House of Assembly: Vol14 - MONDAY 9 FEBRUARY 1987
announced that he had called a joint sitting of the three Houses of Parliament for Wednesday, 11 February, at 14h15 and Thursday, 12 February, at 14h15 for the delivering of Second Reading speeches on certain bills.
The Joint Sitting rose at 14h59.
The House met at 15h12.
as Chairman, presented the Report, 1986, of the Select Committee on the Electoral Act, dated 20 November 1986, as follows:
as Chairman, presented the Sixth Report of the Standing Select Committee on Communications and Public Works, dated 3 February 1987, as follows:
as Chairman, presented the Tenth Report, 1986, of the Standing Select Committee on Finance, dated 4 February 1987, as follows:
Mr Chairman, I move the motion printed on the Order Paper in my name, as follows:
- (1) Wednesday, 11 February: 14h15 to 18h30.
- (2) Wednesday, 18 February: 14h15 to 18h30; and 20h00 to 22h30.
- (3) Friday, 20 February: 10h00 to 12h45; and 14h15 to 17h30.
Agreed to.
Introductory speech as delivered at Joint Sitting on 9 February.
Mr Speaker, I move:
Hon members know from experience that normally the Appropriation Act is only promulgated by the middle of July. As a result of the general election for members of the House of Assembly, that has been announced, provision has to be made for the fact that the Act concerned, for the 1987-88 financial year, can only be promulgated by the end of 1987. In the meantime, however, one must enable departments to meet their financial obligations with regard to previously approved services from the beginning of the new financial year, on 1 April, to the date of the promulgation of the Appropriation Act. This expenditure must customarily be authorised now by means of a part appropriation.
History is being made today with the submission of this Part Appropriation. As hon members are aware, the four provinces will, as from 1 April 1987, be included in the provisions of the Exchequer and Audit Act, 1975, and the expenditure of these governmental institutions will have to be appropriated by way of an Act of Parliament. This entails that funds have to be voted for each of the four provinces in the Part Appropriation Act to enable them to continue their activities.
The Bill which has now been submitted to you, therefore makes provision for the expenditure that has to be incurred by the central state service and the four provinces in the aforesaid period. It is estimated that an amount of R29,1 billion, made up as follows, will be sufficient to cover expenditure until as late as the end of November: General Affairs Departments, R17,88 billion; Administrations for Own Affairs, R6,12 billion; Transvaal Provincial Administration, R2,1 billion; Natal Provincial Administration, R0,8 billion; Free State Provincial Administration, R0,6 billion and Provincial Administration of the Cape, R1,6 billion. The total is R29,10 billion.
Hon members will recall that I indicated last year that considerable progress had been made with negotiations in regard to formulae in accordance with which the Administrations for Own Affairs would be funded in future. The proposed legislation has already been submitted to the Government Law Advisers, but it will only be possible to pilot it through Parliament at a later stage. Consequently, as happened last year, we shall again have to vote funds in the Appropriation for 1987-88 to the three Administrations for Own Affairs in terms of sections 84(b) and (c) of the Constitution.
As regards the Central Government, including the Administrations for Own Affairs, the sum of R24 billion now being submitted to Parliament for the purpose of approval is R13,9 billion more than the R10,1 billion which was appropriated in the 1986 Part Appropriation Act. This year’s Part Appropriation, however, covers a far longer period than that of last year and it goes without saying that no comparisons can be made or any deductions drawn in respect of the possible course of the various amounts in the Main Budget.
Because the Main Budget will only be delivered later this year, it is appropriate to provide Parliament with a rather more comprehensive survey of the state of the economy than would normally be the case, and to make certain proposals on the basis of that review.
At the outset it is necessary to make a few observations on structural problems and long-term adjustments in the economy. Firstly, various difficult economic adjustments have been forced upon us in recent years as a result of external factors over which we had no control.
As in the case of most developing countries the South African economy has since 1973 been adversely affected by certain basic international economic developments. These include the levelling off of world production after the sharp oil price increases of the ‘seventies. After total world production had increased on average by 6% per annum during the decade prior to 1973, it increased at an average annual rate of only 2% during the ensuing ten years. This contributed to a decline in South Africa’s ratio of exports to gross domestic product, and to a weakening in its terms of trade.
There was also a shift in world economic growth from industries dependent mainly on raw materials to high technology and service industries. In addition the success achieved in recent years by the main industrial countries in combating inflation led at one stage to a decrease in the demand for “hedge” assets such as gold, platinum and diamonds. These developments were all harmful to the South African economy and its long-term growth prospects, and required considerable adjustment.
A further important external development to which the South African economy has had to adjust in recent years was the major fluctuations in the gold price and climatic conditions. The sharp increase in the gold price between 1977 and 1980 also coincided with good rains and record crops and interrupted the long-term downward trend in the growth rate temporarily and in that way ensured South Africa of a number of good years. The consequent combination of a sharply declining gold price and a crippling drought dealt the South African economy a serious blow.
Another development which called for economic adjustment was the large-scale capital outflow which has been occurring since 1984. This outflow assumed various forms, including repayments of foreign trade credits and other loans, and was partially related to a deterioration in overseas perceptions of the economic situation in South Africa. Secondly, negative political views on South Africa contributed to the introduction of mandatory sanctions and disinvestment measures.
Finally, it can also be attributed to an importance change in the attitude of the international banking community towards investment in developing countries in general. In its Annual Report for 1986 the International Monetary Fund indicated that the net loans by banks—this represents the most general source of funds on commercial terms for developing countries had declined from 51 billion dollars in 1982 and 14 billion dollars in 1984 to only 3 billion dollars in 1985.
In a new study on international capital markets which was released in December 1986, the IMF estimated that the developing countries, as a group, had to pay back a net amount of 7 billion dollars to the international banking community during the first half of 1986.
South Africa is therefore not the only country which is under pressure to redeem a portion of its outstanding obligations to foreign banks. South Africa is unique in so far as its relationship with the IMF is concerned. Apart from the fact that we cannot obtain any financial assistance from the IMF in this difficult situation, we are also required to make considerable repayments on existing aid loans to the IMF. As a result of this it is far more difficult for South Africa than for other countries to meet its international obligations.
Against this background we shall take a brief look at the present state of the economy.
Despite the many problems facing us, the South African economy has since about mid-1985 been in the upward phase of the business cycle. This revival began from a low base and was intially slow. At one stage, in the first half of 1986, it almost petered out, but since mid-1986 it has gradually built up steam, to achieve a real growth rate of about one per cent for the 1986 calendar year.
This is hardly an achievement we can be proud of, particularly in the light of our population growth, but in the present difficult circumstances it is certainly not to be despised.
Some sectors are naturally faring better than others: Mining and other export sectors have for some time enjoyed a strong recovery, while industrial production and wholesale and retail sales have in general moved upwards. Agricultural prospects have improved significantly following the good rains in several regions. But building and construction, the motor industry, and steel and engineering remain depressed.
All in all, the economy is however now clearly in a modest recovery phase, and the recovery will gather momentum if given a slight push. This moderate recovery in the production sectors has been reinforced by a slight improvement in domestic demand. Provisional estimates show that real gross domestic expenditure, which fell by over 8% in 1985, was little changed for 1986. However, its performance in the second half in 1986 was better than in the first, which too indicates a continued mild recovery in the economy.
Real private consumption expenditure, in particular, showed a marked increase in the second half in 1986, while real fixed investment by public authorities trended upwards in the fourth quarter. Aggregate fixed investment was still falling sharply in the first half of 1986 but has since shown only a slight further fall, which was also an encouraging trend.
Despite the slight improvements in production and consumption trends, which really manifested themselves only in the second half of last year, unemployment still remains high. As is well known, however, the Government took various steps during the past year to alleviate this problem.
Another problem area is the continuing high rate of inflation. The consumer price index, in fact, rose from 16,2% for 1985 to 18,6% for 1986. I shall return to this question later.
Against the background of the comparatively low real expenditure in the economy, demand for bank credit remained low. The total credit advanced by the bank sector to the private sector is estimated to have risen over the year by less than 5 per cent, appreciably below the inflation rate. At the same time, interest rates fell sharply. The prime overdraft rate fell from 25% at the beginning of 1985 to 16,5% at the beginning of 1986, and is now 12,5%. As a result, in particular, of the small increase in credit advanced by the banks, the money supply grew in 1986 at a much lower rate than that provided for in the Reserve Bank monetary targets for the broad money supply (M3). Although these targets were set at 16 and 20% at the beginning of 1986, M3 grew in 1986 by only some 10%.
Despite severe pressures from abroad, the country’s balance of payments showed some remarkable results over the past two years. The current account continues to show a large surplus. In 1985 the surplus amounted to R5,9 billion. This surplus was attained partly because of the decline in total demand in the domestic economy which kept imports at a low level. Final figures for 1986 are not yet available, but present indications are that the surplus on current account amounted to more than R7 billion. The trade surplus, ie the difference between visible exports and imports, amounted to nearly R15 billion in 1986.
This large current account surplus enabled both private enterprises and public sector institutions to continue to reduce their foreign liabilities on a substantial scale in 1986. This reduction included repayments to the IMF of R801 million, substantial repayments by the Reserve Bank and other banks of short-term foreign credits, and repayments on maturing bearer bonds and notes. Since the end of 1984, the South African economy has repaid well over $3 billion of its foreign debt.
The Reserve Bank’s gross gold and foreign exchange reserves recovered from a low of R3,2 billion at the end of April 1986 to R4,5 billion at the end of December 1986 which was the same as at the end of 1985. During January 1987 the Reserve Bank’s gold and foreign exchange reserves increased by a further R1 000 million to a total of about R5,5 billion. If to this are added the foreign exchange reserves held by the rest of the banking sector, South Africa’s total gold and other foreign reserves currently amount to about R6 billion. This is equivalent to 2,5 months’ imports, which can be considered as reasonable, although not sufficient for a relatively small country such as South Africa in the volatile international environment of floating exchange rates.
The rate of exchange of the commercial rand expressed in US dollars has appreciated from a low point of 36 American cents on 12 June 1986 to its present level of around 48 American cents. This represents an appreciation of 35% against the dollar and almost 30% against a representative basket of currencies. However, even at this higher level the rand continues to be conducive to increased domestic economic activity via export promotion and import substitution.
From all of this the conclusion must be drawn that the South African economy is at present better geared for further growth than it has been for the past few years.
Turning now to our strategy relating more particularly to the domestic economy, I would remark that our monetary policy has involved a sharp fall in short-term interest rates, to the extent indeed that in real terms they are now for the time being markedly negative. At the same time, the Reserve Bank’s open-market operations and rediscount policy were aimed at allowing an increase in the overall liquidity of the banking system. By the end of the year the discount houses needed very little accommodation from the Reserve Bank.
On the fiscal front a modest degree of stimulus was given via the Budget for 1986-87 and the subsequent package announced in June, which have sought via a combination of supply-side measures and social expenditures to boost aggregate demand in the shape of consumption and investment alike.
As to social expenditure, I am pleased to be able to say that the Government has increased significantly its levels of spending on the physical and social infrastructure, both to bring relief to those urgently needing it and at the same time to boost aggregate demand directly, in addition to what is being achieved via the slower processes of supply-side economics. In this connection I wish to draw special attention to the recently formed Housing Trust, which is an encouraging example of the public and the private sector co-operating towards alleviating the pressing problem of housing for the less privileged of our people. To this new body, as hon members may recall, we allocated R400 million of the funds made available for housing in the June package, and we confidently expect at least double that sum to be invested in the Trust, by institutional investors in the private sector.
I also wish to emphasise the ongoing programme of training, job creation and unemployment relief, which has made substantial progress and for which funds will again be available as an approved service from the amoung Parliament will vote via this Part Appropriation Bill.
As far as the stimulatory aspect of these several measures is concerned, we are fully aware of the potential dangers inherent in a consumer-led recovery when inflation is as high as 18%. But our view is that some stimulation of the economy is fully warranted in the light of a large measure of surplus production capacity now existing, the sluggish demand for bank credit, the high level of unemployment that regrettably still exists, and the fact that wages and salaries have recently increased at a lower level than the rate of inflation. It should also be pointed out that the targets that were set early in 1986 for the rate of increase in the money supply, while deemed sufficient to finance the developing upturn, were not such as to accommodate new demand-led inflationary pressures.
So much then for our short-term policy. But, aware as we must be of the fragility of consumption-led recoveries, we are seeking to promote longer-term growth chiefly by way of the creation of greater scope for the private sector to play its crucial role as creator of work, income and wealth. This we are doing through measures directed at privatisation and deregulation of which the White Paper tabled recently on transport policy is a signicant prototype. The announced policy on urbanisation should spur a process of inward industrialisation that will boost the secularly-upward trend of demand for labour-intensive basic goods possessing a small import component.
The long-term strategy is further supplemented by a wider application of the principle of user-charging in the more established sector of the economy, and in general through continuing supply-side actions involving such measures as tax relief, productivity enhancement and work creation. That our efforts in the latter regard have not been without fruit is evident both from the very encouraging results emerging from the special training and job-creation programmes and from the significant progress achieved in the sphere of small business development. We also look for a further upsurge in the informal sector of the economy as the deregulation process gathers momentum. These and other supply-expanding measures which also themselves contain a significant demand element, are fully in line with the recommendations emerging from the long-term strategy developed by the Economic Advisory Council and discussed at the hon the State President’s meeting with business leaders on 7 November last year.
I am far from implying, of course, that we have adequately addressed each and every economic problem confronting us. In particular, the rate of inflation remains at a high level. I do not wish to tire the House with a variety of technical or other reasons for this state of affairs; suffice it to say that our present diagnosis is that we do not have to contend with domestic demand inflation. We shall therefore have to direct our strategy to those other causal elements in the inflation equation that can be identified.
As I mentioned during the no-confidence debate, a top-priority study is now being made, under the aegis of the Department of Finance, of the whole question of inflation and its treatment. At this stage it needs merely to be reiterated that inflation is a complex process and requires a strategy that does not rest on simplistic premises. I wish, however, to reiterate, that we continue to believe in conventional financial disciplines and in a fiscal and monetary policy mix that will not stimulate excess demand. However, we also believe that it would be folly for South Africa in the present situation to depress demand further by unduly restrictive monetary or fiscal policy measures. Neither do we envisage a resort to the direct control of prices or incomes but I must express my unease at the view apparently taking root in some quarters that profit margins need to be “fully restored” before any meaningful relief can be looked for on the score of prices.
I would caution against the unqualified acceptance of a doctrine of this kind. As already mentioned, one of the encouraging signs on the inflation front of late has been the tendency for wages and salaries to increase at a rate below that of inflation. This fact surely serves to underline the ill-advisedness of any implied claim by other factors of production to an inherent right to the maintenance of real income.
To embark on such a course would naturally be to give yet another twist to one of the constituent elements in our inflation, namely a vicious price-cost spiral with*all that this would mean—not only by way of its immediate and predictable repercussions but also for the ultimate survival in our country of the private enterprise system itself. One hardly needs to say that in those circumstances the Government would be unable long to resist a popular cry for direct controls.
On the basis of the results achieved in the South African economy over the past year we can now look forward to further improvements in the period ahead. The real growth rate is rising—albeit at a relatively low rate— and should continue to rise during 1987. The rate of inflation should gradually decline. The current account of the balance of payments should again show a surplus in 1987. The gold and foreign exchange reserves should rise to a more comfortable level.
*As already mentioned, the Government has for some time now been following a strategy of moderate stimulation with a view to economic growth and work creation. The Government also accepted, however, that some time would elapse before the economy was once again buoyant and therefore instituted a special work creation programme during the past three years, to relieve the effects of unemployment and at the same time to promote the expansion of the informal sector.
Given the realities of the South African situation—and more so as we are involved in serious Third World problems such as a significant number of people involved in a subsistence economy, a high rate of population growth, relatively low levels of schooling, low average per capita incomes and above all rapid urbanisation—no one can dispute the necessity of a strategy directed to economic growth and work creation.
In further support of the current policy of moderate stimulation it is necessary at this stage that further adjustments be made in our financial policy. In the present economic climate there are few economists that do not believe that further stimulation to reinforce the upswing is necessary. There is also consensus that sufficient room exists for such stimulation without any danger of excess demand or pressure on prices and the balance of payments.
The Government, too, accepts this viewpoint and has come to the conclusion that measures to that end simply cannot wait until Parliament assembles again later this year. These measures have been agreed upon taking into account the necessity for a higher rate of economic growth so as to create more work opportunities but without placing unnecessary pressure on the current account of the balance of payments or causing further inflationary pressure. By these means it is sought, within the country’s financial constraints, to bring tax and other relief to the widest possible spectrum and thereby also give impetus to the economy on a wide front. I would however emphasise that the proposed tax relief is not in conflict with the spirit of the Margo Commission recommendations. The proposed relief can also be accommodated within what the Government in present circumstances regards as an appropriate financial framework. A full account of the expected course of the State finances for the present financial year will be given during the second reading of the Additional Appropriation Bill later this month, but the framework for the forthcoming financial year will have to stand over until the Main Budget.
