House of Assembly: Vol17 - WEDNESDAY 17 AUGUST 1966

WEDNESDAY, 17TH AUGUST, 1966 Prayers—2.20 p.m. COMMITTEES OF SUPPLY AND WAYS AND MEANS—CENTRAL GOVERNMENT (Motion to go into) The MINISTER OF FINANCE:

Mr. Speaker, I move—

That the House go into Committee of Supply on the Estimates of Expenditure to be defrayed from the Consolidated Revenue Fund during the year ending 31st March. 1967, and into Committee of Ways and Means on taxation proposals.

The dictionary defines “budget” as “the contents of a bag or bundle”. I do not think that is a good description. A budget should not be an amorphous collection of unrelated measures, loosely gathered together once a year to gladden or sadden the taxpayer. It should rather be a holistic conception, a coordinated fiscal plan with a clear objective, both short-term and long-term. The plan must, moreover, take account of the particular requirements of the economic situation.

The objectives which my fiscal plan will strive to promote can be summarized as follows:

First, to provide the necessary funds to enable South Africa to withstand any military or economic onslaught from any quarter;

Secondly, to finance, as far as our means allow, this expenditure in a non-inflationary manner, and to protect, in other respects too. the stability of the rand, thereby sparing South Africa the ravages of inflation;

Thirdly, to ensure the continued growth of the South African economy at the maximum rate consistent with our resources;

Fourthly, to assist those who in present conditions are finding it difficult to make ends meet, and particularly to mitigate for them the short-term effects of this plan, which in the long run will benefit them relatively more than other sections of the community.

The whole future of South Africa, in every respect that counts, depends on the continued realization of these objectives. This budget reflects this year’s instalment, in the light of current circumstances, to achieve our ideal.

The ingredients of a budget must clearly be selected with care, judiciously blended and suitably prepared, and the resulting fiscal confection should be served as attractively as possible with the appropriate garnishing. I hope to-day to present a budget which may not be to everybody’s taste, but which will nevertheless promote the necessary means to achieve the four objectives I have in mind.

In order to decide upon the appropriate bill of fare, the fiscal chef must first consider the present and prospective needs of the economy. In my speech on the Part Appropriation Bill last February I gave the House some account of financial and economic developments in South Africa up to the end of 1965. The White Paper which I shall table at the end of my speech contains more recent and more detailed information on economic developments. I shall, therefore, confine myself to a brief outline of the main economic trends of the past few months and to an assessment of the appropriate financial policy in the present situation. I shall start on this occasion with—

THE BALANCE OF PAYMENTS

No one would have dared to predict, a year ago, that our gold and foreign exchange reserves would to-day be at a level higher than that reached at any time in our history. This result was achieved largely through a substantial fall in imports, due in large part to the import control measures imposed last year by my colleague, the Minister of Economic Affairs, but to some extent also to the credit restriction imposed by the monetary authorities. Exports, particularly of manufactured goods, have on the other hand shown a modest but praiseworthy increase. The dramatic change in our balance of payments on current account, from a deficit of R123,000,000 during the second quarter of 1965 to a surplus of R26,000,000 during the corresponding period of 1966, was accompanied by an equally dramatic change in the balance on capital account. Here, after six successive years of capital outflow, the Republic in the 12 months ended 30th June, 1966, experienced a net capital inflow of no less than R270,000,000. Private capital accounted for R202,000,000. of which nearly half represented long-term funds. This remarkable inflow gave rise to some difficult internal economic problems to which I shall refer later, but it helped to swell the external reserves to a new month-end record of R612,000,000 at the end of July—a very satisfactory figure.

But as fluctuations in our balance of payments must occur from time to time, this level is by no means excessive and under normal conditions I should have preferred to set my sights even higher than this figure. Partly as a result of the relaxations in import control recently announced as an anti-inflationary measure, however, our imports are likely to show a rising tendency in the next few months, and the reserves may therefore decline appreciably unless this tendency is again counteracted by an inflow of foreign capital.

More difficult problems of policy are at present presented by—

THE INTERNAL ECONOMIC SITUATION

The problems, which I shall deal with presently, should not blind us to the remarkable progress of our economy. In fact, these problems stem from this progress, and are shared by other countries which have experienced a rapid rate of growth. The gross domestic product in real terms continued to increase steadily—despite the adverse effects of the drought—by five per cent in 1965 and, according to preliminary calculations, at roughly the same rate during the first half of 1966. An inc-ease at this rate, if continued, would mean that the real gross domestic product would double itself by 1980. The rate of five per cent is slightly below the Economic Development Programme’s target figure of 5½ per cent, but over the whole period of the programme since 1964 we are virtually still up to schedule.

Gross domestic expenditure, on the other hand, tended to level off, so that it actually fell below the gross national product during the first half of 1966, reflecting the moderate surplus on the current account of the balance of payments to which I have referred. This welcome result was, however, to a large extent attributed to a sharp decline in inventory investment brought about by the tightening of import control. Nevertheless, there would appear to have been some significant reduction in the rate of increase of the underlying monetary demand, partly as a result of the official disinflationary policy and partly owing to natural economic forces.

Private fixed investments, i.e. outlays on machinery, plant, equipment, building and construction, after increasing by 21 per cent in 1964-5, rose by only five per cent during the year ended June, 1966, and may even have declined somewhat during the course of the first half of 1966. Fixed investment by public corporations, although remaining at a high level, showed little if any further increase during 1965-6.

Taking into account the fact that the economy’s productive capacity must have been greatly expanded by the exceptionally high rate of fixed investment during the past three years, it is not surprising that the private investment boom has lately been showing signs of levelling off. In the present inflationary circumstances this development is to be welcomed. Indeed, every effort should still be made to postpone less essential capital projects for a while.

The other components of gross domestic expenditure. however, continued to rise strongly. Fixed capital outlays by public authorities in creased by R150,000,000 or 27 per cent during 1965-6, compared with 19 per cent during the previous year, while current expenditure by public authorities showed a rise of R126,000,000 or 14 per cent, compared with 11 per cent in 1964-5. In addition, private consumption, which had risen by 12 per cent in 1964-5, increased further by R345,000,000 or 7 per cent during the past year.

Total saving increased about 13 per cent during 1965-6, as against a mere 3 per cent during the previous year, and according to preliminary estimates this was mainly the result of a substantial recovery in personal saving, which had regrettably declined during the preceding twelve months.

Manufacturing again played a leading role in the maintenance of a high rate of growth. The seasonally adjusted index of the physical volume of manufacturing output tended to level off during the second half of 1965, but then increased substantially during the first half of 1966. During the past year as a whole it was about 5 per cent higher than during the previous year.

Activity in the building and construction industry appears to have declined in recent months from the record level reached last year. The value of building plans passed has dropped well below the level of early 1965 so that a somewhat lower level of activity seems likely for some time to come.

In agriculture, the picture is dominated by the effects of the drought of the past few years, which was only partially alleviated by the rains in the early part of this year. For most products, therefore, production during the past season was somewhat below normal. I am sure the House shares my hope that timely and abundant rains will next season bring relief to this hard-pressed section of our community. Since the demand for food products continued to be strong it was possible to assist farmers by raising producer’s prices for maize, wheat, dairy products and certain other commodities. The effect on consumer prices, however, was cushioned, in the case of maize and wheat, by higher Government subsidies. Such increases in consumer prices as could not be avoided have already been reflected in the consumer price index and further increases in controlled prices are unlikely in the near future. In particular, no increase in the price of bread is envisaged.

The value of gold production appears to be levelling out at a level of about R800,000,000 per annum, more than twice the figure of only ten years ago. The Government is continuing to assist certain marginal gold mines by means of loans and subsidies, but it is obviously of vital importance to the industry that inflation should be curbed and cost increases kept to a minimum.

Other economic indicators confirm the conclusion that, while the four-year-old economic upswing showed definite signs of levelling off after the middle of 1965, general economic activity remained at a very high level, and indeed a new potential upswing showed signs of developing in the first half of 1966.

Much has been said and written in recent months about the rising cost of living. The Government is certainly not complacent about this problem, as its actions have shown and will continue to show. But it is important to see the matter in its proper perspective. In fact, the seasonally adjusted consumer price index, as calculated by the Reserve Bank, increased by only 3.2 per cent between June, 1965, and June, 1966, as compared with 4.1 per cent during the preceding year, while the wholesale price index increased by 3.5 per cent during 1965-6, compared with 3.6 per cent during the previous twelve months. These rates are too high and are clearly harmful to the economy. But they do not lend support to the somewhat exaggerated references to inflation which have sometimes been heard.

The main evidence. for the disturbing continuance of a potentially inflationary situation is to be found in the—

MONETARY, BANKING AND FINANCIAL SITUATION

The credit extended by banks to the private sector showed a marked decline, as reflected in a decrease of R140,000,000 in the banks’ claims on the private sector over the 12 months ended June, 1966. This welcome development was mainly brought about by the restrictive monetary policy of the authorities, which culminated in the request by the Reserve Bank to the monetary banks in October, 1965, to restrict their credit to the private sector to the level which obtained at the end of March, 1965.

Unfortunately, the necessary and desirable contractionary influence of this decline in bank credit was offset by two factors. The first was a substantial increase in the Government’s net borrowing from the banking system, as reflected in an increase of R243,000,000 in the net claims of the banking sector on the Government sector in 1965-6. The Government was forced to finance a part of its expenditure in this way largely because of the unexpectedly small contribution made by the Public Debt Commissioners to loan funds. Attempts to fill the gap by obtaining additional long-term funds from the capital market met with only partial success.

Even so, the forces making for stability were exerting such a strong influence on the economy that the Economic Advisory Council was able to advise the Prime Minister, in February of this year, that “the various restrictive measures which the authorities have taken during the past year to restrain the pace of expansion to a level in accordance with the country’s available resources, have now become effective”.

The forces of monetary expansion were, however, reinforced by a second and unexpected factor to which I have already referred, namely the continued large inflow of capital from abroad. This inflow created further inflationary expectations which encouraged both capital and consumer spending. It also exerted a direct influence on the liquidity of the private sector.

The result of all these factors was that the quantity of money and near-money in the hands of the private sector rose by R310,000,000 or 14 per cent between June, 1965, and June, 1966. The inflationary potential lurking in this high level of liquidity is a danger which the Government cannot ignore.

The increased liquidity had its effect on the money market, where Treasury Bill and related interest rates declined during the first half of 1966. Conditions in the capital market, however, remained relatively tight and further upward pressure was exerted on interest rates on long-term gilt-edged and other fixed interest bearing securities.

This brings me to a brief discussion of—

MONETARY AND FISCAL POLICY

The economic problems which face South Africa at present are the problems of prosperity. They are problems associated with the rapid growth of a dynamic economy, and common to many other countries in the modern world.

The degree of price inflation in South Africa thus far, though unsatisfactory, has not yet become dangerous. But the potential inflationary danger residing in the excessive liquidity of the economy must be contained and, if possible, extinguished, otherwise it may get out of hand. If the anti-inflationary forces even seem to be losing ground inflation may begin to feed upon itself and once this stage is reached, the position becomes dangerous.

The Government is determined to prevent this. Since the end of 1964 the authorities have taken a number of steps to curb inflationary pressure and until quite recently these steps appeared, in the opinion of most expert observers, to be having the desired effect.

When, however, it became evident, towards the end of the second quarter of 1966, that these measures were not sufficient to counter the expansionary forces to which I referred earlier, the Government resolved to act. In a statement which I issued on 8th July last I announced a four-pronged attack on inflation. This attack included the lifting of the controls on interest rates on deposits, the further raising of the Reserve Bank’s pattern of interest rates on long-term Government stock, the further increase in the Reserve Bank’s discount rate to 6 per cent, the extension to 31st March, 1967, of the Reserve Bank’s request to monetary banks not to increase their credit to the private sector above the level of 31st March. 1965, the selective relaxation of import controls, and fiscal measures.

This Budget is mainly concerned with fiscal measures. Hitherto fiscal measures have played a less important role in combating inflation. Last year there was a limited loan levy on individuals and a modest surcharge and loan levy on companies. It was hoped that the monetary measures would suffice. They did not, and in last July the monetary measures were stepped up very sternly. This is the first opportunity we have had to call in the aid of fiscal measures to complement the recent monetary measures, and I propose to act accordingly. The principal requirement is that the necessary Government expenditure should be financed as far as possible in a non-inflationary manner, i.e. from current revenue and from the genuine savings of the people. To the extent that the Government spends money within South Africa from other sources, e.g. from credit created by the banking system, it is putting additional money into circulation and thus intensifying the inflationary pressure.

There are two factors which make it difficult for the Government to comply strictly with the demands of non-inflationary financing. The first is the technical point that the Budget this year is being presented four and a half months after the commencement of the financial year, so that only some seven and a half months remain in which to collect any additional revenue which may be needed. This means that, in order to raise a given amount of additional revenue, an excise duty, for example, might have to be raised to a much higher level than would have been necessary if the extra duty had been imposed at the beginning of the financial year.

The second factor is more fundamental. I have already mentioned the need to provide funds to enable the Republic to defend itself against any military or economic onslaught. Threats to the security of our country, uttered by the ignorant, the prejudiced, or the malicious, need not always be taken seriously, but the Government cannot afford to gamble with South Africa’s safety. The need to take adequate security measures has imposed a very heavy financial burden on the country, far heavier than would have been the case in normal circumstances. This makes our task of financing expenditure in a non-inflationary way a doubly difficult one.

The challenge of inflation, however, calls for positive as well as negative measures. Among the points of the four-pronged attack on inflation outlined in my statement of 8th July was the encouragement of saving, and this will receive further attention in this Budget. Another positive measure is the promotion of productivity, and this too is being actively pursued by the Government.

Through these positive measures, and through the temporary imposition of monetary and fiscal restraints, I am confident that we can destroy the inflationary peril and embark upon a new phase of stable economic growth. The Government is determined to achieve this objective and will not shrink from the necessary measures to attain it.

Before considering what ingredients would be appropriate for the 1966-7 budget, I shall give the House a short résumé of the financial results for—

THE YEAR 1965-6

Expenditure on revenue account amounted to R1,073,800,000 or R56,200,000 less than the amount provided in the main Estimates. This is partly due to the economy measures taken by the Government a year ago, but is mainly the result of an underspending of R46,800,000 by the Defence Department owing to delays in deliveries. Revenue exceeded the original estimates by about If per cent, principally because of an under-estimate of income tax and of departmental and miscellaneous receipts. The surplus on revenue account for 1965-6 therefore amounted to R70,200,000.

On Loan Account, the House will recall that in my Budget Speech last year I indicated that I intended, through strict economy measures, to effect a saving of R10,000,000 on the amount of R460,800,000 provided on the Estimates. With the co-operation of my colleagues I was successful in this endeavour and actual expenditure amounted to R447,900,000. Receipts were, however, substantially less than expected, mainly because of a shortfall of R70,000,000 in the amount made available through the Public Debt Commissioners. The financial year consequently ended with a deficit of R36,600,000 on Loan Account.

As an entrée—a very substantial one—to this afternoon’s main dish I turn now to—

THE LOAN ACCOUNT, 1966-7

Departmental requests on Loan Account amounted to some R537,000,000, which is R90,000,000 more than the amount spent during the previous financial year. With the co-operation of my colleagues I was able to reduce this figure by R59,000,000 to R478,200,000, which is still R30,000,000 or 6¾ per cent above the 1965-6 figure. I can assure the House that it is no easy task to cut expenditure on capital services of great importance for the social and economic development of the country, but under prevailing economic conditions even highly necessary works have to stand over for a later year.

