I move—

The object of the Bill I am introducing is to eliminate the numerous problems which arise in the field of third-party insurance. As you know, the Motor Vehicle Insurance Amendment Act, 1964 (Act No. 60 of 1964) was passed by Parliament in 1964 after the entire matter had been investigated by a Select Committee. When the Amendment Act was applied in practice—and as a result of certain problems which cropped up—it became evident that further amendments were required in order to place third-party insurance—which must be regarded as a social matter—on a sound basis and in that way to prevent the public from being caused any unnecessary inconvenience and to protect it against exploitation. Hon. members have had the privilege of a White Paper and, for that reason, I shall not deal with the provisions of the Bill in detail.

For the present, Section 1 (3) of Act No. 29 of 1942 provides that “a person who has placed or left a motor vehicle at any spot shall be deemed to be driving that motor vehicle while it moves from that spot as a result of gravity, or while it is stationary at that spot, or at a spot to which it moves from the first-mentioned spot as a result of gravity”. The onus of proof that such vehicle was placed or left at any spot by the registered owner of the vehicle or by someone authorized by him, rests on the State, and the object of the proposed amendment is to place the onus of proof on the registered owner.

In terms of the present provisions of Section 2 (3) the name of any registered company which has become incompetent to undertake motor vehicle insurance under the provisions of Act 29 of 1942 has to be removed from the list of registered companies.

Such removal of the name of the company results in all motor vehicles insured at such registered company becoming uninsured as from the day following the notice concerned, and in motorists insured at such registered company having to take out fresh insurance. Hon. members know about the inconvenience the public was caused when the name of Parity was removed from the list of registered companies and approximately 400,000 motorists had to take out fresh insurance. A recurrence of this unhealthy state of affairs was prevented through the establishment of the Motor Vehicle Insurance Fund, as a non-profit company, and the fact that the said fund would in future accept general liability for the payment of claims for compensation in terms of the provisions of the Act. Hon. members will recall that I entered into an agreement with 11 registered companies, and that it was one of the conditions of the agreement that 75 per cent of all premiums collected by the 11 companies should be paid into the fund to be used for the payment of claims for compensation. Consequently, it will be necessary in future to remove the name of any incompetent company, but seeing that such company runs, no risk in respect of the payment of claims, vehicles need not become uninsured when such a company becomes incompetent. Clause 2 seeks to create this situation. The present Section 11 bis of the Act provides that “a claim for compensation under Section 11 shall contain the particulars set out in a form prescribed by regulation …” Part of the prescribed form is a medical report seeking to reflect the injuries of the claimant. The courts have decided, however, that as the medical report is not specifically mentioned in the Act, it need not be completed, and furthermore that the claim need not be submitted on a prescribed form, but should merely contain the prescribed particulars.

Clause 3 seeks to put it beyond doubt that a claim for compensation has to be submitted on a prescribed form and has to contain a medical report. Hon. members know the origin of this provision, namely that it became necessary to ensure that registered companies would obtain sufficient information for considering the settlement of a claim without having to go to court to obtain the necessary information. Unfortunately it was a general practice in the past for claimants to withhold information from companies, if such companies did not accept liability in advance.

Clause 4 corrects a printing error. Subsection (3) of Section 20 provides that no licence (red number-plates) may be issued to a motor dealer in respect of motor vehicles which he owns in connection with his business as a motor dealer, unless the dealer can produce a declaration of insurance in respect of the number-plates. Such licences or number-plates have to be renewed before 21 January of each year and, consequently, a special insurance year had to be proclaimed in respect of this particular group of vehicles, namely from 16 January in one year to 15 January the next year. This state of affairs makes it more difficult to draw up a tariff of premiums, as the insurance year in respect of all other vehicles is from 1 May to 30 April and as statistics are consequently compiled for that period. As the insurance year has been changed with effect from 16 January 1966, this provision has been made retrospective to 1 January 1966.

Clause 5 contemplates the removal of the restriction in respect of the issuing of licences by licence officers, and will have the effect that it will be possible to adapt the insurance year in respect of motor dealers’ vehicles to that of other vehicles.

Mr. Speaker, during the last session of Parliament I gave the House a detailed explanation of why it was necessary for me to enter into an agreement with a number of registered companies to make insurance freely available to the public. On 23 April I said, inter alia—

Furthermore, I indicated that I had instructed my Department to draw up an agreement in terms of Section 24 of the Act, and, if necessary, to amend the Act for the purpose of entering into such an agreement. The amendment to the Act to which I referred is contained in Clause 6 of this Bill and differs from existing legislation to the extent that provision is now being made to enter into an agreement with more than one registered company in the discretion of the State President, and without prior notice to any person. The clause concerned further provides for the suspension of sub-section (1) of Section 2, which means that no further application for undertaking insurance may be made while an agreement such as that contemplated is in operation. However, the amendment authorizes the State President to exclude companies which are parties to the agreement from the agreement, and to admit additional companies as parties to the agreement. Notice has to be given in the Government Gazette when such an agreement has been entered into.

At this stage I want to inform the House of the nature of the private agreement I entered into with the companies in April last year. The provisional agreement entered into with certain companies provides as follows—

1. (a) All premiums in South Africa and South West Africa shall be collected by their own organizations and agents.
2. (b) They shall deal with and settle all claims arising from insurance undertaken by them.
3. (c) They shall take care that no obstacles are placed in the way of the public in connection with obtaining insurance, and that there will be sufficient points of distribution where insurance may be obtained.

As a quid pro quo for the action of the companies and in order to ensure that the country would not again experience chaos similar to the conditions of April,. 1965, the Minister undertook to introduce legislation in Parliament confirming by way of amending legislation the promises made by him. These promises were—

In the meantime the companies concerned have taken the following steps. The effect of the scheme has been that the companies concerned have appointed approximately 8,000 agents at this stage, and if necessary, will appoint more. Numerous officers for supervising the collection of premiums have been appointed as well as others who will assist and supplement the existing staff in the handling of claims. Office premises have been enlarged considerably to create more office space, so that no problem will be experienced in handling the work in general.

The effect of the consortium scheme will be the following. The public will be able to obtain insurance in terms of the provisions of the Act quite freely without the necessity of having to furnish roadworthy certificates for vehicles. There will be sufficient tokens and points of distribution so that the public will not have to hunt about for insurance. The premiums collected will be closely supervised, which will ensure that the public will not be subject to losses from this source.

In terms of the provisional agreement, a fund, known as the M.V.I. Fund, was established by the companies and registered as a non-profit company in terms of the provisions of Section 21 of the Companies Act, 1926. The remaining 75 per cent of the premium income is paid into this Fund, and the Fund acts as 100 per cent re-insurer for the members of the consortium in respect of the payment of claims and relevant costs, which does not include any administration costs of companies or canvassing costs (commission). The total income of the M.V.I. Fund is invested and the earnings on the investments accrue to the Fund and are used to (i) cover the administration costs of the Fund and (ii) supplement the premium income. The agreement provides that the directors of the M.V.I. Fund will receive no directors’ fees and that all administration costs of the Fund should only be met from earnings on investments and that no premium income may be used for that purpose. Only travelling and subsistence allowances are paid to directors. As the M.V.I. Fund has accepted general liability for the payment of claims, the members of the M.V.I. Fund are exempted from that liability. This means that a situation such as the Parity affair can never again arise as the public can rest assured that claims will be paid at all times in terms of the provisions of the Act. Consequently the amending legislation also provides that even in the event of one of the members of the consortium becoming insolvent, the vehicles insured with such member will nevertheless remain insured and that no further insurance will be payable for the same insurance year. The remaining members of the consortium have undertaken to pay any debts of such an insolvent member in respect of outstanding premiums due to the M.V.I. Fund. Since the establishment of the consortium and the M.V.I. Fund in 1965….

May I put a question? Will the Minister still regard himself as being bound in terms of the agreement with the consortium, even if this legislation were passed?

Morally, yes, Since the establishment of the consortium and the M.V.I. Fund in 1965, the public has been saved R4.000,000 in premiums and the public will be saved a further R4,000,000 during the next insurance year beginning on 1 May 1966, as the existing premium will be maintained. I want to explain that there was, as hon. members know, an application for a 20 per cent increase in premiums last year, which I refused. If that 20 per cent increase had been granted, it would have cost the public R4,000,000 in premiums. That money has been saved and for the next year there will be no increase in premiums either, which means that a further R4,000,000 will be saved.

And after that?

I expect that there will be no increase for several years and the reason for that is simply that the premium funds are now invested on interest and that that interest is added to the Fund; in other words, there is an additional source of income within this M.V.I. Fund, which was not the case in the past. Apart from the savings in respect of direct premiums the income of the M.V.I. Fund already amounts to approximately R70.000 in respect of interest on investments which supplements the premiums. It is estimated that the interest earnings of the M.V.I. Fund will amount to several million rand within the next number of years, and it will be possible to use that amount as a stabilization fund for the premium structure.

Clause 7 mainly contains consequential amendments but provides that upon the publication of the agreement by notice in the Government Gazette, which is provided for in the preceding clause, any company which was a registered company before the conclusion of the agreement shall cease to be such a company if the name of the company concerned is not set out in the said notice. However, such company will remain liable for any insurance undertaken by him prior to the conclusion of the agreement. A provisional agreement has been drawn up and has been entered into with eleven registered companies. As soon as this Bill has been placed on the Statute Book, a new agreement will be entered into between the State President and the eleven companies concerned, and no further companies will be permitted to continue undertaking third-party insurance.

All sorts of wild rumours are being spread by some of the companies which are excluded from the agreement. It is alleged that the 11 companies with which the agreement has been concluded will not have sufficient agents, that they will not be able to handle the claims and that costs to the public will increase. I can give the House the assurance that everything is being done to ensure the success of the new set-up. It should be borne in mind that for the past year the public has been paying 20 per cent less for third-party insurance than would have been the case if insurers’ claims for an increase in tariffs had been acceded to. I can also tell the House now that there will be no increase in tariffs for the year 1966-7, but the public must not be lulled into a false sense of satisfaction by that, and every endeavour should constantly be made to avoid accidents, because, as I have so often said in the past, premiums must inevitably increase if the number of accidents cannot be reduced.

It is quite refreshing to think that in a Session of Parliament like this, on the very eve of an election, there is a measure before the House which we can discuss without an eye to the forthcoming election, that we can consider it in the interest of the people objectively, with a serious desire that justice should be done to the public of the country, to the motorists and to those members of the public who may be injured in accidents.

I have listened with great interest to the Minister. It was remarkable to me that he had to spend so much time on the circumstances surrounding this Bill. Obviously this Bill has a history, and one cannot understand or appreciate it unless one takes into consideration why it has become necessary. This Bill is being introduced to validate certain illegal action undertaken by the Minister last year, and the Minister unfortunately did not give us much information about it. I do not want to spend much time on that. We all know that the actions taken by the Minister last year have by agrement been considered to be illegal and are of no force and effect, and are subject to an interdict by the Court; and this Bill is to validate the Minister’s illegal action.

In considering the Bill, one must remember that until last year the relationship between the registered insurance companies—and there are about 60 of them—undertaking insurance under this Act, with the Department and the public was a happy one. This law was originally passed in 1942, and the premium for third-party risks was then R3. The premium was increased from time to time and by 1961 it had gone up to R17 for an ordinary private vehicle. A commission was appointed, the Du Plessis Commission, to investigate the last premium increase and they found that that premium was not exorbitant, that in all the circumstances it was a fair premium to charge the motorist. Then in 1964 there was an application for a further increase, supported by the majority of the members of the premiums committee, a committee of experts, which advised the Minister; but the Minister refused it. Sir, we must not labour under the mistaken impression that the dispute between the Minister and the companies concerned arises from the fact that the Minister refused this increase in the premium because that would be to distort the recent history of this country in the insurance world.

That is your distortion.

On a point of order, I understood an hon. member over there to say “that is your distortion”, and I ask that he be ordered to withdraw it.

Which member?

It does not matter which member it was but that is what I understood him to say.

Order!

Sir, I do not take exception to that at all; some people have different standards.

It was shown during the course of this investigation into the increase in premiums that the number of deaths on our roads per 1,000 vehicles had increased from 1.9 per thousand in 1946 to 3.5 in 1964, a shocking state of affairs. One must consider that at the same time the compensation granted by our courts in cases where the breadwinner’s income had been lost, was growing—the courts tended to be more generous in their awards. One must also consider that by 1964, 99 out of every 1,000 vehicles on our roads, were involved in an accident every year—a sobering thought that of every ten motorists driving on our roads to-day one will probably be involved in an accident in the course of the year. It is a dreadful thought, and that is the background against which this problem should be seen. And yet, Sir. this was not the cause of the trouble in which the Minister and the Department and the motoring public found themselves last year. The crisis arose because of the Parity debacle, caused by the fact that in December 1964 Parity Insurance Company, which insured almost half of the 1,500,000 vehicles on our roads, was prohibited from undertaking this type of business and hundreds of thousands of motorists had to re-insure. Many of them were poor risks. Parity was allowed by the hon. the Minister to charge a lower premium than the other companies.

I had no say over that.

The matter was investigated by commissions; recommendations were made and it was decided by those in authority that Parity would still be allowed to charge a lower premium. Nothing was done to change that until the last moment. The Minister eventually used his influence to make Parity charge the same premiums. Those are facts. The simple fact is that Parity attracted the less trustworthy risks. Many of the people who insured with Parity were fine citizens and careful motorists, but a larger proportion of the bad risks went in for the cheaper insurance. In December 1964 these hundreds of thousands of insurers suddenly had to find new insurance. I think even to-day the State should pay tribute to the insurance companies of South Africa for the manner in which they assisted the State, the public of South Africa, to overcome that crisis. They decided among themselves that they would keep insured people formerly insured by Parity insured, and if a man had an accident …

Order! I do not want the hon. member to drift too far away from the Bill.

Sir, I am dealing with the fact that 44 insurance companies have been excluded from this type of business; the point I am trying to make is that they do not deserve such treatment because they have shown a great sense of responsibility in cooperating with the State in order to make this type of business possible. I am trying to make out that an injustice has been committed. If these people had been guilty of sabotage, of frustrating the work of the State in maintaining third-party insurance, one would have an argument, but I am showing what their attitude was. They stepped in when this company went practically bankrupt and took over the risks, to save the State that responsibility. Sir, it was so remarkable that in December 1964 the hon. the Minister himself paid tribute to them, and in a statement issued in glowing terms he said that the concession they had made to Parity customers had been done

the responsibility of the companies concerned in a time of national crisis as far as motor vehicle insurance was concerned. This is the gratitude they get! There were many other examples of the responsible attitude which these companies now excluded from this business have always shown. The Minister to-day spoke of the fact that if a company goes insolvent the insured people would still be covered. But these companies, apart from Parity, had voluntarily undertaken that if an insurance company went insolvent, they, the rest of them, would accept liability towards third parties for any claims that arose under the Motor Vehicle Insurance Act against that company. To show the attitude of these companies they had also undertaken in 1951 already to compensate victims or dependants of victims injured in crashes by hit-and-run motorists, or by motorists who, illegally, were not insured. They undertook to cover the public in cases of that kind; and since that undertaking they dealt with no fewer than 2,380 cases and paid out R3,190,000, against which they had no premium income, in order to protect the public—and this is the gratitude they get to-day. Then, when premiums had to be renewed in May of last year there was a problem; these bad risks were coming back and some companies—and let me say at once that any company which was guilty of this practice deserves no sympathy— tried to avoid their responsibilities. They put all sorts of obstacles in the way of people who wanted to take out third-party insurance because they wanted to avoid insuring many of the former Parity clients who came back to them under the agreement of December 1964; they wanted to avoid those bad risks. They used all sorts of devices; they hid their offices away on the fifth floor of buildings; they closed their offices during peak hours. One company, which is a member of the consortium to-day, required every client to fill in a long form detailing all other insurance which he had with that company. All sorts of obstacles were placed in the way of the public, and the Minister had to act. He then announced in Parliament that he would enter into an agreement with a consortium. But obviously when the Minister made the announcement he had not studied the agreement because he gave us certain information which was not supported by subsequent events. For example, he indicated that the reason why he would not lightly allow further companies to come in was that the original companies would have to bear the losses, but now we know that these companies are not bearing any loss. Yet the Minister is recorded in Hansard as having referred again and again to the fact that these eleven companies would suffer the losses. If the Minister wants the Hansard references I can assist him immediately. At col. 4706 on 23 April, for example, he said—

Nothing could be clearer—

That is totally different from what you said.

How can it be different? The Minister says that he cannot, when the business becomes profitable, allow new companies to come in when other companies have borne all the risks, but now we know that they will not bear any risk whatsoever. Then at column 4704 the hon. the Minister said—

There are others I could quote but I do not want to take up the time of the House. The fact remains that we did not understand that to be the position; we did not understand that the agreement would be in the terms that we heard to-day, when the Minister made that announcement in April last year.

Sir, we have certain objections to this Bill and to the scheme which it tries to legalize. Our objections are threefold. We say that the scheme is essentially unjust; secondly, we say that the scheme is not in the interests of South Africa and, thirdly, we say that it is not in the interests of the public. Let us see why we feel that this scheme is unjust. We feel it is unjust because, contrary to Government policy, it creates a monopoly. This Parliament has passed a law enabling the Government to take drastic action to break monopolies in the field of private enterprise, and now we find the hon. the Minister coming with a Bill to create the very evil against which Parliament has legislated in the private sphere; it creates a monopoly. And apart from that it is a type of boycott. Only the other day we had a statement from the hon. the Prime Minister that he would have nothing to do with boycotts, but here 44 insurance companies, including 14 South African companies, are being boycotted in part of their business, perhaps not very profitable business, but in circumstances which make it impossible for the vast majority of South African insurance companies to offer a comprehensive service to their clients, which must mean that this whole system will operate to the disadvantage of the companies now boycotted. Sir, how is this monopoly created? The greatest mystery about the agreement read out by the Minister is this: How did the Minister’s Department—because the Minister told us last year that he did not even know who the companies were—choose the 11 companies? I do not want to be invidious and make remarks about individual companies, but the selection of these 11 companies is an absolute mystery, unless one is suspicious and, as you know, Sir, I am not suspicious. One and a half million motor vehicles have to be insured in South Africa every year. One of the companies included in this consortium had insured 129 of the 1.500,000 vehicles the year before. On what grounds is that company included? The Minister surely owes an explanation to the people of South Africa as to why and on what basis these 11 companies were chosen above the others.

They have had a lot of experience!

The Minister will not be able to persuade anybody who knows anything about this subject that the other 44, or whatever the number may be, who have been excluded were all guilty of the malpractices to which he and 1 had both referred in these debates before. How were they selected? How can you take a little company, with 129 vehicles insured, include it in a monopoly; and then exclude companies which insured more than 4 per cent and 5 per cent of the total number of vehicles insured in South Africa—tens of thousands of vehicles—and which had played the game by the Minister and by the State and by the motorists in these matters? Sir, I say that this is not in the interests of South Africa. We South Africans have a very high reputation for our integrity in all financial matters. It becomes a great shock when you find that publications with great influence in the world have to write as the London Financial Times had to write in November 1965. This British paper, with great influence in the City of London, had to describe the scheme introduced by the Minister, of all the schemes in the world, as being the very worst. It was described as the very worst which could be found in the world by this influential London Financial Times. That is the analysis of the Minister’s scheme throughout the world, and it must harm the good reputation of the South African State for its integrity in dealing with the financial institutions, from all parts of the world, which invest their money and undertake their business in South Africa. Sir, I want to say this: The hon. the Minister of Finance or the Department of Finance should take a look at this plan because it must harm the reputation of our State for financial integrity, and the Department of Finance cannot tolerate that. I am convinced—they cannot deny it because there is joint Cabinet responsibility in South Africa—that a responsible Department of Finance, as differentiated from the Department of Transport, would never have undertaken such a scheme, denying the right to practise the business for which they have been established to insurance companies some of which have a hundred years of experience, free of all criticism. Now suddenly, for reasons that we cannot truly determine, these companies are denied the right to conduct the business for which they have been established in South Africa.

It is very difficult to think of a precedent in the legislation of a civilized country where a minority of businesses or enterprises in a certain field of enterprise is given the right, a veto, to exclude other people from entering that business, because that is what this Bill does. This consortium can exclude other people from entering the business—and I will not be surprised if it has to be a unanimous decision or something like that; the Minister should tell us. I asked the Minister whether he was still bound by the terms of this agreement, and he said, “morally, yes”. In other words, the Minister in advance is morally bound to frustrate the discretion which this Bill gives to the State President to allow other people into the consortium. The Minister is morally bound by the agreement, which gives the consortium a discretion as to whom they will admit. Is he going to advise the State President, against the agreement he has entered into with the consortium, to admit other companies, to use his discretion? Because the State President, as we know, is a constitutional head of State and acts on the advice of the Cabinet. You see, Sir, what sort of troubles we have with this Bill.

Finally I say that this Bill is not in the interests of the public of South Africa. It is not necessary to take my word for it or the word of the Opposition. We had an investigation recently into the Parity debacle, to which I referred before; and the learned chairman of the commission, an impartial Judge of our Supreme Court, found it necessary to look at this consortium plan. It was not in his terms of reference, but he felt that his entire report would be useless and that the value of it would be lessened considerably unless he dealt with this most important development in the insurance life of South Africa, the establishment of this monopolistic consortium. Sir, I would like to refer you to paragraph 256 of this report, where this judicial commission, referring to the scheme, says—

This comes from a Judge of the Court—

Of course it is diminished. The Minister tried to deal with some of the problems in advance, but last year the Minister very eloquently, and with the full agreement of most of us on this side of the House, said he could not convert third-party insurance into a State enterprise because of the manpower shortage, and he pointed out that third-party insurance required the co-operation of a vast army of insurance agents and experts. Does he really think, if he excludes from the operation of this scheme 40 or 50 companies, who in the past did 55 per cent, I think, of the total insurance done under the Motor Vehicle Insurance Act, that the other 11 companies can in time find the manpower to deal with all these applications and then service the motorist as he is entitled to be serviced and give due attention to the claims? I fear that this manpower position can only be met by the 11 companies if they start doing what the Minister has condemned, as far as his own railways are concerned, and that is to start buying away staff from others. Already they advertise in the Press, and were stopped by the courts, calling upon the agents of other companies to apply to them for agencies. Sir, can you see the chaos, the injustice, the unfair practices that this Bill encourages? The commission went further. Let me read to the hon. the Minister what it said in paragraph 257 of its report. Having already referred to the disturbing feature which I have just mentioned, the commission goes on to say—

A Select Committee of this House has recommended in the past that some such pool should be considered. But I say that it is a dangerous thing the Minister is doing—to allow 11 companies to undertake this insurance and to settle the claims without carrying some of the responsibility. Sir, they are not gods or demigods; they are human beings, and when you take into consideration that the cost of settling a claim will be paid for by the Vehicle Insurance Fund, that the cost of disputing a claim will be borne by the companies, what will the tendency be? The tendency will be to settle claims and to avoid costs resulting from long arguments and legal disputes and the employment of attorneys. The tendency will be to settle the claim and be done with it and to let the fund pay; the tendency will be to say: “Let us save as much as we can of our 25 per cent.” That is inevitable. I am convinced that, in order to settle claims speedily, there will be a tendency on the part of the companies to settle these claims according to a prescribed formula. In fact they have advertised that. In the advertisement which the court has stopped the companies said that claims would be settled according to prescribed rates. What does that mean? It means something similar to what we have in workmen’s compensation: that, if a man loses his right hand, he will be paid so much. A Member of Parliament, who does not need his right hand except to shake the hands of his voters, will get the same compensation as a skilled surgeon or an outstanding international artist. Where will the justice be? This is the sort of risk to which the public is exposed. This is the sort of agreement into which the Minister allowed himself to be rushed at the end of last year. Then, there is also the danger that the companies may tend to neglect the interests of the public. Sir, insurance is an intimate relationship. It is described in our law as a relationship of the highest good faith. Here we find that the companies are going to be called upon to give a service to the clients of other com panies who give them comprehensive services including their comprehensive motor insurance and fire insurance, accident insurance and public liability insurance. They have a relationship, which over the years becomes an intimate relationship between them and their company; now a new company enters and has to give them this cover. Why should they give them the same attention, unless they can pinch their business? Why should they give the same attention as the company which has perhaps established a life-long association with its customer? The public will suffer because people will now no longer be able to choose the company which they trust and with which they have a relationship of the highest good faith. They are limited to companies prescribed to them by the hon. the Minister.

