laid upon the Table:

1. (1) (a) Part Appropriation Bill (House of Assembly) [B 46-87 (HA)]— (Minister of the Budget and Welfare).
2. (b) Certificate by the State President in terms of section 31 of the Constitution, 1983, that the Bill deals with matters which are own affairs of the House of Assembly.
3. (2) Additional Appropriation Bill [B 50— 87 (GA)]—(Minister of Finance).

Mr Speaker, I move:

Agreed to.

as Chairman, presented the Second Report of the Standing Select Committee on Finance, dated 12 February 1987, as follows:

[B 45-87 (GA)].

Bill to be read a second time.

Mr Speaker, before the debate adjourned last Thursday, I was dealing with the contribution made by the hon member for Port Elizabeth Central to the discussion of the measure in question.

†Sir, I must say I find it quite remarkable that the chief spokesman on transport of the Official Opposition never has anything good to say about the SA Transport Services. I believe, too, one is entitled to ask: Why this clear animosity? He suggested that the SATS had acted for years contrary to the real interests of the transport industry in South Africa.

In the SATS budget debate last year the hon member referred to the SA Transport Services as an institution which practised sheltered employment. This year the hon member says that the public of this country were overcharged. Now we have this considerable surplus of R139 million. However, the hon member appears to be completely ignoring the accumulated loss of approximately R600 million. We all realise that the SATS have suffered losses, especially in the transport of goods and passengers. We all realise that out of necessity it has to operate certain lines that are uneconomic.

However, the hon member ascribes everything to apartheid—and it is not the first time that he has done this. He says that Black people have to live far from the city centres and therefore we suffer financial losses. I repeat that we have never denied that we suffer losses in this regard, but at the same time we have never stopped pleading with the authorities to be adequately compensated for this service.

That is exactly what I said.

Financial losses are not only suffered in the case of Black passengers but also in the case of White passengers. We also realise that bus transport has to be subsidised.

For illogical reasons that hon member selects the sprawling Black townships as the main reason for these people having to be transported so far, thus resulting in losses. If no separate townships existed in South Africa, all urban and peri-urban areas would still have been connected by rail. I believe that trains would then have travelled the same distances, carrying Blacks and Whites; in other words, the same losses or perhaps even larger losses would have been suffered. So, the argument of that hon member is fallacious and intended to be mischievous.

Mr Speaker, may I ask the hon the Deputy Minister a question?

No, Sir, I am not replying to any questions at this stage.

*That is all he is trying to do. He is being wilful. I think his arguments are all wilful. Surely he knows, if one looks at the Cape Peninsula, that not only non-Whites make use of trains. There are Whites who have to come in daily from Wellington, Kraaifontein and even Worcester.

You can do better than that!

However, I can, of course, understand the hon member’s discomfort because this is a good part appropriation, and the hon the Minister is to be congratulated on his first success. I believe he has the reins of the SATS firmly in hand.

Since the start of the eighties the SATS has followed a policy of sharpening up its marketing methods and simultaneously cutting down on staff expenditure without reducing productivity. It is a known fact that with containerisation, centralised traffic control and mechanisation and automation plus, of course, improved management and better techniques and methods the SATS has undergone a complete metamorphosis. Trains have been running faster and deliveries have become quicker. Express services as well as clientele satisfaction have improved remarkably.

*The hon member is quoting something that Mr Koos Meyer said when he made a factual statement that the SATS had become faster. He is not trying to create the impression that this is the result of a high degree of improvement in the time schedules or the rapid delivery of goods. The hon member is creating the impression, however, that this is happening for the first time. I want to refer the hon member to page 23 of the report of the General Manager. The following appears under the heading “Fastfreight”:

The report of which year?

The last one that we had—1985-86. I quote from the report:

The report also makes mention of the new addition to the service—

And so forth. The report also mentions the PX minicontainers. The hon member says, however, that he welcomes the thought that for the first time R200 million will be spent in …

Order! Hon members are making it very difficult for the hon the Deputy Minister to speak, and for me to hear him. Hon members must lower their voices. The hon the Deputy Minister may proceed.

The hon member is trying to create the impression that this is the first time this has happened.

†I want to say, Sir, that what I have quoted here shows not only that the SATS have been continually on the ball but also that they have refined their systems—not for the first time!— for 1987. [Interjections.]

The hon member quite rightly welcomes privatisation and deregulation. I believe he supports us in our efforts. At the same time, however, he says that he does not want there to be any delays with their implementation. The hon the Minister made it quite plain that no system would be implemented if it would disrupt our economy. This is good common sense.

*It would be ridiculous, therefore, to ignore the prerequisites laid down for the application of this policy, because if these prerequisites are not adhered to, it could lead to a chaotic situation in the transport industry. The transport industry, including the SATS, should be able to prepare properly for deregulation. This is not something that can be done precipitately. Far-sightedness and planning are imperative in this respect.

The impression should not be created that every Tom, Dick and Harry can go and buy motor trucks and enter the transport industry. The Government cannot be irresponsible. Many interests have to be taken care of. Transport companies would also be wise not to act upon unfounded expectations. We know the old expression “more haste, less speed.” That remains true.

We say there will be reasonable opportunities for everyone—the SATS included. There are encouraging signs that the expected economic upswing is going to gain momentum.

Where are these signs?

This will be to the benefit of the SATS’ affairs.

The hon member asked me where these signs were. It looks as though the hon member for Sasolburg, who is so fond of newspaper cuttings, takes notice only of certain cuttings. If the hon member had read his newspapers during the weekend, however, he would have seen that there is an upswing in the tourist industry in South Africa. This will also have a good influence on our transport services. [Interjections.]

The availability of an additional R1 000 million to our economy, which has been announced by the hon the Minister of Finance, will also mean a great deal to the Transport Services. This moderate stimulation of our economy will be to the advantage of the Transport Services, because when there is vitality in the economy, we do good business, but during a cooling-off phase our expenses remain high and our income remains low.

Just get rid of the Government!

Once again we are being attacked by those hon members about the so-called discrimination against employees in the Transport Services. The hon members of the Official Opposition have been informed in detail on this situation, and they have the same information as we on this side of the House have. In short, the ideal of equal payment for equal work and for equal training and responsibility applies in the Transport Services as well.

That’s not true.

The conditions of service and salaries of the different population groups will be made equal to those of the Whites in five phases.

That is true.

The hon member knows it is true. Why then does he keep on trying either to pour cold water on the whole matter or to create the impression that we are not adhering to our programme?

Because there is still discrimination. You are still discriminating.

The hon member knows, however, that the first phase was begun in January 1984 and the second phase in April 1986.

What that hon member should also know— if he does not, I am telling him now—is that since January 1973, viz 11 years before these phases were introduced, the Transport Services has been narrowing the wage gap. This was even before the process of equalisation in phases had commenced.

But there is still discrimination.

The trade unions have no dispute with the management or with the hon the Minister concerning the matter. The hon member will also know that the total expected expenditure for full implementation is approximately R631 million. Parity is becoming an accomplished fact, therefore, but the hon member is trying to create the impression that we are not implementing, it. Instead of being grateful, he is trying to exploit an awkward issue to create the impression that relations between Whites and non-Whites in the SATS are not healthy. The hon member wants to upset those relations.

But there is still discrimination …

The SATS has succeeded as a result of the application of the following: Good management, good marketing, saving and cultivating professionalism among its employees. In this way it has succeeded in maintaining a level of productivity which, in my opinion, is unequalled.

The protection enjoyed by the SATS as the national conveyor through the years has been scaled down for a long time. The hon member maintains, however, that the SATS has initiated all the appeals of the local transportation boards to the National Transport Commission, but that is a false notion. Most of the appeals that are lodged are lodged by members of the private sector, who have constant vendettas against one another.

The hon the Minister has succeeded in keeping not only the employees of the SATS satisfied, but also its clients.

In the last place I want to refer to the hon member for Uitenhage. I want to thank the hon member for his friendly invitation for me to visit his constituency one of these days. It is a pleasure to accept the invitation, especially the workshops will be viewed there. At this stage I cannot respond freely to requests for assistance, however. Personal consideration will have to be given to the hon member’s requests first. Those of us who know the hon member for Uitenhage know, however, that his powers of persuasion are often difficult to resist. We shall have to see, therefore, what the future holds in store.

Mr Speaker, I must say the hon the Deputy Minister defends his line well and I congratulate him on his first speech as the Deputy Minister of Transport Affairs.

I also want to extend a word of welcome to the new Minister of Transport Affairs and wish him well in his post. He has a hard act to follow.

In the very short time available to me I should like to talk about flying and the SA Airways. I think everyone in this House will agree that the SAA has one of the proudest records in the world for safety and efficiency. I do not know about other people but I always get a good feeling when I stand on the balcony at Jan Smuts Airport and look down at the rows of aircraft representing various countries on the tarmac. I get a feeling of pride when I look at the livery of the SAA and the fleet that we own.

I agree that our airline, our national carrier, has been under tremendous pressure of late. Sanctions have been imposed against it and there is the problem of ever spiralling costs but I must say that the powers that be, in my opinion, have done their best in respect of their gymnastics with the timetabling. I think we are all grateful that fuel is not the factor that it was.

Internationally, therefore, I think we can all agree that SAA does not fall far short of the 100% mark. However, I want to say in all sincerity to the hon the Minister that something is going wrong in the domestic services; something is lacking. Our domestic services are no longer cheap. Ten years ago one could fly to London and back on what it costs today to fly to Johannesburg and back from Cape Town. I confess that the food has much improved, and that in their new uniforms the girls are a lot prettier. However, there is something wrong in the aircraft. The aircraft are getting a worn look. Of late, not on one occasion but on a few occasions, I have found on taking my seat on the aircraft that the seat has not been fixed properly to the aircraft; they are getting a run-down look. The seats are becoming harder although it may be argued of course that my seat is becoming harder. [Interjections.] That could well be but hon members can rest assured that I think the seats in our aircraft could do with a little refurbishing and padding.

It does, however, not end there. To my mind the most important thing lacking as far as our wonderful airline domestically is concerned is in regard to our baggage handling. Here something has really gone wrong. There was a time when one could go to one of our terminals—many hon members will be relieved to hear that I am not going to start making comparisons between Louis Botha Airport and D F Malan Airport because that is not part of the particular portfolio which is under discussion this afternoon—and in no time at all one’s baggage was on the conveyor belt and away one went. That does not happen any longer; one has to wait up to 20 minutes before the first case arrives. It happened only yesterday when I went to meet my good lady on flight SA 609 from Durban. We stood and we waited and waited and waited! I think where we are probably going wrong is that we do not have the facilities available on the apron when the aircraft arrives. I get the feeling that when the aircraft comes to a standstill the passengers have first to disembark before the little tractor and trollies make an appearance and trundle their way out across the apron to the aircraft to start offloading. We are not synchronising this properly—it is not planned properly. I believe there is room here for a great deal of improvement. We hear many complaints and a lot of muttering from people standing around waiting for their baggage. It is something that must be addressed urgently.

Finally, I wonder if we cannot do something about the safety announcements on board. I know Iata says that in terms of the safety regulations one must have the long speech that one gets concerning oxygen masks that will fall out of some place; that one is not allowed to smoke in certain sections; that one’s seat must be upright; that one must do this and must do that etc.

One sometimes finds a flight attendant who turns around and asks the passengers if they need to hear the announcements. Almost everybody will then shake their heads and say: “No, for heaven’s sake let’s not go through that again!” Even though it is called for I wonder if we cannot have a different approach to this.

I do not think it is entirely necessary. I can appreciate the fact that everybody thought this was important 30 years ago. However, it is now 1987 and flying has come to stay. I do not believe we need all that sort of thing.

With these few comments about the SAA may I just repeat that I still believe it is the finest airline in the world and I urge the SATS to keep it that way.

Mr Speaker, we on this side of the House would like to welcome the new hon Deputy Minister of Transport Affairs. We congratulate him on his appointment to this post and wish him well in the future in spite of the fact that he launched a very severe attack on us with which I intend to deal. We would also like to welcome the new hon Minister. He has a very difficult task in having to follow his predecessor who had a very good knowledge of the subject.

Before I start on my speech I want to make a complaint which I hope the staff of the SATS will take seriously. It concerns the question of the trains on the East and West Rand. The passenger commuter service there is creating a tremendous amount of trouble as it is always late. Many people working in Johannesburg are complaining bitterly about it. I wish they would investigate it and try to rectify the situation.

I would like to deal with one of the points raised by the hon the Minister, namely the question of the report of the Wiehahn Commission. Last year I introduced a motion to the effect that a commission should be established to investigate the feasibility of the appointment of an industrial council for the SATS. The whole system in terms of section 28 of the Conditions of Employment (South African Transport Services) Act, as consolidated in 1983, which allowed the establishment of a commission under the chairmanship of a judge, is absolutely outdated. The natural order of things is such that the trade union associations of the SATS are powerless to do anything. The reason for this is quite easy to understand, namely that the NP Government could silently compel them to vote for them so that they could ask for a little more from time to time.

However, if there is an industrial council, there is power-sharing. Each one has its own power and they share power with each other so that the demands of the SATS can be made and can be understood. I would like to know from the hon the Minister when he intends to institute the industrial council because, according to the rumours that I hear, the Wiehahn Commission has actually made it clear that it would be in favour of the formation of an industrial council. This would at least give the SATS employees, the people who work for the SA Airways, in the harbours and on the pipelines, the opportunity to be on an equal footing to negotiate, through their unions, their own conditions of service and their pay.

I raise this point in particular because I have been informed that the meeting between the new hon Minister and the trade unions of the SATS was an unmitigated disaster. In addition to that he has refused to see a delegation from the trade unions in connection with pay rises. If there is an industrial council all these particular problems will be solved and nothing like that will happen again. I hope the hon the Minister will see to the establishment of the industrial council as quickly as possible.

The situation that was revealed in the speech of the hon the Deputy Minister rather surprised me. Instead of having attacked the opposition parties, he should have launched his attack on the hon the Minister of Finance because the problems which have arisen as far as the SATS are concerned are not caused by the opposition; they are problems which this department has because the hon the Minister of Finance is not playing the game with the SATS.

We are not talking about a small company but about an organization that is one of the biggest corporations in South Africa. As at 31 March 1986 the capital value of the South African Railways was R11 billion. If depreciation is subtracted, it has a capital value of R8 billion. The capital value of the South African Airways is R1,3 billion and, less depreciation, R800 million; Harbours, R1,1 billion and, less depreciation of R300 000, R800 million. That of the pipelines is much less. We therefore have a company here that is worth in excess of R10 billion, and the way in which it has been treated is quite terrible.

That is one of the reasons why it has been necessary for the Railways to cross-subsidise. It had to do that in order to try to meet its obligations and to make up for losses suffered. In other words, instead of the State paying its fair share, it has been the problem of the Railways, the Harbours and the whole of the SATS organization to try to make up these terrible losses.

The 1986-87 Budget, for instance, shows that the Railways expected to lose R766 million: Harbours would make R301 million; South African Airways would lose approximately R79 million; and the pipelines would make about R180 million.

What has the situation actually been during the various financial years? The pipelines, for instance, showed a surplus of R146 million in 1982-3; in the following financial years R151 million and R171 million respectively; R180 million in 1985-86; and, in 1986-87, R187 million.

Does the hon the Minister know how the public of South Africa is really affected by the fact that this sort of cross-subsidization has to be applied by the SATS in order to try to make up the losses? I want to deal with that now.

According to the calculations by the Department of Mineral and Energy Affairs, for every R100 million additional revenue it is possible to reduce the price of petrol by 0,84 cents per litre. Therefore, if this amount of R187 million was available to the Oil Fund the following price reductions would be available to all motorists in South Africa: 1,55 cents per litre on the current price of petrol and 1,0 cents per litre on the price of diesel. That is the additional cost which every single motorist pays towards maintaining apartheid in commuter and passenger services on the Railways.

When it comes to privatization, my solution would be that the pipelines should become a public utility company operating on a non-profit basis, provided the State fulfils its obligation of open accountability for subsidies. That is where the hon the Minister of Finance and I have our problem in relation the widow Mrs Pienaar of Pofadder. He will know to what I am referring.