The main increases compared with the previous financial year occur under the Votes Water Affairs (for the Orange River project), Commerce and Industries (additional capital for the Industrial Development Corporation for border area development, the aircraft industry and the purchase of tankers) and Community Development (for the Housing and Community Development Funds).

As was the case last year, substantial amounts are provided on the Agricultural Credit Vote, as also on Revenue Account, for assistance to farmers, especially those still suffering from the effects of the drought.

A decrease of R7,000,000 in the amount provided as a loan to South West Africa does not mean that the development of that territory will be slowed down. On the contrary, the authorities will press ahead with development in accordance with the recommendations of the Odendaal Commission, but the territory has at its disposal funds of its own which this year will be devoted to this work.

To the total expenditure from Loan Account of R478,200,000 must be added the following (the figures for 1965-6 are also given for purposes of comparison):

R million

1966-7

1965-6

Deficit on Loan Account at end of preceding year

36.6

19.4

Repayments of local stocks

219.8

141.7

Repayments of external loans

66.0

31.2

Miscellaneous repayments

14.5

15.1

—a total of R815,100,000.

I propose that the surplus of R70,200,000 on Revenue Account for the year 1965-6 be transferred to Loan Account. I propose also that the present loan levy on persons and on companies (other than gold mining companies) be continued for the current year, as foreshadowed in the Part Appropriation Debate last February. Assuming that the total amount of local loans maturing this year will be converted, that certain maturing foreign loans amounting to R46,100,000 will be renewed, and taking into account the net amount of new money obtained from internal stock issues since the beginning of this financial year, the amount available to finance the Loan Account is estimated at R690,000,000. An amount of R125,100,000 must therefore still be found.

The rapid growth of the South African economy will certainly continue to require heavy capital expenditure by the State on providing the essential infra-structure for economic development. The need to be fully prepared for any eventuality arising from the external political situation will also require additional expenditure for some time to come. The Orange River Project will also call for very large amounts of capital in the years to come. It seems to me inevitable, therefore, that expenditure on Loan Account will remain at a high level for the foreseeable future. In the circumstances I think it would be appropriate and prudent to divert certain tax revenues, particularly some of those associated with capital transactions, from Revenue to Loan Account. This is a very modest step, though not the first, in the direction of a unitary budget which will more clearly and correctly reflect State income and expenditure. I propose, therefore, that the revenues from transfer duty, rents of State property, and the small amount of estate duty still credited to Revenue Account, be applied to Loan Account as from the beginning of this financial year. This should yield R22,000,000 for Loan Account in 1966-7.

For many years now the export duty on uncut diamonds, which is credited to Loan Account, has remained unchanged at 10 per cent. I believe that a moderate increase in this duty—which would have the indirect effect of giving encouragement to our own diamond cutting industry—would be justified. I therefore propose that the rate be increased to 15 per cent from to-day. This should yield R1,500,000 in a full year and R1,000,000 for the current financial year.

Certain other tax changes, which I shall announce later, will have the effect of increasing the receipts on Loan Account by about R1,100,000 in 1966-7.

One of the best ways to counter the present inflationary trends is to encourage saving. It is also most important that the State’s capital expenditure should be financed, as far as possible, from non-inflationary sources, i.e. from genuine savings, and in present circumstances I think it proper that the State should attract a greater proportion of the community’s savings. As foreshadowed in my recent statement on anti-inflationary measures, therefore, the facilities offered to savers by the Post Office will be improved.

In the first place, the rate of interest on Post Office Savings Bank accounts will be increased from 4 per cent to 4½ per cent, and the annual amount of interest exempt from income tax will be raised from R100 to R200. Secondly, the rate of interest on Post Office Savings Bank Certificates will be increased from 41 per cent to 51 per cent, and interest thereon up to R400 (instead of the present R100) will be exempt from income tax; the period of notice required for repayment will, however, be increased from three to six months. Thirdly, a new form of savings instrument, to be called a savings bond, will be made available for individual savers. These will be similar to National Savings Certificates in that they will be five-year bonds, but redeemable on request at any time after one year; the rate of interest will begin at 4 per cent if the bond is redeemed after one year and rise progressively to 6 per cent if the bond is held to maturity. The minimum investment will be R50 and the maximum R20,000, and the interest will be tax-free. The bonds will be obtainable at post offices.

The changes in respect of the Post Office Savings Bank and Savings Bank Certificates will take effect from 1st October. 1966, and the new Savings Bonds will be introduced as soon as possible. The present series of National Savings Certificates will continue unchanged. A special savings campaign will be launched later this year, and I am confident that, when savers realize the very attractive facilities to be offered, the response will be substantial. I hope that we shall obtain an additional R15,000,000 by this means during the present financial year.

Foreign loans are at present extremely difficult to procure and rates of interest inordinately high, owing to the intense world-wide demand for capital. I shall certainly not relax my efforts to obtain such loans on reasonable terms but I do not think it would be realistic to rely upon raising more than about R15,000,000 from this source.

There remains a balance of R71,000,000 which must be obtained from the local capital market or—less desirably—by the issue of Treasury Bills, or by direct transfer from current revenue. The present rates of interest on long-term Government stock are the highest ever offered in the Republic and I hope that they will prove attractive to investors. As I mentioned in my recent statement, I think it is reasonable that insurance companies, pension funds and unit trust schemes should be required to hold at least a small proportion of their assets in Government stocks, and legislation is being introduced to this end. It should be remembered that life insurance companies and pension funds benefit from the income tax rebates granted in respect of premiums and pension contributions and from the estate duty deduction in respect of insurance benefits, and further that these institutions have a direct interest in maintaining the stability of the rand. The draft legislation has been sent to interested bodies and their comments will be considered before the Bill is introduced into Parliament; in brief, however, it will provide that a percentage of the prescribed assets which insurers (including Lloyd’s) and pension funds must hold in the form of gilt-edged and semi-gilt securities must in future be held in Government securities. Unit trusts will also have to hold a proportion of their assets in Government and semi-gilt-edged securities. The institutions will be allowed a reasonable time to comply with the new requirements.

It is certainly not my desire that this step should result in a substantial diminution in institutional investment in municipal and public utility loans, since these authorities also perform an essential national service, and the draft legislation has been framed with this end in view.

I hope that, with the aid of all these measures, it will ibe possible to raise R65,000,000 locally, leaving R6,000,000 to be obtained by transfer from Revenue Account.

I come now to the main course, namely—

THE REVENUE ACCOUNT 1966-7

Provision is made in the Estimates for Expenditure of R1,275,400,000 during the present financial year. This represents a reduction of R17,000,000 in the amount originally requested by Departments. Despite this reduction, the total amount required is a formidable sum and has caused me considerable concern. To some extent the essential increase in defence expenditure and in provision for the increased salaries and vacation bonuses for the Public Service are responsible, but the principal factor is simply the tremendous growth of our economy and the concomitant demand for public services of all descriptions. I can only say that I am convinced that the amount sought is not excessive in relation to the essential needs of the country.

Increased salary scales and vacation bonuses for public servants and provincial employees (excluding Defence) account for about R30,000,000 of the increase in the total provision above the 1965-6 figure. These increases were essential in order to check a serious situation which was arising because of the attraction of higher pay in the private sector and which might have resulted in a breakdown in the Public Service. To some extent, therefore, both Government employees and employees in the private sector whose salaries and wages have been increased have already been compensated for the rise in living costs.

The Defence Vote amounts to R255,900,000 or R26,500,000 above the main Estimates for 1965-6; this includes an increased provision of R25,000,000 for the Defence Special Equipment Account. Those who witnessed the military parade at the Republic Festival on 31st May will agree that the country now has something tangible to show for our heavy expenditure during the past few years. The verdict of the International Court on the South West Africa case may perhaps have reduced the immediate danger of military action against the Republic, but it has not lessened the malevolence of those who wish to bring about the Republic’s downfall, and we would be foolish and unworthy of our trust if we were to relax our vigilance or our preparedness. Barring any radical change in our international relations, however, I would hope that the great increase in defence expenditure has now come to an end and that it should be possible to stabilize this expenditure at roughly the present level, i.e., with only normal increases from year to year.

The Social Welfare and Pensions Vote shows an increase of R12,800,000 or 13.5 per cent, mainly on account of the increased benefits to social pensioners announced last November. I am sure all sides of the House will be glad that, even at this difficult time, the Government has found it possible to do something to assist the less fortunate members of the community, and thus help them to bear the burden of the increased cost of living.

The Government has also considered it essential to make a direct attack on the cost of living through increased subsidies on essential foodstuffs—maize and bread. The additional amount requested for food subsidies, as compared with the 1965-6 financial year, amounts to no less than R14,100,000—an in crease of 40.3 per cent.

As the Department of Indian Affairs has now taken over Indian Education from the Provincial Administrations, this Vote also shows a substantial increase.

The Vote of the Department of Education, Arts and Science shows an increase of R5,400,000 or 15 per cent, of which R3,000,000 is in respect of additional assistance to universities.

Mention should also be made of the increase of R14,400,000 in subsidies to the provinces and of R7,400,000 in interest on the public debt—unavoidable increases which the State must meet.

Although I am satisfied that all the amounts requested are, in respect of essential services urgently required in the national interest, I feel that, in present circumstances, a further determined effort must be made to curb expenditure. My colleagues have therefore agreed, through the exercise of strict economy, to effect a further overall reduction of approximately 1 per cent or R12.700,000 in expenditure on Revenue Account. This further reduction is not reflected in the printed Estimates.

On the other hand, the decision to maintain the price of bread unchanged despite the increase in the producer’s price for wheat will require a substantial additional subsidy during the present financial year, estimated at approximately R1,000,000. This is in addition to the amount provided in the printed Estimates.

After allowing for these changes and for the amount of R6,000,000 to be transferred directly to Loan Account, the amount required on Revenue Account will be R1.269,700,000.

REVENUE 1966-7

Estimates of revenue are difficult at all times, and especially when, as at present, there is some uncertainty regarding the future trend of profits, incomes, imports and the demand for excisable products. For the purpose of this Budget I have assumed that the taxable incomes of individuals will be about 5 per cent above the level for March, 1966, and of companies just under 6 per cent above the 1965-6 level. The income from other heads of revenue has been estimated on the basis of recent trends, account being taken of any other known factors. On this basis the total revenue for 1966-7, at existing rates of taxation, is estimated at R1,238,300,000, which is R64,300,000 or 5.5 per cent above the actual receipts for 1965-6. After deducting those items of revenue which, as I have already explained, I propose to transfer to Loan Account, the amount remaining is R1,216.3 00,000, as compared with the expected expenditure of R1,269,700,000. There is thus a shortfall of R53,400,000.

Before considering ways and means of finding this additional revenue, I think it may be advisable to add a little flavouring to the dish which I have prepared. I shall therefore first deal with a few tax concessions, most of which are designed to help productivity or to encourage provision for old age. The first relates to farmers, and concerns the—

EXPORTER’S ALLOWANCE

Thus far many farmers have not been able to benefit from the exporter’s allowance, i.e, the additional deduction from taxable income in respect of expenses incurred in the development of export markets, since these expenses were not incurred directly by the farmers but by the relevant co-operative societies or control boards. Indirectly, however, these expenses were borne by the farmers. With the co-operation of the societies and boards concerned I believe it should be possible to determine the amount of such market development expenditure which in effect is borne by each farmer, and I propose that the appropriate deductions should be allowed to the farmer in such cases.

The cost of this concession may next year amount to R100,000, but the loss of revenue during the current financial year will be negligible.

I also have concessions to offer in respect of—

NEW GOLD MINES

It is clearly in the national interest, and of great importance for the balance of payments, that the opening up of new gold mines should be encouraged. With high prevailing interest rates and other costs, it is becoming ever more difficult, at the present price of gold, to find new mining projects which would justify the heavy capital expenditure required. I believe that some tax concession here might, eventually, pay handsome dividends. I propose, therefore, that the capital allowance in respect of capital expenditure incurred by gold mines established after to-day be raised to 8 per cent per annum (instead of the present 6 per cent) and that the tax formula for such mines be altered to , which means that such mines will not pay income tax until their ratio of profits to recovery exceeds 8 per cent. No loss of revenue will be involved for some years to come.

For manufacturing industry, I also have some small concessions. The first concerns the—

MACHINERY INVESTMENT ALLOWANCE

This allowance is due to lapse at the end of the 1966 tax year, except for economic development areas and for certain deserving cases where the installation of the machinery has been delayed as a result of action by the State. When the allowance was introduced some six years ago I explained that it was in the nature of a temporary encouragement to investment in machinery, which might be withdrawn when conditions changed. Under present economic conditions there is no justification for extending the allowance and, accordingly, I announced no extension in my last Budget. The sudden cessation of the allowance may, however, mean that certain concerns will have to bear a very heavy additional financial burden. I propose to soften the blow by providing that an investment allowance at half the present rate will be granted in respect of machinery ordered before to-day. provided the machinery is brought into use within a reasonable time.

As a further concession, I propose that the machinery investment allowance, where it still operates, should be allowed to the owners of machinery where such machinery is leased to manufacturers. This will adapt the allowance to an increasingly common modern industrial practice.

PURCHASE OF PATENT RIGHTS

As another concession to modern practice, I propose that a person who purchases or develops patents, designs, copyright, trade marks or similar rights and uses them in his business should be allowed to deduct from his taxable income the cost of such rights, spread over the life of the rights or 25 years, whichever is the shorter.

EXEMPTION OF PUBLIC COMPANIES FROM DONATIONS TAX

As donations tax was primarily instituted to curb tax avoidance, and as public companies can hardly avoid tax in any of the ways which donation tax is designed to prevent, there seems to be no reason why public companies should not be exempted from donations tax, and I propose accordingly.

The loss of revenue attributable to these measures will be small.

REBATE FOR INSURANCE PREMIUMS

Now a touch of sweetening for the individual taxpayer as well as for insurance companies and pension funds. As an encouragement to saving and as an incentive to taxpayers to make adequate provision for old age and for their dependants, I propose that the tax rebate in respect of insurance premiums, which is at present fixed at 7 per cent of such premiums up to a maximum of R25, should be raised to 8 per cent with a maximum of R30. The loss of revenue is estimated at R700,000 for a full year and R200,000 for the financial year 1966-7.

CONTRIBUTIONS TO PENSION AND RETIREMENT ANNUITY FUNDS

For similar reasons I propose that the maximum deduction allowed in respect of contributions to pension funds be raised from R600 to R1,000 and the maximum in respect of contributions to retirement annuity funds from R1,200 to R2,000. The maximum is higher in the latter case because there is no employer’s contribution. It is usually for the so-called self-employed person. Where a person contributes to both types of funds, the overall maximum will be R2,000.

This concession will cost the Exchequer R175,000 in a full year and R100,000 in 1966-7.

A few other small tax concessions of limited scope will be submitted to the House when the tax legislation is introduced.