The hon. the Minister has told us about the money that the motorist has been saved; I am very pleased to hear that, but for how long? There is strong evidence that this was not the most profitable form of insurance that there was, but the experience of this Vehicle Insurance Fund will only be known after three years, because the claims are not assessable under the law for at least two years in many cases. What happens at the end of three years if, in spite of the Minister’s optimism—he has now discarded all the experience and knowledge of the majority of the companies that used to do this business, and he is going into a new unchartered field—what happens if, at the end of three years, he finds that they have been running at a considerable loss? According to the agreement to which he is morally bound the motorist will be asked to make up the loss by paying an increased premium and, if that does not happen, then the taxpayer will have to do it; but another three years will go past in the dark, so to speak, for the lack of a further investigation into this matter. It is very interesting, Sir, that the judicial commission of inquiry into the Parity debacle in Chapter 17 of its report recommended very strongly that the hon. the Minister and the Government should not agree hastily to this plan, but should refer it to a commission of experts to investigate the points I have raised here to-day and others. I want to say that we on this side of the House feel strongly that the best interests of the public of South Africa —and that is our major concern, the motoring public and the people who may be the victims of accidents—would best be served if this matter is further investigated, and therefore I am going to move in a minute that the subject matter of this Bill be discharged and referred to a Select Committee before the second reading so that the experts can come and give evidence before such a committee, so that we can put questions to the Department and find out, for example, why some of these 11 companies were selected. The public is entitled to know; let us find that out and let us go into all the problems and difficulties and into the harmful tendencies of the Minister’s measure as far as the public is concerned. The Minister may say: “Yes, but what happens on 1 May when premiums have to be renewed?” There is no reason why the Minister cannot revert to the existing situation and let all companies who are registered under the Act do the insurance. If he feels that a pool or a fund like this is necessary, we can help him to establish it in due course, but I do feel that whatever is done as an interim measure, the principle that the insurers should carry at least part of the risk, that they should be at least partly responsible for the consequences of the settlements that they may make with the public, should be retained. It is in that spirit, in the spirit of seeking to achieve for the motoring public of South Africa and for the general public of South Africa the best legislation in the field of third-party insurance that I wish to move as an amendment—

It is now very clear that the Opposition finds itself in an extremely difficult position, because to-day, on the eve of the election, the Government comes forward with a first-rate piece of legislation, and the Opposition has no option but to make an attempt at having the matter shelved by moving that the Bill be referred to a Select Committee. I wonder whether the hon. member for Yeoville (Mr. S. J. M. Steyn) realises how many Select Committees and commissions have already deliberated on this matter. He knows that two commissions have already sat in this case. We have had the du Plessis Commission; we have had departmental committees; we have had the Marais Commission and its report is very clear. This report by the Marais Commission has not yet been considered and accepted by the Government as it stands. It has been published. As far as the report of the Marais Commission is concerned, the Government is being encouraged to refer the matter to experts for further investigation.

I should like to reply to a few points raised by the hon. member for Yeoville. He raised quite a number of arguments, arguments which did not at all amount to much. The hon. member said that because these eleven companies were now going to be amalgamated in order to do this third-party insurance work, all the other companies would be excluded from selling comprehensive insurance in the future. Where does the hon. member get that from? Surely that is not so; the other companies will be able to continue selling that kind of insurance. They can do it and they will do it, what is more. They will in fact have to eliminate third-party insurance, but they will be able to undertake other insurance. The hon. member must not make such incorrect statements here.

This Bill does not prevent the other companies from selling comprehensive insurance.

At their own risk, yes.

Up to this stage they have been selling comprehensive insurance at their own risk. It is not covered by third-party legislation. Those other companies are quite entitled to sell other kinds of insurance, and they will continue to do so. Why would the other companies no longer continue to sell comprehensive insurance? Where does the hon. member get the idea that these eleven companies will have the monopoly of selling all kinds of insurance in South Africa? There is no such provision in this Bill.

You yourself asked for it last year.

No. I did not. When did I ask for anything like that? Mr. Speaker, it is very clear that this argument of the hon. member does not carry any weight. The other companies will undoubtedly be able to continue to undertake other types of insurance, and in no way will they be prejudiced by this legislation. Would it not be to their advantage if third-party insurance, which has already had such disastrous results in South Africa, were taken away from them? The hon. member came along saying that originally in 1942 the premiums were R3. and that it was subsequently increased to R17. a figure which is still insufficient. Hon. members on the opposite side are advocating an increase in the premium. Fortunately the hon. Minister of Transport opposed that motion and said that the premiums would not be increased. Last year the country was saved the amount of R4,000,000 because the 20 per cent increase which was requested, was not granted.

When did we ask that?

Hon. members on the other side are asking for increases all the time. In the course of this debate an increase was in fact requested. I think that this amount of R17 was granted in 1964, and at that stage the Parity Company did in fact charge R3 less than the other companies, namely R14. If the other companies had at that stage requested a premium of R14 instead of R17, it would not have been possible to criticise the Government to-day for allegedly neglecting to increase the premium charged by this company to R17.

But I never said such a thing.

Precisely. The hon. member did not say that, neither could he have said it. Therefore my statement is correct. Everybody would then have been satisfied with R14. And if all the companies had felt that R14 was too low, they would have requested the Government to increase it to R17, and then this Government would, according to the hon. member, have acted perfectly correctly….

In this debate you are speaking against your own conscience and not against us.

Well, I still have a conscience, but I do not know whether that hon. member has one. The hon. member raised another point, namely that these eleven companies could not serve the interests of South Africa properly—that was the hon. member’s insinuation. If the Government had established a state corporation instead of this consortium of eleven companies, would the hon. member then also allege that the interests of South Africa were not being served? Are the interests of the country only served if another 40 companies qualified for the handling of this type of insurance? The Bill under discussion makes it very clear that other companies can also be admitted as parties to that agreement. Apparently the hon. member has not read it, and I shall now read out to him the last paragraph of Clause 6—

Mr. Speaker, I am convinced that if we are going to place a good piece of legislation on our Statute Book this year, then it will be this legislation. We all know what happened to this sort of legislation in the past. We all know about the Parity case. Mon. members probably know that a police investigation is in progress at the moment. Hon. members are also aware of other cases which are receiving attention. I do not want to talk about that now. It is likely that not all members on the opposite side know what is happening.

But last year you said that nothing was the matter with Parity.

Who said that? It is only that hon. member who would say such things. I do not know where he obtained his information.

You are the one who said it.

These eleven companies will undertake this particular kind of insurance. Together they form a consortium and should one of them go bankrupt, the other companies will accept responsibility for that company.

That has always been the position in the past.

75 per cent of the premiums have now very decidedly—I repeat, very decidedly—been included in that consortium’s pool. Not one of the companies will be able to use or abuse it as has been the case in the past. What is more, that 75 per cent, a fund which can be supplemented by means of interest and other revenues, is now under much better control than any company has been in the past. The firms of auditors which are examining the books of the existing companies, will also examine the books of these eleven companies. It is quite probable that there can be eleven different firms of auditors. There can even be more if a company has two joint auditors. The statements of the eleven companies will therefore still be examined by their own auditors. And they will indeed look after the interests of the public of South Africa. In addition to that, the firm of auditors to the consortium— which will have its separate and independent firm of auditors—also has the right to examine the books of any of the eleven companies. That has already been done. They have the full consent of the companies and of their auditors on a professional basis, and they have already examined the books of some of those companies. They have checked the information they wanted. The claims committee appointed in terms of existing legislation, has the right to investigate the affairs of the company. They can determine whether the affairs of the companies and those of the consortium are sound. That is a third method of control. We also have the inspectors of the Department of Transport. They form a fourth controlling body. In addition to that we have the Registrar of Financial Institutions and his inspectorate. Legislation also enables them to keep affairs of this nature in a sound state.

I want to conclude, Sir, by asking the Opposition, which is keeping such a watchful eye on the Government, that they should also watch carefully in this regard to see whether all goes well with the consortium. I hope that as far as this is concerned they will also contribute their share and do their duty.

On behalf of this side of the House I should like to thank the hon. Minister for coming forward at this stage with a measure aimed at putting third-party insurance on a good and sound basis once and for all. A thing like this is in the interests of South Africa, of our motor-car owners, and also of the public in general.

I should like to refer to something which I advocated in the past, something to which that hon. member objected, and that is that one cannot claim an unlimited amount under a third-party policy. The hon. member said that a member of Parliament could now claim just as much as an ordinary worker.

I did not say that. I never said that. I did not draw such a comparison between a member of Parliament and a worker.

In that case I withdraw my words.

I compared the position of a member of Parliament with that of an artist or a surgeon.

If you did not put it that way, I retract my words. I accept your word. Under third-party insurance one finds a certain oddness, and if the hon. member is in favour of its being amended, he has my full support. I have advocated such an amendment in the past, and to-day I advocate it again. Mr. Speaker, as you know, when an insured person takes out his third-party insurance, he only pays R17 for it. Recently we had a case on the East Rand where an amount of R120,000 was paid out after a medical practitioner had lost his life in an accident. If this should happen to another person, someone whose income is not as high, a very small amount is paid out. It is simply not fair that two persons pay the same premium, but when a claim is paid out, the amount in one case is very high while it only amounts to R5,000 or R6,000 in the other case. That is not fair. If a person’s income is so high …

Order! Order! The hon. member is now touching on a matter which is not under discussion.

Then, Mr. Speaker, I shall content myself then with what I have said. I repeat: This is sound legislation, and I hope the hon. Minister will not accept the hon. member’s amendment.

I think it is very significant that ever since this debate started—when the hon. the Minister outlined a new basis for third party insurance—not a single Government party member of the Select Committees of 1963 and 1964, which investigated third party insurance, has been in this House, I think it is a shocking state of affairs that Government members of that Committee must feel so frustrated at having their unanimous report not accepted by the Minister that they do not see fit to be in the House to listen to the new basis of insurance now recommended by the hon. the Minister. And I know the reason for their frustration. The reason is that every single member of that Committee was dissatisfied with the Minister’s refusal to accept the unanimous report of the first Select Committee.

I should like to remind this House of what I told the hon. the Minister on 23 April last year. I quote from Hansard, Col. 4689—

that is the Bill now before us—

Now, I want to remind the House of what I then told the hon. the Minister, and which he has never denied, namely (Hansard, Col. 4689)—

That is what I said last year, and that is what I now repeat. And that explains why not a single member from that side of the House who sat on those two Select Committees is in this House to defend the Minister! All the members from this side who served on that committee are here. We are taking an interest in this matter, and are trying to bring about a state of affairs which is more in the interest, and to the benefit, of the motorist in South Africa. Our attitude is in contrast to the discourtesy shown to the country and the public by former members of those Select Committees who are not here to back up their own Minister! They are not with the Minister, and their heart and soul are not in this unusual type of legislation. That is too obvious from the form and the nature of the committee’s recommendations.

But what is even more surprising is that the Government sees fit to put up the hon. member for Pretoria (Sunnyside) (Mr. van Zyl) as their main speaker. Because, Sir, I will now quote from Hansard (Col. 4685) what the hon. member said on 23 April 1965. I want to know from the hon. Minister of Transport whether he agrees with the views expressed by the hon. member. This is what the hon. member said—

that is the hon. the Minister—

referring to third-party insurance—

Is it not a shocking state of affairs that a member of that side of the House, one who is now put up as the main speaker, that he should suggest to the hon. the Minister that he must go still even further than he has gone in terms of this Bill, and exclude 59 companies from doing third-party insurance, in other words, create a legal monopoly? The hon. member even went further, because he suggested that they be excluded from doing all types of insurance work in South Africa! I should like to ask the Minister whether he agrees with those sentiments.

You are now pleading for Rhodesia. What is happening in Rhodesia now? You are always pleading Rhodesia’s cause.

Because if the Minister does agree then I want to reinforce the arguments used by the hon. member for Yeoville when he drew attention to certain unsatisfactory comment by an overseas publication regarding the new Third-party Insurance basis evolved by the hon. the Minister. Just as important and influential as the Financial Mail of London is. I think the London Economist, a financial paper, is equally as important, and notice should be taken of what it says. This is what that paper says on the question of attracting foreign capital to South Africa. Before quoting from that paper, I want to remind the hon. the Minister that his colleague, the hon. the Minister of Finance, only a few days ago at a meeting held in Cape Town appealed to the insurance companies of South Africa to invest larger amounts in Government loans and Government stocks. If he did that, is this criticism of overseas companies justified? Because, Sir. this is what the London Economistsaid on 24 July 1965—

That is the warning I want to give to the hon. the Minister. I want to warn him against building up this legal monopoly, and in doing so excluding a large number of companies who have “played he game”. Those are the words of the hon. the Minister. I should like the Minister to tell me, when he replies, which of the excluded companies have not played the game? Because he said if they played the game, they will get consideration and be properly treated. But certain of these companies who have in fact played the game, can prove that they have now been discriminated against and no concern has been shown in their position.

The hon. the Minister in reply to a question put by me on Friday, said that one of his objections against the excluded companies, was the fact that they demanded roadworthy certificates indiscriminately. He also said that an artificial shortage of tokens was created. If the roadworthy certificate aspect was an important factor contributing to the discrimination against the companies affected, then that aspect should surely apply to all companies, including those now taken up in the consortium. Does the hon. the Minister deny that members of the consortium adopted similar obstructive tactics? Does the Minister deny that some of these companies did not place obstacles in the way of motorists seeking third-party discs? Because, Sir, if the Minister does, I should like to refer him to a report which appeared in the Star on 23 April 1965 headed “Roadworthy checks on Cars”. I am afraid I have to mention the names of the companies referred to here else the report will have no potency. The hon. the Minister will have to bear with me in this regard—

This was said by a “spokesman” for the organization. This organization is a member of the consortium. The spokesman admitted that they were acting illegally in terms of the Motor Vehicle Insurance Act, in that they were making it difficult for motorists to obtain insurance freely.

Why, then, do we have this discrimination against certain other excluded companies? If companies—including those in the consortium —have acted in the way referred to, then the Minister should be fair and let all registered companies undertake this type of insurance.

The hon. member for Yeoville referred to another form of impediment placed in the way of motorists seeking third-party insurance. I want to ask the hon. the Minister whether he saw this questionnaire which was used exclusively by one of the members of the consortium—S.A.N.T.A.M.—and relating to third-party insurance. This is what the heading says—

The V.D.P.-versekering refers to motor vehicle insurance. Well, this company did not issue a single third-party insurance policy unless this form which I am handing in, was completed. Can the hon. the Minister tell me whether any of the excluded companies did anything of a similar nature?

Mr. Speaker, it is difficult to understand on what basis the hon. the Minister has selected the 11 companies. When I asked him on Friday on what basis these companies were appointed, he replied that it would be difficult to deal with this aspect in the form of question and answer, and that it would be better to deal with it during the debate on this Bill. Well, I waited anxiously to hear from the Minister what was the basis. Because, surely when the hon. the Minister replies to me as he did, then I am entitled to expect that he will go into details when introducing the Bill regarding the basis of appointment to the consortium. But, Sir, the hon. the Minister has not said a single word as to how these companies were appointed! When we questioned the Minister—and this is important as far as the interests of the motorist are concerned—as to the possibility of an increase in premiums, he replied that he had turned down proposals for increases in premium this year. But what the public must keep in mind is that it will only be in three years’ time, at the earliest, before the Minister will be in a position to decide whether an increase is justified. Because in terms of the Act a claimant has two years in which to advise of his claim and lodge it. Only after that period will we know what the statistics for third-party insurance claims are. When that time arrives, there will be, in my opinion, a tremendous increase in third-party insurance premiums. In support of this contention I should like to quote from the report of the Annual General Meeting of the S.A.N.T.A.M. insurance group held on 26 January 1965. This is what the Chairman, Dr. C. R. Louw, had to say—

That was said on 26 January 1965. Yet on 23 April of the same year the hon. the Minister establishes a consortium, of which S.A.N.T.A.M. is a member, when he knows what the views and opinions of the Chairman of that Company are!

These, Sir, are the worries, the doubts, the fears the man in the street has. And although I concede that the hon. the Minister found himself in a very difficult position in April of last year when he was confronted with an unhealthy state of affairs as far as third-party insurance was concerned, and he acted hastily and angrily, nevertheless that does not justify the complete and indiscriminate exclusion of certain companies and the break-down of the insurance business of this country. I appeal to the hon. the Minister to reconsider this matter and to refer it to a Select Committee where recent developments and manifestations can once again be investigated and thrashed out satisfactorily.

The hon. the Minister has expressed the view that the public will not be inconvenienced on 1 May when third-party insurance becomes necessary. I hope he is right. But the Minister has so often in the past Peen wrong in his conclusions regarding third-party insurance, that I venture to suggest that we are going to have chaos and a lot of bungling again on the 1st of May.

Mr. Speaker, when one looks at the portfolio of this consortium, one finds that five of the 11 companies were only handling 4.11 per cent of all the third-party insurance business for the last year. Half of the consortium companies were only handling 4 per cent of all the Republic’s business! And the hon. the Minister knows that these five companies do not have an agency network or a branch office establishment throughout the country to satisfactorily cater for the needs of motorists and the general public. Third-party insurance does not involve only the issue of a token. Claim forms have to be filled in. Claims sometimes take years to be settled. Various and complicated aspects of third-party insurance have to be handled by insurance companies and their agents. And these five companies are just not sufficiently organized throughout the country on the lines mentioned by me to meet the requirements of the public.

The hon. the Minister can still save the situation—and I use these words advisedly—as far as the motoring and general public are concerned, by allowing a number of companies at presently excluded from the Minister’s scheme to form an additional consortium as one South African group. By making their agency organization and branch structure available to the public, they will be assisting the existing consortium of 11.

I do not believe when this House again debates third party insurance—and that will be three years from now—that there will still be 11 companies in this consortium. I am satisfied that the number will be whittled down to possibly two or three. In the result there will be an absolute monopoly established in the field of third party insurance in South Africa. And I wonder, Sir, whether that is not the deliberate aim of the Minister and his Department! Because when the du Plessis Commission was appointed, one of its terms of reference was to consider whether all third-party insurance should not be handled by “an” insurance company. I should hate to see such a situation develop. But it can develop, Sir, because of the fact that a large number of these 11 companies just have not had the necessary experience, based on their portfolio in third-party insurance business, to handle this business efficiently and sufficiently broadly.

The hon. member for Yeoville pertinently asked the Minister what the basis was for the appointment of these other insurance companies. The Minister, however, did not give us an answer, nor did he give us the answer last year. But suddenly after having appointed only six companies initially, the Minister came forward with another five companies. Are these five companies all truly South African companies? Three of these companies were only established as South African companies approximately one year before the Minister made his announcement. I do not want to suggest it, but it has been said and reported in the national and financial Press that the decision to include these other five companies was done merely to give a veneer of respectability to this arrangement by the hon. the Minister. When this was said last year, the hon. the Minister was then also warned that this was an illegal arrangement. Despite that, however, the Minister refused to accept the advice from this side of the House that he should hasten slowly, and that he should first reconsider the matter very carefully, as in our view, it was illegal. Events have proved it to be illegal, and it is possible that we have not yet heard the last about this particular aspect.

The Minister has said that he is morally committed in this matter. We respect his point of view in this matter, but if he is morally committed and it is shown that the agreement is illegal, does that not offer the Minister the opportunity to reconsider the whole matter de novo?

And if the agreement itself is immoral?

What worries us particularly is the letter dated 28 October 1965 addressed by the Minister to the attorneys of the Motor Vehicle Insurance Act Committee, in which the following is said—

As I said, Mr. Speaker, that may be a moral stand which the hon. the Minister feels himself justified in taking, but where one is dealing with such an important issue involving as it does the whole structure of a business industry in South Africa, I think the hon. the Minister should not remain so obstinate as not to give further consideration to this matter. We, on this side of the House, have suggested to him an opening in this regard, and I think he will be well advised to consider and accept the amendment which has been put forward in this regard by the hon. member for Yeoville. Does the hon. Minister deem it to be correct that the whole industry must suffer for the misdeeds of a few? I should also like to draw the attention of the hon. the Minister to the fact that at least one company, a South African company, put forward an identical scheme to the one on which the Minister is now embarking, and suggested to the Minister that that might be the modus operandi for overcoming the difficulties with which we were confronted in this country as regards third party insurance. But, Mr. Speaker, the hon. the Minister has excluded this company as well! One just cannot understand the basis of the whole operation, especially if you keep in mind that there is at least one other South African company that has been excluded, a company which has been operating very successfully and efficiently since 1904 and has never given the Minister any cause for complaint!

The hon. member for Yeoville has shown that this is not insurance in the true sense of the word. The 11 insurance companies carry no risk at all. As the premiums go up, so the basis of their commission is increased because the higher the premiums, the higher is the 25 per cent allowance which the Minister is allowing to these companies. They will be living in clover! What assurance can the hon. the Minister give this House that this consortium will see to it that its claims are settled at the lowest possible figure? Human nature being what it is, you cannot expect them to give up too much of their time for consideration of details of administration in seeing that claims are paid out on the lowest possible basis, because they are guaranteed to be refunded whatever their losses may be. But there is yet another pertinent question I should like to put to the hon. the Minister. When he dealt with the terms of the agreement entered into with this consortium, he did not tell this House what would happen if there is a short-fall in the fund. Who is going to make up such a short-fall?

The motorists.

Will it be the motorists who shall have to make up such a short-fall? As a matter of fact, I cannot see any other alternative under the Minister’s scheme. However, I should like the hon. the Minister to tell us exactly how he intends refunding or replenishing the consortium’s pool. The hon. member for Yeoville has already said, and I say so too, that this is not insurance. I would even go so far as to say that the scheme evolved by the hon. the Minister could be undertaken just as effectively by the garages in South Africa, or by the lawyers in South Africa or even by the butchers of South Africa! To that extent is this insurance, and to that extent does it need any experienced business man to handle it?

We should also like to know from the hon. the Minister what precautions are being taken against insolvency. The Minister has referred to the fact that should a company go insolvent, all the other companies of that consortium would be responsible for the liabilities of the insolvent company. However, the thought which is worrying me is that the Minister is only calling on these companies to put up as a deposit, only R25,000 each—in other words, a total of R275,000 has to be deposited by the consortium as a whole. If it is going to take three years before arriving at some accurate calculation as to the claims records as against premium income, and there are losses from the first year onwards—something which we will be entitled to assume from the authoritative report by the Chairman of Santam—then the R275,000 will be eaten up in the first year or two. Therefore I think it is necessary that the hon. the Minister should tell this House whether he is prepared to report annually to this House on the history of the consortium, and on what is happening with their accrued revenue. The hon. the Minister should, furthermore, tell this House what is going to happen if there are any surplusses in their fund. Should he tell us that such surplusses will have to go into some consolidated revenue fund, then we will be very worried indeed because we remember the reserves which have been built up in the Unemployment Insurance Fund where there has been an accumulation of millions and millions of rand which has just been lying there without the public benefiting from this surplus at all. Unemployment insurance premiums have been going up and up, and that despite the accumulation of these reserves. Should there be a surplus in the fund of this consortium, we are afraid that a similar situation will arise in the third-party insurance field.

For all the reasons advanced by the hon. member for Yeoville, reasons why I have tried to supplement, I submit and feel sure that this Bill with its monopolistic tendencies is not in the interests of the public, and that time will prove this to have been a hastily conceived measure, an unjust measure and one that is going to cause a lot of disfavour and dissatisfaction in the outside world where South Africa’s financial reputation has up to now, been held in a very high esteem indeed.

I should like to preface my remarks here this morning by saying immediately that I appreciate the difficult position with which the Minister was confronted in the early part of 1965. The House will remember that the Minister knew, and the country knew, that there was an imminent collapse of two cut-rate M.V.A. insurers, namely Parity and Auto Protection, and that the interests of the public required something of an urgent nature to be done. In addition, the Minister was confronted with a public statement which had been made by the chairman of one of the largest insurance companies in the field of third party insurance. In this statement he said—

Speaking at the Annual Meeting of his Company, the gentleman concerned said that his Company had incurred a loss on this type of business in every one of the past four years. He proceeded by saying—

He emphasized that as a result of losses incurred in writing this business—

I want to reiterate, Mr. Speaker, and I am sure every reasonable member of this House as well as of the public appreciates the very difficult position with which the Minister was confronted early in 1965, namely the imminent collapse of these two cut-rate insurance companies and with the public statement from which I have just quoted. But having said this, I want to say to the Minister most objectively that this unfortunate predicament with which he was confronted no longer exists. So, whatever the Minister did in the interim in order to try and safeguard the interests of the public in the face of the position which obtained then, may have been justified. I feel however that after this House has had an opportunity of considering this Bill thoroughly the Minister will realize that he is no longer faced with the predicament with which he was faced in 1965. This is a short Session of Parliament, convened in order to deal with urgent public measures before a general election takes place. As far as I am concerned, Mr. Speaker, I have not heard from the Minister this morning a single word justifying the adoption of this Bill during this short Session as a matter of urgent public necessity. Let me then tell the hon. the Minister most emphatically that to my mind there exists no valid reason why this Bill should be dealt with now as a matter of urgency. Indeed, there exists no urgency at all to-day in so far as this matter is concerned. All recognized insurance companies in South Africa, many of them South African and many of them subsidiaries of overseas companies, have indicated their willingness to continue M.V.A. insurance until such time as the Minister has been able to give careful consideration to the method by which this type of insurance can continue. I submit that the interest of the public has already been safeguarded by the public declaration made by these recognized insurance companies to the effect that they are prepared to carry on with their M.V.A. insurance now that these two cut-rate insurance companies have disappeared from the third party field. Consequently I say that the urgency with which the Minister was confronted early in 1965 no longer exists and that there is no valid reason whatever why this House should be pressed into having to give consideration to this most contentious Bill especially in view of the fact that it has been called together in order to deal with matters only of urgent public importance before the general election. Let me therefore reiterate: The public interest having been protected by the statement made by all recognized and well-established companies there exists no urgency any longer in regard to this matter.