The situation arising as a result of this is the following. In 1986-87 the total loss that will be sustained by the SATS is estimated to be R1,1 billion. The passenger service compensation which the SATS will receive from the State and from other sources will amount to R758 million, which will leave a shortfall— which will have to be made up by way of cross-subsidization—of R342 million. Where does the State subsidy come from? First of all, R458 million is available through the waiving of interest on capital which the SATS have borrowed from the State. Instead of interest being paid on that amount payment of that interest is quietly being waived. This amounts to R458 million at present. The hon the Minister should not look at that as a present because that amount has to be made up by way of taxation in some other way.

That is not true!

It is true. If the hon the Minister of Finance does not recover that R458 million from the SATS he will have to get it by way of income from some other source. He must not tell me it is not true. He knows that if he does not get the interest to which he is entitled he will have to collect it elsewhere. This would not have been necessary had the said interest been paid as it should have been.

Furthermore there is a lump sum of R300 million given, and by way of cross-subsidisation the SATS gets the additional R342 million. I have estimated that if one should add the 20% inflation, this loss, by the year 1992, could be between R2 billion and R2,5 billion.

Where do these losses come from? Let me add right now that I agree with the hon the Deputy Minister when he states that money is not only lost on Black commuter services. Money is also lost on White commuter and White passenger services. The whole question of the subsidisation of passenger services is not being fully addressed by the State, and that is one of the basic reasons for these losses. It is the obligation of the Treasury to ensure that this is done.

When we look at the White Paper on National Transport Policy one of the first statements we read is the following, and I quote from page 3:

It is further stated, and I quote again:

These are the preconditions for the implementation of the recommendations contained in the White Paper. This White Paper is of no value whatsoever unless the preconditions are met, and the man who must meet those preconditions is the hon the Minister of Finance. For years each and every Minister of Finance has not been playing the game and has not been giving any money. Now they have suddenly decided that they will collect money via the regional services councils.

I do not understand how they can expect to get money from the regional services councils. People do not know what they will have to pay. There will be a turnover tax and there will be a payroll tax in addition to the other taxes that they pay. If they expect, as the hon member for Primrose said, to collect R800 million during the coming year, then the first R300 million is going to have to cover the present loss. However, there is another amount of R300 million, so R642 million has already to be found in order to ensure that there are no more uneconomic services or that the uneconomic services are paid for by the SATS.

Therefore R200 million is going to be left over for the whole of South Africa to run the regional service councils. By the time everybody has been paid their salaries there will be nothing left over for the improvement of townships and for providing more water and everything else that is needed. Unless the SATS comes to some arrangement at this stage with the hon the Minister of Finance, there is no future for the SATS. The whole question of privatization and the whole question of deregulation will become of no account whatsoever.

I would like to add a few remarks in this regard. As the hon the Minister said, in regard to the loss within the commuter services not only Blacks but also Whites are subsidised. It is estimated that 40% of the subsidy goes to first class passengers and 60% to third class passengers. Therefore, the subsidy to first class passengers is about R256 million and that for Black passengers is about R386 million. That is not to say that there are no Black passengers who travel first class, but when one looks at the average train on the Witwatersrand, one sees that there are usually 14 coaches of which two are first class and 12 are third class.

I would like to deal with the repayment of concessions. One of the things laid down in the White Paper is that concessions should be waived on both sides. Concessions are given to the State while the State owes concessions to the SATS. If this is done, the SATS will have to obtain another R60 million from the hon the Minister of Finance on the same basis.

Finally, I would like to deal with the question of open accountability, because this affects the hon the Minister of Finance. He must ensure that the SATS gets its money. Unless the hon the Minister of Transport Affairs is tough with him, he will get nowhere. They have done one thing already in this respect and that is the building of the Khayelitsha railway. The Khayelitsha railway is the system from Khayelitsha to Cape Town and has been built at the expense of the State. The State has had to provide R350 million to the SATS to build it and the State, according to the law, will be responsible for financing any losses. The loss for this year will be R75 million. The loss for next year will be R90 million. The loss for the year after will be R108 million. That is in addition to the other losses that are being sustained.

Unless the hon the Minister of Finance now decides to arrange the whole financial situation with the SATS, what is suggested in this White Paper cannot come into existence at all. Therefore, all the things that everybody has been trying to achieve over the past years in order to provide a national transport policy of some value, will be as nought unless the hon the Minister of Finances fixes this situation up right now.

Mr Speaker, last year R23 million was provided for regional services councils in the SATS budget. The other day the hon member for Primrose mentioned a figure of R800 million that must possibly be made available by the SATS to the regional services councils—multiracial local authorities which have to furnish certain services. There must be levies on regional settlement and regional services. I now want to ask the hon the Minister to spell out to us today how the SATS is going to make its contribution to regional services councils. Who is going to pay for that? Is it going to be those who make use of the SATS who will pay, or is the R800 million to subsidise this multiracial local authority going to be found in some other way?

I want to support the hon member for De Aar in his request to have the salaries of workers and the pensions of pensioners of the SATS increased as quickly as possible. The hon the Minister said he would address that issue after the election. We in the CP want to say that it is specifically the low-income and middle-income groups, and also the SATS pensioners, who are having difficulty keeping their heads above water.

Mr Speaker, may I put a question to the hon member?

No, Sir, I do not have much time.

I am asking the hon the Minister to address this matter as quickly as possible, even if it is prior to the election. They would perhaps not gain as many votes as they would want to, but they could save a lot of people who are, at the moment, living under very difficult circumstances in South Africa. [Interjections.]

I should also like to support the hon member for De Aar’s request to the hon the Minister to take a very serious look at the crowding out of Whites on SATS’s stations. The hon the Deputy Minister has just referred to an invitation he received to make a quick tour of the SATS workshops at Uiten hage with a view to seeing whether they could not possibly orientate those people towards voting for the NP on 6 May. I in turn want to invite the hon the Minister and the hon the Deputy Minister to visit a few stations here in the Cape Peninsula. I would specifically like them to go to Thornton station during peak hours and see how the Whites are being crowded out there by people of colour.

This crowding out, and the dangers that arise in the vicinity of the station, are so bad that even the hon member for Claremont—a PFP member who was satisfied to have the trains open to all, to have everyone walking through the same tunnels without separate subways—lodged a plea in this House about having a look at the safety of people in this situation.

Of everyone.

Yes, of everyone—safety for everyone. I want to say, however, that the clashes and the friction specifically arose after the SATS had done away with the measures designed to maintain separation at stations. That is why I earnestly ask the hon the Minister to listen to the hon member for De Aar’s request.

A matter about which the hon the Minister and I will probably agree and in which he will support me, I hope, is the extension of the Sishen-Saldanha railway line through Pudimoe to the Rand so as to establish an alternative route from a West-coast harbour to the Rand. I think the hon the Minister will agree with me when I say that this railway line runs through Namaqualand and the North-western Cape—the two areas which are the mineral treasure-house of South Africa. [Interjections.] As a result of the planning that took place at that time, in the past these areas have lagged behind, but I firmly believe that these two areas, the North-western Cape and Namaqualand, have the best potential for development in South Africa. I am asking the hon the Minister to make an announcement about this railway line and to proceed with its construction. The investigation has already been completed. In 1981 it was decided that the railway line would be built, and construction of the railway line was to have commenced in 1985. It is now 1987, and the Government is presenting the economic conditions in the country as an excuse for postponing the construction of this railway line. I am asking the hon the Minister to make an announcement about this; he could perhaps win a few votes in Kuruman. I am lodging a plea with the hon the Minister, for the sake of the Cape, to announce the construction of the railway line.

It could be that the construction of this railway line will not be beneficial to the SATS. The hon member for Bezuidenhout has just indicated, however, what the Khaye litsha railway line is costing the State and what the losses are. When we debated that, the losses on this railway line would have amounted to R20 million per year. This year they amount to R70 million, and the expectation is that after next year the losses on this railway line will be up to R100 million.

This railway line I am advocating will perhaps not be of benefit to the SATS at present, but it could establish a vital artery for the natural development of this area. In this way we shall also be able to decentralise the development to those areas. I want to make an urgent appeal to the hon the Minister to give very serious consideration to this matter. The people of the Cape are asking him: “Open up the North-western Cape and Namaqualand with the establishment with a vital artery; open this part of the world to development, because this part of the world— which is the mineral treasure-house of South Africa—deserves to be opened up.”

I now want to bring another matter to the hon the Minister’s attention. On 15 July 1986 a SATS bus left Kuruman for Kimberley. Bookings were accepted for both Whites and Coloureds to travel on this bus. When the bus was to have left, the Whites refused to travel with these Coloureds in the same locale. The result was that the Whites were transported by car from Kuruman to Kimberley. Upon arriving at Daniëlskuil the Whites, who had booked seats to Kimberley, found that there was a person of colour booked in with them. They, too, refused to travel with the person of colour. Again the result was that these people had to be transported to Kimberley by car. The upshot was that a Coloured travelled alone in the first-class bus to Kimberley, whilst two cars had to transport Whites to Kimberley.

The NP’s policy states that Whites have a choice about whether they want to travel with non-Whites or not. That is the NP’s policy, as announced by the previous Minister. If they are not prepared to do that, other arrangements must be made for them, as in this case. My question to the hon the Minister is now the following: Can the SATS afford to have three vehicles travelling to Kimberley on the same day for the purpose of transporting passengers?

Remember that the Whites pay more.

The answer to my question is that the SATS cannot afford the luxury of such an ambiguous NP policy.

The logical consequence of NP policy is that all South African citizens, regardless of race or colour, must receive equal treatment as far as travelling facilities are concerned; that they will simply have to travel together. I now want to ask the hon the Minister: Is he going to retain the “policy of choice,” or is he going to give the Whites only one choice— travel with the people of colour or make use of your own transport?

It is incidents such as this that cause offence and damage relations between peoples.

And Menlo Park.

Yes, the Menlo Park incident too. In the case of the Menlo Park incident the local school committee was told that it could decide what it wanted to do at the school. When it decided, however, that only Whites could participate at the school, the NP held it against the school committee and the matter became an international incident. [Interjections.] It is incidents such as these which, if they are blown up, as in the case of the decision taken by the Menlo Park management board, which does South African an infinate amount of harm abroad. [Interjections.] Let me tell that hon Deputy Minister that it is not the management board’s decisions that did South Africa unprecedented harm; it was the ambigious NP policy. Does the NP not tell the people in the rural areas that they can decide for themselves if they do not want mixed school sport? If that is their decision, however, it is made into an international incident and the NP puts the blame on the locals. The NP itself must accept the blame, because its policy, the “you want it, we have it” policy, is the cause. They themselves must therefore shoulder the blame.

I want to ask the hon the Minister to reintroduce separation in travelling facilities on the SATS. Separation prevents situations in which friction can develop, as on the bus from Kuruman to Kimberley. Separation prevents situations that could give rise to friction, for example that which took place at the sports meeting at Menlo Park. [Interjections.] Separation prevents humiliating situations such as that which took place there. Consistent separation prevents incidents that could do endless harm to South Africa abroad.

That is why I am asking the hon the Minister to spell this out for us today. Is he still going to give the Whites the choice if they want to travel alone in a coach, or is he now also going to throw the old NP policy in the trashcan? I want the hon the Minister to tell South Africa clearly, and prior to the election, where the Government is taking the country.

Mr Speaker, we have reached the end of this debate and I take pleasure in thanking all hon members who participated. I should also like to thank the hon members who congratulated the hon the Deputy Minister and me and wished us luck.

This was a reasonably comprehensive debate; the contributions regarding the White Paper on National Transport Policy were of especial interest. Further, I found it very interesting to note that there was practically general consensus on that White Paper; I did not hear a single hon member arguing against it.

In the first place I should also like to congratulate the hon the Deputy Minister on his appointment. He has my hearty thanks for the support I have already received from him and also for the valuable services rendered in the past and also at present as the Chairman of the Standing Committee on Transport Affairs. My thanks, too, for his services as chairman of the specific study group and also for his significant contribution here this afternoon. He certainly dealt effectively with the hon member for Port Elizabeth Central. That is an hon member who has developed an absolute obsession about petty political issues.

†The hon member moved as an amendment inter alia that—

The hon the Deputy Minister has, of course, already replied to the hon member. Allow me to reiterate, however, for the benefit of the hon member that the South African Transport Services—I say this also for the information of the hon member for Kuruman—is a business undertaking. Accordingly, the needs and preferences of individual clients as well as groups of clients must be duly addressed. The only proviso is that the SATS must not discriminate in the standard of the services they render. I repeat that the SATS is a business undertaking and must take cognizance of the preferences and needs of its individual clients as well as its groups of clients.

Do they have separate Boeings for Blacks? [Interjections.]

Having said that, however, I must add that South Africa is engaged in a process of reasonable reform.

Reasonable? [Interjections.]

That is right; reasonable reform.

That is a new one! [Interjections.]

Reasonable reform is evolutionary reform. [Interjections.] That is what reasonable reform is. The type of overnight reform which the hon member for Port Elizabeth Central is advocating would be absolutely disastrous. [Interjections.]

I say that South Africa is engaged in this process of reform. The situation is being continuously monitored by the SATS and adaptations are being made to suit changing requirements.

But Denis and Wynand are tired of that! [Interjections.]

In passing, I should just like to say that the hon member for Port Elizabeth Central is a White radical liberal. I think he will agree with that.

No, I do not agree that I am a radical and neither that I am a liberal. [Interjections.]

Furthermore, he is also a member of the clique to which an hon member has referred.

The Mafia!

Yes, he is a member of that radical clique as well. [Interjections.] They have just driven out one of their able politicians who has no problem with PFP policy. Why? It is because he is an Afrikaner, and he does not only pay lip service to his patriotism. That is why he was driven out by the radical clique of which the hon member for Port Elizabeth Central is a member. [Interjections.] So much for his sincerity as regards non-discrimination.

Are you raising the old “boerehaat” issue again? [Interjections.]

The hon member demands parity in remuneration for all races, and the hon the Deputy Minister has replied on that point. I now want to tell the hon member something else, namely that he can stop practising paternalism. We have direct channels for negotiating with all groups. What is more, I shall proceed from this House to the other two Houses and discuss this very issue directly with the other two groups. [Interjections.] This is all thanks to this tri cameral Parliament, and we have achieved a large measure of success in this new Parliament in building mutual confidence, which is a prerequisite for ultimate success.

Then why is there a state of emergency in the country? [Interjections.]

The hon member also demanded meaningful deregulation and privatisation. In terms of the steps that were announced in the mini-budget speech, the SATS are, in fact, ahead of the White Paper. The hon member’s amendment is therefore inappropriate. He was caught by surprise, and his footwork was too slow to adapt. Am I right?

No; once again you are wrong.

The hon member suggested that implementation should take place no later than the first quarter of next year. However, I can give the hon member the assurance that the SATS are ready to implement those conditions now, provided that certain preconditions are met. [Interjections.] Unless those preconditions are met, one being that private hauliers will have to make their due contribution to road maintenance and construction, and another the question of cross-subsidisation, there can be no fair competition in the market, and that would be to the detriment of the public and of the South African economy.

What is the hon the Minister of Finance going to do about it?

Until those preconditions are met, the SATS must, of course, protect its interests.

What arrangements have you made …

Order!

I shall say more about privatisation at a later stage.

The hon member for Port Elizabeth Central also referred to the matter of the efficiency of the SATS. In any business with status, efficiency is of ongoing concern, and that is the case in the SATS. The hon member could not come forward with any specific allegations of inefficiency. He simply made general statements. He said that the business of the SATS was operated to the disadvantage of the South African economy, and that we were throttling the private bus services. This is, of course, just so much nonsense.

He also pleaded that all road transportation be done privately. That is not possible because our clients are entitled to a door-to-door service and that entails the necessity of road transport as well as rail transport by the SATS. I think the hon member will grant me that.

I said that if there was a railage leg, by all means. It is in my speech, so read it.

I shall leave it at that and add a few words later on the question of privatisation.

My hearty thanks go to the hon member for Primrose for a well-considered contribution. He referred to the Wim de Villiers Report, to which I also alluded in my appropriation speech, and requested its tabling. In time I shall recommend to the Cabinet that this actually be done.

The hon member also referred to the importance of the strategic interests of the SATS and in the implementation of the new transport policy this will also be examined thoroughly later. The Wim de Villiers Report also addressed aviation, to which the hon member referred.