TRANSFER DUTY

After so much sugar, a few drops of lemon are called for. Two years ago I introduced a rebate of transfer duty for properties up to R15,000. This rebate was intended to benefit persons in the lower income groups, especially young people setting up house. I see no reason why the rebate should apply where the purchaser is a company and from to-day the rebate will be limited to individuals who purchase properties for residential purposes. This will yield R1,000,000 in a full year and R600,000 during the current year—all of which will now go to Loan Account.

It will by now be clear to the House that both the economic and the fiscal situation oblige me to propose increases in taxation—an unpleasant duty at all times, but one which is unavoidable at present if South Africa is to preserve its proud record of fiscal conservatism and financial stability.

Inflation is a serious problem threatening all sections of the community, and it is necessary to attack it on a broad front—with due consideration, nonetheless, for those least able to bear the burden.

I start with indirect taxes, and the so-called “conventional necessities” propose themselves as a first target, especially where the idea is to make the taxation as wide-ranging as possible.

CUSTOMS AND EXCISE DUTIES Beer

The consumption of beer has increased considerably in the past few years and I think the beer-drinker must pay his share of increased taxation. The structure of the brewing industry in South Africa is such, however, that the larger breweries should, in my view, be called upon to pay a small additional duty, which they should be able to absorb out of profits. I propose, therefore, that the excise duty on all beer should be increased to 74c a gallon, i.e. by 23c a gallon or about 1.91c a pint, but that where production is over 2,500,000 gallons a further duty should be payable, graduated according to the output of the brewery up to a maximum of an additional 6c per gallon on lager beer for breweries producing more than 12,500,000 gallons of such beer per year. Other types of beer will be subject only to the basic increase of 23c per gallon. The duty on all imported beers will be raised to the extent of the maximum increase on local lager beer. I expect the retail price of beer to increase, as a result of these changes, by not more than 2c a pint. The additional revenue will amount to R10,600,000 in a full year and R6,700,000 in 1966-7.

Spirits

The consumption of spirits has risen much more slowly than that of beer in recent years, and the industry—an important one in the South African economy—has not enjoyed the same prosperity as the brewing industry. In addition, it was doubly hit in the 1958 Budget. In these circumstances I consider that, while the drinker of brandy, gin or other spirits must also make his contribution, that contribution should not be so heavy as in 1958. Accordingly I propose that the customs and excise duty on spirits should be increased by 108c per gallon, equivalent to about 9c per tot. This should mean an increase in the retail price of both local and imported spirits of not more than 1c a tot. The additional revenue will be R10,000,000 in a full year and R6,300,000 in the present financial year.

My following two proposals are designed to enlist the support of two new consumer groups in the fight to meet the growing cost of national security. The first proposal relates to—

Mineral Waters

Some years ago an excise duty on mineral water was introduced, but was subsequently withdrawn. In present circumstances I think the time has come to re-impose a duty. I propose, therefore, that an excise duty of 8c per gallon, equivalent to ½c per 10-ounce bottle (the most popular size), be imposed immediately, and that the customs duty be increased by the same amount. It is not intended to apply the duty to fresh fruit juices or cool drinks with a fresh fruit base. Provision will be made for rebates of duty in respect of mineral waters when exported or supplied to those enjoying diplomatic privileges, and soft drink manufacturers are requested to keep a comprehensive record of such removals. The duty should yield R2,800,000 in a full year and R1,800,000 in 1966-7.

Kaffircorn-malt

I think it is fair that kaffircorn-malt, which is the basis of Bantu beer, should also be called upon to pay a small duty. I propose a duty of 1c a lb., which should have at most a very small effect on the price of Bantu beer. Rebates of duty will be allowed in respect of kaffircorn-malt exported or used in the manufacture of foods and stock-feed, and here again manufacturers are requested to keep a record of such removals. The revenue is estimated at R2,600,000 for a full year and R1,700,000 for the year 1966-7.

All manufacturers of those goods on which new excise duties are imposed, i.e. soft drinks and kaffircorn-malt, are required to take stock immediately of all stocks held by them and to record particulars of these stocks for use by the Department of Customs and Excise.

Cigarettes and Tobacco

The smoker can hardly expect to escape my attention. I propose that the stamp duty on cigarettes (both local and imported) be increased by 1c per ten cigarettes, the duty on cigarette tobacco by 1c per two ounces, the duty on cigars by 10c per lb. for imported cigars, the excise duty on pipe tobacco by eight per cent ad valorem and the customs duty on pipe tobacco by 15 per cent ad valorem or 23c per lb. whichever is the greater. These duties should yield an additional R13,000,000 in a full year and R8.100,000 in the current year.

Motor cars

The sales of new motor cars have been rising lately. I propose an increase of 2c per lb. in excise duty and 5 per cent ad valorem in customs duty. The existing rebates of excise duty in respect of motor cars manufactured in the Republic and having a content of components approved as being manufactured in the Republic will not apply to the increased duty. The increase amounts to about R40 for a light car and R60 for a medium car, and should yield R5,400,000 in a full year and R3,400,000 in 1966-7. Commercial vehicles, lorries, etc. are not affected.

Petrol and diesel oil

It is with some reluctance that I propose an increase in the duty on petrol and diesel oil, though it cannot be denied that much motor fuel is used for non-essential purposes. It is also fair, when the railway user has to pay higher tariffs, that the road user should also make a slightly higher contribution to the State. I propose an increase of 1c per gallon in the present customs and excise duties on petrol and on diesel oil used in road vehicles. The increase does not apply to diesel oil used for other than road purposes. The additional revenue will amount to R6.700,000 in a full year and R4,200,000 in the year 1966-7.

CUSTOMS DUTIES

My last proposal in respect of indirect taxation is that customs duties on an extensive list of luxury goods or goods produced locally, such as carpets, toys, electric lamps, domestic refrigerators and their components, domestic washing machines and electric stoves, should be increased in varying degree. Nearly all the goods affected are now manufactured in South Africa in adequate quantities and to satisfactory standards of quality. Full details of the proposed customs duties are contained in the list which I shall lay upon the Table. The expected additional revenue is R1,900,000 in a full year and R1,200,000 in the current financial year.

All the amendments of customs and excise duties and the new excise duties which I have announced will take effect immediately, and will apply to the goods concerned which have not been entered for home consumption at this moment. The increased duty on local and imported beer and local and imported spirits (including spirits in spirituous beverages), however, will be payable on such stocks which have not at this time been delivered from the stocks of importers, manufacturers, distributors, wholesale dealers and retail dealers, and on subsequent additions to such stocks. All such traders should take stock immediately and record particulars of these stocks for the information of the Department of Customs and Excise.

Mr. Speaker, in terms of Section 58 (1) of the Customs and Excise Act, 1964, I now lay upon the table, for consideration by the House in Committee of Ways and Means, the formal taxation proposals in respect of customs and excise duties.

I trust that the consumer prices of all the goods affected by these proposals will not be raised by more than is justified by the increase in the duties. The Department of Commerce and Industries will watch the position, also in respect of locally-produced goods in competition with imported goods now liable for higher customs duties.

The lengthy list of customs and excise duties with which I have dealt, may have led some hon. members to think that I have forgotten about—

DIRECT TAXATION

Let me set their fears at rest. As I said earlier, an attack on a broad front is required, and direct taxes must also play their part. I start with—

NON-RESIDENT SHAREHOLDERS TAX

This tax has remained unchanged for many years at 7½ per cent, which is considerably lower than the corresponding rate in most other countries. Moreover, since the tax is nearly always allowed as a credit when the foreign shareholder is taxed in his own country, an increase will, in the majority of cases, not impose any net additional tax burden on the shareholder and hence should not discourage foreign investment in the Republic. The foreign investor enjoys very favourable treatment in South Africa and I think a moderate increase in the tax is justified. I propose that the rate be increased to ten per cent in respect of dividends declared from today. The additional revenue is estimated at R4,600,000 in a full year and R3,100,000 in the financial year 1966-7.

I come at last to income tax, and I deal first with the—

INCOME TAX ON COMPANIES

The basic rate of income tax on companies (other than gold and diamond mining companies) has remained unchanged at 30 per cent for several years. This is a low rate by comparison with many other countries, and I think that the higher level of expenditure which seems likely to prevail in the future justifies an increase. I propose, therefore, that the basic rate should be increased to 33f per cent from the 1966-7 companies’ tax year. This will yield an additional R18,200,000 in a full year and R6,600,000 in the present fiscal year. The Provinces will continue to receive their 5c in the rand.

The five per cent surcharge will fall away but, as I mentioned earlier, the five per cent loan levy will continue. Since this levy will apply to a higher basic tax, an additional R500,000 will accrue to Loan Account in 1966-7. In a full year the amount will be R1,700,000.

GOLD MINES

Last year no surcharge was applied to the gold mines, but under present conditions I think they too should make a small contribution from profits. I propose a surcharge of five per cent on the income tax payable by gold mining companies from the 1966-7 companies tax year. This should yield R4,500,000 in a full year but only R700,000 in fiscal 1966-7.

DIAMOND MINES

In the case of diamond mining companies I propose that the five per cent surcharge imposed last year be continued and that a further five per cent surcharge be levied for the 1966-7 companies’ tax year. The estimated additional revenue is R23 0,000 in a full year and R100,000 in 1966-7.

Finally I come to the—

INCOME TAX ON INDIVIDUALS

Last year individual income taxpayers escaped any increase in tax rates except for the loan levy payable by those liable for central government income tax of R95 or more. This excluded about two-thirds of the taxpayers. This year I think that all individual taxpayers must bear at least some part of the burden. I propose that the five per cent discount on individual income tax be withdrawn in respect of the tax year ending 28th February, 1967. I must call attention to the fact that nearly half the tax year has already passed and that it will not be possible to introduce new P.A.Y.E. tax deduction tables for employees before October; the monthly tax deductions for employees will, therefore, have to be increased by considerably more than five per cent. Similarly, provisional taxpayers should be careful to make adequate provision during the remainder of the tax year, for their ultimate tax liability.

The withdrawal of the discount should yield additional revenue of R12,400,000 in a full year and R9,800,000 in the current year.

The total additional revenue from all these tax increases is estimated at R53,700,000 for the year 1966-7. After deducting the expected loss of revenue amounting to R300,000 in respect of increased rebates for insurance premiums and for contributions to pension and retirement annuity funds, we are left with R53,400,000, which was the amount required to balance the Revenue Account.

SUMMARY

I append for the record a summary of the Budget for 1966-7:—Revenue Account

R

Expenditure as shown in printed Estimates

1,275,400,000

Less 1 per cent reduction

12,700,000

1,262,700,000

Add Additional subsidy on bread

1,000,000

Transfer to Loan Account

6,000,000

R1,269,700,000

Revenue on existing basis of taxation

1,238,300,000

Less Revenues transferred to Loan Account—

Estate duty

3,000,000

Transfer duty

16,000,000

Rents from State property

3,000,000

Tax concessions in respect of—

Insurance premiums

200,000

Pension fund and retirement annuity fund contributions

100,000

22,300,000

1,216,000,000

Add Increased duties on

Beer

6,700,000

Spirits

6,300,000

Mineral waters

1,800,000

Kafficorn-malt

1,700,000

Cigarettes and tobacco

8,100,000

Motor cars

3,400,000

Petrol and diesel oil

4,200,000

Various imported goods

1,200,000

Increase in Non-resident Shareholders Tax

3,100,000

Increase in Income tax on companies

6,600,000

Withdrawal of discount on Income Tax on individuals

9,800,000

5 per cent surcharge on gold mines

700,000

5 per cent surcharge on diamond mines

100,000

R1,269,700,000

Loan Account

Expenditure as shown in printed Estimates

478,200,000

Plus Deficit on loan account 1965-6

36,600,000

Repayments and miscellaneous

300,300,000

R815,100,000

Receipts:

Loan recoveries

86,800,000

Surrenders 1965-6

2,000,000

Public Debt Commissioners

140,000,000

Loan levy, 1966-7

23,000,000

Treasury and non-resident bonds

8,000,000

Internal loans—conversions

219,800,000

Internal loans—new money already obtained

94,100,000

External loans—renewals

46,100,000

R619,800,000

Plus

Surplus on revenue account, 1965-6

70,200,000

New internal loans

65,000,000

New foreign loans

15,000,000

Post Office Savings Bank, etc.—additional receipts

15,000,000

Additional loan levy on companies

500,000

Additional export duty on diamonds

1,000,000

Transfers from revenue account—Estate duty

3,000,000

Transfer duty

16,600,000

Rents from State property

3,000,000

Direct transfer

6,000,000

R815,100,000

The dish which I have prepared, Mr. Speaker, may not appeal to those who seek only a sweet taste or a fleeting flavour, without regard to the nutritive value of the meal. South Africa needs more than that. What I have set before you is, I believe, good wholesome fare, rich in those ingredients which are necessary to attain the objectives which I outlined at the beginning of my speech, and therefore appealing to the mature financial palate.

Let me recapitulate briefly. The first point of my plan was the security of our country. For that I have made adequate provision, not only on the Defence Vote, but also in respect of economic security. My second point was economic stability and the curbing of inflation. This Budget makes an honest attempt to finance State expenditure as far as possible in a non-inflationary manner—I shall return to this point in a moment. The third point was the encouragement of economic growth. There can be no sustained growth in South Africa unless it continues to have sound money. The post-war experience of Germany in 1948 and France in 1958 confirms this thesis. To retain a stabilized currency here, has been one of the preoccupations of this Budget. The fourth and last point of the plan was assistance to those who find it difficult to make ends meet, particularly in the process of fighting off the attacks on the stability of our currency. In this connection I would mention not only the increased social pensions which come into force this year, but also the very considerable sums provided to stabilize the prices of essential foodstuffs. Moreover, the tax increases which I have reluctantly been compelled to propose do not affect the prices of most of the necessities of life nor, in the case of direct taxation, do they affect the lower income groups who fall below the income tax exemption limits—limits which by international standards are generous.

Nevertheless, it will be asked, was it really impossible to finance State expenditure except by raising taxes? My answer is that it could be done, but only by risking further inflation—e.g. by borrowing the money from the banking system. I reject this method because of its inflationary effects.

Inflation is not merely an ugly word. It is a brutal fact. It works insidiously like cancer, and like cancer it feeds upon itself.

Its first victims are the people with fixed incomes—pensioners, annuitants, and those dependent on the income from fixed interest bearing investments. It reduces the purchasing power of these incomes and causes hardship, often to those least able to bear the burden.

Next, it attacks the salaried man and the wage earner who must wait for a rise in his salary or wage to catch up with the rising cost of living. Only too often, a rise in salaries or wages in an inflationary situation only results in a further rise in prices, so that the salary or wage earner is no better off in the end.

The gold mines, the price of whose product is fixed, also suffer directly from increased costs, and this affects not only the profits of the mining companies but also the present and future employment opportunities on the mines. Similarly, farmers and industrialists who produce mainly for the export market—and this includes a large proportion of our farmers—are liable to find their incomes reduced because increased costs cannot be passed on in the form of higher prices.

The farmer or industrialist who serves mainly the home market is sometimes inclined to believe that he will benefit from the increased money incomes of consumers in a time of inflation. But this is a short-sighted view. Firstly, higher prices render the local product more vulnerable to competition from outside our borders. Secondly, bottlenecks and increased costs are liable to eat up a large proportion of his initial increased profits, and ultimately the fall in the real income of a large part of the home market and the general disruption of the economy must work to his detriment.