General Sales Tax
The Government does not now propose any alteration in General Sales Tax. The Margo Commission has made wide-ranging proposals affecting indirect tax; it is anticipated that the Commission’s Report will not be translated and printed before May, whereupon it will be submitted to the State President. Although preparatory departmental studies have already been launched, it would not be fitting to take any steps now that might restrict the scope for decision when the proposals are later considered by the Government. Furthermore, a reduction of one percentage point in GST would mean a loss of revenue of about R850 million, while it is an open question whether the reduction would in fact significantly be passed on to the consumer. A larger loss of revenue cannot, unfortunately, be considered at this stage.
Public service salary adjustments
It is common knowledge that the Government has received representations over a wide front for the improvement of conditions of service in the public sector. These representations have been made in a thoroughly responsible and fully motivated manner and the Government expresses its appreciation for this approach. The Government would also confirm its sympathetic understanding for the merits of the submissions, and furthermore that it is considering the question against the background inter alia of market factors, increases in living costs, the constraints on the Treasury and the position and needs of the economy as a whole.
On the one hand, the Government appreciates that a decision in this regard should be taken as soon as possible; but, on the other, the remuneration policy of the State is a matter that cannot be properly addressed on an ad hoc basis in a part appropriation. It has therefore been decided that an announcement on this subject will be made when the main Budget is introduced. This also applies to civil pensions.
Social Pensions
It is a sound principle that people should provide for their old age. To that end the Treasury assists by various tax concessions to promote saving, the building up of pensions and so on. Furthermore, the taxpayer makes possible direct transfer payments regarding social pensions and allowances. Although not everyone is always in a position to make adequate provision for their retirement, these direct contributions are regarded as justified in extending a helping hand to those who are dependent on assistance from the authorities.
As a means of relieving to some extent the increasing burden of living costs for this group, I am happy to announce that the Government plans to make R200 million available from 1 October 1987 for improvements in social pensions and allowances. The allocation of this amount will be made by my colleagues administering pensions matters, and the particulars will be announced as soon as possible.
†Assistance to the agricultural sector
Hon members need not be reminded of the serious financial position in which many farmers find themselves today as a result of the protracted drought. In these circumstances the hon the State President requested his Economic Advisory Council to institute a thorough and expert investigation into the problems facing the agricultural sector and to submit to the Government recommendations to assist farmers in overcoming these problems. Their recommendations were referred to the Jacobs Committee to assess the practicability of the proposals.
This task has now been completed and the results submitted to the Government for further consideration, and it affords me much pleasure to announce than an amount of R117 million will be included in the main estimates as the first instalment in a five-year programme for the reconstruction of the agricultural sector in the drought-stricken areas. A further amount of some R120 million will also be made available for various other assistance programmes to the agricultural sector.
Full particulars of the constituent amounts are still to be determined and will be made available at a later stage by the hon the Minister of Agriculture.
Repayment of 1983 loan levy
A measure which will immediately contribute to an increase in personal disposable income is the early repayment of the last amount of loan levy owing to the individual income taxpayers, namely that in respect of the 1983 loan levy. The amount of capital repayable to more than one million taxpayers is R210 million, to which must be added interest of some R77 million. The interest is calculated at a rate of 7,5% a year—simple interest—and is not subject to tax. For people in the higher income brackets this represents an effective rate of interest of almost 15%.
It was hoped that it would be possible to make the repayment by the middle of next month, but this is unfortunately not possible. The Inland Revenue branch of the Department of Finance is presently engaged in addressing more than 2 million 1987 income tax returns and the staff are fully stretched. Repayment cheques will nevertheless be issued not later than 30 March 1987.
I wish to stress that it will not be necessary to go to the financial markets for the requisite funds.
Working wives
The Budget Speech on 17 March 1986 dealt at some length with the income tax problem of the two-breadwinner family. No solution that is both simple and affordable is yet in sight, and the matter of the sometimes substantial balance of tax that is payable on assessment has been only partially relieved as a result of the concession granted last year. That concession, it will be remembered, took the form of a material increase in that portion of the wife’s income not subject to tax.
In order further to alleviate the burden on working wives while at the same time encouraging married women to continue to make their skills available to the economy, it is considered that an increase in the present concession is justified. It is therefore proposed that, in terms of legislation to be introduced later this year, the deduction allowable in terms of section 20A of the Income Tax Act be increased to the greater of R2 250 or 22,5% of the wife’s earnings. Thus, if the wife’s earnings amount to R8 000 a year or less, the first R2 250 will be free of tax. Should her earnings amount to, say, R15 000 a year, the first R3 375 will be free of tax.
The increased deduction will apply in respect of the year of assessment commencing on 1 March 1987. Amended tax deduction tables will be issued as soon as possible, but it is doubtful whether these can come into effect before 1 May 1987. Computer bureaux, which now process the paysheets of more than 90% of all employees, will be authorised, however, to adjust their deduction formulae with effect from 1 March 1987, provided they are able to modify their computer programmes in time.
This particular concession will result in a loss of revenue for the 1987-88 financial year of R95 million.
It should be noted that in respect of the year of assessment ending 28 February 1987 the existing measure of relief will apply. That is that the greater of R1 800 or 20% of the wife’s net earnings will be free of tax.
Savings
The encouragement of personal savings remains a high priority, especially at a time when the personal savings ratio is at a low ebb. Within the means at our disposal we have sought to make saving worthwhile through income tax incentives. Apart from cerain investments in Government stock, the Post Office and building societies, the first R500 of a taxpayer’s interest income (other than that already exempt under the Income Tax Act) is now free of tax.
It is proposed that, in respect of the year of assessment commencing on 1 March 1987, the tax-free amount of interest be doubled to the sum of R1 000 per taxpayer. This additional and very generous concession will result in a loss of revenue during the 1987-88 financial year of no less than R119 million and should raise the effective after tax rate of interest, especially for the smaller investor.
Rate adjustment in respect of individuals
I now wish to deal with a more general concession to individual income-tax payers which will provide some alleviation of the burden of fiscal drag and meet our 1984 commitment that the proceeds from the phasing-in of taxation on fringe benefits would be used for the adjustment of income tax tables. Hon members will recall that in respect of the year of assessment ending 28 February 1987 two substantial concessions were made to individual income tax payers. These were the abolition of the 7% surcharge which had been imposed earlier and the granting, in addition, of a discount of 5%.
The continued increase in the amount of income tax paid by individuals, in spite of the substantial concessions which have been made in recent years, remains a cause for great concern. The collections are not only increasing in absolute terms, but also as a percentage of the total amount of tax collected from all sources. The principal reason for this increase is without doubt fiscal drag.
However, whatever the causes, the problem requires to be addressed within the limited means at our disposal. No country has found a completely satisfactory solution to the problem of fiscal drag—which is, I would emphasize, a problem that affects all personal income tax payers under a progressive tax system—the individual taxpayer finds himself moving inexorably into a higher tax bracket even though his real income does not grow. Such palliatives as there are, involve a substantial sacrifice of revenue and this we regrettably cannot afford at present. Some relief is, however, possible from time to time, and I therefore propose that, for the year of assessment ending on 29 February 1988, a new table of rates will be applied in terms of which the first band of income will be taxed at a rate of 15% instead of the existing 16% and the highest rate will be 45%. The maximum rate will apply to taxable incomes in excess of R60 000 in the case of married persons and R42 000 in the case of unmarried persons. It should perhaps be stressed that the maximum marginal rate of tax has over a period of only two years thus been successively reduced from 53,5% to the proposed 45%.
The new table of rates will bring about a material reduction in the burden borne by payers of income tax. The tax threshold for a married man without children will rise from R5 988 to R6 633, and this will mean that a fair number of individuals will cease to be liable for income tax. The threshold in the case of married persons over the age of 65
years will rise from R9 113 to R9 966, an increase of R853.
The new rates of tax will apply as from 1 March 1987 and will result in a loss of revenue in the 1987-88 financial year of R545 million. Computer bureaux will be given particulars of the new table of rates within the next few days and will be free to apply the reduced deduction as from 1 March. Employers who calculate the tax deductions of employees manually will have to await the new set of tables. It should be stressed that this concession will provide still further benefit to working wives.
A few concluding remarks: It will be apparent to hon members that the Part Appropriation Bill seeks to continue the two-pronged macro-economic strategy the Government has been pursuing for some time now of providing a modest but necessary stimulus via on the one hand supply-side measures embodied in tax relief and on the other hand social expenditures that simultaneously address the more pressing needs of our less-privileged people and boost aggregate demand. In the nature of things the supply-side prong enjoys a high profile today; but I am happy to assure hon members that the second prong comes fully into its own by way of the hinds being allocated to social and physical infrastructure, and more particularly in the fields of housing, schooling, training and work creation. Unspectacular though these expenditures may often seem at the micro-level of everyday economic life, they are playing a vital role in bringing about the fairer distribution of income and opportunity that is a hallmark of a just society.
A final word. At his meeting with business leaders towards the end of last year the hon the State President chose as his theme: “Forward in Confidence!” This may well serve as a rallying cry for the South African economy in 1987.
Second Reading resumed
Mr Chairman, I move the following amendment to the motion of the hon the Minister:
I want to stress the word “blunders”—
One of the interesting things about the hon the Minister of Finance’s address which he delivered only a few moments ago during the joint sitting, was that his own supporters did not exactly greet it with joy or exuberance. There was not a single “hoor, hoor!” during his entire speech. There was nothing to suggest that here was our great financial genius, the one who is leading us out of the morass in which we find ourselves, because the reality is that they all know that, together with his predecessor, he is the man who has got them into the mess they are in and who has got the country into the mess it is in, and therefore there is no great enthusiasm for the hon the Minister. [Interjections.]
What is remarkable is that when one reads what was forecast in relation to the budget, one finds that the hon the Minister has done virtually everything that was predicted. He thinks he has been very smart, but he is underestimating the intelligence of the voters of South Africa. [Interjections.] To the Public Service he says: “Be good boys and vote for me, and you will get your increase after the election.” [Interjections.] Moreover, he has the audacity to say it in so many words. I have never seen such political impudence in all my life as the way he is keeping the public servants on a string.
In exactly the same way the hon the Minister is underestimating the married women of South Africa. I want to give the hon the Minister a bit of news, namely that the women of South Africa, and particularly the married women, cannot be bought. They can be wooed with love but they cannot be bought with money, and that is the mistake he is making. [Interjections.] He thinks that he can win the married women over with a few rand but the married women of South Africa are fed up with the hon the Minister and the Government. They know what he has done to them and to the country, and so he will not be able to buy the married women of South Africa with a few rand. [Interjections.] Let me be fair, however. I am not saying— and I do not want there to be any misunderstanding about this—that the public servants are not entitled to an increase. However, I think that when the inflation rate is running at the level at which the Government has caused it to run in this country, then the pensioners of South Africa should be first in line for relief. I am therefore pleased that there is some relief for them here.
There is nothing wrong with the public servants saying: “Look at the rate of inflation; look at what has taken place.” Certainly the hon the Minister should talk to them about productivity, although I did not hear a single word in his entire speech about productivity. However, the reality is that they are entitled to come forward with their request. The taxpayers are entitled to say that there is bracket creep in South Africa and that they are entitled to relief. That is not my complaint. My complaint is that the budget should be presented as a whole; that one should know what the revenue and expenditure figures are when dealing with the budget; and that the hon the Minister should not come along in this way before the election and, as I correctly forecast, dish out a few sweets to the people and then try to administer the medicine after the election. The public of South Africa are not so stupid. I think that what the hon the Minister has done is immoral.
Let me read to him a passage from a speech made by another Minister of Finance, and the hon the Minister can then tell us who he thinks it was. He said the following (Hansard: Assembly, Vol 47, col 1383):
The then Minister of Finance continued as follows:
Order! While we are dealing with ethics, I wish to point out to the hon member that he said that the hon the Minister had done something “immoral”. The hon member will withdraw that word.
I withdraw it and say the hon the Minister is financially and politically immoral, Sir.
Order! The hon member must withdraw it unconditionally.
I do so, Sir. One is however entitled to say that this is unethical, Sir, because the then Minister of Finance said it was unethical. The interesting thing is that, in those days—in 1974—the NP did not need it. In 1987 the NP does need it, and needs to use these unethical methods in order to try to bluff the voters. [Interjections.] The Minister of Finance I quoted was Dr Diederichs. The hon the Minister of Constitutional Development and Planning is smiling because he remembers those days. He remembers the 1974 election and what took place then.
The reason why the NP needs to use such methods is the theme of what I have to say today. I pose this question to the hon the Minister of Finance: What have he and his party done to our country? What have they done to the economy of South Africa and to the country as a whole? How dare they seek a mandate to continue with the mess in which they have placed the whole country? [Interjections.]
I hear a laugh. I am sure it must have been an hon member. It could not have been a hyena, although it sounded like one.
I would like to quote from two NP supporting newspapers. I read the following remarks referring to the hon the Minister of Law and Order in today’s edition of Beeld:
This is an NP newspaper. It is owned and controlled by these chaps. They run it and it is their mouthpiece. [Interjections.]
You talk a lot of nonsense!
The hon the Minister says I talk a lot of nonsense. [Interjections.] What does Beeld support? How does one become a shareholder of Nasionale Pers? I cannot, as the hon the Minister well knows, because only NP supporters can, so what kind of nonsense is the hon the Minister himself talking? [Interjections.] He knows full well. [Interjections.]
I would like to continue quoting from Beeld, viz:
The writer goes on to deal with insurance and matters of that kind, and then continues:
That is what the NP got South Africa into.
Talking about the hon the Minister, listen to what another newspaper which the hon the Minister of Constitutional Development and Planning will be able to say his party and the Government do not own any more, viz. The Citizen, has to say about him.
I said we do not own newspapers.
That is correct. They do not own it. [Interjections.] He need not protest. They do not own it. [Interjections.]
He can’t say that.
Of course I can say it.
Let the hon the Minister say what he likes. We shall take no notice of him. Let me quote:
That is what newspapers which support the Government are saying about this matter.
Let me deal with another issue, viz. business confidence. I brought the hon the Minister’s Hansard of last February along because this has become a classic piece of how wrong one can be and I am going to keep it on my bookshelf. May I ask him whether he did not say that we were going to have a growth rate of 3%. Right? He was wrong. He concedes that. Secondly, he said that inflation was going to come down. He was wrong. He concedes that as well. So what is he right about? He is right about nothing. He said that business confidence would increase and I can give him the quotations because I have them all here beautifully marked. What has happened, however? This Government has succeeded in destroying the confidence of businessmen in the country. It has succeeded in destroying the confidence of consumers in the country and has succeeded in destroying the confidence of people overseas in this country. Just when we think that we may be coming right despite the fact that the Government is not dealing adequately with politics or with inflation and are not taking the correct policy measures, we see them making what is commmonly known as a “Bols” story of what had been a possibility of an upswing in confidence on the part of the business community.
Order! I do not quite follow what is meant by a “Bols” story. [Interjections.]
Sir, if you have any difficulty in understanding it, the hon member for Pretoria Central and the hon the leader of the CP are experts in that field and they will be able to explain it to you! [Interjections.]
If anything was calculated to do harm to business confidence in South Africa it was what we witnessed here last week. What we should have had today was a statement by the hon the State President at the commencement of procedings expressing his regret about two things. He should have admitted that he had made a mistake about the De Kock story as well as the Ball story. The hon the Minister of Finance should say that if he wants to set the business climate right. They will not do so, however. They did it for political advantage in order to get a few votes and stir up emotions. That is how they are dealing with the economy of the country.
Let met deal with inflation. Here we have a few classic things which I think we should analyse. In the no-confidence debate this hon Minister told us how difficult it was to deal with inflation and paid tribute to Business Day for publishing certain articles. He then proceded to quote selectively—I repeat selectively—from those articles.
There can be no such thing as an unselective quote.
The hon the Minister is a selective quoter.
What he did was to ignore the first of the articles and perhaps the introductory remarks. The article was by Louis Geldenhuys and in dealing with inflation hesitated:
The following are the causes he quoted:
Why did he not quote that? It is true that not all the blame for inflation lies at the feet of the hon the Minister but a very substantial portion of that blame lies at his feet and those of his predecessor who are responsible for the mess in which the country finds itself in regard to a whole series of matters.
Let us now deal with another matter, with the fact that it is quite clear that the disposable income after tax of South Africans has gone down and they have become impoverished—as somebody has said, the middle class of South Africa has become “the impoverished people of South Africa” in addition to the people who were poor before.
