encourage savings, and he gave us his slogan “save for prosperity”. One looks back about three years when his honourable colleague, the Minister of Economic Affairs, told us “spend for prosperity”. Now we have the Minister of Finance saying with equal emphasis “save for prosperity”. Is it any wonder, Sir, that the public is getting a little confused at this steady stream of contradictory slogans from the Government benches? May I ask whether all this was planned in advance? The hon. Minister has told us repeatedly that all these economic developments of the last few years had all been carefully planned.

Everything these days is going according to plan. Was it planned that three years ago the hon. Minister of Economic Affairs issued the clarion call to spend and that the hon. Minister of Finance now should come forward and issue the clarion call to save? Was that planned three years ago? Was it a carefully organized scheme to lead the country up and down the garden path, or what? But the Minister went further than giving this slogan. He pledged his Government to set a good example in saving, and he called on the provinces and local authorities to help him in a measure of austerity. Just let us look at the Government’s example to see what inspiration we can get to follow this call for saving for prosperity. The Government’s current expenditure according to the printed Estimates is for R 1,121,000,000 this year, an increase of R74,000,000 on the previous year, or an increase of 7 per cent. I remember how last year the hon. the Minister observed in this House that he thought a 2 per cent increase annually in Government expenditure could be regarded as normal. This year he says that 7 per cent is reasonable. What makes three-and-a-half times as much as normal reasonable is a matter which the hon. the Minister himself perhaps can explain.

As far as Loan Funds are concerned, the printed Estimates ask for R446,000,000, that is an increase of 12 per cent. As far as staff is concerned, last year there were 174,500 people in the Public Service and this year we are budgeting for 184,000 in the Public Service, an increase of some 10,000, an increase of 7,000 Whites as compared with an increase of 4,000 Whites in the previous year. Does that look like economizing? An increase of R74,000,000 in ordinary expenditure, an increase of 12 per cent in loan expenditure, an increase of 10,000 in the Public Service! Would you really call that an inspiring example to the country to save and economize in every possible direction? I won’t embarrass the hon. Minister by expecting an answer to that very simple question, because there can be only one answer that any person can give. But looking at these figures and looking at what the Minister has to say, and his complete failure to offer any fundamental remedies, or any positive constructive ideas as to how he is going to tackle these root problems, one is led to say that this Budget shows no sign whatsoever of a planned approach to the root troubles which are worrying the Minister, and they offer no fundamental remedies whatever, and they are purely defensive and negative in their guidance. I think that that becomes apparent when you come to look at the actual financial proposals of the hon. the Minister.

Current expenditure, according to the Estimates, will be R 1,121,000,000. To that has to be added the increased expenditure on pensions, and one has to make allowance for all the alterations contained in these proposals, minor alterations, and then you come to total current expenditure of R 1,139,000,000 for the current year.

As far as revenue is concerned, on the present basis of taxation, it is estimated that the revenue would be R 1,146,000,000. Again making allowances for the various proposals in the Budget, some up and some down, it works out that the net revenue which the hon. the Minister expects, on the basis of the present taxation, is R 1,149,000,000. That means that on the present basis of the expected revenue, and the present taxation, and current expenditure for which the Minister is asking authority, he expects to have a surplus in the coming year of R 14,000,000. Well. Mr. Speaker, one might think that after three years of this much vaunted prosperity, after a surplus of R120,000,000 in the previous year and R110,000,000 this year so far, and R14,000,000 already in the kitty for the coming year, one would have thought that the taxpayer, somewhat timidly perhaps, knowing this Government, might have hoped for some kind of relief. Because after all: Who has brought about this economic development? Who has brought about this expansion? Whom have we got to thank for this prosperity? Sir, we have to thank the workers of this country, not the Government, but the workers and the taxpayers of this country, who by their sweat and their keenness and initiative have brought about the fact that the finances of this country have done so well in the past three years, and one might have thought that these people, the whole of the people, could have expected some small token of recognition for their contribution to what the hon. the Minister of Finance regards as a highly satisfactory state of affairs, but not a bit of it, nothing of the sort. Far from it. As you will see, Mr. Speaker, if you look at the hon. Minister’s loan figures! The hon. Minister’s Loan Account figures are the most remarkable piece of bucket-scraping that I have ever seen in any Budget. He fixes the Government Departments’ requirements at R446,000,000, an increase of 12 per cent. Allowing for certain other minor increases, which he detailed in his speech, the amount is brought up to R457,000,000. On top of that he has to redeem in the course of the year R188,000,000 of maturing loans, and he expects to have a short-fall on this year’s Loan Account of some R 19,000,000. That brings the whole total of this Loan Account, for which he has got to provide in the present Estimates, to the colossal total of R665,000,000. It is more than half the total revenue of the country, considerably more than half, and it is far away the biggest amount that has ever appeared on the Estimates of the Republic, or the Union before it, in any one year.

How is the Minister going to get the money? The hon. the Minister proposes to obtain R481,000,000 by what one might call normal methods. That includes the conversions, to which I have referred, foreign loans, public debt commissioners, and so on. But after having done all that, the Minister has still got to raise R 183,000,000 more. How does he set about it? He takes the whole of this year’s surplus of R 110,000,000. He thinks that Government Departments may underspend by R 10,000,000. It is rather interesting to see that whereas the hon. the Minister agreed to a sum of R446,000,000 for the Government Departments (and presumably the Cabinet approved of it), they were printed at the beginning of the year, no sooner was the green light given by the hon. the Minister, when his colleague, the Minister of Public Works, stepped in and put his foot down and said: Certainly not! In the middle of February he announced that he had already as the building controller cut down State spending by R3,000,000, and a few days ago he told us that that figure has now reached R7,000,000.

Over how many years?

He is holding up projects, which have been agreed to. I do not say that the whole of the R7,000,000 will be underspent this year.

You have still got it wrong.

Well, the point is this that it is quite clear that the building controller, the hon. the Minister of Public Works, quite rightly, in view of the present position, is pruning the public sector of the Public Works Department. But one would have thought, Sir, seeing what is happening, that that would have been done before the Estimates were printed and before the Minister came along with this enormous sum. One wonders just how this planning business is going. It seems to me that there are so many people planning in the Cabinet that it is the old story: When father says “turn”, we all turn and we are all right. But they don’t seem to have learned that in the Cabinet. When father says “turn”, they all seem to turn in opposite directions.

Then the hon. the Minister takes R20,000,000 from the Tax Reserve Account. You will remember, Sir, that last year, out of the surplus, he tucked away a nest-egg for the taxpayer —he said that he was the trustee of the taxpayer. R20,000,000 were tucked away for the rainy day, and he now says that he is entitled to borrow that money from the taxpayer to include it in his Loan Estimates. It seems to me a bit of a euphemism that the Government is borrowing from the Government, and the only way that the Government can repay the taxpayer, whose trustee the Government is, is to tax the taxpayer to repay the R20,000,000 which the Government owes the taxpayer. It is a most complicated business, and in effect it simply means that the taxpayer can kiss his little next-egg of R20,000,000 good-bye, only a year after it has been put away. Of course, we did at the time call this R20,000,000 reserve account the election reserve account, and the events may prove that we were right.

Then the hon. the Minister imposes two fresh taxes, a savings levy of R 13,300,000, and here he has struck a new blow at the taxpayer by refusing to undertake to repay the loan at any particular date. I call that a blow below the belt. Previously savings levies have always been payable on due date and the taxpayer has always known when he might expect it, and I think they were negotiable at one time. But now this is an undated, indefinite loan at 5 per cent on companies and about one-third of the taxpayers, I think the hon. Minister said, which may or may not be paid back as the Minister feels inclined, and they are non-negotiable. Then he increases the companies’ tax to get another R16,000,000, and then he has this surplus of R14,000,000, to which I have already referred, and that gives him the amount he wants for the Loan Account. Mr. Speaker, you can see what this all means. It means that in order to finance his Loan Account, the hon. the Minister has not only taken R20,000,000 from the surplus of the year before last, but he has taken the whole of this year’s surplus of R110,000,000, and if you add the extra taxes he is putting on, he is taking R43,000,000 out of ordinary revenue this year which normally would be regarded as surplus for the coming year. So he is not taking one year’s surplus to finance his Loan Account, but he is taking the whole of this year, part of the previous year and a good slice of the next year as well. It is a most unheard of thing. That is why I say that he is scraping the bottom of the bucket to finance his Loan Account, and one can only say that the hon. the Minister has approached this Loan Account question in quite the wrong way. He told us that departments had put in an inflated demand for R540,000,000 and that he had managed to cut it down to R446,000,000. What would he have done if they had put in a demand for R700,000,000? Would he then have cut it down to R500,000,000 and said, “Look how well I have done”? Surely the hon. the Minister should have calculated what he could reasonably afford for Loan Account and he should then have told the Departments that so much is available and that they must just adjust their estimates to that amount. But apparently he did not do that, and as a result he has to find an amount which is out of all proportion, I think, to the reasonable ability of the country to find money at the present time and under the present circumstances. Now you see, that in spite of R 14,000,000 surplus to start with for the coming year, the taxpayer has got to find another R29,300,000 in order to bolster up the Loan Account on top of these surpluses that the Minister has already taken. What kind of long-term planning is this? What kind of planning at all? We hear so much about planning these days. We even have a Minister of Planning. I do not know how much he knows about planning or about this Budget. What kind of long-term planning is this? If this is planning at all, Sir, I am a true blue “Broederbonder”. It is not planning. It is fumbling. What is the hon. Minister going to do about financing his Loan Account next year? With all this multitude of planners, with a Minister of Planning, if they are doing any planning at all, surely they are planning for next near as well. How is he going to finance his Loan Account next year when he has already raided all the surpluses which were available this year? I am quite certain that it will be regarded as unpatriotic, almost as sabotage to ask such a simple question, and I think it is certain that I will get no reply, because I am sure that the hon. Minister has not got the faintest idea what is going to happen in respect of the Loan Account in 12 months’ time.

I will tell you next year if you are still here.

If neither of us are here, we will be able to compare notes outside the House.

Last, and I am afraid least in the eyes of the Government: How do the taxpayers benefit by this Budget? Do not forget that it is not only a question of the income-tax payers who pay direct taxes, but there are hundreds of millions of rand paid in indirect taxation and every person in the country has to contribute. How do they benefit by this Budget? The hon. the Minister had something to say about the agricultural industry. He told us that there were large sums available and he hoped and prayed that things would improve for them, and that the Government would assist with all the money that was required. But, Sir, far more than money is going to be required to help the agricultural industry to get on its feet again, and having got there, to stay there. This disaster which has overtaken such large sections of the agricultural industry has of course not been felt in the towns yet, but it will be. The cost of living is bound to be affected by the shortage of foodstuffs, and, of course, the Minister’s credit squeeze is certainly going to make things worse for the agricultural industry, because the commercial banks are having to clamp down on credit facilities. Therefore it is not sufficient for the Minister simply to express sympathy for the farmer and to say that vast sums of money will be made available to assist them. I think the House has the right to expect a very full and complete statement from the Government during the course of this debate as to how they will cope with this disaster which has overtaken agriculture and how they propose to set the industry on its feet again. [Interjection.] Is there anybody opposite who disagrees with me? The hon. member for Cradock always reminds me of the nursery rhyme, “Baa Baa, white sheep, you have not any wool”.

What about the average citizen? He is told that his wages will be held down and the cost of living is increasing. What is there in this Budget to help him to meet the difficult situation in which he finds himself? As far as the average citizen is concerned, this Budget might well be called the budget of the forgotten man. What about the pensioners? We have heard about the relaxation of the means test and the increased assets a pensioner may have, and that is all to the good, but what about the poorest type of pensioner, the many hundreds and thousands of them, who have nothing but the old age pension to live on and who have no assets? This Budget offers them an extra R1 a month. Can one feel that that is very generous, having regard to the present state of the country’s affairs?

You are talking utter tripe.

I have no doubt that the hon. member for Vereeniging (Mr. B. Coetzee) will say it is too generous We all remember how he opposed any relaxation at all to the old-age pensioner last year. In view of all these facts, I should like to move the following amendment—

1. (a) indicate specifically what practical steps it intends taking to rescue the agricultural industry from its present desperate plight and to re-establish it on a sound basis for the future;
2. (b) ensure that the average citizen is able to meet the increased cost of living and to obtain his rightful share of the benefits of an expanding economy;
3. (c) give more adequate assistance to the neediest class of pensioners; and
4. (d) take more active steps generally to ensure the continued growth of the economy of the Republic as an undivided and integral whole.”

The Minister this year called himself a tailor. I think of all his disguises this is probably the most inappropriate of the lot. The old proverb says you cut your cloth according to your pocket, but the Minister forgets that it is the customer who decides what he wants to pay for his suit, and in this case the Minister as the tailor tries with one hand to make the suit, whether the customer likes it or not, whilst with the other hand he drags the money out of the customer’s pocket. It is a wonderful racket and I hope it will not be followed by the tailoring profession as a whole. Sir, this Budget simply confirms what we have believed for a very long time. The sooner the customer changes his tailor, the better it will be for him and for the country as a whole.

Mr. Speaker, before I come to the hon. member for Constantia (Mr. Waterson), I want to congratulate the hon. the Minister very heartily on the White Paper which he gave us together with the Estimates. This document contains very valuable information which is presented in an excellent way. If the hon. member for Constantia had only devoted a little more study to this document, he would have spoken less nonsense here this afternoon.

Sir, we are dealing here with a Budget which testifies to realism and to the Government’s policy throughout the years to provide the necessary flexibility in the Budget to meet the circumstances of the time. The hon. member concluded his speech by talking about a suit of clothes. I want to tell the Minister that I think this Budget is a fine tailor-made suit for South Africa. But a suit tailored by the hon. member for Constantia would be more or less like a suit which is made for him but worn by the hon. member for Point (Mr. Raw). Judging by what he said here this afternoon, judging by the sort of Budget he would have introduced if he had had the fortune to be Minister of Finance, I would say that his Budget would have been like a tailor-made suit, the trousers of which one has to wear over one’s shoulders and the jacket of which one has to wear over one’s legs, a suit of clothes with zips, whereas we know that our farmers still believe in wearing buttons because a zip is an extremely dangerous thing to wear. Sir, I am afraid the hon. member has not been successful here to-day, and do you know why? He did not have enough to mourn over. As far as finance is concerned, he had nothing to mourn over and that is why he was unable to talk about finance. There are certain things, however, over which he might well have mourned, but about those things he had to remain silent. I think the hon. member had a better opportunity here to-day for mourning than he has ever had before in the past, but he allowed the opportunity to slip, and if one once allows an opportunity to slip that opportunity never presents itself again. I want to ask the hon. member whether he has ever heard of Pretoria (Rissik)? Has he ever heard of Pietermaritzburg (North), of Umhlatuzana and of Umlazi and Zululand? Has he ever heard of Jeppes and Port Elizabeth (Central), and of Ladysmith in Natal, alias Drakensberg? Has he ever heard of Germiston (District) and Springs and Cape Town (Gardens)?

And Queenstown.

As far as Queenstown is concerned, we already have a Nationalist representative in this House. I am only mentioning the constituencies which are not yet represented in this House by Nationalists. I wonder, Sir, whether one should not call upon the members representing the constituencies I have mentioned to stand up so that we can see which members are serving their compulsory notice? After all, here we have a matter in regard to which the hon. member did have cause for complaint and in regard to which he could have treated us to a jeremiad which would have put the late Jeremiah himself to shame.