Inflation or the eroding of the purchasing power of the rand, is the personal enemy of every single one of us. There is only a difference in the time in which it makes its effects felt, between one person and another. It is therefore necessary that concerted action should be taken against the enemy on a wide front, and that if sacrifices are called for each should bear his share in accordance with his capacity to bear.

Inflation can be crushed—it must be crushed. The Government is adamant on this, because it is so essential to the sustained growth of our economy—on which our capacity rests to ward off aggressive action, as well as boycotts and sanctions. For this reason I believe that I can call with confidence upon the people of South Africa to bear the additional burdens I have proposed.

If all stand together, spend judiciously, save more and work harder, the fight need not be prolonged. And then South Africa, with her abundant resources, will stand ready again for a new era of stability and growth.

I now lay upon the Table:

  1. (1) Estimates of Expenditure to be defrayed from Revenue, Bantu Education and Loan Accounts during the year ending 31st March, 1967 (R.P. 1—1966, R.P. 9—1966 and R.P. 8—1966).
  2. (2) Estimates of the Revenue to be received during the year ending 31st March, 1967 (R.P. 49—1966).
  3. (3) White Paper in connection with the Budget Statement, 1966-7.
  4. (4) Taxation Proposals.
  5. (5) Comparative figures of Revenue for 1965-6 and 1966-7:

REVENUE 1965/66 R1,000

Head of Revenue

Receipts

Original Estimates

Increase

Decrease

R

R

R

R

Customs and Excise Customs Duties

Customs

114,002

118,200

4,198

Excise Duties

Beer

18,209

16,500

1,709

Wine

7,092

8,500

1,408

Spirits

45.568

46,000

432

Acetic Acid

29

20

9

Cigarettes and Cigarette Tobacco

55,023

59,000

3,977

Pipe Tobacco and Cigars

5,658

6,000

342

Petrol

21,224

22,100

876

Kerosene, Distillate Fuels and Residual Fuel Oils

3,462

2 900

562

Matches

634

570

64

Pneumatic Tyres and Tubes

2,140

2,800

660

Motor Cars

21,519

22,500

981

Gramophone Records

462

510

48

181,020

187,400

2,344

8,724

Miscellaneous

1,847

200

1,647

Total for Customs and Excise

296,869

305,800

3,991

12,922

Posts, Telegraphs and Telephones

Posts:

Postage

24,855

25,290

435

Commission

677

675

2

Box and Bag rents

801

780

21

Ocean Mail Service

693

800

107

Miscellaneous

2,153

1,765

388

29,179

29,310

411

542

Telegraphs

10.436

9,860

576

Telephones

67,268

70,000

2,732

Official Posts, Telegraphs and Telephones

3,368

3,330

38

Total for Posts, Telegraphs and Telephones

110,251

112,500

1,025

3,274

Inland Revenue

Mining

State Ownership Revenue

Licences and Mynpacht Dues

363

379

16

State Diamond Diggings

2,936

2,755

181

Income Tax:

Normal Tax:

Gold Mines

92,671

93,107

436

Diamond Mines

2,121

3,300

1,179

Other Mines

17,600

18,750

1,150

Individuals

197,814

188,100

9,714

Companies (other than Mining)

268,302

255,500

12,802

Interest on Overdue Tax

479

400

79

578,987

559,157

22,595

2,765

Non-Resident Shareholders’ Tax

13,794

13,500

294

Undistributed Profits Tax

787

650

137

Donations Tax

450

350

100

15,031

14,500

531

Licences

5,356

5,750

394

Stamp Duties and Fees

19,866

21,500

1,634

Estate Duties

3,003

3,000

3

Bantu Pass & Compound Fees

154

150

4

Fines and Forfeitures

3,158

2,950

208

Quitrents and Farm Taxes

7

6

1

Rents of State Property

2,827

2,500

327

Forest Revenue

3,000

3,000

Recoveries of Advances

1,170

620

550

Transfer Duty

15,372

22,000

6,628

Tax on Purchase and Sale of Marketable Securities

2,694

4,900

2,206

Cinematograph Films Tax

1,176

1,100

76

57,783

67,476

1,169

10,862

Departmental and Miscellaneous Receipts: Contribution from South West Africa in terms of the Police (S.W.A.) Act, 1939

400

400

Government Garage

8,354

8,420

66

S.A. Reserve Bank

3,262

2,700

562

Mint

12,473

1,000

11,473

Government Printer

4,341

4,500

159

General

38,722

34,000

4,722

67,552

51,020

16,757

225

Interest:

On State Loans and Investment of Cash Balances

40,383

39,511

872

Dividends

3,848

3,849

1

44,231

43,360

872

1

Total for Inland Revenue

766,883

738,647

42,105

13,869

Total Revenue to be Received

1,174,003

1,156,947

47,121

30,065

Net increase

R 17,056

REVENUE 1966/67.
(On existing basis of taxation.)
R1,000

Head of Revenue

Estimates 1966/67

Receipts 1965/66

Increase

Decrease

R

R

R

R

Customs and Excise Customs Duties:

Customs

108,000

114,002

6,002

Excise Duties:

Beer

21,300

18,209

3,091

Wine

6,400

7,092

692

Spirits

46,500

45,568

932

Acetic Acid

35

29

6

Cigarettes and Cigarette Tobacco

58,210

55,023

3,187

Pipe Tobacco and Cigars

5,800

5,658

142

Petrol

34,000

21,224

12,776

Kerosene, Distillate Fuels and Residual Fuel Oils

5,000

3,462

1,538

Matches

720

634

86

Pneumatic Tyres and Tubes

2,000

2,140

140

Motor Cars

21,000

21,519

519

Gramophone Records

475

462

13

201,440

181,020

21,771

1,351

Miscellaneous

360

1,847

1,487

Total for Customs and Excise

309,800

296,869

21,771

8,840

Posts, Telegraphs and Telephones

Posts:

Postage

25,405

24,855

550

Commission

685

677

8

Box and Bag rents

820

801

19

Ocean Mail Service

700

693

7

Miscellaneous

1,820

2,153

333

29,430

29,179

584

333

Telegraphs

11,255

10,436

819

Telephones

72,000

67,268

4,732

Official Posts, Telegraphs and Telephones

3,565

3,368

197

Total for Posts, Telegraphs and Telephones

116,250

110,251

6,332

333

Inland Revenue

Mining:

State Ownership Revenue:

Licences and Mynpacht Dues

374

363

11

State Diamond Diggings

3,106

2,936

170

Income Tax:

Normal Tax:

Gold Mines

90,200

92,671

2,471

Diamond Mines

4,400

2,121

2,279

Other Mines

18,750

17,600

1,150

Individuals

220,250

197,184

22,436

Companies (other than mining)

284,000

268,302

15,698

Interest on Overdue Tax

470

479

9

618,070

578,987

41,563

2,480

Non-Resident Shareholders’ Tax

14,500

13,794

706

Undistributed Profits Tax

850

787

63

Donations Tax

500

450

50

15,850

15,031

819

Licences

5,500

5,356

144

Stamp Duties and Fees

20,500

19,866

634

Estate Duties

3,000

3,003

3

Bantu Pass and Compound Fees

160

154

6

Fines and Forfeitures

3,200

3,158

42

Quitrents and Farm Taxes

6

7

1

Rents of State Property

3,000

2,827

173

Forest Revenue

3,000

3,000

Recoveries of Advances

1,080

1,170

90

Transfer Duty

16,000

15,372

628

Tax on Purchase and Sale of Marketable Securities

3,250

2,694

556

Cinematograph Films Tax

1,200

1,176

24

59,896

57,783

2,207

94

Departmental and Miscellaneous Receipts:

Contribution from South West Africa in terms of the Police (S.W.A.) Act, 1939

400

400

Government Garage

8,500

8,354

146

S.A. Reserve Bank

4,500

3,262

1,238

Mint

11,000

12,473

1,473

Government Printer

4,400

4,341

59

General

37,700

38,722

1,022

66,500

67,552

1,443

2,495

Interest:

On State Loans and Investment of Cash Balances

44,551

40,383

4,168

Dividends

3,849

3,848

1

48,400

44,231

4,169

Total for Inland Revenue

812,196

766,883

50,382

5,069

Total Revenue to be Received

1,238,246

1,174,003

78,485

14,242

Net increase

R64,243

Mr. S. F. WATERSON:

Mr. Speaker, of all the comic fancy-dresses the hon. the Minister has donned year after year in his Budget speeches, I do not think there has ever been one less appropriate than the one he put on to-day. He has appeared before us as a chef. A chef, Sir, is a super cook. I will not repeat the well-known Army story about the cook because I think you, Sir, would rule me out of order if I did. [Laughter.] I can only say that so far from being a chef, what the Minister has produced to-day could be described in Army language as a real dog’s breakfast.

I have listened to the Minister, as we listened last week to his colleague the Minister of Transport. Last week we had a Budget from the Minister of Transport which, from the taxpayer’s point of view, was bad. The Minister this afternoon appeared to me to take a sort of gloomy satisfaction, and almost a sadistic pleasure, in going one better—or should I say one worse—than his colleague the Minister of Transport. These two hon. gentlemen in the course of one week and quite light-heartedly have proposed to take something like R100,000,000 from the public in extra charges and taxation. However the Minister may disguise himself as a cook, nothing can really alter the fact that what we are having now in these budgets is nothing but part of the bill for five years of gross mishandling of the country’s economy. It bears out what we said before the election, that the Government’s slogan was then “Vote now and pay later”, and listening to the hon. the Minister of Finance outdoing his colleague the Minister of Transport this afternoon, I was reminded of the Hebrew king who told his people: “My father (in this case the Minister of Transport) chastized you with whips, but I shall chastize you with scorpions.” Certainly the proposals the Minister has put before us this afternoon are infested with scorpions, as we shall make a point of high-lighting in the course of the coming debate. A little while ago there was considerable talk in the Press that the hon. the Minister was thinking of retiring and that this Budget was likely to be his swan song. The hon. the Minister contradicted that suggestion and quoted Mark Twain. He said that the stories of his political death were grossly exaggerated. I think that having listened to the hon. the Minister this afternoon one could appropriately quote another poet who wrote that—

Swans sing before they die, men say. ‘Twer no bad thing if some men died before they sing.

I think the hon. the Minister of Finance may live to realize how true that is before he does retire, when he realizes the full effect this Budget is going to have on this country. However, we shall have the opportunity of discussing this more fully at a later date, and in accordance with the usual practice I move—

That the debate be now adjourned.

Agreed to.

COMMITTEE OF SUPPLY—RAILWAYS AND HARBOURS (Resumption)

Heads Nos. 1 to 17,—Railways, R602,772,000.

Mr. H. M. TIMONEY:

After listening to the hon. the Minister of Finance, one is keen to get back to our battle with the hon. the Minister of Transport. We have heard the words “Save, save, wherever you can and cut down expenses”. But I want to deal with the matter of expenditure, the question of the maintenance of Railway property. Wherever you go you see stations and houses that the Railways have built, in a dilapidated condition. The maintenance of Railway properties seems to be the Cinderella section of the Railways, and when Railway employees complain to you about their accommodation being in a dilapidated condition and you ask what they have done about it, they say that they are invariably told that there is no money. I think the Minister should give some attention to this very important aspect. We find that, on the running side, by timely and adequate maintenance he saves millions of pounds. He runs his workshops with a very high degree of productivity and he does everything possible to maintain his rolling-stock, but when it comes to the ordinary buildings, station buildings and housing, they are overlooked. Money seems to be short and cannot be found for that. I do not want to be parochial because this does not only apply in my constituency but also elsewhere, but in my constituency, at places like Varkiesvlei, where there are about 20 houses, these houses are built of the usual P.W.D. red brick style and over the years very little has been done in the way of maintenance to these houses. They were constructed before there was water-borne sewerage, and the conveniences of these houses are still in the back-yards and the condition of their hot-water systems leaves much to be desired. They have electric light, because we have passed the candle stage, but generally these properties are in a rundown and dilapidated condition and are rapidly developing into a slum. There are no made-up roads. When one approaches the authorities concerned to do something about the roads in bad weather, one is told that there is no money for improvements. Actually these roads have never been made up. There is no drainage and the holes are covered with ash.

The MINISTER OF TRANSPORT:

Where are these roads?

Mr. H. M. TIMONEY:

At Varkiesvlei, at the lower end of Observatory. They are mostly houses of members of the running staff. Most of the tenants have motor-cars but no garages. I think an inspection of these properties will show what I mean and what is happening. Some attempt has been made to clean up stations, but generally speaking when you go round you find that Railway buildings are in a very dilapidated condition. I think this is one of the Cinderella departments of the Railways, where the maintenance of buildings and offices has been sadly neglected and it will eventually cost the Minister thousands to put them in order. I hope the Minister will give attention to this matter.

*Mr. M. S. F. GROBLER:

I want to take this opportunity of putting in a good word for members of the railway staff who are entrusted with high responsibilities without receiving any additional remuneration. In general, the basis laid down by the regulations relating to hours of duty is an 8-hour shift for station foremen and station masters on the smaller stations, particularly in the rural areas. That is the rule, but variations occur on some sections, in my own constituency, for example, where the shift varies between 8 hours and 10 hours almost from one station to another. I may mention, for example, stations like Buhrmannsdrif (8 hours), Slurry (8 hours), Ottoshoop (10 hours), Zeerust (8 hours, Woodbine (10 hours), Groot Marico (8 hours), Twyfelspoort (10 hours), Swartruggens (8 hours), Mazista (10 hours), Koster (8 hours), Derby, Boons and Syferbult (10 hours), Magaliesburg (8 hours) and Tarlton (10 hours).

The position is that in practice station masters and foremen on the 10-hour shift stations actually work 12 hours at a stretch; as a rule there is no third member of the staff available. Nor are the men allowed to go home after having completed their 10-hour shift. They handle the same number of trains as the men on the 8-hour shift stations. The quantity of traffic handled is perhaps smaller than at the larger stations, but because the work is all-embracing, the quality of service rendered and the responsibilities borne by these men are equal and even greater. They cannot delegate part of their work to other officials. There are usually only two officials, for example at Woodbine station and also at some other stations I have mentioned here, who are on their own week after week, and month after month, on a 12-hour basis. These men have come to see me several times, and it is their humble request that the Minister should give favourable consideration to the conversion of all stations on the section mentioned—this will probably also apply to other cases in the country where the same rule is in operation—to the 8-hour basis, in order to bring them into line with the other stations; or, if that cannot be done, as a result of a shortage of manpower, that he should give consideration to the introduction of a wage adjustment conforming to the recognized overtime scale, until such time as the necessary personnel are available. That would ensure a more equitable remuneration for services actually rendered. These men render invaluable and indispensable services on a duty-hour basis, which means that they have to suffer great inconvenience. They cannot go home after a 10-hour shift, because they cannot leave their station unattended. Consequently they have to do 12 hours’ duty day and night.

Calculated at a scale of remuneration for services rendered at 2 hours’ salary per day, this amounts to 51 hours per month, which in turn amounts to 79 days’ unpaid service. At R1 per hour, that means a loss of R624 per year to these men. The fact is that the man who works on an 8-hour basis with Sunday time added, plus 2 hours’ ordinary overtime pay, can gain a further 2 hours, and actually receives overtime payment for 4 hours, or has 2 hours free for his own use and to be with his family. The men who are compelled to work 10 plus 2 hours and receive overtime for only 2 hours are therefore in a rather unequal and unfavourable position compared with their colleagues who work on an 8-hour basis. It is calculated that if the Administration were to employ extra personnel, the Railways would gain because the commencing salary of a station foreman, with Sunday time and overtime included, amounts to only about R156 per month, whereas the overtime and Sunday time of a station master and station foreman who work on a 10-hour basis, mean an extra expenditure of approximately R230 per month.