What is more, the Minister surely cannot afford to disregard the advice of the judicial commission, advice given two or three months ago when that commission, dealing with the collapse of Parity, went out of its way to warn the Minister and the Government to go cautiously in regard to M.V.A. insurance and not to proceed with this consortium scheme, which had become public by then, without the most careful prior investigations. So, in view of the fact that no urgency exists at the present moment, it will be wrong for the hon. the Minister completely to disregard this advice. I also emphasize that it will be wrong for this House to disregard that advice. The learned judge who led the inquiry had an opportunity of investigating in so far as it was possible, the reasons for the collapse of Parity. He also had an opportunity of investigating M.V.A. insurance in this country in all its amplitude. Having had all these opportunities, he came forward with a very strong recommendation that the Department of Transport should not proceed with this consortium scheme until the fullest possible investigation had been made. Therefore, I submit, that it is wrong for this House to be called upon to validate a scheme which the learned judge warns us should not be proceeded with without the most careful investigation.

But I want to go further. Surely the hon. the Minister cannot in present circumstances ignore the comments which were made in the most important financial paper in the world, comment which was also referred to by the hon. member for Yeoville this morning. I refer to the London Financial Times which echoes the sentiments of the entire business world when it says—

The word “solution” is given in inverted commas because, Sir it is definitely not a solution. The article continued—

I say, Sir, most advisedly, that the Minister cannot afford to ignore comments of this sort. We would be doing our country no advantage if we were to be asked to steamroller this Bill now through this House without the fullest possible investigation into all the implications of the scheme. I gather that the hon. the Minister acknowledges that in entering into this scheme under the difficult circumstances which prevailed in 1965, his Department acted contrary to the law as it then existed. As far as I know, the Minister has not up till now made public the actual terms of the agreement. It has not been laid upon the Table of the House and, as I said, the agreement itself had not yet been disclosed except for what one has been able to glean from public statements from some of the members of the consortium and by the hon. the Minister from time to time. However, it is an acknowledged fact now that that agreement has no validity in law. Why then should the hon. the Minister now ask this House to rush in to validate something which everybody acknowledges to be an illegal and invalid agreement? Why then validate it? There is no urgency for such validation. When all recognized and well-established insurance companies have indicated that they are prepared to continue their M.V.A. insurance, then surely it is wrong for the Minister to ask us in this short Session to validate an illegal agreement, an agreement which I submit can only bring about a great deal of unnecessary friction and which, furthermore, is not in the public interest.

I want to say that if ever there was a case which justified the most careful investigation by a select committee or by a team of experts, then this is such a case. And let me state here that there are no political implications in this matter. There are no political axes to be ground as far as this matter is concerned. We all are out only to do the best for our South African public in trying to secure for them the best and safest form of insurance at the lowest possible rate of premium. We all have a common interest in this matter. So that it does not matter to what party I belong. It is in the public interests of South Africa that we should evolve a system which will give to our South African citizens the maximum amount of cover in the field of third-party insurance at the lowest possible rate of premium. But, as I was saying, if ever there was a case which justified the fullest possible inquiry by a select committee or by a team of experts this is such a case. A select committee will have an opportunity of calling for evidence from interested parties from all over the country. There is no gainsaying the fact that there have been many disturbing features about this consortium agreement. I do not intend going into all these disturbing features—some of them have already been mentioned and dealt with by the hon. member for Yeoville and other speakers on this side of the House. So I have no desire to go into these disturbing features again but I want to assure the hon. the Minister that business people right throughout the country, whether interested or not in insurance, have indicated that this consortium agreement has left a bad taste in the mouth and a bad smell in the nostrils.

The hon. the Minister has not up to now indicated—and I do not want him to do so now because it can only lead to greater friction and excaserbate the feelings which already exist—the basis upon which the companies of this consortium have been chosen. I have had an opportunity of looking up what share members of this consortium have had up to now in the field of M.V.A. insurance. I do not propose mentioning any names. The figures however speak for themselves. I have found that one company of this consortium has had a share of third party insurance in the past of only .68 per cent; another company has had .66 per cent; and a third has had only .04 per cent of the total M.V.A. business in the country.

That cannot be possible.

Well, these figures come from the Minister’s own records. It is these companies that have been chosen as members of the consortium.

What is wrong with it?

What is right with it! That is what we should ask ourselves and not what is wrong with it. The hon. member must justify to this House the exclusion of 50 to 60 well-established companies possessing undoubted funds, who have carried their losses over the years and who have nevertheless played their part in giving to the public the best kind of insurance. It is these companies who have carried the burden over the years who are being excluded and companies such as the three I have referred to are being included. And now the hon. member asks us what is wrong with it. I think the hon. member has made a very stupid interjection. The Minister must realize that he will have to offer the most cogent reasons for including these companies I have referred to the exclusion of others. I do not intend aggravating the position. I would, however, ask the hon. the Minister to give the suggestion which has been put forward by this side of the House the most careful consideration. As I have already said, there are no political implications involved in this matter because we all are out only to do the best for our South African public in this field. Therefore we should like to urge the Minister to go slowly with this matter. After all there is no urgent reason why this House should be rushed into validating an illegal agreement. Let us rather proceed to give the matter the most careful consideration in order to evolve a scheme which will carry the approval not only of everyone in this House but also everyone in the country.

Before I sit down I should like to raise one other aspect with the hon. the Minister, an aspect which he did not deal with in his opening remarks. From Clause 6 of the Bill I notice that the Minister is proposing introducing a new Section 24 (4) reading as follows—

I hope I am interpreting the reason for the inclusion of this paragraph correctly. I take it that the Minister is doing so so as not to tie his hands but to enable him at any time in the future to include other companies for whose inclusion a good case can be made out.

So I hope the hon. the Minister will in his reply to this debate indicate whether or not he is going to accept the suggestion which has been put forward by this side of the House and that he will indicate that he has by no means closed the door against the inclusion of any other companies in this consortium and that with that in view he has taken to himself the power to include and to bring into the agreement such other companies as he in his discretion may decide upon from time to time to include. I think it is important that the hon. the Minister should say this because that will go a long way towards ameliorating the uneasiness which exists in the minds of these other companies and of the public. I submit it would be quite wrong for the Minister to say that he is willing to leave this to the consortium, i.e. to determine whether new members are to come in or not. That would be quite wrong I submit. The fact is that members of the consortium have an axe to grind in this matter and it must be quite obvious to them that the more members the consortium consists of the lesser will be each one’s share of the profits. This is therefore a matter which the Minister himself should decide upon. Consequently I urge the hon. the Minister to say in his reply to this debate that the inclusion of sub-section (4) of the proposed new Section 24 is for the purpose of giving him, i.e. the Minister the opportunity to include at his sole discretion in this consortium such additional members as he may from time to time consider necessary. Such an assurance will give a certain degree of comfort to those companies who have unjustifiably been excluded from this consortium.

Finally, Mr. Speaker, I want to repeat what I said earlier on, namely that it is not in the public interest for us to proceed with this Bill at this stage. It will be much more in the public interest if this Bill were to be sent to a select committee for investigation at its leisure and then to bring out recommendations which will have the approval of the entire country.

Mr. Speaker, I intend to be brief but there are certain features to which I wish to refer and to emphasize. We on this side of the House have moved that this matter be referred to a Select Committee. The hon. member for Yeoville has given in detail reasons for suggesting this and I am pleased that we have the support of the hon. member for Peninsula for this proposal. We find it difficult to understand why there should be any hesitation at all or any reluctance on the part of the Government to accept this proposal by this side of the House. First of all, as has been pointed out by the hon. member for Peninsula, there is no urgency to put this Bill through the House—there is no urgency whatever. The hon. member for Peninsula has pointed out that those companies excluded from the consortium have undertaken to carry on with third party insurance despite the fact that their request for an increase in premium has not been met, until such time as this whole question of third party insurance has been properly clarified so that the motoring public would not be prejudiced in any way. Furthermore, Mr. Speaker, no reason has been suggested by the Government as to why the matter should not be referred to a Select Committee. In our view there is every reason for the matter being referred to a Select Committee. When one bears in mind, as was pointed out by the hon. member for Pretoria (Sunnyside), but in a different context, that at least two Select Committees sat on the question of third party insurance, investigated the matter at length, heard numerous witnesses and made unanimous recommendations, what do we find? We find that the Government disregards these unanimous recommendations and puts forward a scheme which goes entirely contrary to these recommendations, a scheme which was not even considered by these Select Committees. Surely under these circumstances there is every reason for the matter being referred back to a Select Committee. More particularly when one examines the proposed scheme and one sees the numerous objectionable features that there are, features which we believe will result in serious prejudice to the motoring public and members of the public who may be injured by accidents on the road and will have claims against this fund. Prejudice also, Mr. Speaker, to these numerous companies which have been excluded, companies many of which have played the game right throughout this period of third party insurance. Not only overseas companies but also companies that are a hundred per cent South African have been excluded from this scheme despite the fact that they have all along done their utmost to make third party insurance workable and despite the fact that they have suffered losses. While I am on this subject of a Select Committee, I should like to deal with one argument raised by the hon. member for Sunnyside in justifying this consortium and in bolstering his argument that it was unnecessary to refer the matter once again to a Select Committee. The hon. member for Sunnyside said that the books of the consortium will be audited and that for that reason the public need not fear that it will not be protected. The hon. member is himself an auditor. He knows very well that it is impossible for the auditor of an insurance company to check each claim that is made and to see whether it is too large or too small. He knows also that auditors are not qualified to decide whether claims are excessive or whether they are too small. Finally, he is the last person who should seriously make the suggestion that because the books of these insurance companies will be audited, the public is protected because he himself was a partner in the firm of auditors of the Parity Insurance Company which was responsible for the worst insurance debacle we have ever had in this country. He is the last person who should make such a suggestion and he knows himself that there is no substance to it. I hope we will hear from some other member on the Government side of the House, or at any rate from the Minister, some reasonable justification for refusing to refer this question to a Select Committee, if the Government intends to persist in its refusal. We on this side of the House are extremely concerned about the effects that the scheme which the hon. the Minister has entered into, will have on the public in general, the motoring public and those members of the public who will be injured by motor vehicles and will have claims. We are extremely concerned about it because we believe that the scheme will result in prejudice to the public in two ways, firstly in a curtailment of the services which the public has had up to now, and secondly in a likely increase in premiums. I intend to deal with both of these in some detail. Firstly, we cannot see how the public can enjoy the same service that it has had when companies doing over 50 per cent of third-party business have been excluded from the consortium, companies which have had staff to deal with this and which have had an organization, a branch and sub-branch structure with staff in all these offices—companies which have had long experience at handling these claims and assessing their value and therefore dealing with the payment of the claims as expeditiously as possible. These companies and their staff are now being excluded. How can the public possibly have the same service? In our opinion it is impossible and we would like to be convinced that it is possible. There is the other aspect to it, Mr. Speaker, and that is the real likelihood of an increase in premium. As has been pointed out, under the scheme entered into by the Minister the companies concerned bear no risk, they will bear no losses. They get their 20 per cent and the payment of the claims and a substantial portion of the expenses will come from the fund which is to be created from the balance. What is to happen if that fund is insufficient to meet all the claims. There are only two possible things that can happen. The premiums will be increased or alternatively the shortfall will be made good by public funds; either way the public will be prejudiced. In the first instance the motoring public will be prejudiced directly and in the second instance the public generally, the taxpayers, will be prejudiced. Under the scheme as it exists there is nothing to cause an insurance company to exercise care in spending the money which will be at its disposal. These companies are to be allowed, first of all, to appoint solicitors or other persons to meet claims in their discretion. As has been pointed out by previous speakers on this side of the House, they are to be given 20 per cent of the premiums to meet their expenses. Obviously, they are going to want to dispose of the claims as quickly as possible to spend as little of that 20 per cent as possible so that they will have as big a profit as possible from that amount. That sort of attitude can only act to the prejudice of the motorist because claims are bound to be higher and payments are bound to be higher and so are expenses. If an insurance company appoints an attorney, for example, to investigate claims and to settle them, the attorney’s costs will not come from the 20 per cent which is allocated to the insurance company but from the fund. Therefore in our view it is inevitable that the fund will be insufficient to meet the claims against it. That shortfall will have to be made good from one or other of the sources I have mentioned, both of which are to the prejudice of the South African public. So, Mr. Speaker, we see every reason why this matter should be referred to a Select Committee so that this question can be investigated further and we can then once and for all decide on a third party scheme which will provide the maximum cover to the public at the minimum cost, which is what we all want to achieve. There can be no question of that. But we on this side of the House do not believe that the Government will achieve that result by the scheme which is now before the House. It has also been pointed out that this causes prejudice to the companies which have been excluded, or at any rate to those companies that have all along the line played the game. It has also been pointed out that it is against the interests of South Africa generally because it is a scheme which does not have the confidence of the financial world. In my submission, Mr. Speaker, these are very sound reasons why this matter should be further investigated. I would urge the hon. the Minister to accede to the request of this side of the House to refer this Bill to a Select Committee. Before I resume my seat I wish to emphasize that if the Government were to do this there would be no prejudice to the motoring public. There would be no prejudice because insurance companies have said that they are quite prepared to re-insure on 1 May 1966 despite the fact that their request for an increase in the premium has been turned down. I would point out further that every company which does third-party business is registered under the Motor Vehicle Insurance Act, 1942, and as long as they remain registered under that Act they are obliged to undertake third-party insurance until such time as they have had their names withdrawn as registered companies. So, Mr. Speaker, there can be no question of prejudice to the public. There is no urgency and the matter can well stand over and be properly investigated before a scheme as dangerous as this is put onto the Statute Book. I would therefore urge the hon. the Minister to accede to the request of this side of the House to refer the matter to a Select Committee.

I should like to appeal to hon. members to come forward with new arguments. Hon. members are not only repeating arguments used by previous speakers, but are also repeating themselves time and again.

In contrast with hon. members on the opposite side I want to approach this matter from the motorist’s point of view. In order to see this matter in its correct perspective we must go into its history. We had this Parity debacle which caused thousands of motorists great inconvenience. Thousands of motorists found themselves in great difficulties as a result of the Parity episode. It is interesting to note in passing that the hon. member for Yeoville wanted to lay the blame for that on the shoulders of the hon. Minister. He said that Parity was not to blame for attracting bad risks with their lower premiums. He put forward the view that they had attracted the bad risks to them as a result of a low premium and that it was really the fault of the Minister who should have prevented it. The hon. member apparently took another view of the matter when the hon. Minister pointed out that, at that stage, he had not had the statutory powers which would have enabled him to do so. This was a case of an emergency arising, and something had to be done very urgently. Now it is interesting to note that nobody took any interest while that emergency was prevailing. What was the point of view and what the attitude of these people, who are now shedding crocodile tears because they have been excluded from the consortium, when thousands of motorists in South Africa were in this fix? These people held themselves aloof. The problem of motor vehicle insurance left these people stone cold. Now that a good foundation has been found on which a future insurance scheme can be built up, however, these people want to come into the picture. These people realize that a good foundation has been laid here and they see their way clear to operating on this basis. Who are the people who have been excluded from this matter? A major argument has been waged from the opposite side of the House on behalf of the people who have been excluded. Who are the people who have been excluded? I want to point out to you that the Insurance Act lays down that a company has to make certain investments in South Africa, principally in the form of Government bonds or municipal bonds, etc. When an insurance company has confidence in South Africa it can usually give proof of this by investing in immovable property or in buildings in South Africa. In other words, a good test of the degree of confidence which an insurance company has in this country would be to determine how much an insurance company owns in the form of buildings in South Africa. It would be interesting to ascertain who the people are who are talking outside. It is a pity that we should mention names, but the example was set for us by the opposite side of the House and in that case it is perhaps necessary that we on this side should also mention names. Two years ago when the Royal Insurance Group, which is the largest insurance group in the Republic, took over the London and Lancashire they sold all the Cape Town buildings of London and Lancashire. When the Royal Exchange took over the Atlas group, the Atlas group’s buildings in South Africa were also sold. With the take-over of London Assurance by the Sun Alliance group it has now become known that they intend selling the buildings of the former group in South Africa. These are the people outside who are weeping great crocodile tears because they have been excluded from this Consortium.

[Inaudible.]

I quoted three examples.

I took the Royal Insurance Group, which is the largest insurance group in the Republic, as an example. The hon. member for Yeoville says it is unfair. Does he accept that in this instance an urgent need arose when the Parity debacle affected thousands of innocent motorists? Now they come along and make a plea (and they make frequent mention of the motorist and of the public) which is simply and purely in the interests of insurance companies. All their arguments which they were ostensibly making on behalf of the motorists, amounted in effect to an argument on behalf of the insurance companies. There can be no better proof of the success of the scheme than the desire of hon. members on the opposite side to have this Consortium miscarry. Insurance companies who have been excluded are very desirous of coming in on this scheme. There can be no better testimonial than this for the scheme which is now in operation. It is now a much sought after scheme. They all want to come in on it. The hon. member for Durban (Musgrave) put forward this argument: What is going to happen if shortages occur in the MVA fund? Other hon. members on the opposite side had, just prior to that, put forward the argument that a profit making undertaking and a monopoly would be originating here. They maintained that a very attractive undertaking was originating in this instance and asked why we were being so unfair to these other people. But he destroys their own arguments with the speculation that a shortage in those funds may arise. The hon. member for Yeoville states that it is not in the interests of South Africa and the hon. member for Springs quotes from a London journal. It would be very interesting if the hon. members would elaborate on this matter and inform us who the reporters of that report which appeared in the London paper are. We would like to have a little more information about how that report came to appear in a London paper and why they did not see fit to quote from a South African paper. Why do they not quote from South African financial papers? Why do they have to rely on the London Financial Mail to support their arguments? The third point raised by the hon. member for Yeoville was that it was not in the interests of the public. Now I ask whether it would be in the interests of the public to incur the risk of a repetition of the Parity debacle? Is it in the interests of the public for a state of affairs to continue or to develop which could lead to a repetition of that debacle. This measure is very clearly in the interests of the public. This desire on the part of those other people to come in on this-scheme, is, as I have said, a very clear indication of the soundness of the scheme and of the soundness of the principles contained therein. No better guarantee can be given to the public. But if this scheme is not proceeded with and if this state of affairs should continue as in the past and something went wrong, who would then be to blame? They are so quick to criticize a scheme, but what would happen then? I regard this Bill as a point of departure. It is very clear that Clause 6 (4) of the Bill provides that other companies may be admitted at a later stage. This statutory provision is very clearly made in the Bill. I believe that further proposals for the extension of this Bill can be made in due course. Unfortunately you will not allow me, and quite rightly so, to discuss the principles which one has already seen emerging clearly. We can see that at last it is possible to operate on the basis of merit, that the motorists are doubtless being dealt with on their merits, and this will, of course, depend on further extension of this Act and the establishment of a central bureau where it will be possible to determine the merit of every motorist. As a measure which is essential in a state of affairs such as the one which arose here in the motor insurance industry, this measure is a good one and it is essential that the hon. Minister should deal with it as rapidly as possible. The objections of the hon. member for Peninsula are not valid. It is essential that we obtain a scheme which would enable the motorists of South Africa to feel safe, so that they may no longer be confronted by the risk of further problems as in the case of the Parity incident.

I am sorry we have had to listen to the speech of the hon. member for Bethal-Middelburg because in dealing with a matter which is of concern to practically every member of the public, to introduce arguments that the sale or non-sale of a building is pertinent to the interests of these people, seems to be the height of absurdity. We and the public are concerned with certain issues. The public want to be positive that the measure before this House will be in their interests and they want to be certain that there is going to be a modicum of permanence in third-party insurance in their lives in the future because over the oast few years the position has, to say the least, been a very fluid one. It has been found necessary first of all to set up a commission of inquiry and a report was duly published. No action was taken. In 1963 it was thought necessary to appoint a Select Committee and a very voluminous report was published and a very lengthy Bill was produced, but no action was taken. In 1964 a further Select Committee sat on the matter and a further report was published and a further Bill was produced which this House passed last year. Then towards the end of last session a crisis suddenly arose. According to the hon. the Minister you could not get third-party insurance. I do not think that the hon. the Minister has really satisfied the House or the public that this was actually the case.

Did your side of the House accept that this was the position?

Mr. Speaker, there was no change and everybody got third-party insurance. I do not know of anybody who was prepared to pay the premium and who went to an insurance company and was refused third-party insurance.

After the consortium was established everybody got it

But the consortium did not handle the insurance. We know that some of the members of the consortium were the worst culprits in denying third-party insurance disks. I am not talking for the other companies, I am talking for the motorist in South Africa. The other companies were able to satisfy everybody when last we had to apply for third-party insurance. But the hon. the Minister panicked. If you read Hansard you will find proof that he panicked because when any hon. Minister comes to this House and says that he is going to second by law members of private organizations to serve in a State service, if that is not panic, then I do not know what is.

My objection to the Bill, as it is before us, is that it is an enabling Bill. That is all it is. It puts complete and utter power in the hands of the hon. the Minister. It gives him the right to set up a group of companies or to set up a State organization. As I have said, we have had a commission and two Select Committees and two voluminous Bills were produced, but the hon. the Minister comes to the House and in effect by two clauses in a Bill he is going to change the entire pattern of motor vehicle insurance. This is an enormous responsibility the hon. the Minister is taking. If we look at the previous Bills we will find that the greatest detail had to be given of the way the administration should take place to make sure that we would not have any more debacles in regard to motor vehicle insurance. The Minister does not want Parliament to decide what has to be right for the motorist and how the interests of the motorist and the insurer have to be correlated. He wants to take the power for himself and his Department to determine what is to be done. I should like to pose this question. If the Minister was of the opinion that we should set up a State organization, which he can now do in terms of the new Bill, would he tell us that he would come to this House and simply say: I want to have State insurance, and then leave it at that, and that we would not introduce proper legislation giving the full details of what he proposes to do? I am sure he would, and yet what he is doing in this Bill? He says: You leave it to me and I will take responsibility and do the job. I do not know whether the Minister’s history in regard to this matter warrants that confidence.

But let us try to examine what might happen on the basis of what the hon. the Minister wants us to do. It seems quite clear from the information before us that the insurance companies are now not going to be responsible for any of the losses. This is a matter which was gone into very carefully, and I want to quote, because I think it is pertinent to the whole issue, what one of the Government’s own officials had to say on this matter, no less a person than the Registrar of Insurance. He said—

That is what he suggested, that the whole picture reverses. Whereas at the moment an insurer’s main objective is to protect himself, in future his main objective would be to protect his client because he has no responsibility. And there are further instances of the same type of evidence. The Registrar says—

And that will be the position. But the Minister has told the House that there will be no increase in premiums. Sir, we do not need this legislation for that. The Minister has all the powers in the world to prevent any increases in premiums. He is the only person who can agree to an increase in premiums. As far as the motorist is concerned at the moment, he has got little satisfaction out of this debate except that the Minister has said that there will be no increase in premiums this year or next year. But the Minister knows much better than I do that the whole picture of premiums in relation to third-party insurance takes place over a cycle of three to five years, and I am not at all impressed by the undertaking of the Minister this morning that there will be no increases for this year and next year because the impact of the claims under third-party insurance will not be felt for three to five years; and there will be no need to increase premiums for the next two years. We do not require any such undertaking from the Minister. This we know, but let the Minister tell us what will happen in the fourth or the fifth year, because the Minister has not told us enough. He says premiums will not go up. Is this his own personal opinion or that of his Department, or is it the opinion of authorities such as actuaries and statisticians?

I did not say they would not go up permanently. I said that if accidents continued to increase, obviously premiums would be increased.

We have no information from the Minister as to why there should not be an increase in premium; because the Minister has brought in another factor, and that is that there will be a return on these investments available for the payment of claims, amounting to something like R1,000,000 a year. I do not want to be misunderstood and I do not want it to be thought that I am implicating any organizations in what I am going to say, but this whole concept smacks very much of Parity, because the whole concept of Parity’s insurance was: We will get all the premiums and because we will be so big we will be able to operate successfully; volume is what is required. Now it is true that one must be fair and admit that the premiums Parity charged were lower than those charged by other companies, but this was the whole concept of Parity. And let us make no bones about it; if you look at the evidence of the Select Committee you will find that most officials of the Department were satisfied that Parity was going to exist, and these are the people who are still advising the Minister; and I say that these suggestions of the Minister are running much too parallel to be comfortable for us. I think it is correct to say that there is no principle in this matter. We have a duty to perform to the motorist. That is our basic duty and I for one, who have been involved in this question of third-party insurance as a member of this House for many years, say it is quite wrong that we should be asked simply to pass a Bill of this nature without every possible avenue being explored and without every expert’s opinion being sought.