But let us look for a moment at the hon. member’s speech and his amendment. In the last point which he makes in his amendment he says, “generally to take more active steps to ensure the continued growth of the economy of the Republic as an undivided and integral whole”. But according to the hon. member we have never had any growth in our economy! How are we to interpret his new attitude? After all, his attitude is that there can be no growth under this Government. This point which the hon. member makes in his amendment and in his speech entirely refutes and condemns everything that he has said in this House in the past. He says that the Minister should have planned better, but, Sir, there has been good planning by the Minister and by the whole of the Government and that is why we are having this wave of prosperity to-day. The hon. member has never believed before that there is economic growth taking place in this country, but to-day he talks about “ensuring the continued growth”. In other words, he now admits that there is growth. In the past the hon. member has always wanted us to do the opposite; he has always prophesied depressions and retrogression. But according to what he said here today, he is now saying in effect, “Do not take any notice of what I say because what I say is diametrically opposed to what actually happens”. Sir, I want to prove that statement. A short while ago, in June, 1961, the hon. member moved an amendment in this House on the Appropriation Bill, an amendment in which he said, “the House declines to pass the second reading because the Government (a) is responsible for the alarming decline in the country’s economy and (b) is making it impossible to restore the expansion and rate of advance”. He went on to say in the course of the same speech, “There is talk of a possible depreciation of our currency, of devaluation”. He said that the Minister denied it, of course, but that when one looked at denials made by the Minister in the past, “the Minister will permit us to say that we doubt what value can be attached to his statement”. In March 1962 he again made certain prophecies; he said, “I see nothing to encourage economic progress and to restore confidence. On the other hand I do see things which are checking economic development”. He did not use the word “delay”; he used the word “check”. He said that the Government’s statement that we were making the greatest possible headway within the framework of general Government policy was a contradiction in terms; that experience over the past five years had proved that no general progress was either probable or even possible within the framework of general Government policy. Well, what does that mean? It means that the hon. member was asking the Government not to plan for prosperity but to plan for adversity and retrogression, for depression; not to bring in immigrants because we had so much work here for them but to plan for immigration because we had unemployment and economic chaos in this country. To-day the hon. member finds that he has to fulfill a new role, but he has had very little success in playing this new role.

The hon. member for Constantia also made a further point in his amendment. In paragraph (c) he talks about giving “more adequate assistance to the neediest class of pensioners”. Sir, this Budget gives where it can give; it gives where the need is greatest; it checks the threatening inflation, and therein lies the value of this Budget. In the first place the hon. member says that too little is being given to working wives; he says that the concession given to them is too small. I do not know what the figure is, but I think there are many thousands of married couples who are going to derive great benefit from this Budget. The hon. member said in his statement to the Press that this concession was disappointing and would not adequately meet the grievance. What sort of concession did he want? Does he think that the ceiling of R8,000 is too low? If I had to put forward any criticism in this regard it would be that the Minister made the ceiling too high. I think a ceiling of R5,000 or R6,000 would be high enough for this concession because people with an income of R8,000 fall well and truly in the old super-tax bracket.

The hon. member then dealt with old-age and other civil and military pensions. In this regard the Government is doing a very fine thing; I think there are hundreds of thousands of people who will benefit by this Budget. Not only does the Budget benefit those who are already drawing pensions in that they are all being given something additional, but the people about whom we complained most in the past are in the first place those people who saved a little themselves, who own their own homes, and who therefore failed to qualify for a pension. These people are now being given a little extra; they are being given the opportunity to draw a more reasonable pension even if they own their own home. As a result of the abolition of the bonus system and its replacement by a new means test, there are many thousands of people, who could not previously qualify for a pension, who will now be able to draw a pension. I notice that the hon. member boasts about this concession. He says that this concession is really the result of pressure exerted by them. In the earlier part of his speech he said that there were quite a few good things in this Budget but that they were all giving effect to United Party policy. One would swear, Sir, that the hon. member introduced this Budget! He then proceeded to put forward a number of complaints in which there was very little substance. I want to say to the Minister that I think these concessions are going to cost more than the figure estimated by him. Sir, the hon. member said in a statement to the Press: “The concessions are, of course, welcome, but long overdue and only go part of the way to meet the plea made by the United Party over the years”. The United Party, Sir, are the last people who should claim any credit for themselves as far as this matter is concerned. We still recall what happened prior to 1948 when they were in power.

At that time the pound was still worth a pound.

Yes, but in those days the ceiling of the means test was £48 or R96. Immediately after we came into power it was raised to R180; it was practically doubled; and the maximum pension that a person could get at that time was £6 per month. To-day that same person can get R528 in the shape of a pension together with income derived from his own assets, a tremendous difference. But that is not the point. The point is that every year, from the end of the war until 1948, the National Party asked for some concession to be made to pensioners, but the then United Party Government gave these people nothing. When the National Party came into power, Mr. Havenga made certain concessions to these people in his very first Budget. He immediately raised the means test ceiling from £48 to £90, or R180. I still recall very clearly that in that same year one United Party leader after another stood up here and said to the Government, “Look what a large percentage of the national income you are spending in this Budget; you are wasting money.” Sir, the party which is responsible for these increases is none other than the National Party Government. The concession which the Minister has made here has been advocated here from year to year by hon. members on this side of the House. We put forward the plea that the bonus should be abolished and incorporated with the pension so that people who just failed to qualify for the pension could also qualify. This plea has been put forward here by the hon. members for Paarl (Mr. W. C. Malan) and Kimberley (South) (Dr. W. L. D. M. Venter) as well as other members, and I myself made the same plea from time to time. When the United Party noticed that we were doing this, they started trying to create the impression that this was their idea and they also started putting forward this plea. I personally have often raised this matter here, and in this connection I just want to quote from one of my speeches. This is what I said in March 1962 (Col. 3163)—

That is the attitude which the National Party has adopted throughout the years with regard to this matter, as stated here by various hon. members on this side. For the United Party to come along now and try to claim the credit for this is just so much nonsense.

Then I come to point (b) in the hon. member’s amendment in which he asks that the Government should do something “to enable the average citizen to meet the increased cost of living and obtain his rightful share of the benefits of the economic expansion”. He did not say it in so many words, but he did say by implication that there should be a general increase in wages, and I want to ask the hon. member whether the United Party advocates a general increase in wages, accompanied by inflation which will be the inevitable outcome of such a step? I think the hon. member should tell us. He talked about the surplus of R110,000,000 and said that we were not using it correctly. He urged that we should allow a greater portion of this money to find its way into the pockets of the taxpayers. Is it not inflation that he is advocating? Does he want this country to land in the morass of inflation, with the result that our main stabilizing industry, the gold-mining industry, will eventually have to disappear? No, I think it is very irresponsible to adopt that sort of attitude. The reason for the surplus that we have to-day is the fact that our economic growth over the past year has been much greater than even the greatest optimist could have anticipated. The Government did not anticipate that our rate of growth would continue at the same level as during the previous year. Sir, this is the fourth year during which this high rate of growth has been maintained. I am not aware of any other country in the world which has been enjoying boom conditions over such a long period. In every other country one finds that bottlenecks arise within the space of a year or two and then they first call a halt; in some cases their development comes to a standstill and they first reorganize their forces before they take the next forward step—and that is what we expected in this country. I say that what has happened here is an economic miracle and it is due to the brilliant leadership that we have had from members of the Cabinet that we have been able to maintain this position up to the present moment.

I want to say a word or two now in connection with the question of wages about which the United Party had so much to say. Sir, when I arrived in the Transvaal just before the election I found that political capital was being made out of the fact that the hon. the Prime Minister had allegedly stated that wages were to be frozen and that he had made that statement here in Parliament. That, of course, is a gross untruth. The United Party thought that they were dealing with a lot of pocket patriots in South Africa; they wanted to buy the vote of the railway officials and the Public Service officials. This is the eighth election that we have had since we have come into power and at every election the United Party have made promises left and right; at every election, however, the voters have shown them that they regard these promises as an insult because they are not pocket patriots. As far as this cry of higher wages to meet the higher cost of living is concerned, have the public servants ever asked them to ask for higher wages? No, they have not. This is something which the United Party is simply inventing. They think that whenever there is an election, all they have to do in order to catch votes is to make a lot of promises of monetary benefits, but on every occasion the voters have flung these promises back into their teeth, and the more promises they make the worse they will fare. The officials do not want this sort of thing. They look with contempt upon people who say to them, “You should vote for us in your own financial interests.”

I want to put this question to them: Do they want our wage structure to be linked up with the cost of living in this country? Do hon. members opposite feel that that is what we should do? My reply is: “No”, because in that case the public servants would be much worse off than they are to-day, and that also applies to the railwaymen. As the hon. member for Bloemfontein (East) (Mr. van Rensburg) pointed out to us in the course of the Railway Budget debate, wages in the Railway Service since we have come into power have been increased by 123 per cent whereas the cost of living has increased by 65 per cent; in the Public Service wages have been increased by approximately 116 per cent while the cost of living has risen by 65 per cent. In other words, a public servant who received R1,000 in 1948, should have been receiving R 1,650 to-day if his salary had to be increased to keep pace with the rise in the cost of living, but in actual fact he is getting R2,150. If the increase in wages must always keep pace with the rise in the cost of living, must the official’s wages be increased when the cost of living rises and must his wages be reduced when the cost of living drops? If that is the proposition that they advance, then it is only fair to say that these people have been overpaid R500 and that they should refund this amount. That is the only conclusion that one can draw from the United Party’s policy because they obviously want to link up wages with the cost of living, and if that is done then no provision is made for a growth in the real income of persons. That is an extremely unhealthy attitude to adopt.

The hon. member also came along with the cry, “Save for prosperity”, or rather he said that the Minister had suggested that people should “Save for prosperity”.

The Minister said so.

Yes. that is what the hon. the Minister said. The hon. member comes here and says that the Government is not setting an example; he says that provision is being made for an enormous increase in Government expenditure in the year which lies ahead of us. I want to ask the hon. member whether he has any objection to it. He voiced a certain amount of criticism but he did not say very clearly whether he was against it. Mr. Speaker, here I have the Loan Account and I want to ask the hon. member which items in the Loan Account he wants to prune. We have already approved of the Railway Budget here and we have voted funds to make it possible for the Railways to develop on a large scale in the years which lie ahead so that the Railways will always be in a position to cope with the growing volume of traffic of the country. We voted R37,000,000 more than last year for the Railways. We are now being asked to vote R22,500,000 more than last year for housing. Is the hon. member opposed to the building of this extra housing, particularly now that the Minister of Community Development has control over buildings and will be able to apply the brake to some extent as far as the construction of buildings other than dwellings is concerned? Has he any objection to our voting an additional R22,500,000 for housing? Sir, we are constantly told by the Opposition that there is not enough housing in this country. Why are they complaining then? Take Lands and Water Affairs, R 11,000,000. This increased amount is being asked for after the Government has decided to proceed a little more slowly with the development of the Orange River scheme, a decision which I rather regret because I think the sooner we complete that scheme the better it will be for the country as a whole. As I said, we are being asked to vote R 11,000,000 more than last year for Lands and Water Affairs. Do the Opposition want to prune that item? In the case of Commerce and Industries we find that there is an increase of R9,000,000. Do they want to prune that item? Have they any objection to our erecting an aircraft factory for which we are being asked to vote R5,000,000? Are they opposed to development in the border areas, for which we are being asked to vote R6,750,000? Have they any objection to developmental schemes in South West Africa at a cost of R4,250,000? These developmental projects will be undertaken by the Industrial Development Corporation and the House is being asked to vote this capital for the I.D.C., the establishment of which in my opinion is one of the best things ever done in this country, even though, as far as I remember, it was established by the United Party Government. After all, they cannot always be wrong; they must be right occasionally!

As far as Trust Lands are concerned, the increase is R 10,000,000. We are constantly told by the United Party that we should develop the Bantu areas more rapidly. Have they any objection to our asking for more money so as to be able to develop the Bantu areas more rapidly? Mr. Speaker, as I have just indicated, we find that there is an increase of R90,000,000 in five or six departments only. In the case of all the other Departments together there is an increase of only RIO,000,000. Is the United Party opposed to any one of these developments?

Let us look for a moment at the R74,000,000 of the Revenue Account. We find that there is an. increase of R20,000,000 in salaries. It is inevitable that the salary bill will increase. Does the United Party want to prune this item? They said a moment ago that higher salaries should be given to the officials; do they now want the salaries of the officials to be reduced? Take the interest on our public debt. Here we are dealing with an item in regard to which there can obviously be no argument; the increase in this case is R 14,000,000. The subsidies to the Provinces, which are fixed according to a formula and in regard to which there can be no argument, are being increased by R7,880,000. These three items alone, which nobody can do anything about, account for R42,000,000 out of the R74,000,000. We are constantly told by the Opposition that we need more technicians and that we should provide more facilities for technical and vocational education. What is the position as far as education is concerned? In the Education Vote we find that there is an increase of R3,787,000. What is the position as far as the Postal Vote is concerned? The Post Office is a business undertaking, and as its work increases its expenditure must necessarily increase. As far as the Postal Vote is concerned we find that there is an increase of R4,765,000. Mr. Speaker, I seem to remember that one of the United Party members said the other day that the Government ought to pay increased subsidies on food so as to keep down the cost of living. What do we find in these Estimates? We are being asked to vote an additional sum of R3,240,000 for the stabilization of the price of bread. As far as fertilizer is concerned there is an increase of R 1,700,000. The Bantu Trust Fund is being given R4,500,000. This is the only item to which the Opposition can object, but if they do object they will be doing so against their declared policy that we should develop the Bantu areas as rapidly as possible and that we should purchase the remaining land for the Bantu as soon as possible Sir, there are 50 different Departments in this country. [Time limit.]

The hon. member who has just sat down started by criticizing my colleague, the hon. member for Constantia (Mr. Waterson) for not talking sufficiently about the Budget. Sir, I think he must concede that he did not do so well himself in that regard. He tried to indicate that the Budget was a realistic one and that the planning was good, but he gave no positive instances of good planning. To me he gave the appearance of the financial expert on the Government Benches who happened to be wearing one of these ill-cut coats tailored by the hon. the Minister, and he was certainly not feeling very happy about it, which rather indicates, of course, that he was not very happy about the Budget generally. The hon. member proceeded to select certain items in the Budget and to praise them, items which no one has as yet criticized and some of which are quite unlikely to be criticized. He tried to justify the very limited increase to pensioners by quoting certain comparative figures. But he forgot, of course, to mention that over the past 17 years there has been a considerable depreciation in the value of money and therefore a very great drop in the real value of the pension benefits now payable. Sir, I shall deal with some of the other remarks of the hon. the Minister during the course of my speech. I shall certainly touch on his comments in regard to what I call the Government’s failure to curb inflation before it could get out of hand and also its failure to recognize the needs of the gold-mining industry.

Mr. Speaker, as reported in the Press, the Stock Exchange seems to have regarded the Minister’s Budget as something of an anticlimax. It is not for me to go into their reasoning but I can certainly understand their point of view because what the Minister has very successfully done is that he has left a number of question marks scattered around his Budget and he has chosen to obscure as much as he possibly could avoid defining. Accordingly, as a declaration of faith by the Government in the continued progress of prosperity the Budget is hardly an inspiring document, and as a summary of the Government’s monetary and fiscal programme for the coming year it is a document which provides little comfort for anyone. The hon. member for Constantia has expounded on that aspect of the matter. Listening to his argument in that regard it seemed to me that in the circumstances it was perhaps fitting that the hon. the Minister reverted in character this year to his own drab self as the harassed fiscus, pointing the moral to others “to save for prosperity” but joyfully ignoring it for himself and his Government. But, Sir, I agree with the hon. the Minister that this is no time for his usual Budget-day game of charades. That way, as he himself rather indicated, could be the way to financial irresponsibility. I say that quite seriously because unfortunately there is evidence in this Budget of economic irresponsibility on the part of the Government. What I find particularly disturbing in that regard is that the Budget presents to the country and the financial world at large a picture of economic imbalance in many directions. Let me briefly touch on two such instances. It is, for example, quite fair to say that the Minister’s proposed taxation relief and his money concessions are meagre to a degree in respect of the lower income-groups, i.e., for the so-called man in the street who has a very limited amount to spend and virtually nothing to save. The hon. member for Constantia rightly pointed out that these are the forgotten men in the Budget, because you see, Sir, the actual cash value which they are going to get out of this Budget may well be likened to the crumb that has fallen from the table of the Minister’s surplus banquet spread—and what a spread it has been!—estimated by the Minister himself to run into R 110,000,000. It is likely, however, to run into many millions more. I say that because by the end of February the Minister’s intake on Revenue Account was already R 100,000,000 ahead of his estimates, and as at the same date the Revenue Account expenditure had fallen by something like R90,000,000 below his estimates. But in spite of this Budget of plenty, the Minister has granted concessions and relief to the forgotten man to a markedly small degree. He justifies this tight-rein hold that he keeps in granting anything more than a crumb of relief to the lower income group on the score that he does not want to add to the hardships that they are already feeling as the result of the presently steeply rising costs of living. In other words, more Budget relief for the poor, so the argument goes, would produce more inflation and thus increase the cost of living. Sir, what a demonstration of imbalance economic thinking! Some more generous concessions to help the needy, so the argument goes, will lead to inflation, but adding that same amount of money to the year-end revenue surplus and using it to bolster up Government spending will not. What a strange sort of logic! I think it amounts to this: Let the needy go hang and leave the spending to the Government because they alone know best.