I wanted to raise this matter and I will appreciate it if the hon. the Minister can give attention to it, because it affects a large number of men on many railway stations, and because these men feel unhappy about what they regard as unfair and unequal remuneration for services actually rendered by them. They are compelled to handle the same number of trains as those on the larger stations and on the stations where the 8-hour shifts are in operation, and for 12 hours per day they can never leave their stations. When their services are urgently required as a result of an accident or for the essential replacement of someone on another station and they have to go away, the one who remains is sometimes on duty alone for 18 or 24 hours at a stretch. For that reason I considered it essential to bring this matter to the hon. the Minister’s attention. What these people plead for is not so much a financial adjustment, but also a more convenient arrangement of hours of duty, so that they will have more free time at their disposal and will also be able to give better service as more contented officials. [Time limit.]

Mr. H. LEWIS:

I want to bring to the notice of the Minister certain problems to do with the Bay Head area, Durban, and possibly to give the Minister the opportunity of taking us into his confidence and telling us a little about the plans he has for that area in future. As you know, Sir, the Bay Head area is within the Harbour of Durban and I think it is accepted by most people that the operations which take place there by way of shunting, etc., are one of the main causes of our atmospheric pollution in Durban. From time to time we have discussed this aspect with the Minister and he has made promises. He has promised increased electrification in the shunting yards, and he has done that to a certain extent, but I do not believe he has carried it out sufficiently quickly or efficiently enough to make a major contribution to solving this problem of air pollution. Then he has embarked upon a huge development programme in the Salisbury Island area, where he has the construction of a new pier well in hand, but he has made no provision whatsoever that we can see for making a roadway to bring the supplies necessary to that particular area. These remarks apply also to the traffic which goes to and from the petrol storage facilities in the Island View area. The Minister will know that there is such development going on in that area at the moment that it is high time that he provided some roadway across the Railway property at the Bay Head to divert the petrol tankers from the residential areas of the Bluff. I think the Minister must concede that the time is long past for him to do something and he must make some contribution towards providing such road facilities. We have had accidents with these tankers in the built-up residential areas, as the Minister knows, and we have been very fortunate indeed that they have not been more serious than they were.

Now, on the actual question of shunting itself I want to deal particularly with the Fynnland area. The Minister’s Department has had a sheaf of letters—I have the acknowledgment of some of them here—complaining about the use of the Fynnland yard, which was originally, we were told, designed for staging, but is now being used for shunting. The reason is possibly a very good one. The Minister’s Department is now making up block trains to deal with the congestion in the harbour area and to get the traffic out of the harbour as quickly as possible, a very commendable thing to do. We are glad that he has devised this method of getting rid of the congestion we had before, but he is using for this purpose an area that was never intended to be used for such a purpose. As a result, it is not properly equipped for the task. I contend that if the Minister is going to convert this area, which borders on a very good residential area—in other words, he has virtually invaded this residential area—he must go to some lengths to cushion the impact of a new shunting-yard on such an area. I think the least he can do is to speed up the investigation his Department promised me, by way of investigating whether they can put up a mechanical hump there, or at least to electrify the remaining lines. Only four lines are electrified in that area and I think the Minister has had ample time now to have devoted himself to electrifying that particular yard. I think, too, that the Minister has had adequate time to put in some diesel electric units in that area, as he suggested he was going to do, to take up the slack between now and when he is able to take enough electric units off the main line and adapt them and put them into the shunting-yards there. I believe that the Bay Head yards are so important that we should be told what the Minister is going to do. He also has to make adequate provision for the new shipbuilding yards which are being developed in that area. They are going to attract quite a lot of traffic, because Durban services a lot of ships, and this will also add to the congestion in the Bay Head Yard.

Sir, it is not only the question of shunting alone which is going to create this problem. It is the question of all these added industrial organizations, essential organizations, such as the petrol companies at Island View, the Bay Head yards where all the big engineering firms are concentrating their efforts, and they have been encouraged by the Government to do so. I personally believe that they are lagging far behind the private organizations in the planning of roads and facilities which have to be provided in the area if they are going to develop properly and yet at the same time not encroach upon the beauty of that area and the facilities and amenities which the ordinary citizens have at present. I feel that the hon. the Minister owes a large debt to the people of Durban. He has to develop these areas and we want him to do so. We do not want to restrict him. I do, however, believe that there are many aspects in this development to which the hon. the Minister should have applied his mind. He has not done so. I am asking him now to take us into his confidence and to tell us what he is going to do. We are prepared to help him in suggesting what other facilities should be added in that area to make the development workable.

*Mr. C. J. REINECKE:

Mr. Chairman, the reason why I have chosen to make my maiden speech in this House in this debate on the Railway Estimates is mainly that the inhabitants of the Pretoria (District) constituency take the greatest interest in the estimates under discussion and the observations which have already been made here in regard to the problems of inflation and the rising cost of living. This constituency includes a reasonably large area where agriculture is practised on both an intensive and an extensive basis—where the cattle farmer and the grain farmer have noted with appreciation that in their industries no increases have been announced as far as the tariffs for the transportation of cattle, fertilizer and agricultural line are concerned. Here as well, Mr. Chairman, as in the rest of the drought-stricken Transvaal, the cattle farmer, the grain farmer, the vegetable and the fruit farmer have had an uphill struggle as a result of the prolonged drought, and our urban consumers are thoroughly dependent on their weal or woe. Apparently few people realize what an enormous task the South African Railways has been fulfilling over the past two years and is still fulfilling in the various drought emergency relief projects in the Transvaal—projects which have had to be undertaken in the so-called drought disaster areas in order to save both the people and the cattle there. In this connection I am making specific mention of the removal of slaughter and breeding stock from the disaster areas. Thousands of head of cattle have been transported with relatively little loss. I also want to mention the transportation of fodder from all parts of the country—thousands of tons—to the disaster areas. The saving of valuable Bushveld breeding cattle has become a personal matter for all the Railway officials concerned. I want to praise them—the clerks, the checkers, the station-masters and particularly the drivers of the heavy buses. I had the privilege of seeing them in the remote areas in the Eastern Transvaal and on the Makatini Flats, where they drove their big and heavily laden Railway buses very skilfully along wet, difficult roads, and also in the drought-stricken areas where they went to offload the fodder. Some mistakes were made, but it is only where no work is done, that no mistakes are made.

But, Sir, the majority of the inhabitants of my constituency are salary-earners. They are salary-earners in the employ of the Government and, until a few years ago, I also had the privilege of being one of them and of working here in Parliament Street. There are salary-earners in the employ of the Railways and the Airways, salary-earners in the service of the Army, the Education Department, the Provincial Administration, local authorities and in the service of Iscor and other bodies. Lastly, there are also great numbers of pensioners who in their day also served our country loyally. This constituency’s most important asset is therefore its human material—those who make excellent contributions to keep our entire Railway and State machine functioning smoothly and well. To keep these people happy and fully productive it is probably also necessary to see to their economic security. Mr. Chairman, yesterday the hon. the Deputy Minister referred to Sport Park Station, which is seven miles from Church Square and from which a railway ticket to Pretoria is now going to cost R3.42 per month instead of R2.85. That station, Sir, is one of the various suburban stations in the Pretoria District constituency from where a thousand or more officials travel to their work in Pretoria and Johannesburg each day. We are grateful that we are still able to get to our work so relatively cheaply in comparison with motor and bus transport, particularly since we know that the Railways has been transporting us at a loss for many years.

The Deputy Minister mentioned two other matters arising from the Railways Estimates debate which are equally topical as far as the Railwaymen and the other salary-earners in Pretoria District are concerned and as is probably the case in all other constituencies of this nature, They are in connection with the question of economic exploitation. It is a matter, Sir, of that tin of jam of 1962 which, when the railway tariff on its transportation was increased by .22 of a cent, underwent an increase in the retail price of three cents. That phenomenon is discernible in the case of numerous levels of consumer goods, even up to the level of production requirements in agriculture. The hon. the Deputy Minister also expressed his gratification at the fact that the Minister of Economic Affairs has been instructed by the Government to keep a watchful eye on commerce so that the increased transport tariffs are not unnecessarily passed on to the consumer, as we are accustomed to some of them doing—I emphasize some. Commerce has made a careful study of the consumer, and particularly of the housewife. It concentrates its powerful advertising machine on the housewife, who carries the purse, and it obtains its increased turn-overs and higher dividends whether there are increased railway tariffs or not. This is not the occasion to elaborate on that, but where the danger of a stimulus for an increase in the cost of living is seen in this Railway Budget, I just want to point out that the consumer in South Africa is absolutely unorganized. As an individual he is practically defenceless as far as the spending of his salary is concerned. South Africa compares unfavourably with countries such as Israel, Norway, Sweden and the U.S.A., with their strong co-operative consumers’ movements. In Israel co-operative consumer organizations control the greater part of commerce. In South Africa only 2 per cent of the entire retail trade is controlled in this way. Perhaps the time has come for the consumers in South Africa to organize themselves voluntarily and on a much larger scale into co-operatives and by so doing simply to force down the cost of living. The consumer knows that the Railways does not operate on a profit basis and will not take anything which is not its due. The affairs of commerce, however, are not thrown open to inspection, as are those of the Railways in this House. The consumer is not seeking to do anybody an injustice, he is only seeking justice for himself. He would prefer to achieve his own prosperity in peace and friendship and fair competition, but he wants to achieve it. And the cooperative course is the course which, in my opinion, the consumer should take in order to be able to achieve it.

Mr. L. F. WOOD:

Mr. Chairman, I should like to take this opportunity of congratulating the hon. member for Pretoria District on the occasion of his maiden speech. I am sure that he will feel much happier now that that ordeal is over. I must compliment him on the way in which he delivered his speech. It is obvious that he prepared the subject matter carefully. He delivered his speech with confidence. I am sure that if he continues in this strain, he will make a noteworthy contribution to this House.

I wish to refer again to the question of accidents. This matter has been raised by members on this side of the House and the hon. the Minister has referred to the fact that the question of accidents is engaging the full attention of his Department. It is a matter which is causing a certain amount of concern to all people in this country. I do not think at this stage that South Africa has any great cause for complacency. I see from the latest figures I have been able to obtain, that as far as the global situation is concerned, South Africa is second highest to Brazil in the number of fatalities in the year 1965 in so far as major train accidents are concerned. In regard to our own figures, we find that for the year 1964-5, there were less than three accidents per million miles traversed. As far as the number of fatalities is concerned, the figure was .04 per million passengers. On the surface, Sir, that seems to be a good figure. But what we have to bear in mind is that it does not compare with the all-time low of the previous year, and it does not compare with the average for the previous 15 years. I think one is justified in asking why the low figure for the previous year has not been maintained. Are there reasons for such an increase, or should one expect a fall in the accident rate? I feel that there are factors which should lead to the improvement of this situation. These factors involve improvements to the track, signalling control, traction and braking systems. There is another aspect, and that is the excessive speed factor. I believe that when we examine that factor, we have to be objective about it. I think the position is well summed up in the report of the Commission of Inquiry into the dispute between the South African Railways Administration and the Staff Association. I refer to paragraph 50, where it is said:

Although the running times of trains have been speeded up, the general speed of trains has not been increased.

As far as speed is concerned, it seems that perhaps the assessment of speed is a factor which should engage more attention than it has in the past. Last week I put a question to the Minister in regard to speedometers on locomotives. I found the answer to be very enlightening. The Minister, in a comprehensive reply, indicated that speedometers were fitted to most electric and diesel locomotives, and to a large percentage of steam locomotives operating on main lines. The answer indicated that there was still a number of steam locomotives which required speedometers. But is that the full picture? The answer referred only to main lines. What is the position in regard to branch lines, suburban lines, and the non-White services?

The MINISTER OF TRANSPORT:

When we talk about main lines, we mean locomotives other than shunting locomotives.

Mr. L. F. WOOD:

I thank the hon. the Minister for that explanation. There seem to be further difficulties, because in his answer the Minister said that in some cases it was difficult to obtain spare parts for certain types of speedometers fitted to certain locomotives. I see too that in so far as electric locomotives are concerned, the speedometers are tested approximately once in 18 months or when reported defective. In the report to which I have referred, evidence given by the Staff Association was:

A driver must estimate the speed of his locomotive because the speedometers are unreliable.

To counter that, the Administration, supported by expert opinion, stated:

A driver does not rely entirely on his speedometer, because speedometers on locomotives are not satisfactory in all respects.

The report continued by saying that a driver was taught, and through experience was able, to estimate fairly accurately the speed. Mr. Chairman, I think any motorist, no matter how experienced he might be, would admit that when it comes to estimating speed, it can be very difficult. Those who have been caught in speed traps may find that their assessment does not always stand up to scientific data. I feel that this is a matter which requires investigation. The question of the efficiency of speedometers and also of the estimation of speed must be investigated. I will say, in fairness, that the commission also went on to indicate that there was no conclusive factual evidence that the high percentage of accidents or the increase in the percentage of accidents had been caused by exceeding the speed limit. But, Sir, it still leaves a nagging fear that if the speedometer on a locomotive is not accurate, or reliable, it places too large a responsibility on the driver of that locomotive to make sure that he is not travelling at a speed in excess of the safe speed. There is another factor to which I wish to refer briefly, and that is the question of accidents which may in part be attributed to the consequences of long hours of duty which result in a strain on health. There again, this commission expressed an opinion, and I believe that one has to view this problem objectively. They stated that they had certain statistics “which apparently indicate that there is no direct connection between the working of lengthy hours and the occurrence of accidents”. But, Sir, in spite of this, I believe that the public of South Africa has the right to be reassured in regard to this aspect, and that every effort should be made by the Administration to control the question of speed, its assessment and the whole question of speedometers on locomotives.

*Mr. G. P. VAN DEN BERG:

Mr. Chairman, I should like to express my agreement with the hon. member for Berea, who has just sat down, that it is the earnest desire of all of us to eliminate accidents wherever we can. I think, however, that the hon. Minister has given a conclusive reply in that regard. He said that accidents did not occur only through mechanical failure, but that the human element must always be taken into account. I do not want to say any more about that. I agree with the hon. member that all of us will be glad if we can succeed in eliminating accidents.

I rise to say that I am grateful that the South African Railways are under the charge of this Parliament and above all under the charge of the present Minister of Transport. I still remember the days when a motion was introduced and a plea was made from the Opposition side that the Railways and transport services should be run by private enterprise. I now want to deal with the service rendered by the South African Railways in the past, the service it is rendering at present and the service it will render in the future to South Africa and to the agricultural industry in South Africa. I want to express my appreciation for what was done by the South African Railways during the time we suffered such a terrible drought. We may as well bear in mind that we will always have similar disaster or drought conditions in South Africa. Those are the times when we are glad to know that we will always have a South African Railways which will adopt a sympathetic attitude and will not exploit the farmer, but will come to his assistance. I therefore want to express my appreciation to the South African Railways on behalf of the agricultural industry for what they did during the recent drought which we suffered.