I only want to deal briefly with one thing more, and that is the question of the actual insurance companies. What worries us is why the Minister has not told us why he selected these companies. If he would tell us that, we would have some premise on which to work, but we are more worried now than we were before we heard the speech of the hon. member for Bethal (Mr. J. W. Rall), because is this going to be the pattern, that certain companies will be eliminated because they have not done this or that? I hope the Minister will tell us that this new concept of private enterprise by selection is based on certain proper foundations. The hon. member for Bethal, pursuing the pattern of his speech and attacking everything that was not South African, asked why had we used in our arguments overseas publications? Now I do not want to read a lot of publications. I presume that all members of the House read these publications, But I have here the South African Financial Mail, which says: “Worst fears of discrimination have been confirmed with the formation of a non-profit company to underwrite third-party risks”. That is a South African paper. The Star of 6 May says: “Worse chaos next year.” Again the Financial Mail:. “Third-party shambles: Schoeman’s claim to place third-party in the hands of a select consortium next year is the final preposterous act of a farce.” I do not want to go on, but do not let the hon. member opposite ask why we do not read South African publications. And if he is really interested I will be very pleased to show him more of these cuttings. Sir, I think it is quite clear that the interest of everybody will be served if the motion by this side of the House that the matter be referred to a Select Committee is accepted.

The unhappy state of third-party insurance has, I think, been ably described by hon. members on this side of the House, but those of us sitting here and listening to the debate and reading the Bill have had great difficulty in finding out just what is happening. Clause 6 of the Bill enables the Minister through the State President to formulate an agreement with insurance companies. We have heard much of this agreement, but I have not seen the agreement and neither has the House. Surely we are all speaking in a vacuum. Why should we in this House enact legislation that is not properly before us? Is this House going to give the Minister a complete blank cheque to enter into some agreement? It is assumed that everybody knows about it. I wonder whether every member of this House has read this agreement. The Minister made the statement that he was morally committed to an agreement, but surely he cannot enter into any agreement without the sanction of this House. You cannot do these things especially after the history of third-party insurance in this country. The public have become completely suspicious of third- party insurance and the companies handling it—I am not naming any special company— after the experience of the last few years. If one reads the report of the enquiry, one is really shocked to see what happened. For the Minister to come to this House and to introduce a Bill which is incomplete, asking the House to give him a blank cheque, is entirely wrong. This House would be throwing away its powers and its rights by passing a Bill of nature without seeing that agreement. The agreement should have been embodied in this Bill. I am not concerned with any of the insurance companies in the country. What I am concerned with is the possibility, from what we have heard here, that this agreement will create a monopoly, something which the Government has turned its face against throughout its history. Every time I have had anything to do with the Government as far as monopolies are concerned, the Government has said that is not their policy; they believe in free trade. Now, there is a parallel to this position as to whether a Company is competent or not to carry out insurance. You will recall, Sir, that in calling for tenders for the Orange River scheme the Government asked would-be tenderers to submit their names and background before deciding whether they were competent to tender or not and the Government published who would be competent tenderers. I feel in this case, where the Government feels that it should protect the interests of the public and the motorist, they should have advertised in the Gazette, asking insurance companies to tender, and the Government should have examined the position and should have declared whether they are competent or not. On that basis, if they want to establish a pool, they would be on sound grounds.

At the adjournment I was dealing with the effect of this measure on the public. The public, as I have said, requires some measure of protection and one is rather concerned that there will be tailor-made settlement schemes. I think the public should know what these settlement schemes are. These things should be disclosed.

Then also the motorist requires protection. It is all very well for the Minister to say there will be no increase in premiums, but that is not enough. When you fix the amount to be paid to these companies who are in this consortium at 20 per cent, there does not seem to be any measure of control in regard to expenses, and that is not very satisfactory. One would like to think that insurance companies are insurance companies, and when we look back to what happened in the last few years, except for one or two companies which went to the wall, we find that the majority of our companies are companies of substance. They made the agreements and struck by their contracts. Notwithstanding what is happening here to-day they will still have to stand by the contracts they entered into some years ago. Third-party risk does not end when your premium cover ends. The Minister might say that he has the power to make agreements. That might be so, but he has no power to make agreements which are not in conformity with the law, and when he made this agreement which he says he is morally bound to stand by he was not acting in conformity with the law. Therefore I feel that in putting this Bill to the House we should have been given a complete picture as to what the Minister wanted to do, and we should have seen that agreement. I personally would have liked to have seen this agreement embodied in the Bill, but now we are asked to accept it by hearsay. We are voting on something we have never seen, something which could affect the whole of third-party insurance in this country. I support the motion by the hon. member for Yeoville (Mr. S. J. M. Steyn) that this should be sent to a select committee. Let us send this Bill to a select committee. There should be no haste over the Bill. After all, we have muddled along, as far as third-party insurance is concerned, for the last few years. I feel that at this stage we should slow down a little and examine the position thoroughly; let us hear all sides; let us see the agreement it is intended to enter upon; and let us get the complete background of what is in the Minister’s mind. It is no good adopting the attitude of wanting to teach these people a lesson. That is entirely unfair and unbusinesslike and it is not in accordance with the financial standing of this country.

The Minister told us this morning that because of the problems that had arisen in connection with third-party insurance of motor vehicles, there was a clear indication for the necessity for the amendments contained in the Bill, and the Minister said that the Act and what flowed from it was a “social necessity”. We all accept that. We, on this side of the House have said repeatedly that third-party insurance is not just a casual kind of insurance, but is in fact a social necessity. But it is a remarkable thing that, having regard to the urgency of this matter, the Minister comes forward with this Bill in a particularly short Session just before an impending general election—and up to now we have heard only two hon. members on the Government side supporting this “social necessity”. Therefore, the first question which arises in my mind is whether they are completely unaware of this social necessity, or have they displayed a disregard for the needs of the community—or can it be that they cannot possibly or honestly support this Bill? There are several possibilities. We know that there are as many motor vehicles in South Africa as there are voters, and every hon. member opposite probably has 10,000 motor vehicle owners in his constituency to whom he should in all conscience be able to say: I played my part in putting on the Statute Book, a few weeks before the general election, the final piece of legislation to ensure that this social necessity will be provided. But what did we find? Quite apart from the justification which we heard from the Minister, we have heard only two hon. members opposite, the hon. member for Pretoria (Sunnyside) (Mr. van Zyl) and the hon. member for Bethal-Middelburg (Mr. J. W. Rall), both with rather nebulous arguments, attempting to justify this Bill, and pointing out its advantages. Mr. Speaker. I am not here to speculate as to what goes on in the caucus of the Nationalist Party, but I leave it to you, Sir, to make a good guess as to the division that exists in their ranks in regard to the need for this Bill and its contents. It is interesting to contrast what has been said to-day, even by the three speakers opposite, with what was said about the “social necessity” in the very recent past. I certainly do not propose to traverse the sorry history of motor vehicle insurance during the last five years, but it has been said here repeatedly that something must be done to cure the evils that became apparent even before 1964. Thus in order to find, if I can find, justification in this Bill, I have to have recourse to the record, to what was said in 1964 and in 1965, and to what was said to-day. For one thing, the hon. the Minister said in connection with the obstruction caused by certain companies after the Parity collapse, the obstructions they placed in the path of motor owners who sought this very necessary insurance, that some of the agents had their offices on the fifth floor of a building. That is in Hansard. In view of the fact that he has assured us that in terms of the agreement at which he has arrived with what has been called the consortium—I must say I do not agree that that is a proper description for this group of companies—a consortium to me means something very different—this is a concession group which has a monopoly. It would be a consortium if it represented the whole industry, or even those members of it who are willing to act in concert. You will agree, Sir, that to use the word “consortium” is giving a very polite name to something which is in fact completely illegal. Now I want to ask the Minister this question: he told us this morning that there would be some 8,000 agents acting on behalf of the 11 members of the concession monopoly group. Does he for a moment suggest that in the case of every one of those agents, wherever he may be operating, everyone will have premises at street level, in the most prominent position in the business or central area of the town or city in which he operates? Does he suggest that he will prevent them from trading, say, on the fifth floor of a building? Surely not! And to suggest, e.g. that the Minister can do anything about these physical difficulties, about the inaccessibility of a particular agent, is with great respect to him, merely drawing a red herring across the trail. He can do nothing about it whatsoever.

You will talk yourself out of your constituency.

I do not want to indulge in any speculation about the constituency the hon. member referred to. I could tell you a great deal about it, Sir—but I want to tell you this: that I will never be so wrong in my assessment of any prospect, including that of my return to this House, as that hon. member was when he was the auditor of a company called Parity, and when he signed a certificate saying that the company had a surplus of

R300,000, when in fact it had a deficit of R600,000.

Order! The hon. member must come back to the Bill.

I have made my point, and I will not come back to it. In regard to the question of convenience, where do these people who own motor vehicles come into the Minister’s consideration? Where does their convenience come into it? I think it is a fair question, and I hope the hon. the Minister will deal with it when he replies. The simple fact remains that if you want to insure a motor vehicle, you will be obliged to go to one of these 11 companies in the monopoly concession group. Most people who own a motor car may not have traded with one of these 11 companies, because most of them are fairly new. One of them has been in business for about a year. What happens in that case is what will happen, say, in my case. As an ordinary member of the public, I carry insurance for all kinds of risks—except the risk of not returning to the House of Assembly, of course. In my situation, I may be dealing through my broker with a dozen different companies, be it for burglary, life, endowment, education, public liability, illness and what-have-you, and it so happens—and I may be a typical case—that I will not be able to find, in the portfolio of companies with which my broker insures me for all these risks, one of these 11 companies, and I have been insured for the last 35 years with some of them. Sir, where is the advantage or convenience— except, of course, that it serves the convenience of these 11 companies—because the moment I am compelled or the moment members of the public are compelled to take third-party insurance—and I speak of myself as one of the 1,700,000 motor vehicle owners; I do not speak on behalf of the hon. member for Cradock (Mr. G. F. H. Bekker) who has just interrupted me; nobody could speak the way he does unless he is a ventriloquist; I speak on behalf of the large number of members of the public who have to take out motor vehicle insurance—in 85 per cent of those cases, at a rough estimate, they will have to start doing business with a new insurance company, of which they have never heard, and which has never heard of them, a company with no record at all, with no background, no customer-supplier relationship at all, and no consideration for each other, as between insurer and insured. The “convenience” therefore ennures entirely for the benefit of that insurance company which is in the group, because in the nature of things they will be heard to say, “Well, you are doing business with us already; we have welcomed you; we are giving you third-party insurance; what about this, that or the other insurance?” Has the Minister thought of the obstruction that might well arise on account of the reluctance of the particular company in the group, which is approached by a new client, by a member of the public not yet insured with one of them, when they say to him, in effect, “This is going to be very difficult; it will take a little time to give you insurance; you have to comply with all the requirements of the Act but, of course, if you were to facilitate matters”—and heaven forbid that I should suggest conditional trading—"if you were to facilitate matters by taking out a life insurance policy or insuring your house against burglary with my company, or insuring it against some other defect, or taking out any other policy, then you can get the token right away; we will make it very easy for you." Sir, it is necessary to speak plainly on this issue. The advantage of convenience—if it has been studied at all by the Minister, who says he has studied it, and who himself referred to what he said in 1964 about the obstructionism of certain companies—devolves entirely on one of these 11 in the group. Nobody else will derive any benefit from this kindly consideration that the hon. the Minister appears to have given them, and not their competitors. The first conclusion one forms, therefore, is that in what is normally a competitive industry like the insurance industry, the hon. the Minister has seen fit to create a monopoly within this industry by bestowing his favours entirely on these 11 companies.

Rubbish.

Did the hon. member say “rubbish”?

Order! Does the hon. member for Cradock wish to take part in the debate?

Sir, if I do no more than provoke the hon. member for Cradock to come into this debate, I will have done a fairly good job this afternoon!

The hon. the Minister, as part of his statement to-day, quoted what he said on 23 April 1965. He should have quoted something else which he said that day. He was asked by the hon. member for Yeoville (Mr. S. J. M. Steyn): “Are there no South African companies which have withdrawn from this field entirely?” And he asked this in reply to the statement which the hon. the Minister had made that: “That vast majority of the insurance companies in South Africa, as hon. members are aware perhaps, are oversea companies” and that these companies had withdrawn themselves from the field of third-party insurance for their convenience … [Interjections.]

Order! The hon. member need not take notice of interjections.

No, Sir; I wish I could repeat what I have just heard, but I dare not do it. In reply to that question from the hon. member for Yeoville the hon. Minister of Transport, at Col. 4677 on 23 April, made the following statement—

In other words, he denied the suggestion that any South African or South African based company had sought to withdraw from its. moral obligation to insure the public against third-party risks. The hon. the Minister rebutted that allegation, and yet he has made it clear this morning and in terms of this Bill that he is taking punitive action against a number of South African companies for the reason —a reason which he denied on 23 April 1965, that they were obstructionists, for the reason that they withdrew from this field of insurance and that they did not “play the game”,, as he put it in another context. Sir, which is true? Surely the hon. the Minister, who has been here much longer than I can hope to be, knows that what was true in 1964 and 1965 did not change after he made that statement, and that any experience that he took into account in nominating those 11 companies as the, shall I say, chosen people in the insurance industry —which proves that it is not necessarily a matter of faith to become a member of “the chosen people”—was completely disregarded by him. He completely disregarded his own experience, and his own information, inasmuch as he knew that, pro rata, there was a large number of South African or South African-based insurance companies which had done nothing to offend against the principle of carrying out their obligations to the public.

He said on the same day, in Col. 4678—

Sir, this is an extraordinary situation. We were told repeatedly that the reason why the companies that made their opinion about third-party insurance well known, that it did not pay them at all to handle it, that they had been losing money on it for years, that they wanted to withdraw or, in the final analysis, obstructed the public in taking out this insurance—the reason was that they were losing money. The hon. the Minister having assured us that they made R2,000,000, we must assume that this year and next year there will be at least that quantum of profit earned out of third-party insurance under the Motor Vehicle Insurance Act—at least that—without any regard to the possibility of an increase in premium, but having regard to the fact that there has been an increase in the motoring public of South Africa and that, subject to a certain levelling off last year and possibly this year, there is every indication that the total number of motor vehicles in South Africa and therefore the total number of insurance tokens required, will increase from year to year—as it does in other parts of the world. In other words, there is a basic or minimum profit of R2,000,000 in third-party insurance. Now, what has the Minister done? He has made his arrangements with 11 insurance companies. He has said to them, across a table and in secret conclave—because up to this day we have not seen the agreement —“gentlemen, I am prepared, as the responsible Minister, to give you an outright present of R2,000,000 a year, to share amongst yourselves!” Sir, this is the fact of the matter, because they do not carry any risks. Which of the 11 insurance companies carries any risk? I hope the hon. member for Pretoria (East) (Dr. Otto) who is bickering about my statement, will get up and tell me that Company is carrying a risk.

I did not say a single word.

I am sorry. Then, Sir, arises this question: how many companies were in fact willing to come to an agreement with the Minister? We must now assume that there was good reason for the Minister to decide that he had to bind any would-be third-party insurers in a certain way, in terms of an agreement. I am not going to discuss that; I am going to assume for the purpose of argument that there was good reason for him to enter into an agreement. The question arises, how many companies were either willing or able to enter into this agreement? This is interesting, Sir, because on 23 April 1965, approximately nine months ago, the hon. the Minister was asked what his policy was in regard to a possible change in the Act and the operation of a third-party motor vehicle insurance scheme, and in Col. 4679 he answered that he would contract with one or more companies. That is true, because we know he has contracted with 11, which by definition, is obviously “one or more”. He went on to say—

The hon. the Minister, in regard to those discussions, should surely give the House to-day, when he replies, the names of those companies who were willing, and with whom he held discussions. If the hon. the Minister can stand up in this House and say categorically that, in the first place, he held discussions with all the companies which were in the third-party insurance field, and that, in the second place, he entered into the agreement only with those 11 because they alone were willing—in other words, the balance of some 50 were not willing or able— then a great deal of our criticism would fall away, because then he was in fact protecting the public interest by this private agreement. I hope, therefore, that in due time, the hon. the Minister will tell us with which of the companies he held the discussions that he promised to hold last April, and which of them, approached by him or his Department, said, “We do not want this; we will not enter into an agreement with you”. In contrasting the attitude of the Minister just a bare nine or ten months ago with his attitude at the present time, it is interesting also to look at this very same debate because, for better or for worse, I had spoken in that debate …

For worse.

I had spoken in that debate. That is not remarkable, but what is remarkable is the hon. the Minister’s reaction. The hon. the Minister—and it will be to his lasting credit—said in Col. 4702—

Sir, can you believe it? Can you believe the hon. the Minister, the Leader of this House, saying that there is merit in anything said by me—but there it stands for all time! Normally, whether I or somebody else makes a suggestion, we get this statement from the hon. the Minister: “You are right off the rails.” But this time there was “merit” in my suggestion.

It must have been a moment of mental aberration.

I want to tell you, Sir, that the mental aberration of that moment is as nothing compared with the mental aberrations the Minister has had about third-party insurance since that moment—because now, according to many criteria, he has gone completely beserk in this matter of third-party insurance. So much for the small beginning of “mental aberration”! The Minister must be very careful.

There is something in this whole Bill which is very, very puzzling. On the one hand the Bill provides very clearly that the State President, which means, of course, the Minister acting on the State President’s authority, may vary the composition of the monopoly concession group; he can admit one or five or 15, or he can take one or more out. I think the hon. member for Peninsula (Mr. Bloomberg) made a very interesting comment this morning. He said, “I hope the Minister has not for all time closed the door to other competitors.” I hate to say this to the hon. and trusting member for Peninsula, but the Minister has in fact closed the door for all time to all other competitors—and I will tell you why, Sir. I think this debate will become a famous debate if the Minister can live down the notorious agreement entered into by him; in the same debate, in Col. 4706, do you know what the hon. the Minister said? He was asked by the hon. member for Yeoville, “What will be the position if other companies then wish to join”?—the situation being, of course, that we were discussing this agreement between the Minister and one or more companies. The hon. the Minister, in replying, said—

Sir, I got the word “group” from the hon. the Minister—

I tell you, Sir, that a snowball in a certain place has more hope of survival than an insurance company outside of this group has of entering it, to-day or in the future. It goes without saying that these 11 companies negotiated with the Minister on this basis: Firstly, that they would take no risks whatsoever as individual companies and, secondly, that they and they alone could or would determine whether there would be any variation in the composition of this “Rand Club” of the insurance industry. [Interjections.] I am told that they should be called the “Schoeman Club”, but I believe that a more appropriate name for this outfit would be “Ben Schoeman’s First Eleven”. They will be the first and the last; there is no doubt about that.

I want to deal very briefly with the statement made by the hon. member for Bethal-Middelburg (Mr. J. W. Rail) who is not here this afternoon.

He at least was nominated.

Sir, they are still worrying about my nomination. The hon. member for Bethal-Middelburg said this morning that he had three examples of the kind of attitude which certain oversea companies then trading in third-party insurance took with regard to third-party insurance and their obligations to the public, and their attitude towards the economy of South Africa. He mentioned the names; I will not repeat them. He said that these three large insurance companies had in each case acquired or taken over another insurance company, and he said in effect that in each case they immediately disposed of the property of the taken-over company. He forgot to tell the House that as a net result of the disposal of an insurance company’s property, certain liquid assets accrued to the seller, to the parent company, to one of the three companies to which he referred. Why did he not tell the House how they disposed of those funds? Because, Sir, he wanted you to believe this morning that in each case these people had sold these buildings and promptly shipped the money off to Britain—which, of course, is not true; it is completely untrue; so what has that to do with the case? Supposing Company A buys Company B and finds that its premises can be sold at a good profit, more particularly because Company A already has a very large and more central building, is that un-South African? How many people on that side have sold properties at a profit, outside of members of the Cabinet? Nobody? Does this never happen?

In the little time left at my disposal, I want to deal with another ill-concealed allegation— and that is that this criticism of the Government and of the Minister, for whom I have the highest regard, is something which has been whipped up by the foreign, anti-South African Press. That has been rebutted to some extent, but an article in the Financial Mail,illustrates the case of one company at present in the monopoly concession group, and also exactly what will happen to the other companies in regard to their financial stability and strength. I quote, not from a foreign journal, but from the Financial Mail which is published right here in South Africa. Dealing with the Vehicle Assurance Fund the Financial Mail says—

In other words, business was not good in that industry last year—

Which, of course, completely proves my statement that the Minister was giving them a present the moment he signed this agreement—

Sir, can you believe that? Within a matter of a few months—because that part of the year was all that could have been affected by this change, due to the change in the Minister’s policy—a company which up till then had had a premium income of just over R500.000, pushed it up to R1,600,000.

and this was from 28 April to 30 June, two months and two days—

Sir, I could go on quoting page after page of criticism, and I would say very worth-while and factual criticism, but I will quote only one other, also from a South African paper which describes this agreement as a bit of blatant gerrymandering. That is not my word; I would hesitate to use it. It refers to this agreement with the monopoly concession group as “blatant gerrymandering” and says—

That, Sir, is spelt with a “y” and not with a “j”!

I want to ask the hon. the Minister a few questions. I hope that when he deals with our criticism—because he will receive none from his side—he will answer these questions so that not only the Opposition but everybody outside this House, the 1,000,000 people who have to buy insurance and who believe in the integrity of the Government—and who will be mad^e to believe even more in the integrity of the Government by 30 March—will have the answers to this series of questions. Will the hon. the Minister tell the House why he chose these 11 companies in a way which discriminated between them and those who he said were obstructionists during 1965 and, if so, since names have been mentioned in this debate, and not by our side in the first instance, will he tell the public the names of those companies against whom he discriminated for good and sufficient reason? Can he deny that amongst the companies which he excluded, which he in fact boycotted, there are 14 South African companies who were omitted, South African companies. We are not talking of these dreadful foreigners who have capital investments overseas; we are talking about South African companies. Is it or was it the Minister’s intention to rescue certain companies which were perilously near the rocks by a mockery disguised as insurance, so that they could fill their coffers with 20 per cent to 25 per cent of the premium money while bearing no risks whatsoever? If that was his intention and he says so plainly, then I have another quarrel with him, but at least I will know why he did it. Is the hon. the Minister aware, as the hon. member for Pretoria (Sunnyside) suggested, that there is no country in the world, with the possible exception of Egypt, where this kind of discrimination has been practised against any industry or any part of its economy? I exclude Egypt—we know the history there. Does the Minister know that 12 of the companies outside the monopoly concession group derive the benefit of their associates being members of this group—in other words, through subsidiaries—and that in fact he has conferred this favour on 23, indirectly and directly? Does he know that? [Time limit.]

The hon. the Minister, in introducing the Bill, referred to the problem with which he has had to contend over these years in finding a satisfactory system. We know that, we agree with him and we have been sympathetic. I think all sides of the House have been anxious to find a fair solution to this problem that confronts us in South Africa. Our system has failed. The hon. the Minister on this occasion has done his best with his Bill. He has given us a copy of the Bill in good time; he has given us an explanatory memorandum; and I think it would have been a very good thing if he had published his speech well in advance so that the whole country could have understood his point of view. I think it is necessary that his point of view should be understood throughout South Africa, because the solution he has ultimately found is not a good solution. I say unhesitatingly that it is a bad solution.

We are discussing third-party insurance and there are three parties concerned in the insurance of these vehicles; The first is the hon. the Minister representing the Government: the second is the insurance company and the third the group of people who are insured. What is the function of the hon. the Minister and the Government in this group of three? We are all agreed on both sides of the House that it is the function of the Government not to take part in industry and commerce but to hold the “ring”; to see that there is fair trading, to see that everybody is treated in the same way. in competition. That is our ideal. We stand for private enterprise and hon. members opposite stand for private enterprise, but this Bill does not provide for fair trading. This Bill prejudices the rights of certain insurance companies in South Africa, and I think that in doing that the hon. the Minister has acted unwisely. We had a case put up by the hon. member for Bethal-Middelburg (Mr. J. W. Rail), one of the two members on the other side who have participated in this debate. His complaint is this: He said that in a take-over of one insurance company by another, the foreign company had disposed of its fixed property, of the assets of the company which it had taken over. I do not see anything wrong with that. I think the tendency in all insurance companies throughout the world is to invest in fixed property; they all do so. I am quite sure the hon. member for Bethal-Middelburg has not read the speeches of the hon. the Minister of Finance. The Minister of Finance told us a few days ago that insurance companies were not using their assets to provide loans for him; that they were putting their money into fixed property, because if they put their money into fixed property it means that they will get appreciation. Here his complaint is that these companies have realized their assets and are using that money in the interests of the company. Sir, what is the solution to this; what should we do? I do not think we can go on saying that this consortium should act for us. I am reminded of the old lady who told her minister of religion that she had derived much spiritual support from the comforting word “Mesopotamia”. The Government now has a new word “consortium”. When they find themselves in difficulty they say “we will form a consortium”. This is not the first time. The hon. the Minister of Economic Affairs told us of a consortium. He told us he did not form the consortium, but he told us that he was disposing of the assets of South Africa to a consortium in the matter of Klipfontein Organic Products. Here we have this idea of a consortium. If the hon. the Minister feels that he should establish a consortium and therefore eliminate competition why not let us have more than one consortium? In Clause 6 of the Bill we are told of the new agreement, an agreement; there will be only one. An hon. member here has pointed out that it should be possible for another group to come along and say: “We will also form a consortium and we will give financial guarantees.” I think that should be the approach. There is no reason why the Minister should not at least consider it. If that is not sufficient I think we should be prepared to accept the proposal of the hon. member for Yeoville (Mr. S. J. M. Steyn) that this Bill should go to a select committee for consideration. I would go so far as to suggest the nature of this select committee. I think it should be the responsibility of the Minister of Finance. I think it should be a select committee under the chairmanship of the chairman of the Public Accounts Committee because this is a financial matter; it is not a matter which should be entrusted to the Department of Transport. The only connection that the Department of Transport has with this undertaking is that it deals with vehicles. I think this should be handed over to the Minister of Finance and his Department. They should give us the solution because it is a financial matter and we in this country depend on competition. We should have competition even in this type of insurance. I think the hon. Minister has given this group of companies a monopoly which is quite contrary to the monopoly laws of South Africa and contrary to the monopoly laws of all democratic countries. Therefore I think that he should hesitate, he should think again, because on these lines he will never get a proper solution. He will create a good deal of jealousy amongst the insurance companies themselves.