We must also look at what the hon the Minister did to the value of our currency. He also had the audacity to say that exchange control had been reimposed for only one reason and that was to stop the loan money from going out through the share market. Every economist in South Africa to whom I have shown that has said it is absolute nonsense because every banker knows that it has been designed in order to stop money from going out both through the stock exchange in respect of equity investments and in respect of disinvestment in regard to equity holdings in South Africa. It is also used in respect of ex-residents and the expatriation of their funds. The Government has therefore also made an unholy mess of exchange control and we could carry on with this litany of mistakes they have made.
I have referred to crime and inflation and I analysed unemployment on a previous occasion. Here we have a classic and quite a remarkable situation. When one looks at the number of economically active persons in South Africa one sees that there are 8 692 363 according to Government statistics—that was according to the 1985 census. However, the actual number of people in employment— excluding agriculture and domestic service— was 4 824 000. Where are the other 4 million approximately? Are they all in domestic service or on the farms? Not on your life! The statistics we have been fed with regard to unemployment are unadulterated garbage! There are well over 2 million people in South Africa unemployed and we keep on being fed statistics which are meaningless. [Interjections.] It is therefore possible to deal with what the Government has done as far as unemployment is concerned. We can also deal with the fact that they only realised at the last moment that we had unrest, politics and economics all combined. We have a whole combination of events all of which have contributed to the mess in which we are in.
I want to give the hon the Minister a few pieces of advice. Firstly I think the hon the State President should be advised to keep out of economic affairs because every time he interferes he does harm to the economy of South Africa and it affects confidence in our country. I think he should stay out of economic debates in this House and outside. In this regard we need to look at the possibility of an enquiry in one of our select committees as to whether we should continue with the merging of the titular head of state and the head of a political party because it just does not work.
The hon the Minister’s one Deputy Minister, the hon member for Amanzimtoti, had the audacity to say that a law had been passed last year while he and everybody else in this House knew that it had never been passed. How does one deal with such an hon Deputy Minister? What does one do with him? Does one repudiate him? [Interjections.] He is the man who speaks on finance and economics.
I want to tell the hon the Minister of Finance that he has one good guy in my opinion and that is the hon Deputy Minister of Finance who is the hon member for Waterkloof. I think he should perhaps make room to let him take over.
This Government has got us into a mess. We have a long list of everything that they have done wrong. What worries us is that they have no way to get us out of the mess again. They are now seeking a mandate to get us into an even bigger mess. However, they underestimate the voters of South Africa if they expect them to give the Government that mandate.
Mr Chairman, I should like to congratulate the hon the Minister of Finance most sincerely on this Part Appropriation. He has succeeded in bringing relief to the social pensioners, retired persons, agriculturists, working married women and other taxpayers. At the same time he has given the economy a R1 billion shot in the arm. He has also succeeded in not making the salaries of public servants a political football in the coming election campaign. We thank him for that. It is a pity that the hon member for Yeoville has already begun doing so. In my opinion it is a well-balanced budget and in no way a fat-cat budget.
I want to quote what the hon member for Yeoville said in his speech during the no-confidence debate. He said:
That is the most irresponsible, unjustified and scandalous personal attack an hon member can make in this House. This afternoon the hon member for Yeoville again did so repeatedly. I think he should be ashamed of himself. I want to give him this good advice: When he has a personal vendetta against someone—and I know he does—he should play the ball and not the man.
We do know the hon member, however. He is an outstanding actor, particularly in the sense that he creates the most fuss when he has no case or a weak case. That is when he makes the greatest fuss or the most snide remarks. We have had examples of that this afternoon and also in the no-confidence debate.
The hon member said, amongst other things, that the hon the State President should keep his nose out of the economy, but I think the hon the State President gave the hon member a good dressing down about the unfounded statements he made about Dr De Kock. The hon member has never appeared in a more pathetic light than when the hon the State President gave him a drubbing. In fact, I almost felt sorry for the hon member.
The hon member is deeply concerned about aspects of security, economic problems, the high inflation rate, unemployment, high taxes and the lack of confidence on the part of consumers and investors. We are all concerned about that, but the hon member neglected to analyse the reasons for this, spell them out and then come to light with possible solutions.
The hon member has already had two opportunities to speak—today and last week—but he has not yet said anything. He has merely come to light with vague generalities such as the following:
Now he comes along today and moves an amendment with exactly the same content. I want to quote it:
That is precisely what he said last week. He said nothing new. Surely that is not the way to conduct a debate. We know the hon member. He can do better.
In this vein other hon members of the Opposition referred to the “hardy annuals” during the no-confidence debate, and in this debate they will also be referring to them again. These include higher Government expenditure, the high rate of unemployment and the higher inflation rate. Although they were vehement in their criticism last week, I am afraid that not one of them, not even the hon member for Yeoville, came to light with concrete proposals for solving these problems. In fact, it was very clear to me that they did not even understand the true causes of some of the problems. How would they have been able to offer solutions?
I should like to make a brief reference to Government expenditure. We see a great deal written in the newspapers about Government expenditure. Government expenditure for the 1986-87 financial year increased by approximately 20%. That is, in fact, considerable in comparison with the increase of 14% proposed in the Appropriation. Together with this, however, one must also consider how current revenue has fared. It is calculated that the target of a 13,1% increase in the Appropriation would be achieved. That means, of course, that economically speaking State finances are and will be more expansive than was initially envisaged. Bearing in mind the poor performance as far as economic growth is concerned, it is clear that this is not necessarily a bad thing, although a case could be made out against a strong increase in Government expenditure. The economy can indeed be stimulated by either increasing Government expenditure or decreasing taxation.
The big question is now what should be done. If an attempt is made to increase demand on the domestic front, this must be done either by way of greater Government expenditure or by lower individual and company taxation.
There is a school of thought advocating higher Government expenditure, in the present circumstances, as the course to adopt. I shall tell hon members why certain people think so. It is argued that it is the best way to ensure that the funds that are voted are, in fact, spent, whilst lower taxation could possibly result in savings leakages. On the other hand there is the apparently acceptable proposal of higher expenditure over a wide spectrum, including capital works, job-creation, the training of labour, drought aid and social crisis relief, and this action on the part of the Government should rather, particularly in the public eye, be endorsed than criticised.
The hon member also referred to inflation. It is, in fact, true that the South African inflation rate is higher than was foreseen until recently. I fear there are no shortcuts to reducing the inflation rate. There is no doubt that South Africa’s present problem of inflation cannot be ascribed to a great excess in demand relative to production. The current account of the balance of payments, in fact, evidences a great surplus. Virtually every where in the economy there is also unutilised production capacity. It is therefore clear that excessive demand is not, at present, the reason for the higher inflation rate.
It is also generally accepted that the high level is not caused by demand inflation. The money supply—M3—has only increased by 10% during the past 12 months, an increase that compares favourably with the target rate of 16% to 20%. Nor was the inflation of the past two years that of a typically push-cost type. A portion of the inflationary spiral, ie wages and salaries, has in fact evidenced a greater increase than the inflation rate, but it has nevertheless increased to a lesser extent than the inflation rate, so that real wages and salaries have decreased appreciably.
So where does the problem lie? This matter is so complex that one hesitates to express an opinion, let alone come to light with a clear-cut answer. By analysing certain factors I do, however, want to put certain matters to hon members. An exceptional combination of negative factors has been responsible for a much more unfavourable inflation rate this year than was foreseen. It is a fact that the increase in the consumer price index during the past year can chiefly be ascribed to the effect of the depreciation of the rand. For completely different reasons, this was caused by an abnormal outflow of capital.
The temporary acceleration of the inflation rate during the latter portion of 1985 and the first few months of 1986 can chiefly be ascribed to the depreciation of the rand from its previous relatively stable level of approximately 50 American cents to 36 American cents during the major portion of the year. In contrast to most other situations in which the exchange rate depreciates, the cause for this particular depreciation could clearly not be found in the excessive creation and expenditure of money. It was brought about, for totally different reasons, as I have said, by an outflow of capital. In these circumstances, a tightening of the monetary policy would have contributed little to eliminating the causes of the depreciation of both the exchange rate and of inflation. It would only have delayed local economic recovery.
If the respective main groups, from which the consumer price index is constituted, are referred to, it becomes apparent that the following groups of products evidenced above-average increases during September 1986: Meat, 30%; fish, 30,6%; vegetables, 24,2%; coffee and tea, 33,4%; soft drinks, 22,5%; domestic fuel and power, 21,9%; domestic cleaning agents, 37,9%; and vehicles, no less than 45,1%.
There is also an interesting pattern discernible in the respective groups of products. These groups of products can be divided into categories in which, time and again, there was a common underlying reason for the above-average increase in the prices of the products. The first group consists of meat, fish and vegetables. In this category the price increases are ascribed to the relative scarcity value of the products. From information gleaned, South Africa’s livestock flocks have been so depleted as a result of the lengthy droughts that the supply to the markets sharply decreased and will probably remain at a low level for a long time yet. The imbalance between supply and demand therefore leads to sharp price increases.
The second group consists of coffee, tea, household appliances and cleaning agents and vehicles. Products in this group are chiefly imported, whether in their final form or in the form of parts or raw materials for their manufacture. To a large extent the price increases of the products in this group can therefore directly be traced to the weakening value of the rand as against that of most other monetary units.
It would nevertheless appear as if one could look forward to the 1987-88 financial year with a greater measure of confidence. There ought to be a slightly lower, though still an unrealistically high, level in the rates. It is unlikely that the demand-pull factors will already be coming to the fore. In addition it is hoped that the cost-push factors, which had a negative effect on the inflation rate last year, will exert a smaller influence this year. In particular, sustained financial discipline is therefore definitely necessary to force the inflation rate down to lower levels.
The present economic situation and the future prospects indicate that in many respects there is no room for a renewed cyclical upswing in the short term and for a considerably higher real average mid-term and long-term growth-rate. I want to advance the following reasons for this: During the past two years the shortfall on the current account of the balance of payments has been converted into a considerable surplus. Considerable amounts in foreign debt have been repaid. The exchange rate of the commercial rand, as against the American dollar, has appreciated from a low of 36 American cents to its present value of approximately 48 American cents. The exchange rate of the commercial rand is still undervalued. The continued prevalence of unemployment and a production capacity surplus indicates that in the future the economy ought to be able to maintain a higher growth rate at an early stage without any impediments. Real salaries and wages have been adjusted downwards; people are living within their means. The orientation of both the monetary and the fiscal policies remains expansionistic, because there is considerable room for an increase in the money supply and the overall demand.
In a situation in which the economy and politics are inextricably interlinked, the needed level of business and consumer confidence has unfortunately not yet been achieved. The hon member for Yeoville has, in fact, referred to that. The incentive to invest and an inclination on the part of consumers is therefore simply not sufficient to set the desired economic upswing in motion. The majority of private businesses and financial undertakings in South Africa are still unwilling to extend their business activities. The reason for this is definitely their uncertainty about South Africa’s mutually interlinked political and economic future. Notwithstanding this, the Government is still giving attention to the official approach to certain matters such as inward industrialisation, export promotion, import replacement, matters involving manpower, rural development, and also the continuation of its programmes for the maintenance of law and order—whatever the hon member for Yeoville might say—including further comprehensive political and constitutional reforms.
That is why the Government has every right to expect the private sector to display more confidence in the future by making full use of the room available in the economy at present for increased investment and production. The potential for rapid economic growth and for an increased standard of living is really very great indeed. The challenge is to prove to ourselves and to countries abroad that we have both the will and the ability to implement short-term monetary and fiscal policy and execute a suitable long-term economic strategy, to maintain law and order in South Africa and to continue with peaceful evolutionary reform. Significant reform on these fronts would contribute greatly to a wonderful future for all of us in this beautiful country.
Mr Chairman, I move as a further amendment:
- (a) to take effective steps to combat inflation and price increases;
- (b) to keep unemployment in check;
- (c) to maintain law and order and effectively to combat uprisings, arson, murder and violence; and
- (d) to render the necessary assistance to certain sectors of agriculture in a meaningful way; and
Mr Chairman …
Why are you going to Wonderboom, oom Jan?
Why am I going to Wonderboom? I am going to Wonderboom to take that seat from an hon Minister who is not straightening out this country’s economy. [Interjections.]
Wonderful, oom Jan! [Interjections.]
Mr Chairman, the hon the Minister of Finance … [Interjections.]
Do you think Wonderboom is a safe seat for you?
Dead right! The hon member asks whether Wonderboom is a safe seat. He is dead right. [Interjections.]
Order!
Mr Chairman, last Monday the hon the Minister of Finance entered the no-confidence debate. I do not should he should ever have done so, because he put up a poor show.
That’s right, oom Jan, let him have it! [Interjections.]
Order!
In the no-confidence debate the hon the Minister asked the hon the Leader of the Official Opposition to say what his vision of South Africa’s future was. He said that people should not destroy things when they do not have anything meaningful with which to replace what they destroy. The hon the Minister himself, however, has not yet done anything meaningful since he became Minister of Finance.
That is right!
Throughout the years we have consistently told him what he should do; what meaningful things there are that should be done. He does not, however, do them. [Interjections.]
Mr Chairman, I think that the single biggest problem in South Africa is the administration of State finances. For years now the State’s financial capabilities have been exceeded. Expenditure is simply increasing too rapidly. If the hon the Minister cannot succeed in curtailing Government expenditure, and things were to get out of hand, he surely could not make tax concessions. Today we saw that it cannot be done.
We do, in fact, express our thanks for the few crumbs that have fallen from the table. I shall say more about this at a later stage.
In recent years Government expenditure has continually increased, also in relation to the amounts originally budgeted for. In the 1980-81 financial year there was an expected 14% increase in Government expenditure. In the long run, however, the actual increase was 18,4%. Let me mention one more. In 1982-83 an increase of 11,5% was projected. In reality the figure overstepped that mark completely and was 17,5%. The hon the Minister did not have any control over expenditure, nor any discipline.
In 1984-85 budgeting was done to cover an increase of 11,7%, but in reality it was 21,8%. No, the hon the Minister did not have any control over his departments. The structure of Government expenditure is up the spout. The hon the Minister said there was too little investment, but he himself is actually the underlying cause.
In 1978 the budgeted percentage for current expenditure was 65% and for capital expenditure 35%, but in 1983 the percentage for current expenditure increased to 86%, whilst that for capital expenditure decreased to 14%. In 1985 the figure was 91% for current expenditure and 9% for capital expenditure. The Minister is the guilty party who does not ensure that there is money for investment. For how many years has the hon the Minister financed current expenditure from loan funds?
Last year, in a dreadful tirade, he lashed the hon member for Lichtenburg for having quoted from the report of the Reserve Bank. The hon the Minister accused a bank clerk, and I was the one who pointed that out to the hon member.
The hon the Minister tries to persecute people. He must not suffer from a mania for persecuting, threatening and intimidating people.
You are pulverizing them, oom Jan!
At times he made use of excessive credit …
Order! Was the hon member insinuating that the hon the Minister suffered from a mania? I think the hon member should withdraw the word “mania”.
I withdraw it, Sir. For him there is only one option. He wants to persecute everyone.
Let me tell the hon the Minister and I shall quote from his own publication: The Reserve Bank’s quarterly journal for December 1986…
It is not my publication. Do you not understand yet who the Reserve Bank belongs to?
It is your bankers’ publication.
Then the hon the Minister should simply resign and leave. The Reserve Bank officials are his chief advisers. His chief advisers comes to light with criticism from the quarterly journal of the Reserve Bank, December 1986.
I do not have a chief adviser.
That is why he makes such a poor showing; he has no adviser.
I quote:
But why was that the case? They recklessly spent money and had no control over that aspect. I am telling you now that it was done with a view to the referendum.
Let us quote further. I do not think we can say that the Reserve Bank does not have able men and that they are not good advisers. I quote further from page 45:
So I could quote a whole page. The Reserve Bank warned the hon the Minister that the old course was an incorrect one, but he takes no advice. The hon the Minister should rather not embark on that “spending spree”.
The hon the Minister now complains that there is too much of a rise in the gold price. He puts me in mind of the man who murdered his parents and then entered a plea of not guilty on the grounds of being an orphan. The hon the Minister—let us be honest—has wasted the country’s money. I have quoted him passages from the report of the Reserve Bank, and I do not want to quote from that source any further, but he is at liberty to go and read the entire page. It would be a good thing for him to do so, and then be less reckless in his future handling of the State’s money.
In the no-confidence debate the hon the Minister said:
He placed such emphasis on those three facts, but everyone knows that. A Grade I child could also tell the hon the Minister that those three facts are correct.
He made the mess.
Yes, he made the mess, but what is he doing to put matters right? Then he says that we spend hundreds of millions of rand in an effort to put matters right. His strategy, however, is completely wrong. If a man has drowned, and one takes him from the water, one is not going to pour more water down his throat to revive him.
That is what he is doing.
That is what the hon the Minister is doing.