Sir, I move on to another sphere in the economic scene, namely gold-mining. Gold-mining, fortunately, still remains the kingpin in the mechanism of the country’s economy, but according to the hon. the Minister’s own statement the gold-mining industry is now vulnerable on two fronts. Firstly, as the Minister says, the mining industry has commenced the downward curve in gold output and, secondly, as he indicated, inflation has become a crippling factor and is adding to the cost of production. We all know, of course, that gold stays at a fixed price. But in spite of this obvious dilemma, something which is quite beyond the control of the industry itself, the Minister and his Government refuse to heed the many appeals which have been made to them for a downward adjustment of the tax levy on gold mines. That, Sir, is a form of tax relief which in practice cannot add to the danger of inflation at this time. It is easy to understand why that is so, because the credit squeeze and the higher borrowing rates recently imposed by the Government make self-finance of capital outlay by the gold-mining industry more essential now than ever before. In practice therefore it means that there will be a ploughing back of a larger proportion of profits than before. It is quite true that certain modest concessions were made last year and the year before and that some of these are to continue and may even be stepped up during the coming year but, Sir, I think the economic imbalance of the Government’s outlook in regard to the gold-mining industry and taxation and the degree of its faulty outlook in that regard, is rather well expressed in an extract from a report which was given towards the end of 1964 to the shareholders of one of the major gold-mining companies. The reference in that report is to the concessions made last year and the statement reads as follows—

Sir, I think that is a very fair statement of what I call the economic imbalance of the Government’s thinking. Instead of taking a bold step of that kind the Minister chooses to conjure up slogans.

Are the gold mines to pay no tax at all?

Sir, if the hon. member wishes to disclose his ignorance about this matter he is succeeding very well. The chairman of a very important gold-mining company would not publish a statement of that kind without justification. I hope the hon. the Minister at any rate is going to be somewhat wiser than the hon. member who has just made this interjection. Sir, instead of taking that bold action the Minister chooses to conjure up slogans. The hon. member for Constantia has mentioned the first of these slogans namely: “Spend to start prosperity.” Well, that slogan flopped and it flopped very soon.

It did not flop; it started the prosperity.

It has flopped. Perhaps the hon. member for Vereeniging (Mr. B. Coetzee) will answer this question: Why should the consumer be expected to spend for prosperity when prices are rising? That is precisely what has been happening, and that is a suggestion which is entirely beyond my comprehension. I am afraid the hon. member for Vereeniging has lost interest now because it is also beyond his comprehension. As I say, in spite of what the hon. member for Vereeniging says, this slogan flopped because the consumers themselves saw that it was also beyond their comprehension. There has now been a change in emphasis and the new slogan is: “Save to maintain prosperity.” But, Sir, that is equally sure to flop. I say that firstly because, as the hon. member for Constantia has already indicated, the Government itself shows no intention of following the precept themselves and, secondly, commenting on Friday last week, on 26 March on the combined effect of (1) the Budget, (2) the credit squeeze, and (3) the fixing of borrowing rates, the head of a motor manufacturing concern had this to say—

This head of an important manufacturing concern sees in these measures the forging of a curb on the development of the motor industry and he very wisely therefore suggests a third slogan which goes like this: “Produce to ensure prosperity.” That certainly contains some sort of sense which I at least can understand and possibly the interjectors on the other side of the House as well.

I come next to the Minister’s proposals on the Loan Account for the coming year. As 1 said just now, the hon. member for Pretoria (Central) (Mr. van den Heever) selects certain items, praises them and then having set up the skittles he expects us to knock them down. But that is not the purpose of an opposition. The purpose of an opposition at this stage of debate is not to deal with individual items. We are not here to plan and to say how the estimates should be compiled. We are here to criticize the Budget in all its aspects and not in single items. Sir, it is quite obvious, looking at the figures which the Minister presented to us, that he faces the formidable task of finding the substantial sum of R665,000,000 for the coming year, which exceeds by something like R150,000,000 the amount which he needed during the year which is now drawing to a close. In that regard I am reminded that last year when I ventured to suggest to the hon. the Minister that Government borrowing on Loan Account might be difficult and might come at a time when capital investment in the private sector of economy was approaching its zenith, the hon. the Minister then simply brushed aside the matter and said that he saw no difficulties at all. But significantly enough he is now closing his financial year with a deficit of nearly R20,000,000. I know that an equivalent amount was readily available in the Exchequer Account, but drawing on that source is a questionable expedient. It certainly means that all the Minister is doing is to pass on the buck to next year and that in the meanwhile the taxpayers’ money is being used for a purpose not intended. Sir, I mention that incident because the Minister is now likely to face an even more acute financial problem on the capital market during the coming year, and I need do no more than quote his own words to make the point; this is what he said—

I think the hon. the Minister makes the point far better than I can and I leave it there.

Sir, I do not have the time to deal with detailed capital spending nor have I enough time to examine fully how the Minister intends to raise the money he needs on Loan Account, namely: (a) R457, 000,000 new money to pay for his capital commitments, (b) R188,000,000 to repay expiring loans and (c) R20,000,000 to meet the shortfall in the account at the start of the year. But, in order to avoid detail as much as possible I shall summarize the sources from which the money is to come under four main headings, and I shall give under each (a) the amount which the Minister now proposes to raise compared with (b) what he proposed last year.

The result is as follows: (1) From taxpayers R153,000,000 compared with R16,000,000; (2) from private investors, R237,000,000 compared with R 188,000,000; (3) from external borrowing R310,000,000 compared with R51,000,000 and (4) from funds in the hands of the Government—and that includes surrenders and moneys under the control of the Public Debt Commissioners—R244,000,000 compared with R245,000,000. The burden placed on the taxpayers’ shoulders in this regard is excessively high. The difference is R137,000,000 more in a single year, but it will be still higher if the R20,000,000 in the tax reserve account is to be added to this head as well. Private investors are being asked to increase their stock commitments by just under R50,000,000 and external investments are expected to drop by R20,000,000. Sir, as the hon. member for Constantia has already indicated, what all this shift in the money supply to pay for capital spending augurs for the future is perhaps best left unsaid at this time.

I myself thought last year that the hon. the Minister was being very hasty when he sought powers to borrow internally and then to lend abroad. I refer to Section 18 of the Finance Act, No. 76 of 1964. Events have now proved, of course, that he was being hasty and even impetuous. But to revert to the present, I say moreover that this change in the financing programme will do nothing to stem the march of inflation. No part of the excess tax revenues, the new loan levy, or the increased borrowing is to be immobilized from current use. On the contrary, as has already been pointed out, even the R20,000,000 in the newly created tax reserve account is now to be mobilized; it goes into the Loan Account to bolster up Government spending. I say therefore that this Budget is not an inspiring one. Business is likely to see in it a crisis of confidence, a crisis of confidence in the ability of the Minister and his Government to stop the march of inflation without stopping the march of prosperity at the same time.

Sir, in the few moments left to me I would like to deal with just one other matter and to ask the hon. the Minister to give the House some sort of clarity as to what the costs are to be of the Government’s policy for the development of industries in the border areas. In May 1964 the Board of Trade and Industries indicated in its report that the Government had decided to appropriate some R45,000,000 to the I.D.C. over the next ten years. That is apparently still the Government’s intention. By the end of March of this year R15,500,000 had been voted to the I.D.C. under Loan Vote J, but by the end of February 1965 the commitments and payments by the I.D.C. had already amounted to R22,500,000. That, of course, means that half of the ten year programme has already been committed.

There is also this additional aspect. Moneys are being provided for the same project under Vote B to the Department of Labour, to the Department of Community Development under Vote K and to the Department of Planning under Vote S. A certain amount of expenditure is also being incurred under Revenue Funds. I have not got the details with me in regard to the current financial year but all in all it amounts to a substantial amount. Not only is this a difficult financial problem to try to sort out, but it is becoming more difficult, firstly, because the actual provision of money is being spread over a number of Votes, and secondly, because the very policy of border industrial development is changing just as rapidly. Recent announcements by the hon. the Minister of Economic Affairs make the problem even more difficult to sort out. Unless the hon. the Minister himself can give us some clarity in regard to this matter I would urge him to suggest to the Controller and Auditor-General that he should provide some comprehensive statement in regard to what is happening on the financial side and thereby coordinate what is happening in no less than four Departments all in respect of one project. I would suggest that the hon. the Minister take the Controller and Auditor-General into his confidence so that he, the Controller and Auditor-General can at least assist the House by presenting the picture as it should be presented if we are to continue to vote money for this project.

Under Loan Vote J, for the current financial year an additional R6,750,000 is provided. I think that in itself is a clear indication how necessary it has become for the House to get a complete picture of what is happening before further money is voted. I would therefore ask the hon. the Minister, if he does not give it himself, to devise methods whereby this side of the House can get a clear picture about what is happening and what the cost is to date.

The hon. member for Port Elizabeth (South) (Mr. Plewman) put all kinds of ad hoc questions to the hon. the Minister to which I shall not reply, but in regard to which I have no doubt that the hon. the Minister will give him a very good reply. I just want to come back to a few general remarks he made in his speech which I think should not now be left unanswered.

The first is that he called the Budget such an uninspired document. He regards it as unbalanced and the first thing he mentions in that regard is that there is no relief for the lower income group. Now I just want to ask him this: Will he adhere to that statement if he knows that the real wages to-day are higher than ever before as compared with the cost-of-living index? In other words, where the cost-of-living index stands at 111, the real wage structure is appreciably higher than 111. That means that the lower-paid income groups have never been as well off as to-day. The hon. member says the Budget should keep that in mind; well, it does.

Another objection the hon. member has is that no relief has been granted to the gold mines. He says the gold mines constitute the king-pin in the economy of the country. I am surprised that the hon. member can make such a statement. According to what standards are the gold mines, or any industry, the king-pin of the economy of the country? If the hon. member looks at the White Paper which the Minister issued (and for which I am very grateful), he will see that in 1963 the mining industry was one of the least important contributors to the national economy. It made the second smallest contribution. Transport contributed least. To-day it is only second on the list. Only agriculture is less. In 1963-4 agriculture, forestry and fisheries contributed R559,000,000; mining contributed R764,000,000, but the manufacturing industries contributed R 1,698,000,000 — almost R 1,700,000,000.

What would it have been without the mining industry?

Now that is very funny. What would the factories have been without the mines? What would the mines have been without the factories? One cannot say that one’s big toe is the most important part of one’s body just because one cannot jump without a big toe. Surely it is nonsense to say that. [Interjection.] The hon. member now realizes that he is on slippery ground because I am proving how ridiculous his argument is. According to what criterion can one say that this or that industry is the most important? There is only one criterion, and that is that the hon. member, who represents a constituency in which mining does not play a very great role, now poses as the advocate for the mining industry.

I should like to approach this debate from another angle. I want to begin by making the statement that the finances of the Republic are absolutely sound. I want to state the proposition—and I hope it will become clear during the course of my speech—that this is so not while the Nationalist Government is in power but because the Nationalist Government is in power.

In spite of the fact that they are in power.

The hon. member for Hospital (Mr. Gorshel) should keep his peace. He will get an opportunity to speak later. I say the finances are basically sound and therefore it surprises me that the hon. member for Constantia (Mr. Waterson) says, in the fourth leg of his amendment, that the House refuses to grant leave to the Minister to introduce his Budget “until the Government undertakes, inter alia, generally to take more effective steps to ensure the continued growth of the economy of the Republic as an undivided and integral whole”. I do not know what he means by that, because we have had continuous growth in recent years. Our gross national product to-day is R7,417,000,000. It is almost R7,500,000,000. It is 11 per cent higher than it was last year. Has the hon. member reason for thinking now that this increase will not continue? When we make the necessary adaptations to the increased prices, we arrive at a rate of growth of1½ per cent. Have hon. members reason to think that this will now suddenly deteriorate? What measures does the hon. member think should be adopted? Now the hon. member is walking out. When we look at all the countries with an expanding economy and prosperous people, we find that 5 per cent is normally regarded as being excellent. Not only do we have 5 per cent, but with the adaptations we have 1½ per cent. In the light of that fact, I think it is absolutely unrealistic to say that we have “to take more active steps to ensure the continued growth of the economy”. There is not the slightest reason for thinking that this will not take place.

When we go still further and look at the national economy as a whole, we find not only that the economy is basically sound, but we also find that socio-economically it is very sound. That brings me more or less to the statement of the hon. member for Port Elizabeth (South) that nothing is being done for the little man. If we look in the White Paper at the distribution of the total gross product, we find that over the past ten years the proportion of the national income which went to the wage and salary-earner has fluctuated very little. In 1953 it was 57 per cent of the total. We find that in Table II on page 6 of the White Paper. I am saying this for the information and edification of the hon. member for Port Elizabeth (South). If he looks at the White Paper he will see that in 1953 the proportion which went to the salary and wage-earners was 57.7 per cent—almost 58 per cent. It declined over the period of ten years to 55 per cent. If the hon. member wanted to make a point, he could have said that the Government had not taken the necessary steps to stop that deterioration of 3 per cent. When, however, he studies the position he will see that it was only over the past two years that it declined by 1 per cent every year. This is not, however, such an extraordinary decrease that one need make a great fuss about it, nor is it an important point of criticism which can be addressed to the Minister. I say that socio-economically it is a particularly sound state of affairs if one can keep the share of the item “wages and salaries” in the gross national income within limits. I agree with the hon. member that it would be good if it were to be over 60 per cent, because I am also a wage-earner like many others. But the fact is that one has the problem in a young country that one cannot give the wage and salary-earners that share which one would perhaps like to give them, as is the case in more settled countries.

My second point is that socio-economically the economy of South Africa is sound. I not only say so by reference to the fact that wages and salaries have been maintained at a certain level, but I also say so by reference to the fact that the real income per capita has increased. That can also be found in the White Paper, Sir. I should like to advise the hon. member for Port Elizabeth (South) in future to study this document very carefully, because he may perhaps find something in it which is in his favour, although I must say that I think it is a disheartening document as far as the Opposition is concerned because it just evidences the good things the Government has done.

I want to refer the hon. member to fable “A” on page 5 of the White Paper where the national income is given. If the hon. member looks at it he will see that not only did the real income rise, but that the rate also rose. What I am trying to say now, Sir, is that the share which the wage-earner had in the boom not only remained as it was but that it increased. During 1953-4 to 1963-4 it was an average of 2.5 per cent per annum. But there was also a progressive increase. When we look at the figure for 1958-9 to 1963-4, we find that it doubled to 4.7 per cent. When we look at the figure for 1962-3 we find that it is 6.4 per cent. In other words, there was a progressive increase and it trebled. The hon. member should not think that he can make any impression on knowledgeable people by saying that the Budget takes no notice of “the forgotten man”, as he put it.

What I am so grateful for is that this Budget and the economy of the country prove that we are faithful to our standpoint, viz. private initiative and the interests of private undertakings. I am grateful in the light of this fact: We are under pressure from people who want to make South Africa a welfare state. I hope that we will never experience that. When I say this, it soothes us to realize that the contributions of the private sector are still just as important as ever before. I should again like to refer to Table II on page 6 of the White Paper, to which I have already referred. If we look at it, it gives us satisfaction to see that the contribution made to the national economy by the private sector remained approximately what it was in all the years of the past. In 1953 it was 79.7 per cent and to-day it is 78.4 per cent. In fact, there was a decrease, and that decrease was in favour of the public sector, but I am grateful that this decrease was so small. Even if this decrease is analysed, we find that the public sector has a double item, viz. the purely public sector and the quasi Government bodies like Sasol, Foscor, Iscor and Escom. I think that if we analyze the position carefully we will see that the increase in the public sector which took place at the cost of the private sector is actually comprised by that part of the State which we can really also regard as the private sector. Therefore I am so grateful and glad that this Budget has also brought that point to light.