Mr. Speaker, finally this, how can the Minister of Finance appeal to insurance companies to participate in the loans he is raising to-day if the Government treats them in this way?

How can he do that? Here we have on the one hand this differentiation between the companies and on the other hand the Minister of Finance appealing for their funds, their money and their support. I think it is grossly unfair and I think the Minister should consider the matter again to get a satisfactory Bill.

When one comes to the end of a debate on a matter of great public importance such as this, a matter which concerns every single member because, as somebody has already pointed out, everyone of them will have probably 10,000 motorists at least in his constituency, it is remarkable that there has been no contribution of any substance whatever from Government members. Two speakers in all on the other side have taken part in the debate.

You are talking nonsense now.

Sir, what is even more disappointing and more indicative of the sort of Bill this is, is the fact that not one member on the Government side who served on the two Select Committees which preceded the 1964 Bill has found it necessary to take part in this debate. For two years that Select Committee sat on the subject of motor vehicle insurance and both Select Committees produced unanimous decisions. Could anything be more evident of the approach of this side of the House and of hon. members on the other side of the House wanting to find a solution to the problem of motor vehicle insurance in South Africa? Sir, I do not blame the hon. members on the Select Committee, I know the interest that they displayed, I know the sincerity they displayed, I know the honesty of purpose and of direction with which they approached the subject. In those circumstances, knowing those hon. members, I am not at all surprised that they have not taken part in this debate. They could not possibly in all honesty, in all conscience, support a Bill like this.

Mr. Speaker, what is the Bill? This Bill is nothing more or less than a public scandal which will benefit a few companies selected by the hon. the Minister, to the detriment of every single motorist of South Africa. Mr. Speaker, if it is nepotism—it certainly would be nepotism—for the Government to give fishing and diamond concessions to its friends, then this, Sir, is even worse nepotism than that could ever be more so because in the indulgence in this sort of insurance no risk is taken whatever. You need to have no business acumen whatever, you need to make no real efforts whatever, and you are guaranteed a profit. What the Bill does is to give to certain selected companies a present of R4,000,000 this year, and when the premiums go up, as I shall demonstrate they must, Sir, a present of even more as the premiums go up.

Mr. Speaker, what are we concerned with here in insurance in the motor vehicle insurance world? The one is security, security in the sense that a company will not go under; in the second place we are concerned with the lowest possible premium that we can possibly get in South Africa for this sort of insurance, and thirdly, we are concerned with a proper service, not only in entering into these contracts, but also so far as the settlement of claims is concerned.

Now, Sir, let us consider the lowest premium possible. The hon. Minister has abandoned his responsibility to the motorist in South Africa. He has abandoned this to a group of 11 companies whose interests will best be served if the premium income is increased. That is what the hon. Minister has done. But who is going to pay for this? The motorist is going to pay for it. The companies are not going to pay for it and the hon. Minister has in effect said to-day that he is going to use this Bill to re-negotiate the agreement which he had with the 11 companies of this consortium. The hon. Minister says he is morally bound by it. Mr. Speaker, Mr. Justice Marais who sat as a commissioner in the Parity inquiry (Para. 253)—and he saw this agreement, no one else has seen it; the hon. Minister has not seen fit to publish it, and I am not surprised when one considers what is in this report—the hon. Mr. Justice Marais said that if the fund suffers a shortfall during any particular year, such will be satisfied by the companies in terms of their guarantee and be reimbursed to them in the following year or years, resulting from an adjustment of the premiums which will be fixed by agreement with the Minister of Transport. Mr. Speaker, the honourable Judge saw this agreement and he said also—

He went on to say that “the only risk lies in the possibility of exceeding the 25 per cent allowed for their administrative costs, agents’ commission and profit”. Then he said—

Now, Mr. Speaker, this is what the commissioner, a Judge appointed by this Government, said about this very scheme. I want to say to the hon. Minister in all fairness that when he made this announcement, that commission was already at work and, Sir, subsequent to the agreement with the consortium,this report came out. It is a Government report and if the hon. Minister will not have regard to what we have to say, surely the hon. Minister will have regard to what a Judge of the Supreme Court said about the scheme. But, Sir, I want to say this to the hon. the Minister, not only has he abandoned his control over the premium income. We have been through all this in the House before. We have had Select Committees, we had a Bill in 1964 after Parity collapsed. The hon. Minister had placed firmly on his shoulders the decision as to how third party should be conducted. He could make all sorts of regulations. He had carte blanche powers to see that no insurance company went under. He was given the responsibility for the motorists of South Africa, for the public in South Africa. But what has he been doing? He has abandoned that responsibility, abandoning the duty of this Government to see that premiums are kept as low as possible. In terms of this agreement, he has guaranteed any loss there may be and, Mr. Speaker, as has been pointed out so ably by other speakers on this side, once you have no financial interest in the settlement of a claim, you cease to be a businessman. It ceases to be a business deal. It then becomes to your advantage to settle as quickly as possible by settling at the highest figure rather than the lowest.

The hon. Minister spoke about agents. He said that there will be sufficient agents. He has guaranteed that the number of agents will be sufficient. I think he quoted something like 8,000 and he said: “Die betrokke maatskappye het al 8,000 agente aangestel.” Mr. Speaker, that is not the problem. The question of agents presents no problem at all. Getting your insurance and signing a form, a prescribed form, is no problem at all. The problem that is going to arise here under this arrangement that the hon. Minister has made is at the other end of the insurance contract, that is when someone has been run down and a claim is made. In this country these 70 or 80 companies have built up a service of claims consultants, of experienced men in the affairs of insurance. The hon. Minister is never going to be able to replace them. He may do it in twenty years’ time, but he is not going to do it this year or next year or in five years. Does the hon. Minister really expect that the public is going to be served by the personnel of these eleven companies where before 70 to 80 companies were doing this? It is nothing to being an agent. All you have to do is to see that people come in, sign a certain prescribed form and to issue them with a token. But to be a claim consultant, to be an assessor, to be someone who recognizes the value of a claim, that is the work of an expert. Those experts are there. You have the manpower in South Africa there already in all the companies. Now the hon. Minister is going to exclude them. How can he possibly justify that? Because, Mr. Speaker, this is going to result in a shambles for the general public. Those are the ones who are going to suffer and if those who are injured do not suffer immediately because their claims are handled by some inexperienced man, the motorists are going to pay for it the year after. Let us make no mistake about that.

Now, the hon. the Minister has said that he feels himself morally bound by this agreement. I appreciate the hon. Minister’s difficulty. I appreciate that the hon. Minister is the sort of man who would feel morally bound by any agreement that he has made, but I want to appeal to the hon. the Minister that in this case he need not regard himself as morally bound because this agreement has been declared invalid.

It has not been declared invalid.

In any case, an interim order was granted, and the judgment of the court was that the members of the consortium were restrained from saying that they were the only persons entitled to do insurance under the Act. The only basis on which the judge could have said that, Mr. Speaker, is that this agreement which the Minister has with the consortium has no force in law at all. It has no force whatever. In other words, the judge could never have made that order restraining the companies from holding themselves to be the only companies entitled to do motor insurance, if the agreement was valid and lawful. So in that regard the hon. Minister need not feel himself morally bound by it because it was conceived in error, it was ill- conceived. Perhaps the hon. Minister did not realize at the time that the commission that he had appointed to look into this had as one of its terms of reference to recommend, if necessary, legislation to deal with this matter, and subsequent to that agreement it reported, and it reported very adversely on this agreement. The hon. Minister need not fear that he is not honouring his word if in those circumstances he does not keep to the agreement.

But I want the hon. Minister also to have regard to the moral attitude that he should adopt to those excluded companies, because he must not forget that it is the bulk of the excluded companies which were part of an agreement to cover all the hit and run and uninsured vehicles without receiving any premium, in the public interest, over all these years. It is those companies who have played the game. I want to remind the hon. Minister of this. If he feels himself morally bound by that agreement, then surely the hon. Minister must feel himself morally bound also by the statements made in this House and the one I want to quote to him is in Col. 4702 of last year’s Hansard, when he was asked by the hon. member for Yeoville (Mr. S. J. M. Steyn)—

the hon. Minister said—

Sir, that is an undertaking. Is the Minister not morally bound by that? Obviously the Minister is morally bound by that, far more morally bound than he is by an ill-advised, illegal agreement. Surely a statement made by him to the public, to the insurance world, is of moral binding force. I want the hon. Minister perhaps to indicate to us which of these companies that he has excluded have not played the game, and in what respect they have not played the game, because I want to tell him that one of the companies that he has selected was not playing the game, in regard to which I have certain documents here, the company mentioned by the hon. member for Yeoville. I am not going to mention the name of the company, but I want to tell the hon. Minister that I have this document here and before he concludes any agreement on any moral basis in regard to this consortium, he should have a look at this document.

Then the other matter I wish to refer to very briefly is a statement by the hon. Minister in Col. 6340 of 20 May 1964, the year before last, when the hon. Minister was introducing the Motor Vehicle Insurance Amendment Bill, the 1964 Bill. He said then, as has been stated on many occasions in this House—

That is the proper attitude to adopt. The hon. Minister should not exclude anyone from this consortium. He should not deny to anyone the opportunity of taking part in third-party insurance. If there is competition, such competition will benefit the motorists. It will always benefit the public. That is the experience of commerce.

But I want to tell the hon. Minister something else, that if he is just going to pass a Bill like this, something that he was apparently panicked into last year, then he must have regard to how this is going to affect the rest of the Act. There is a provision, for example, in the Act that insurance companies have a right of recourse in certain circumstances, where for example there has been drunken driving or other circumstances resulting in accidents. It is not used as often as it could be used, but it is used in some cases. I venture to suggest that there will be no right of recourse exercised by members of the consortium. Why should they? Why should they indulge in actions for the recovery of money which is guaranteed to them by this Government? Why should they cut down their guaranteed margin of profit when they can use it to buy a business? Does the hon. Minister not appreciate that this is just what he is doing for those 11 companies? He is giving them the opportunity to buy business from other companies. He is giving them an unfair advantage. It is not only the third-party insurance that is going to be affected. If you have the right to go in for third-party insurance you have the right and the opportunity to say to a person: Look here, I also sell fire insurance and life insurance, and so on. That is the point. I would not know whether the hon. Minister appreciates that. If the the Minister does appreciate that, then, he has so much more to explain to this House as to why he has entered into this agreement. On that basis alone it is bad enough, but this gives a guaranteed profit to the few. Mr. Speaker, anyone no matter whether he is sound or unsound—the question of the soundness of the company is no longer of importance—anyone who is taking part in this insurance received a profit guarantee from the hon. the Minister. It is nepotism of the very worst kind, because what in fact the State is doing is robbing the public and giving to the Government’s friends a present of R4,000,000 minimum a year. That is what is happening. The hon. Minister has agreed …

Order! The hon. member is now going too far in accusing the Minister of robbing the public and making a present to friends, or to the Government’s friends.

I withdraw that. Let me say that the Government is robbing the motorists to pay some companies, which must be the Government’s friends, a guaranteed R4,000,000 per annum.

Order! The hon. member must not say that.

Mr. Speaker, let me say that the hon. Minister has entered into an agreement with the 11 companies. We do not know how he selected those 11 companies. He has not told us yet and I hope he will tell us in reply to the debate. Actually, he says to them: “Look, you can undertake motor vehicle insurance and no one else.” (He excludes everybody else.) “But I tell you moreover that I will guarantee you a profit of 25 per cent, and if you do not come out do not worry, we will adjust the premiums next year.” In other words, what this agreement says is; You can have a guarantee to make a profit and I will let the motorists pay for it, whether you carry on your business economically or not. Mr. Speaker, it is a public scandal and nothing else and the hon. Minister has got a lot of explaining to do to satisfy us in the first place how he selected those 11 companies. In the second place, why did he exclude the other companies and in the third place, why has he abandoned his responsibility and his Government’s responsibility to every motorist in South Africa to ensure that the premiums remain as low as possible. There is no better formula than the time honoured formula adopted by every Western country in the world that has third-party insurance and that is to apply commercial standards and to put it in the commercial field and to apply those standards to the settlement of claims and the investigation of the whole business of third-party insurance. In regard to that, and having regard also to the history of third-party insurance which has always been the subject of public inquiry, the subject of inquiry by select committees, a matter which has been discussed in this House repeatedly, and which has been the subject of unanimous agreement in the Select Committee as far as both sides of this House are concerned—in that spirit that the hon. member for Yeoville has asked for another select committee where the matter can be properly thrashed out and can be looked at thoroughly in the interests of South Africa and not in the interests of an hon. Minister who has made an agreement which he feels he is morally bound by regardless of the consequences to the South African public.

In the first place I just want to address a few words to that hon. member who has just sat down (Mr. M. L. Mitchell) in connection with the objectionable remarks he made. Objectionable remarks can never take the place of sound arguments. The hon. member spoke about a scandalous state of affairs. I think his speech was a scandalous speech. I just want to deal with a few of the scandalous remarks he made. The Speaker asked him to withdraw one of those remarks, namely “robbing the public so that the Government’s friends can make R4,000,000 profit a year.” I think it was a scandalous statement. It was a scandalous statement and that is why he withdrew it, and he then tried to put it in other words having the same meaning. We do at least expect good behaviour from the hon. member in this House, even if he cannot be courteous. Furthermore, he spoke about “a guaranteed profit of 25 per cent”. He said that these companies had been guaranteed a profit of 25 per cent. This is another untruth. Is the hon. member not ashamed of himself for spreading these untruths?

That is what the Judge said.

25 per cent is allowed for administrative costs, All the companies have over the years, complained that it was totally inadequate; 5 per cent is for commission and 20 per cent for administrative costs. This has always been the agreement with the companies.

Nothing for profits?

Nothing for profits. Why is the hon. member laughing? The hon member makes himself look ridiculous with a remark like that. There are no profits. All profits are to be returned to the motorist. The agreement with the companies has always been that they obtain 20 per cent for administrative costs and 5 per cent for agency purposes. This is the so-called 25 per cent profit which the hon. member spoke about. Is the hon. member not ashamed of himself for making such false allegations? No provision has been made for profits. What is the position in regard to the administrative costs? 1 had a few inquiries made in other countries where third-party insurance is undertaken by companies, and the information I received is that the costs of administration and commission in those countries are as follows: Turkey 25 per cent to 35 per cent; Spain 33 per cent; Switzerland 35 per cent; Japan 32 per cent; Germany 30 per cent to 35 per cent; Holland 35 per cent; Israel 30 per cent and Scandanavia 25 per cent to 30 per cent. That is the position of companies in those lands.

And 25 per cent here?

But the hon. member was telling an untruth when he spoke about the 25 per cent profit which the Government gave to its friends. That is all I want to say to that hon. member. I hope that in future he will try to behave with a little more decency in his speeches.

I now want to touch upon a few matters which were raised by the hon. member for Yeoville (Mr. S. J. M. Steyn). The hon member said, “the court decided that my action was illegal.”

I said: “the agreement”.

As usual the hon. member is not certain of his facts. He allows his words to run away with his common sense. I have here the Court’s findings. All that the Court said is that the status quo should be maintained until the matter is argued on the 15th. The case is sub judice.

Read Clause 4 of the Agreement.

I have read it. It deals with the maintenance of the status quo. That agreement is not in operation yet and will only come into operation with effect from 1 April of next year. In other words, all the registered companies still have every right to undertake insurance. They have not yet been prohibited from doing so. Either the hon. member did not read the findings or he did not understand it. It simply means that the status quo should be maintained until the case is argued on the 15th of next month. As yet nobody has been excluded. In other words, that agreement which I entered into is not in operation at all, and those companies undertook not to advertise that, with effect from May of next year, they would have the sole right as far as insurance is concerned, but the hon. member also said something else which was absurd. He said:

But surely that is not the truth, Mr. Speaker? When and where did “those in authority” decide that Parity could charge lower rates?

Yet nothing was done about the matter after the Select Committee had reported on it.

The hon. member just made another absurd statement. Apparently he did not read up on the matter. For years Parity charged a lower rate than that of other companies. What is more, the hon. member ought to know that the Minister and his Department had no say in regard to premiums. As a matter of fact, the hon. Minister was obliged to publish what the Insurance companies said their rates would be. Why is this hon. member making such allegations now? Surely his allegations are quite unfounded and devoid of any truth. Furthermore, the hon. member said the most foolish thing I have heard for many a long year. He said—

In other words, the Unemployment Insurance Act will then apply to third party insurance. It amazes me, Mr. Speaker, that a sensible and intelligent member such as that hon. member can say such an absurd thing. The Act does not make provision for a rate in terms of which compensation must be paid. And apart from that the hon. member must surely know that any claimant who is dissatisfied with the amount which the company wants to pay out to him can go to court. He can receive a decisive answer from the court at any time. Surely no company has the right to lay down a certain rate for any physical handicap or for any injury which a person may have sustained.

Read this advertisement from the Consortium.

The hon. member does not understand it correctly. But quite apart from what the Consortium has to say, surely the hon. member ought to know what the Act says in this regard? Surely he ought to know what the legal procedure is in this regard? Surely he must know that any claimant who is dissatisfied with the amount offered him by an insurance company can go to court? In fact, many do go to court. These are the kind of arguments which hon. members opposite put forward with the sole purpose of rousing motorists outside against this legislation and against this plan which I am introducing in connection with third-party insurance. Hence the statement of an hon. member of the opposite side that “it is to the detriment of every motorist in the country”. But surely that is not the case. Let me refer in this connection to what was said by the hon. member for Hospital (Mr. Gorshel). He alleged that the advantage which these Consortium companies would gain from this agreement would be tremendous. In this connection he mentioned how the premium income of a certain company had increased during the month of April to June last year. But what does that have to do with the Consortium? The agreement which I entered into with the Consortium only comes into effect in April of next year. The increased premium income to which the hon. member referred is an indication of something else, i.e. how many thousands and thousands of motorists there were towards the end of April last year who had not yet taken out any insurance. It was then that these companies, with whom I had talks, went to work to insure those motorists. It is they who went to work to insure these people with whom the other companies would have nothing to do. Hence the increase in their premium income. But surely this had nothing to do with the agreement which, at that time, had not yet come into operation? The only thing the hon. member managed to prove is that how right I was in entering into such an agreement, for if I had not done so there would probably have been a few hundred thousand motorists at the end of April who would not have been insured.

Allow me to refresh the hon. member’s memory in regard to what the state of affairs in connection with third-party insurance had been last year in April and also in general. Hon. members know that this legislation is probably the most unpopular legislation on the Statute Books. There are continual complaints on the part of the public: they complain about high premiums, they complained, and quite rightly too, about the companies which went bankrupt, thereby compelling them to take out insurance again, etc. As a matter of fact, there were complaints at every party congress that people did not want this third-party insurance. And to a very large extent they were right, for many of them had been heavily burdened when they had had to take out insurance again after the companies had gone bankrupt. Two commissions were appointed to investigate third-party insurance: in the first place the Joubert Commission and after that the Du Plessis Commission. I even sent officials to New Zealand to go and investigate the insurance schemes there. In addition, two Select Committees were appointed to investigate the matter. All these steps were taken in an effort to obtain a satisfactory system, a system which would protect the motorist and which would afford satisfaction.

What, then, was the position at the beginning of April last year? One hon. member said here that there was no proof that there had been sabotage at that time. Yet the hon. member for Yeoville admitted that the position towards the middle of April last year was extremely serious, that there were still tens of thousands of motorists who were not yet insured. He also admitted that obstacles had been placed in the path of those motorists, that there had been numerous companies which had advanced some reason or other, had followed some or other procedure in order to place obstacles in the way of the motorist so that he could not obtain third-party insurance.

Now you are punishing both the guilty and the innocent.

Wait a minute. I am still coming to that. That, then, was the position in April of last year. Towards the middle of April there was absolute chaos and the end of April was the end of the insurance year. The thousands of motorists who were not yet insured had to be insured before the end of April. As I say, there was chaos. And it was done intentionally, and I am not excluding members of the Consortium when I say this. I am not favouring any one insurance company—they were all equally guilty. At that time I asked my Department to make a countrywide survey in order to determine how many tokens had been available at that time, at each place, for motorists. I have all the data here. There were numerous places where very few tokens were available and there were even places where no tokens were available. I have the data here which I can show hon. members. All the companies were equally guilty. I have already said it was intentional. In the main it was due to the fact that I refused to concede to the demand that there should be an increase of 20 per cent in the premiums. Upon this refusal it was decided that no further risks would be run and that the thousands of people who had been insured with Parity would not be re-insured. That was the position in April last year therefore. I want to furnish further proof in this connection. On 20 January this year I received a letter from an agent of one of the big companies, someone living in Springs and carrying on his business in the constituency of the hon. member for Springs. In this letter one finds an indication of what was going on at that time. I do not want to make the name of the company in question public. The agent writes as follows—

I will show the hon. member for Yeoville this letter if he wants to see it. This was the position everywhere. I have said that it was done intentionally and furthermore I want to prove this. On 3 March a meeting of the Advisory Committee for which provision is made in the Act was held. Mr. Whyte, Chairman of the M.I.A., stated that—

In other words, if there had been no increase in the premium, chaos would have resulted. Did hon. members expect us to sit still and allow things to take their own course?

But why select the worst solution?

No, the best solution. Last year the hon. member was very pleased with the solution.

Last year I said that the matter should be investigated further.

Last year the hon. member praised the Minister for taking drastic steps. He said that it was essential that he should do so. Well, the Minister did take steps. I instructed my Department to bring a group of companies together immediately. All of them had to be South African companies, companies whose boards of directors were here in South Africa. There was not enough time left for companies to have gone and consulted their boards of directors in England or in any other country. It was necessary that a decision be given immediately. The Department then succeeded in getting together six companies. We discussed the matter with them and came to an agreement. They then undertook to go to work immediately and insure the thousands upon thousands of motorists throughout the country who were not yet insured. Which is what they did. The Government then felt that a few other companies, overseas companies, should be included. I did not select them. I did not select one of the members companies of this Consortium. As a matter of fact, I had nothing at all to do with it.

By whom was it done then?

The Department. The five companies which were then included were companies which had been suggested by the existing six themselves. I did not, however, select one personally.

But you still remain responsible, not so?

Of course. I have no objections to these 11 companies and I shall tell the hon. member why later. In any case, that was the position. Urgent steps had to be taken as there were only a few weeks left. This Consortium was established and an agreement entered into, an agreement which was signed during the course of the year. It was in the interests of the motorists and it was also in the interests of the country as a whole. For years companies had intimated that they were not interested in third-party insurance. They did not want it, as is proved by what I read from what the Chairman of the M.I.A., Mr. Whyte, had had to say. I had met them in the past and they had told me repeatedly that they were not interested in the business. As a result of their request for a 75 per cent increase in 1960 I called a meeting in my office with the committee of the group in an effort to persuade them not to ask for a 75 per cent increase. They then told me bluntly that they were very sorry but that they were not interested in the business, and that if they could not get an increase of 75 per cent they would not undertake the business at all. At that stage I still did not have any powers and was therefore obliged to grant the 75 per cent increase.

Quite suddenly now every one is extremely anxious about third-party insurance and they all want to participate. But let us be realistic and consider what the true position is. As a whole, this group, which hon. members opposite championed here this afternoon, undertook plus/minus 60 per cent of the third-party insurance. Over against that Parity undertook plus/minus 40 per cent. After 60 per cent the Consortium companies undertook 39.46 per cent. All the other companies together, i.e. those who are not in the Consortium, undertook only plus/minus 20 per cent of the third-party insurance. But now they are suddenly quite concerned about third-party insurance.

Your calculation is wrong.

No, it is not. It is based on the companies’ own figures. I have these figures here.

In that case you are arriving at the wrong conclusion.

No, I am not arriving at any conclusion. I am talking about facts, facts which I have here before me. The hon. member can examine them if he wants to. I have figures here which indicate the percentage of the insurance undertaken by each company. The reason why companies are dissatisfied now, is not so much on account of third-party insurance. No, they think, and quite rightly, too, that they will now lose other insurance as well. In other words, they think that if a person takes out his third-party with a certain company, he will take out his other kinds of insurance there as well. This is the real reason why these companies are now so concerned all of a sudden. But these companies can still compete, they can still advertise and in this way make sure that they retain their clients. There should not be any danger for them in this.