The hon member broached another very important aspect. He said we should first deregulate and then privatise. I wish to agree immediately. In truth, as far as the SATS is concerned, deregulation is the most important element of privatisation.

In addition to this, the hon member requested that we consider debating the White Paper in this House. This poses no problem to me and we can debate it under the Transport Vote during the appropriation debate and pursue it during the SATS Main Appropriation.

The hon member raised yet another important aspect, which is that we should not create monopolies in the process of deregulation and the institution of a new transport policy. I am in complete agreement with the hon member and shall refer to this again later.

PW should have appointed him as the Minister or at least Deputy Minister.

The hon member for De Aar, the chief CP spokesman on transport affairs, and the hon member for Kuruman requested that segregation measures and notices be retained and extended. That is a process of continuous adjustment based on demand and circumstances. Our clients’ needs are the decisive factor.

Like the hon member for Kuruman, this hon member expressed his dissatisfaction that salaries had not been increased at this point. I wish to tell these hon members that they will score no political points whatever out of this. I cleared these aspects fully with the trade unions and the staff associations before I stated in Parliament that salaries would not be increased.

There was also insistence that pensioners’ pensions be adjusted to the inflation rate. What a foolish request! It comes down to the indexing of people’s pensions. What pension fund would then avoid bankruptcy? [Interjections.]

Order!

The hon member also requested that in-depth attention be paid to congestion at stations in order to prevent serious clashes. Again I am able to say that the situation is monitored continuously.

Order! Hon members in the comer at the back must lower their voices. I can hardly hear the hon the Minister. The hon the Minister may proceed.

Conditions at stations are monitored continuously and amenities are adapted to ensure that racial clashes do not occur. I think the SATS deserves congratulations on the success achieved in this regard.

In spite of the Government!

The hon member requested more information on decreases in personnel over the past nine months. On 16 January 1987 the establishment was 204 705 compared with 221 021 on 16 April 1986— therefore a decrease of 16 316. The hon member requested that the SATS again carry out a social function; I wonder whether the hon member knows precisely what he is asking for.

Of course I know.

In fact, he is asking that people who cannot be suited anywhere else be dumped on the SATS.

I said you should provide employment.

I can convey that request to SATS employees.

Did the 73 000 employees you paid off merely lie about there without working?

The hon member referred to the so-called coalmen appointed in the past and said he had noticed that they now acted as stokers on trains between Kimberley and De Aar. I gained the impression that the hon member did not wish those people to progress but to remain coalmen. I want to inform the hon member that this scheme for coalmen has been phased out and a scheme introduced in co-operation with the trade unions according to which vacancies in locomotive grades may be filled by persons from all racial groups. The difference between the hon member and me is therefore that he does not want people to progress merely because they are Black. We on this side of the House say people should progress regardless of their colour.

You do not want them to progress because they are White. [Interjections.]

SATS personnel can hold their own in the open market; they have already proved this. We intend maintaining this and even improving on it in the case of new appointments. It also vital in a deregulated market.

The hon member for De Aar also moved an amendment to this Bill. He requested the House to decline to agree to it because the Minister “is stimulating inflation with certain of the measures built into the budget”. It is absolutely ludicrous to make such an allegation about this appropriation. What are the facts? Expenditure is being decreased by R260 million; the corps of workers decreased by approximately 16 000, and there are to be no increases in tariffs. I should therefore like to ask the hon member to what he was referring in saying that. [Interjections.]

My thanks to the hon member for Wellington for his contribution. He made one casual remark of great importance during his speech. He said the SATS could not be expected to stand to attention for a casual consignment. I thank him for raising that point here. The SATS will not voluntarily discontinue any service. The communities concerned cause the suspension of a service when they cease to support it. Such an occurrence does not concern me; if alternative services exist which suit a community better, it is fully entitled to make use of those services. As the hon member said, however, we cannot be expected to be prepared for contingencies only.

The hon member appealed for a fair deal for agricultural products as regards accommodation under subsidies. This poses no problem to me …

Who is to pay for it?

… providing it does not take place by cross-subsidisation and providing the assistance is above board. He also referred to the difference in tariffs on wine and grape juice. I also find this anomalous and have requested the SATS management to examine this and furnish him with a good answer. I wish to thank the hon member for his contribution.

†The hon member for Durban Point averred that branch lines were closed without due cognizance being taken of the consequences. In general the volume of traffic conveyed on branch lines is not substantial. This volume can have little effect on the roads. Likewise the closing of branch lines can have no effect on the production costs of farmers as the traffic is conveyed by road transport services at rail tariffs for at least the first two years.

He also referred to the many stations being closed. The hon the Deputy Minister replied to that.

No, he did not; he did not give me a figure. I asked how many had been considered. Is it 10, 100 or 1 000?

That is an ongoing process, depending on the economic viability of those particular facilities.

In other words, you are ducking it.

No, I am not ducking it. If it is at all possible to say how many we are considering at the moment, I will let the hon member have that figure.

The hon member also referred to the condition of the lifts and the air-conditioning in the building in Johannesburg. I want to give him the assurance that it is not the intention to spend any money other than for ordinary maintenance of the equipment. Money will only be spent on ordinary maintenance.

The hon member also referred to the irregularities regarding the 1986 calendar. In this regard I want to say that money was budgeted for the SAA calendar but as a result of the curtailment of all low-priority expenditure the production of the calendar was postponed and the calendar as it was planned has now appeared for 1987. There was therefore no waste of money.

The hon member also referred to the rumours regarding service conditions. I would like to give the hon member as well as the staff of the SATS the assurance that there is no substance in the rumours that free passes will be withdrawn or that pensions will be reduced.

The hon member posed certain questions regarding the court case. May I just mention in passing that the case is still continuing and that it is impossible to give any figure at this stage. With regard to the question of rolling stock, I can say that all payments are completely up to date.

*The hon member for Uitenhage referred to the new workshops at Cuyler Manor and asked that they be put to fullest use. I wish to assure the hon member that this is actually the case already and that our future intention is to keep it so. He also requested that, on rearrangement of priorities, preference be given to the Port Elizabeth-Uiten hage area. I want to tell the hon member that any need for facilities in that area may be put to us; we shall view it sympathetically.

The hon member also referred to the old workshop there and requested us not to have it demolished. I have requested management to negotiate with the Uitenhage Municipality on this.

Thank you very much!

The hon member for Heilbron expressed concern on the reduction of the intercity rail service. There are still daily services; except for Sundays, a passenger train travels in both directions between Sasolburg and Arlington via Heilbron and this satisfies all requirements.

The hon member further requested that the phasing out of passenger services should not occur before the institution of substitute services. I can tell the hon member that rail services are not being supported precisely because of a gradual switch to other services such as road transport. Consequently, when rail services are discontinued, alternative services already exist.

The hon member also referred to the recovery of only variable costs and not those of depreciation. The hon member is not present at the moment but I wish it placed on record that it is still possible to make a profit if one recovers only the variable costs but this demands reserve capacity and the emergence of new traffic. In reality this is taking place now in the tapering off of services to PE, Cape Town and East London from Durban but depreciation also has to be recovered to be able to cover one’s capital costs.

I take great pleasure in thanking the hon member for Rosettenville for his last contribution in this debate. Without being dramatic, I think one may describe him in the Biblical phrase as being an Israelite without guile. I think hon members concur with me in saying this. [Interjections.] He also referred to that rail journey of his to Potchef stroom when he shared a compartment with a dancer. I think we should be grateful that his wife accompanied him on that journey because circumstances are sometimes of such a nature that they become rather difficult— even for a Christian. [Interjections.]

Four most excellent frontbenchers participated in this debate—the hon member for Durban Point, his benchmate, the hon member for Umhlanga and the hon members for Rosettenville and Kempton Park. I think I am speaking for all of us in saying these hon gentlemen are leaving this House with grace and the affection of all these hon members. I thank them most heartily for their participation in the debate. [Interjections.]

This brings me to the hon member for Kempton Park whose last speech here also contained something of moment, which was that the railway network should serve as a symbol of co-operation in Southern Africa. I should like to add that it should also serve as an instrument to prove our interdependence. I thank him for underscoring this. I can tell him the provocation from all directions will often be great but we should cling to this verity whatever we do. My thanks for his contribution too.

The hon member for Soutpansberg tendered apologies for his absence here this afternoon. I notice that the hon member for Germiston District is not present either but it also struck me that the hon member for Germiston District presented Railway people in a splendid light. She said they were exceptionally efficient and dynamic and even wanted a monument erected to them in Germiston. [Interjections.] One has to contrast this with what the hon member for Soutpansberg said. He said they were guilty of faulty assumptions, they uttered the greatest nonsense and had spent the past 70 years with their eyes closed. He did quote from a Minister’s letter but we are well aware that that information emanates from management. [Interjections.] No, Sir, it is obvious that either the hon member for Soutpansberg is wrong or the hon member for Germiston District is merely paying lip service. I think it is both. [Interjections.]

I wish to refer to the request expressed by the hon member for Soutpansberg. He referred to the curtailment of the service between Louis Trichardt and Messina. The reasons for this were set out in a letter to him. I investigated those circumstances and they remain the same as when he was informed of them.

The hon member for Sasolburg also participated in this debate. He referred to the question of subsidies on buses. I merely want to tell him I do not believe this is actually a matter he should have raised on this occasion. If he had been here, I could have furnished him with a little information but he can address all these matters during a debate on transport affairs instead of transport services. [Interjections.]

At this stage I should like to refer to a newspaper report which appeared in Business Day on Friday, 13 February and which runs:

†I want to make it very clear, Sir, that I have never said anything like that. [Interjections.] I want to state very clearly that nothing of the SATS is “up for grabs”—neither the airways, nor the harbours, nor the Railways nor the road motor services.

Only the Minister!

The hon member can try! None of those is “up for grabs”. I will handle the matter with the greatest responsibility and care. What I did say was the following:

*Much is said on the question of privatisation. There are inter alia three very important requirements for privatisation. Firstly, if a service is to be privatised, the private sector should be able to render that service as well or better than the public sector. Secondly, a monopoly should not be created in consequence of privatisation; for instance, a State monopoly should not be replaced by a monopoly in the private sector. Thirdly, it should benefit the public in the long term.

How does one gauge the quality of service rendered? There is only one way and that is that everyone should conduct business under the same circumstances. It therefore includes deregulation, as the hon member for Primrose said. By selling off services piecemeal, as the hon member for Port Elizabeth Central suggested, one does not necessarily prevent the formation of monopolies because the same three bodies can acquire all parts directly or indirectly.

Sir, there are many ways of privatising; two of which are very important to the SATS. In the first place, the sale of public undertakings is important. Most people have this in mind in speaking of privatisation but it also poses most problems regarding the forming of monopolies. The possibility of a partnership between the public and the private sector, in which even employees may be included, is to my mind a method holding far more promise. Sasol is a good example of this.

Three of the main services of the SATS are monopolies, of course. There cannot be a second rail network, a second set of harbours or a second pipeline. Consequently, it still has to be worked out in this case whether and how the private sector may become involved.

These arguments of mine—and especially those regarding the question of monopolies— are supported by one of the executive officers in aviation, Mr Peter van Hoven, in saying the following:

I am in full agreement with this.

Mr Speaker, the hon member for Greytown asked for an independent ombudsman. I do not believe that is necessary. There are many channels each official may pursue such as the Commissioners, public representatives—the hon member is one himself—the Minister, the Deputy Minister as well as the trade unions. Someone feeling aggrieved may consult all these people to have his grievance redressed. If the hon member was referring to any specific cases, I shall reply to him more comprehensively if he will supply me with further information.

The hon member for Claremont mentioned the dangerous subways at Claremont station. This is a problem facing us. I do not believe pedestrian bridges are a possible solution; those lines are too busy for this. I therefore do not regard this as practical. I promise the hon member, however, that we shall request the SA Police to carry out more thorough police patrolling in that area.

†The hon member for Umhlanga also raised some points. He referred to the fact that our domestic aircraft were beginning to look somewhat worn. He also referred to the baggage handling. We will look into all these matters and try to effect some improvements if possible. Furthermore, the hon member referred to the announcements which, he stated, were long and boring. We have to comply with safety regulations. The SA Airways will, however, endeavour to shorten the announcements.

*I thank the hon member for his gracious comment in saying: “It is the finest airline in the world”. I thank him for that splendid remark.

†The hon member for Bezuidenhout referred to the process of negotiation. I also referred to that in my introductory speech. We will certainly have a good look at that once the Wiehahn Report is at hand and ready for consideration. Furthermore, the hon member also mentioned my meeting with the trade unions. He said it had been a disaster. The hon member, I believe, was expressing his own personal wishes and desires more than he was referring to my relationship with the trade unions. My information is contrary to what he stated here today.

The hon member also made mention of the accountability for subsidies. I agree with the hon member. Those preconditions to which he referred will have to be addressed.

But what does the hon the Minister of Finance have to say about this?

The hon member for Kuruman wanted to know what the SA Transport Services would contribute to regional services councils. I think the hon member did not go about this in quite the right way. The R800 million referred to is the possible income accruing to regional services councils; it is not the amount we shall pay over to such councils. I can point out to him that the monies payable by regional services councils will be the same as all other employees will pay in the region concerned.

I have already replied to him regarding the question of congestion. I have also replied concerning the matter of discrimination and I should just like to tell the hon member this: There are numerous other services which are very successful and in which no problems whatsoever have arisen such as those referred to by the hon member. The SATS addressed that matter and I have already informed him that these matters are adjusted from time to time according to the needs of our clients.

I should like to allude to that report in the newspaper to which various hon members have referred. It was in the Cape Times of 12 February and dealt with Mr Meyer’s statement. The end of that report—this emanates from the Durban Chamber of Commerce— runs as follows:

†Mr Speaker, we have every intention of becoming just that.

Question put: That all the words after “That” stand part of the Question,

Upon which the House divided:

Mr Speaker, I move:

Mr Speaker, I think that the entrance of the hon the Minister of Finance at this moment in time is in accordance with his customary last-minute appearances. I think what he was actually doing— that is why he is late and I can understand it—was revelling in the fact that he had been chosen by the editor of True Love to be the Minister of Finance. I am sure he feels that the editor of True Love as an economics and financial expert has now really recognised him!

The only point that I want to make to the hon the Minister is that I want to give him the assurance that when he is the Minister of Finance in the Cabinet that the editor of True Love would like him to be in, I think I will continue to be in the opposition. If he will look at the composition of that Cabinet, he will know what I am talking about!

Does the hon member read True Love?

No. The hon the Minister has a problem with true love, and I know there is little true love in the NP. I read a publication called Business Day. If the hon the Minister wants to read True Love, I am sure there must be one in the library for him which he can read secretly at home.

Traditionally one does not oppose the Third Reading of the Part Appropriation Bill. However, on this occasion one would be sorely tempted to oppose it, were it not that one keeps to tradition and sees to it that the country has money in order to continue until the main Budget is passed. However when we look at the record of the Government in the matter of finance, when we look at the performance of the hon the Minister and his Government during the part appropriation debate, then that temptation is something that one has great difficulty in resisting, but, one does resist temptation.

When we speak and ask questions as we have tried to do, on fundamental issues we find that the answers are not given. The answers remain in the air. The questions remain but the answers are not given. When we look, for example, at the issue of what is a pre-election budget and at what was regarded by a previous Minister of Finance as unethical, then may I recommend to the hon the Minister a publication which he is fond of quoting when it speaks in his favour, namely Finance Week which has on its cover: “Barend’s election bait”. Sir, I am sure that you will allow me to use that word as it is a quotation. Also on the cover is a picture of a beautiful parcel—“Barend’s election bait”— nicely wrapped. However, the difficulty is that one does not actually know what is in that parcel. It is merely the wrapping that is really attractive; the contents of the parcel are quite a different story.

I should like to put some pertinent questions to the hon the Minister which I would like him to answer today. Firstly, will he explain why it was necessary to announce social pension increases in February during a so-called “pre-election mini budget debate”, when in fact these increases are only, to use his own words, “to come into effect in October”? In any case, they are not special increases since they amount to virtually the same as the annual increments which the pensioners receive to offset high inflation. If the pensioners were to get increases early this year, we would support those increases. In fact, we have asked for them, and we have continually asked for them to be paid earlier or when they are announced. After all, if anyone deserves increases, the pensioners do. I should like to know from the hon the Minister, therefore, what logic there is in announcing in February an increase that becomes effective in October when he has already announced his Budget for June. That can only have been done for pre-election purposes. This action cannot possibly have been taken for any other reason.