We notice the same thing in regard to savings. I am glad that in this period of socialization and socialism, where there is the tendency for the State to do increasingly more things, we have not yet experienced that. When we look at the savings we find that the private undertakings were responsible for more savings than the Government sector, viz. 55 per cent as compared with 36.2 per cent. I think that is a real achievement on the part of the Government.

Dealing specifically with the Budget, I must say that I do not find it the uninspired document it was called by the hon. members for Port Elizabeth (South) and Constantia. I think the Budget takes note of the things of which notice should be taken in this present stage of our economy. Firstly, there was a rise in the cost of living, and which people could not safeguard themselves against that? The pensioners. Ample provision is being made for the pensioners, and improvements are being made. Now the hon. member says that should have been done 17 years ago already. If we had done this 17 years ago when our national income was still in the vicinity of R3,000,000,000 only, he would have been the first to object to the increased taxation. Now that we have a national income of nearly R7,500,000,000, and grant the pensioners that relief, the hon. member for Constantia claims the credit for it and the hon. member for Port Elizabeth (South) says it is not enough and we should have done it earlier. I say this Budget takes note of the things which should be noted and at the stage when notice should be taken of them.

What I am very grateful for—and here I associate myself with the remarks of the hon. member for Pretoria (Central) (Mr. van den Heever)—is that the burgers who took part in the rebellion will also receive a pension now. To me that is a personal matter because I come from a family of gaolbirds, three of whom were in goal during the rebellion, but of which unfortunately only one is still alive. I express my thanks on behalf of the whole of the Western Transvaal, three quarters of the population of which were rebels and were almost all imprisoned.

The hon. member says the Budget is an uninspired document. I say the Budget takes note of those things of which it should take note. It combats the inflationary tendency. Now the hon. member for Constantia asks what the Budget does to assist the Reserve Bank? Part of the monetary measures effected before the Budget was submitted forms part of this Government's policy of combating a danger when it sees that danger threatening. We on this side believe that these monetary measures, i.e. the increase in the bank rate, the raising of the liquidity of the banks in relation to their obligations and the withdrawal by the Government of various deposits in banks, etc., matters which we have already discussed in previous Budget debates, will probably suffice to combat this inflationary tendency. Apart from this, the Government is applying the brake to its own capital expenditure. The hon. member is happy about it but he thinks it will not be enough. That may possibly be true; it is a matter of opinion, but we must always bear in mind the capital which will flow into the country as the result of the confidence instilled by the Government’s policy in respect of our economy.

Now the hon. member for Constantia says the Government should have reduced taxation. I do not understand that argument. On the one hand the Opposition blames the Government for the fact that there is inflation, i.e. that there is too much money chasing too few goods, and therefore we have increased prices, but on the other hand they want more money released within the economy, so that there will be more money chasing too few goods. Surely these two things are mutually exclusive. I suppose he thinks that we on this side are stupid enough not to realize how hollow his argument is.

What does the hon. member say further? He says this levy is unreasonable. Now I do not know which one of the two he was referring to. We have a levy on a double front. We have an increase in company taxation and we have a savings levy. I think the taxation on companies is a reasonable increase. If we again look at Table V on page 10 we see that that group (the companies) is the group which is most prosperous, the group which can pay. If we see what their share in the economy was, we realize that they are the group which can bear it most easily. When we look at the structure of profit distribution in the White Paper—I have read these things and I do not think people would be so stupid as to talk about it in the way the hon. members for Constantia and Port Elizabeth (South) did —we find that as far as dividends and distributed income are concerned the manufacturing industry and commerce really contributed 73 per cent of the national income; in other words, the increased benefits to them were out of all proportion compared with the others. It is 73 per cent in the case of the manufacturing industry and 71 per cent in the case of commerce. Why cannot companies then pay extra taxation? It is nonsense to say that a 5 per cent levy on the taxation of people paying more than R95 per annum is unreasonable. I think this is a very reasonable proposal by the hon. the Minister, because also in that case, if we look to see who was responsible for the inflationary tendency, then it was the personal sector. At page 10, Table V of the White Paper, we-find the following—

Then there is this sentence, which is very important—

I think under such circumstances the hon. the Minister is fully justified in reprimanding the private sector somewhat and in saying: “Because you do not voluntarily want to save enough, I think I must assist you in doing so to some extent.”

I come to the remark of the hon. member for Constantia that the Budget will be remembered as “the budget of the forgotten man”. He says the Government took no steps to combat these inflationary tendencies. The Government has been busy for three years already combating and guarding against the possible inflation which will result from its policy. Let us review that history carefully. Both hon. members ridiculed this remark. The Minister of Economic Affairs is alleged to have said: “Spend for prosperity”, and the Minister of Finance is alleged to have said: “Save for prosperity”. In other words, the one says “Spend for prosperity”, while the other says we should not spend for prosperity. This is not as ridiculous as those hon. members pretend, Mr. Speaker, because the fact is that the hon. the Minister of Economic Affairs said it three years ago when it was necessary and when there was a lack of confidence in South Africa, a lack of confidence caused by the Opposition by means of the bad image they and their Press gave of this country. Therefore the Minister of Economic Affairs said: “Spend for prosperity”. That is why the Government gave an injection of confidence in the country by announcing the Orange River project. When the Government did so. the outside world sat back and said: “If these people are prepared to spend R 1,000,000,000, if they are prepared to plan a project in connection with a river which stretches over 1,000 mites, if they have the confidence to tackle a project which will not even be completed in 30 years time, then they must have sometime”. What was the result? The result of it all was that whereas the national expenditure was at a static level, after the Minister of Economic Affairs said “Spend for prosperity” it suddenly took a flight upwards. Here are the facts. One finds this fact also in the White Paper, on page 8 in the third table and in the heading “National Expenditure”. If hon. members look at it, they will see that the national expenditure was R3,300,000,000 in 1959 and R3,600,000,000 in 1960, R3,600,000,000 in 1961, and in 1962 there was an increase as the result of the Minister’s encouragement. Then it was R3,900,000,000. In 1963 it was R4,300,000,000, and last year it jumped to R4,900,000,000. Now the Minister of Finance, three years later, says the matter has now proceeded far enough, and really a little further than is advisable or sound.

It is not as ridiculous as hon. members tried to pretend it was. But the hon. member for Constantia says further that the Government has done nothing to reduce the manpower shortage. How can he say that? When one discusses that matter, one has to consider various facets. I want to mention one, namely the infrastructures. The Government has tried to improve the infrastructure of our country, as appears from what has been spent on education and on our universities, an amount infinitely greater than it was 12 years ago. We on this side have confidence in the Government and in the country and in its potentialities, and even then we were planning for the great country which the Republic of South Africa was going to become. Twelve years ago already we took care of that aspect of our economy.

The hon. member for Constantia has another item in his amendment. He says: “The House must decline to go into Committee of Ways and Means and into Committee of Supply until the Government undertakes, inter alia, to enable the average citizen to meet the increased cost of living and obtain his rightful share of the benefits of economic expansion.” Mr. Speaker, I should like to ask whether the hon. member is pleading for higher wages? Why does he not say so if that is what he wants? But supposing that the hon. member merely means that public servants receive too low salaries, because that is the only body for which the Government is responsible, then I say that if we look at the public servants it is not true that they do not share in the increased prosperity. Or does the hon. member for Constantia wait to allege that the public servant is underpaid? If so, why does he not say so? And if he does not want to say so, why does he come forward with such a nonsensical proposal? Just let us see what the position of the public servant is. In 1948 there were 98,000 public servants, and on 1 January 1964 there were 167,000. In 1948 the Estimates amounted to R72,000,000; in 1964-5 it is R267,000,000. That really tells one nothing, but let us look at the per capita payment of the public servants. On 1 January 1948 it was R735, and on 1 April 1964 it was R1,600, more than double. Now the hon. member says: Yes, but that does not take into account the increase in the cost of living. When we bring it into relation with the cost of living figure, we find that there was an average annual wage increase of 7.3 per cent, whereas the average increase in the cost of living over all those years was only 3.7 per cent. In other words, the public servant’s position has improved out of all proportion to what it was. [Time limit.]

The Minister in his opening remarks said “in our country we cannot afford to gamble with inflation”. I agree with the Minister there. Then the Minister went on to read us a homily on inflation, and then he did nothing about it. Last year, Mr. Speaker, we warned the hon. the Minister of the danger of inflation, and the Minister in the course of his reply to the debate last year criticized us for warning of those dangers, the dangers that we foresaw have come about and this year dealing with the present Budget, the hon. member for Constantia (Mr. Waterson) and the hon. member for Port Elizabeth (South) (Mr. Plewman) referred again to this question of economic growth. They were both criticized. The hon. member for Pretoria (Central) (Mr. van den Heever) criticized the hon. member for Constantia on the question of growth and the hon. member for Standerton (Dr. Coertze) has attempted to ridicule this question of growth. But, Mr. Speaker, it is quite obvious to us that they have not read the Minister’s speech, because otherwise they would not have made such statements. Because the Minister said at the beginning of his speech: “Some temporary retardment of our rate of growth is after all a small price to pay for averting the disaster of a prolonged recession in our economy.” And again the hon. Minister said in his speech “It will be of no avail to treat the symptoms of the malady (referring to inflation), although direct action against price increases might be justified in certain cases. More fundamental remedies are required in order to penetrate to the roots of the trouble-—in other words, the containment of the growth of monetary demand.” Mr. Speaker, it is quite clear to us that the Minister admits in his own speech that he finds it necessary to retard the rate of growth, and that one of his principal difficulties is that too much money is chasing too few jobs, due to the shortage of manpower in this country, and that is having an effect on the cost structure. The Minister admits that the general price level rose in 1964, considerably higher than in 1963, and in the course of the Minister’s speech he indicated that he was concerned about the ordinary man. But here again his Budget does nothing for the ordinary man. He said “The picture I have presented to you is that of an economy enjoying a high rate of growth and widespread prosperity.” The Minister admits that he must contain that rate of growth. He went on to say “This conclusion has to be qualified in certain respects. Drought conditions are ravaging agriculture in certain parts of the country, while the lower income groups are suffering the adverse effects of rising prices, particular in respect of foodstuffs.” The hon. Minister admits that he has to curtail the rate of growth. We criticize that statement and say that the rate of growth could be increased provided we had the manpower.

What about the balance of payments? Have you ever heard of it?

The Minister’s present balance of payments’ difficulties will be dealt with in due course. You see, Mr. Speaker, the Minister comments on the large increase in the consumption of semi-durables. He referred to the fact that the motor car industry showed a 33 per cent increase in turnover compared with last year. Sir, is part of the difficulties of the large increase in consumer semi-durables not due to the fact that the Minister acted too late in regard to the unhealthy growth of credit? I suggest that the delay in curtailing credit has had the effect of increasing the amount of paper money which has caused the credit system to become congested. An example of the way in which credit has been created by certain financial institutions, is the way in which there has been put into circulation a considerable amount of paper money— paper credit and that in turn has caused prices to rise and that in turn has caused a considerable increase in the amount of consumer spending. The hon. Minister admitted that recently when he made a financial statement on 5 March and told us that there had been an increase of R346,000,000. We suggest that the hon. Minister was slow in acting. I think the hon. Minister’s difficulty is that the Minister does not like to say “no”. He does not like to say “yes”. He tries to say “perhaps”, hoping that things will adjust themselves, and the result is that if things do not adjust themselves, the Minister makes appeals to people, and people do not heed those appeals, and then the Minister has to act, and he acts too late. We see the same difficulty in this Budget. You see, last year, the Minister in the course of his reply quoted with approval one financial editor supporting the Minister’s case. I want to quote with approval an article on this Budget which says “this is a timid Budget, and it cannot halt inflation”. I refer to an article which appeared in the Sunday Chronicle yesterday, giving an analysis of the Budget. Mr. Speaker, this Budget is a timid Budget and this Budget certainly does not solve inflation. Inflationary difficulties will still be experienced after this Budget has been dealt with.

Do you want me to be more tough?

Yes, and we suggest where the toughness should start. Last year we warned the Minister that there was going to be inflation. The Minister in his reply ridiculed us and said that there would not be inflation. He told us that he had the position in hand. Last year he likened himself to a fisherman, and he talked about all the equipment of a fisherman, but there was one thing that he failed to observe and that was the change in the weather, until it was too late. Now he finds himself in difficulties and he virtually admits that he is going to have difficulties with his long-term loans, while the unhealthy competition in the short-term money market has increased the cost of money and created a supply of paper money which is causing uneasiness in responsible quarters.

The hon. Minister admits that the ordinary man is having difficulties. It is the ordinary man with whom we are concerned. He gets very little out of this Budget, and many of them get nothing at all. The hon. Minister pretends that they get something because he has not taxed them. I admit that the old age pensioners get something out of this Budget. The ordinary working man, the ordinary salary-earner has got nothing out of this Budget. It is true the Minister has relieved approximately two-thirds of the taxpayers of the compulsory savings levy, but the ordinary taxpayer will get no relief from this Budget, no relief which affects him in his ordinary day-to-day struggle against the cost-of-living, as the years pass, we find that more and more members on the Government side are prepared, as the hon. member for Standerton was prepared to do, to spend a lot of time on quoting statistics, and as the years go on they are less prepared to plead the case of the ordinary worker, the ordinary farmer, the ordinary state servant, and these are the people whose troubles require examination in this House. It is all very well to take a sheet of statistics and to attempt to quote them, as the hon. member for Standerton did, and he got more muddled as he went along, but the ordinary worker, the ordinary housewife finds that it is necessary for her husband to work longer hours, to work overtime, and in many cases the housewife goes out to work so as to give the children the good things of life, and in many cases just the necessities of life. Meanwhile if you go through the ordinary householder’s budget, you find increases in the price of meat, increases in the price of food, increases in rent, in transport. The Minister himself refers to the difficulties people are having as a result of the increased cost of food—and not only the increase in the cost of food as such, but also for instance the increase packaging costs.

The hon. Minister of Economic Affairs is here, and I hope when he gives consideration to the various developments which have taken place in this country, the amalgamation of big groups, involved in take-over bids, and various amalgamations particularly in the packaging industry, he will keep an eye open as to how that is going to affect the ordinary householder. If the hon. the Minister will examine the powers that he has under the Monopolies Act and other legislation, he will find that he has sufficient powers. Perhaps the hon. the Minister can tell us to what extent the ordinary householder is paying a larger share in packaging costs than should be necessary. When we are dealing with a national Budget, I think it is time to take stock and deal with the Budget as it affects the ordinary taxpayer, the ordinary taxpayer who is preparing his annual returns and working out what tax he has to pay, who ascertains from his employers what amount is going to be deducted from his income. Of course he is concerned with what the Government is doing to help him is his very difficult task of meeting the cost of living. There is a danger to-day of the cost spiral continuing which will have the effect not only of increasing the cost of our food but also of making exports too expensive for us to share in that market. It is this cost spiral which should receive the particular attention of both the Minister of Finance and the Minister of Economic Affairs because there is a tendency for wages to rise faster than productivity. I am not of course suggesting that wages be curtailed. What I do suggest, however, is that the emphasis should be placed on productivity. The Minister of Economic Affairs particularly must watch this in relation to factory labour in our border industries.

We have recently heard very little from members of the Government about the necessity for increased mechanization. If we are going to reduce costs, and if we are going to control the cost spiral, then we shall have to increase productivity and do so in every direction—in Government departments, in commerce and industry and in respect of land. We can take a long time if we want to examine the various facets of our economy from the point of view of reducing costs by the intelligent application of modern cost aids. When we find the Government with its large capital programme providing new buildings and facilities, then I suggest that one of the first persons who should look at expenditure is the hon. the Minister of Finance when making allocations to the various departments. Take, for example, Government buildings. How long will it still be necessary to have solid concrete walls between offices? The Minister has talked about tailoring. Well, how much more necessary is it not to erect the skeleton of a building and inside the building to have movable walls, walls which can be altered when changes in the department are made or when it is desired to change the interior design? Too many of our big buildings are really status buildings and too few are utility buildings. I think the time has come that the Government should set an example and should see to what extent it can halt the cost spiral. I think, for instance, of the many people in Government departments who do pencil work whilst so few make use of mechanical aids. If there is one department in particular that requires careful examination then it is the post office department. The whole of the postal system in the Republic is breaking down because of lack of communications owing to our inability to build fast enough to cope with the communication requirements of the country. In certain overseas countries one can to-day have any amount of business information transmitted over the wire to computers up to 200 and 300 miles away, computers receiving telexed data from various parts of the country which is co-ordinated and utilized as a managerial aid.