But now hon. members on the opposite side contend that these companies who are members of the Consortium will not be careful enough as far as the payment of claims is concerned. Why not? The Department is now in a position where it is able to keep a much more wary eye on the companies. As a matter of fact, it is much easier to keep an eye on 11 companies than it is to keep an eye on 80. And the Act, as it reads at present, confers great powers upon the Department in this connection. I cannot accept that these 11 companies are going to be so unprincipled as to violate this agreement which was entered into with them and the undertaking they gave that they would be just as careful in future as they have been in the past. After all, they are honest people. I cannot accept, now that they have a monopoly as it were, that they will no longer be careful in regard to claims. I simply cannot accept that. This fund is audited by Brink. Roos and Du Toit. In their auditor’s report, dated 27 January, they have the following to say—

I am certain that they will do this in the future, too. But if they do not do so, then surely the agreement can be terminated. This agreement has not been entered into for a period of 20, 30 or 40 years. The companies know that if they do not abide by the terms of the agreement, the agreement can be terminated.

Hon. members also referred to the Marais Commission. They made a great fuss of this commission’s report. It is quite correct that the Marais Commission did in fact say those things which hon. members read out. But they omitted to read what is said in paragraph 259 of the report, i.e.—

The hon. member for Durban (North) is supposed to be an attorney, but he did not read this paragraph.

Read a little further.

Yes, I shall read further.

I never shirk my responsibilities. The report proceeds to say—

But apparently hon. members opposite do not even understand it. The commission does not say that its conclusions were based on evidence heard from members of the Consortium, but “on an appraisal of expert evidence we have heard on the difficult subject of third-party insurance”. The commission then made certain predictions but pointed out at the same time that those predictions had not yet been tested or proved by argument or evidence. What the commission should have done then was to call in members of the Consortium in order to hear their evidence. This does not mean a thing, therefore, it is no argument. It does not mean a thing because it was not tested in argument or evidence given before the commission on that point. It is and remains only a general postulation and implication. And as for predictions: I have been Minister in this House for 18 years and if I were to add up all the occasions on which members on the opposite side made predictions on matters which served before this House. I would arrive at a very great figure. And not a single one of their predictions has ever come true. Just go back to the years 1950-1 when, as Minister of Labour, I introduced a certain legislative measure in this House. Gloomy predictions were made, but not one of them has ever come true. But quite suddenly now they are extremely concerned about a monopoly which is supposedly being created. But why not? Surely third-party insurance is a social service. Through it the motorist is being placed under obligation to have himself insured. Surely it is the duty of the Government to see to it that the motorist is protected and that he receives the best possible treatment. I maintain that this new scheme is of benefit to the motorist to an extent never equalled in the past. The principle Act even held out the prospect of it being possible to conclude an agreement with one company only. It is even possible to create a State Corporation. That Act was drafted by hon. members on the opposite side, and that is what they anticipated could happen. [Interjections.] Surely a State Corporation would also be a monopoly. A State Corporation can be established to-day, whether the companies agree to it or not, and surely a State Corporation is a monopoly, not so? Hon. members opposite held out the prospect of a State Corporation. They regarded it as a possibility. I do not see anything wrong with it either, provided it is in the interests of the public in general and the motorists in particular.

I have already said that under the new scheme it will be much easier for my Department to keep an eye on things. From now on it will be dealing with a small number of companies, while in the past it had to deal with a large number, up to 80. I also want to say that an increase in premiums is not excluded. In future, as the number of accidents increases and the amounts paid out in claims become more and more, it is of course possible that premiums may be raised. I have to admit this, but something which hon. members must remember is that all the provisions of the Principal Act remain in force. In terms of those provisions it is a requirement that, before any increase in premiums is agreed to, such an increase must be recommended by the Premium Committee. All financial statements must be placed at the disposal of the committee. It is only after I have received such a recommendation that I can decide whether or not to agree to an increase. I may do so, but I can also refuse to do so. I maintain that this new scheme will be in the interest of the motorist in particular. If this scheme had not been introduced, motorists would have already had to pay an increase of 20 per cent in their premiums this year. This would have meant that each motorist would have had to pay 20 per cent more on his premiums this year, i.e., if I had acceded to the claims of the companies last year for a 20 per cent increase. It would also have meant that the motorist would have had to pay 20 per cent higher premiums next year. This would have meant that in two years’ time the motorist would have already had to pay 40 per cent more in premiums than what he is going to pay now.

But members of the Consortium also wanted 20 per cent.

Yes. but at that time they were still members of the group. I say this scheme is in the interests of the public and in the interests of the motorist in particular. It is also in the interests of the motorists in this respect that if one of the companies goes bankrupt at some stage in the future, he, i.e. the motorist, remains covered. It will not be a repetition of what happened with Parity which deprived all the motorists of their insurance when it went bankrupt. Is this new arrangement not in the interests of the motorists? In the case of there being a considerable profit, the motorist will also benefit thereby in the form of a reduction in his premiums. The fund which has been established is a non-profit making fund.

Do you expect any profits?

It is possible. I said in my opening speech that the moneys belonging to this fund are going to be invested and will therefore accumulate interest, interest which will be added to the fund. This never happened in the past in the case of individual companies, as all moneys were deposited in the pool. The possibility that other companies may join the Consortium is not to be ruled out. It is not to be ruled out at all. I just want to say again that I regarded it essential to take steps last year. There was chaos, or rather, there would have been chaos if I had not taken steps. I also think it is a very good thing to establish such a Consortium and to restrict insurance in this way to a small number of companies. I maintain that it is in the interest of the public as well as that of the motorist. And lastly I maintain that these companies will not take advantage of the fact that they now, to a certain extent, have a monopoly.

I move—

In the report of the Railways and Harbours Board, which has been tabled, it is recommended that three new railway lines be constructed—one in Natal, two in the Transvaal. Full details in connection with these railway lines and the reasons for their construction are furnished in the report, but I shall, nevertheless, deal with certain aspects of the matter.

The first railway line I want to deal with is the Vryheid—Empangeni line. In connection with the proposed new line in Natal, hon. members will recall that I mentioned in my Budget speech last year that a survey was being made for the possible construction of a new electrified connecting railway line between Vryheid and a point on the Natal North Coast Line to serve as a highly necessary alternative route for the Natal Main Line.

On account of the economic development of the Republic and the ever-increasing volume of traffic which has to be handled, the existing main line from the Transvaal to Durban will, within the next few years, no longer be able to cope with the traffic offering, and this despite the large-scale improvements effected in recent years and improvements which are still being undertaken to increase the carrying capacity of that line. What happened then was that it became evident that relief for the Natal Main Line would be an absolute necessity by 1970-1, and this could only be brought about by means of the provision of an alternative railway line.

Immediately after it became known that an alternative line was being investigated, representations were received from various quarters in Natal regarding the route the proposed connecting line with the Natal North Coast Line was to follow. The Railways Board investigated the various possible routes and, in view of the representations received, interviewed the supporters of the different routes.

The wishes of the various interests were of a diverse nature, but after the conclusion of the interviews it became evident that local interests mainly advocated three routes, namely (1) from Piet Retief to Candover over the Pongola Settlement, (2) from a point to the north of Vryheid (possibly Boomlaer) through the Mkuze Valley to a junction in the vicinity of Mkuze on the Natal North Coast Line, and (3) from Vryheid to Empangeni.

After the matter had been carefully considered in the light of available information, in the light of the investigation carried out on the spot by the Railways Board, and in the light of the fact that the purpose of the proposed connecting line was, firstly, to divert traffic from the severely taxed Natal Main Line, secondly, to serve a possible future harbour at Richard’s Bay, and, thirdly, to serve as a railway line for the development of the area it would traverse, it was concluded that a connecting line between Vryheid and a place, Lokoza, slightly to the north of Empangeni, would offer the best solution.

Although the Railways Board in its report motivates in detail the preference for the Vryheid—Empangeni line, I want to dwell briefly upon the various routes considered.

Piet Retief—Candover

An electrified railway line over the route Piet Retief—Candover will be approximately 135 miles in length, will cost about R45.500,000 and will follow the southern boundary of Swaziland for a considerable distance as well as running through a Bantu area for a distance of approximately 37 miles. South a railway line will be able to serve the Pongola Settlement directly and will also provide an outlet to the Eastern Transvaal for products from the new Pongola Poort Dam Scheme. The possibilities for irrigation development along the upper reaches of the Pongola are limited, however, on account of the narrow valley in which the river flows and only when the Pongola Settlement is reached, extensive irrigation becomes possible.

Boomlaer—Mkuze

An electrified railway line between Boomlaer and Mkuze will be approximately 113 miles in length and will cost about R35,500,000. The route follows the Mkuze River for a considerable distance and traverses a White area practically throughout its entire length.

According to representations made to the Board, a few thousand morgen of land are under sugar cane cultivation in the area concerned. while sisal is being cultivated on 8.000 acres with the prospect of further expansion; there are also plantations, the utilization of which is entirely dependent upon rail transport.

Vryheid—Empangeni

The proposed electrified line between Vyrheid and Empangeni, on which centralized traffic control will be installed, will be of main line standard. The line will be approximately 135 miles in length, will cost about R40,000,000 and will branch off at a point slightly to the east of Vryheid station and will finally link up with the Natal North Coast Line immediately north of Lokoza. Provision has been made for only one attended station (at Mhlabatini) and 13 unattended interloops, each with minimum goods facilities.

This route passes through undeveloped land for a considerable distance and cuts through Bantu areas for a distance of some 35 miles. The eastern part of the area concerned is under sugar cane and is already served by railway lines to the sugar plantations, while, in the western part of the area—Vryheid/Hlobane /Paulpietersburg—there are 14 coal mines in production at present.

Although more development has taken place in the areas between Piet Retief—Candover and Boomlaer—Mkuze than has taken place between Vryheid and Empangeni, the entire area between the Eastern Transvaal and the Natal North Coast Line is still relatively undeveloped, and on economic grounds a railway line as such is not justified. It has been found that, on a traffic basis, justification does not exist for the construction of a railway line over the Vryheid—Empangeni route, in contradistinction to the two other alternative routes to which I have referred. The state of affairs in this connection is that the daily volume of traffic originating to the north of Piet Retief for transport to Durban will amount to approximately 3,800 gross tons per day by 1972—it is expected that there will be 2,649 gross tons of traffic in the opposite direction— and in the event of a rail connection being established between Piet Retief and Candover or Boomlaer and Mkuze it will only be possible to divert that tonnage of traffic from the Natal Main Line.

The conveyance of coal from the Hlobane/Vryheid area—the main type of traffic that can be diverted from the Natal Main Line—changes the picture in favour of the Vryheid— Empangeni route as appears from the fact that if Tendenka is taken as the central point for the dispatch of coal to Durban over the three alternative routes, the Vryheid—Empangeni— Durban route is 21 miles shorter than the existing route over Glencoe, while the routes over Candover and Mkuze are 161 and 58 miles longer, respectively. For important departmental reasons there is consequently a preference for the Vryheid—Empangeni line.

A further factor worth mentioning in favour of the southern route is the electrification of the Natal North Coast Line up to Mandini; consequently a rail link between Vryheid and Empangeni would mean that the North Coast Line would have to be electrified for an additional distance of 52 miles up to Empangeni (Lokoza) only, in contradistinction to the 152 miles up to Mkuze or 164 miles up to Candover if the proposed railway line were to follow one of these two routes.

Hon. members know that Richard’s Bay is contemplated as a future harbour; it is only situated some 11 miles from Empangeni (Lokoza) and it will be possible to provide a feeding line to the proposed harbour without much difficulty.

Although expectations are that it will take from five to six years to complete the proposed connecting railway line, it is the intention to expedite the work as far as practicable with a view to possibly putting it into operation before the date planned for its completion.

The second railway line I want to deal with is the Metsi—Kaapmuiden line.

Hon. members will remember that during 1961 Parliament authorized the construction of a guaranteed railway line between Hoedspruit and Phalaborwa for the conveyance of phosphate and other ores. This railway line was built to modern standards. A recent analysis of the existing and anticipated traffic from the Phalaborwa area—mainly ores and minerals— has revealed that in order to meet traffic demands. immediate measures are required for the substantial increase of the carrying capacity of that section of the Selati line which runs between Hoedspruit and Komatipoort and which is still of branch line standard at present It has been calculated that the gross tonnage to be transported daily from Hoedspruit in the direction of Komatipoort will increase from 11,250 in 1966 to 25,830 in 1971.

Although it is the intention to make use of diesel traction between Phalaborwa and Komatipoort from August, 1966. it will, with the existing facilities and on account of the restrictions which apply in the Kruger National Park at present, only be possible to cope with the traffic over the Selati line up to about the beginning of 1969. It will be possible to improve the carrying capacity of the section of the line from Hoedspruit to the boundary of the Game Reserve, but the improvement of the section through the Game Reserve is not considered advisable for various reasons, such as considerable earth-works, the damaging of power-lines and delicate equipment by wild animals, the danger to staff when trains have to be serviced at night, and the mutilation of game.

Consequently the Railways Board gave consideration to possible routes for an avoiding line, and in this connection two possible routes were investigated, namely from Hokwe, on the Selati line, to Karino on the Nelspruit— Komatipoort line and from Metsi, on the Selati line to Kaapmuiden on the Nelspruit— Komatipoort line.

Hokwe—Karino.

Although a railway line over the Hokwe— Karino route would best suit the farming community, it would require heavy earth-works and a tunnel, as the route passes through particularly difficult terrain. From Karino this route passes through a White area for a considerable distance up to the junction at Hokwe, on the Selati-line.

A line over this route will be 86 miles in length and will cost about R21,500,000.

Metsi—Kaapmuiden.

A railway line from Metsi to Kaapmuiden, which will be of main line standard, will run immediately to the west of the Game Reserve and will traverse an area which is still relatively undeveloped. The topography of the area concerned is such that the earth-works required for a railway line will be relatively light compared with a railway line over any other route further to the west. The proposed line will be 53 miles in length and it will be possible to construct it at an estimated cost of R9,100,000.

From the information I have furnished, hon, members can deduce that a railway line between Hokwe and Karino would not only be 33 miles longer than a line from Metsi to Kaapmuiden, but that it would also cost over R12,000,000 more to construct. A further important factor is the fact that the speed of trains on the Karino line would be limited to 30 miles per hour as compared with 50 miles per hour over the route between Metsi and Kaapmuiden. It was, therefore, concluded that preference should be given to the Metsi-Kaapmuiden route.

It is mentioned in the Report of the Railways Board that provision would be made in the Draft Estimates for 1966-7 for the strengthening of the existing line between Hoedspruit and the point of Junction with the proposed new line just north of Metsi. As a result of a change in circumstances it is considered advisable to make provision for this work in the Draft Estimates of Additional Expenditure for 1965-6, which will shortly be considered. The completion of this work is expected to coincide with the completion of the proposed new line early in 1969, so that sufficient capacity over the Selati-line will be available as from that date.

Diesel traction will be employed on the new line and provision will also be made for centralized traffic control.

On the basis of the expected total traffic which will be conveyed over the new line during 1969, its construction is justified on economic grounds.

The Departments of Planning, of Forestry and of Bantu Administration and Development were informed in advance of the Railways Administration’s plans in connection with the construction of the two new lines I have already dealt with, and as regards the Metsi— Kaapmuiden line, negotiations were also entered into with the National Parks Board.

The final railway line is the Stoffberg—Roossenekal line.

The construction of a guaranteed railway line between Stoffberg and Roossenekal is being undertaken at the request of Messrs. Highveld Steel and Vanadium Corporation, Limited, and will enable the Corporation to convey magnetite from a mine situate immediately west of Roossenekal, to the Corporation’s new steelworks being established at Clewer, near Witbank. The Corporation indicated that the new railway line would be required by March, 1968, and although it has been estimated that it would take 2½ years to complete the railway line, it is anticipated that by March, 1968. construction work would have progressed to the stage where it would be possible to open the line for traffic.

The construction costs of the line over a distance of approximately 23 miles will amount to about R3,350,000; the line will be of main line standard and steam traction will be employed.

The route of the railway line is as indicated in the Report; two river bridges will have to be constructed and provision is also made for road bridges or subways where the line crosses important public roads. The terminus, the only station on the line, will be situated just west of Roossenekal; ore-trucks will be loaded at a private siding.

According to details furnished by the Highveld Steel and Vanadium Corporation, the quantity of outgoing ore traffic which will be conveyed over the proposed line during the period 1969 to 1974, is expected to be an average of 721,000 tons per year. A calculation based on the estimated quantity of traffic for 1969, indicates an estimated operating loss of R228,000, which, however, will decrease to R137,000 in 1974.

As hon. members know, it is an expensive undertaking to construct a railway line under present conditions, as appears from the fact that the railway line to Roossenekal will cost no less than R145,652 per mile. At present it is the policy of the Railways Administration to recommend the construction of railway lines which are not required for departmental purposes or which are not justified on economic grounds, only in cases where the rail facilities requested are guaranteed by the interested parties against any operating losses, including interest on capital and depreciation. The corporation is prepared to give such a guarantee and the usual agreement has been enterel into; a copy of the agreement is printed as a Schedule to the Bill.

It is a pleasure to be listening to the hon. the Minister in this atmosphere and under these circumstances. We do not want to delay this Bill, because we should not like measures which are being taken for the development of our country to be delayed by this House. As a Transvaler I should just like to say how glad I am to see that two large railway lines are to be built in that province. I am particularly glad about the railway line which will be built to make possible the conveyance of ore for the Highveld Steel and Vanadium Corporation. That corporation will have an important effect on the surrounding Eastern Transvaal areas. I understand that that corporation’s factory will have almost 24 miles of railway line. That means that the Minister is virtually entering into a partnership with the corporation. The only matter that may present certain problems is the question of which of the proposed lines in Northern Natal is to be built through Zululand. I find it a pity that the Minister did not tell us more about the fact that the proposed railway line will run through, a future Bantustan for a long distance. From his statement it appeared that he was concerned about the fact that some of the other lines would run through parts of a Bantustan. I mention that as one of the factors which might count against the construction of such a railway line. The Minister probably believes that it makes no difference. But it might. As soon as such a Bantustan becomes independent, it will want to exercise control over that line. Independent countries do not like to have countries from outside exercising control over their railway lines. I therefore want to express some doubt as to whether these countries, when they become independent, will be satisfied with the position. But the Minister must have given consideration to this aspect. I do not want to say a great deal about it, nor do I want to make an issue of it at this stage. The hon. member for Zululand, who has a particular interest in the railway line running through his constituency, will elaborate on the matter. We shall support the Bill, however, because it is something constructive for the people of South Africa.

We are dealing this afternoon with legislation to permit of the construction of three railway lines. I propose to speak in respect of only one of those lines, namely, the line designed to link the North Coast of Natal system at Empangeni with the Northern Natal system at Vryheid. It is clear, Sir, from the report which we have before us of the Railways Board and from the hon. the Minister’s speech that this new rail link has been designed with a specific point of view in mind, and that is to provide additional railway facilities to carry the heavy traffic which flows from the coal fields of Northern Natal and from the Transvaal to the Port of Durban, for the present time, and to a port which it is intended to build sometime in the future at Richards Bay. The Bill concerns the construction of railway lines and I think all of us are always glad to hear of any line which is to be constructed in South Africa. Because, Sir, we know from history that this is very much a country which develops after the construction of a railway line, and not the other way round. I am therefore very glad indeed to hear that this line is about to be built.

I am perhaps a bit sorry that it is to be built with the object in mind that I have just mentioned. That is to say, it is to provide a through service from the Transvaal and Northern Natal to the Port of Durban rather than to develop the area through which it passes. I do not believe that the two points of view are mutually exclusive, that is the one to provide a through service from one area to another and the other to develop an area through which a railway line passes. I believe that both these criteria can be met if those who plan it and design it wish that policy to be followed. One can understand that the Natal main line is overburdened or will be quite shortly and that this through route and this policy will have to be followed. I do, however, think that in the planning greater benefit would have been obtained by all concerned if this route which has finally been chosen—Vryheid— Empangeni—had passed in one or two respects through established farming areas rather than through Native reserves. According to the report this line is 135 miles long and that 35 miles of it traverse Native reserves. I am not in a position to say that the figure of 35 miles is positively incorrect. I must, however, say that from my knowledge of the area and by making use of certain maps that I have, I feel sure that that figure is not right, and that when that particular figure was calculated the Crown land surrounding the Umfolosi Game Reserve was reckoned as being Crown land whereas in fact it had been passed over to the Native Trust. I would have preferred, so far as this line is concerned, to have seen the growing cane area of Melmoth served by this Empangeni link, or the area north-east of Komboshe, that is to say the Ntambanana/ Heatonville area, also an area where cane growing is being expanded, to be served by the lower part of the route before it reaches Empangeni. Now we know from this report and from what the Minister has said that the other two routes which were considered, the two more northerly routes would have gone much less through Native reserves and more through White farming areas which have a potential. They have a very great potential. I was glancing through Hansard this afternoon and I discovered that the first speech I made in this House under the Minister’s Vote in 1962 was to plead for a link from the north-coast system to the Northern Natal and Transvaal systems to be built; and the Minister’s reply was that it was out of the question at that time because there were not sufficient coal exports to warrant that line being built and the port at Sordwana Bay, which was then the thinking, apparently, of the Minister’s Department. However, we have now reached the stage where this link is to be built, albeit rather further south than we had in mind in 1962. I notice, too, from the report put up by the Railways Board that a secondary object in mind is the question of linking the Transvaal and Northern Natal to a port envisaged at Richards Bay. The language used by the various authorities who speak of Richards Bay and the language used, e.g. in this report differ somewhat. I wonder whether in his reply the Minister could give us some indication as to his thinking in regard to the building of this proposed port at Richards Bay. Would it be fair to say that the intention is that it is something which will be done in the near future, or something to be done in the very distant future? Is it something I can look forward to in my lifetime?

It depends on how long you live.

Now it appears from the report that there is to be a simple junction at Lokoza, which is just north of Empangeni, and that the existing marshalling yards at Empangeni are to be used to marshall the traffic where these two lines join. I very much doubt, if this traffic builds up, i.e. the traffic between that portion of Zululand and Northern Natal, that this marshalling yard will be able to cope with it. I hope the Minister’s Department is aware of the limitations in the facilities at the marshalling yards at Empangeni at present, and I hope we will not get a bottle-neck developing there. I hope that the northern areas, whose case, as I say, I pleaded in 1962, will also get that link. The development of the potential of Northern Zululand is such that there is room, I believe, for a line linking the northern areas of Zululand with the Transvaal system, more particularly as we know it is the policy in respect of this proposed link between Vryheid and Empangeni that it is merely a through route from the north to Durban, and that it is not designed to develop the areas through which it is passing. That being so, I hope the Minister will direct the thinking of his Department towards developing a further link further to the north, possibly to Piet Retief, specifically designed to develop the potential of that area.

There is one other point I should like to mention. The Minister will know, and certainly his advisers will know, that the last few miles of this proposed route pass through an established cane-farming area just north of Empangeni. The line there will pass, where it emerges from the Native reserve, to the junction at Lokoza, through probably some of the finest cane-farming areas in the country. I think that can be said with emphasis. No doubt the expropriations will take place at a time when the sugar industry generally is rather in the doldrums. It is unfortunate, if that is the situation—and I hope it will not be—that that land, very valuable land indeed, should be expropriated at a time when the industry is temporarily at a low ebb. I hope that those who are concerned with the expropriations will bear that in mind, because it may well be that had these expropriations taken place 18 months earlier or 12 months later than the time they will probably take place, the value of that land would have been very much higher than it is at present. I see from the report we have that, whilst the line has been indicated on a map which has been put up with the report of the Railways Board, that route is not necessarily the final route. One does not know the degree of latitude which is allowed and which normally operates in these matters, as to how much of a change in this route is permissible by the Minister’s Department after a report has been tabled in this House. But I notice it is specifically stated in here that this route is not to be taken as necessarily a final route in every respect and that changes may be made.

I will be glad if the Minister will give us an indication of the extent to which that could be utilized to make changes in the route which has been decided on. I may say that during the time when these various routes were under consideration the Railways Board came to Zululand and held a number of inspections of the various routes to be considered. I should like to say how much I appreciate the fact that the Railways Board extended the courtesy to me, as the representative of certain of the interested parties who wished to express their views, of extending an invitation to me to fly in their aircraft over the various areas we had to consider.

I think it remains, then, for me to say that I am very glad indeed that at last a link of this kind is to be built. The report indicates that a rail link in this area was discussed certainly as early as 1950 and that certain surveys took place from that time onwards. I heard discussions when I was a boy of surveys that had been done from the Zululand coast to the interior in order to provide a link of this kind. I believe I am correct in saying that previous Governments over a great many years, and possibly as early as the 1920’s, conducted surveys with a view to putting through this rail link, and that it has been the subject of discussion and investigation from that time onwards. It remains for me to say that I support the legislation to build these railway lines, and certainly the rail link from Vryheid to Empangeni, and we on this side will support it.