Let us see what Mr Marius de Waal, chairman of the IDC, has to say about the hon the Minister’s new effort and the money he is employing to help people. We say thank you when people are actually being assisted, but the hon the Minister’s strategy is wrong. If one gives someone a fish to eat, he eats one meal, but give him a fishing rod and he catches fish and eats every day. [Interjections.]
On page 25 of Finansies en Tegniek, 3 October 1986, Mr Marius de Waal says:
That is all the hon the Minister has done. I quote further:
That is the solution, and I think Mr De Waal is correct in saying so.
The hon the Minister must create growth, and having done so, he would be in a position to establish opportunities of a permanent nature. I am glad of the growth he is, in fact, trying to create; we say thank you for that, but where he does not do so and merely gives away money, as in many of these cases, we cannot sanction it.
What about fixed investment? Last Monday the hon the Minister said there was a gross lack of fixed investment in South Africa. The hon the Minister himself, however, is the guilty party. He is responsible for that, as I have indicated. He taxes people to death. He also says there is tardy growth in private consumer spending. As a result of these high taxes, however, people do not have money in their pockets for purchases. They cannot save. If we look at direct and indirect taxation for the years 1981-1984, we see that there was an increase of 131,2% in total, or 32% per annum. In 1984 alone the current incomes of individuals increased by 17,5% and direct personal taxation by 41,9%. How were people supposed to save?
GST must be added to this. In 1981 the direct personal taxation, as a percentage of individual income, was 7,5%, and in 1984 it was 11,2%. And so it goes. For companies, of course, it was a much rosier picture, because in 1981 their taxation was 17,3%, whilst in 1984 it was only 10,9%. If it had gone on in that fashion, they would eventually have paid nothing.
The hon the Minister must look at savings. I am glad there is one tiny ray of hope in regard to saving in this Part Appropriation.
What about the tax reductions? Is that not a saving?
The hon the Minister now says here today that public servants are going to obtain increases in the Appropriation. Why is the hon the Minister again creating expectations? When they brought Coloureds and Indians into the new dispensation, the Government created expectations amongst the Blacks, and what happened? Is the hon the Minister now going to create expectations in the minds of public servants? I am not saying that they do not deserve the increases. Why does the hon the Minister not tell them what the increases are going to be? Why does he not indicate what he is going to do?
He is now promising the voters that there are going to be large increases. After 3 June, in the Main Budget, he is going to say: “Chaps, I am sorry, there is no money at the moment. We can only give you a 1% to 2% increase.”
What would you have done?
I do not know what. Anything!
What would the hon member have done?
The rate of personal savings evidences a negative trend. In 1980 the figure was 11,5%. In 1983 it decreased to 3%. At the present moment it is 1,5%. That information is on page 21 of the monthly publication of the Reserve Bank. The hon the Minister is at liberty to go and read it.
The State has too great a share in the economy. In 1981 it was 20,8%. According to the Reserve Bank’s report—I should like the hon the Minister to go and read it …
He never reads it!
… the State’s share in the economy in the first quarter of 1986 was 28%. The State’s share in the economy is continually increasing. The hon the Minister is at liberty to go and read the monthly publication of the Reserve Bank.
There is only one festering sore in our economy—the State is too wasteful. For example, it spends R4,3 million on producing a little song. Heavens, Sir! I wonder whether the NP representatives here are not ashamed of the fact. [Interjections.] This morning we must also have a look at that multiracial revelry. It was shocking! They must go on showing it on television! NP members are coming over to the the CP by the dozens.
There are a few things I should like to know. At the beginning of last year the hon the Minister said the growth rate would be 3%. At the moment it is 1%. Where is the other 2%? What did the hon the Minister do with that additional 2%?
The hon the Minister speaks of a “bruto buitelandse produk”—an economic term I have never encountered in the past. Could the hon the Minister give me a definition of this term?
It was probably a slip of the tongue.
According to the Gazette of 16 January the domestic revenue for December 1986—I find that very interesting, and I hope hon members will give the hon the Minister a chance to reply to this— was R2,937 billion. In 1985 it was only R1,926 billion. So in December R1,01 billion simply fell out of the blue. Can the hon the Minister tell me how that R1 billion was divided up. We want a comprehensive answer. I find it very strange that in December 1986 R1 billion was added to domestic revenue. It is a very strange thing.
In Finansies en Tegniek of 6 February Prof Tjaart van der Walt, the rector of the University of Potchefstroom, said the following:
That is the rector of my alma mater. He is an educationist. Is that now the advice he is giving the Government? First bluff and deceive the voters; first present them with a fine picture of things and then open the sluices. And he is a clergyman to boot. That is even worse! I should like to talk to him when I see him again one day.
What does the CP say? This is all I still want to say. What is the CP’s solution to the problem of State finances? We have a full package. Firstly law and order must be maintained by way of legislation. Everyone in this country must feel secure. There can be no economic growth when law and order is not being maintained.
What has the NP thus far done to maintain law and order? They have been lax.
Secondly one should persevere with a conservative fiscal and monetary policy. In this connection the hon the Minister should take the advice given by the Reserve Bank people. The hon the Minister must forget about his socialistic liberal politics of the redistribution of income and wealth. The hon the Minister is killing the goose that lays the golden eggs.
Thirdly the hon the Minister must get his priorities straight as far as Government expenditure is concerned. He must estimate what our export losses are going to be. Then, in regard to our imports, he must effect savings on luxury goods. He must, however, at all times protect our balance of payments.
The hon the Minister should have put a damper on these luxuries a long time ago.
What luxuries?
The pop song!
Yes, that is one example. Fourthly, we must promote productivity. I join the private sector in telling this hon Minister that he must set some or other productivity target. It must be within reach, and he must also ensure that it is, in fact, achieved.
The hon the Minister stands up here and announces that three departmental committees should investigate inflation. It was eight years ago that I, as a member of the AHI, asked for something to be done. Now the AHI has begun to do something at its own expense. I am now asking the hon the Minister why he waited so long, after having become Minister, before having announced these investigations. [Interjections.] Now suddenly, now that there is an election at hand, he wants to go and tell the voters that things are going well and that the committees have been appointed.
In the fifth place our people should not be overtaxed and saving should be recommended. If the hon the Minister were to control his expenditure, he would also be in a position to relieve taxation. Perhaps I should really not be too hard on the hon the Minister; perhaps I should be a little lenient. [Interjections.] I want to quote from the Financial Mail of 14 December 1984:
[Interjections.] I acknowledge that he is right—it is difficult to understand concepts that fall outside one’s field. They must not, for example, ask me, in a hospital, to do a heart by-pass operation, because when I was finished with the patient, he would be dead. [Interjections.] At a further point in his article the writer states:
In conclusion I want to ask the hon the Minister whether he is aware of the number of people who are emigrating from South Africa these days. Without quoting all the statistics, let met tell him that more than four thousand people per month are leaving the country. They are professional people inter alia accountants, attorneys, advocates, doctors and professors. They no longer see their way clear to remaining here whilst the National Party is governing. That is why I am glad that 6 May is coming so that the CP can triumph and push out this Government. In South Africa we shall maintain law and order and introduce a sound economic policy so that those people will return and live here under a CP government which governs well and governs properly.
Mr Chairman, once again, as so often in the past, we have had to listen to a flood of criticism of what the hon the Minister said in the Part Appropriation Speech he has just made. [Interjections.]
We on this side of the House do not want to deny the opposition—meaning the Official Opposition as well as the other opposition parties—the right to criticise; on the contrary, I think it is the opposition’s right to criticise the Government if there are things that are not in order and things with which fault can be found. I think it is only fair and reasonable for us on this side of the House, however, to expect that the opposition, and specifically their spokesmen on finance, should present workable alternatives as solutions.
The hon member for Sunnyside came forward with the solution, that law and order should be maintained in South Africa. Surely the Government is doing everything in its power to maintain law and order. [Interjections.] Does the hon member want to discredit the efforts made by the security services to maintain law and order? That, after all, is what the hon member for Sunnyside has done with that notion of his.
He said priorities in South Africa should be rectified. The priorities in South Africa are determined by the Priority Committee. I think they succeed to a great extent in determining priorities in order of importance.
The hon member rose here, however, and said luxury articles should not be imported. The question he should really answer, is which luxury articles not needed for the development of South Africa are imported. I think the hon member for Sunnyside failed to succeed in spelling out the alternatives to us in the way in which it would behove a responsible opposition party in South Africa to do so.
As I said, it is only fair of us to expect the opposition speakers to spell out the true alternatives. It is not sufficient to lay the blame for the high inflation rate before the Government’s door, while no workable method is being recommended to combat inflation. The question immediately arises, when they criticise overspending on the side of the Government, whether they did not want to permit that overspending to take place. Not one hon member on that side of the House will say that we should not have supplied drought relief, or that we should not make adjustments to the salaries of public servants. [Interjections.] For the moment, however, that will suffice and I want to discuss the salaries of public servants briefly.
I am truly grateful that the Government did not give in to the temptation to make a political wrestling match out of the question of public servants’ salaries. It was responsible of them to keep this out of the election campaign. In addition I am grateful that we have heard from the hon the Minister that the question of salary increases for public servants will be considered with the greatest circumspection and responsibility. I also want to express my thanks and appreciation to Dr Cameron, the president, and the management of the Public Servants’ Association, for the professional and disciplined way in which they make representations to the Government.
I cannot but dwell for a moment on what Mr Christo Kuun, the President of the Afrikaanse Handelsinstituut, said in this connection. I do not want to argue with him today; on the contrary, I am convinced that he and his institute make a very important contribution to the South African economy. In yesterday’s edition of Rapport he appealed to the Government not to permit the public sector’s salary bill to rise by more than 10%. In addition he appealed for further reductions and rationalisation to ensure that the increase in the salary bill will be no more than 10%. I do not think the Public Service can be accused of not having pulled its weight in this connection, or of not continuing to do so in future. Further privatisation can definitely mean greater relief to the salary bill of the Public Service. I believe that is possible. We must ensure, however, that our demands for greater staff reductions do not lead to the effectiveness of the Public Service being forfeited. When the AHI pleads, therefore, that the salary bill should not rise by more than 10%, and especially when the normal increment is taken into account, they are pleading for a pathetically low adjustment to Public Service salaries, which is far less than 10%. I want to say immediately that that is not acceptable to the official, and I do not believe it was the intention of the AHI to express it in that way. [Interjections.]
Mr Kuun warned in this report that the Public Service salary increase would be inflationary. The fact is, however, that a reasonable and fair salary adjustment is necessary precisely to enable the official to relieve the pressure of inflation to an extent. Whereas the Public Service has done its share during the past few years to moderate salaries, unfortunately this cannot be said of all sectors. In this connection Mr Kuun has hit the mark in one respect. The moment the Public Service gets an increase, trade and industry and the service sectors will react immediately by increasing prices. That is inflationary. That is what causes the problem in our economy.
Mr Kuun’s second argument, viz that a salary adjustment benefits only a certain section of the population, does not really hold water either. As an alternative he suggested a decrease in tax rates. That is not the answer to this argument, because that results in the better paid person getting the greatest benefit. I am therefore pleading today for a reasonable and fair increase for the official, so that he can commit himself totally to his work without the constant fear that price increases are going to squeeze him to death.
The consumer is ready to spend and to contribute his share in that way to getting the economy going. Nevertheless one must guard against the irresponsible and reckless increase in prices with greater realism and patriotism. One of the most important reasons for the consumer’s remaining hesitant to spend is the fact that there is a fundamental resistance in the consumer to this mad increase in prices. It will be difficult, therefore, for the consumer to change his spending pattern until a significant levelling off in the rate of price increases takes place.
The economy probably still has a number of growing pains to struggle through before it eventually moves on to the course of sustained recovery. We are all responsible for ensuring that the economy is placed on the course of recovery. That is why financial responsibility and financial patriotism in everyone is of the greatest importance.
Mr Chairman, the hon member for Gezina will excuse me if I do not follow on his track, as I have my own little row to hoe. I would very much like to be able to congratulate the hon the Minister of Finance on his mini-budget. Apart from the fact that I think he is an extremely nice person, and would therefore like to please him, it would be very good for the country if one were able to do just that. Regrettably, it is difficult to find any points in this mini-budget on which one can congratulate the hon the Minister.
You are a dying party.
The hon member who said that is a pathetic little man, whoever he is!
We believe that one of the problems is that the Government lacks the clarity of vision and determination necessary to resolve our major financial problem which is, as everybody knows, inflation. To achieve some success in this area, there must be a substantial drop in public spending, particularly in the non-productive areas such as the control bodies and the inspectorates which make life difficult for low-cost entrepreneurial development and, of course, prop up the apartheid system still prevalent in all aspects of South African life.
Tax reforms which are anticipated as a consequence of the Margo Commission are apparently being delayed until May. Any increase in domestic fixed investment is therefore, I believe, going to be delayed.
After all, who wants to put money into fixed financial investments when, with excessive taxation and massive inflation, one loses in real terms 10% to 15% of the value of one’s capital per annum?
I wish to quote from Your Money, a publication which came out this month:
It goes further:
And remember a large number of people, particularly pensioners, live on fixed incomes from investments—
This, to my mind, is quite a serious matter. We in these benches have been making this point for several years and it still does not seem to have been brought home to the Government. Now, with the difficulty we have in obtaining foreign investments owing to sanctions and a perceived climate of instability, domestic fixed investment is more imperative than ever. In fact, the hon the Minister makes this very point from time to time. I should also like to mention a point which he might bear in mind. In Japan the first 3 million yen of interest income per person is tax-free; that is more than R40 000. No wonder the Japanese are the world’s record savers and have enough capital not only to develop their own country but many others too. I think that is worth bearing in mind.
We are aware that it is vital to boost the economy especially bearing in mind the substantial unemployment situation but we do not believe that it is wise to follow the route of increased Government expenditure to achieve this objective. We do not consider it wise either to increase the pay of public servants across the board. This has apparently been promised for later on. We believe that tax reductions would achieve the same end by making more money available for the man in the street and at the same time substantially assist in the reduction of inflation.
In respect of public servants’ pay—and other hon members have made comment on it—we in these benches believe that the really necessary and competent bureaucrats must be adequately paid, otherwise the service would be drained of competent people, and we have a number of highly competent people. However, we do have grave doubts as to the desirability of an increase of 10% to 18% across the board which has been called for, the reason being to keep up with private enterprise. Our economic advisers— and we have some very good ones; in fact, some of the top people in the country—indicate that the private sector increases in the past year or so have been nowhere near 18% and in many cases have been well below 10%, and that in any case normal notch increments enable many public servants comfortably to keep pace with the private sector anyway. Furthermore, the Public Service also enjoys more housing, car allowance and pension benefits than are available to most of the private sector. Once again it must be remembered that job security in the public sector is far greater than in the private sector. Many people in the private sector have lost jobs right up to management level as a consequence of the current depression and bankruptcies. To the best of my knowledge the depression has not cost any public servants their jobs. Whilst too much emphasis should not be placed on job security—people must live even if they are in secure jobs—it must be of some value.
Although we are sympathetic to the legitimate claims of public servants, especially in the lower categories, we sincerely hope that the Government will not try to buy support from the electorate even with promises of increases during this election. We simply cannot afford the huge increases that are being called for without increasing the inflationary spiral. In any case, with inflation as it is, with bracket creep and the increasing tax for the people in the upper income levels, I would be inclined to say if I were a public servant: “Please do not give me any increase because I cannot afford it.” That is the kind of crazy situation we are getting into at the present moment.
Of course, many of our financial woes are directly attributable to the Government’s policy of apartheid, the “outmoded system” as the hon the State President called it in his Opening Address of last year which according to ministerial rhetoric, is “dead”. We agree that it is outmoded but it is certainly not dead. The whole world and most of the population of South Africa see it as being very much alive. That is why we are suffering the effects of sanctions and its concomitant ills. That is why we are suffering a brain drain as many of our more able young people are seeking a future out of South Africa. That is why cross-pollination of knowledge in our universities is slowly drying up. That is why our sportsmen are ostracised and why even the credibility of our Government is in itself often questioned.
Of course, the Government talk about reform and they say they are even prepared to sit around the table with other races on the subject but I am afraid that the perception is of talk and not of action. We do accept that certain important reforms have taken place but the really critical ones are still in front of us and demand action. Unless and until that action is taken our economic structure cannot and will not materially improve.
I would like if I may to finish on a sweeter note rather than a more sour one. We are appreciative of the fact that the loan levy of 1983 is to be repaid. I am sure that that will ease the burden for some people. Whilst we could have hoped for more we nevertheless appreciate the little assistance that will be given as far as the tax structures for working wives are concerned. Like Oliver Twist one will put out one’s hand the next time and say: “Give me more!”
R100 million is not a little bit.
In comparison to the billions the hon the Minister is talking about it is only a little bit.
The assistance to pensioners is of course very essential and they are in urgent need of it.
Finally, I would say that on a broad basis I could not with all the good will in the world say that I feel this is a terribly good minibudget because we have all the tax disadvantages of socialism without any of the benefits.