Mr. Speaker, to a very great extent nothing like that is done in this country. On the contrary, we are too fond of making use of old-fashioned methods, and as long as we can have an office and can put a person into it, bearing a label and enjoying a certain status, we are quite satisfied. I think the time is overdue for an intelligent examination in this respect, an examination that could start in Government departments and proceed right through the organization and methods to see to what extent something could be done about the cost spiral. The examination should have as its goal an increased efficiency in the manpower being used, and increase which should also be strived for in respect of the border industries. The main emphasis in so far as border industries are concerned is on manpower.

I should like to ask the Minister of Economic Affairs a question, and if he is unable to answer it I should like to put it to any Minister who can answer it. What happens in the case of an industry allocated in a border area when subsequently a more modern method of doing the same work is evolved, such as, for instance, the introduction of modern machines which will result in the reduction of manpower? What happens then? What will happen then as far as that industry is concerned? Will that industry no longer enjoy the benefits of a border industry or will it continue to enjoy such benefits? You see, Mr. Speaker, at the present moment the Minister is encouraging industries to establish themselves in border areas on the basis of so many Black to so many White workers. It is quite possible with certain of our technical industries to establish a factory on that basis and within a short space of time through the discovery of new techniques and inventions, techniques will make possible the substitution of manpower by machines. What happens then? Does the Black man stay and does the White man go away? Because it is certain that once you concentrate industries in this way and you introduce modern techniques, you require a very highly qualified standard of technicians to look after the technical side of the machines which have been introduced.

What will happen to such an industry when it is, for instance, in Johannesburg?

I am glad the Minister has asked me that question. Now, let me say that the industry in Johannesburg had the advantage of having a technical staff on the spot …

What happens to the Black man?

For instance, if there is a breakdown—say of an automatic loom. In such cases all that is required is to pick up the telephone and call half a dozen service people to the spot. In the case of a border industry, on the other hand, there usually are only one or two technicians for that industry. When the number of machines, however, is increased, it becomes necessary also to increase the number of technicians on the spot. Is there then going to be the necessary facilities for the services to be carried out?

But this is not the problem to which I want to refer. The Minister is granting various forms of encouragement to industries to establish themselves on the borders of the reserves. My question now is whether, when an industry no longer has a ratio of labour of, say, eight Blacks to one White and is able to dispense with three-quarters of their semi and unskilled labour units owing to new techniques being introduced, will that industry still enjoy the benefits accorded to border industries? This is a question which should be answered. If we are going to reduce the cost spiral, we have to increase productivity and we have to get new personnel. For that a vigorous State immigration policy is needed, a policy under which immigrants will come to South Africa on a far larger scale than at present. In addition we should have a more vigorous training scheme for our industrial workers. What plans have the Government in hand to assist industries in the training of unskilled and semi-skilled workers not only in our large cities but also in our border industries? The Minister will know that it is to-day not just a matter of the workman picking up information as he goes along. On the contrary, most industries have introduced training schemes. These can be seen on the mines where this is already done to a large extent. So have our secondary industries with the passage of years found that it is essential to have training schemes.

Also farmers will, with the development of new farming techniques, find that it will no longer pay them to have the expensive mechanical equipment they have to-day. In the U.S.A. to-day you will not find farmers having equipment which only operates four, five or eight hours per day. If you go to the Middle West region you will find equipment operating 24 hours a day. There contractors will come on to the farms, do the necessary repairs and checking up, and then the machines will move on to the next farm. During all this time, service records are being kept. Logs are kept to ensure that the machinery is serviced regularly. Machines which go beyond their log times in respect of service, are pulled out of service for repairs. All these modem techniques are necessary if we are to reduce the cost structure, something which we have to do if we are to reduce the cost of living for our own people and win our share of the export market overseas. Therefore I should like to know whether this aspect of increased productivity is receiving the attention of the Government.

The hon. the Minister has referred to the disappointingly low increase in savings. But what else can he expect? There is, of course, a disappointingly low rate of savings. Costs have risen. The Minister knows that the lower income groups have difficulty in buying their necessities. So how can they save? One can only save when one has a surplus. The Minister has now introduced a compulsory savings levy. To that extent he can now increase savings. But do not let us call that a savings levy. I do not call it that when I do not know whether I am going to get my money back. I regard it as being paid out and therefore I think it is a trifling with terms to call an imposition of 5 per cent a savings levy when the Minister does not tell us when he is going to pay it back …

Have you read the Ways and Means proposals?

These do not provide that it will be negotiable. So we do not know when we are going to get it back, nor do we know whether it is going to be negotiable. The former levy was negotiable whilst this new one is not. The Minister said the policy was designed to halt the excessive growth of monetary demand in respect of both investment and consumption, particularly in respect of non-essential consumption. I say that the Minister’s Department has, during the past year, created the very same difficulty about which he, i.e. the Minister, now complains.

Mr. Speaker, if the Minister is going to control inflation, he has to offer better remedies. The Minister has been timid and impractical. He has not faced up to the question of inflation. Inflation will still go on and the Minister will still have difficulties with his loan programme and with his balance of payments. This Budget is not going to solve these problems. It is all very well for the hon. member for Pretoria (Central) and the hon. member for Standerton to say that all is well and that no difficulties are foreseen. But from the Minister’s own Budget speech we can see that there are difficulties—it is quite clear, for instance, that the Minister is going to run into balance of payment difficulties probably even before the end of this Session and if not, then shortly afterwards. It is clear that the Minister has failed to budget adequately for the accounts of the country. He has failed to produce a Budget which will curb inflation and has given the average taxpayer little comfort. The only thing we can thank him for is for the partial relief he has granted to the old-age pensioner. This, however, is largely due to the fight put up by this side of the House over past years.

Having listened to the debate so far it is clear that it is very difficult for hon. members opposite to reply to the Budget. To put it crisply hon. members are struggling. I do not intend reacting directly to the many points raised by the hon. member who has just sat down. I want to react to them but I shall do so in the context of what I want to say.

The attacks made so far during this debate and during this Session have consisted of two reproaches. In respect of the one the hon. the Leader of the Opposition has given the lead to his side of the House and not to do him an injustice I want to repeat his exact words. The hon. member said, “We were not getting a fair share in the economic upsurge which most countries of the world have experienced over the last couple of years”. That is not true of course. The hon. the Minister of Economic Affairs, the hon. the Minister of Planning and other members clearly indicated subsequently that that allegation was not true at all; as a matter of fact the opposite is true because the real annual increase in our gross national income has been much higher than in the case of many other comparable countries. In respect of this allegation I want to make two submissions viewed against the background of South Africa’s growth as against that of the world outside.

My first submission is this that we could not have developed at a faster rate in South Africa without having come face to face with insurmountable difficulties in regard to our manpower position and our balance of payments and reserve position. I therefore want to submit that no matter what people say we could not have developed at a faster rate.

My second submission is that our economic growth rate could not have been at a faster tempo without having done what the United Party wanted us to do and that was to employ non-Whites in all spheres of the economy of South Africa. Had we done so we would not have had prosperity in South Africa and we would not have been able to retain the balance. In that event doubtful benefit would have accrued to us which would have formed the economic basis for losing White political control. I do not want to be diverted from the point I want to make because of what I have just said; I merely make that submission in response to the reproach that we could have developed at a faster tempo. For these two basic reasons our economic growth rate could not have been at a faster tempo.

A second reproach that has been levelled against us is that we have “mismanaged the prosperity of South Africa”. Those were the words used by the hon. the Leader of the Opposition, and the hon. member for Port Elizabeth (South) (Mr. Plewman) also talked about “imbalances”. I wish to say immediately that this reproach implies an imbalance in the economy of South Africa. Against this I want to submit that the most important characteristic of our economy is its very balance. And when we have to judge the balance of the economy it must be viewed from both the short-term and the long-term point of view. As far as the long-term point of view is concerned you have three specific large units which ensure the balance of our economy. These units have been planned because our economy is a planned economy. I want to mention the three most important ones: they are the steel industry, the chemical industry and the textile industry. The balance comes into the picture in that these three industries have been developed on a large scale, have served as props in our economy thus providing the necessary security of employment to labour and which, because they have reduced our imports from overseas, have consequently influenced our balance of trade and balance of payments. But apart from that—and this is also my reply to the hon. member who spoke before me—the second most important point as far as our balance is concerned is the balanced way in which our industries have been sited in South Africa. That has been the inherent factor in distributing our prosperity beneficially throughout the country. We must not lose sight of the fact that ours is a country with certain disadvantages. Ours is a big country and our people, our supplies of raw material and water resources are unevenly distributed throughout the country. So that the whole South Africa could benefit from the prosperity the specific policy has been to distribute the industries over the whole country. By doing that the economy has ensured that the whole nation has benefited equally, as have the various areas of South Africa which supply our raw material and it has also exerted equal pressure on our transport system. The hon. Minister of Transport will agree with me when I say that it is precisely because of the distribution of industries that it has been possible to handle the transport situation. A remark has been made to-day in connection with the border industries but the very fact that we have enjoyed prosperity, due to the distribution of industries throughout the country—also in the border areas—will make it possible in future to have a balanced growth in which all sections of the population, including the Bantu homelands will have a better share. Their primary development lays the very foundation for a balanced growth and development of their respective economies. That is why I say that its balance is our economy’s strongest characteristic.

Also as far as our import and exports are concerned—and this is my third point concerning our balance—these have been planned so as to make us less vulnerable. As far as our export of raw mineral materials is concerned the emphasis is placed on those exports which give us a cost advantage and offer us a safe market. It is also linked with our whole political set-up as far as our exports are concerned in that we make an essential contribution to the industrial production of the West and inasmuch as the balance of our economy also has a political implication it is of cardinal importance. But what is more, as far as the export of manufactured goods is concerned, the emphasis is placed on those very exports which give us a relative cost advantage. That is the reason why we can expand and sell products related to the metal industry at competitive prices.

But we are also encouraging the export of those agricultural products which give us a quality and seasonal advantage. I have two examples in mind. I think of the wine industry where we really have a quality advantage and I think of the fruit industry where we have a seasonal advantage. That is why I say that as far as our exports are concerned they are arranged in such a way that they fit into a balanced pattern. This also applies in the case of our exports. We emphasize the importance of replacing those imports which may make South Africa’s economy vulnerable. That then as far as the reproach in connection with the balance of our economy is concerned.

It is true that every young and growing economy has growing pains. There is not a single growing economy which does not experience bottle-necks. If the growth rate is fast there is pressure and when there is pressure you get bottle-necks. As far as bottlenecks are concerned there are three things to be remembered. In the first place in any growing economy bottle-necks are normal occurrences and I want to make this submission that, in spite of the allegations made by hon. members opposite, bottle-necks are normal occurrences in all developing economies. What is important in this connection is the fact that bottle-necks are of a temporary nature and can be overcome. What is also important is to ensure that those bottle-necks remain under control. We have the position as far as our economy is concerned that our economy will either right itself, as any sound economy does, or if it does not right itself the State will step in with adjusting measures as the hon. the Minister had already done in the past. Three years ago we experienced a slackening tendency in our economy and by way of fiscal measures the hon. the Minister as well as the Minister of Economic Affairs, by relaxing import control, as well as lowering interest rates, which is a financial measure, restored the vitality of the economy and it again went its normal way. The point I am making, therefore, is that where the economy needs it, if there is no balance, the Government can assist.

A great deal has been said recently about the highly liquid position of our banking system. That has exercised an influence in various respects. The result was that too much money was spent on consumer goods which in turn caused an excessive increase in our imports. That also resulted in a reserve shortage and a deterioration in our balance of payments position with a consequential drop in savings. But the steps the Minister is already taking will have the effect of less money being spent and of encouraging savings. I mention these examples to indicate how the Government can assist the economy by means of adjusting measures.

I want to say a few words in connection with the agricultural sector. Agriculture is at the moment experiencing a very severe drought. As far as agriculture is concerned the position is that it normally rights itself. But when such extraordinary circumstances obtain as those brought about by the present drought the Government is prepared, and has indeed done so in recent times, to assist to overcome the set-backs and we are very grateful to the hon. the Prime Minister for having given us the assurance that the Government will help agriculture. We are also grateful to the Minister of Finance for having promised assistance. On behalf of all those areas which are experiencing these set-backs I also want to express my appreciation of that. As far as that is concerned it is something which can either be overcome or which will right itself. And if it does not right itself quickly enough the Government can do so by means of adjusting measures.

As far as maintaining our economic balance on a long-term basis is concerned three important props have been established in the part. As far as the balance on a short-time basis is concerned there is no reason to panic or for recrimination. In fact, in view of the examples I have given, the Government is ready to step in with adjusting measures where necessary. Recently, however, there has been a tendency to over-spend on luxury consumer goods. The Minister is aware of this and has issued a warning in this connection. Too much of South Africa’s money is flowing to those institutions which specialize in financing luxury consumer goods, goods which are used in excess. I have in mind motorcars, refrigerators, gram radios, furniture and all these things which, I think, are being acquired in excess. This excessive credit also carries a high rate of interest with it but in spite of that we find the economy is prepared to carry it at that high rate of interest and that the high rate of interest in these cases do not scare people away. It has, however, serious repercussions on our economy. In the first place it destroys the tendency in the nation to save. The indications are there that it has reduced the tendency in South Africa to save. In the second place it creates a false sense of prosperity and a false sense of standard of living because it encourages reckless spending and it stretches credit economy to its utmost limits. It also attracts money away from those fields where it could be more usefully employed. I also want to add that it promotes interest warfare. We have already witnessed interest warfare. The Minister had to step in to put a stop to that and we are grateful for that. It has been said that the agricultural sectors may suffer as a result. We already have the answer to that and it is not necessary for me to give a further reply.

The fact remains that the Minister is now trying to stop it and we are grateful for that. The indications are also there that our commercial banks are very responsible institutions and that they will disclose the necessary sense of responsibility in these days and not abuse a position which has been brought about by an Act of God by placing the additional burden of increased interest rates on drought-stricken areas, or even of withholding credit.

That will be the day!

Before I got up to speak to-day I took the trouble of asking responsible people what the policy of their personal banks would be and anybody who inquires into the position will be given the assurance that the position will not be abused. [Interjections.] The Minister has warned against that but I want to say that imbalance will set in if we were to become enslaved to a spendthrift economy involving too large a portion of our national production capacity. That is why we are grateful that the Minister has acted the way he has because, had he not, wages would have been affected; wages and prices would have risen to such heights that a chain reaction would have set in. But I want to leave it at that; I think I have said enough on that subject.

A few points of criticism have been raised. In the first place it has been alleged that the cost of living is too high and that the salary structure has not kept pace. The hon. member for Standerton (Dr. Coertze) has gone into that as well as the hon. member for Pretoria (Central) (Mr. Van den Heever). When this allegation is made the question of inflation is erroneously brought in, suggesting that inflation means inflation that cannot be controlled. That would indeed be unsound inflation. I want to read what the recent quarterly statistical journal of the Reserve Bank has to say on this subject—

I do not think there is a better authority than the Reserve Bank itself. The purchasing power of the public has increased and that has made possible the selling of greater supplies at higher prices, but that is not yet inflation. Increased salaries and wages mean a greater demand but that does not yet mean that the position has become inflationary. The test we ought to apply when we talk about inflation and wage increases is the following: We must ascertain whether wages and salaries have kept pace with the cost of living and whether earnings have kept pace with expenditure on basic needs; in other words, whether salaries and wages have kept pace with what people have to spend on relaxation, transport, food, etc. Apart from the arguments already advanced I just want to state one point of view. In recent years salaries have been considerably increased in South Africa. Over a period of two years salaries in the public sector have been increased by a total figure of R38,000,000. The total figure has not been reduced to a percentage basis; we only know it has taken place. We also know that in the private sector higher wages are paid than in the public sector and we also know that the cost of living index has risen by 4 points. If we do not want to regard it as a figure I want to add that over a period of two years, in 1962 and 1963, R123,000,000 more was spent on luxury consumer goods, i.e. those that I mentioned early on. When we take into account the fact that 139,000 new motor cars were registered in South Africa last year and that we are second on the list after America as the country with most motor-cars per 1,000 head of the population we must come to the conclusion that after wages and salaries have been spent on the ordinary necessities of life sufficient remains to make spending on this scale possible. What I want to say is that the wage earner was entitled to share in the prosperity and he got his share and in future he will also enjoy his share of the prosperity. But what we admire is the measure of self-discipline the salary and wage earner has applied to themselves because their self-discipline is also their guarantee and their protection. That was why the economy could keep its balance in such a way that we enjoyed security in a murderous competition, something we would not have been able to do had the wage and salary earner not made it possible for us to do so. But they also saw their own future safety in that. While I am talking about the salary and wage earner I just want to say a few words in connection with company profits.