Let me also point out that the increases which he is giving to the pensioners are still below last year’s inflation rate and still do not compensate the pensioners. Let me say clearly, therefore, that as far as we are concerned we would have supported the granting of the increases with immediate effect. However, this kind of stunt of announcing in February something that is to come into effect in October, needs a little explanation.

Let us turn to the position of the farmers. The farmers have been promised two allocations: R117 million as part of the five-year programme, and another R120 million. Those amounts will be included in the estimate in any case, and are only going to be implemented in the new financial year. Can the hon the Minister tell us, therefore, why he has specifically selected that particular item and not other items to be announced in the part appropriation debate? Why has he done that? The only conclusion we can draw is the one that Dr Diederichs pointed out, namely that there is a motive to this.

Let us take another issue—the early repayment of the loan levy. The hon the Minister has promised that this loan levy will be repaid by not later than 30 March. He has promised this despite the fact that this loan levy was originally imposed for a period of seven years in the financial year ended 1983, and despite the admission that the staff of the Receiver of Revenue are, to use his words, “fully stretched with 2 million 1987 tax returns”. Come what may, however, these repayments will be made before 30 March so as to ensure that they are sent out before the election!

Let me test the hon the Minister on another matter. I took the trouble to study both his typed speech and his Hansard. He can correct me if I am wrong, but they read:

He says so in both his unrevised Hansard and in his typed speech. What is this hon Minister actually up to? I took the trouble to take out the 1982 Hansard, and in there I read that when the levy was imposed, the interest that was to be paid was 8%. [Interjections.] Why is the hon the Minister taking or trying to take 0,5% from the people who gave him that money? [Interjections.] Why is he taking that away? What game is he playing? [Interjections.] In case he thinks he is going to get away with it, let him tell him that I took the trouble also to look at the Income Tax Act. If the hon the Minister looks at section 32 of the Income Tax Act, 1982, he will find out why, if he tries to get away with pinching that 0,5% from the people of South Africa, we will take him to court! [Interjections.] Yes, we will take him to court. So I do not understand what he is getting up to. I really do not.

Let me cite another example, namely the question of married women to which I have already referred. That was going to be provided for in the Budget. I see the hon the Minister is looking around. Yes, he must look around; he must get an answer to this one, for this was really a bad mistake on his part. [Interjections.] There must be some little answer he can give.

Do not worry, everything is under control.

The hon the Minister says everything is under control. We note, however, that he did not say 8,5%, but 7,5%. He would not make a mistake in favour of the taxpayers, but only in his own favour. I know what kind of business he should be in!

The same applies in the case of married women. The adjustment to the married women’s tariff and deduction tables cannot even be brought about until May. However, to make sure that he gets their votes, he says that the computer bureaux should get to working order to make sure that the married women receive their deductions. We think that these allowances in respect of married women are still wrong, and we believe that when the Margo Commission report comes up for discussion, we shall have some even more far-reaching proposals to make with regard to married women. Perhaps if we were to look at the Margo Commission report which the hon the Minister is holding so close to his chest before the election, we would find that the Margo Commission agrees with the views we hold in this regard.

Let us take a look at the interest allowance. The hon the Minister proudly announced that the allowance was to be increased now, in February. Could he please tell us what benefit there is in announcing it now as opposed to announcing it in the Budget, other than for possible electioneering reasons? The fact is that there is going to be no deduction at source, and that the first benefit it could possibly have, would be in respect of the first provisional tax payments in August. He could therefore have announced it in May. However, he is so desperate to do something with regard to the election, that he had to do it now. [Interjections.]

Let us also take a look at the situation with regard to GST. Here he has acted quite remarkably in making this tantalising remark:

To me, that means that he knows what is in it. However, he is not telling us; he is not telling the public of South Africa. He is holding that Margo Commission report close to his chest even though he could publish it. We challenge him to publish it before the election, because one of the things that troubles us, is that when we come to debate it, we want to know how the lower income groups of South Africa are going to be treated in these new proposals. After all, he has said throughout that he has an ace up his sleeve as far as food is concerned. If that ace up his sleeve will be of assistance to the poor and to the lower income groups in South Africa, so that the benefit is passed on to the right people, then that is another matter. However, if what he has up his sleeve are what he describes as “omvangryke en ingrypende voorstelle” and he does not want to make them public before the election, then there may well be something sinister behind all this—not in the report of the Margo Commission but perhaps in the White Paper which is in the process of being prepared. We therefore challenge him to make these matters public before the election.

I should now like to turn to the matter of the regional services levies. The amount that was estimated by his own officials in respect of the regional services levies—this estimate was made two years ago—indicated a yield of an extra R800 million per annum. This figure must now be substantially greater, bearing in mind inflation and various other related factors. We may therefore assume that the figure is now about R1 billion per annum. Moreover, in the Transvaal a certain Mr John Griffiths, who is the MEC in charge of local government, says that after the first year the amount is likely to be doubled. In other words, what the hon the Minister is doing, is coming here now before the election with these tax concessions in order to try to bait the voters, knowing full well at the back of his mind that they are going to collect another R1 billion and, according to Mr Griffiths, a possible R2 billion in a year’s time, from a new source of taxation. Well, if that is not electioneering, then I do not know what is.

Let us deal briefly with what is actually happening in regard to the election. One of the hon the Minister’s favourite financial publications says that the Government will never allow us to fight on economic issues in this election. They will shift the spotlight away onto something else. Already we can see the signs. One only has to read the newspapers to see the stories of “boerehaat”, which is an old, archaic concept which not a single person in South Africa today is going to take the slightest bit of notice of. [Interjections.] That issue is irrelevant in South Africa. What they are not dealing with, however—and these are the fundamentals—is the issue of whether there is going to be real negotiation in South Africa in order to ensure security. That is what this election is about. They are not going to deal with mismanagement and inefficiency and the incorrect policies which have landed us in this economic mess. Inflation, the erosion of the value of the currency and unemployment which has created instability and the destruction of confidence—those are the things that this Government is going to run away from. They are going to try to raise bogies in an attempt to divert the voters’ attention from the real issues in South Africa.

Mr Chairman, the hon member for Yeoville did not say much here this afternoon, except to make very strong overtures to the pensioners and other voters of South Africa prior to the election.

You are going to the Transkei!

We are grateful for the fact that the PFP is at least, for a change, worried about the vicissitudes of the White voters, and we hope they will keep it up after the election.

The general theme of the debates in this House, since the opening of Parliament, has been reform. It is clear that it is going to become one of the main issues of the election. It is, however, ironic that after a year in which the most fundamental of reforms in South Africa’s history have been introduced, one of the hottest political debating issues is still whether fundamental reform has, in fact, taken place in the country. I want to tell the Official Opposition and foreign visitors, who so frequently pose this question, that the NP’s reform measures have been impressive, and the reform process has not come to a halt. Nor will reform come to a halt during or after the election.

Recently the Government has sharply focussed on the implementation of reform measures, but that is not where it has stopped.

Gertjie, you have not said anything yet.

Our whole pattern of thinking is focussed on devising further steps, because we are determined to work out a future for everyone here in South Africa. Hon members opposite may sit there laughing, if they wish.

Last week I told a foreign Press correspondent that had it not been for the unrest, sanctions and the ceaseless pressure and interference from abroad, we could have been much further with the reform process in this country. [Interjections.]

The radical intimidation campaign of the past few years against the reasonable Black leaders has kept them away from the conference table.

Mr Chairman, may I put a question to the hon member?

Unfortunately I do not have the time, Sir. Otherwise I would answer the hon member’s stupid question.

The reform process has definitely been complicated by the disruptive effect of foreign interference in the debate on reform. This interference has hardened attitudes, brought about further polarization and reduced the possibilities for negotiation. If country’s abroad would only keep their noses out of our affairs, keep their hands off us, we would make better progress with reform in South Africa.

The NP is the evergreen party which, after 40 years in power, is still setting the tone in this country, is still dominating innovative political trends of thought, is still relevant in our politics and has the only realistic policy that can succeed in the Republic of South Africa.

Gert, how are you people going to bring in the Blacks? Tell us about the Blacks!

I am coming to that. [Interjections.] It is frequently asked, as the hon member for Jeppe has just asked— a question that will probably be asked in the election too—where the NP is taking the Black people in this country. Let us take another brief look at NP policy. The multiethnic nature of South African society is unequivocally acknowledged and accepted by the NP, with self-determination for groups when it comes to their own interests and joint decision-making on matters of common concern. We therefore believe in power-sharing, but power-sharing without any take-over, surrender or domination. The NP stands for the preservation of self-governing areas as part of South Africa until they themselves opt for independence. Outside the national states the NP wants to create, for the Black communities, structures for self-determination and for the maximum devolution of the functions of authority, still focussing on powersharing, but not on the surrender of power.

What have you just said?

Full autonomy and even independence for metropolitan areas will not be turned down. That, in a nutshell, is the course the NP wants to adopt.

I do not want to argue with opposition parties today, but I want to ask them where they stand. As far as the Official Opposition is concerned, I do not want to be simplistic, but if one were to throw all their statements into a pot, one would clearly see that they were heading for only one thing, and that was the surrender of power. The CP fearfully continues to shy away from the realities of South Africa. CP members now sit their laughing, but they would do well to spell out for us the course they have adopted. [Interjections.]

Order! In a moment hon members of the CP will have an opportunity to make speeches.

He makes us angry, Sir.

Order! The hon member for Langlaagte will probably also have an opportunity to speak at a later stage. The hon member may proceed.

The CP members will not be able to escape the harsh realities of reform, even if they laugh about it. In this election they will have to tell us what they are going to do with the millions of Blacks outside the national states. The hon leader of the party has not yet told us. They are going to be faced with their moment of truth much sooner than they realize.

What are you going to do with them?

In my last speech in this important debating forum I want to ask the opposition to play a more constructive role here. In a democracy such as ours an opposition is very important. Good, constructive opposition can keep a Government on its toes. Good opposition helps to facilitate good government, but interjections such as those of the hon member for Jeppe get one nowhere.

But I did not say anything.

There are too many negative and derogatory remarks from the opposition side of this House. What we should get from the opposition is farsightedness and good, feasible alternatives from which the Government can learn in the course of performing its task of reform. Instead of that, however, we have interjections at an almost animal level.

Our opposition parties have, to a large extent, become irrelevant. Why? Because negativism has pushed them out of the mainstream of politics. It is significant, but tragic, that in the election campaign the Official Opposition does not even present itself as an alternative government.

I want to ask those hon members who will be returning to this House—and many of them doing all that shouting will not be coming back—to preserve and protect this Parliament as a precious possession. The powers of anarchy would like to see chaos and decay manifesting themselves here, but hon members must not allow that to happen. This Parliament must remain a bastion, a lighthouse, of democracy on a continent where democracies tumble like a house of cards.

The 16-year sojourn the Good Lord has granted me here has been one of golden years brimming with political experiences. What a great privilege it has been to be here! I knew that some time or other the day of parting would dawn, as it will for all hon members. I leave with the fondest memories and with sincere, heart-felt thanks to everyone here. My thanks, too, to the National Party and my voters in Bloemfontein North, one of the model constituencies in South Africa which brought me to this House with such wonderful majorities.

I gladly go to the pioneer state, Transkei, where I shall continue to serve South Africa and do my level best to maintain good relations with them and to further extend those relations. Our future lies here and not in Europe or elsewhere. That is why it is necessary for us to make peace here and cement the ties of good neighbourliness.

Mr Chairman, I feel exceptionally privileged to congratulate the hon member for Bloemfontein North on his recent promotion. He deserves it and we are sure he and Mrs Terblanche will represent South Africa with dignity and grace. We wish him every success in that venture.

As regards the Part Appropriation Bill, at the outset I wish to express my thanks and appreciation to the hon the Minister for the few hundred million rands he has voted for farmers in drought-stricken areas. It is absolutely vital that those farmers receive assistance. The assistance voted in the appropriation represents the legendary drop in the bucket; nevertheless we are grateful for it and believe it is a small start on the way to a great effort.

Since coming to this House years ago, I have been saying that the most powerful negotiating instrument in the world is food. When a list of priorities has to be drawn up for man—aeroplanes, motorcars, food, dwelling houses, etc—we inevitably reach the incontrovertible fact every time that water and food are most important to man. Consequently I wish to appeal to the hon the Minister to attempt to ensure in future appropriations that farmers in stricken areas receive larger amounts of money to keep them in business and to re-establish them in those areas to retain them for South African agriculture. The fact is tragic but true that it has been found that there are parts of our country where 50% of the farmers are faced with ruin at the moment. We are confident that the Government will give this matter its positive attention.

A future day may dawn, and dawn it will, when world leaders and those from Africa will have to confer and enter into agreements. Atomic or other bombs, aircraft or cannon will not be the mechanism for success in those negotiations; it will be food. Our negotiating statesmen will then have to be able to tell those leaders that South African farmers’ flocks and herds are fat and their barns overflowing. Such a leader will be able to negotiate in future. To make this possible, an attempt now has to be made to keep our farmers on the land. This is absolutely vital.

When one views the signs of the times, one sees political turbulence in South Africa. Recently words once spoken by the great poet king, David, have often flashed through my mind: “Why do the nations rage furiously together and the people imagine a vain thing?” Surely that is true as evidenced by the turbulence in South Africa; one political party is striving against the other. As if that were not enough, there is turbulence even within political parties so that someone is frequently swept to the top in the boiling foam and has to find a seat somewhere else. We have seen this recently.

The most significant sign of the times in which we are involved at present is the coming election. I want to ask the Government today what it intends offering the voters. I assume the burning question of this election will be—it certainly ought to be—what the political position of the Black man will be in future governmental structures in South Africa. What will the Government present to the voters?

Under the new dispensation we started with the formula of 4:2:1 which is acceptable and reasonable. What will this be with the addition of the Black people who total approximately 15 million in White areas? What will the Government do if the Black man tells him the proportion including them has to be 15:4:2:1? What will the answer be? If that is not to be the answer, we should like to know what is.

I should say the Government should first have negotiated with Black leaders, taken certain decisions and subsequently gone to the voters to receive a mandate regarding them.

This is not sufficient either, however. Politically and constitutionally there are only two ways South Africa can take. Of the two, separate development is the more difficult and certainly also the more expensive but it is the surest way to guarantee the survival of Whites in South Africa for all time. The Verwoerd epoch in the sixties to the late seventies proved this to us. When separate development was experiencing its full momentum, South Africa had its golden years. The economy was sound, money flowed, work was abundant and the internal security situation was as good as it had ever been in South Africa. [Interjections.]

Integration is the alternative. It is obviously the easier course and perhaps also the cheaper but indubitably a deadly course for the survival of Whites in South Africa. I wish to read to the House what the late Dr Verwoerd had to say on integration:

Hear, hear! Look at them now.

Your forebears were “hensoppers”!

In 1899 a conference was held in Bloemfontein, the Free State capital. President Paul Kruger and Marthinus Theunis Steyn, the President of the OFS, were on one side of the table and Lord Kitchener and Lord Milner on the other. Milner negotiated with Kruger on political, civic and voting rights for foreigners on the Witwatersrand gold fields. The demands increased but President Kruger conceded where possible because he knew he could not fight Great Britain. Great Britain was the world and the world was Great Britain so Kruger made concessions.

When Lord Milner made the impossible demand, however, which convinced Kruger he would have to surrender all he had, the craggy old giant’s voice broke and in a quavering tone he used this imagery to Lord Milner:

In its negotiations with Black people on political rights, I want to tell the Government today in all seriousness that to my mind President Kruger’s position and choice were a hundred times easier with Milner than the choice today before which the Government will place us in its negotiating political rights for the Black man in South Africa. The people facing Kruger were Whites. They spoke a different langugage but they were Whites. I see my way clear to serving under them; I find this no problem.

We have seen, however, what happened in the rest of Africa where the White gave everything he had to the Black man to gain his favour and draw him into a single government. We have seen this and that is why I wish to ask the Government to act in such a way before, during and after the election that our people will not tell it subsequently: You have given away our all.