I also want to say that we are glad that we can say that our transport services in South Africa have a proud record. Minor irritations do occur from time to time, however, and I should like to bring them to the notice of the hon. the Minister. In Wolmaransstad there were houses which had lost their plaster. They needed to be replastered and repainted. We asked repeatedly that that be done. I am taking the liberty of mentioning the matter here now. Our representations were almost in vain. More than a year went by before the work was carried out. Families had to be accommodated in those Railway houses. Those families exercised a great deal of patience in living in those houses, but also suffered much inconvenience in doing so. More than a year went by before those houses were replastered and repainted. I am mentioning this to the Minister because these are minor matters which do not affect the main principle but which nevertheless have a disturbing effect on the staff’s relationship towards the Railways.

I also want to plead for the electrification of the station and the provision of electric lights in the houses at Ottosdal. Ottosdal is in my constituency and I know what inconvenience is caused there. Ottosdal does have electricity, but it is not connected to the station and the Railway houses, and I shall be glad if the hon. the Minister will give his attention to the matter.

Dr. A. RADFORD:

Mr. Chairman, I wish to draw the attention of the hon. the Minister to the plight of some of his ex-senior officers. These gentlemen have served the Railways for many years and in some cases, or in all cases really, have reached a senior position in the service. They mostly retired with pensions at or above R75 if single and R150, if they were married. These men have seen their pensions eroded by inflation in nearly all cases. The rand has depreciated by at least 20 cents in the past ten years, according to the Cape Town Chamber of Commerce. The cost-of-living index has risen since 1958 by at least 16 per cent, so that the purchasing power of the pensions of these gentlemen has diminished and in some cases has forced them and is forcing them to reduce their living standards. I am sure that the hon. the Minister will agree that it is hardly fair that a man who has given his whole working life, from youth to his retiring age, should be placed in this position. If a man spends his life in a service, we are entitled to expect that such a man should not have to reduce his standard of living. In 1958-9 the hon. the Minister made a special temporary allowance to pensioners, but the pensioner if employed by the private sector was not allowed to receive a pension plus the allowance above the level of R75 per month if he was single, or if he was married, above the level of R150. If a pensioner was employed by the Railways or by a Government Department, he was allowed to earn as much as he liked without penalty. In other words, for some obscure reason work in the Government sector had a special tag on it, enabling a man to raise the value of his pension. To me, Sir, this seems to be unjust. There is no real difference between money handed out by a Government Department and that handed out from the private sector, except that the former print the money. If two men from these sectors happened to meet in the street and the one gave the other say change for a £5 note, nobody would be able to tell the difference in the money. I should like to ask the Minister particularly to pay attention to this group and to see whether he cannot give relief in some way or another. I think too that the standard of R75 for a single man and R150 for a married man is to-day much too low. It should not be the standard of pension for men who have reached senior status in the Railway service. It does not compare in any way with the private sector and it does not compare with the pension standard of a man holding the position to-day which these men had held in the past. They have contributed to the pension fund as it stands to-day. They are not receiving the treatment that is given to the man who retires to-day. I think consideration should also be given to the fact that the retiring age in the Railways is fixed. Except in the case of people who have retired because of ill-health, no account is taken of the man’s actual working capacity. A man who has reached the age of 60 or 65 is retired willy-nilly. He may be failing, old and almost senile or he may be the equal of a man of 40. One must consider that fact when deciding to allow such a man to take other employment. If a person is compelled to retire at a certain age, there should be no interference whatever with what he does for the rest of his life. If he feels that he can work and if he can persuade other people to give him work, he should definitely be permitted to do so and to use the money as he wishes. There should be no difference whatsoever between the money earned in the Government sector and that earned in the other sectors. I should like to ask the hon. the Minister to give consideration firstly to removing the block which prevents men from working profitably to reach an income above R75 in the private sector, but which allows them to do so if they work in the Railways or in other Government sectors. Secondly, I should like the Minister to reconsider the level which he has imposed, namely R75 and R150, and to change it to something which will to-day be more realistic, namely about R150 for a single man and R250 for a married man. Modern pensions must take into account the erosion caused by inflation and the rising cost of living. The Railways claim to be modern and they do try to modernize. But they have not modernized their pension system. It is time that they did so, Sir. It is now accepted that pensions should be recalculated yearly and we find that an institution like the Netherlands Bank is giving annual rises to all its employees on pension. In the United States workers retiring from the service of the federal government have a built-in guarantee making provision for a revision of their pension as the cost of living rises and the purchasing power of the dollar decreases. Pension payments to the old pensioners should at all times equal the pension which would be given to a man occupying the same position to-day calculated annually.

There is one other small matter to which I should like to refer. This is in connection with the bad arrangements, temporary as they are, at the Cape Town air terminal at present. I know difficulties have been experienced as a result of the main building being incomplete; but at the same time I feel that the officials concerned have not taken sufficient care to see that their temporary arrangements work satis factorily. On Sunday last I arrived in Cape Town on the late plane. I and the other passengers took the coach to Cape Town where we arrived in an open street with only one unfortunate porter running around trying to handle all the luggage. No arrangements had been made, neither were there any facilities for making arrangements to obtain a taxi or any other form of transport to our hotels. There was a fair number of passengers and this porter had to run about in the streets trying to find taxis. That took him quite a time and caused considerable delay. I feel that the arrangements could have been better organized.

Mr. D. M. CARR:

Mr. Chairman, this is the first occasion on which I have the privilege of addressing this House and as one of the newcomers I would like, at the outset, to express my appreciation for the very real spirit of friendliness, hospitality and helpfulness I as a new member encountered.

I intend confining my speech on this occasion to two matters which relate to transport and to the railwayman in my constituency. First of all, it gives me pleasure to thank the Minister for having accepted a plan to solve a very thorny problem, a problem of long standing, at Mowbray station. The suburban station of Mowbray falls within the constituency of Maitland. That station has for many years been the terminus of a bus service run by a private company conveying Coloured workers from the Coloured residential areas. This resulted in a very heavy congestion in and about the station and this together with the bad elements amongst these Coloured workers created great dissatisfaction in that area. However, the hon. the Minister agreed to appoint a committee of investigation into the matter. Agreement has been reached and a plan has been worked out between the Department of Community Development, the Railway Administration and the bus company concerned, a plan making provision for the bus terminus to be moved from the White residential area to a point across the line. This will result in the majority of Coloured workers in future by-passing the White residential area and being conveyed by direct route to the industrial area of Salt River where they work. I believe this plan constitutes a solution to the problem experienced hitherto and will as such bring great satisfaction to the voters in my constituency. Therefore I should like to thank the Minister once more for this new arrangement.

There is, however, another matter which is causing great dissatisfaction in Maitland itself. There is only one subway at Maitland station. There is, it is true, a footbridge but this bridge only connects the platforms. Maitland station is rather in the middle of a White residential area but there are also a large number of factories in that area. That brings a large number of Coloured workers to Maitland. In addition there is a large number of Bantu workers working in Paarden Eiland and a large number of schoolchildren daily come to Maitland because there are many schools there. But we have the unfortunate situation at the station that there is no separation between the three racial groups, that is between the White, Coloureds and Bantu. Many of the Bantu are still given to primitive habits. Many of my voters in the constituency of Maitland are working people and have to use the railways every day for the purpose of going to and returning from their work. As such they have to use the subway at least once a day. Now, what happens in this subway in the mornings is really shocking. This subway is old and narrow and as you know when the Coloureds and Bantu are in a hurry to catch a train they just do not worry and almost daily White women have to suffer the indignities of being jostled and of almost being pushed down the steps. This subway is dangerous particularly at night time because no one is safe there after seven o’clock. This position is the cause of great dissatisfaction throughout the whole of Maitland and therefore I respectfully ask the hon. the Minister to give his attention to this problem, either by building a second subway or by building a footbridge connecting one side of the line with the other for the use of the non-Whites.

Lastly I should like to raise the question of housing for railwaymen living in Maitland. I have received numerous requests for housing. I have discussed the matter with the Railway authorities where I was very sympathetically and kindly received. It appears, however, that the problem is insoluble on account of there not being sufficient houses. I realize, of course, that under the present circumstances funds for the provision of houses are not readily available but I should like to ask the hon. Minister respectfully to provide more Railway houses in Maitland whenever funds should become available.

Capt. W. J. B. SMITH:

Mr. Chairman, wonders never cease. I never thought it would be my pleasure, as a maiden, to thank another maiden on his maiden speech. I should like to congratulate the hon. member who has just sat down on his speech. He certainly has taken the right direction because he has pleaded the cause of what for the politician is number one, namely his voters. I am sure the hon. member is going to do very well in this House.

There is one small matter I should like to raise, and that is to fight the cause of the casual employees on the South African Railways. In order to do that I want to take a particular case in point as an example. A certain young man of Pietermaritzburg decided to join the South African Railways. He was of good appearance, had a good education and apparently he joined with the idea of making it his career. Soon afterwards, however, he was called up for military service. He was then called upon to sign an undertaking, and to sign it together with his parents, to the effect that on his return from military service he would continue to work for an equal period for the South African Railways. Under those circumstances he left for training but on his return he found, to his very great disappointment, that he would not be paid the difference between his Railway and military pay. Had he been in the employment of the private sector he would have been paid the difference. For him there was quite a considerable amount involved, something in the vicinity of R480. However, on his return from military service he returned to the service of the South African Railways and is still working for them. Now, is it fair that he should be treated better by the private sector than by the South African Railways? This is especially of importance in view of the present shortage of manpower on the South African Railways. I believe that if he is appointed on the temporary staff within three months after his return from military service the money will be paid out to him but that is a matter which is beyond his control as the question of whether or not he will be appointed to the temporary staff is in the hands of the Administration. So I want to plead for these youngsters. They should be paid out this money which, surely, belongs to them. Moreover, I am sure the hon. the Minister can afford to do so.

*Mr. P. S. MARAIS:

Mr. Chairman, there are two matters I want to bring to the notice of the hon. the Minister, matters which concern my own constituency more particularly. The first is the possibility of a short railway link somewhere between the Berg River and Vredenburg, a link which will serve the St. Helena complex. During the past few years this particular complex has developed into what is probably the most important complex for our fish industry on the West Coast. With the exclusion of South West, the St. Helena complex, with its seven or eight factories, yields 60 per cent of our fish products at present. Through Viskor the State has also started building a new harbour at Sandy Point. All the indications are that in the years that lie ahead this St. Helena complex will develop into the most important complex on the West Coast. At the moment the products of that complex are transported by road to Vredenburg at an annual cost of approximately R100,000. It so happens that the Government granted additional fishing concessions last year, two of which will be exploited in the St. Helena complex. In the meantime a factory has been completed which has a working capacity of 45 tons per hour. I want to ask the hon. the Minister whether it is not possible to provide a short railway link between the Berg River and Vredenburg stations to serve this particular complex. Once the new production being planned at present is in full swing, the cost of road transport will be increased to a figure in the vicinity of R124,000. I realize that this is perhaps not the right moment to ask for such a link, but I have mentioned this in the hope that it would at least register with the hon. the Minister, so that this small project will be considered in the near future.

The second matter I want to raise is in connection with the Saldanha Bay station. I Consideration should be given to the possibility of moving this station to the Saldanha Bay harbour. The station there is still very primitive and therefore I should really have asked that something should be done in that respect. But seeing that this is so and seeing that it is essential that better facilities be provided there, we have to view the matter in relation to the possibility of moving that station. Saldanha is rapidly expanding at present. This old station, primitive as it is, is situated in the centre of the town at present. Major extensions by Viskor are in progress in the harbour. One large factory has already been completed and others are being planned. For that reason I wonder whether the time has not arrived for us to consider the possibility of moving the station from its present location to the harbour itself.

I realize that I am asking for these two projects at a time which is perhaps not opportune, but I raise these matters in the hope that the Minister will make a note of them so that he may perhaps be able to consider them in the near future.

Mr. G. N. OLDFIELD:

It is usual for hon. members when the policy of the hon. the Minister is under discussion, to raise certain particular aspects concerning their own constituencies. So I want to do what the hon. member for Moorreesburg just did and plead for the provision of certain facilities in the area which I represent in this House.

Firstly, there is the question of a new station for Durban. The hon. the Minister is no doubt aware that this is a hardy annual which is continually being brought up. On the 9th August, that is during this Session, the hon. the Minister was asked what progress was being made in regard to the provision of a new station in Durban. He replied that the necessary land had been expropriated and that preliminary layout plans for the whole station complex had been prepared. He was, however, unable to say when building operations would commence. I should, however, be grateful if the hon. the Minister could give us some indication of whether he has a priority list for the provision of new major stations. There is already a magnificent station in Johannesburg and a very fine station is nearing completion in Cape Town. As far as Durban is concerned, I am sure that it must be very high on the priority list. I should like the hon. Minister to tell us what the exact position is as regards Durban. This is a matter affecting the future growth and development of the city itself. It is already a large city but yet we find that the Railway workshops are situated almost in the middle of it and occupying land which is urgently required for the future development and growth of the city itself. I submit that it is in the interests of the country as a whole that the development and growth of a major city should not be impeded by Railway workshops.

Another item which is of particular interest to the area I represent is the noise and smoke caused by the Railways. This matter has also been mentioned by the hon. member for Umlazi and is a matter which certainly is causing a great deal of concern, especially to property owners. The marshalling yards in Durban have been established in close proximity to residential areas. Therefore I think it is imperative that the hon. the Minister should take steps to ensure that the steam locomotives are replaced as soon as possible by diesel units, thereby eliminating one of the main causes of the smoke nuisance and excessive noise. Many of these property-owners are but ordinary people who have sunk their life savings in their properties. Therefore I make this plea to the hon. the Minister for the replacement of steam locomotives by diesel and electric units. Because of the sitting of the harbour and the marshalling yards, a large number of trains have to use the railway lines running along the Victoria embankment. All along the embankment we find large and expensive blocks of flats. Indeed, the whole area there is one continuous residential area. Noise caused by trains travelling along the embankment is causing much concern to people in the vicinity. I would be grateful if the hon. the Minister could consider the welding of the lines along the Victoria embankment, because there would then be less noise caused by moving trains. Many residents in that area have asked me to make this suggestion to the hon. the Minister. They feel that the welding of the tracks might very well cause a considerable reduction in the volume of noise which they at present have to tolerate.