The indication is that during the past four years companies in the commercial sectors have showed a 79 per cent increase in their profits and 74 per cent in the industrial sector. That is too high and I think as far as company profits are concerned the same measure of self-discipline should be applied as that applied by the salary and wage earner. Because surely in an expanding economy accompanied by increased production and bigger profits the public is also entitled to their share. I do not want to make any reproaches but I think the private sector can fruitfully consider the question of whether it is not moving too fast along the road of prosperity. I think we on this side of the House should also warn that if there should be reaction to such profits in future the position would be indefensible.

I want to make a second remark in connection with another point of criticism regarding our manpower position. The reproach has been levelled at us that there is a serious manpower shortage. I do not want to mention the figures which have been mentioned from time to time but I think it is also necessary that we view the manpower position in its right perspective because we are a young country and in recent years the increase in the number of new undertakings has been astronomical. South Africa has ventured forth into numbers of new fields and has done so on a large scale. We are not an old industrial country with a reservoir of technicians from which to draw. We have had to do two things at the same time. We have had to develop and train the people simultaneously. For that reason we cannot be unduly criticized because of the manpower shortage. Many of the new industries are in the meantime also playing the role of training centres for the people in their employ. Take the example of Sasol. When we started Sasol there was nobody to teach South Africa but to-day we are leading the world. That has happened but in the meantime the Government has embarked on a gigantic training programme in order to narrow the gap between supply and demand. In 1955 there were 23,000 students at universities and in 1963 that figure had risen to 40,500. In the case of vocational training there were 17,000 in 1955 and to-day there are more than 30,000. A bottle-neck in respect of trained manpower also sets other factors in motion. As soon as there is a shortage the standard of efficiency must be increased and more mechanization must be introduced.

In conclusion I want to deal with another point and that is the criticism that all members of the public do not share in the prosperity. What yardstick do you use to test such a general statement? What test must be applied? Must the test be pensions or salaries or what? I maintain that over and above the physical income in which everybody shares there is one important national income which everybody ignores and that is the increased prosperity of the entire country, the way in which the entire nation has been able to live better socially. All that forms part of the prosperity and if the hon. Minister spends far in excess of R 1,000,000,000 he spends it on the entire nation does he not? [Time limit.]

Sir, we have had a very interesting address from the hon. member for Soutpansberg (Mr. S. P. Botha) and I should like to spend a good deal of time replying to him, but of course that will not be possible. He took as one of his major points that there was no imbalance in the country to-day. He dealt with three facets; in the first place he said that there was no imbalance in the type of our industrial production, that there was no imbalance in the distribution of our industries and that there was no imbalance between our imports and our exports. But the problem that we are dealing with to-day is a different type of balance as the hon. member well knows, and it is no good avoiding this problem by bringing to the notice of the House balances in other aspects of our economy. He then went on to say that we were a young country and that we must expect growing pains. Sir, I think we all accept that growing pains are essential to youth, but one tries to see that these growing pains are reduced as much as possible, and where he says that the Government by its controls must take care of the growing pains, that is perfectly correct, but what we want to try to avoid is the start-stop policy that we have had through the planning of the Government. It has been mentioned here already this afternoon and I do not want to labour this point, but one day the public is told to save and the next day it is told to spend. I do not know what the public will be told next; maybe somebody will eventually find a mean between spending and saving and then we will get somewhere. But one thing that the hon. member did say is perhaps something which the hon. the Minister might comment on at a later stage of this debate, and that was that profits were too high. He issued a warning to commerce and industry that profits were too high and that these high profits were affecting the purchasing power of the man in the street. Does this mean that what we are going to be faced with in the not too distant future, is an excess profits tax? Is that contemplated by the hon. member and by the Government? Are we going to have a more rigid application of price control, which so far we have been spared? Is that what the hon. member means; is that part of Government policy? You see, Sir, the hon. member must be careful, because this question of a percentage increase is raised from time to time in this House without giving due consideration to what a percentage increase may mean. A company may make a profit of R1 per year and show a profit of 100 per cent if it increases its profit to R2. On the other hand it may have a profit of R1,000,000, and in that case a 100 per cent increase would increase its profits to R2,000,000. One has to be careful therefore in throwing percentages around; it would be far more intelligent to examine the actual difference in the profits.

Sir, the hon. the Minister’s Budget speech really fell into three parts. First of all he gave us an analysis of the present economic position of the country. I think it was a very excellent analysis. Then he gave us an appreciation of the situation based on this analysis, which I think can be summed up in one word and that is “inflation”. Thirdly, he made a number of proposals coupled with some rather vague statements, whereby the Minister hopes to bring our economy back into balance. But, Mr. Speaker, the hon. the Minister has a problem. Accepting the fact that he now faces an inflationary period that can become dangerous if not curbed, he unfortunately is unable to deal with this problem purely on its merits. His remedies are restrained by the over-all policies of the Government, and his flexibility of action and manoeuvreability are contained within the narrow confines of apartheid, because basically, as has already been said here this afternoon, the main purpose of his Budget should have been to achieve greater productivity; his objective should have been to reduce costs of production and to widen the scope of our export markets. Sir, where have we had these things in the Budget? Nowhere in the Budget is there any indication of steps which are likely to achieve these things. The hon. the Minister’s own political thinking prevents him from encouraging the proper utilization of our labour force, thus increasing production and lowering costs and at the same time it creates artificial barriers to our export trade.

We know that the problem of combating inflation is a very complex and delicate one. The hon. the Minister put it very well when he said—

That is correct, Sir: Too little restraint and you have a boom and bust; too much restraint and the seeds of depression are sown. But there is nothing in the hon. the Minister’s speech that gives us any assurance whatever that he has found that fine balance of action that will give us, to use the words which the hon. the Minister himself used, a year ago in his Budget speech, “that glittering prize of economic growth with financial stability”. There is too much uncertainty in the hon. the Minister’s Budget speech. There are too many reservations. He tells us, for example, that the Budget can be a delicate instrument, influencing the various sectors of the economy in different degrees, according to the individual needs. But then he adds, “at least in theory”. Mr. Speaker, we would have expected the hon. the Minister and his advisers to have produced a Budget based on the economic facts at their disposal, not a plan based on theory. We would have expected a plan in which the hon. the Minister had full confidence. We did not expect the hon. the Minister to say to us, after producing his plan, “this is a theoretical plan; I am not quite sure what is going to happen”. Sir, that is the over-all impression that one gets from the hon. the Minister’s Budget speech. One gets the impression that he himself is not quite certain what the results of these proposals are going to be. One’s feeling of uncertainty deepens when one reads other portions of the hon. the Minister’s speech. He says, for example—

That, of course, is undoubtedly true—

Sir, the hon. the Minister is well known for his choice of expression and his turn of phrase. But what does this really mean? At what future stage does the hon. the Minister mean? This year, next year or the year thereafter? We do not know how we stand with the hon. the Minister. Are we going to have a sales tax at some time in the future? What other instruments are going to be considered, and when are they going to be considered? It is most unusual for the hon. the Minister of Finance in introducing a Budget speech to deal with tax proposals other than those actually imposed by him, but here we are told of certain things that he is going to do and a host of other things which he may do or may not do. Then again, on the question of savings, about which I shall have more to say later, the hon. the Minister says—

What does this mean, Sir? Is he going to take action to encourage savings or is he not? He goes on to say—

Surely, Mr. Speaker, this House is entitled to more from the hon. the Minister than vague references to steps he will have to take to combat inflation. Surely the Budget debate is the right and proper place for the hon. the Minister to tell us exactly what his policy is; not to say “this is what I am going to do at the moment, and this is what I may have to do in the future; this is what I am considering doing or this is what I may have to consider doing.” The hon. the Minister goes on to say—

Does this mean that the hon. the Minister and his advisers are going to take measures which have not yet been formulated? If I were a member of the hon. the Minister’s profession I might be bold enough to say that the hon. the Minister’s Budget speech this year was vague and embarrassing.

But, Sir, there are other matters that we want to consider. The hon. the Minister tells us that the rise in the consumer price index for 1964 was 4.1 per cent as against 1.4 per cent the previous year. He also tells us that it will not be unreasonable to assume a growth rate at current prices in the gross national production of between 7 per cent and 1½ per cent per annum, and that this has served as the basis of his calculations. But, Sir, if the increase in the consumer price index continues at 4 per cent for 1965, then the rate of increase in the real gross national production will be only 3½ per cent. This is an increase of 2 per cent less than the 5½ per cent said to be required by the Planning Council.

The average over five years.

That is what I want to get from the hon. the Minister.

The rate is already 1½ per cent.

The Planning Council said that it had to be averaged over five years, so what the hon. the Minister is now telling us is that this year it will only be 3y per cent.

Oh no.

What will it be this year?

I said that I hoped that costs would come down.

The real gross national production …

No, the gross national production is per cent.

Does the hon. the Minister anticipate no increase then in the cost of living?

I said I hoped the cost structure would come down.

I can only express the hope that the hon. the Minister is correct. I find nothing in this Budget to indicate that that is likely to take place and it seems to me that the hon. the Minister may well find himself at variance with the Planning Council at the end of this year.

Sir, another speed is the question of savings. One of the points made by the hon. the Minister in his speech is that the total savings increased by only 2 per cent in 1964, as compared with 7 per cent in 1963. He then went on to say—

Sir, that is perfectly true, but surely the hon. the Minister will agree that one of the best incentives for saving is the interest that can be earned? We know that the hon. the Minister has certain problems as far as interest is concerned but I would like to refer him to a leader in the Financial Mail of 26 March, which I think put the position extremely well. This leader deals with the question of inducements to make people save, and it says—

Freezing interest rates at a time when policy makers are searching for ways and means of increasing saving and decreasing spending, appears to be the ultimate contradiction in monetary policy.

I hope the hon. the Minister will explain to us in the course of his reply to this debate how he reconciles his desire for greater savings by the public with his depressing of interest rates.

The hon. the Minister has transferred to capital account his surplus of R 110,000,000 for the year. This, of course, is nothing new. But this year he has gone a little further; he is also utilizing the R20,000,000 in the Tax Reserve account. He is taking from Revenue for the current year R30,000,000 for capital expenditure, plus the loan levy of R 13,300,000. Surely, Sir, these steps are only part of anti-inflationary? Surely it matters very little whether the spending is by the private sector or the public sector. I realize, of course, as well as the hon. the Minister, the benefit of using funds that would be available for consumer buying for Government capital works instead of finding investment capital. But, surely the real anti-inflationary action would be to curtail Government spending to some extent instead of increasing it by R 155,000,000 on capital works.

Then, Sir, we have another statement from the hon. the Minister and I am afraid we are not very impressed by it. The hon. the Minister said—

I do not have to tell the hon. the Minister, who must have a great deal more experience than I have, that historically, in good times when funds are available, the demands of the Central Government and other authorities are insatiable. It is only in times of depression when Governments should be spending money that other authorities do not seem to be able to get money from the Government. In times of prosperity there is a never-ending drain on the available funds.

Sir, I want to come now to the loan levy. I suppose that the loan levy has some merit in a period of inflation, but, as has already been mentioned by the hon. member for Pinetown (Mr. Hopewell) this one sets a very dangerous precedent. There are normally three fundamental principles involved in the lending of money, whether on a voluntary or on a compulsory basis, and that is, firstly, the worth of the borrower, secondly the rate of interest and, thirdly, the term of the loan.

The hon. the Minister said by way of interjection when the hon. member for Pinetown was speaking, “Why don’t you look up the income tax proposals which have been already published?” Sir, I have looked at them and they say that the loan shall be repayable to the taxpayer at such times and such conditions as may be provided in the Act. But what did the hon. the Minister say in his speech? He said—

and I do not know what the hon. the Minister means by “now”—

Does it mean that he is going to tell us next week when these loans are going to be repaid, or next year, or the year thereafter?

Be your age!

I would like to suggest to the hon. the Minister that he should fix a maximum period during which these loans will be repaid; he will then have enough flexibility to maneouvre …

That will be provided for in the Act.

Why then did the hon. the Minister say in his Budget Speech, “I do not wish to bind myself now?” Does “now” mean the difference between the date of the Budget Speech and the date of the introduction of the Bill? The hon. the Minister should make the position clear because this Budget Speech is about the murkiest document that it has ever been my unhappy lot to read.

I want to make another suggestion to the hon. the Minister. Now that the Government has decided to impose a loan levy, I would have hoped that the hon. the Minister, instead of taking R30,000,000 out of revenue account and using it for capital works for 1965-6, would have reduced taxation by this amount and then imposed, if absolutely necessary, an additional loan levy for an equivalent amount which would at least have been refundable to the taxpayer at some future date. I hope that the hon. the Minister will take this matter into consideration. He has taken from the taxpayer more than the taxpayer should have paid; the Minister finds himself in a position where he says that because of inflation he cannot give anything back to the taxpayer now. Well, let him at least give it back to the taxpayer at some later date; let him reduce the taxpayer’s tax and raise that amount by way of an additional loan levy which will be refundable to the taxpayer at some future date.

Last year, Sir, I raised the question of a certain amount of tax relief for the working married woman. The hon. the Minister, in his reply to me, was good enough to say that he would go into the matter during the recess. I am grateful to the Minister for having done so, but the step he now proposes to help these women, namely that the tax levied on the combined income of the husband and wife be calculated at the tax rate applicable to an amount equal to the greater of the two incomes, plus one-half of the smaller income are to my mind entirely inadequate. I do not propose to deal with this matter in detail; that will be done by the hon. member for Benoni (Mr. Ross). But there is very little incentive for people in the lower and middle income groups to go out and work because the tax saving is negligible and I hope that the hon. the Minister will reconsider the position after he has heard what the hon. member for Benoni has to say about it. I think the hon. the Minister is also wrong in limiting this relief to joint incomes up to R8,000-plus. It is equally important to grant relief to women in the higher income groups, such as women doctors, women scientists and women executives, who earn quite large sums of money and who fill important posts. The services of women in these top echelons are as important to us as the services of women in commerce and industry. and I hope that the hon. the Minister will have second thoughts on this matter, before he finally implements these proposals of his, and see to it (a) that greater benefits are given to people in the lower income groups and (b) that there will be no ceiling to the joint incomes of husband and wife. I would also like to know from the hon. the Minister how he proposes to deal with this concession under the P.A.Y.E. system. Will the married woman now automatically work out her commitment for P.A.Y.E. at her reduced rate of tax, or what alternative procedure is to be adopted?