I should like to say a few words about the proposed Stofberg— Roossenekal line, because it is situated entirely within my new constituency of Middelburg. I do not say that out of conceit, but because I trust my voters to adopt a sensible attitude. Although this new line seems unimportant, it represents a completely new principle in the steel industry in South Africa. In particular it represents the development in the field of stainless steel, of which South Africa is fortunate in having a large share of the deposits found in the world. Research has shown that we in South Africa have more than 90 per cent of the low-grade chromium deposits available for the world’s future stainless steel industry. It is dreadful to think that all the steel in use at present will be corroded away in approximately 50 years’ time. That is why the world’s steel industry is concentrating on the development of stainless steel. Actually I have only one objection in connection with the matter concerned here, and we cannot blame the hon. the Minister for that. It is a pity that this branch line does not supply ore to an Iscor branch at Witbank, but to the present consumers instead. But since the hon. the Minister is not responsible for that, we can only thank him that he and his Administration have seen fit to build this line through an area which undoubtedly has a great future; it will make a considerable contribution towards developing that area, something which will place South Africa on the world map in the future.

There are one or two points that arise in regard to the proposed building of the line from Vryheid to Empangeni. One is that contrary to the expectations of a great number of people living on the Natal North Coast, they will get an electrified line long before the South Coast. I think the hon. member for South Coast will be the first to say that that is a pity, but that is not my main point. My point is that in the development that is now to be undertaken by the administration it would appear that the link with the contemplated development of the harbour at Richard’s Bay—that the line from the Reef to Richard’s Bay will be the shortest route to the sea. I think I am correct in saying that. I think the distance from Durban to Empangeni is just over 100 miles. That means that Richard’s Bay in the future will become the nearest port to the Reef complex. That being so, I think it is important that we should recognize that fact now because of the repercussions it may have on the existing Natal main line once the harbour is developed at Richard’s Bay. The Minister cannot at this stage, of course, tell us when that development will take place, but that Richard’s Bay will be developed as a harbour is, I think, pretty certain. Then, of course, we will be faced with the fact that it will be more economic to transport many of the goods from Richard’s Bay rather than from Durban. Now, I am not suggesting that there should be any guarantee or anything of that sort, but I am raising this point because we have to bear that in mind when we examine this development, with the prospect of Richard’s Bay becoming a harbour.

The other point I wish to dwell on is this. We will be getting both on the Natal main line and on this new proposed line from Empangeni to Vryheid the extensive use of CTC I would like the Minister in his reply to give an indication of how successful the utilization of CTC has been on other parts of the Railways in South Africa in respect of (a) saving in manpower and (b), which is possibly the more important of the two, the public safety factor. Reports that we have seen from time to time in the General Manager’s Annual Reports indicate that CTC has proved a very successful means of conserving manpower, but I am not so sure that we have had a specific report on the safety factor, and whether this will not place an additional burden on the personnel, the train crews, to make sure that there are no obstructions on the line or that there is no fear of accidents at sidings, as the result of unattended sidings being part and parcel of CTC. This line is going through undeveloped country for a considerable portion of the 100 odd miles and it is proposed to provide only for one attendant station. I hope that the Minister, in considering the introduction of CTC has at the same time considered the human aspect and the possibility of the dangers involved and the additional responsibility which will rest on the driving crew when they take trains through this area, electrified and possibly non-stop. I hope that aspect has been given careful consideration.

The hon. member for Zululand (Mr. Cadman) said that these railway lines should be built for two purposes mainly, i.e., for the development of farming as well as for departmental reasons. I fully agree with him. That would be the ideal position, if you could combine the two; in other words, if you put a railway line through a certain area where there is considerable development and at the same time if that is the best route for departmental reasons. But, as I explained fully in my speech, and as the hon. member will find in the Railway Board’s Report, unfortunately in this particular case we could not combine the two. What I had to take into consideration was that I had to try to get the shortest route from the Vryheid coalfields to Durban because practically all the coal and coke produced there goes to Durban. I also had to find the shortest route to the new harbour at Richard’s Bay. Hon. members will realize, of course, that the longer the route is, the more it costs. But, apart from that, the longer the route is the higher are the tariffs charged, and the greater the expense is in consigning goods, because obviously on the longer route over Candover to Durban it will cost more to transport goods than it would cost from Vryheid to Durban over Empangeni.

In regard to the Native Reserves, they will eventually have to be developed and they will require transport. I do not for a moment envisage that they will remain undeveloped for many years. Development must take place, and even if they do become independent in future they will still require transport. There is nothing exceptional in the fact that there is a railway line running through a particular country, even if it is an independent country, which does not necessarily belong to that country. The ownership need not vest in that country. I quoted the case a few days ago of the line running through Bechuanaland. but which belongs to the Rholesian Railways. We have the line to Maseru, which is part of Basutoland. Basutoland is becoming independent shortly, but that line will not be handed over to Basutoland; it will remain the property of the South African Railways.

The hon. member wants to know what I am thinking about the building of the harbour at Richard’s Bay. I can inform the House that I have given instructions that the planning must commence immediately. What I personally envisage is that directly all the new berths have been completed in Durban Harbour, a start will then be made with the development of Richard’s Bay. That will probably be in 1971 or 1972. There are also some firms who are interested in establishing themselves at Richard’s Bay, and some of them have already approached my Department. That is why it is essential that planning should be commenced immediately so that nothing will be done in a haphazard way, but will be properly planned.

The hon. member expressed doubts as to the adequacy of the marshalling-yards at Empangeni to deal with all the traffic once the link has been built. My reply is that most of that traffic will be through traffic to Durban, but if the marshalling-yards prove to be inadequate they will of course be enlarged. He also says he hopes the Northern link will be built. Personally, I think it will be built. With the development taking place especially as the result of the new Pongola Dam, it is quite possible that in future such a line will become economically justified, and then it will be built. The hon. member said he hoped that we would bear in mind, when expropriation of sugar land takes place, that the sugar industry is now in the doldrums. 1 can assure the hon. member that expropriation by the Railways is invariably based on the consent of both parties. I cannot recollect that any aggrieved party has taken the Railways to court because they are not satisfied with the amount of compensation. It has been a fortunate state of affairs and I am quite sure that the people who have to give up their land will be satisfied with the amount of compensation they receive.

Then the hon. member wanted to know whether I could give any indication as to what extent changes in the route might be made. My reply is that only minor changes in the route will be made, owing to topographical conditions or some other unforeseen obstacles in the way of building the line. As a whole, the route will remain as it is shown.

The hon. member for Umhlatuzana (Mr. Eaton) said he was rather sorry that the North Coast line would now be electrified before the South Coast line. It has apparently slipped his mind that we have already started to electrify the South Coast line as far as Kelso. Then he asked how successful CTC has been. It has been very successful. We have it to-day on the Postmasburg line and we have it from Bloemfontein to Springfontein. We are also installing it between Volksrust and Newcastle, and it will be installed on these new lines that we are building. We are also installing remote control which is one of the preliminary stages of CTC on quite a number of sections, and we also intend installing CTC on the whole line from Ladysmith to Durban. There are three main reasons for the installation of CTC. Firstly, it increases the capacity of the line considerably, secondly, it speeds up traffic and thirdly, it saves manpower. The hon. member knows that considerable time is wasted at crossings where the token has to be handed over from one train to the other and when the guard has to go to the points to let in another train on a loop-line. The introduction of CTC and remote control eliminates much of that waste of time because the trains are admitted to the siding by means of coloured light signals. Consequently it is only a question of exchanging tokens, but there is no delay at the points. CTC is very safe as the whole line is controlled from a particular point and whenever the train is on that line it shows on the board in front of the operator. The trains are controlled by way of coloured lights, and consequently there is no possibility of collisions or of any dislocation. In America, where they have trains running at 100 miles per hour, they have CTC installed on all their railways because it is so safe. As a matter of fact, on many of the American railways they have pulled up the double line and only have a single line to-day operated by means of CTC. With their fast trains they found it was quite safe and very efficient, and it leads to a saving of manpower which is of course very important. The reason why I am introducing CTC, e.g. on the line from Ladysmith to Durban, is firstly, further to increase the capacity of the line. It would be an extremely expensive operation to build another line there to-day. Hon. members know what the topography of Natal is, especially where the main line runs. The only alternative is to further increase the capacity by introducing CTC. The capacity is increased at least by a further 40 per cent to 50 per cent, and it also saves manpower. It eliminates all operating staff at the intermediate stations. CTC can be controlled from Ladysmith right up to Durban by half-a-dozen or even fewer operators. So it saves manpower and it increases the capacity, and that is why it has been introduced on all the important railroads in the world.

Motion put and agreed to.

Bill read a second time.

I move—

Hon. members will notice from the Estimates of Additional Expenditure from Revenue Funds, which has been tabled, that provision has been made for additional expenditure amounting to R35,205,400. Savings which cannot be applied in reduction of excesses owing to restrictions imposed by the Railways and Harbours Appropriation Act, amount to RIO,000. Consequently the revised estimates of expenditure to be defrayed from Revenue Funds amount to R633,968,400, which exceed the amount of R598,773,000 originally authorized by R35,195,400.

The most important single factor for the increase under the various heads, namely Railways, Harbours, Airways and Pipe Line, is the increase in salaries and wages granted to Railway servants with effect from the pay-moth October 1965—in some cases for more than half the amount required The total amount of these concessions is more than R35,000,000 of which amount R16,500,000 will have to be financed from Revenue Funds during the current financial year.

I shall now deal with the most important increases—apart from the salary and wage concessions—under the various heads:

Railways

As regards Railways, the increase of approximately R1,000,000 under Head No. 1 —General Charges—is due to an increase in general office expenses, Sunday time and overtime payments, as well as payments in respect of travelling expenses to the staff.

The increase of approximately R4,500,000 under Head No. 2—Maintenance of Permanent Way and Works—was caused, inter alia, by the greater use of mechanized equipment for the maintenance of the permanent way; the maintenance of houses and buildings also amounted to more than the original estimate.

Nearly half of the additional amount of R5,000,000 required under Head No. 3— Maintenance of Rolling Stock—was required to meet an increase in the costs of repairs to locomotives and other rolling stock. As a result of heavier traffic more repairs had to be undertaken and increased Sunday time and overtime payments had to be made.

As regards the increase of R8,500,000 under Head No. 4—Running Expenses—the contributing factors were, inter alia, an increase in the Sunday time and overtime payments as a result of heavier traffic, an increase in the price of coal, higher replacement and maintenance costs in respect of tarpaulins, an increase in the cost of electricity in Natal and the charter of boats for the transport of locomotive coal.

In the case of Head No. 5—Traffic Expenses—there is an increase of R9,700,000 which was partially caused by higher Sunday time and overtime payments as a result of an increase in traffic, improved scales of expenses, more expenditure on electric lighting, station supplies and equipment.

Expenditure under Head No. 7—Cartage Services—increased by R1,100,000, mainly as a result of the charter of private vehicles with drivers to assist in the delivery of cartage traffic at Kaserne.

Expenditure in respect of Subsidiary Services—Heads Nos. 9, 12 and13A—increased by R1,200,000. This may be attributed, inter alia, to the fact that the transfer of some of the departmental refreshment rooms to private concerns occurred at a later stage than originally anticipated; the employment of additional staff for the Pre-cooling Services, and an increase in the maintenance costs of the cooling sheds also attributed to the increase.

The increase of R100,000 under Head No.14—Nett Revenue Account-. Interest on Capital: Railways—as well as that under Airways (Heads No. 29—R30,000) and Pipe Line (Head No. 32—R30,000) flows from an increase in the rate of interest on loan capital.

Of the amount of R1,849,000 required under Head No. 17—Miscellaneous Expenditure—R1,265,000 is required as a special contribution to the Benevolent Fund to cover expenditure caused by the increase of the temporary allowance to certain groups of Railway pensioners. In the original Estimates provision was made for a nominal amount of R2,000 in respect of losses on the realization of investments; an additional amount of R248,000 is required to cover the nett capital loss on the sale of locally registered securities with a low interest return. The nett return was reinvested in more profitable securities and the loss in question will be cancelled out within several months.

Because a larger number of assets than anticipated—mainly rolling stock—is being withdrawn from service, an additional amount of R250,000 has to be voted for that purpose.

Harbours

The total additional amount required under the Head Harbours, excepting Nett Revenue Account, amounts to R1,200,000 of which amount nearly R500,000 relates to salary and wage concessions.

The increase of approximately R500,000 under Head No. 18—Maintenance of Assets—is mainly attributable to dredging at Walvis Bay and Table Bay harbours; maintenance costs of cranes are also higher.

Operating Expenses—Head No. 19—increased by R700,000 partly as a result of additional staff to handle the increasing harbour traffic, and increased expenditure in respect of Sunday time and overtime payments.

An amount of R57,562 under Head No. 25 —Miscellaneous Expenditure—is required for the writing-off of certain buildings situate in the ship-repairing yard at Durban.

Airways

As regards Transportation Services—Head No. 28—under Airways, the increase of R624,000 is mainly attributable to more commission payments to agents due to increased traffic, increased air station and traffic costs, as well as expenditure in respect of overseas offices.

In the case of Miscellaneous Expenditure— Head No. 30—an increase of R100,000 is anticipated. This includes, inter alia, compensation payable by the South African Airways to the Central African Airways in terms of a pool agreement in respect of regional traffic handled by the Springbok Pool partners.

Pipeline

As regards the exploitation of the pipeline, an amount of R51,000 is required under Head No. 31, partly for office expenses, insurance premiums and costs payable to staff trained overseas.

So much about expenditure which has to be defrayed from Revenue Funds.

At this stage it is not practical to furnish details in connection with working results; that will be done at a later stage during the year when the Main Estimates are submitted to Parliament for consideration.

As regards Capital and Betterment Works,it is necessary to vote an amount of R8,053,500 for the current financial year; it will be possible to finance that mainly from savings under the existing appropriation; consequently only R200,000 is requested from Loan Funds.

From the documents which have been tabled, it will be noted that there are various items in respect of which only a nominal cash provision has been made; these represent works of an urgent nature, which cannot be postponed until a later stage during the year when the Main Estimates will be submitted. The three new railway lines in respect of which legislation has been introduced, also fall into this category.

An amount of R2,046,700 is required under Head No. 2—New Works on Open Lines,more than half of this amount, namely R1,174,000 has to be voted in terms of resolutions of the Select Committee on Railways and Harbours in respect of belated debits each against a particular item of more than R10,000.

I shall proceed to deal with a few of the more important items which have been included.

The facilities for the handling of coal, anthracite and coke on the Vryheid—Hlobane section are fast becoming inadequate, and in order to cope with the situation, it has been decided to provide a traffic yard with eight railway lines at a cost of approximately R500,000 between Boomlaer and Hlobane; a new marshalling yard which will cost nearly R2,000,000 will be constructed at Sikame, near Vryheid, which is going to be the junction for the proposed railway line to Empangeni.

The carrying capacity of the narrow gauge line between Esperanza and Donnybrook has to be improved in order to be able to cope properly with the increasing sugar cane traffic. A total amount of R352,000 is voted for that purpose.

Improvements which will cost more than R4,000,000, are going to be effected on the Hoedspruit—Metsi section as a result of the increase in the Phalaborwa traffic and as a result of the necessity of improving this section to the same standard as that of the proposed railway line bordering on the Kruger National Park.

As there are indications that the volume of traffic on the Natal Main Line will increase in spite of the pipeline, it has become necessary to improve the carrying capacity of the Durban—Danskraal section even more, through the subdivision of sections by means of coloured-light signals and the introduction of centralized traffic control between Ladysmith and Durban which will cost more than R3,500,000.

In order to combat the shortage of staff, especially trainee firemen, firemen and shunters, on the Natal and Eastern and Western Transvaal systems, candidates are recruited on the Cape Western and Cape Midlands systems to be trained for subsequent transfer. Consequently, it is necessary to provide additional accommodation at the Louw Geldenhuys, Langlaagte and J. W. Sauer, Germiston, hostels at a cost of R136,000.

Similarly, amounts of R125,000 and R100,000 are required for additional accommodation at the hostels at Empangeni and Koedoespoort to provide sufficient accommodation to staff at these places.

The electrification of the section between Kamfersdam and Postmasburg will now be completed at an earlier date than was initially anticipated, and as it is essential that this railway line should be electrified all the way to Hotazel, provision is now being made for that.

The major portion of the appropriation of R137,200 under Head No. 3—Rolling Stock—is in connection with belated debits as well.

The extremely hard rock formations in the entrance channel at Table Bay Harbour resulted in more time having to be spent on dredging done in connection with the construction of the tanker berth, for which provision has been made in the Brown Book, and consequently increased expenditure had to be incurred. An additional cash provision of R2,300.000 is consequently voted for that purpose under Head No. 5—Harbours.

As a result of the anticipated expansion of the internal and regional services of the South African Airways, and in order to facilitate the withdrawal of aircraft for servicing and maintenance purposes, it has been decided to purchase two additional Boeing 727 aircraft and provision for this is made under Head No. 6— Airways.

An amount of R2,500,000 is required under Head No. 7—Pipeline. During the past financial year this work progressed at a slower rate than anticipated, and the leeway was made up during the current year.

On account of the restrictions imposed by building societies on the granting of loans, a saving is anticipated against the existing item in the Brown Book in respect of the Assisted House Ownership or 10 per cent Scheme; consequently an amount of R330,000 is transferred under Head No. 8—Working Capital—to the House Ownership Scheme item in order to enable the granting of an additional number of loans to the staff under this scheme.

As a result of the increase in the Department’s assets it has been found necessary to make provision for additional funds amounting to R2,000,000 in respect of working stock for the financial year 1966-7. As the Estimates of Expenditure on Capital and Betterment Works for the year ending 31 March 1967, will only be submitted to Parliament at a later stage during this year, it is essential to make provision in the Additional Estimates in the meantime for an amount of R1,000,000 in respect of spare parts for Boeing aircraft, diesel locomotives, electric locomotives and motor coaches.

The Minister, in introducing this motion, has given us a somewhat longer explanation of the various items affected on both Capital and Loan Account as well as Revenue Account than has been his practice in former years. I want to tell the Minister that whilst we appreciate the diligence he has displayed in giving us an explanation of these various items at some length, I am afraid we will have to come back to them when the various Heads are put in the Committee Stage because I am sure the Minister will appreciate that it is rather difficult to absorb in toto all the various explanations for the various amounts of expenditure, even though one may have done one’s homework on the various estimates. I say that right at the beginning so that the Minister will know in advance that we are going to seek further information on certain of these items.

There are, however, one or two general observations that one can make at this stage. First of all, in respect of Revenue Account the Minister has indicated that of the R35,000,000-odd that we are being asked to vote here some R16,500,000 is being devoted to the salary increases that will take effect as from 1 October last year. Sir, the total amount is R35,000,000. I have tried to do a bit of an analysis of the various Heads to try to find out precisely what portion of the money that we are now voting represents an increase in the wages and salaries of railwaymen and what in fact is the amount of overtime and Sundaytime, etc. On a rough assessment—I do not say that this is correct—one finds that of the R35,000,000 approximately R10,000,000 represents Railway requirements other than wage and salary increases. The Minister has indicated that some R16,000,000 represents wage increases, leaving a balance of R4,000,000 to R4,500,000. Are we correct in assuming that this remaining amount represents the amount that is being paid to railwaymen for overtime and Sunday-time in order to keep the wheels of the Railways going? If that is so, it is a rather large amount, because it means that over a period of 12 months something like R8,00,000 is paid to railwaymen for overtime and Sunday-time. Sir, I know that you would rule me out of order if I tried to go too far into the implications of this as far as Railway personnel are concerned, but at this stage I would like to indicate to the Minister that when we come to the Part Appropriation Debate, this is a matter that we will take very much further because in our view the amount of Sunday-time and overtime worked seriously affects the efficiency of the railwaymen and the difficulty which they are experiencing at present in keeping the wheels of the Railways turning.

Then turning to Accounts we on these benches are very pleased to see that at long last the Minister has come to heed our advice as far as these Additional Estimates are concerned. I want to say that I am particularly pleased to note that the Minister has taken our advice that the practice should have ceased long ago of including in these Additional Estimates new items which should normally appear in the Brown Book. These Additional Estimates still include a number of new items under “New Works and Open Lines”; there are no new items under “Rolling Stock”, as has been the practice for years and years, and I must congratulate the Minister on having accepted our advice in this regard. As I have said, there are still a number of new items under “New Works and Open Lines” and I therefore want to make a plea to the hon. the Minister once again. There is a big improvement this year and in these circumstances it is difficult to put forward a plea to the Minister, because one has grave doubts as to whether the Minister will still be here after the election …

Where do you think I will be; do you think I will lose my seat?

No, I do not know whether the Minister will lose his seat; that is also a possibility but I doubt whether he will be Minister of Railways. There will be an entirely new Government and the Minister will obviously be replaced.

I never thought of that.

It is strange how smug some people can become.

I certainly hope that the Minister is not getting any ideas that he holds his present position with any degree of permanence because I can assure him that he will not be there permanently. As I have said there are still a number of new items here; I do not want to list them now; I will raise this matter again when we come to deal with the various Heads, but as a matter of general principle it is very difficult, when these items appear on Additional Estimates of this nature, to conduct anything like an objective discussion as far as the planning of Railway operations is concerned. I hope that when the next Additional Estimates are introduced we will see a further improvement and that no new items will be included at all.

The hon. the Minister has indicated that a number of items are included under Head No. 2 in respect of delayed debits which have been brought to account, directly as a result of the recommendations of the Select Committee on Railways and Harbours. This is a matter which, as the hon. the Minister knows, has been the subject of consideration by the Select Committee for quite a number of years.

Then there is just one other item to which I want to refer because I want to indicate to the Minister that when we come to the Committee Stage we will move certain amendments. You, Sir, would not permit me at this stage to carry this matter very far. I refer to an item under Revenue Account, Head 1, where there is a footnote to which the Minister made no reference at all in his address, a footnote to the effect that Account No. 201, “Salaries and Wages” includes the increased emoluments of Railway Commissioners with effect from 1 October 1965, the Senior Commissioner receiving R8,100 per annum and the two Junior Commissioners R7,700 per annum. In other words, an increase of R500 per annum is being offered to each of the three Railway Commissioners with effect from 1 October, 1965. The Senior Commissioner gets the same increase as the Junior Commissioners. I want to indicate immediately to the hon. the Minister that when we come to the Committee Stage we will move an amendment to rectify the position, but at this stage I want to outline very briefly the situation as far as Railway Commissioners are concerned. A salary of R8,100 for the Senior Commissioner represents an increase of nearly 25 per cent over the salary which he received in 1956. In other words, in a period of slightly less than ten years the Senior Railway Commissioner has received increases totalling 22.3 per cent. As far as the other two Commissioners are concerned, their salaries have been increased by something like 15 per cent, and since 1955 they have received an overall flat increase of roughly 20 per cent. I wonder how many railwaymen have received the same percentage increase in their salaries over the same period.

The same percentage, and in some cases more.

The Minister says that they have received the same percentage increase, but there is a vast difference between a servant of the Administration, even one occupying a senior executive position, and a Railway Commissioner. The difference is this that the servant of the Administration is a career railwayman; he spends his life in the service of the Railways, but who is a Railway Commissioner? He is a politician who is given a job on a temporary basis, and the percentage increase in the emoluments of Railway Commissioners is far greater than the percentage increase given to any Railway executive officer. In addition to that, no Railway officer receives the other perquisites which the Railway Commissioner receives. He does not receive a free motor-car; he does not get a gold badge; he does not get a free railway coach; he does not receive an entertainment allowance or any of the other “perks” attached to the position of Railway Commissioner. But there is another aspect of the increase which is being granted here to Railway Commissioners. Railway servants had their last increase in 1962 with the rationalization of wage and salary scales; this is the first increase they have had since then, but this is the second increase given to Railway Commissioners in the same period of time. There has been no increase in the pay of railwaymen since 1962, but this is the second increase which has been given to the Railway Commissioners in a period of four years. I put it to the hon. the.MINISTER What justification is there for what is being done here? When the last increase was announced for Railway Commissioners the Minister stated that the reason was that the Government had appointed a commission to investigate the whole question of the salaries paid to members of statutory boards and the increase granted to Railway Commissioners at that time was in order to bring their salaries in line with those of members of statutory boards. Sir, I am not aware of any increases recently granted to the members of statutory boards. Why should the Railway Commissioners be given an increase? They carry no executive responsibility as in the case of the members of other statutory bodies. I put it to the Minister at this stage so that we can ascertain the reason for the salary increases granted to officers appointed to the Railway Board because of their political affiliations, not because of service to the Railways over a long period of time. I want to stress that the increases which are being given here to the Commissioners bear no resemblance to the increases granted recently to Railway servants. Furthermore I would like to point out to the Minister that when the last increase was given to railwaymen, Railway Commissioners were not given a commensurate increase. I therefore ask the Minister, on behalf of this side of the House, to give us a full explanation for what has been done under this particular item under this head.

I think the question of wage increases can be discussed much better under the Part Appropriation Bill. All I want to say at this stage is that in saying that of the R35,000,000, R16,000,000 represents increases in wages to railwaymen, that, of course, includes everything. That is the cost to the Administration. That amount covers wage increases, over-time payments which are increases as a result of wage increases, bonus-time payments, Sunday-time payments and Superannuation Fund additional contributions. The amount that is always mentioned is the amount that it actually costs the Administration to cover the increases. The increases differ from grade to grade.