Another matter which I now want to raise with the hon. the Minister is not of a parochial nature but rather of a general nature. I wish to raise certain points concerning railway pensioners who receive temporary allowances and the effect of their re-employment on the staff and employment position of the S.A.R. in general. When he answered a question in the House about a week ago, the hon. the Minister gave various figures relating to resignations from the Railways. I think that it is significant that the number of resignations has increased in recent times. For instance, in 1964 there were 14,757 resignations, whereas in 1965 the figure had increased to 15,204. On the other hand there has also been an increase in the number of recruits accepted by the Administration. In 1964 17,014 people were accepted and in the following year the figure had risen to 18,762. Nonetheless, Mr. Chairman, the Railways are still suffering from a severe shortage of manpower. Now, Sir, when Railway pensioners are re-employed, their earnings are not taken into account for deciding whether they should be paid a temporary allowance or not. To a certain extent they thus receive preferential treatment. No doubt the idea behind this benefit is to encourage ex-Railway employees to take up re-employment with the Administration. All this leads me to ask the hon. the Minister whether he is satisfied that sufficient posts are available for all those Railway pensioners who seek re-employment with the Administration. I ask this, Sir, because I have information that a number of Railway pensioners have taken up employment, or hope to take up employment, in the private sector. Unless they are employed in the public service, the S.A.R., or a provincial administration, they run the risk of losing their temporary allowance. These men feel that they can contribute something towards easing the manpower shortage in South Africa. Although they desire to take up employment in the private sector, they are apprehensive about accepting such a post because the possible loss of the allowance will result in an appreciable drop in their over-all income. These people feel that they are being discriminated against. The hon. the Minister has said that this is a matter which must be cleared up by the Department of Social Welfare acting in liaison with his Department. Nevertheless, Mr. Chairman, our Railway pensioners look to this Minister—the Minister of Railways—to fight for their cause and to bring about a more equitable state of affairs as far as they are concerned. Therefore, Sir, I should like to ask the hon. the Minister whether there are sufficient vacancies to absorb Railway pensioners who desire re-employment on the Railways. If the answer is in the negative, then perhaps the hon. the Minister can give further attention to the anomaly which arises when Railway pensioners are employed in the private sector with consequent possible loss of the temporary allowance. We must not forget that by working in his old age, the pensioner remains a productive unit in the South African labour market. I do hope the hon. the Minister will give this matter his serious attention.

*The DEPUTY MINISTER FOR SOUTH WEST AFRICA AFFAIRS:

Mr. Chairman, all I am getting up for, really, is to thank the hon. the Minister for everything he has done for South West Africa. [Interjections.] If hon. members on the opposite side knew how much has been done for the Railways in South West Africa, they would also feel the need to thank the Minister. Hon. members on that side of the House should remember that when the United Party was in power it was dangerous for expectant mothers to venture upon a train journey in South West Africa. But I do not want to discuss South West Africa affairs now. I want to talk to the hon. the Minister about something which affects all Railwaymen, namely the dress of our Railway workers. One cannot help feeling sorry for the people when you see how they sweat in their dark uniforms, stiff collars and ties when serving passengers in sweltering heat. Quite a number of servants have in fact asked me whether they cannot be given some relief in this regard. A year or two ago the hon. the Minister of Justice decided to allow policemen to wear light uniforms when performing their duties in certain circumstances. The new lighter uniforms have met with general approval and have contributed a great deal to making working conditions more pleasant. I therefore want to ask the hon. the Minister of Transport to consider issuing lighter uniforms to be worn in the hot summer months when the busy running staff in particular have a hard time of it.

*Mr. S. J. M. STEYN:

Mr. Chairman, I should also like to discuss with the hon. the Minister one or two matters which are of interest to the public. When the hon. the Minister announced the new tariffs last Wednesday, it was brought to my notice that the new tariffs entailed a good deal of extra work for the commercial section of the Administration, as well as for clerks at outlying stations who have to deal with tariff calculations. I understand that new tariff instruction books will be issued soon. The staff concerned also have to study the official tariff book in its revised form. At every station these clerks—and many of them are second grade clerks who do not receive high salaries—will have to draft new tariff lists for their respective stations. That will enable them to deal immediately with tariff enquiries on the part of the public. It amounts to this, Mr. Chairman, that a new book will have to be taken in which the name of every station and siding in South Africa will have to be entered. The various tariffs applicable to consignments between the station concerned and every other point of delivery in the country will have to be entered in 14 different columns against each place name. Because these new tariffs will come into operation as early as 1st September, considerable overtime work on the part of those who have to compile the new tariff lists has to be accepted as inevitable. They have to perform this extra duty, at a stage when the Railways are already suffering from a serious shortage of manpower.

*Mr. N. F. TREURNICHT:

But you complained that they were not doing enough work.

*Mr. S. J. M. STEYN:

It is a pity that the hon. member should have made such a flippant interjection at this stage, because I am dealing with a matter which is important to those people. It is such a silly interjection. What I was complaining about, is the fact that the organization on the part of the Management leaves much to be desired, and that it results in an unsatisfactory productivity figure. Now the hon. member wants to suggest that I made an attack on the staff. After all, I have said repeatedly that the responsibility for productivity was the responsibility of the Management. This is the kind of difficulty one has with hon. members on the opposite side. I said, Mr. Chairman, that these people would have to work very hard in order to complete their task by 1st September.

*Mr. J. P. C. LE ROUX:

They can do it too.

*Mr. S. J. M. STEYN:

Of course they can do it, and they will do it too, even if they have to work overtime for many hours and many days. What I want to know from the hon. the Minister is whether he will make the necessary arrangements so that these people will in fact have the time for doing the work. If they do in fact have to work a great deal of overtime in order to complete the tariff lists, will he see to it that they are compensated in some way or other? I am sure that I am not addressing an unreasonable request to the hon. the Minister, and I trust that the hon. members who were so quick to interrupt me will now come forward to support me in this regard. Then one will see how much interest they are really taking in the people I am talking about now. Or are they merely interested in the votes of these people? Mr. Chairman, that is one point I want to raise, and I trust that, seeing that our time is limited, the hon. the Minister will to-day still give us an indication of what he intends doing in regard to the extra work which will be involved in the drafting of the new tariff lists.

Another point I want to mention, Sir, is the unsatisfactory manner in which applications for leave are sometimes dealt with. Complaints have reached me from quite a number of officials. An applicant for leave frequently has to wait an uncommonly long time before he hears whether his leave has been granted, and if so, whether it has been granted for the period applied for. A certain official recently told me in Johannesburg that he could not obtain leave for the period he wanted it for. Well, that one can still understand, because the Railways is a tremendous organization and has many problems to contend with. But not long after that he was told on a Friday afternoon that he—and he is a married man with children—had to take his leave as from the following Monday. That official then found himself in an impossible position. He is a man with a wife and children and if he wants to spend his holidays at another place, he has to book accommodation and make all the arrangements which a family holiday entails. I wonder whether something cannot be done, particularly in the interests of good relations between management and employee, to see to it that officials are informed in good time that the period applied for by them cannot be granted. Should another period be granted them, they must also be notified in good time so that they may make the necessary arrangements.

Another complaint I have heard, Mr. Chairman, is about the difficulty experienced by officials at outlying stations to obtain nominations for and appointments to the staff of the System Manager. Many clerks desire such appointments. For some reason or other many Railway clerks believe that should they want promotion, they should work in a head office. They are regularly given the opportunity of asking for a transfer to such an office, but it very seldom happens that a clerk does obtain such an appointment. As one of the clerks put it to me, “Once one has been posted to one of the outlying stations, one belongs to the Lost Legion of the S.A.R.” Somebody told me about a recent case where certain vacancies had to be filled in the office of a system manager. When all the vacancies were filled, it was found that they had all been filled by a number of trainees who had recently left training schools, while not one of those at outlaying stations had been considered. Many such cases occur, Mr. Chairman. Now, as I have said on a previous occasion, I do not think it is the task of the Opposition to interfere in detail in the management of the Railways. Nevertheless, I feel that when the same type of complaint so often reaches one’s ears, it is the duty of the Opposition to bring these matters to the notice of the hon. the Minister. I am sure he appreciates being told of these cases, because, Sir, although one sometimes feels very critical of certain aspects of the administration of the S.A.R., one has to accept—and that we do—that it is the desire of the hon. the Minister and the Administration to bring about the greatest measure of satisfaction and efficiency among the staff. That then is the spirit in which I bring these few matters to the notice of the hon. the Minister.

*Mr. H. J. BOTHA:

Mr. Chairman, I also have a few minor matters regarding my constituency that I want to discuss here. Before doing so, I should like to express my gratitude and appreciation to the two system managers in charge of the Railways in and around my constituency. One of them is stationed at East London and the other at Durban. These two gentlemen did their utmost, particularly in difficult circumstances, for example when we had the heavy snowfalls last year, to ensure that nothing went wrong with the smooth handling of railway traffic.

Now, Mr. Chairman, I should like to bring to the notice of the hon. the Minister the inadequacy of the goods-shed at Matatiele. The goods-shed is hopelessly inadequate for the large volume of goods that has to be handled. This goods-shed serves the entire eastern part of Basutoland, as well as the north-western part of the Transkei. It sometimes happens that several days are spent searching for certain goods in the goods-shed, owing to the unsatisfactory conditions prevailing there.

The housing at Matatiele also leaves much to be desired, Sir. In spite of the very high rentals many officials prefer to rent private houses rather than to live in Railway houses, because the latter are not in a very good condition.

I also want to appeal to the hon. the Minister not to transfer the running staff at present stationed at Aliwal to Burgersdorp. Quite a number of the running staff at Aliwal have already been transferred. If any further transfers take place it will have a detrimental effect on the economy of Aliwal. Further transfers will also reduce the community of Aliwal considerably.

Mr. W. M. SUTTON:

Mr. Chairman, I wish to refer to a matter which was also raised by the hon. member for Humansdorp in his maiden speech yesterday, namely the replacement of the narrow-gauge line by a broad-gauge line in that area. The hon. the Minister intimated that he felt sympathetic about the matter, but of course he could not spend the R30,000,000 required for the change-over at this time. I feel that we have a moral claim to any improvements which may be necessary to make the narrow-gauge line in which I am particularly interested, namely that between Umzinto and Donnybrook in Natal, more efficient and better able to serve the interests of the farmers in that area. Now, Mr. Chairman, I wish to refer to the station at Highflats. The Highflats area has undergone tremendous changes in the past five or six years. Sugar quotas have been issued in the district. Where there was before a great interest in timber planting, over the past year or so especially great new interest in the planting of timber has been shown, particularly by large companies. These companies are planting timber on a considerable scale. Now, Sir, Highflats railway station is totally inadequate to serve the needs of the district. Formerly the truck position was bad, but I understand that in recent times a considerable number of new trucks have been taken into service in the Highflats area. I also learnt with interest that eight new units are to be put into service on narrow-gauge lines in the country. I hope that the narrow-gauge line between Umzinto and Donnybrook will get more than its fair share of these new units! We need these units, Sir. The difficulty about Highflats station is that there is no ground for expansion, unless there is a breach of the Administration’s decision that no side-line or spur line may be taken off the main line. Should this prohibition be waived, the problem could so easily be solved. The lay-out of the terrain is such that all bulk cargoes, such as timber and sugar, can be loaded from a higher point into the truck standing on a lower level, making the loading of these heavy and bulky commodities so much easier. And if it were possible to do it in a place which is already cut or prepared for a spur—before this decision is taken—you would obviate some 90 per cent of the traffic to the High Flats Station from having to cross the line. And, Mr. Chairman, I need not tell anybody here who are farmers of the dangers and the difficulties which are involved in moving large quantities of bulk commodities such as timber and sugar, moved by tractors and trailers with Native drivers, over a railway line. The dangers inherent therein are self-evident. While I do not expect that the hon. the Minister will solve this problem immediately, I do ask that he gives it his very serious consideration. I am of the opinion that the area of High Flats will undergo considerable development. In the last year or so four farms have been bought for timber planting and I believe that this penetration of the big company interests in that area is to continue. And I say again, Mr. Chairman, that the station facilities in that area are simply not adequate. The facilities as they exist today are a real hazard to the farming community, to their drivers and to their vehicles as well as to the staff of the South African Railways. I sincerely hope that the hon. the Minister will give this matter his attention.

*Mr. J. P. C. LE ROUX:

Mr. Chairman, I should also like to bring certain matters to the notice of the hon. the Minister. One of these affects Vryheid specifically, and relates to the expansion of the Railways that is taking place there at present. In particular, I want to say something with regard to the maintenance of the streets between the buildings. Apparently there is some principle involved, because for some reason or other the Railway houses built in Vryheid and those still under construction have, as a result of the extensive development that has taken place there, been virtually isolated from the rest and form an entity of their own. Of necessity the Railwaymen are localized close to the station, and the streets that have been built there actually fall outside the municipal area—in actual fact outside the area of responsibility of the Municipality of Vryheid. As a result the Municipality was not prepared to undertake the tarring of the streets between those houses. It has now come about that one of those streets is being used as a main street from the station to the new industrial site, with the result that the heavy traffic using it churns up a tremendous deal of dust. You can therefore appreciate, Sir, what the poor housewives’ laundry must look like on Mondays, and their houses on every day of the week. The Municipality itself cannot really do anything about this state of affairs. Now I should like to ask the hon. the Minister and his Department to give attention to this matter. I also want to ask that attention should be given to the principle involved here, and that planning as regards the building of houses for Railwaymen should in future provide for their being built within the municipal area and amongst the other houses, so that these people will become part of the community. If that is done, it will be easier for them to be assimilated by the community, and not to be stamped as people who are different from the inhabitants of the rest of the town.

The second matter I want to bring to the hon. the Minister’s notice is the question of relief station masters. I do not want to cast any reflections, and what I want to say I say in all humility. At present the position as regards relief station masters is that they are divided into certain grades, and then have to relieve at stations where their services are required. It now happens that a Grade A station master has to be relieved at a certain station by a relief station master who is one or two grades lower in rank. These relief station masters are expected to bear the same responsibilities as the station master who is stationed there, although the latter may be one or two grades higher in rank. The responsibility remains the same. Over and above this aspect of responsibility—except that he now receives a subsistence allowance, such a relief station master is not compensated for the fact that he is relieving at a station of which the station master carries a higher rank than his own. He receives no compensation for the difference between his basic salary and that of the permanent station master. In some cases where relief work was done for three months and longer, it was found that the difference in salaries amounted to R1,200 to R1,400. In such cases the Administration makes no adjustment in salaries. I now want to ask the hon. the Minister whether such an adjustment cannot in fact be made. At the same time I want to plead in advance that the reverse should not be done, i.e. in cases where senior relief station masters are sent to junior stations. I do not want their salaries to be tampered with and reduced. As far as I know, it actually happens more frequently that junior men have to relieve at senior stations.

These were the two matters, Mr. Chairman, which I wanted to raise. In addition, I just want to say that as a result of the sympathetic treatment they have always received from the hon. the Minister and his Department, the people of Vryheid have no complaints. We do not have the complaints about which the hon. members on the opposite side make such a fuss. Where complaints do in fact arise, they are complaints of an individual nature, which would have arisen under any circumstances, and not necessarily under Railway circumstances. In general, we are therefore fairly contented; much more contented, in any event, than we would have been if we bad had a United Party Administration over us.

Mr. C. BENNET:

Mr. Chairman, there are one or two local matters affecting my constituency which I should like to bring to the hon. the Minister’s attention. The first concerns the question of the provision of a subway to eliminate a level-crossing in Grahamstown. This is a level-crossing over which the road, which is the only way of access to the local hospital, passes. The local hospital board has for years made representations on this subject, but these representations have been turned down by the Administration on the grounds that the road traffic over this crossing was not heavy enough to justify the elimination of the crossing. Not only is this the only way of access to the local hospital, but it also gives access to what is the new housing estate which is expanding. The hospital itself does not merely serve one district, but four districts, namely, the districts of Albany, Peddie, Bathurst and Alexandria. Apart from the nuisance caused to patients in the hospital by the train having to whistle before approaching the crossing, the grading between the station and the crossing is such that sometimes engines with heavy loads cannot negotiate the gradient. They therefore come to a standstill on the crossing and have to wait for another engine to be sent up from the station before they can proceed. It has happened in the past that, while a train is in that position, doctors on their way to the hospital attending to urgent cases and also ambulances carrying patients to the hospital, have been delayed. And, Mr. Chairman, it can very well happen on some future occasion that such a delay could cause the death of a patient in the hospital on account of a doctor not being able to reach him in time, or of a patient in an ambulance.