Sir. one of the more positive proposals of the hon. the Minister is the inducement of a larger pension offered to White persons who work longer and postpone their applications for old-age pensions. I think this is a proposal which we all welcome, but I want to ask the hon. the Minister to go further. I want to suggest to him that there should be an additional inducement; that a special allowance should be granted to taxpayers over the age of 65 years. I make this proposal for two reasons; firstly because it will induce elderly people to extend their working life. Many of these people are not in receipt of pensions and they need some inducement to continue to work longer; secondly, because it is a social benefit to which men and women in the twilight of their lives are entitled. Thousands of people who have given years of service to commerce, industry or the State, find themselves on retirement with greatly reduced incomes. Pensions, for example, which are taxable are never equivalent to previous earnings. For those without pensions, their sole income when they stop working is often the money earned on their life savings which has been invested. To me it seems right and proper, apart from the fact that they will be induced to work longer if they are given this tax relief, that they should be entitled to this tax relief in return for the services which they have already rendered to the State; when I say “the State” I do not mean directly but through the different occupations which constitute service to the State. I know it will be said that people of that age will pay less tax because their income will be lower; that their needs will be smaller because their families are grown up but, Sir, it is interesting to note that in the United States of America they have a provision in their income tax law whereby a person of over 65 years of age is granted an additional tax exemption of $600, irrespective of his income, and if the man’s wife is also over 65 years of age. she too is granted a special exemption of $600. Between the husband and the wife, therefore, they receive a total tax exemption amounting to $1,200. Sir, when you meet some of these elderly people from the United States they tell you what a great tax relief it affords them that the first $1,200 of their income is not taxable; they tell you that it makes a considerable difference to their standard of living. I hope that the hon. the Minister will give this matter some consideration.

Sir, there is one other matter I want to raise. I hope the hon. the Minister has not forged a two-edged sword with his surcharge of five per cent on the income tax payable by companies other than gold-mining companies. I hope he is not going to cut off the head of the goose that lays the golden egg. One of the reasons for our present prosperity is that the fiscus has allowed the entrepreneur and the business man and the investor to retain a reasonable share of the profits earned after satisfying the fiscus. These companies will now have to pay an additional five per cent on their taxes, and R 16,000,000 will now find its way to the Exchequer. This means that R 16,000,000 less might be available for dividends which is obviously what the hon. the Minister is trying to achieve. But, alternatively, it might mean that R 16,000,000 less is available for expansion of production, for modernization of plant and equipment, and for the installation of more efficient aids to production, and that the efficiency of production might be impaired. It is possible that this additional tax may well have the reverse effect to that which the Minister is trying to achieve.

There is one other aspect of this type of taxation. We are told by hon. members on the other side that they do not want any socialism in this country; socialism, they say, is a wicked thing and a bad thing. If you start imposing additional taxation upon certain sections of our community you are taking the first step towards socialism. When you say, as the hon. member for Soutpansberg said, “The profits are too high, we must take some portion of it away from these companies,” or when you select a certain group of person and tax them, then you are beginning to steer very close to the wind. Sir, I hope the hon. the Minister will give his serious consideration to the matters I have raised here and deal with them in his reply to this debate.

The hon. member for Parktown (Mr. Emdin) referred sneeringly to the planning of this Government.

Bad planning.

I should like to remind the Opposition that people who live in glass houses should not throw stones. Of course, the Opposition cannot be accused of a lack of planning; on the contrary, they have a number of plans but the unfortunate thing is that their plans are not always what they should be. The Opposition are always making plans to win elections. We have heard so little about politics in this debate this afternoon that I should like to talk some politics now. The Opposition are engaged upon plans to grip the imagination of the voters and to win their confidence. Their Senate plan was not successful in this regard; nobody could understand their federation plan and if we are to judge from the result of the provincial elections last week, their policy of White leadership throughout South Africa has not found favour with the voters either. Mr. Speaker, the Nationalist Party does have plans, many plans. The difference between the Nationalist Party and the United Party is simply that the plans of the Nationalist Party are put into practice one after the other. I just want to refer in passing to the freedom plan of the Nationalist Party. That plan, born in the years of humiliation and defeat, has been implemented step by step with determination and conviction. I do not want to elaborate in this regard. I just want to emphasize that those plans resulted in the Republic of South Africa. I want to ask the hon. member for East London (City) (Dr. Moolman) whether that was not a good plan. Our apartheid plan, in spite of the strongest opposition here as well as overseas, is growing in stature. There is a multitude of voters behind the Government and behind the Nationalist Party in the implementation of this policy. The hon. member for Green Point (Maj. Van der Byl) can vouch for this. The voters realize that this Government, unlike the Opposition, does not wander about aimlessly but that it has somebody in control who has a definite purpose in mind. Because of this fact, the Government has left no doubt in the minds of the people in regard to the direction it wants to take. In his speech at the opening of the First Session of the First Parliament of the Republic of South Africa, the State President mentioned four points particularly on which the future would be built. The first was that we would aim for national unity. The second was that every effort would be made to foster good relationships with the outside world. The third was to foster good race relationships in this country and the fourth was to improve the economy of the country to such an extent as to ensure the peaceful and happy co-existence of all population groups in the country. All the actions taken by this Government must be considered against this background. This Budget must also be considered against this background.

Before dealing with the Budget I should like in passing to refer to the amount of progress that has been made in regard to the planning which has already been announced. Nobody will dare deny that progress has been made in the field of national unity. I am sorry to have to repeat it but the results of the past election have produced undeniable proof in this regard. As far as the outside world is concerned it is pleasing to see and to know that foreign countries are at last seeing South Africa in her correct perspective. It is a significant fact that certain newspapers abroad have printed reports in this regard. The New York Times wrote as follows—

All they had to do was add that this was the Republic of South Africa. What is more. I saw the following report in the Argus last Saturday—

They go on to explain—

The Budget confirms what has been contended in this newspaper article—that there is stability in the development of the economy of our country and that the continued prosperity and upsurge in this country is stronger than was ever anticipated would be the case. This growth and development has simply to be channeled correctly in order to ensure a sound balance in the economic structure of the country. That is why we welcome the recommendation of the economic development programme which has been drawn up by the office of the Economic Advisory Council of the hon. the Prime Minister. It points out the necessity for a balanced development in the economic sphere. One welcomes the fact that the directives contained in these recommendations are to a large extent reflected in this Budget. But one is concerned at the fact that there are trends which may possibly disturb the sound balance of our economy if they are not curbed in time. That is why we will welcome the fact if within the framework of an economic programme and within the framework of our financial policy attention is given to these tendencies in the economic structure of the country. One of these I want to mention and discuss is the production of gold in the country and another is the retrogression of our agricultural industry as a result of prolonged droughts. Here I want to emphasize, Sir, that the retrogression of our agricultural industry is a result of protracted droughts and not as a result of incorrect farming methods; not as a result of a poor agricultural policy on the part of the Government but as a result of natural disasters. Dealing with the last item first, I want to say that we note with appreciation the announcement in the Budget Speech of the hon. the Minister of Finance that this matter—the retrogression of our agricultural industry— is receiving the serious attention of the Government and that adequate funds will be made available not only for emergency loans but also for the building up of our agricultural industry. One is particularly concerned at the fact that our agricultural industry has reached the stage where it will probably not come up to the expectation of our economic development programme for the next five years. It was anticipated that the contribution which the agricultural sector would be able to make to our gross domestic production would increase in absolute amounts. It was also anticipated that the number of Whites employed in agriculture would gradually decrease. This is not something new. It is a general occurrence that as the economy of a country grows, the percentage of the workers employed in agriculture drops. But I am afraid that as a result of drought conditions this percentage is going to be so high that it will have a detrimental effect upon our agricultural industry. It will lead to further problems and difficulties in connection with the occupation of the platteland. We know that the economic upsurge in our country is accompanied by full employment, even of the younger generation. This results in improved living standards, increased purchasing power, increased consumption and so forth. For agriculture it means the supplying of more and better foodstuffs at economic prices, to the producer as well as to the consumer. This is the challenge facing the farmers of the Republic of South Africa to-day. The farmer can and will accept this challenge once natural conditions return to normal, but a steadily decreasing farming community may find this challenge too much for them. That is why we hope that the measures which are going to be taken for the rebuilding of our agricultural industry will be aimed at keeping as many farmers as possible on their farms and returning to their farms as many farmers as possible who as a result of these circumstances have had to leave their farms. Then and only then will the farmer be able to supply the food requirements of the country and will we be able to ensure that a sound balance will be maintained in the economic structure of the country.

In the second place I should like to say something in connection with the production of gold in our country. The gold mining industry is one of the most important foundation-stones of the economy of the country. While the Republic is in essence still an export country. which according to the White Paper, exported goods to the value of R955,000,000 in 1964. gold has played a leading part in earning important foreign currency for us. It must also be acknowledged that the gold mining industry has stimulated the development of our country in numbers of spheres. We think of the railways which developed as a result of the transport requirements of the gold mines. We think of the development of our coal fields as a result of the requirements of the coal mines. We think of the development of our agriculture as a result of the supplying of the foodstuffs required by the gold mines. We think of the fact that the oil and steel industry in its initial years served as a service industry for the mines. We think of the manufacture of explosives. This was undertaken in order to supply the requirements of the mines. There is the question of the generation of power. This was encouraged in our country because gold mines were important users of that power. It is interesting to know that the Republic of South Africa is to-day generating half of the total power generated in Africa and that the gold mines are using half of the power generated in the Republic. The mines are to-day also important consumers of our locally manufactured goods such as machinery, mining requirements, chemicals such as nitric add, sulphuric acid, lime, steel and so forth.

According to information supplied by Mr. Anderson, President of the Transvaal and Orange Free State Chamber of Mines, the following figures are significant: During 1963, the mining industry purchased South African timber to an amount of R 16,000,000 and they purchased maize, meat, vegetables and other foodstuffs for the compounds to an amount of R 17,800,000. The gold mining companies as a whole purchased goods to the value of R265,000,000 in 1963, of which less than 7 per cent were imported.

Mr. Speaker, for these reasons it is an undeniable fact that the gold mining industry plays a very important part in the economic development of our country. There are two aspects in particular in connection with the gold mining industry which require closer inspection. I say this in the spirit of trying to keep the goose which lays the golden egg alive as long as possible. In the first place, we are dealing here with a disappearing asset, and, in spite of the fact that large scale prospecting for gold has been going on over the past while, it appears as though the results have not been very encouraging. We have reached the stage at which the total quartz deposits which are still in the ground can be evaluated. That is my first point.

In the second place, we notice that no determined efforts have as yet been made to ask for an increase in the gold price. While an increase in the gold price appeared impossible some years ago, it appears as though the climate in this regard is becoming favourable, particularly having regard to the mergence of a third economic power in Europe.

I have here a cutting from The Star of 29 September 1964, in which the following appeared—

The French are helping us to agitate for a higher gold price. I also have here a newspaper cutting of a speech which Dr. Buxebau made in which he also said that in our evaluation of the gold mines we have to consider the fact that there may possibly be an increase in the gold price in the near future. I mention this merely as a proof that we must not lose sight of the fact that there may perhaps be an increase in the gold price within the foreseeable future. It may only be a question of time before America loses her power grip on international monetary politics which must then of necessity lead to an increase in the price of gold. That is why one wonders whether it is a sensible thing, under the present circumstances in which an increase in the gold price may take place in the near future, and because of the fact that our gold-bearing deposits in this country are restricted, that we should increase our gold mining production to record heights. One reads too often what has been reported here in connection with the Free State gold mines: “Higher production and record profits by O.F.S. gold mines; higher dividends of three companies envisaged; higher crushing rate and further improvements in efficiency and so forth.” We hear so much of the increased rate of crushing at the mines. To this fact must still be added the problem of our marginal mines. A factor which is of real concern is that there are certain mines in the country which have fairly large low-grade ore reserves. Here I am thinking particularly of a mine like Crown Mines, which was in its day a rich mine, a mine which made large profits, which paid good dividends and which to-day has large reserves of low-grade ore which is of such a nature that that mine is struggling to maintain its profit margin. Mr. Speaker, is this not perhaps due to the fact that in their eagerness to show large profits, the mines are skimming off the cream? I do not want to elaborate on this point any further because it is an obvious fact that if large capital investments are made to expose the gold, it is in the interests of the economy of the country as a whole for every ounce of gold in the earth to be mined and for the life of such mine to be prolonged. This, of course, within the limits of payability. This must result in the maximum amount of benefit to the economy of the country as a whole. That is why I wonder whether the time has not come when the Government should apply a financial policy in respect of gold mining companies, the aim of which will be, as a mine manager once said to me: “To prevent the evil of picking the eyes out.” We must prevent the skimming off of the cream, leaving the skimmed milk behind. I know that this suggestion has many implications. It can affect our foreign exchange position; it can affect our investments; it can affect free enterprise, but, on the other hand, it is not a sensible thing to mine the gold of the country at such a swift rate and to sell it at a price which may possibly soon be increased. Should some sort of removal policy not be followed? I mean, should the gold mines not be forced by a financial policy to crush the rich ore together with the low-grade ore? I know that this may result in low profits for the mines, but mining will, nevertheless, remain profitable. A policy of this nature will prolong the life of the mine. But once the mine has been worked out, we will be sure that every ounce of gold has been taken from that mine. I believe that the gold assets of the country must be utilized for as long as possible. The aim of this Government must be to develop the economic resources of this country to such an extent that a sound balance is maintained in the economy of the country. If we permit one of the cornerstones of our economy to be gambled with, as I maintain is happening at the moment, in that only the rich ore is being mined, it may possibly lead to economic chaos. The gold mining industry is one of the anchors of our economy, and we must keep it in operation as long as we possibly can.

I want to conclude by saying that I believe that this Budget is based on a sound financial policy. What I have suggested here is within the framework of the sound financial policy of this Government. That policy makes provision for all the requirements of the country and, in its struggle against inflation, it may perhaps be desirable to apply the brake as far as undertakings are concerned which will in the long run benefit from a judiciously decelerated rate of development. This will ensure for us a balanced development in the economic structure of the country.

I am sorry the hon. member for Standerton (Dr. Coertze) is not in the House. We have had two speeches so far on gold mining, one of which was really an interruption expressing a view, and we have just had a very fine speech by the hon. member for Welkom (Mr. van Wyk). I did not think very much of his introduction to his speech. I think he improved as he went along, as good wine improves with age. He spoke about healthy relations between South Africa and the rest of the world. I wish it were true; it is a consummation devoutly to be wished. Not very long ago a leading Nationalist paper spoke about us possibly becoming the polecat among the nations of the world. That is an expression the Nationalists used themselves. If the hon. member were to spend some time overseas he would realize what the reaction to South Africa is. They don’t like us. There is no country in the world that likes us. I agree about that as much as he does and I have done my best to correct it. I go overseas occasionally. We should do something more as a Government to correct it. The hon. member spoke about the two Africas. They were not speaking about the Republic of South Africa only, but about Africa generally. That came from New York. The hon. member said we must create a new image. That is very necessary but how can you create a new image of South Africa overseas when you say to people “If you have a brown skin you cannot go to a soccer match?” That is our problem when we go overseas.

Rubbish!

It is rubbish; I quite agree. That is the trouble we are confronted with, Sir, when we go overseas. The expression has become popular to-day: “There is such a thing as human dignity; the dignity of the individual.” Because we are confronted with that and because of these ridiculous acts on the part of this Government it is hard to explain South Africa. I have tried to explain South Africa overseas; I have done my best. I shall do more if necessary. I have offered in debates in this House to go overseas on tour or on T.V. or whatever they wish to try to improve the image of South Africa. That is what we are all trying to do but the Government makes it so difficult.

I don’t think you will look so attractive on T.V.

But they can improve me with a little make-up. I think even the hon. member for Heilbron (Mr. Froneman) could be improved.

I should like the hon. member for Welkom to give very serious thought to the position of South Africa overseas before he tells us that we are misunderstood. When he came to gold production he obviously spoke with knowledge and with some authority if I am to judge from the position he holds in his party. He paid a very fine tribute to the industry. He paid tribute to what the gold mining industry has meant to South Africa. Of course he did not refer to the fact that the hon. the Minister of Posts and Telegraphs had even advocated the nationalization of the gold mining industry in this House. There seems to be a new appeal from the other side. We have had the other view put forward in this House. We have a much better system than nationalization in South Africa. We have the lease system which the hon. member for Welkom will agree is superior to Government ownership. Because with a lease the Government only comes in when the venture is a success. They do not advance the capital but they take the profits only when mining is a success. They never lose money when a mine is a failure. They don’t come in on the low-grade mine that does not pay but only on the mine that does pay. It is a very fine system.