Mr Chairman, the hon member for Umbilo will pardon me if I do not respond to what he said, because in the limited time at my disposal I should like to confine myself to another aspect.
It is your last speech in the House of Assembly.
Since we have such a talkative hon member here with us, I want to ask him whether he can possibly help us in connection with certain statements made by his hon leader earlier. He merely wants to tempt me into talking politics with him so that I do not get around to my speech.
This is your last speech, because after the election Newcastle will be a CP seat.
Surely the hon member for Kuruman is the last hon member who can talk about a last speech.
In the no-confidence debate this year, the hon the Minister of Finance pointed out that the South African economy was experiencing a series of problems. He said inter alia that the growth rate was too low and the inflation rate too high, and he singled out the problems in respect of unemployment, the tardy growth of private consumer spending, as well as the important aspect of low productivity. He also pointed out that the Government was weighed down by an international onslaught as far as our economy in particular was concerned.
Although all these factors are negative factors, it is my standpoint that in these times, as at all times in the past, the Government is doing everything in its power to lighten the burden of the man in the street. This has appeared very clearly once again from the Part Appropriation Bill submitted by the hon the Minister here today. I am afraid, however, that one cannot obtain a full perspective by looking only at this Bill. I want to single out two or three other facets, therefore, which were dealt with during the Appropriation Bill last year and have been implemented since.
The first facet is the employment creation programme. The sympathy the Government has with the South African worker in these times is reflected in the special employment creation and training programme that was instituted. The Government has allocated an amount of R450 million for this purpose during the present financial year. At the end of September 1986, approximately a quarter of a million unemployed people had been placed in employers’ positions through this employment creation programme. According to planning, estimates are that more than half a million unemployed people will receive training before the end of March this year.
This special programme is being used for the training of and provision of employment to unemployed people, for a programme for the small business sector and for the support of the unemployment insurance campaign. The results that were obtained in restoring unemployed people’s human dignity speaks volumes. At least 25% of those who received training could obtain work immediately afterwards.
I think the most meaningful aspect of this training programme is the fact that an unskilled person, who may have been a handyman formerly, is now learning the basic principles of a kind of work. This enables him to render a better quality of work and, in many cases, to begin his own enterprise. The NP is taking positive steps to relieve the distress of the unemployed and to help the small businessman to create employment opportunities and to expand training opportunities.
To see the matter in its full perspective, I want to refer to another aspect. During the present financial year, the Government voted an amount of R1 billion for housing and community facilities for all communities. This is by far the largest amount ever made available for this purpose in a single year in the history of South Africa.
As far as agriculture is concerned, the Government is still, as in the past, involved in large-scale granting of aid in a variety of spheres. Almost R0,5 billion forms only part of the Government’s short-term aid to farmers who have serious financial problems. Just less than R300 million was given to farmers in drought-ravaged summer grain areas during the past three years. As the hon the Minister announced this afternoon, an amount of R170 million is being allocated in this Part Appropriation as the first instalment in a programme extending over five years for the reconstruction of agriculture in the drought-ravaged areas. A further amount of R120 million is being voted for various other aid programmes.
As far as personal income is concerned, one can say that although the pressure on the Treasury is exceptionally great, with inter alia the security and welfare expenses claiming a large part, the hon the Minister proved once again this afternoon that the Government cares. There is no doubt that the Government is doing everything in its power to fighten the burden of the man in the street. The Government’s standpoint on the salary increases as announced here, has been discussed by previous speakers. Once again this indicates the responsible way in which the Government deals with the salary structures of the public servants.
The same applies to the phasing in of fringe benefits. This will not be seen as a supplementary source of income for the Government. The adjustment made by the Government in respect of the working married woman this afternoon is also conclusive proof that the full spectrum is being considered. As far as social pensions are concerned, an amount of R200 million was allocated for social pensioners.
I want to dwell for a moment on the question of our senior citizens. The tax threshold of married people above 65 years of age was increased in today’s Part Appropriation from R9 113 to R9 966, an amount of R853.1 think it is very important, when we talk about our senior citizens, for us to consider the whole situation. We must not lose sight of the concessions that were granted to the senior citizens at the beginning of the tax year, when the tax threshold for people above 65 years of age was increased to a great extent. The component of medical expenses, which are deductible from income-tax, was increased considerably. The tax rebate for these people was also increased so that everyone who is older than 65 qualifies for a tax rebate of R500.
If one keeps all these aspects in respect of our senior citizens in mind, one will see that the Government has a very sympathetic attitude towards this group of our country’s citizens.
We on this side of the House want to thank the hon the Minister for the very balanced budget he submitted here today.
Mr Chairman, what we have heard today from the side of the Government, also from the hon the Minister of Finance, is excuse after excuse. I can understand why they are looking for excuses, as well as why they are reluctant to make the economy an election issue. If my record were as bad as theirs, I would not want to discuss it either. [Interjections.]
Since 1980 our economy has shown a growth rate in real terms of 1% per annum. This is the worst growth rate we have achieved for a decade since the 1920s. Even in the 1930s we had a real growth rate of 5% per annum. In the 1980s the growth rate is 1%. Some record that is!
In the 1960s we grew at 5,9% per annum. In the 1970s the growth rate was 3,6%. In the 1980s it is 1%. I ask myself: What can we look forward to in the 1990s if this Government is returned to power?—a growth rate of –1,5% per annum! [Interjections.]
In 1981 when this Government was re-elected the gross domestic product per capita in real terms was R2 127. At the end of 1986 it was R1 917. That represents a decrease of 10%. In fact, in terms of our per capita GDP we were back to the levels of the 1970s.
We ask this Government, which has been in power for so long and has controlled this economy for so long: Why are we back to the levels of the early 1970s despite a more than 10-fold increase in the price of our major economic asset namely gold?
Nothing, however, has endangered South Africa’s stability more than this Government’s ability to destroy jobs. When one looks at the figures for June 1986 one finds that the manufacturing industry employed 133 000 people fewer than it did when this Government was re-elected in 1981. In the same period 50 000 jobs were lost in the construction industry. In 1986 the manufacturing sector, which in a country like South Africa is normally the machine which gives the economy growth, employed fewer people than in 1975. The construction industry employed 190 000 fewer people in 1986 compared with 1975.
According to a study at Unisa, An Assessment of the Development and Welfare of Employees in the Republic of South Africa, the correct unemployment figure at present is about 1,7 million people or 23,1% of the workforce. If the performance of the past five years is continued, it is estimated that 81% of the new entrants to the labour force will be jobless by the year 2000. If that does happen, does this Government think we have any chance of maintaining stability in South Africa? We will not have a chance at all.
The situation could, however, become even worse. In order to win this election, there are members of the Government who have adopted the policy of telling the outside world to go to hell. They can say that because they have neither understood nor cared about the economic consequences of their actions. Any country whose external trade is equivalent to approximately 60% of its gross domestic product needs the outside world, whether we like it or not.
Do these super patriots, however, realise the impact that disinvestment and sanctions could have? When one considers this study done by Unisa one finds that they estimate that if disinvestment and sanctions were fully implemented, an additional one million people would be unemployed in South Africa, of whom 152 000 would be White people. If that happened, unemployment in South Africa would be 31,9%.
The economic performance of this Government has been disastrous but all we hear is a constant refrain from the hon the Minister and hon members opposite that we have experienced difficult times …[Interjections.] … and we must not judge him and his party too harshly. But they have been governing South Africa for nearly 40 years! The decline in the economy is due to structural problems which have been apparent since 1976 at least. Why have they not done something about this?
One will only have reasonable economic progress if the social, political, legal and economic infrastructures favour it. The Government plays a critical role in determining the nature and rate of economic growth. It has the power to influence, either positively or negatively, the foundations on which economic growth is achieved. However, what we have in South Africa is a government which refuses to accept accountability for its economic performance but which steadily increases the number of those who should be held unaccountable.
The conditions necessary for economic growth in developing countries are well-known. In a World Bank study of 20 countries by Keith Marsden it was found that the annual rate of growth in gross domestic product was more than 6% higher in the low tax group of countries compared to the high tax group of countries.
Sir, let us go back to when this Government was re-elected. In the tax year that ended in March 1981 an amount of R2 090 million was collected from individuals. Six years later—I am using the estimate that was made in last year’s Budget Speech which I assume would be fairly correct—R11 400 million was collected. This represents an increase of 445%. Over the same period the amount collected in the form of GST increased by 470%. In 1981, when this Government was re-elected, tax was equal to 8,1% of disposable income. In 1985 it had risen to 13,3%. It is no wonder that, in real terms, South Africans spent 20,7% less on furniture and household appliances in 1985 than they did in 1981, 44% less on personal transport equipment and 5% less on clothes— despite the fact that the population was increasing. At the same time personal savings of individuals declined from 12,2% in 1981 to 4,3% in 1985.
Another factor that economists have highlighted is that economic growth suffers in developing countries where the governments have a prominent role. I should like to quote two examples to the hon the Minister. In 1962 Ghana and South Korea were in a very similar situation. One had a per capita gross national product which was one dollar more than that of the other. They were both reliant on primary exports and had the same percentage of the labour force in agriculture. Twenty years later the per capita gross national product of South Korea was five times that of Ghana. In Ghana credit to the public sector was equal to 49% of its gross domestic product. In South Korea it was 2%.
At the end of 1985 public authorities and corporations owned 57,3% of the fixed capital stock of South Africa. The public sector’s contribution to the gross domestic product had increased from 22,9% in 1975 to 24,5% in 1981 to 29,2% in 1985.
While jobs where being destroyed in the private sector, the public sector was booming. In 1986 the central government employed 61 000 more people than it did in 1981, and nearly 125 000 more than in 1975. That is an increase of 45,6%. Remember that I have already said that in the manufacturing sector there had been no growth, and in the construction sector 190 000 jobs had been lost over that ten year period. We are told that this increase in Government employment was because of additional teachers etc. Sure, I will accept that additional teachers were employed. When, however, one analyses the employement figures it is very interesting. While employment by the public authorities— which is the broad definition—increased by 13,7% between 1980 and June 1986, the increase in the central Government was 22,4%. It is interesting to note that the number of people employed in business enterprises in the public sector declined by more than 35 000 between 1981 and 1986.
We hear so much about Government remuneration. Their share of total remuneration increased from 20,8% in 1980 to 25,4% in 1985. The remuneration of the Government sector increased from R4,3 billion in 1980 to R12,6 billion in 1985—an increase of 190,5%. In contrast, the increase in the total remuneration of the private sector was 124,1%.
Despite all this expenditure a Unisa study found that 40% of the Black population of the Republic aged 20 years and older in 1980 had had no formal schooling. What an indictment! Until there is a reduction in the cost of governing South Africa taxes cannot be lowered in real terms. All that can be done is that the tax burden can be rearranged. Until we lower taxes we are not going to get investment, and we know what has happened to investment in South Africa.
In this coming election we say to the voters of South Africa: “You have seen this Government’s economic performance. You have suffered from their incompetence and economic mismanagement. If you enjoy economic masochism vote for them again. If not, join with those of us, like the PFP, who wish to get this Government off the backs of the people. The burden has become intolerable”.
Mr Chairman, the hon member for Edenvale pointed an accusing finger at the Government for every possible problem he perceived in this country. Of course, his type of election tactics are very transparent. When he sees something that is wrong, the Government carries the sole blame for it, while certain important factors that play a role in development in South Africa are not taken fully into account.
Last week we heard a great deal about the ANC and about America. Indeed, it has also been argued here that the Government is fighting the ANC and America as if they were participating in the election, where as in fact they are not participating in it. That standpoint is of course quite wrong. What is very important in the coming election—very important for the future of South Africa as well—is the policy of every party with regard to those matters and in particular the case to which I have just referred—that of the ANC. What precisely is the policy of the PFP in this regard?
The ANC is totally committed to violence and revolution in South Africa. What the policy of the PFP amounts to is that the ANC must be legalized and negotiations must be conducted with it.
Albert Nothnagel also says so, and he is a “New Nat”! [Interjections.]
The first question to be asked in this regard is what the PFP’s policy is in respect of the aspect of ANC violence. Are they prepared to negotiate with the ANC while the ANC remains committed to violence and revolution.
Albert is!
Mr Chairman, if the PFP is prepared to do that then the time has come for them to tell the electorate that they are going to negotiate with the ANC despite the fact that while they are negotiating the ANC will still be committed to violence.
[Inaudible.]
Order!
Mr Chairman, there is no indication as to what the situation is. To tell the truth, everything suggests that the opposite is in fact the case. That is to say; if the ANC were to be legalized it would still remain committed to violence. There can be no doubt in this regard.
†Sir, it is very important to note the PFP’s attitude in this regard. It is quite clear that they are prepared to turn a blind eye to the ANC’s commitment to revolution and violence in South Africa.
That is not true! [Interjections.]
The hon member says that is not true. If that is not true then they must tell the working public whether they are prepared to negotiate with the ANC, even if they remain committed to violence and revolution. They must give that answer and we are waiting for that answer. [Interjections.] That answer has not been given.
Order! Is the hon member prepared to take a question?
No, Sir. There is also the other possibility that they will say that we should take the Eminent Persons Group’s alternative. Let us negotiate with the ANC if the ANC is prepared to suspend violence during the period of negotiation. But during that period they will still be training terrorists, they will still be preparing for an onslaught on South Africa, and that will really be condoning violence in South Africa because one is saying to the ANC that the Government accepts that if these negotiations are not successful then they can continue with their violence and their attempts to bring about revolution. We want a clear point of view on this.
There is also another factor. That is the position of communists within the top leadership of the ANC.
*According to the South African security forces, 23 of the 30 members of the executive of the ANC are either members of the SA Communist Party or supporters. Other security services—I refer to those of America and Britain—that have made statements in this regard based on reports by their security services have intimated that there is a fairly strong consensus among security forces in the West that at least 50% of the leadership of the ANC as represented in the executive of the ANC—which consists of 30 members—are members of supporters of the SA Communist Party. The SA Communist Party is also a prohibited organisation in South Africa.
Members of the executive of the ANC are also members of the Umkhonto we Sizwe. The leader of Umkhonto we Sizwe, Joe Slovo, a chairman of the Communist Party, is also member of the executive of the ANC. The following is a logical inference: If one says that one is prepared to negotiate with the ANC and that the ANC must for that reason be legalized, then one must also necessarily say that the SA Communist Party must be legalized and Umkhonto we Sizwe must be legalized. Otherwise, if one only legalizes the ANC one is still unable to negotiate with the executive because a great many of them are members of the SA Communist Party or in a management position in Umkhonto we Sizwe. [Interjections.]
No, I do not wish to answer a question.
What we want to know from the hon members on the other side of the House—I hope that they can reply to this question, because the electorate also wants to know— is whether they are prepared to accept the logical consequences of their policy of negotiating with the ANC and legalizing them, namely that they must also legalize Umkhonto we Sizwe and the SA Communist Party.
†This will be a very important issue in the next general election. I would like to hear those hon members on that, Sir. They can tell us what their policy in this regard is. However, we will say to the electorate—and we will say it clearly until such time as we have an authoritative statement from that side of the House—that the policy of the PFP is the unbanning of the ANC, the unbanning of the SA Communist Party, the unbanning of Umkhonto we Sizwe and the condoning of the commitment to violence and revolution of these parties and negotiating with them under those circumstances.
We say to the people of South Africa of whatever race or colour that the future of this country cannot be entrusted to a party like the PFP which will not be in a position to negotiate a safe future for all South Africans. [Interjections.]
Mr Chairman, the hon member who has just spoken must pardon me for not commenting on his speech as I have my own which I should like to make.
In his appropriation speech the hon the Minister of Finance mentioned a, housing trust to make housing possible for less privileged people. I am grateful for this. Nevertheless we should like to know, later during division, how this is to be done.
There is no provision in the appropriation for people who stand to lose millions of rands because the Government is recklessly building massive Black towns on their doorsteps and the value of their property is declining enormously in consequence. I realise a relevant amendment cannot be adopted in this appropriation but it will be of very great importance in a following one because there are people in my constituency losing millions of rands.
I now want to speak for the third time in this House on the fatal Black tide engulfing the far East Rand. I refer to my previous speeches in this House, on 8 May 1985 (Hansard: cols 5087-5094) and again on 12 May 1986 (Hansard: cols 5407-5411). I can also refer to a number of letters which passed between the hon the Minister of Constitutional Development and Planning and me. In this correspondence and in the House of Assembly I clearly indicated my opposition to the huge Sowetos on the far East Rand.
I mentioned the fact that the value of White properties would be very adversely affected. I also indicated that the Black town which is to be established between kwa-Thema, Tsakane and past Duduza and which will reach very near to Dunnottar and Sharon Park would be in no one’s interest. It is not in the interest of Blacks either for where will they find employment? There is no work for those people already; one need only examine the amounts paid out to Black people unable to obtain employment. There is enormous unemployment as matters stand at present and the Government’s proposed— already approved—Black town will aggravate this.