The R16,000,000 that you mentioned, does that include everything, including Sunday-time and over-time?

That is the cost to the Administration of the wage increases for this particular financial year.

What is the actual cost of the wage increases themselves?

That information I can give the House under the Part Appropriation Bill.

With regard to the new items in the Additional Estimates that is a matter that we have argued so often over the years that I do not think there is any sense in arguing it again. The hon. member knows what my standpoint is. I think there is nothing wrong in including new items in the Additional Estimates, and I have explained the reasons over and over again. The hon. member knows that repetition is tedious and I do not want to be tedious.

I come then to the increase of R500 in the salaries of the Railway Commissioners. I think that increase is fully justified. I think as a matter of fact that the Railway Commissioners, in relation to the members of statutory boards and standing committees, have a leeway to make up as far as their salaries are concerned. A Railway Commissioner fulfils a very important function. Not only do Railway Commissioners deal with all appeals from members of the staff but they have to make recommendations in regard to the building of new railway lines, and in addition to that they are the Minister’s advisers. They do extremely important work and they do a great deal of work. Whether they were politicians formerly or not makes no earthly difference. I think even the hon. member for Turffontein (Mr. Durrant) might make a passable Railway Commissioner if he ever has the opportunity of becoming one. In regard to this particular salary increase I can only say that the staff as a whole is receiving increases. Some of my senior officers will receive more than R500 per annum; some will receive less. All the increases are based mainly on job evaluation, and on merit. And if I had to base the salary increases of Railway Commissioners strictly on merit then they should have received more than R500. But I had to keep their salaries at a level comparable to those paid to members of other statutory boards. The hon. member is quite right when he says that they have not received increases, but the matter is before the Cabinet now. Members of statutory boards will be receiving increases. When those new salaries are published, hon. members will see that the salaries paid to the Railway Commissioners are more or less comparable with—and in many cases the same as —those paid to members of other statutory boards. I feel the Commissioners fully deserve their salaries. As a matter of fact, if they were paid on a merit basis they would be receiving even higher salaries.

Motion put and agreed to.

House in Committee:

Estimates of Additional Expenditure from Railways and Harbours Revenue Funds

On Head No. 1—"General Charges—Railways", R1,058,000,

I wish to move the following amendment to Head No. 1—

I move this amendment because we on this side of the House raise a fundamental objection to the increase that is here being granted to Railway Commissioners. The amount of R750 is made up of the R250 extra which each Commissioner will get from 1 October, 1965.

I do not wish to repeat the arguments advanced by me a few minutes ago when the motion to go into committee was before the House. The hon. the Minister bases his justification for the increases granted to Railway Commissioners on two grounds. In the first instance he says they are perfectly justified, being based on the principle of job evaluation. Viewing the matter from the point of view of job evaluation, I want to ask the hon. the Minister how the increases compare to those received by the assistant general managers, of whom there are several on the Railways, men who carry a very heavy executive responsibility. I do not think the hon. the Minister will evaluate the executive responsibility of the assistant general managers and others on the Railways as being comparable to that of Railway Commissioners, because the functions of the latter are strictly limited. They act in an advisory capacity to the Minister, they have to deliberate on appeals received, and they carry out certain investigations connected with the construction of new railway lines.

We on this side of the House have for a long time put up a case for greater executive responsibility for Railway Commissioners. We have asked for a new approach to their duties. But until that happens, Mr. Chairman, we fail to see that the Commissioners are entitled to an increase on a basis of job evaluation, as the Minister has put it, when the functions of railway commissioners are clearly laid down in the Act. The Act prescribes what their functions are and what they must do.

But there is another aspect of this matter of job evaluation I want to refer to. The hon. the Minister has said the increases are justified, and therefore I raise the point again. I am referring, Sir, to the fact that a Railway Commissioner is not appointed to his post in a permanent capacity. In fact, if I remember correctly, he gets paid a bonus after his term of office has expired and he is not re-appointed by the Government. I think he receives a bonus of 7 per cent of his gross income for the period he served as compensation. There is certainly no question of job evaluation as regards a Railway Commissioner having served the Railways for a long number of years.

The hon. the Minister also justified the increases by stating that he wanted to bring the salaries of Railway Commissioners more in line with those paid to members of other Government statutory bodies. I want to remind the Minister that in 1964 and 1962 he gave exactly the same reason. At the time he said the idea was to bring the salaries of Railway Commissioners in line with the salaries paid to members of other statutory bodies. Well, many chairmen and members of other bodies carry a certain executive responsibility not borne by a Railway Commissioner.

Which?

Let us take the case of the Chairman of the Public Service Commission. He is a career civil servant. He sits on a body …

I was not referring to that.

Well, Sir, I am trying to draw a parallel. The hon. the Minister has referred to boards, to commissions and other similar bodies. Therefore I am also referring to a statutory body. I should like to say to the hon. the Minister that if he refers to his Hansard speeches of 1962 he will see that he himself, when justifying increases granted to Railway Commissioners at that time, drew a parallel with the incomes of and salaries paid to the Chairman and members of the Public Service Commission. He himself used the same parallel at that time.

They get R9.000. They used to get less than a Railway Commissioner.

I am trying to indicate to the hon. the Minister, Mr. Chairman, that there should be a difference in approach to a man serving the Government on a permanent basis to that of a man given a temporary appointment. Because a Railway Commissionership is nothing but a temporary appointment, it is a perk granted on a political basis, if I may put it as bluntly as that. This side of the House feel there is no justification for the increase to the Railway Commissioners. I say there is no justification because if there were any merit in the increases granted to them, then sight must not be lost of the fact that they were granted increases two years ago, or even less than two years ago. Over the same period no parallel can be drawn between increases granted to ordinary railwaymen and those granted to Railway Commissioners. I therefore move.

One aspect of the proposed increases to Railway Commissioners arises out of the hon. the Minister’s reply at an earlier stage when he said these increases have been brought about as a result of job evaluation and merit. Well, we on this side were under the impression that all of the increases that have been granted to railway personnel were due to the unprecedented increase in the cost of living.

No, that is not so.

Now I understand from the Minister that that fact had nothing whatsoever to do with railwaymen’s increases.

If I had to base the increases on the cost of living, railwaymen would have received much less than they did in fact receive.

The hon. the Minister now says that if he had based the increases on the increased cost of living the increases would have been rather less. I do not think the relevant figures justify the Minister making that remark.

The staff organizations know that is so. I discussed the matter with them.

I think this aspect will be discussed further when we debate the Part Appropriation Bill. The information that I have does not bear that out at all. But I am prepared to be convinced that the hon. the Minister is correct.

I wish to compare the proposed increases for Railway Commissioners with the increase now received by the Chairman of the Public Service Commission. It will be remembered that that was the basis for the increase granted the last time. It was contended at the time that Railway Commissioners should be brought to the same level as Public Service Commissioners and members serving on other bodies of a similar nature. The Chairman of the Public Service Commission is now in receipt of R9,000 per annum.

No, he gets more than that. The other members get R9,000.

What yardstick should we use when considering increases for Railway Commissioners? Should we use job evaluation as a basis, or should we refer to salaries paid to members of other statutory bodies? The reason for the last increase to Railway Commissioners was that they were receiving so much less than Commissioners in the Public Service. The increase granted to them now is less than that being granted to the members of the Public Service Commission. And yet job evaluation is now being mentioned as justifying the increase.

I said, if the hon. member will recollect, that if job evaluation had been applied to Railway Commissioners, they would have received much more than a R500 increase.

That is so, but the hon. the Minister also said that job evaluation was the reason for the present increase.

That is what I said.

I feel that in fairness to the Railway Commissioners we should get this matter put right.

I said that the increases granted to the railway staff were based on job evaluation. In other words, on merit. If I had also applied job evaluation on the same basis to the Railway Commissioners. they would have received much more than R500 because they fulfil important functions. I also said that one of the reasons why they have received this amount is to bring them in line with increases granted to members of other statutory bodies. I hope the position is now clear.

So we are now to understand that job evaluation was not the yardstick for the increases but the desire to bring them in line with the increases granted to Public Service Commissioners.

No, 1 was not speaking about them, but about statutory boards. That is something quite different. I was thinking of the Board of Trade, the Wage Board, the Industrial Tribunal, and all those boards. The members of those boards are also employed on a part-time basis.

That is why I say, Mr. Chairman, if the hon. the Minister had said that initially, namely that the increases were motivated by the desire to bring the Railway Commissioners in line with the increases granted to members of statutory boards, then I would not have raised the matter of job evaluation. I think the Railway Commissioners, and the public, should know that the salaries of the Commissioners are now based on and linked with those paid to members of statutory boards.

It has always been so.

No, it has not always been so. Because on the last occasion Railway Commissioners received increases the hon. The Minister stressed that they had been receiving rather less than members of other boards for many, many years. An effort is once more being made to bring them in line, but it would appear that already they are beginning to receive less than their counter-parts on other boards.

Be that as it may, Mr. Chairman, I wish to state that I support the amendment proposed by the hon. member, because I think it is wrong in principle that increases should be paid to Railway Commissioners if one bears in mind that their position should be completely divorced from that of the railway staff. They cannot be considered to be part and parcel of the railway staff. For they are virtually in the same position as others who occupy positions of high authority in other Government Departments. I therefore think it is wrong to link them up with the staff in this way.

The hon. the Minister may argue that this is the only way in which it can be done. But I think it is wrong. I think the Railway Commissioners should be placed in the same position as the other groups the Minister has mentioned. Then we will know that they are automatically linked with statutory bodies, because they occupy positions analogous to those occupied by members of a statutory body. I for one fail to see why Railway Commissioners should always be brought into the picture when salary adjustments for railwaymen are made, whether such adjustments are caused by increased cost of living or job evaluation. It does not seem right to me. It means that they get the benefit of negotiations that take place between the staff associations and the Minister. And yet they sit in on those discussions as advisers to the Minister. I think in principle it is all wrong. I think the hon. Minister, if he goes into the matter a little deeper, will agree that it would be wrong for him to receive salary increases each and every time he granted increases to railway staff. That, Sir, is the basis of my objection to this procedure. I say it is wrong that every time railway staff are granted increases, the Railway Commissioners who sit in on the discussions and take part in them should also derive benefit therefrom.

I find it very strange that the Opposition are now objecting to this increase, because two years ago they apparently succeeded in reconciling it with their consciences and made no objection to an increase for Railway Commissioners. If the Opposition are now objecting on the ground that the increase is out of proportion to that received by the staff, then I want to point out to them that the average wage and salary increase of the staff was 12f per cent, whereas the increase for the senior Commissioner was only 6.6 per cent, and that of the other two commissioners only 6.9 per cent.

It should be borne in mind, Mr. Chairman, that the work and the responsibility of the Railway Commissioners have increased considerably with the tremendous expansion of the Railways over the years. In 1910 the salary of a Railway Commissioner was R4,000, in the next 55 years it was more or less doubled in the case of the Senior Commissioner, and in the case of the other two Commissioners it was not even doubled. The increase amounts to between 90 per cent and 102 per cent. On the other hand, if one looks at the capital investments of the S.A.R., one finds that it was R178,000,000 in 1910, and approximately R1,900,000,000 in 1965. That represents an increase of 967 per cent. Now let us look at the expenditure on Revenue Account. In 1910 the amount was R25,000,000, whereas in 1965 it had risen to R598,000,000. Here we find an increase of almost 2,300 per cent. Surely it will be realized that the responsibility of the Railway Commissioners has also increased tremendously.

But as the hon. the Minister said quite rightly, a large portion of the Commissioners’ work consists of staff matters. They are the highest body to which appeals can be submitted.

And what has happened in the case of the Railway staff? In 1910 the staff totalled 52,483. In 1965 it was 225,733. The staff therefore increased by between 300 per cent and 400 per cent.

Now let us see what other senior officials received in 1910. As I have said, Railway Commissioners received R4,000 per annum at that time. Well, Secretaries of Departments received only R3,000 per year at that time. Railway Commissioners were therefore paid R1,000 more than the heads of Government Departments. For many years they were remunerated at this higher scale. In due course, however, they fell behind the heads of Departments, and in 1961 this position was again corrected when Railway Commissioners and Heads of Departments were paid the same salary, namely R6,800. And what is the position to-day? A Head of Department receives R9,000. It therefore appears that even after this increase of R500, the Senior Railway Commissioner will still receive R900 less than the head of a Government Department.

But does he bear the same responsibility?

Well, Mr. Chairman, the fathers of our old Constitution of 1910—the same Constitution about which hon. members on that saide have always had so much to say and have held in such high esteem—thought it proper to give the Railway Commissioners R1.000 per year more than Heads of Departments. I wholeheartedly agree with the hon. the Minister that these increases for the Railway Commissioners are fully justified. As I have said, I find it strange that the Opposition did not oppose the increases for the Commissioners two years ago.

We did.

No, Four years ago the Opposition objected. I remember very well how the hon. member for Turffontein met the Commissioners outside the House two years ago and told them that they must have been most surprised at the Opposition’s attitude, since they had expected that their increases would be objected to. It was four years ago that the Opposition objected. But, Mr. Chairman, two years ago there was no election in the offing. Now there is an election in the offing and now that side is trying to make political capital out of the matter. I cannot quite understand the attitude of the hon. members on that side, because surely the same argument which applied four years ago still apply to-day. The same objections they raised to-day they could also have raised in 1963 when the Commissioners were given increases. Then they voted in favour of the increases. But now they do not vote in favour of them, because they want to impress the electorate. They want to stir up dissatisfaction among the Railway officials. That is why they are now opposing these increases. There is no getting away from that. It is simply a fact. Because there is nothing else that can be used to stir up dissatisfaction amongst the railwaymen— because they have received large increases— the Opposition is seizing upon this matter and is trying to lead the officials to believe that the Railway Commissioners are receiving much larger increases than they have received. That is the whole reason for their attitude, and that is why the amendment which has been moved here should be seen as a political manoeuvre on the part of the Opposition. That is why I trust that it will be rejected by the Committee.

If the hon. member for Bloemfontein (East) (Mr. van Rensburg) wishes to allege that this side have raised this matter merely in order to make some political capital and to arouse discontent amongst railway servants, then he may do so. But I wish to point out, Sir, that we have not raised this matter for that purpose. Because railwaymen are already dissatisfied and concerned at what is being done. It is not necessary for us to expose these matters. Railwaymen are already aware of these things. They are already discontented. The hon. member must not come here and make silly observations about what was said and what was not said in 1964 when the last increase was granted. The hon. member for Bloemfontein (East) has the status of a front-bencher now in the Nationalist Party. He should therefore not adopt the tactics of a back-bencher. He should act in a responsible manner. Because when the hon. member referred to the salaries of commissioners in 1910 and 1912, he was repeating almost word for word the speech made by the hon. the Minister when he attempted to justify the increases of 1964. While the hon. member was speaking I was looking at the Minister’s speech as recorded in Hansard. He made use of the argument that in 1910 the commissioners received more than the heads of departments and the chairmen and heads of other statutory bodies. But why did the hon. member omit the pertinent part of the Minister’s observations? The hon. the Minister used exactly the same argument, but he also used these words, after an interjection had been made—

In other words, the hon. the Minister made the point very clearly that prior to 1912 railway commissioners had a different and more responsible function in the railway administration than they have in terms of the existing Act to-day. Why did the hon. member for Bloemfontein (East) not quote those words? Why did he merely quote the arguments used by the hon. the Minister in 1964?

It has been alleged that I did not raise any objection when the last increases were made. That is not so. I raised the strongest objections at that time. But in the end I accepted the Minister’s explanation and did not press an amendment. And I did not press an amendment because the argument of the hon. the Minister in 1964 was this—and it is clearly revealed in Hansard. He said that the railwaymen got their rationalization and increases in 1962 but nothing was done for the railway commissioners at that time. The railway commissioners were prejudiced because the railwaymen had received increases but the commissioners had received nothing. So the hon. the Minister came along and said that on that basis and because of their heavy responsibilities the increases for the commissioners were justified. And on those grounds I did not press my amendment at that time.

Now, why has the hon. member for Bloemfontein (East) attempted to set out a completely erroneous position? It is because he finds himself in considerable difficulty over this matter. Because, Sir, he knows what railwaymen are saying in Bloemfontein. He knows of the dissatisfaction that has been expressed. And I now challenge the hon. member for Bloemfontein (East) to show me one percentage increase granted to any single railwayman under these new increases equivalent to what the railway commissioners are getting. I am referring to the men who make the wheels turn. I have in mind any member of the running staff; any member of the administrative staff, excluding the higher echelons because there may be a parallel in one or two cases. I have in mind the ordinary fellows in the railways, the chaps who take their jackets off and get down to the work. Can the hon. member do it? Of course he cannot. Because there is no parallel between the vast percentage increase being given to railway commissioners and the increases given to railwaymen, including those in executive positions. Is it fair, Sir, that a commissioner’s salary should increase by no less than R2,700 in a period of eight or nine years? Is there any comparison with the increases received by the ordinary men, amongst the railworkers, amongst the artisan staff, amongst the guards and shunters and engine drivers?

Let the hon. member draw a satisfactory comparison or parallel and I will get up in this House and apologize. Because, Sir, there is no comparison to be drawn whatsoever.

Is it any wonder then that railwaymen outside, the ordinary men, are saying that this Government has forgotten them and that they only receive their increases by way of a charitable donation? And then the job evaluation is not always what it should be. But look at the politicians who are placed in high posts by this Government. They get the big increases. They live off the fat of the land. They get the motor cars, the gold badges, the entertainment allowances and all the other perks that go with the political appointments they hold by virtue of an appointment by this Government. I say to the hon. member for Bloemfontein (East) that I am prepared to face him on any platform outside and to ask him to justify these increases granted to politicians appointed to the position of railway commissioner in the railway service, compared to what the ordinary railwaymen have received. And that, Sir, will be the test in the coming election!

All this, Mr. Chairman, is not going to help hon. members one bit in the election. It has been such a waste of breath. They are now the champion of the poor railwaymen. They have been trying for the last 18 years, and they have not been successful yet. As a matter of fact, with every election they lose more and more railway votes.

You will be surprised this time.

The hon. member for Drakensberg (Mrs. S. M. van Niekerk) is going to lose her seat because the railwaymen are not going to vote for her.

Is that so?

As I was saying, this has all been a waste of breath. We hear all this lightning and thunder every year. And for what purpose? Not one railwayman is going to vote for the United Party or for the hon. member for Turffontein (Mr. Durrant) whose seat is also in danger because of the increase in the salaries of the Railway Commissioners.

No, there is no danger there.

The hon. member has become the champion of the railwaymen and opposes the increases for the railway commissioners. I say again: Such a waste of breath.

Mr. Chairman, I cannot understand why hon. members on that side are so antagonistic to the commissioners. I wonder if we would have had the same opposition to wage increases if the commissioners were former United Party politicians? I do not think so. Apart from that, the fact remains that the three railway commissioners are not all former Nationalist politicians, as the hon. member implied. The senior commissioner was appointed originally by the United Party in 1937, I think, as Chairman of the Wage Board. I reappointed him in that post when I became Minister of Labour. And after that, because he was such a highly competent man, an exceptionally competent man, a man with great ability, my predecessor appointed him as a railway commissioner. I do not know why he should be labelled as a former Nationalist politician who is receiving an increase in wages. I think the hon. member owes him an apology. But even during the time when there was a United Party Government, politicians were appointed as railway commissioners.

Would you describe the position of the other two commissioners? Where do they emanate from?

They were former members of Parliament for the Nationalist Party. The hon. member, however, referred to all commissioners. That is why I said he owed Dr. Botha an apology. But as I have said, I do not know why hon. members are so antagonistic towards railway commissioners and why they object so strongly to any wage increase for them. In all these years I have never had one complaint from a member of the staff or from any staff association about increases granted to railway commissioners. As a matter of fact, the attitude of staff associations is that senior officers deserve larger salaries than those they do receive. This goes for the railway commissioners as well. These staff associations are more sensible than the hon. member for Turffontein because they understand the position, and realize what responsibilities these men have to carry. If the remuneration of railway commissioners were based on job evaluation, they would receive a much bigger increase than what they are getting.

The hon. member also challenged the hon. member for Bloemfontein (East) (Mr. Van Rensburg) to show that the poor, ordinary railway workman received a higher percentage increase than that of railway commissioners. Well, the hon. member will be interested to know that the increase which was granted to the ordinary railway workman averaged 11.5 per cent. I refer to the most recent increase which was granted them. The increase I have just given to railway commissioners averages 7 per cent. So the hon. member may take up that challenge if it is worth anything at all.

You should calculate the two increases granted to the commissioners.

I have done so. The position remains the same. You see, Sir, just how much worth there is in the arguments of the hon. member. I wonder why they are so antagonistic towards the railway commissioners. They do not know what work they do, and they do not know what their responsibilities are. They do not realize what an important position these commissioners occupy in the whole structure of the railways. Of these things hon. members know nothing. But, of course, here they see the opportunity of reaping the vote of one dissatisfied railwayman. They are saying to the railway workmen: “Look at the tremendous increases these commissioners receive whilst you do not receive a comparable increase.” Hon. members also referred to the cost of living. I said by way of interjection that these increases were not based on the increase in the cost of living only. This was accepted by all the staff associations. At the time I was negotiating with the staff associations last year, the cost-of-living index, according to the official index, had increased by 8.5 per cent over that of 1962, i.e. the year when there was last an increase in wages. The holiday bonus granted to the staff at the end of 1964 amounted on an average to 3.7 per cent of their wages, leaving an actual nett rise in the cost of living of 4.8 per cent, while the increases they got averaged 11.5 per cent.

I do not think there is anything more for me to say. This is the type of debate we have had on every occasion when an increase was granted to commissioners. The same arguments are used over and over again even at the risk of a debate becoming tedious.

I hope the hon. the Minister will allow me to make one point very clear. I challenged the hon. member for Bloemfontein (East) earlier on, and I still stand by it, to show that it is incorrect for me to state that whereas Railway Commissioners have had two increases in wages since 1962 the ordinary railway workmen received only one. Consequently there is no comparison between the percentage increase in each case.

Amendment put and the Committee divided:

AYES—38: Basson, J. A. L.: Basson, J. D. du P.; Cadman, R. M.; Connan, J. M.; Dodds, P. R.; Durrant, R. B.; Eden, G. S.; Emdin, S.; Field, A. N.; Fisher, E. L.; Gay, L. C.; Gorshel, A.; Graaff, de V.; Hickman, T.; Hourquebie, R. G. L.; Lewis, H.; Miller, H.; Mitchell, D. E.; Mitchell,M.L.; Moore, P. A.; Oldfield, G. N.; Plewman, R. P.; Radford. A.; Raw. W. V.; Steenkamp, L. S.; Steyn, S. J. M.; Streicher, D. M.; Taurog, L. B.; Taylor, C. D.; Thompson, J. O. N.; Timoney, H. M.; Tucker, H.; van Niekerk, S. M.; Warren, C. M.; Weiss, U. M.; Wood, L. F.

Tellers: N. G. Eaton and T. G. Hughes.

NOES—70: Bekker, G. F. H.; Bekker, M. J. H.; Bezuidenhout, G. P. C.; Bootha. L. J. C.; Botha, M. C.; Botha, P. W.; Botha, S. P.; Cruywagen, W. A.; de Jager, P. R.; Diederichs, N.; du Plessis, H. R. H.; Frank, S.; Greyling, J. C.; Grobler, M. S. F.; Haak, J. F. W.; Henning, J. M.; Hertzog, A.; Heystek, J.; Knobel, G. J.; Kotze, G. P.; Kotzé, S. F.; le Roux, P. M. K.; Malan, W. C.; Marais, J. A.; Marais, P. S.; Maree, G. de K.; Maree, W. A.; Meyer, T.; Mostert, D. J. J.; Muller, H.; Niemand, F. J.; Odell, H. G. O.; Otto, J. C.; Pansegrouw, J. S.; Potgieter, J. E.; Rail, J. J.; Rail, J. W.; Sadie,N.C. van R.; Schlebusch, A. L.; Schlebusch, J. A.; Schoeman, B. J.; Schoeman, J. C. B.; Schoonbee, J. F.; Smit, H. H.; Steyn, J. H.; Swanepoel, J. W. F.; Swiegers, J. G.; Treurnicht, N. F.; Uys, D. C. H.; van den Berg, G. P.; van den Berg, M. J.; van den Heever, D. J. G.; van der Spuy, J. P.; van der Walt, B. J.; van der Wath, J. G. H.; van Eeden, F. J.; van Niekerk, M. C.; van Rensburg, M. C. G. J.; van Zyl, J. J. B.; Venter, M. J. de la R.; Verwoerd, H. F.; Viljoen, M.; Visse, J. H.; von Moltke, J. von S.; Vorster, B. J.; Vosloo, A. H.; Waring, F. W.; Wentzel, J. J.

Tellers: D. J. Potgieter and H. J. van Wyk.

Amendment accordingly negatived.

Head No. 1—“General Charges—Railways”, as printed, put and agreed to.