I am hoping the hon. member for Krugersdorp (Mr. M. J. van den Berg) will also take part in this debate because I think there is a great deal to be said. The hon. member for Welkom also referred to the necessity for doing something about the low-grade mines. I think the Government has tried to do something but there is a limit to what can be done as the hon. the Minister told us last year in his Budget speech. The hon. member for Welkom suggests that the mining policy of the mining companies is not a good policy. I don’t agree with that. All the hon. member has to do is to look at the gold reserves of any mine. If they are mining higher than their gold reserves then I can understand his argument. Then they would perhaps be picking the eyes out of the mine. But they don’t pick the eyes out of a mine today. On the contrary, the big mining groups are anxious to develop the mines for as long as possible. They are following the very policy the hon. member is advocating.

I want to say this. After talking about the mines and discussing mining policy I think there is no improvement that we can suggest as laymen to the policies being carried out by the mining companies on the Witwatersrand where the methods in mining are recognized throughout the world as the most efficient in the world. If there are better mining men in the world this industry will employ them. We are anxious to get them. I don’t think there should be any brake on mining. I think mining for gold will still continue for generations in South Africa. I think the hon. member for Welkom forgot a most important point in his speech, if he will allow me. It was the point referred to by the hon. member for Port Elizabeth (South Africa) (Mr. Plewman) namely, mining taxation. This is a budget debate,. The hon. member could have broken a lance for the mining industry, not only for the owners but for the workers as well. The gold mining taxation system in this country is grossly inequitable and has been recognized as inequitable for a very long time. The hon. Minister has given us his formula. I think it is Y = 60 - 360/x, as it appears in his taxation proposals this year. But it is not the amount of the formula that is wrong; it is the system of applying a differential and discriminatory system of taxation to the gold-mining industry. It is referred to every year. Hon. members shake their heads, but let me quote with authority. I quote from the report of the Social and Economic Planning Council on the economic aspects of the gold-mining industry. It is an old report, but is still a good report, and this is what they have to say in discussing the gold-mining industry in South Africa, just at the time when this Government came into office. I should explain that they are referring to a commission that gave us the present system of gold-mining taxation. That commission was not appointed by this Government. When I speak of gold-mining taxation. I am quite prepared to admit that the United Party and the Nationalist Party and every party we have had in South Africa has behaved in the same discriminatory fashion. I make no exceptions. There was a commission appointed. They called it a commission, but it was really a departmental committee, and on this departmental committee they had the Secretary for Finance, they had the Commissioner for Inland Revenue, they had the Government Mining Engineer and they had other experts from inside the Department. They gave us in South Africa the present formula system which differs from the form of taxation for any other company. When they introduced that system of taxation they thought the gold-mining industry should be treated differently because they used the old argument of the patrimony of South Africa. They said: The gold in the ground belongs to the people of the country. Of course it does. It belongs to the nation. It is a national asset. On that we are all agreed. And they said: “When they have finished mining. all that is left is a hole in the ground.” It is the hole-in-the-ground theory. We agree with that. As gold was mined in California and California was developed subsequently on the wealth of gold, so in South Africa the same thing is happening. We agree with that. But the Government’s lease system provides that the gold that is taken out of the ground is paying its share to the Government. Before a licence for gold-mining can be obtained, a lease has to be approved. That lease provides for the Government’s share, and it is a very considerable share. The hon. member for Standerton interrupted my friend here when he said that something should be done about the taxation of the gold-mining industry by saying “Should they not pay anything?”. Let me tell the hon. member what one company paid. I will not mention its name.

Don’t forget the many concessions.

Concessions are necessary for the low-grade mines. They are not so necessary for the rich mines. The mine I am referring to is a good mine, and the chairman at the annual meeting said this—

Not 30 per cent, not 50 per cent, but 72 per cent of the profits went to the Government.

The old story.

The hon. member should support me when I am striking a blow for the gold-mining industry. The hon. member has not learned anything yet. Hon. members there never seem to learn.

Why don’t you offer an alternative method of taxation.

I am prepared to do that. I thank the hon. member for Ventersdorp for his interjection. As a representative of a gold-mining area he is interested in this. I want to give the alternative. The alternative suggestion by the Social and Economic Planning Council was this—

There is the danger that the high discriminatory tax rates may discourage investment in gold-mining and prejudice new development. These considerations reinforce the council’s recommendation in its seventh report that the income-tax on gold-mining be progressively revised so as eventually to bring into line with tax on the income of other public companies.

I am not suggesting that gold-mining taxation should be the same as the taxation on industries or on commerce, but I think that recommendation on policy should have been followed up. This report was printed when the present Government came into office. Gradually there should have been a movement towards making gold-mining taxation similar to the taxation on other companies. That has not been done and the difficulties it has brought with it are very important ones. We have had suggestions in regard to taxation in this Budget. One of the suggestions is that there should be a levy on individuals; It is not really a tax, it is a loan; I do not quarrel with that; if the hon. the Minister feels that he has to have a levy, I think he should be allowed one. But then I do not think he should say as in Kathleen Mavourneen: “It may be for years, and it may be for ever”. I think he should give a period. Five years is a reasonable period. He should not say definitely that he has not made up his mind how long he will keep our money. A lot of people will be dead by the time they get it back. Their estates might get it back. I do not think that is reasonable. But that is not the important point.

I come to this question of the 5 per cent levy on companies, and the 5 per cent taxation of companies. I should like to read the Minister’s justification for this. He said—

Where is the fallacy there? The fallacy is this, that the Minister, in imposing this taxation, does not act as intelligently as he did in the case of the individual, in regard to the loan levy. He says he will tax the company. Now a company is an association of individuals, of shareholders. There are millionaires who have shares in a company and there are men who depend for their income on the dividends they receive from that company. Some of them have incomes of under R1,000 a year. Hon. members who come from the Rand will know that in the old days men invested their money in gold mining shares and in their old age they lived on the dividends they received. That was their sole source of income, men who prided themselves on saying that they hoped they would never need an old-age pension. Now. when the hon. the Minister increases the taxation on the profits of a company, he is also increasing the taxation on those individuals. Every individual is being taxed in the same way. The Income Tax Commission, under the chairmanship of that great South African, the late Mr. Raymond Steyn, said they would like to consider reforming our system of income tax in South Africa and to bring it more into line with the system that has been adopted in the United Kingdom, where a shareholder receives credit for the profits tax that has been taken from the company. But they could not do it because there was a different system of taxation for industrial and commercial companies, as compared with gold mining companies. Subsequently the Viljoen Commission approached the same problem, and they also found they could do nothing. Therefore I would suggest that the Minister consider appointing a Commission to advise him on how the taxation system of gold mines can be brought more into line with the taxation of other companies. I am not pleading for lower taxation for them; I am objecting to the system and I wish the hon. the Minister would take that into consideration.

Now the Minister says we must save for prosperity. Well, I am very glad to have the opportunity of repeating what I said here on a previous occasion. Why not introduce a savings system which is rather better than those we have, a premium bond system? When I put that forward as a private member’s motion, hon. members opposite said it was gambling. But they will not say that now after the debate we have had on the Gambling Bill, because that debate exposed the fact that in the Transvaal the Nationalist Party Administration is going to introduce totalisators. I do not want to discuss a Bill that is still before the House, but I think the Minister of Finance should get together with the Minister of Justice, who has a broader outlook on the subject of gambling. [Laughter.] He has already played bingo. [Interjection.] Well, it is better to have loved and lost than never to have loved at all.

Not in politics.

When we discussed premium bonds, we had by coincidence in this country Viscount Mackintosh, who is Chairman of the Thrift Committee—not the Gambling Committee—of Britain. He said they had the Post Office savings bank and they had thrift certificates, but the best line was premium bonds. He said: If you intend introducing bonds in South Africa, I would gladly come out and give you my assistance. Well, I give that suggestion to the hon. the Minister.

Then I come to the suggestion that married women will have the opportunity of going into industry where we can use their skills even when they are married. Why we have waited so long I do not know. Every other country in the world has been making use of married women in industry and in the professions. We said in South Africa that if a woman has been trained for three or four years to be a teacher, she cannot teach when she gets married. She can come back later in an inferior capacity, but she has to leave the Service when she gets married. Overseas, in Germany and the U.K. and America, they encourage married women to come back to teach again, because when they are mature they are even better teachers than they were before. There is not only a manpower shortage. We speak of a woman-power shortage as well in the Transvaal. I should like to mention what the hon. member for Pretoria (Central) (Mr. van den Heever) raised. He said he would like to bring the margin down from R8,000 and he had in mind a ceiling of something like R6,000. We are not here considering the question of assisting people by reducing taxation; we are considering a principle, and if that principle is good enough for a man with an income of R4,000 or R5,000, it is good enough for any income. I think the hon. the Minister should consider that. We are not introducing this system in order to assist only the poorer people. We are introducing it to assist, for example, the woman who is a doctor and who marries a doctor. We want to encourage her to go back and practise her profession. It is the principle that we are discussing.

Sir, I am very glad that the hon. the Minister of Economic Affairs is here. I see he is arranging to dispose of the assets of Klipfontein Organic Products to a consortium of companies. Is that the intention? Sir, I approve of that. I think the sooner we dispose of assets of that kind to private enterprise the better. The only question to be considered is how it is to be done. I think that is a matter we should consider. I think we should pursue this policy of the hon. the Minister of Economic Affairs. When the I.D.C. was established, it was established to assist small, struggling companies to get on to their feet and to advance capital to them in the early stages either as equity, or preference shares, or as loans. I think the time has arrived when the hon. the Minister should consider disposing of some of the assets of the I.D.C. to private enterprise. I think that might assist the hon. the Minister of Finance in his budgeting. It has been suggested by a former chairman of the Federated Chamber of Industries; they are very anxious to move in that direction. I think this is a step worth considering. I do not know whether the hon. the Minister has given it any consideration. I can quite see the use of the I.D.C. at present as a channel by which Government enterprise can be applied, but where the I.D.C. has interests in private companies I think we should consider disposing of them. What I do not approve of is the I.D.C. coming into the market to do what my hon. friend, the member for Krugersdorp (Mr. M. J. van den Berg) referred to the other day when he objected to one company swallowing another. Here we had the I.D.C. coming into the shoewear market to try to buy up Cuthberts with public money. I think this is very much worse than the example that was put to him about the big publishing companies of the hon. the Prime Minister and the Minister of Posts and Telegraphs. Here our own I.D.C. under the name of Bonavel, comes into the market and competes with other concerns to buy up Cuthberts. Sir, that was never the intention in establishing the I.D.C. I think the hon. the Minister of Economic Affairs should discourage this.

Now, Sir, just one word before I close on a subject which I raised with the Minister last year, the question of blocked rands. I think the Minister should say “Boldness be my friend”, in this matter. After all, why make such a small amount available for this purpose? These people overseas do not wish to have at low interest or no interest a South African investment for five years. Let some of them take their money out. Surely we are strong enough not to have to worry about the small amount that will go out in blocked rands. I am not speaking of the money that comes out here for share dealing. The hon. the Minister has share dealings in his mind, but there are many other capital realizations which are not share dealings. I think he should consider capital realizations which are not share dealings. I think he can go further, because, according to the figures he gave me in reply to a question, South Africa is actually buying money because in one case they paid over 100 per cent to obtain 100 in five years’ time. Well, that makes our credit look bad! The primary object of the Minister of Finance is to create credit and confidence throughout the world. Sir, we have confidence in South Africa. We all have confidence in South Africa; that is why we invest our money here. We do not have confidence in the Government, but that is a different story. We have confidence in this country, and we have shown in the past that we have faith and confidence in the future of South Africa. I think the hon. the Minister should be prepared to allow a bit more to go out to these people overseas. I think he could ration this money instead of saying: “I am making a floor price of 90.” He can say: “We are going to ration it; we are going to make a floor price of about 85 or 82, and with that floor price you can have a loan for five years at, say, 4 per cent.” I make that suggestion to the hon. the Minister for his sympathetic consideration.

The hon. member for Kensington (Mr. Moore) has always impressed me in this House as an excellent actor. This afternoon he again conformed to that picture I had of him, and I still believe that, even in this year in which United Party members are so fast losing their seats, a very good, new occupation is open to that hon. member—if he should lose his seat—in the fast-expanding film industry of our country. Particularly under the guidance of the dynamic Jamie Uys, he may perhaps still make a great name for himself as South Africa’s greatest actor. But the hon. member’s facts are not always quite correct. I should like to refer to a few of the remarks made by the hon. member.

The hon. member started his speech by saying that “people overseas do not like us”. Yes, there are, of course, people overseas who do not like us. To tell the truth, there are very many people in this country who do not like the United Party either. But it is not all the people overseas who do not like us, just as it is not all the people in South Africa who do not like the United Party. I think there are more people overseas who like us than there are people in South Africa who like the United Party Sir, I also went overseas recently, and I had the privilege of talking to many people in Europe, many Europeans and also many Americans whom I happened to meet there, and I just want to give the hon. member the assurance that there are many people overseas who do like us, and who realize that we have a very promising future. In fact, if that were not the case, why are we getting 40,000 immigrants a year? If those people do not like us, why do they come here? Why do they abandon their people and their country in order to start new careers here? Why should they do so if they do not like us? I respect the hon. member for the manner in which he states his case, but I think we should place a question mark after his facts.

The hon. member also spoke about the I.D.C., which enters spheres which, he says, it should rather not enter. He again made the suggestion that the I.D.C. should make available to the public some of its shares. Is that what the hon. member said?

Certain companies.

Is that not precisely what has already happened? Did not the I.D.C. two years ago establish Industrial Selections precisely for the purpose of making available certain of its shares to the general public? Is the hon. member once again just a little bit behind the times? That is just precisely what the present policy is. Or is the hon. member so interested in those gold mines that he sometimes fails to see these other important aspects? I know the hon. member is very interested in the Stock Exchange. I understand he was even at one stage chairman of the board of the Exchange. The hon. member should not, as has been the case ever since he has been here, just concern himself with gold. A great deal is being done in other spheres. What he asks for is already being done.

The hon. member also had a lot to say about “blocked rands”. Let me now tell the hon. member this—I think he is aware of it, but, as a good actor, he remains silent about certain things so as to let the emphasis fall on other things. The big problem at the moment with overseas financiers is exactly that they cannot get blocked rands. There is no abundance of them. There is, in float, at the moment a tremendous shortage of blocked rands, with the result that overseas investors are unable to obtain sufficient for certain investments which they want to make in Johannesburg. Does the hon. member not agree?

I would be able to get some for you.

I want to return to the amendment of the Opposition, and I particularly want to refer to paragraphs (b) and (c) therein—

1. (b) to enable average citizens to meet the increasing cost of living and obtain their rightful share of the benefit of economic expansion; and
2. (c) to give more adequate assistance to the neediest class of pensioners.

That is exactly in accordance with the pattern of the Opposition in several past Budget debates. The Opposition is merely repeating once more the old parrot-cry about the Government’s lack of sympathy for the ordinary man in the street. Mr. Speaker, were it not such a serious matter, we would not have paid any attention to it. It is really a most irresponsible proposition to make. Surely it is exceedingly irresponsible to say that the Government has no sympathy for the ordinary citizen? The hon. member for Port Elizabeth (South) and the hon. member for Kensington, who has just resumed his seat, had a great deal to say about the reduction in gold mining taxation. On the other hand, they plead for greater concessions to the ordinary man in the street. Now I ask you, Mr. Speaker: Where is the money supposed to come from? The hon. member for Parktown also had a lot to say about the R 16,000,000 which, by means of the 5 per cent surcharge on companies, except gold mining companies, will now come from the pockets of those companies. Where must the hon. Minister of Finance obtain the money for making these great concessions to the ordinary man in the street which the Opposition pleads for? The hon. member for Constantia spoke in a Press statement about the tax concession of R 14,500,000 and the new taxation, as against that, of R 17,800,000. He calls it “a neat example of robbing Peter to pay Paul”. But is Paul not then just the man in the street? Is he not the ordinary man? The hon. the Minister of Finance is now taking the R 16,000,000 out of the pockets of companies which can well afford it in order to make a concession to the ordinary man in the street, the pensioner with the lowest income who is finding things so difficult. How does one reconcile these arguments of hon. members on the opposite side? On the one hand they plead for the man in the street. The hon. member for Pinetown (Mr. Hopewell) said: “We are the party which looks after the ordinary man, the ordinary worker, the ordinary housewife; we are the party which wants to look after their interests.” Where must the money come from if it is not to come from the pockets of the companies which can afford it?

Business interrupted in accordance with Standing Order No. 23 and debate adjourned.