Preserve us from this.

Mr Chairman, …

Mr Chairman, on a point of order: Is it permissible for the hon member Mr Vermeulen to say all the hon member for Meyerton’s forebears were “hensoppers”? [Interjections.]

Order! Did the hon member say that?

Mr Chairman, I want to correct that and say I was not referring to him specifically but to all of them.

Order! I beg your pardon?

Just say that to me outside! [Interjections.]

Mr Chairman, on a point of order: That hon member said, “Look at the ‘hensoppers’ sitting here!” [Interjections.] It was merely in reaction to his words …

Order! Let us first establish what happened. Which hon member said: “Look at the ‘hensoppers’ sitting here”?

Mr Chairman, I said that.

Order! The hon member must withdraw that.

Mr Chairman, I withdraw it.

Order! I want to say at once that I have a slight problem. If an hon member calls people outside the House—in this case forefathers— “hensoppers”, I cannot say it is unparliamentary. Nevertheless I do not think it contributes to the dignity of the House to make such a remark. I therefore request the hon member Mr Vermeulen to consider withdrawing it. I am not ordering him to do so but I request him to consider withdrawing it.

Mr Chairman, I shall withdraw it. [Interjections.]

Order! The hon the Minister may proceed.

Mr Chairman, arising from the hon member for Meyerton’s words here today, at the outset I wish to state it very clearly and unequivocally that the Government, the NP in particular, has never denied or ignored the question of distinctiveness and separate development and the recognition of the identity and ethnicity in South Africa—neither does it intend doing so. [Interjections.] This tricameral Parliament is the very confirmation of a recognition that differences exist among people.

What about “Squeegee”?

It is a manifestation of a Government’s conviction that one can only solve the problems of this country if one recognises and protects the identity and the rights as well as the cultural heritage and the distinctiveness of various groups. The hon member asked where we were headed in future. Surely our future course is abundantly clear. We are continuing along that course to give everyone in South Africa elbow room so that he does not feel threatened by other groups.

We feel threatened by you!

I understand the hon member’s feeling threatened by us. The hon member fled from Rissik and then sought a seat at Heilbron—but he was not acceptable to the people of Heilbron. [Interjections.] He then fled back to Rissik and on 7 May he is flying off somewhere—I do not know where— but he is not returning here in any case. [Interjections.] That one bolts; he is a frightened man. [Interjections.] I understand his fears. He fled from the United Party; he then almost fled to the HNP and then doubled back. He has now run back to the CP and he is well on the way to the AWB. [Interjections.] He is a bolter; we know him only too well. He is a sprinter, an athlete.

While I am on the subject, I may as well mention the other hon members too. That hon member is running from Langlaagte to Pretoria West. [Interjections.] We have still more sprinters, more athletes on that side.

[Inaudible.]

The star athlete on that side is actually a shot-putter. It is the hon member for Jeppe. He is running now.

[Inaudible.]

The hon member for Jeppe would win any race over 100 yards. If his brakes were not so good, he would have run from Jeppe clean across the Vaal River. [Interjections.]

Mr Chairman, may I put a question to the hon the Minister? [Interjections.]

I shall give the hon member an opportunity for a question later, Sir.

Does the hon the Minister own a business in Jersey? [Interjections.]

Order! The hon member for Langlaagte cannot make rules to suit himself and jump up and shout and carry on. I now request the hon member to control himself; if not, I shall be obliged to take steps against him and I should not like to do that—not shortly before an election in any case. The hon member may proceed.

Mr Chairman, may I put a question to the hon the Minister?

Sir, I shall give the hon member an opportunity to do so; just let him contain himself for a while.

The hon member for Langlaagte is such an excellent athlete and he is running from Langlaagte so fast that his heels are battering the back of his head. [Interjections.]

Sir, we are actually dealing with a group of refugees here. There is a refugee camp on the other side. [Interjections.] I think we should report it to the UNO High Commissioner for Refugees. [Interjections.] I think we should consider providing emergency aid to those hon members.

There is something which characterises that party to me. The voters of Langlaagte must know the hon member for Langlaagte. The voters of Jeppe know the hon member for Jeppe and the voters of Sunnyside know the hon member for Sunnyside exceptionally well. [Interjections.] It now appears to me that these hon members’ problem is that they are not standing in constituencies where the people know them. [Interjections.] Their strong point lies in the fact that they are standing in constituencies where the people do not know them. [Interjections.] The logical conclusion to this is that, if the people know them, they will be kicked out and that they perhaps stand a chance of coming in where people do not know them.

Great speech!

I should like to leave it at that now. [Interjections.] Hon members of the PFP should not become so agitated. The hon member for Greytown at the back there should not put up such a defence of the CP; we know they are coalition partners against this Government. [Interjections.] The hon member for Bryanston has already said so. The hon member may as well behave; he will also receive a little attention. I shall attend to the hon member for Greytown and, if the hon member for Jeppe behaves himself, I shall give him a whole bunch of bananas tonight. [Interjections.]

Tell us about Nat Props! [Interjections.]

Sir, I shall attend to the hon member for Jeppe later. I shall give him two bunches of bananas!

You are acting like a “witgatspreeu”! [Interjections.]

I have listened attentively to the debates of the past few days and since we met here.

Tell us about your dealings in Jersey with the financial rand!

To my mind, a single thread ran through all the debates and that involved the pessimism, defeatism, depression and desolation existing in CP and PFP ranks. It also applies to the only HNP member of the House. The only message one hears is one of ruin and problems. Not one of them expressed his confidence in South Africa, its people, its future and the development of the riches locked in its earth.

[Inaudible.]

Order! The hon member for Langlaagte has now made his last interjection in this debate. The hon the Minister may proceed.

The hon member for Langlaagte should just tell us what became of the money people lost on Corlett Drive Estates, of which he was a director, then we can talk about this again. If he is looking for trouble, he will find it.

Mr Chairman, on a point of order: What the hon the Minister has just said reflects on the integrity of an hon member. The implication is that he should say what happened to other people’s money which creates an impression of falsehood and criminal activities.

I challenge him to say that outside the House.

I feel you should protect the hon member for Langlaagte. The hon the Minister should withdraw that.

Order! The words in themselves are open to a number of interpretations. Did the hon the Minister mean that the hon member for Lang laagte had done something dishonourable?

No, Mr Chairman, I merely meant he was incompetent. [Interjections.]

Order! The hon the Minister may proceed.

Mr Chairman, the question is … [Interjections.]

Mr Chairman, on a point of order: I request you to give your ruling on the contents and implications of the statements made by the hon the Minister to the hon member for Lang laagte.

Order! I do not understand the point of order the hon member for Rissik is putting. Could he perhaps explain its actual substance.

Mr Chairman, my point of order comes down to the fact that I consider this hon Minister to have acted insultingly to an hon member of this House.

But what did he say to me?

Oh, do keep quiet! [Interjections.]

Order! I have taken note of the hon member for Rissik’s argument. The hon the Minister may proceed.

Mr Chairman, I think the hon member for Rissik’s problem lies in his political impotence. [Interjections.] I ask hon members of the Conservative Party to reply to the following question. They create a great fuss because this Government is supposedly governing without a mandate. For months—I could almost say years—they have been carrying on and challenging us as regards the mandate. When the hon the State President announced the election date here, however, those hon members all seemed to be listening to the death knell. What is more, a number of them took to their heels—and they are still running. [Interjections.]

The hon member for Lichtenburg ranted and raved about everything. Nevertheless that hon member has been sitting in this House under the mandate of P W Botha and the National Party since 1981. Only two hon CP members have a mandate; they are the hon member for Soutpansberg and the hon member for Waterberg. They were defeated and repudiated by a two-thirds majority in the 1983 referendum but are still sitting here. They should have heeded the warning of that referendum. Now they come up with talk of morality. If those hon members had any serious intentions regarding morality, they would have resigned long ago. They would long since have ceased being members of this House. [Interjections.]

I wish to take it further, however, Mr Chairman. The hon member for Rissik stated here that we expelled them from the National Party. The fact of the matter is this: The hon member for Rissik gassed himself politically in the caucus. [Interjections.] Those hon members left the National Party not because they were driven out but because they refused to support a motion which was proposed. That motion ran as follows:

They refused to do this, Sir. They refused to express confidence in their leader so they were disloyal to him. [Interjections.] That is why they left the National Party; they were in no way expelled. The hon member for Rissik gassed himself politically by being disloyal to his leader. In addition, they had eight more days’ time; the then Prime Minister granted them eight more days to reconsider.

Oom Sporie reconsidered and look at him now! [Interjections.]

The hon member for Rissik was the first man to leap up and say the Prime Minister’s leadership was not acceptable to him. He left the hon member for Waterberg no choice; the hon member for Waterberg was obliged to go then, Sir. He was forced to go. Those are the facts; that is why they left the National Party. [Interjections.]

At this point the CP is masquerading here as an alternative government. [Interjections.] The hon leader of the Conservative Party is not even capable of providing leadership to the rightist groups in this country. [Interjections.] Yes, let alone leading South Africa and reconciling the warring elements in that country. That is patently impossible. [Interjections.]

Add to this the fact that surely the hon leader of the Conservative Party displays no qualities of leadership in writing to the leader of the HNP that he is quarrelsome and belligerent. Furthermore, in this letter of his to the leader of the HNP the hon leader of the Conservative Party writes:

The hon member for Waterberg therefore implies that the leader of the HNP is dishonest; he is accusing him directly of dishonesty. How can such people lead the country? On 6 May the people will have to choose who they want to negotiate with the various population groups in South Africa, with the outside world and with the conflicting elements in South Africa—the hon member for Waterberg, the hon retreaded member for Sea Point or the hon the State President.

I want to take it further. I should like to know of the Whip of that party what they would do if they were to win the election and have to put together a cabinet on 7 or 8 May…

Then you would not be in it!

Thank God!

I want to ask them now whether they intend including the Coloured and the Asian in that cabinet they will have to put together.

We shall first institute an investigation into Nat Props. [Time expired.]

Mr Chairman, the hon member for Lydenburg made a very interesting political speech for the forthcoming general election but I wonder if the hon the Minister of Manpower is very happy about the financial situation. [Interjections.]

Order! If hon members wish to squabble or fool around, they must please do so outside this House. The hon member may proceed.

The hon the Minister made a very interesting political speech in his capacity as a member of Parliament, but I wonder if he is just as happy about the financial situation in his capacity as Minister of Manpower. I suspect that if he were a Japanese minister of manpower he would be dashing off to commit seppuku, because anybody who has as much unemployment in the country and has not been able to resolve the problem would not consider continuing in the job. A great deal of the Second Reading debate was devoted to inflation and the ill effects it had had on the general economy and tradeworthiness of South Africa in relation to those of its partners. The hon the Minister conceded that the subject of inflation was important and that the Government was addressing the matter. He was, in fact, optimistic that the rate would soon fall. I am not that optimistic that it will fall as I do not believe that the hon the Minister has really started addressing the problem at all. I believe that whilst we have excessive Government spending, poor productivity in the public service and a bloated bureaucracy, we just do not have a chance. Furthermore, while we maintain the apartheid system, particularly in the areas of education, hospitals and local government, then I again believe that there is just no hope of curbing inflation.

I have given this matter considerable thought and I am beginning to wonder. Year after year the hon the Minister of Finance and his predecessor have addressed the problem of inflation and I am beginning to wonder if there are not certain advantages to the Government in keeping inflation at a high rate. I wonder if this high rate is not being manufactured, because it does have the effect of devaluing our currency so that the balance of payment situation is easier to control. It also extorts the savings of the frugal middle classes without imposing a direct taxation on them. This is quite important to bear in mind. I say that it enhances the balance of payments situation because imported goods are too expensive for the local people to buy and as far as exports are concerned it makes trade a great deal easier. We all know too that as far as gold is concerned, it does the Government a great deal of good when one considers its rand value and the taxes that they can obtain from it. Therefore, I am beginning to wonder whether the high inflation rate is not deliberately being maintained by the Government for various reasons. I believe that a straight, honest answer should be given to this question.

Criticism has been levelled at the Natal kwaZulu Indaba proposals on the matter of the cost of the equalisation of services, but has anybody given a thought to the fact that, whilst it will be expensive to equalise the services, enormous savings can be brought about as a result of rationalisation when one gets rid of a lot of the crazy systems which have been brought into being by this Government? This is a very important point to bear in mind. It must also be borne in mind that, if one gets rid of all those systems, it may well be attractive to commerce and industry to come to Natal, and this will boost the economy of that province enormously.

One must remember that this is one of the few parts of the country that has a great potential which has, in fact, been investigated. I am now talking about the Tugela Basin. As far back as thirty or forty years ago—I think the hon member for Durban Point mentioned it in a previous speech— Douglas Mitchell, during his time as Administrator, got this project under way. It has enormous potential for the supply of both water and labour as well as almost every other necessity for massive industrial growth. So, all these points must be borne in mind when one talks about the possibilities of the kwaZulu-Natal situation.

With due respect to the hon the Minister, I believe that this part appropriation is somewhat … [Interjections.]

Mr Chairman, on a point of order: The hon member for Lang laagte came walking from the other side and broke the line, and when we said “Order”, he just kept on walking, and I do not wish to repeat in this House the language he used.

Mr Speaker’s chair is moving in that direction. [Interjections.]

Order! The hon Chief Whip is quite correct. The hon member did break the line and must please walk back and resume his seat. [Interjections.] Order! The hon member for Umbilo may proceed.

Mr Chairman, with due respect to the hon the Minister of Finance, this part appropriation is somewhat the same as the forthcoming election in that the hon the Minister is asking to be given a blank cheque in order to sort out the country. The hon the Minister is saying that they cannot tell us what their policies are. We must just trust them and they will try to rectify the damage they have caused. This applies to our economy in exactly the same way as it applies to this general election. Nobody is really telling us what is going to happen with the economy in the future, neither is anybody telling us what is going to happen in respect to this general election and what their intentions are.

As mentioned earlier, the hon the Minister has prophesied a reduction in the inflation rate, but how serious is the Government in this when undisclosed increases in the bureaucracy are in the pipeline? The direct as well as indirect costs of regional services councils—already mentioned by other hon members—are still a secret, but will be heavy and inflationary and the Lord alone knows what the newly proposed ministerial representatives or Assistant Ministers will cost.

It is quite obvious to me that this hon Minister does not have control over the more profligate spending of his Cabinet colleagues and, that being the case, I do not believe it is possible to have any serious reduction in the inflationary spiral which is crucifying the economy of this country.

Mr Chairman, in the two and a half years that I have had the privilege of holding this position I have seen how the hon member for Yeoville handles defeat, because we have proven him wrong in so many instances.

Name me one!

In my reply to the Second Reading debate last week, I proved him wrong, totally wrong, on two points. However, the crucial test today is how the hon member will handle success, because he was right on one point. I want to concede that point to him right now. The percentage is 8% and not 7,5%, as was stated in my speech. My problem is—and I thank the hon member for bringing it to my attention because this is the first time it in fact came to our attention—how do I handle the situation depart mentally? I already have here the apology of the very senior official who was responsible for this mistake and he is not here.

No, it is the hon the Minister’s mistake.

If the Minister of Finance has to take personal responsibility for each and every figure that he handles … [Interjections] … That is a question of impossibility. Ultimately, he is accountable and I am not shirking that accountability at all. What do I do with this official? He is a senior man with absolute integrity, but totally overworked.

He is a nice guy. I forgive him! [Interjections.]

Thank you. I will gladly convey the forgiveness of the hon member for Yeoville to this very senior staff member.

I would like to tender my apologies to this House and to the public at large for having quoted a wrong figure. The percentage applicable is in fact 8%, and not 7,5%. It was a bona fide mistake.

No one was pinching anything!

And nobody intended to pinch anything from anybody.

It is our job to make sure.

The rest of the hon member’s remarks I find quite remarkable in a man of his experience in regard to how Parliament operates. I sincerely hope that we can do away with this kind of nitpicking debate. I would like to reply to the hon member’s remarks one by one.

Firstly, he asked me: “Why was it necessary to announce the R200 million increase in social pensions now?” The simple fact is that there are many reasons for doing this. One of the simple reasons is that if we postpone it until 3 June, we will have administrative problems. Secondly, there will be insecurity as far as the pensioners are concerned. It is unfair to have them wait until June to know whether they are going to get even a modest increase such as this one. Normally it is done in March when the main Budget is submitted.