Thank heavens for the revival of the gold mines near Dunnottar. They are situated between Dunnottar and the Black town and will give Dunnottar a breathing space of between 10 and 15 years. According to responsible mining officials, those mines will have a possible lifetime of 10 to 15 years. I wish those mines the best of luck. May it happen that they discover such rich gold deposits that they will still be there for the next 100 years because this will keep that Black town away from Dunnottar longer.
I also approached the hon the Minister with the application of a certain farmer. He wanted to have his land, which comprises approximately 467 ha, bought out to enable the Black town to be moved there and the buffer strip between the White towns enlarged by a further 467 ha in consequence. All honour to the hon the Minister of Constitutional Development and Planning. I wish to thank him because he was prepared to consider the proposal and this provided a degree of hope. I even held back a protest meeting because I did not wish to be unfair to him.
Even NP newspapers like Beeld write that no one’s life is safe any longer. That is why I know this problem which will be created on the East Rand will aggravate matters enormously.
On 23 September I received a letter from the hon the Minister and wish to thank him for it. The letter runs as follows:
This brings me to the Black Plan. I shall read hon members a letter from the Black Plan people. They deceived people; they also deceived the farmer concerned. The farmer’s name appears frequently in the letter the Black Plan people wrote to the hon the Minister. I do not wish to bandy the farmer’s name across the floor of this House, however, and shall therefore refer to him as Mr X. [Interjections.] The letter is dated 12 September 1986 and addressed to the hon the Minister of Constitutional Development and Planning:
The last paragraph runs as follows:
That is how the letter ends.
I observe from the Black Plan letter that they apparently have offices in Soweto and Sandton. Are their activities there not perhaps the cause of the very great impatience of the people in the vicinity of the proposed Norweto? In addition, it seems that they have offices in Pretoria, because the telephone numbers and post boxes appear in that publication.
It is unnecessary for them to open an office in Springs—they may as well use the NP office there as I am sure the MP for Springs, who acts as the guardian of the Nigel constituency, will make his services available to them voluntarily.
I noticed in print at the foot of the Black Plan letter: “Represented by G J Thula, D J du Plessis, C Hanekom, C A van Tonder and I N Dube”. There is a Black Plan for houses for Blacks but is there a White Plan to protect the houses of Whites against decreasing values in consequence of Black towns on their boundaries? No, there is no such plan.
I also noted from the letter that Mr J H Visagie, MP, was aware of the problem too. I wish to state unequivocally that I have never been consulted by anyone from Black Plan or any person associated with them. They know only too well where they stand with me; I would not touch them with a ten-foot pole. My standpoint to guard the interests of my people near the front does not bear a price tag. I call the narrow buffer strip the “front” because peace has fled.
The question is: Does the Government still care for the Whites living in that area? There are certain matters that never cause me to laugh such as certain types of jokes and folly. Nevertheless when I saw that my constituency had a guardian MP, I laughed. Does that guardian MP not realise that he is attempting to bedevil my people’s affairs? In this process he will also deal the people of Selcourt in his constituency a knockdown blow.
On 6 May he is free to be the guardian MP of my constituency because on that day the people of Springs, and in particular the people of Selcourt, will deal with him. Just imagine, a Black town of greater hectarage than the present Soweto! The letter states that the course they are taking and I quote:
What a foolish statement to make! These people know only too well that Black housing will never be capable of solution near White cities now that influx control has been abolished as people are simply pouring in. All floodgates to the cities have now been opened and unemployment will increase.
Sir, already there is no longer adequate water for all the people within the Vaal Triangle. On 14 May 1985 I put questions to the hon the Minister of Water Affairs. On 25 January 1987 Rapport shrieked: “Dit is klaarpraat met die Vaaldam”. We recently heard in the news that the price of water in the Vaal Triangle could rise by as much as 600%. I heard this in the news myself and then, as true as God, the Government wants to burden the Vaal Triangle with extra towns as well. What folly! These events are coming. It is high time for this Government to be dropped. [Interjections.]
There are even Ministers ignorant of what is occurring. For instance, I put a question to the hon the Minister of Water Affairs and had his reply on 14 May. I ask whether there were cracks and/or leaks in the wall of the Vaal Dam and, if so, what would be done about this, whether he would issue a statement and so on. He replied in the negative and the rest of the questions fell by the way-side. Nevertheless Rapport of 25 January 1987 carried the following:
So there were cracks. [Time expired.]
Mr Chairman, the previous speaker will pardon me for not replying to what he said. I shall merely read my own speech.
I am exceptionally grateful that the hon the Minister of Finance saw his way clear to making an additional R240 million available to farming. This will help us tremendously in the difficult course we have embarked upon in the restructuring of the maize industry. Broadly this restructuring in the cultivation of maize comes down to the fact that between one million and two million hectares will be withdrawn from maize cultivation and be applied for alternative agricultural production.
These steps became essential because the foreign export market for maize collapsed completely and also because the consumption of maize in domestic trade decreased from seven million tons per annum to under five million tons for various reasons.
Nevertheless the maize industry is the giant among summer rainfall agricultural operations. That is why even a small movement of production factors away from maize to other operations can hold catastrophic implications for those operations. For instance, if only 10% of maize land were to be withdrawn and applied for the production of sunflowers, the production of this crop would increase by at least 130% which would create total chaos in the sunflower industry. We could continue in this way and also indicate how terrifyingly drastic the effect of a movement of production factors away from the maize industry to other production areas would be.
There is only one large production field which does not have this problem and that is wool. The reason the wool industry is not also affected by this problem which would be created by a movement away from maize is that only 5% of the world’s wool is produced in South Africa. Even if the production of wool in the country were to double, it would still not have an appreciable effect on the world supply of wool and its price.
If the wool-sheep population in the country were to double from 16 to 32 million, between 1 million and 1,5 million hectares of maize land could be withdrawn as well, which would provide great relief as regards the maize surplus; it would probably even eliminate this surplus entirely.
This is not a course without problems, however. The following could be identified as problems in such a large-scale switch to wool production. Firstly, the income per hectare from wool was always much lower than that from maize. It would therefore be almost impossible to use the income from wool to extinguish maize debts.
The second question which will have to be answered is where the finance is to be found to fund the purchase of sheep and the planting of cultivated grazing in the first place; secondly, to provide a cash flow to meet obligations until such time as the wool starts to generate finance and, thirdly, to purchase breeding stock to provide wool sheep. In the long term an increase in the numbers of wool sheep will exert downward pressure on meat prices as well.
My purpose is specifically to discuss the financing of farmers in this restructuring process. To this end it is obviously necessary for us to inform ourselves of the present state of farmers’ affairs and the reasons for this critical situation, for instance the enormous increase in farming debts to more than R11 billion, the effect of the drought which contributed R1,7 billion as well as increased interest rates of R3,4 billion and inflation of R2,7 billion. The desperate state of farmers’ finance is best illustrated with the aid of computer simulations which the six largest maize co-operatives carried out in this regard. According to these, at current maize prices and taking a crop of 9 million tons— that is a normal one—and the current level of Government assistance, only about 60% of maize farmers will survive. Even if there were to be a total interest standstill on carryover debts, assistance with interest on production debts and a scaling down in farmers’ standard of living by 25%, at the current price and production levels another 20% of these farmers will have to leave the land.
Where do they go?
They go to the cities. The main reasons why current measures cannot release farmers from their difficulties are the following. The percentage of farmers’ debt which comes into consideration for an interest subsidy is too low. Secondly, there is their lack of collateral. The ratio of farmers’ debt to their assets has deteriorated to such an extent that they can no longer obtain money from banks. [Interjections.] The third reason is that the enormous losses realised on the export market entirely nullified the profitability of the maize industry.
Measures to help keep farmers on the land will therefore have to satisfy the following requirements: Firstly, interest subsidies will have to be increased. Secondly, the financing net will have to be cast more widely to enable a greater percentage of the debt to qualify for interest subsidies. Some of the debt at commercial banks and the Land Bank will also have to qualify for this. Thirdly, the State guarantee scheme will have to be extended further so that farmers may acquire funds again to be able to finance their farming operations and their restructuring. Fourthly, export aid will have to become a reality for agriculture. Fifthly, a fresh look will have to be taken at the transport costs of the Transport Services.
There has to be a realization on the part of the farmer, however, that the State has a great responsibility toward the taxpayer, and the aid will therefore have to be applied to help the farming community out of its predicament and not to enrich this community at the expense of taxpayers. Neither should the assistance be of such a nature that it destroys the soil of the country. It is therefore vital that the aid be effectively controlled.
In conclusion, before any new aid measures are designed, the current measures should be evaluated and previous loopholes which could be abused, identified. They should then be put right. After the introduction of the new scheme, it should be monitored constantly and control exercised on a continuous basis in order to ensure that farmers’ effectiveness and expenditure comply with the requirements set.
Mr Chairman, in addressing this House for the first time this afternoon, I am well aware that every hon member has experienced, or has yet to experience, this ordeal for himself. However, I regard it as a significant occasion in my life.
I am sure the hon member for Heilbron will forgive me if on this occasion I do not respond to his remarks but leave that to some of my colleagues.
I am deeply aware of my responsibilities to my constituents in Pinelands and will always make myself available to them. I am also excited at the prospect of playing a part in the political events unfolding in our country.
The suburb of Pinelands, which comprises roughly half the constituency, is unique. It is the first planned community in South Africa based on the garden city movement in Britain. The Garden City Utility Company continues to provide housing among all the communities in our country, and to date has provided some 7 000 houses, placing great emphasis on a good quality environment. The open spaces, parks and tranquil living conditions in Pinelands are a tribute to their philosophy.
I would like to devote my speech this afternoon to certain aspects of manpower development which have a significant impact on the future viability of the South African economy. Hon members are well aware of the manpower crisis which faces us. The hon the Deputy Minister of Population Development has stated that about 4 million South Africans could be unemployed by the year 2000. At an annual economic growth rate of 3%, only half of the 365 000 youths entering the job market each year can be accommodated. It may therefore be expected that an annual figure of at least 180 000 young people could join the already more than 1 million unemployed. I might add that current unemployment statistics are believed to somewhat understate the position. Furthermore, these estimates are based on a 3% annual growth rate whereas, as we were told last week, only 1% was achieved in 1986. In fact, therefore, the position could be far worse than the one I have outlined. An analysis of job creation from 1950 to 1985—a period of some 35 years—shows that only from 1960 to 1970, when economic growth approximated 5,9%, did employment creation equal population growth.
The stark reality of these facts has frightening consequences for our country whether they be of an economic, social or political nature. However, I would argue that the complex challenge facing us is not merely a stark choice between achieving a just wage and higher employment. We have to seek a relative balance between equitable living wages, employment security, job creation and continued profitability. I believe this is an immense challenge, to say the least.
It is clear that the responsibility of meeting this challenge lies with both the public and the private sectors, and it is regrettable that a determined and co-ordinated response to unemployment and poverty does not exist in our country. Much has been done by both sectors to address this problem, but I believe it has not been nearly enough. If we do not address the problem head on, we are heading for an economic disaster.
A particular aspect I would like to deal with this afternoon is the position of the Black manager which is becoming increasingly untenable. I have chosen this issue in the firm belief that to succeed economically we have to make the best possible use of all our available human resources. If we do not develop a Black managerial class, we will never have sufficient managers to meet the needs of our country. It is, therefore, imperative that we create the environment in which Black managers can flourish.
In this context, I wish to deal with two issues. The first is the relationship between a father’s status and his son’s upward mobility. While not purporting to be completely accurate, the following estimates by Dr Linda Human of the UCT Graduate School of Business are believed to approximate the truth. A man from a working class home has about one chance in 1 500 of getting into Who’s Who; the man from a white-collar background has, perhaps, one chance in 500; the man from the higher professional or managerial home has one chance in 200; but the man from an elite home has a one-in-five chance. Silver spoons continue to be distributed, particularly in the South African context.
The second issue I would like to deal with concerns the fringe or marginal position of the Black manager. He has to contend with educational and cultural differences and discrimination. The Black manager is a marginal man who has to function in a series of diverse, conflicting and often ambiguous environments. He is a person who stands on the boundary between two communities. He feels as though he exists in a no-man’s land, and he may express himself as not quite belonging.
The Black manager is often in an impossible situation. He is highly valued among his own people because of his education and achievements, but sometimes he is ostracised as a sell-out. His socio-economic background often leaves him socially out of place in the work environment, and such inconsistencies induce problems of insecurity and anxiety that are often aggravated by the fact that he as a Black manager is alone in a White-dominated managerial hierarchy.
Private and public bodies have introduced many techniques to deal with the management of their human resources. Such techniques include personnel practices, policies and procedures, job evaluation and assessment, on-the-job training and recognition agreements, among others. These are all very vital, but I believe that the problem of the marginal man has not been adequately addressed. One industrial relations consultant has described the problem as dealing with personnel issues that arise “beyond the factory gate”.
I believe that, in developing sufficient capable managers to meet our country’s requirements, this issue has to be addressed. The maximum utilisation of all our country’s human resources and the development of appropriate skills have been inhibited for too long. It is essential for all employers and employees to be directly exposed to each other. Ordinary needs, fears, aspirations and hopes need to be dealt with. I would encourage businessmen to consider this issue carefully, as it is in the business environment that contact occurs in a particularly meaningful way.
As a member of this House, I will contribute to these issues which I consider to be of fundamental importance to the future economic and social well-being of all South Africans.
Mr Chairman, I congratulate the hon member for Pinelands on his maiden speech. It was a very stout effort. As far as I was able to hear it was at a superior level to the average Prog speech. [Interjections.] It was the hon member’s first speech in this House and I may quite possibly now be delivering my last.
The hon the Minister of Finance must help me, and quickly. Inflation has me in its grip, like a bulldog with its teeth in my trousers. The more I struggle, the more my trousers tear. I have made gestures and returned my salary, but all to no avail. After every sacrifice I am worse off. The hon the Minister must hurry, because soon I shall be standing here naked, without any trousers. Then the dog will drop the torn trousers and get a grip on the flesh. [Interjections.]
An inflation rate of 20% per annum means that one’s savings or one’s pension will be virtually worthless in five years’ time. We must radically change the whole setup in our country, as well as our way of thinking. We must get out of the old British Empire psychosis that our products must be processed abroad. We must work and create prosperity—and do so immediately—by seeing to it that nothing leaves this country before it has been refined or processed into the end product. South Africa must give serious consideration to freezing its foreign debts. After all, everyone plays rough nowadays. We cannot permit ourselves to bleed to death owing to a misplaced feeling of honour.
The harder one works the more one pays; the more one saves the less one has. No wonder some people are already talking about reducing their production rather than increasing it. I am going to leave this place and the hon the Minister will in future have to get by without my advice. [Interjections.] I wish him every success in his difficult task.
After 22 years in the provincial council and this place I leave of my own free will, without regrets, contented and free from care. To the best of my ability I did my bit for my people. There are other hon members who do want to come back, but who will not make the grade on 6 May. I wish all candidates who are to stand in the coming election everything of the best. However I must admit that when I look at some candidates, I cannot but hold thumbs for my country.
†Mr Chairman, if you ask me what has made the duller moments in this Parliament bearable for me, my answer would be: Vanity. The misplaced vanity of certain members has always been a source of great amusement to me. I am not going to write down a whole page full of names. [Interjections.] On the other hand the sincerity of most other hon members has been an inspiration to me.
*Murder, death and violence are assuming frightening proportions in this country. Every day people are being murdered in their homes. Only two weeks ago my own aunt was murdered in her home in Port Elizabeth. There may be many causes for this dreadful phenomenon—and possibly the examples of violence on TV are among them. If it is true that TV violence plays a part in this then I would prefer my grandchildren rather than to see more lovescenes—even if they are daring—than this kind of violence on TV. [Interjections.] I know that this statement will make the hair of that great and holy guardian of morals, the hon member for Rissik, stand on end. Unfortunately he is not present, but the message may be conveyed to him—even had he been here it would in any event only have been in the flesh and not in spirit. I was never able to make out whether the fears of that hon member are ascribable to a lack of knowledge, so that his best man had to give him a “map” on his wedding day together with his wedding ring, or whether it in fact derives from such a comprehensive knowledge of these evils that it has left him in fear that one day they may explode like a bomb in him. [Interjections.] In any event, the lip service he pays in this regard does not represent the norm in this country.
†Hon members of the opposition parties must do a lot of soul-searching about their loyalties to their leaders. I, on the other hand, had during my term of office a Cape leader, a Prime Minister and now a State President to whom it was easy, a pleasure and an honour to give full loyalty and support. He is a tough leader who brooks no insubordination but who at the same time leads by example and harbours no grudges. He is the greatest Prime Minister and State President that this country has ever seen. [Interjections.] He has indeed enriched my political as well as my personal life. He will continue to have my allegiance and support for the rest of my life and he deserves nothing less from every balanced, right-thinking and patriotic South African. I want to thank the hon the State President for his leadership and comradeship.