While I am on the topic of the main Budget: This hon member and the hon member for Umbilo know full well that it is impossible to have a full Budget submitted to Parliament under the circumstances of an election in the first half of the year.

We could sit just a bit longer.

It is not my prerogative to determine the election date. If we had planned to sit a little bit longer, then we would certainly have been ready with the Budget. In fact, this year. I think the Budget would have been submitted on a date very much earlier than normal.

I take it amiss of the hon member for accusing us of performing a stunt as far as the social pensions are concerned.

I just want to mention another administrative point, and I do not want to dwell on this issue too long in great detail. The way pensions are being operated now, is the following. The Minister of Finance identifies the total amount available. From that point onwards it is a matter of negotiation between the four Ministers responsible for pensions for the four different population groups. To begin with, this is a time consuming process. Computer programmes have to be adjusted in order to handle the matter. In fact, I had not planned to announce the date at all. My duty ends when I have identified, with the advisers, a globular amount and say: “This is what we will be able to afford this year”. If those four colleagues who deal with pensions deem it fit to spread it over the entire year and make it a lower percentage, it is their decision, not mine. However, as a result of certain speculative statements and calculations that were made in respect of the R200 million, I was requested by my hon colleagues to announce that it would only be effective as from 1 October. It was not my idea.

Ever since the implementation of the new dispensation, we have been engaged in an evolutionary process of handling certain of our financial affairs differently from the way they used to be handled. This, inter alia, necessitated the announcement at this early stage.

Secondly, I sincerely believe that it does not behove anybody either to accuse a Minister of Finance of carrying out a “stunt” or to carry out this “stunt” himself as far as this sensitive issue is concerned. I was aware all my hon colleagues shared this conviction with me—that that amount is far too modest and cannot adequately meet the demands made by the increased cost of living. Nevertheless, it is all we can afford at this stage, however much we desire to give more. It accentuates one basic fact in South Africa—I included this in my Second Reading speech—namely that there is a responsibility on each and every individual to provide for his own old age as far as possible. The only alternative is that we restructure our social pension structure altogether and levy contributions, and so on. Still, an investigation is being conducted that is on the verge of completion. This matter should, therefore, be adequately addressed very shortly on the basis of all the available information.

I come now to the second accusation the hon member hurled at me. Why, he asked, was it necessary to announce the allocation of the two amounts, namely, R170 million and R120 million, to farmers? I wish to remind that hon member as well as other hon members who identify with his criticism that, on the basis of urgency, the hon the State President requested his Economic Advisory Council last year to make an economic submission to him on this issue. It is a matter of great urgency, and the hon member for Meyerton debated it in a very acceptable way today when he explained why it is urgent that we address this whole problem of trying to keep our farmers on the land. I do not think anyone can differ with me that that is a basic requirement. The hon the State President having given that brief to his Economic Advisory Council last year, and the Economic Advisory Council already having responded with a comprehensive report at the end of last year this whole matter was handled on the basis of extreme urgency. I want to submit, therefore, that, election or no election, main Budget or no main Budget during the first few months of the year, it would have been necessary for us to address this very issue and to make an announcement about it at this particular point in time. There is no question about it. It was necessary to bring about a degree of certainty that is required in the planning and that is needed in the whole approach to resolving the problems being experienced in the agricultural sector.

I turn now to the question of the loan levies. What I am about to say applies to the other issues that were raised as well. Our whole argument in regard to these concessions is based on our desire to obviate the same kind of mishap that hampered our economic performance last year, namely, the fact that although the economy picked up, the momentum in the resumption of growth faltered, resulting in our having to pump in further amounts. That was the main motivation behind my Second Reading speech.

That we were right was borne out by public comment. I have here in my hand a whole summary of the comments made by many notable commentators in the private sector. Virtually all of them—I have marked it here— placed the accent on what they deemed to be the positive aspect of the mini budget, namely, a further stimulus as far as the growth rate is concerned.

But it is only R280 million.

No, it is not just that. We have to take into account the whole amount, which is close to R1 billion. The fact, however, is that it is all-important that we inject this stimulus into the veins of this economy as soon as possible.

Then you should have reduced GST.

I shall come to GST in a moment. That is why, in view of the fact that we are living in a modern age in which things are done by computer, everything possible is being done to get this injection into the veins of the economy as soon as possible. Furthermore, although these amounts may seem modest, they can help to maintain momentum in the economy. It is not only that, however. When one is dealing with as fragile an economic recovery as the one we are dealing with, what is important is not only the aspect of rand and cents, but also the perceptions of the main in the street. What are his expectations? What does he feel is going to happen? How should he do his planning? Can he expect a recovery? That is why, as far as the loan levy is concerned, we are repaying it now. It was the appropriate time to do so.

Secondly, as for those people who are not intent on spending their money but who want to save it, and who are now running from pillar to post in an attempt to secure an investment that is not so tax-prohibitive, we have told them now that we are going to double their tax-free interest. We would have liked to have given them more. We also had other inputs in terms of where the savings are going, to the effect that we should concentrate on granting a concession as far as interest earnings are concerned, in order to partially redirect the flow of funds. It is also conducive to creating the right kind of atmosphere within which one can develop the confidence in people that the economy is going to recover and that they may plan their own affairs accordingly.

I now turn to the issue of married women. Why should we wait until later this year when we have already announced the concession and when it is possible to put it into effect by way of computers? It is feasible to introduce the concession from day one of the new tax year. Why deny them that cash from day one and accumulate it and give it to them in a lump sum? Once again, this has been designed to maximize the cash flow of this mini-budget package into the economy.

As far as the reduction of GST is concerned, I do not know whether the hon member saw the interview that I had with Jerry Schuitema on television. He asked me this question, and as the hon member obviously did not see the programme, I want to give him this information. As far as I personally am concerned—and my officials can vouch for this—I really wanted the reduction of GST to be one of our primary objectives.

Hear, hear!

I wanted to see it reduced. However, there is no use in reducing it by 1%. In this regard I differ from one of the commentators—I think it was Okkie Stewart. We felt that a 1% reduction would not permeate through to the consumer. It would disappear. It would not go to the consumer.

The Financial Mail says it would help the poor.

Let me tell the hon member what model we proposed. We proposed reducing GST from 12% to 10% and reinstating GST on every transaction. Then at least we would have had a 2% reduction, and that could have permeated through to the consumer. However, our analyses showed that this still would have placed too heavy a burden on the lower income groups; in other words, it would have meant that the lower income group would be paying by way of GST on fresh food, for advantages accruing to intermediate products, capital transactions and so on. That was why we abandoned it. However, we thoroughly investigated that possibility before ultimately deciding that we had a limited amount of money which we had to try to inject back into the mainstream of the economy, but that the way to do it obviously did not lie in a reduction of GST. If we could have reduced it to 9%, then it would have become a feasible proposition.

As far as the report of the Margo Commission is concerned, I have only read most of the English language summaries. I have read most of them already, and my officials are studying them. I have a study group looking into that. In the meantime, the Afrikaans translation is being done. It is a mammoth task. We are not deliberately playing the recommendations close to our chests, but I must take note of them. The Margo Commission is proposing an approach which makes it very risky for us now to tamper too much with indirect taxation or, for that matter, with the taxation of married women. We took into account the possible constraints that the Margo Commission’s recommendations may place on us if, later on this year, we decide to recommend their implementation.

Mr Chairman, may I ask the hon the Minister whether, if he is contemplating accepting the Margo Commission’s recommendations, and if they are as drastic as he has indicated, it would not be honourable to tell the public before the election what he intends to do after it?

We shall tell the public when the report has been properly completed and duly handed over to the hon the State President. It is, after all, his commission. We can see no purpose whatsoever in withholding it from the public. I have, in fact, committed myself on behalf of the Government to giving certain interested parties an opportunity to offer their comments.

Before the election?

It is not possible before the election. We must remember that this commission’s report may in all possibility lead to a major revision of one of the most important things in our economy, namely our taxation system. The Margo Commission considered the whole matter in its entirety.

*That is why we cannot suddenly force the issue, now that an election has been announced. I want to give the hon member the assurance that we want to deal with the report in the most reponsible way, which will serve only the best interests of our country, all its people and also our economy. We are not going to play politics with this issue, not before or after the election. It is too important a matter to be used for that purpose. [Interjections.]

†The hon member referred to certain figures that were allegedly mentioned by Mr Griffiths, a member of the Transvaal Executive Council. I am not aware of that gentleman’s statement, but let me say something about regional services councils. We hope that the regional services councils regulations will be published tomorrow, but they will not contain the percentages. We have already undertaken that, for the first year, the percentages will be limited to 0,25% and 0,1% of the two sources of revenue.

[Inaudible.]

The Minister of Finance has to approve of that, and the Department of Finance also exercises macro control over the spending of it. I cannot see how it is possible, at this stage, to speculate accurately about what is going to happen in the second year or the year thereafter, in terms either of the revenue or of the spending, since we do not have the figures before us. The councils have to be constituted and then have to apply on the basis of the potential of the enterprises in their areas. We are dealing here with a whole array of variables, and I cannot, therefore, reply to the hon member’s statement about R1 billion or R2 billion. I think that would be utterly premature.

But they are your department’s figures!

All I am saying is that we will only be able to calculate the total amounts which those percentages will amount to on the basis of applications from the various regions. I would not like to enter into a political debate with the hon member, so I shall leave the matter right there.

I would, however, like to say something about his challenge. My purpose in challenging him was to restrict his debating in this House to the same kind of disciplines as those to which I am restricted.

You won’t put your money where you put your mouth.

The hon member has the advantage of never committing himself. When the time comes, a year afterwards, he sits there as if he had known everything in advance at the time of the previous year’s debate. [Interjections.] I would like to tell him that my purpose was not to embarrass anybody or to make a childish little game of this; it was to get that hon member to commit himself publicly, as I am forced to commit myself. [Interjections.]

I was rather unhappy to see that the hon member does not make use of advisers. Heaven forbid that we in this country should ever have a Minister of Finance who feels that he does not need advisers! A Minister of Finance who does not listen to a whole array of economic schools of thought will definitely become the victim of a specific school of thought and that is not the kind of management of the economy that I believe will be in the interest of this country.

Your advisers are all of the same school.

Let me tell that hon member in all sincerity that we, and I personally, would like to see his debating return to the quality that we were used to. We have not been getting that in the last few debates. I can say in all sincerity that I personally and my advisers used to take serious note of what the hon member for Yeoville said inside or outside the House. Lately, however, we have tended to lose that desire. I think the hon member owes it to himself, to this House and to the purpose of this House to return to that kind of debating, and we are looking forward to that. If, in the process, he scores more than the one point which he did in this particular debate we shall be more than happy to concede it. After all, that will be in the interests of South Africa.

*I should like to congratulate the hon member for Bloemfontein North very sincerely on his appointment as ambassador. We all know him to be a well-mannered person. We have every confidence in him and in his ability to deal with the delicate relations in Africa very easily. We look forward to leaving that very responsible position in his competent and responsible hands. We shall rest assured when he is occupying that particular post and we should like to wish him everything of the best. We look forward to watching his performance in that new field of endeavour in which he is going to bat for South Africa.

I should like to tell the hon member for Meyerton that I had great appreciation for the first quarter of his speech. I am not going to talk politics to him because the kind of arguments he advances do not worry me at all, but I do want to say that I appreciate the way in which he discussed the whole question of assistance to agriculture. We are definitely in full agreement about the extreme need to maintain this resouce in our country. What he said about there being a large percentage of farmers in many areas in this country that are staring financial ruin in the face was quite true. This industry is facing a crisis, as many others are. But the hon member raised the key argument himself, namely that if one has food, one has bargaining power. That is what distinguishes that particular industry from other industries, and that is why I agree whole-heartedly with him. I appreciate his having expressed his thanks for the assistance that has been rendered. I agree with him that if one only has modest means, one cannot live high off the hog’s back. We simply have to live within our means.

†The hon member for Umbilo does not believe that inflation will come down on account of excessive Government spending. That has become a slogan and a cliché. I should like to hear in greater detail what the hon member regards as excessive Government spending. Let me tell him that it is no mean feat to try to put together a budget in South Africa which addresses all our problems and does not involve excessive spending at the same time.

[Inaudible.]

I did not interrupt the hon member when he spoke.

But you asked me to tell you what I meant.

The hon member can tell me later on.

I tried to help you.

I would have thought that he would have needed a whole speech to go into excessive Government spending. It is not something that one can deal with in a few sentences.

You have 30 minutes, I had seven.

I promise I will not spend more than seven minutes replying to the hon member. [Interjections.]

I do not think it is fair electioneering to accuse this Government of manufacturing inflation. Let me quote from my little screen in my office—International Economic News—

The point I want to make here is that in economic policy there is no clear-cut line of policy that can address a particular issue and eradicate it without causing an enormous number of adverse side-effects. We can kill inflation but we will inflict damage on this country as never before. I have tried on several previous occasions to explain to this House and to the hon member that it is a matter of choice between a number of prices that one has to pay when applying proper economic policy for our particular situation. If we had had a sophisticated and well-funded social security system we could have embarked tomorrow on a campaign to kill inflation and we would have been able to cope with much larger unemployment figures than those we have to cope with right now. However, we have to achieve a balance between the price that we pay for our adjustment period in terms of inflation, currency, unemployment and so forth.

If we were the manufacturers of inflation we could have just stopped our manufacturing process and we could have had all the benefits of the low inflation rate tomorrow. However, we are not manufacturing it and causing it purposely; we are dealing with that situation as best we can. I have quoted before in this House a noted economist in South Africa who will remain unnamed, telling me that according to his calculations and taking into account the dramatic drop in the value of our currency and so on, South Africa’s inflation rate should really have been much higher. I quoted to the hon member weighted averages of the IMF according to which, relatively speaking, this country is performing reasonably well compared to comparable countries. I am prepared to accept on behalf of the Government the criticism levelled at us as a result of the relatively high rate of inflation. However, what are the choices open to us? I am afraid the hon member did not adequately debate that part of the question.

As far as his statement on the kwaZulu-Natal Indaba and the costs are concerned I would like to share with him a problem that I have in my job. I am talking about the difference between demands for equalisation now or in the very near future, and the ability of the economy through growth or new development to pay for it. He can wax lyrical about the potential of the Tugela Basin, and we could all do that about the rest of South Africa, but if the Tugela Basin development starts tomorrow it will take a considerable period of time before it generates sufficient funds in order to afford the kind of equalisation policies that were expounded here.

I deny that this mini-budget is a blank cheque. Like any other mini-budget it is designed to identify an amount of money. Contrary to other mini-budgets we went further with this one than we normally do since it is an election year and because of that we will not have an opportunity in the near future in the main Budget to give an analysis of the economy. We gave an analysis, albeit a brief one, of the economy as we see it today. It is not a blank cheque; how can it possibly be one? The main Budget is coming. I would caution the hon member not to exaggerate by way of his description of possible overspending. I am not promising him anything but I want to give him a word of caution. He must not be so sure that we are not getting the expenditure of our various departments under very good management.

Business interrupted in accordance with Rule 45 (2).

Question agreed to.

Bill read a third time.

Mr Speaker, I move:

The De Kock Commission of Inquiry into the Monetary System and Monetary Policy in South Africa proposed in paragraph 6.67 of the final report that the Minister of Finance should initiate, at the earliest possible opportunity, an investigation into the desirability and feasibility of transferring supervision of the domestic operations of banks and building societies from the office of the Registrar of Financial Institutions to the SA Reserve Bank so as to enable the latter to exercise overall supervision of these institutions.

In pursuance of this proposal the Minister of Finance appointed a committee under the chairmanship of Dr A S Jacobs, Senior Deputy Governor of the South African Reserve Bank, and including officials of the Department of Finance, the Reserve Bank and the office of the Registrar of Financial Institutions to investigate the matter.

In its findings the committee recommended that the supervisory function in respect of banks and building societies be exercised in toto by the South African Reserve Bank. This recommendation was based on the following considerations:

The Government has accepted the findings and recommendations of the aforesaid committee. Consequently, the provisions of the Bill now under consideration provide for assigning to the South African Reserve Bank the administration of the Banks Act of 1965, the Mutual Building Societies Act of 1965, and the Building Societies Act of 1986. Furthermore, the Bill also includes consequential amendments to the South African Reserve Bank Act of 1944, the Inspection of Financial Institutions Act of 1984, and the Financial Institutions (Investment of Funds) Act of 1984.