*I should very much have liked to tell a few more such anecdotes and to have trodden on the toes of a few hon members who have asked for it, and talk a little politics with the Progs. However the Whips, in their wisdom, have limited me to seven minutes. What I do not, in my heart of hearts, say about them, is not worth saying. [Interjections.] Because my time has virtually expired and I have to leave all the other things unsaid I had better end by repeating that I leave here loyal to and content within my party. I shall undoubtedly often miss the good friends I have made here over the years whom I have learnt to appreciate. I also express my gratitude and bid farewell to the Press, the good friends and the pretty girls up there.
Mr Chairman, when one omits the humouristic and lighter comments of the hon member for East London North—I think we all enjoyed and appreciated them—and his sincerity when he took leave of us at the end, it is apparent that he levelled very serious criticism at the Government. I should like to associate myself with that aspect of his speech.
Under this Government—we have said this often in public and here in this House—it is only the Whites, of all the population groups, that have become impoverished. This is the consequence of the Government’s policy of the redistribution of revenue. It is succeeding in this object, and this is apparent for the umpteenth time from the graphic presentation in the latest edition of Die Afrikaner. The Whites contribute approximately 77% of the State revenue of this country, while only 38% of the Government expenditure is spent on them. On the other hand the Blacks contribute 15% of the State revenue while 45% of the Government expenditure is spent on them.
The first thing I want to tell the hon the Minister this afternoon is that the situation is in fact even worse than that. There are certain services which are being rendered to the Blacks on an agency basis, for example hospital services. When one includes these in the calculation, the figure received by the Blacks from State revenue is not 45%, but 56%. I now challenge the hon the Minister to tell me, here in this House or elsewhere, that this is a lie. I agree with the statements in this week’s Die Afrikaner. He says they are lies, I say he is a liar. He can do so if he wants to, but I would appreciate it if he would say it in public in front of witnesses. He is very welcome to do so; I challenge him to do so this afternoon.
I want to give the hon the Minister our solution to the situation. The HNP standpoint—it was stated in Die Afrikaner last year—is that legislation should be passed compelling the Government to refrain from spending more on any population group than that group contributes in the form of tax. In the coming election campaign, therefore, we will convey these facts from one platform to another and in one pamphlet after another. We shall state our standpoint to the public. We challenge the hon the Minister once again, if he has the courage, to come and tell me personally that our information is a lie. Our economic committee, which is under very competent direction, worked through these particulars. I challenge the hon the Minister to say that they are lies. [Interjections.]
Mr Chairman, may I put a question to the hon member?
No, Mr Chairman, I only have ten minutes.
In his speech during the no-confidence debate the hon the Minister said that the Government was getting its priorities straight as far as expenditure was concerned. In the first place, I now want to ask him why the priorities ever went astray. That hon Minister has been Minister of Finance since 1984, and now after having been in charge for three and a half years he is admitting that his priorities went astray. He said that he was now, with all the expert advice he was able to obtain, in the process of getting his priorities straight. The fact of the matter, however, is that he is not getting them straight. His priorities are wrong, and they will remain wrong as long as he sits in that bench.
For example it is the policy of this Government not to discriminate. There may be no discrimination. But the Government is discriminating against the Whites in the economic sphere. Soon, for example, White parents will have to pay R600 per annum per child for the education of White children. What do the Coloureds, the Indians and the Coloureds pay? How quiet that hon Minister is now! [Interjections.] It is discrimination against the Whites! [Interjections.] Surely we know that when this election is over, the Government is going to demand these amounts to pay for our education. I repeat that legislation should be passed to curb the Government.
In his speech during the no-confidence debate the hon the Minister also said that there had been a dramatic change in the administration of this country’s finances. But we see no indication in the economy of a dramatic change in the administration of the country’s finances. In budget after budget the hon Minister’s estimates have been out by billions of rands. He does not make an error of a few hundred million rands; he is not capable of drawing up a budget which is not out by billions of rands.
The hon the Minister bragged about his advisers here. I do not know who they are, but he must realise that he bears the sole responsibility. He can receive all kinds of advice from his advisers, but ultimately he is the person who is not able to draw up a budget year after year which is not billions of rands off target. In any country in the world in which Western standards are maintained he would have been dismissed by a prime minister or a state president long ago.
What is worse is the fact that his budgets are false. His budgets are false!
Order! I think the word “false” is too harsh. The hon member must withdraw it.
Very well, Mr Chairman, I withdraw the word “false” and I say that the hon the Minister’s budgets are not a correct version of matters. It is an incorrect reflection of the situation. [Interjections.] I want to give the hon the Minister only one example. For approximately the past two and a half years a loss of R2,5 billion has been suffered as a result of forex. As a result of forex and the non-policy of the Reserve Bank a loss of R2,5 billion has been suffered which must in the end be recovered from the taxpayers. Why does that hon Minister’s budget not reflect that fact? He is not telling the voters the whole truth.
Repeat what you said.
I shall tell the hon the Minister again. During the past two to two and a half years, there is an amount of R2,5 billion which the hon the Minister did not account for in his Budget. This amount represents forex losses which the Reserve Bank accumulated as a result of its non-policy, and for which the taxpayer will be held liable.
What is forex?
It stands for “foreign exchange”. I only have ten minutes in which to speak and therefore I cannot teach him what he ought to know now. The poor numskull (“klipsteen”) must surely know what forex is! He must not ask me what it is.
Order! The hon member must withdraw the word “numskull”.
I mean “the poor Minister”, Mr Chairman.
Order! The hon member must withdraw the word “numskull”. [Interjections.]
Let me then refer to “the Minister concerned”, Mr Chairman.
Order! The hon member must first withdraw that word.
I withdraw it, Mr Chairman. I shall then refer to “the Minister concerned”.
That I can see no dramatic change in the country’s administration appears from the fact that the hon Minister concerned cannot predict the gross domestic product correctly to save his life. Year after year his prediction is wrong. It is not only slightly wrong. He has repeatedly predicted a 3% inscrease in the GDP. But that is mere propaganda. It is an expectation and an idle dream, which come to absolutely nothing every time. Last year there was a severe negative GDP. Now we do at least want to know from the hon the Minister how he can come and tell us that he is in control of the situation if there was severe negative growth in the GDP last year, and the growth this year is going to be only approximately 0,8%. In spite of the advice the hon the Minister is receiving, he is not able to give us even a reasonably correct prediction year after year. It is because he is not competent to do this work.
During the past few years we have been plunged into the worst economic crisis South Africa has ever experienced. The hon member for East London North has already indicated, in a striking manner, what inflation is doing to him personally. It was very striking, but I want to quote another example. If one regards the 1970 rand value as 100 cents, it was 64 cents in 1975 and at present it is only worth 21 cents. What a terrible testimonial that is for an hon Minister of Finance that he has done that to South Africa.
My time has expired. [Interjections.] I want to emphasise, however, that that hon Minister is going to cost the NP hundreds of thousands of votes during the coming election.
Mr Chairman, I should like to ask the hon member for Sasolburg what HNP stands for. I shall then read to him from Beeld of 23 April 1981. In the report “Waarvoor staan HNP?”, Mr Ferdinand van Heerden, the NP candidate in De Aar for the House of Assembly was quoted as saying:
He then gave the following reasons for his statement:
I can say the same about the hon member for Sasolburg’s unfair attack in his speech this afternoon.
I now want to ask him whether the so-called rightist groups, the CP and the HNP, are to co-operate in the coming election or not. It hardly makes a difference as we shall analyse their true character and style. This will be an easy task as we shall not do it through our words but on the basis of what they say and think about each other. [Interjections.]
Who or what are these rightist groups? I should like to quote an authority who typified the rightist groups briefly, vigorously and pithily by listing five characteristics. He said:
The authority who said this is the leader of the CP, the hon member for Waterberg. [Interjections.] What does the hon member for Waterberg have to say about HNP policy? At Komga in 1981 (Beeld, 14 April 1981) he said:
Does the hon member for Sasolburg agree with that? I want to quote a further authority—the Deputy Leader of the CP, the hon member for Lichtenburg. He said (Beeld, 21 April 1981):
[Interjections.] Does the hon member for Sasolburg agree with what the hon member for Lichtenburg said? The latter then continued:
That was 6 April—
[Interjections.]
I should like to ask why the hon member for Lichtenburg and the CP do not do what Dr Verwoerd requested of them. When he was Prime Minister, Dr Verwoerd asked us not to speak of “kaffers” but of “natives”. The term later became “Black people”. I want to quote another pronouncement by an authority. The Afrikaner of 9 March 1983 carried the following report:
[Interjections.] Mr Jaap Marais then continued—
Most important is what the HNP now has to say about the CP.
They are courting one another.
What are they saying about each other? I wish to present only one quotation to hon members. It is from Die Afrikaner of 6 October 1982, from a report headlined “Misnoeë oor misleidende Propaganda—KP se pamflet skok in Parys” and ran:
Mr Jaap Marais then continued:
He said:
[Interjections.] Sir, the hon members for Rissik, Pietersburg, Kuruman and Koedoespoort in particular are so fond of quoting what Adv Strijdom, Dr Verwoerd or Adv Vorster said. The other day they said that the essence of their policy was partition, but are they unaware that 31 years ago, on 17 January 1956, Adv Strijdom called that policy unrealistic and impractical? I quote (Hansard, Vol 90, col 43):
He continued and said they should apply a practicable policy. He added:
You are conducting a smear campaign. [Interjections.]
Sir, I agree 100%. I am conducting a smear campaign; I am quoting what the two leaders of the CP and the HNP say to each other. This is not what I am saying; they are the ones who say these things to each other. They should admit to each other that they are conducting a smear campaign.
They are maligning each other!
The hon member for Waterberg himself once said it was true that one obtained a better perspective on a situation in the course of time and that the necessary adjustments should be effected when the situation changed. From the same reliable source, The Afrikaner he said on 6 October 1982:
The CP and the HNP are perpetually accusing us of deviating from principles. Nevertheless it is a fact that we cannot remain static at 1652 or 1836 or 1910 or 1948 or 1961. We cannot even stand still at 1983. We have a choice between the stagnation or retrogression of civilization, and the progress of civilization. In certain periods of history one has certain ideals and, when those times change, one may also change one’s ideals. That is why our ideal today is one of co-operative coexistence.
Furthermore, it is also a fact that we celebrated with those hon members in 1968— nearly 20 years ago. On that occasion we published a book with the title 1948-1968: En Nou die Toekoms. It dealt with the achievements of the National Party. On page 73 we said:
That is why I say we are striving for the ideal of co-operative coexistence today. In a year or two we may develop a new concept of that policy again.
In a nutshell, there is a radical difference in point of departure between the opposition parties and ourselves. The PFP stands for taking Black rights to the absolute. The HNP, the CP and other rightist groups stand for taking White rights to the absolute. The National Party, however, stands for the stamp …
For the destruction of the White man!
… bearing the legal character of a state and of a political party, which is that it has to govern in the interests of all—White, Black and Coloured. [Interjections.] The National Party stands for this.
You are a Free State jingo! [Interjections.]
Order!
Because the opposition parties do not recognise this legal stamp …
Mr Chairman, on a point of order: The hon member for Kuruman referred to the hon member for Bloemfontein East as a Free State jingo.
Order! The hon member for Kuruman must withdraw that.
I called the hon member a Free State jingo.
Order! The hon member for Kuruman must withdraw that remark.
But, Sir, is it unparliamentary?
Order! My ruling is that the hon member must withdraw that remark.
I withdraw it, Sir.
Order! The hon member for Bloemfontein East may proceed.
Mr Chairman, because the opposition parties in this House do not take reality into account, do not take cognisance of the character of the state context, the voters will square accounts with them this year on 6 May.
Mr Chairman, it is always interesting to listen to the speeches made by the hon member for Bloemfontein East. His speeches are usually well-reasoned, and I enjoy his speeches very much, especially when he pitches into the right-wingers a bit. I find it interesting, therefore, to associate myself with the hon member for Bloemfontein East in this matter. In addition it is illuminating to observe the icy silence prevailing here between the CP and the HNP, while bloody fraternal strife is in progress outside.
In the latest letter written by Mr Jaap Marais to the hon the leader of the Conservative Party, he said that Dr Treurnicht had a split political personality. [Interjections.] Not a word has been said about that in the House, however. A deathly silence has prevailed. Yet one can sense the icy silence between the two mentioned parties. [Interjections.]
I should like to confine myself briefly to a subject which I believe is very important to South Africa. The UNO has eventually succeeded in getting the outside world to institute intensified sanctions and boycotts against South Africa. The hon member for Claremont is the representative of the PFP who encouraged and advocated the further application of sanctions against South Africa at their federal congress—along with the “Young Progs”. When he realised that a motion which had been moved by the “Young Progs” was not going to be carried, he pleaded for a sanctions campaign against the Nationalists in South Africa. [Interjections.] He is the PFP’s head of propaganda in this country. He is pleading for further and intensified sanctions against South Africa.
Let us look at the possible effect of sanctions on South Africa. Let us see what the hon member for Claremont is eventually advocating for South Africa. The first effect of sanctions …
What was the decision made by the congress?
… is that the inflation rate will increase further. The hon member for Bezuidenhout asked what the decision of the congress had been. Mercifully for him and for the hon member for Yeoville and other moderates in his party, that motion was voted down. That was a mercy for them. Just see who they have in their party, however, Sir. That is the important point. They have people in their party who are advocating sanctions against South Africa; people who are advocating intensifed sanctions against South Africa; people who are advocating intensified boycotts against South Africa. [Interjections.]
I am familiar with the decision of the congress!
Order!
Those people are playing right into the hands of the foreign countries. That is what the hon member for Claremont is occupying himself with, and, as I have said, he is the PFP’s head of propaganda. He is the man who is advocating further intensified sanctions against South Africa. He is also the man who, when he had to do his national service, managed in some or other way not to do so. When he had to do national service in South Africa, he was not here to do so. That is the man who is present in this House, but who, with the “Young Progs”, advocated intensified sanctions against South Africa at their congress.
One of the important results of sanctions is that it increases the inflation rate. The hon member would like a further increase in the inflation rate in South Africa. I shall tell you how this happens. In the first place we have to stockpile certain strategic supplies of products in South Africa, oil inter alia. That means money, dead money, just lying there. It is sterilised money which is not working, which means that if it were not necessary for that purpose, it could be used for other purposes, for example to stimulate the economy or for whatever other purpose. The inflation rate is increased in this way. Where imports and exports are concerned, we have to make use in many cases of a middleman, a procedure which causes a further increase for South Africa in the price of import products and the expense involved in export products. That is what the hon member for Claremont is advocating in this connection, however.
Mr Chairman, on a point of order: Is it the custom of this House for an hon member to be attacked if he has not yet made his maiden speech and is unable to defend himself until he has made that speech?
I want to point out to the hon member that the hon member for Claremont has not yet made his maiden speech. At this stage I think it would be advisable if he did not continue in that vein.
Mr Chairman, I apologise.
The second result of sanctions and boycotts is that it increases the problem of unemployment. Sanctions retard further economic development and growth in this country.
I believe we should not broadcast the methods the Government is using to reverse the effect of sanctions to our advantage, because then our enemies will know what the methods are. I believe that by means of replacing imports and promoting exports through the improvement of our export products, we shall eventually succeed in turning sanctions and boycotts to South Africa’s advantage, even if they will be to our detriment in the short term, as I have pointed out. This must be done. This Government has decided to accept the challenge and eventually to turn it to South Africa’s advantage.
The important question that must be asked is: Why the outside world applying sanctions to South Africa? The outside world wants to force a Black majority government on South Africa. The outside world wants to shove the model of one man, one vote in a unitary state—that is PFP policy—down our throats. This Government has had no choice but to tell the outside world to go ahead and apply sanctions and boycotts against South Africa, because we cannot afford to have a Black majority government in this country. We cannot accept Black domination in this country, just as we cannot accept White domination. The Whites of this country will not tolerate that.
We have launched information campaigns in foreign countries to ensure that the foreign governments are informed on what we are doing in South Africa. We shall continue in future to inform individual friends of South Africa on methods we are using to broaden democracy.
Order! There are hon members who are giving running commentary. To avoid my mentioning them by name, they must stop doing so. The hon member may proceed.
The electorate has an extremely important decision to make on 6 May. The action of the Government is not to accept any further interference from foreign countries in our internal policy, not to permit that to be shoved down our throats, and to accept sanctions and boycotts rather than a Black majority government. If certain voters are opposed to this, they must vote either for the PFP—the party which advocates sanctions and boycotts—or they can vote against the Government and bring out their votes for the CP, the HNP or the NRP.