*It should be emphasized that in the execution of its supervisory functions in terms of the Banks and Building Societies Act the Reserve Bank, as is at present the case with the Registrar of Financial Institutions, will remain responsible to the Minister of Finance. The various associations of banks and building societies have expressed their support for the transfer of the supervisory function from the registrar’s office to the Reserve Bank.

I now turn to the proposed amendment in clause 21 which amends section 6 of the Finance Act of 1978 relating to the activities of Sasria. Sasria is a registered insurer established by the short-term insurance industry for the purpose of underwriting special risks which the Government then reinsures.

The Finance Act of 1978 authorizes the Government to provide this reinsurance. It also determines the scope of the reinsurance, thereby determining the extent of Sasria’s operations.

Initially the Government’s authority to provide reinsurance cover for Sasria’s operations was limited to losses of, and damage to, property caused by political riots and other politically inspired acts. This restriction caused practical difficulties, as when claims arose which required Sasria’s liability to be distinguished from that of the insurers who covered the non-political losses and damages. In an endeavour to resolve this problem, the restriction on the reinsurance which the Government could provide was partially relaxed so as to enable the Government, and consequently also Sasria, to extend their cover to certain non-political losses and damage.

The cover as at present formulated in section 6 of the Finance Act caused problems of definition and interpretation, and the proposed amendment in clause 21 was designed to remedy the shortcomings in the formulation of this cover. However, the standing committee proposed an amendment to this clause which once more limits the cover to loss and damage related to political riots. I am prepared to accept this amendment but must point out that should available information be confirmed later this year, namely that this cover is not readily available in the open market, it will be necessary to approach Parliament again for the amendment of the clause as originally proposed.

I also accept the other amendments of the standing committee as proposed and wish to thank the committee for their contribution in this regard.

Mr Chairman, we support this measure. It really consists of two particular aspects which we would like to deal with separately. The first is the question of bringing banks and building societies under the control of one authority namely that of the Reserve Bank. This proposal emanated from us—we have asked for it over a long period of time. It is supported by a commission which recommended it. It is therefore a desirable measure and it is a pity that it has taken so long to come about. It is also a pity that it has come about largely because of troubles that we have had in the banking system in South Africa.

We believe that by passing this measure we will have a better control of banks and building societies. In the long run we will have a saving of manpower and of funds as it will become cheaper. The co-ordination of information and the situation of being able to look at a bank or building society in its entirety with all the information that needs to be furnished is obviously a desirable situation. Up to now one has had returns made to both the Registrar and to the Reserve Bank. In future one will have one set of returns and one will be able to see the whole picture. One will have one set of inspectors dealing with it and this is unquestionably a desirable matter to support.

May I, however, utter a word of caution. I think it is important that we do not have a duplication of staff and unnecessary staff appointed as a result of this. One hopes that the staff who will attend to this will be properly paid so that we will be able to attract the kind of people we need and that we will not have the problem that has existed in the office of the Registrar where a person could be transferred from a department that is totally unconnected with finance to the department of the Registrar. When he shows his skills there he gets transferred to another department where he cannot use his acquired skills. I would imagine that we would be able to attract to the Reserve Bank suitably qualified staff who will soon pick up the necessary experience. To some extent it is perhaps fortunate that the opportunity to shift people in and out of the Reserve Bank is not as readily available as it is within the Public Service. I do not want to quote particular examples but I think hon members will know what has happened in the Registrar’s office over quite some period of time.

Even now where the process of removing banks and building societies is under way, the office of the Registrar is still not adequately staffed and it still needs to be looked after. I hope the new Deputy Minister under whom this now falls will look into the matter and see to it that the Registrar's office, now that it is relieved of some of its work, will not be treated as some kind of orphan that one does not look after properly. I think that office needs to be looked after properly and it needs to be properly staffed.

When people are busy with regradings and are looking at what one has to pay people I think that office needs to be looked at to ensure that staff with the right qualifications are attracted.

When one looks at the Acts that prompted this matter one finds another matter that needs to be examined. I hope—I am not certain—that we will get answers to some of the problems which actually caused this legislation suddenly to be introduced now. We see that we have paid a very heavy price for this when we look at what happened to the banking sector in South Africa.

When we opened the banks to allow them to operate to a greater extent on the foreign exchange market, the then Minister of Finance promised this House and the public of South Africa that it would be properly monitored. He promised us that because from these very benches I warned him and said that the most experienced banks in the world had made mistakes in regard to foreign exchange and that the most experienced people had lost vast sums of money. I told him that he was allowing these banks to enter this field to a greater extent and I said that the situation should be monitored.

In great indignation he asked: “Do you think we would allow this to happen without having the necessary machinery to monitor it?” The reality is, however, that when eventually the problem arose which caused the bank standstill for which the whole of South Africa has had to pay, it appeared that not only had he not monitored it, but he also did not even have the machinery to monitor it! Both this House and the public of South Africa were grossly misled with regard to this matter, and it has cost South Africa dearly, because this is one of the major causes of the bank standstill. It is one major factor which caused our credit worthiness in the world to be queried. Now we find they admit that, yes, it was wrong to allow the banks to borrow short and lend long.

Any person involved in banking, whether local or international, anyone who had read any textbook on the matter, would have been able to say that anybody who borrowed short and lent long was skating on thin ice. There have been international banks that had gone bankrupt because of this very fallacy, this very mistake, this biggest and most obvious blunder that could be made. What was allowed to happen in South Africa was that banks, and one bank in particular, were allowed to borrow short and lend long, as well as to have foreign exchange exposures which were not fully covered. The tragedy is that the price has been paid, not merely by the bank, the shareholders and the new shareholders, but by South Africa as a whole. This is what precipitated, to some extent, the whole question of this legislation. We have paid a tremendous price for this.

There are many things relating to the whole question of exposure to foreign exchange which we need to look at and to examine. Let us take another example. Let us consider the removal of exchange control with regard to non-residents, which has been described by people from the Stellenbosch economic bureau as one of the biggest blunders that have ever been committed in the financial history of South Africa. Other economists will tell us exactly the same thing. What did they do? They allowed exchange control to be removed for non-residents, who sold their shareholdings in major companies and removed the money from South Africa in ordinary commercial rand. What did South Africa do? The money was replaced, and proudly we were told we had lots more money that had come in. However, the money was replaced with loans, many of which were shortterm loans. The result was that the assets of South Africa were allowed to go out of the country because exchange control was removed.

Then, when this whole debacle came about with the debt standstill, exchange control and the financial rand were reimposed, and we were told that the only reason why this was done was to prevent people from converting loans into shares and getting their money out that way. That is the biggest baloney one has ever heard in one’s life because it is applied to a whole variety of transactions where the financial rand is used.

Now we have another disaster concerning the financial rand, namely that one may use the financial rand today for the purpose of investment not only in the Stock Exchange but also for the purpose of investment in other ventures. Where those ventures are job creating ventures, they have our support, because one wants to encourage people to come here to establish industry and businesses so that jobs may be created, which is one of the major priorities for South Africa not only economically but also politically. While unemployment exists at the levels at which it does, the stability of the country is endangered.

But no, Sir. The financial rand may now be used in order to buy farms, for instance. In some respects—I think the examples can be given—things which are part of the national heritage of South Africa are being sold for a song through the financial rand. How can that be allowed? How can it be allowed that some of our most beautiful farms in the Western Province, some of our heritage of the past, are actually given away at very low prices because, as hon members know, the value of the financial rand has even been below 20 cents to the rand, and people have been allowed to use that at least in part in order to purchase what are valuable assets for South Africa.

I can give hon members examples of cases where people could not bid against foreigners when bidding in respect of property. South Africans cannot bid against them because money is being used at 20 cents to the rand in order to buy assets. That is like a break-up insolvency sale! I do not believe that South Africa should be in that position. These are our assets. This has to do with the heritage of South Africa and I do not believe that it should be given away.

I want to say to the hon the Minister, or to the two hon Deputy Ministers who are both here, that I hope they will look at this, together with the Reserve Bank, because this is really an unsatisfactory situation.

Insofar as the financial rand is concerned, this is the correct thing to do with regard to stock exchange investments. Also, when people want to sell assets in South Africa, they must be able to take the proceeds out through the financial rand. When you want to create jobs, Sir, by all means create an attractive mechanism by which it can be done, but please guard the assets of South Africa.

We are not always going to be in financial trouble. There will come a day when South Africa will be able to hold its head up again and when things will be better. However, Sir, I really feel very strongly about this issue. I would imagine that particularly the farming element in South Africa, whether their representatives sit on the NP, CP or NRP benches, should be kept together with us in order to see to it that our heritage is not sold.

I agree, Harry.

Thank you. At least I now have one supporter in the NP—an old Nat who has New Nat ideas on some things.

An old CP member!

An old CP member; the hon member is right.

I welcome things which are part of an approach in a new direction. Where we are now told, for instance, that there are going to be more sophisticated approaches in regard to our foreign exchange, covering situations and to a real understanding of how the foreign exchange markets of the world work, I hope that the two hon Deputy Ministers— the one in particular whose job this is— together with the hon the Minister, will see to it that we become more sophisticated and effective as a country when it comes to the handling of foreign exchange.

I want now to come to the other part of the Bill which is the last section of this Bill. This is the famous Sasria story. There is a fundamental principle which is at stake here. When the proposals in respect of the establishment of Sasria were initially brought before the House, the argument was advanced that certain political risks existed which could not be insured. It was argued that, to some extent, they were the responsibility of the country as a whole and, therefore, the taxpayer had to be the final underwriter in respect of those risks; in other words, the taxpayer would be an underwriter or banker of last resort in respect of political risks.

The issue was then broadened. Instead of merely dealing with damage caused by a political riot or commotion, it was extended to deal also with things such as labour unrest, strikes and lock-outs because again there was difficulty in covering that kind of situation. However, fundamentally, insurance is not the business of the State. The only reason why the State goes into insurance is because this is a political issue, because they cannot get the cover elsewhere and because there is unrest in South Africa. There is a high level of risk and it is therefore difficult to ask South African companies to carry that risk themselves. It also difficult to get the underwriting overseas when it comes to political risk.

However, to then start extending it to go into the field of private enterprise is something which is utterly unacceptable. I want to give hon members a couple of examples. Pressure has been exerted on the standing committee, evidence has been heard, letters have been written, telephone calls have been made and the pleading has taken place because the idea has been that we should now cover all public liability risk, and that the taxpayer should, in fact, be the underwriter of last resort in relation to this.

I want to ask you a question, Sir. There sits the new hon Minister of Economic Affairs and Technology. If his dog bites you, why is that a matter for the taxpayer? That is a public liability issue which has nothing to do with the taxpayer. One option open to the owner of the dog is to get cover for that. In South Africa he should be able to get cover for that. If not, he must take the risk himself. To expect the taxpayers of South Africa, however, to cover dog bites, I believe, is totally ludicrous.

Let me give another example—a quite different one. If the hon the Minister of Constitutional Development and Planning were to go to a wrestling match, and while he sits there watching the wrestling match—and I imagine enjoying it—someone throws one of the wrestlers out of the ring right on top of that hon Minister, as happens, Sir, and he gets injured and his beautiful suit is damaged … [Interjections.]

Order!

… in those circumstances, Sir, why should the taxpayer pay for his damage and for the fixing up of his beautiful clothes, which he buys at those expensive shops? [Interjections.] It is not a political risk. He is a political risk but that is not a political risk. [Interjections.] When he goes to a wrestling match he is not funning a political risk. Why does that have to be a risk that has to be covered by the taxpayers? He can insure himself. The wrestling promoters can insure themselves. If they cannot get cover in respect of wrestling where people get thrown out of the ring … Well, that is purely bad luck. Then they simply have to move the hon the Minister of Constitutional Development and Planning a bit further back so that he does not get hit by the wrestlers who get thrown out of the ring. That, Sir, is a second example.

Let me give the House a third example, which is a very real one. That is the example of a soccer match.

Order! It is amazing how Constitutional Development and Planning seems to creep into every debate in this House.

It does, Sir. It is amazing indeed.

Order! The hon member for Yeoville may continue.

That hon Minister has his tentacles everywhere, Sir. [Interjections.]

Order!

Let me, however, give you another example, Sir. Let us take soccer as an example. Soccer in South Africa has become a big spectator sport. As happens in South Africa, however, people get worked up at soccer matches. Whether that is right or wrong is another story. I believe to some extent it is a very wrong thing. Obviously control must be exercised. One must have security measures and so forth. If, however, there is a riot at a soccer match, what has that got to do with politics? Whether Kaiser Chiefs or Rangers win is not a political issue. They want that risk, however, to be covered. Now the Government comes along and says in all piousness all these risks have to be covered because particular risks cannot be covered separately.

That is because of the reinsurance problem.

No, just a minute, please! They do not want to separate the risks. They want all risks to be together. They want to go abroad in order to obtain reinsurance for the whole lot together. I am saying to the hon the Minister that in South Africa we can firstly cover our own risk, which is not a political risk. We can do so because the element of cost involved is not excessively high. The element of what has to be paid out is also not excessively high. Secondly—I took the trouble to make inquiries overseas myself—there are overseas insurers who are quite happy to cover public liability risks which are of a non-political nature. They do not want to cover political risks because they are afraid since they see what is shown on television in relation to what happens in South Africa—things which we do not see. Some of them have reacted to what they saw on television in the past, and they are afraid to cover such risks. Non-political risks, however, they are prepared to cover.

To my mind, however, the whole issue here is one of free enterprise. We are talking about the fact that we are going to deregulate. We talk about privatization. Yet, here we have exactly the opposite. It is unbelievable how much pressure is being exerted by the short-term insurance industry in order to try to get the Government to agree to this underwriting involving the tax payer. I must say that the policies which are issued put the onus on the people who claim. They have to prove whether it is a political risk or not, which means the onus of proof is reversed. They do in fact want to get the taxpayer involved in this, and I must tell you, Sir, that if there are insurance companies in South Africa that have come together and that do not want to do this, the Registrar of Insurance and the hon the Minister should tell us something about allowing new registrations of insurance companies that are prepared to underwrite this type of risk. I ask this because in the insurance industry in South Africa the short-term industry cannot just select what it would like to insure. They have to take risks some of which are bad and some of which are good. For some risks they have to charge a higher premium than for others. If they want to be in business, however, they have to accept the fact that they have to cover all risks, and to my mind we have now time after time withstood this onslaught on the Standing Committee on Finance. They are determined. They get the people. They push one in order to get one to agree to this. If we want to accept the concepts of free enterprise, we must keep out of this business and not allow the taxpayers to underwrite it. Let us cover political risk for we have to because of the difficulties of South Africa. Let us keep out of the other business.

I therefore have pleasure in supporting the provisions of the Bill as they stand now. However, I give warning that if they come again with more pressure, I expect the support of this House on a non-political basis. I think we should agree that in a commercial situation that is not connected with politics we do not get the taxpayers of South Africa involved.

Mr Chairman, I thank the hon member for his support of this Bill.

Are you also supporting it?

Just wait a moment. Give me a chance.

I should like to place on record that the hon member for Yeoville is not only Deputy Chairman of the Standing Committee on Finance, but also makes an exceptionally valuable contribution.

Hear, hear!

He makes a contribution of a high calibre. For that I want to thank him personally this afternoon.

We heard what he had to say here this afternoon. A man who thinks clearly can reason clearly.

You are pally-pally with the Progs.

I shall also be speaking about that hon member at a later stage. Just give me a chance.

The hon member for Yeoville unfortunately referred to several “disasters” and some of them may be true. It is a pity, however, that he did not discuss further examples of disasters he was involved in. That is all I want to tell the hon member.

On the strength of the recommendations by the Commission of Inquiry into the Monetary System and Monetary Policy in South Africa, an investigation committee was appointed under the chairmanship of Dr Jacobs. This committee’s recommendations to the effect that supervision of banking institutions and building societies should be entrusted to the South African Reserve Bank were accepted and are embodied in this Bill. The Bill therefore makes provision for the implementation of the Banks Act, the Mutual Building Societies Act and the Building Societies Act to be entrusted to the South African Reserve Bank. It also makes provision for the designation of a Registrar of Banks and Building Societies. This Bill also amends the South African Reserve Bank Act to empower the bank to appoint inspectors. Secondly it amends certain provisions of the banks and building societies legislation to make provision for the appointment of registrars and deputy registrars. Thirdly, certain administrative functions, at present performed by the Minister, are being entrusted to the registrars.

The hon member for Yeoville discussed the new clause 18 at length and in detail. He was even verbose. I therefore want to content myself with agreeing with him and pointing out that the amendments, as embodied here, were unanimously adopted by the committee, the committee as a whole being convinced of the fact that they embody the correct principles. And that is my reply to the hon member for Umhlanga.

I thank the whole House sincerely for its support of this Bill.

Mr Chairman, we are unfortunately going to vote against this Bill and we shall now say why. Here we have … [Interjections.] No, I raised my objections and expressed my concern on the committee.

It is true that the building societies and banks are being removed from the control of the Registrar of Financial Institutions and being placed under the control of the Reserve Bank, as the hon members for Smithfield and Yeoville have said.

Let us first look at what the hon member for Yeoville said. He said that the people who would now be appointed to the Reserve Bank would receive proper salaries. They would be competent and would be good officials. They would not just be transferred again and have to move away to accept other posts. He also referred to officials only having such unpleasant experiences in the Office of Financial Institutions because of having been transferred, etc. I think it is a great blot on the name of the Registrar of Financial Institutions. If the hon member for Yeoville is correct—I shall not say he is wrong or anything like that …

That is correct.

If he is correct—he says it is correct—I want to know what is going on in the Public Service. Why does the Commission for Administration not ensure that the right staff are appointed to deal with this situation? Now it is only two financial institutions, banks and building societies, which no longer fall under that department. What is now going to happen to all other financial institutions such as the insurance industry and pension funds? Are the poor conditions pervailing in the Office of Financial Institutions now simply going to continue, or are there going to be improvements?

Let us first take a look at the Reserve Bank. In the past control was vested in the Registrar of Financial Institutions. The Standing Committee on Public Accounts could call that department in if there was anything wrong, and we could go into certain matters. The Reserve Bank, however, is not under Parliamentary control. Its accounts are audited by private auditors and not by the Auditor-General. Therefore the Auditor-General does not report on this to Parliament so that that report can be conveyed to the Standing Committee on Public Accounts which can then call the Reserve Bank in and go into the matter. It is true that annually, with the Appropriation, we do call in the Reserve Bank, but its contribution involves other matters such as the Appropriation, etc. The Reserve Bank’s financial statements are not, however, audited by the Auditor-General and the Reserve Bank does not have to appear here, as does an ordinary department, if there are discrepancies.

Now banks and building societies are being placed under the Reserve Bank’s wing and are therefore beyond the ambit of Parliamentary control. This implies a tremendous concentration of big money, without this Parliament having a say or without its being open for Parliamentary inspection. I say that is wrong. It is an anomaly. We cannot restrict or reduce this Parliament’s powers so that it no longer has any say as far as those matters are concerned. I want to mention an example on the strength of something that happened recently. It appeared that a certain Mr Lombard was involved in an incident in connection with the financial rand, when things went wrong to the tune of something like R20 million. I immediately sent a letter to the acting State President, Mr Hendrik Schoe man, requesting that a Parliamentary committee be appointed to investigate that matter.

Just the other day I received the letter from the hon the Minister of Finance in which he said that it was not going to be done because he had appointed two outside businessmen who had already submitted a report in December. They issued a statement to the effect that nothing was wrong. During that period, however, there were many overseas visitors and businessmen here. One of them asked me a few very strange questions about that situation involving the Reserve Bank. We as a Parliament have no power or authority to look into that. [Interjections.] If we are only to appoint committees of outside businessmen to investigate such matters, what is going to happen to these other matters in the future?

So, unless the hon the Deputy Minister gives the undertaking that the Reserve Bank’s statements will be audited by the Auditor-General, we cannot vote for this. It is true that the Auditor-General can make use of the auditors who do the work at present, or others, but their reports must come to the standing committee via them. That is the correct procedure. We are therefore not depriving the Reserve Bank of those auditors. They still remain private auditors, and we cannot say that the work will not be done by them, but Parliament will not lose its powers in regard to these matters.

Oom Jan, you are all mixed up now. Begin again.

No, Sir, if the hon the Deputy Minister is mixed up it is because he does not know all that much about these matters. He knows a great deal more about the medical profession and other matters.

Which of the 50 Deputies is he?

That is very difficult, because we have a vast number of Deputy Ministers. There is such a vast number of Deputy Ministers that one does not always know who is who either. These days they are actually glorified NP organisers. [Interjections.] I should like to know from the hon the Deputy Minister whether he is going to undertake—I raised this in the standing committee too—to have the Auditor-General do the auditing? If he does not want to do so, we shall be voting against the Bill. [Interjections.]

Mr Chairman, the hon member for Sunnyside has problems with the fact that the Reserve Bank will now supervise the activities of the Registrar of Financial Institutions, and specifically in regard to banks and building societies. At a later stage I want to come back to his arguments.

It is very important for us to view this whole measure in the right perspective. It is actually a very fundamental and important measure that we are dealing with here, because when the Building Societies Act of 1986 was passed, and also the Mutual Building Societies Amendment Act of 1986, provision was made for further, extended powers and functions in regard to the relevant building societies. There was consequently a shift in the functions traditionally carried out by the building societies in the past. Building societies are now beginning to arrange their own affairs in such a way as to enable them to accept this increased responsibility and offer these additional services. Hence the necessity for the incorporation of control measures that can be dealt with by the Registrar of Banks and Building Societies. It is just necessary for the functions of these two institutions to be co-ordinated and controlled by one registrar.

Because the Reserve Bank—and this is the reply to the hon member for Sunnyside’s argument—is the credit grantor, when all is said and done it is only logical that the Registrar should perform his functions under the control and supervision of the Reserve Bank. That is made possible in this amendment. We should like to support that because we acknowledge the responsibility that the Reserve Bank has when it comes to granting credit. The supervision and the ultimate responsibility therefore rests with them.

Building societies are now, to a large extent, entering a field that has traditionally belonged to the banks. Likewise there is a tendency for the banks to enter the field occupied by building societies. I foresee this eventually leading to healthy competition, and also ultimately to the furnishing of a proper service by these two bodies.

One of the banks reacted, as early as a month or two ago, by dramatically reducing its bond rates. Of necessity this resulted in other institutions having to follow suit more quickly than they had perhaps planned to do. That was a sound step in local financial circles. Naturally bond-holders are grateful for that step, and also for the resultant chain reaction in interest rates.

I also just want to refer briefly to the new clause 18 which amends section 6 of the Finance Act. It is clear that there are increasing problems in the field of short-term insurance. The prospective client—the future insured—can no longer freely and without effort negotiate the articles he wants to insure. At the moment this dilemma is manifesting itself on a wide front in the insurance industry. Insurance companies are simply no longer ready to go ahead and provide high-risk insurance. Coupled to that there is the alarming increase in premium rates, which makes it virtually impossible for those who want to insure to manage the premiums. On the other hand, of course, we must inevitably consider the increase in risk to the insurance companies. For the new client it is a real problem, as things stand at present, to gain easy access to proper motor vehicle insurance or insurance against damage to property. For every new client it is really a problem to obtain this kind of insurance.

Therefore, in view of the problem that has now developed in regard to this measure, a problem about which the standing committee has made a statement, I think it is necessary to take an in-depth look at the whole matter. One should consider the whole concept of short-term insurance. I therefore want to appeal to the hon the Minister and the hon the Deputy Minister to see whether the time has not come to investigate the whole field of short-term insurance so that the obstacles can be identified and so that one can look for possible solutions that will make it easier for those, who want to take out insurance, eventually to obtain their insurance on reasonable terms. I am also asking that the new problems be examined to see whether solutions are not readily available.

I think there are certainly solutions as far as these problems are concerned, but I think it is equally necessary to have top-level efforts made to examine the problems.

With these representations, Sir, we on this side of the House should like to express our support for this measure. We also express the hope that in future short-term insurance will be more readily available.

Mr Chairman, I do not have a great deal to say about this Bill that has not already been said by the hon members who have spoken before me, particularly the hon member for Yeoville. I think he squeezed every little drop of juice out of this particular lemon. He did it very effectively too, I might say.

This Bill seeks to control these financial institutions and to protect the public against either the stupidity or the cupidity of these people. It is thus very necessary, and we on these benches will support it.

I should also like to comment on clause 18 and warn against the Government’s getting involved in this type of insurance. It may be necessary insofar as it goes, but I believe that, if we are going to subscribe to the precepts of the free enterprise system, we should be extremely careful when entering into this sort of deal.

With those few words I would like to indicate that this party supports the Bill.

Mr Chairman, I should like to thank all the speakers who expressed their support for this Bill. I want to single out the hon member for Sunnyside since he has a problem which I shall come to in due course.

†I must say I agree with the hon member for Umbilo where he says that the hon member for Yeoville really dealt with this Bill in great detail; in such great detail, in fact, that I may need more time than I have available in order to answer him on all the points he made.

I should like to start with his first point. He stated that we took a long time to bring this Bill before Parliament, and that it was only because of some trouble we had with the banking system that we now have the Bill before us. Considering the economic conditions that prevailed over the past two to three years, however, it is understandable that problems were encountered in the banking sector. Moreover, with deregulation and diversification taking place in banking one finds, especially in the Western World, that the governments, particularly the reserve banks, tend to re-examine the whole question of controls.

*We know about the scandals which happened “in the city”, as they say, as well as in the USA. It has a bearing on this whole development of deregulation. That is why I think it is essential that we take away these functions from the Registrar of Financial Institutions and transfer them to the Reserve Bank. I therefore do not believe that it is merely a question of the difficulties in our banking which have now suddenly caused this Bill to be before us. It is rather the whole development in banking and in banking diversification that has caused it. I am thinking for example about the question of deregulation in terms of which building societies are now permitted to enter other fields.

†I support the hon member for Yeoville’s statement that we must look after the staff of the Registrar of Financial Institutions. I also wish to thank them for the excellent work they have done over the years. I must say that they have been the watchdogs of the South African economy, and we must extend our appreciation and our thanks to them for the work they have done up to now.

*The hon member for Yeoville also placed very strong emphasis on the problem of diversification with the development of branches overseas. He emphasised that it was as a result of poor control on the part of the Reserve Bank that we had acquired these problems in terms of the moratorium and the fact that we could not obtain loans from banks in the United States. To a certain extent I have difficulty with this, because does this situation represent the chicken or the egg?

†I have a feeling that it was because the Chase Manhattan Bank decided to stop all new loans to South Africa and to call in their existing loans that the specific branch which the hon member had in mind found itself in difficulties.

It was short term.

I agree with the hon member that it is always dangerous to borrow one’s money on a short-term basis and to lend it out on a long-term basis. I agree with that. If it had not been for the decisions made by the Chase Manhatten Bank, however, I think this branch could have got through, to some extent, the difficult period they experienced later.

I would also like to ask, while we are on the subject of controls, if it is possible for the Reserve Bank to know what is going on on the board of a bank. Maybe we can talk about it later, but does the hon member for Yeoville think that all the directors of this bank knew about the branch activities in this particular country? If one is going to have perfect control, one may be forced to appoint, as the banks do in Japan, directors on the boards of all their main clients. It is not possible, therefore, to attain the perfect control which the hon member for Yeoville has in mind.

The hon member also referred to the question of decontrol on foreign exchange transactions, and he mentioned that we had lost a lot of capital because of this decontrol. We did indeed experience a big outflow of money but, if one analyses the international world during this period—I am thinking particularly of New Zealand and Australia—they all started to decontrol in regard to foreign exchange transactions. I think it became the general monetary policy in the Western World to have a free-floating exchange rate. Most countries decided that, with such a system, they could remove controls and allow foreign exchange to find its own level on the open market.

Both the countries you mentioned got into trouble, and they did not even have our political problems.

Surely we agree that, if one can succeed in having one’s foreign exchange rate determined on an open market, one has a better system. It was because of political factors that we were forced to reintroduce controls.

* As far as property is concerned, obviously no one wants our farms, which have been in the possession of old families for a long time, to be sold to foreigners.

†We do have some control, however, over the use of the financial rand to buy property in South Africa. One has to apply to the Reserve Bank if one wants to buy property in South Africa with financial rands. Moreover, it is done on a 50-50 basis—50% commercial rand and 50% financial rand. One of the main criteria in using financial rand is whether the investment will create more employment.

How can you create more employment by selling a wine farm?

I agree with the hon member for Yeoville that we must be careful. We cannot allow transactions such as that he has just mentioned in which our wine farms end up in the hands of business people from Hong Kong. At the moment this sort of transaction has to be approved by the Reserve Bank. They must apply to the Reserve Bank and it has to be on such a 50-50 basis.

*Today I should like to thank the hon member for Smithfield for the years during which I was able to serve under him. It was a pleasure and an honour and I believe that he taught us well. We wish him everything of the best now that he, as a former mathematician, former politician and former Wilgen hoffer, is going to spend his days on the farm. He gave us an explanation of what the organisation was going to look like and we thank him for his contribution. We shall miss him.

He will now be dealing with a different kind of sheep.

My colleague next to me says that he now will be dealing with a different kind of sheep.

The hon member for Sunnyside also served for a long time with me on the committee. May I now ask him whether he ever asked the Registrar of Financial Institutions on the committee whether we could have private companies such as the United or the Perm appear before us in order to question them about their private investments or their financial statements. I ask the hon member for Sunnyside whether we ever did it.

We had the power to call for …

The Registrar of Financial Institutions never brought the financial statements or even the auditors’ reports of private firms before this committee. We discussed policy on the committee. The same applies to the Reserve Bank. The Standing Committee on Public Accounts’ function has never been to look at the Reserve Bank’s financial statements; for that they have their own auditors. We did, however, look at policy and that is why after the budget we often had the president of the Reserve Bank with us to come and defend his monetary policy to us.

We are now removing part of the functions of the Registrar of Financial Institutions and transferring them to the Reserve Bank, but I think it is still possible for policy to be dealt with. The president of the Reserve Bank is in the final analysis still responsible to the Minister of Finance. When the hon member for Sunnyside, however, asks for an in-depth investigation into the financial statements of the Reserve Bank, he is asking, in my opinion, a little too much. I think he still has the right to hold a discussion on policy after the aforesaid transfer has taken place. The President of the Reserve Bank will still be there to answer his questions. What the hon member should realise, however, is that we started to experience a tremendous amount of duplication. On the one hand the Registrar of Financial Institutions has to see to certain banking activities, but the Reserve Bank should do the same. The Reserve Bank also has other functions which it has to carry out. It has to look after liquidity, solvency, and there are also reports which banks have to submit regularly. That means that we in fact started to have an overlapping and duplication of functions. I think it is an exceptional improvement that we are engaged in at the moment. In other countries as well one finds a greater measure of centralised control being exercised. It does not in the final analysis mean that the Standing Committee on Public Accounts are unable to discuss matters, but I think that the hon member is taking it too far by suggesting that the Reserve Bank should present its financial statement to the committee. It in fact has nothing to do with the matter.

Mr Chairman, may I put a question to the hon Deputy Minister? When there is theft or other irregularities in the department, the Auditor-General reports it and in so doing we can get at those people. If fraud is committed with the R20 million in the Reserve Bank, however, Parliament is excluded from clamping down on those people. What is the difference? Why is one department being discriminated against, while the Reserve Bank gets away with it?

The hon member is somewhat confused. The Reserve Bank has its own financial function which it fulfils. What we are dealing with here is that the controlling function of the Registrar of Financial Institutions is being transferred to the Reserve Bank. The hon member himself knows that there are certain insurance companies and banks that have also experienced problems. We did not go into those peoples’ financial statements. There are still two auditing firms which examine the Reserve Bank’s statements.

I now come to the hon member for Gezina. I want to say to him that I agree with him about the investigation into short-term insurance.

Question agreed to (Conservative Party and Herstigte Nasionale Party dissenting).

Bill read a second time.

Mr Chairman, I move:

Agreed to.