Mr Chairman, I am rather surprised at the bad manners shown by the hon member Dr Odendaal in attacking another member of this House when he does not have an opportunity to defend himself.
A noteworthy thing this afternoon has been the lengths to which speakers on that side of the House have gone to avoid talking about the economic mess in which this Government has put the country. We heard the hon member Dr Odendaal talk about sanctions, and I can recall very clearly how, in this House last week, the hon the Minister of Foreign Affairs thanked this party for the efforts we had made here and overseas to try to prevent sanctions.
Then of course we had the speech of the hon member for Pretoria Central. Now that was one of the best red herrings I have ever come across in my entire life—trying to bring the ANC into a financial debate! I think the hon member should contemplate two things— first of all, that the main problems facing this country emanate from inside the country; and, secondly, that the main issues are the economic situation and the question whether we are going to have reform or not. While we are about it, I think that hon member should actually contemplate the fact that many of the problems we are facing relate to the policies which he and his Government have implemented over the past 40 years. They play into the hands of the ANC more than anybody else does. In fact, if the ANC had paid someone to promote their cause in this country, they could not have done better than that Government is doing right now.
You are making excuses for the ANC.
All politicians—and the hon the Minister knows this—operate in two marketplaces, namely the political marketplace where we have political parties selling their policies to the voters who are their buyers, using votes as currency and, of course, the economic marketplace where we have buyers and sellers of goods and services, and the currency is obviously money. I think most politicians around the world would try to align the objectives which exist in both marketplaces.
I put it to the hon the Minister that reasonable economic objectives could be, for example, growth to obtain the jobs which we need. Another economic objective can be low inflation in order to protect and encourage savings and to protect our competitive position. A further objective is, of course, to provide stability because without stability one cannot have the other two. In most countries politicians can easily align these economic objectives with the objectives they have set themselves in the political marketplace.
I want to argue today that the pursuit of political objectives in this country has been largely at the expense of sound economic practice. I want to give a few examples. Unfortunately time does not allow me to elaborate and cover the whole field, but let us look at a few aspects. Firstly we have pandered for years and years to different pressure groups in order to get their votes. As a result of this we have a range of administered prices in this country which is actually second to none. Quite often, when one looks at the statistics, one will find that administered price increases are ahead of the producer price index.
Next let us look at the ideology of separate development and take one item under that heading. By and large the decentralization policies—my hon colleague from Greytown will deal with this subject tomorrow—have been an economic disaster. There has been a large misallocation of resources and a misappropriation of funds to actually finance these projects. I am sure that one day when somebody sits down to do a proper benefit cost analysis of this scheme, the whole thing will prove to be at a vast expense to our country.
Then there is the shortage of skilled manpower due to the lack of the provision of adequate educational facilities for other groups, as well as to restrictions placed on them in terms of their mobility and places where they can open businesses. A fourth example is wasteful, unproductive expenditure. My hon colleague from Edenvale today spoke about the mushrooming of the public-service and the duplication and multiplication of departments in many cases. It is no wonder that, whereas the Government spent some 20% of the GNP in 1971, it is now spending something in the region of 30%. All this ideological abuse of our economy has come at a cost. It must come at a cost, for one cannot inflict that kind of punishment without a reaction.
We can see what is happening. Firstly, inflation remains at 15% to 18%. Secondly, there is the question of bracket creep to which the hon the Minister referred in his speech today. I should like to highlight this. In 1972 someone earning R10 000 would pay 14,2% of his income in tax. In 1984 the equivalent earnings amounted to R41 000, and that person was then paying 30,9% of his income in tax.
Thirdly, what has happened to savings? During the early seventies people saved some 10% of their income. Now the figure is down to less than 3% as people reduce savings to maintain their current standard of living.
Fourthly, let us look at the tax burden. My colleague, the hon member for Edenvale, mentioned this today, but I should also like to refer to it very briefly. During the 1980-81 tax year individuals paid 25% of the total tax revenue; now they are paying 36%. In 1980-81 GST amounted to only some 17% of the total tax revenue; now it amounts to 30%. In 1980-81 companies paid about the same tax as individuals; now individuals pay twice as much tax as companies. There has thus been a substantial shift in the tax burden.
Finally, hanging over this whole gloomy economic scenario, we have political unrest, political instability and violence. Polarisation is taking place in our society. We have no vision. We sat here for the whole of last week and nobody spelt out clearly where they would like to see in the country, say, five years’ time or ten years’ time or even one year’s time. We have no vision, and that is why we have uncertainty. People want some vision, something they can work for, something that gives them hope.
There is one thing we can say from these benches with certainty, and that is that this country will not grow and develop as it should as long as we place ideology above sound economic sense. I know the hon the Minister is going to stand up and accuse me of being negative and of making a very negative speech. Still, I can give one glimmer of hope to this country, and that is that if we South Africans want to turn the corner, we have to get rid of the apartheid ideology. If we do not do that, none of the problems I mentioned today will be resolved and the situation will not improve.
In the past many people thought the Government could be persuaded to do that. That is actually why so many people supported the Government in the past; They hoped the Government would actually implement the necessary changes. Last week again showed us, however, that it is not going to be done. The only way we can bring about the improvement we need is to get rid of this Government.
One thing is clear, and that is that if South Africans want continued inflation, they must carry on voting for this Government. If they want continued unrest that breeds uncertainty, they must carry on voting for this Government. If they want increasing polarisation where the middle ground gets eaten away and both sides end up in a conflict situation, they must carry on voting for this Government.
The voters in this country are learning a hard lesson. In fact, most of them have learnt that hard lesson and are beginning to take a long, hard rethink. Unfortunately, some of them are going to have to be hurt more before they learn that lesson. If they carry on voting for this Government and this hon Minister of Finance they are going to be hurt more until they learn that lesson.
I think the message in the coming election is very clear: If we want to turn the corner in our country we have to get rid of this Government. Only then will this country begin a process of reconciliation and reconstruction which can make this country great in this part of the world.
For those reasons, then, I support the amendment moved by the hon member for Yeoville.
Mr Chairman, the previous speaker once again came up with a long list of complaints. The opposition speakers criticised the hon the Minister again this afternoon. They are entitled to do so.
I want to say that the conduct of the hon member for Sasolburg is such that no decent person could approve of his style. I really think that it was a typical HNP speech. I even think that our two friends of the CP will concede that this was the case.
Order! Hon members must not converse so loudly across the floor of this House.
I want to thank the hon the Minister for the exceptional way in which he performs his task. We know that there is sometimes vehement criticism, even from people who ought to know better. I think he performed an exceptional task in very difficult circumstances. If one analyses what opposition members said in the no-confidence debate it is very clear that they have no practical, workable solution for South Africa.
Furthermore it has been suggested in some of the journals of opposition parties, but in this debate as well, that there is a political significance in the large number of NP members of Parliament who are retiring. I wish to refute this statement. As far as I know, these members are retiring for personal reasons. I do not think that any of us who will be leaving this House are doing so because we have any reservations about the NP or the leadership of the NP. If I remember correctly, in 1981—when this Parliament was elected— there were more new members on the NP side than are retiring now. It is purely a fabrication that these members are retiring because they are dissatisfied with the NP.
On the one hand the NP is being presented as the liberal reform party. On the other, however, the NP is being depicted as the recalcitrant apartheid government—as the hon member for Pietermaritzburg South has just said. [Interjections.]
He wants to link all the problems in the country to the policy of the NP. The PFP tries to present itself as the champion of the people of colour. However the hon member will be disillusioned when he realises that the people do not trust him because he says certain things but in practice he is not prepared to implement them.
What was the attitude of the PFP and some of the large city councils to the regional services councils? They said bluntly: “We do not want to pay for those towns for people of colour that need funds.” PFP members say things that they are not prepared to implement in practice. People of colour realise that it is all just talk.
What does Mr Frank Martin—a former MEC and a good friend of mine—say? I have a high regard for him. I worked with him for years. He is a big NRP supporter—one of the cronies of the PFP. What does he say about a bill of human rights? According to him the Whites in this country must sacrifice everything. That is the philosophy of the PFP. Throw in the towel—the sooner, the better. That is precisely what he said. What does he say in the South Africa Foundation News? He states:
He has the following to say in regard to a bill of rights.
On the issue of group rights Mr Martin said they could not be protected on the basis of race.
That is correct.
Very well, that is why they are friends; that is why they joined. [Interjections.] The NP has now accepted the PFP’s policy in every detail. It seems to me that the CP has now also accepted the HNP policy, but now there is some disagreement.
The NRP are adopted Progs. [Interjections.]
The majority of so-called ultra-conservative or right-wing people are those who have always lived in a protected world, particularly the world of the Afrikaner culture. There is nothing wrong with furthering or preserving one’s own culture, but they were lotus-eaters, who were unaware that there were also other people living in this country. [Interjections.]
I want to say to the hon member that a crony of his like Prof Boshoff simply cannot assimilate the fact that there is no exclusive Afrikaner heaven. He simply cannot accept that. [Interjections.] What does he say? To what conclusion does he come? He says that if we cannot have our own Afrikaner or White fatherland, then we had better throw everything overboard. Then we had better give up and accept the PFP policy. That is exactly how he put it.
What does “broer” De Lange say?
That is escapist politics, and in fact he has no solution. That is exactly what is happening to him. That is why he says that if we cannot establish a father-land that is exclusive to White South Africans then there is no salvation for us. [Interjections.]
Mr Chairman, may I ask the hon member a question?
I shall accept a question if only it is an intelligent one, Sir.
If the Tswana people can have a fatherland of their own, why can the Whites not have the same right? [Interjections.]
That is a typical CP question. It is theoretical. The hon member knows what the NP’s policy in this regard is. It is very clear, and it is unnecessary for me to expound it again here. I have a minute left for my speech and I cannot reply in detail on that now.
I want to refer briefly to the Press, and particularly some of the English language newspapers. When someone differs with the NP and leaves the party—I do not say this with malice, because I even have respect for our friends who are now seeking pastures new—then it is very strange that they are then praised. Such newspapers do not see the merits and the particular characteristics of those people while they are members of the NP, but the moment they leave the NP they are elevated to an exceptional level. [Interjections.]
My time has really expired, but I should like to conclude with the following. I sometimes wonder what the approach of these newspapers would have been if the Government had consisted only of English speaking people today. I must just add that I have no objection whatsoever to English speaking people; indeed, we have a good relationship.
That’s very liberal of you!
Would they still be as bitter towards the Government as the Cape Times and other newspapers are at the moment? I ascribe their attitude to the fact that in those ranks there are still people who maintain the old hatred of Afrikaners, and it is a pity that that is the case. We in this country ought to have better co-operation among the various language groups. That is really necessary and I think that those newspapers are doing this country a disservice by persisting in that attitude and that bitterness which they have maintained over the years.
Finally I also just wish to say that it was a privilege for me to represent my constituency over the past few years. I believe that everything will go well in this election and that everything will go well with the country because there will be an even stronger government than there has been up to now.
Mr Chairman, I should like to exchange a few ideas about what the hon the leader of the CP said during the no-confidence debate, although unfortunately he is not present.
Could you not have asked him to be present?[Interjections.]
That hon member should be quiet now and listen until I have finished.
It has to do with the decision by the synod of the DR Church.
[Inaudible.]
Order!
I am not a member of that church, but I hope that at some time or another I shall be able to join a Christian church. [Interjections.] The hon the leader of the CP is a theologian and we have great respect for that. Accordingly I do not wish to pick a fight with him in that sphere. However there are a few basic facts that I, as a believing Christian, want to talk to him about. [Interjections.]
Order! Too many interjections are being made. This will now cease. The hon member may proceed.
The hon member issued certain challenges and if I am not mistaken, one of them was that anyone could share a platform with him to debate the synod decisions and what they entailed. I find it tragic that that subject should be debated on a political platform.
Leave us “gaatjieponners” alone.
If that hon member would only begin by becoming a Christian, then that would help a great deal.
Just leave us “gaatjieponners” alone.
Order! I made an appeal to hon members not to make so many interjections. I am now making a special appeal to the hon member for Kuruman. The hon member may proceed.
To drag religion into politics in that way is not responsible. In recent times it has begun to seem as if religion has become a subject for the political platform. After the synod decision, various people entered the debate. I should like to refer to certain speeches and letters which appeared in the newspaper in Middelburg. Mr Eugène Terre’Blanche is reported to have discussed things that we can share in South Africa, and he is reported also to have said:
Is it not enough to make your blood run cold that anyone should say that he does not want to share his God? The report goes on:
Hon members must listen carefully to what he went on to say in addressing Dr Heyns:
This poor speaker is unaware that Totius’s church took the same decision 25 years ago and that Totius’s church was the only one that had one national synod! It is laughable.
In addition, a letter appeared in the same newspaper in which someone said:
“Satan en sy trawante juig”!
In recent times I have encountered the phenomenon in my constituency that people resort to various scriptures in an effort to prove that the Black man has no soul. At this point my intellect stops short, and those people must help me. Some decades ago our forefathers boasted that a White nation came into being in South Africa in order to spread the gospel here. How, then, is it possible that a nation could have been established to preach the Gospel to those whom some people regard as creatures (“goed”) because they are supposedly not people with souls?
I wish to state very clearly that I am in favour of separate churches for the various communities because I think it is in the interests of good order. However the people who condemn joint worship on the basis of the Scriptures forget that there is also a diversity in communality. Who are we to select what suits us from the Word of God? We must always ask ourselves whether we are still bound by the Scriptures.
All the Synod did was to make a pronouncement on biblical grounds. After all, we cannot close the doors opened by God’s Words. If we obey the Word of God and fulfil our calling, then we can pray to God for his mercy for the future of our country and our people. After all, we must not be so ridiculous as to suggest that heaven is reserved for us alone. Thank God for fine people, for Christians, who are found among all peoples and who form part of the multitude of God’s elect.
I should like to say a few words about my retirement. For everyone there is a time to come and a come to go and for me that time has come. It was a privilege to be able to represent the constituency of Middelburg, first in the Provincial Council and then in the House of Assembly. I am proud of having been able to serve the NP for 47 years, 16 of those years as its representative. At the same I have had a full and busy life of public service. I now take pleasure in making way for a younger man. I, more than anyone else, am aware of my shortcomings, but despite that it was a great privilege for me to be able to serve my church and community. I am profoundly grateful to everyone who made this possible for me. Hon members are aware that it was not always so easy for me. In any event it was a tremendous privilege to be able to serve my community for so many years. My thanks for that go in the first place to my Creator, but also to the hon members, to all my colleagues on both sides of this House, the staff and all the officials of Parliament and the voters and the community of Middelburg.
Now, at the end of my political career, I retire contented, in the unwavering faith that it may be granted to the NP to guide this country and its people to great prosperity and peace. I am happy to relinquish my seat in this House to a young man with the gifts and talents to represent Middelburg with honour. On 6 May we shall be sending Mr Dries Terblanche to Parliament with full confidence, and after that I shall be saying farewell. [Interjections.]
Mr Chairman, it is rather a pity to hear the last words in this House of the hon member for Middelburg this afternoon. On behalf of the hon members on this side of the House I want to wish him everything of the best. May he find the commitments that he will concern himself with—we hope that he will concern himself with certain commitments and not simply do nothing—and always have good memories of this House.
†Mr Chairman, I should like to comment briefly on some remarks that were made by the hon member for Cape Town Gardens on Friday. I must apologize to the hon members of that party for not having had the opportunity to inform that hon member in time that I would like to refer to his speech, with the result that he is unfortunately not here this afternoon. I am referring to what he said when he replied to the hon the Deputy Minister of Foreign Affairs on Friday. He said he was concerned that, after 39 years, the hon the Deputy Minister had to be so concerned about communism in South Africa because, after all, the Government had created the conditions causing this concern. If, according to the hon member, they had achieved even reasonable success during those years, there should not have been a need for that concern at all.
Somewhat later he referred to the Government’s concern about the ANC and to remarks made by the hon the State President. The hon member said:
Sir, I should like to submit to the hon member that it is clear that he has already been indoctrinated by the international media and by the local English-language media. Having to listen to that kind of remark being expressed by hon members of the PFP is a shocking experience.
*If we take a look at the alliances this party has with organisations that are linked to and appear in the organogram of the communist network throughout the world …
Mr Chairman, on a point of order: Is the hon member entitled to say that the PFP have alliances— which we have not—with organisations which are coupled to the communistic network? [Interjections.]
Order! I am not quite sure what the hon member for Caledon means by “alliances”. Will he tell me what he means?
Mr Chairman, if the words “alliance” perhaps implies too strong a link then I want to withdraw that word and replace it by “standpoint” and “sympathy” that they have with left-wing organisations that form part of the organogram of the communist network world-wide. [Interjections.]
Mr Chairman, on a further point of order …
Order! The hon member has withdrawn that word. I find nothing unparliamentary in what the hon member has just said.
It is time to adjourn the House.
In accordance with Standing Order No 19, the House adjourned at