The MINISTER OF TRANSPORT:

Where is that crossing?

Mr. C. BENNET:

It is the crossing in Milner Street, Grahamstown. I should also like to point out to the hon. the Minister that it is planned that a new hospital should be built near the present site—a new hospital costing R1,000,000 and consisting of seven stories—but that the traffic to the new hospital will also have to use this crossing. The present hospital will remain and will be used for non-Whites. Among the inmates of the new hospital will be the chronic sick and aged who are at present inmates of a special hospital for the chronic sick in Grahamstown. I hope that the hon. the Minister will see his way clear to deviate in this particular instance from the present policy of providing subways only on the grounds of a sufficient traffic count.

The second question I want to raise, Mr. Chairman, is that of the provision of railway housing in Grahamstown. As the hon. the Minister knows improvements and alterations are being carried out at the Grahamstown station. As a result of these improvements, certain members of the Railway staff are being transferred from Alicedale to Grahamstown. According to my information, there are at the moment only four Railway houses in Grahamstown. In this town there is a rather severe housing shortage. As a result of the various educational institutions, the town has a very large floating population. Although it is easy to buy houses in the town, it is very difficult to rent them. The Railway personnel who are stationed in Grahamstown, find this housing problem an extremely difficult one. I trust that in this instance the hon. Minister will be able to give sympathetic consideration to the needs of these people.

*The MINISTER OF TRANSPORT:

Mr. Chairman, at this stage I want to dispose of the numerous matters mentioned by hon. members. In about 90 per cent of the speeches, concessions which would entail increased expenditure were asked for. And that in spite of the previous two days’ debate, where as a result of the increased expenditures certain tariff increases had to be introduced. The expenditures were both revenue and capital expenditures. I should have liked to do everything which the hon. members asked me to do, but I am afraid that the capital which is placed at my disposal is very limited. Naturally the capital must be utilized for the most essential improvements and the provision of certain facilities. It is useless spending money on things which are desirable but which are not essential. We cannot allow any lack of the necessary transport facilities to continue. That is the reason why I cannot comply with many of the requests which are fair and which are also desirable.

As far as the complaints made by the hon. member for Yeoville that I had supposedly been so personal are concerned, I just want to say that I went through my speech very carefully this morning and could find nothing in it to show that I had been personal.

Mr. W. V. RAW:

You have strange standards.

*The MINISTER:

What I did do was to scoff at the hon. member a little. I also told him that he must make sure of his facts, and that he had made certain statements that were not true. I do not know in what other way I should put it, since that was actually the case. I objected to certain untrue statements. The hon. member will have to admit that those statements were untrue. The reason why I referred to the amount of R49,500,000 was that the hon. member had mentioned that amount and that amount alone in the first part of his speech and had sent it out into the world. It was only in the second part of his speech that he mentioned the amount of R46,500,000. The day he replied, however, he only referred to the amount of R49,500,000 for tariff increases. The reason why I drew attention to the matter was precisely because the hon. member had on that occasion omitted to say that the net tariff increases were actually R46,500,000.

*Mr. S. J. M. STEYN:

You are making it much worse now.

*The MINISTER:

No, that is the position. As far as the Schumann Commission is concerned, the hon. member definitely alleged that I had used that commission as an excuse to introduce general tariff increases.

*Mr. S. J. M. STEYN:

That is still my opinion.

*The MINISTER:

That is incorrect and untrue.

*Mr. S. J. M. STEYN:

It is not untrue.

*The MINISTER:

It is. The hon. member and I differ in this connection. The hon. member says that that is his opinion, and I say that it is quite untrue.

*Mr. S. J. M. STEYN:

It is not a question of facts. It is a question of inference.

*The MINISTER:

I say it is completely untrue.

*Mr. S. J. M. STEYN:

You have no right to say that it is untrue.

*The MINISTER:

I adhere to my point of view that it is an untruth. As far as the other allegation which the hon. member made in connection with 1962 is concerned, is that also the truth? Does the hon. member also adhere to his opinion in that case?

*Mr. S. J. M. STEYN:

I cited my authority for that and the Minister knows it.

*The MINISTER:

The hon. member did not cite any authority.

*Mr. S. J. M. STEYN:

I have my Hansard here.

*The MINISTER:

The hon. member must read his speech again, since he has apparently forgotten what he said. In any case I do not want to repeat the previous debate. The hon. member is trying to defend himself, but it is a very poor defence.

*Mr. S. J. M. STEYN:

It is a very poor attack.

*The MINISTER:

As regards the other matters which the hon. member mentioned, he made a few good suggestions. As far as accidents are concerned, I want to say that I agree with the hon. member that it is alarming when there is an increase in the accident rate and when accidents occur which not only involve loss of life, but also injuries to people and serious damage to material and to the railway line which runs into tremendous amounts. The hon. member referred to an article which has. appeared in the Frankfurter Zeitung. The Management has informed me that they already have this article in their possession and that the matter is receiving attention. Personally I am of the opinion that there is a great deal of truth in the statements made in this article. I am convinced that an accident is often due to the psychological state of the person responsible for the accident.

*Mr. S. J. M. STEYN:

It is the human element.

*The MINISTER:

Yes. The Railways has built up a very good safety organization. This organization consists of persons who are trained as experts in the field of safety. A few years ago I sent the head of that organization overseas to investigate organizations for the prevention of accidents in other countries. He submitted a fairly comprehensive report, and we are trying to act in accordance with that report.

I have laid down that in the case of an accident an investigation must be made into the domestic circumstances of the person responsible for the accident. I am convinced that a train driver who has to contend with unfortunate domestic circumstances reports for duty in such a disturbed frame of mind that he becomes accident-prone, and that it is much easier for him to cause an accident. Similar matters are being investigated at the moment. I can assure the hon. member that everything, is being done to make our railway staff safety-conscious, to try and prevent accidents and to carry out the necessary investigations in order to determine the causes—physical or mental—of any particular accident. However, it would appear, just as in the case of motor accidents, that the number of train accidents is increasing year after year. What the hon. member said in connection with the Japanese railway system is quite correct. Compared with other railway systems, the percentage of accidents on the Japanese railway system is just about the lowest in the world. A few years ago I sent a special mission to Japan which, inter alia, went into this matter. That mission made certain important recommendations which were accepted by the Railways. As regards train accidents in which Bantu assaulted the train staff, I do not believe that those attacks were due to any hostile feelings existing between the Bantu of those areas and the Whites. Such a case occurred at Effingham, where one of the railway officials was killed after the accident had occurred. I do not believe that such actions are due to an inherent hostile feeling on the part of the Bantu towards the Whites. In my opinion such deeds are more the result of the psychological outlook of the Bantu. For instance, it has been found that Bantu have acted in a similar way when members of their own race were responsible for the accident. There has been a case where a Bantu bus driver was assaulted by his fellow Bantu after an accident. Only this morning I received information on two typical cases which support my statement. On 28th February, 1966, a bus carrying Bantu passengers departed from Gezubuso, which is approximately 20 miles from Pietermaritzburg. The bus overturned and rolled down an embankment. Two passengers were killed and 15 injured. The Bantu driver was injured, and while he was being carried to the ambulance, approximately 200 Bantu threatened to stone him. They wanted to assault him.

*Mr. S. J. M. STEYN:

Did they, or did they only threaten to do so?

*The MINISTER:

They threatened to do so, but a Bantu minister prevented the Bantu from throwing stones. That is one item of proof; although the driver was a member of their own race, they wanted to assault him. Here is another case.

On 8th October, 1965, after a collision had occurred between a Bantu passenger bus and a passenger train at a level crossing near West-onaria, Bantu passengers in the bus threw stones at the Bantu driver. The White ticket-examiner on the train approached them and asked them to stop their stone-throwing, which they then did. In this case the White ticketexaminer on the train asked them to stop their stone-throwing and they did so, but they had assaulted a member of their own race. The Management informs me that this was mentioned in the report submitted by the White ticket-examiner, but the Bantu said nothing about it. In the days before the removal of Sophiatown and Martindale, the hon. member knows that whenever an accident occurred, if a motor-car ran over a Bantu, even though the driver was a Bantu, then stones were hurled at him and he was assaulted. It seems to me that it is simply the nature of the Bantu. He gets excited when anything of this nature occurs and the first person he comes across has to suffer. He regards that person as being responsible and then assaults him. I therefore do not think that it is due to a feeling of hostility which has arisen between the Whites and the Bantu. We naturally afford the train staff as much protection as possible.

The hon. member—and I am not going to exploit this matter for political gain, because it is such a serious one that one listens eagerly to any suggestion and, if it is a practicable one, accepts it—spoke of the possibility of changing the train staff. It may perhaps lead to that eventually if the White train staff are no longer prepared to work on those trains, but at this stage it will be quite unacceptable to the White staff. It would establish a new principle, i.e. that one employs Bantu as locomotive drivers and that one employs Bantu as ticket-examiners, although we are already employing them on the stations as ticket clippers. I am quite convinced that at this stage that would be totally unacceptable to the staff.

*Mr. G. J. KNOBEL:

And the conductors.

*The MINISTER:

As far as the principle is concerned, it is a generally accepted principle that, in so far as it is practicable, Bantu should be served by their own people, and that is why this is already being done on the stations in those Bantu areas. There we have Bantu clerks. At major stations where services have to be rendered to many Bantu, Bantu ticket-clerks have already been appointed, but as far as the train staff is concerned, this has not been done. At this stage, as I have said, it will be quite unacceptable to the staff.

*Mr. S. J. M. STEYN:

Are you going to afford the Whites more protection now?

*The MINISTER:

Yes, in the first instance we are considering providing them with radio sets in their drivers’ cabins; in that way they can get in touch with stations immediately if an accident occurs. They are also getting police protection. In addition, wire screens are being fitted to their cabins to protect them against stones, etc. All the necessary steps are therefore being taken in order to afford them the necessary protection.

The hon. member asked that clerks at stations who may now have to work a great deal of overtime as a result of the introduction of the increased tariffs should receive compensation for doing so. That is not being done. It is being maintained that, particularly on this occasion, where an entirely new tariff book has been put into operation, the work is actually less than what it usually is when adjustments and alterations in tariffs take place.

I was myself a station clerk in my day, and the station clerk has time in between when he can give attention to that work. It is expected of him to do that work, which is for his own benefit and which assists him in the execution of his duties. The hon. member mentioned the cases where Railway servants applied for leave and where there were long delays before they heard whether or not they could get their leave. He said that it sometimes happened that a Railway servant was suddenly notified on a Friday that he had to take his leave from Monday. I think that is quite wrong. I think all servants applying for leave ought to be notified in good time, where that is at all possible, and I shall ask the Management to go into this matter. It is impossible for a man to go on leave with a week-end’s notice, particularly when he has a family and perhaps wants to go somewhere else for his holiday.

As far as the promotion of clerks at outlying stations is concerned, they have the same opportunity of being nominated for any post which may become vacant in the System Manager’s Office. They also have the right to apply for transfer to the System Manager’s Office if any vacancies occur. They are, in fact, sometimes transferred, but one of the difficulties is that when such vacancies arise, that station clerk often does not satisfy the requirements. I personally believe that, as far as it is practicable, the servant should be enabled to gain very wide experience and where it is possible he should not be kept in one particular department for his entire career, because promotions are naturally much quicker in certain departments than they are in other departments. It is often impossible to do that, but I want to assure the hon. member that it is being done where it is in any way possible, and these applications receive sympathetic consideration by the Management.

The hon. member for Transkei again raised the matter of the Transkei allowance. He said that it had come to his attention that members of the Audit Department who are not seconded to the Transkeian Government receive this special allowance. I checked that this morning and that is the position. I have been informed by the Department of Finance that in view of their close association with the Department of Finance of the Transkei Government, it was decided to station them in the territory and to pay them the relevant allowances. I do not agree with this and I am going to raise the matter with the Minister of Finance, because the principle has been that only those servants who have been seconded to the Transkei Government receive this allowance, and it is not because they suffer disabilities. Those stationed in Zululand and other outlying places suffer the same disabilities as a railwayman stationed in the Transkei and there is no earthly reason why the railwayman in the Transkei should receive this allowance while the railwayman stationed in Zululand does not receive it.

Mr. T. G. HUGHES:

Why do they get it in South West Africa?

The MINISTER:

The South West Africa allowance was introduced in 1924. It was introduced mainly because the cost of living in South West Africa at that time was very much higher than in the Union. It has become a vested right and that is why they are still receiving it to-day.

The hon. member for Salt River spoke about the dilapidated railway premises and the roads at Vaarsche Drift. In regard to railway premises the position is that a certain amount is placed on the Estimates for maintenance and repairs and then there is a method of maintenance that we call systematic maintenance; in other words, at fixed periods all the buildings and houses are renovated or painted or repaired, but here again it is a question of shortage of funds and a shortage of man power, and even in spite of the fact that very often we employ contractors to do this work, some of the work remains in abeyance and is not done when it should really be done.

*The hon. member for Marico spoke about the hours of duty of station foremen. As I have already written to him, the hours of duty of station foremen are determined on a certain basis, i.e. the intensity of trains on those sections, and then certain other factors are also taken into consideration, but it is the intention eventually to reduce all shifts to eight-hour shifts. In view of the expenditure and the shortage of manpower, however, it cannot be done at this stage.

The hon. member for Umlazi spoke about the air pollution in Durban caused by shunting engines. It is the intention eventually to replace the steam shunting engines with Diesel locomotives, but that can only be done when the capital becomes available. At the present time there is no capital available for this purpose.

Mr. H. LEWIS:

How long is it going to take?

The MINISTER:

It all depends on when the capital becomes available. There is no capital available at the present time so I am afraid the people of Durban will have to continue for some time to put up with air pollution. I want to replace the steam engines with Diesels, but I will have to wait until I can afford to do so. As far as the road leading to the new pier is concerned, I am informed by the Management that that road will be repaired, but they are having consultations or will have consultations with the Durban Corporation. I am informed that provision has been made in the Salisbury Island project for a road to serve the Salisbury Island-Island View complex and to connect it with Durban. There have already been negotiations with the Durban Municipality in regard to the financial contribution to be made by the Municipality, but it appears that the Municipality is not inclined to make any financial contribution to the building of that road. The road will only be built when the amount of traffic justifies the building of the road.

Mr. H. LEWIS:

That was about ten years ago.

The MINISTER:

Apparently it is not yet justified. In regard to the complaints about noises caused by shunting at Fynnlands, the position is that the Fynnlands yard is being used for shunting mainly between six o’clock in the morning and six o’clock in the evening.

Mr. H. LEWIS:

And all night.

The MINISTER:

Only block loads are pulled out there during the night. I am afraid that the people in the immediate vicinity will simply have to adapt themselves to the noise because it is quite impracticable to build a hump yard at Fynnlands. We have a hump yard at the Bayhead yard but you cannot build it at Fynnlands.

Mr. H. LEWIS:

Could you not put a better class of locomotive there?

The MINISTER:

No, those are the only locomotives that are available. Then the hon. member wants to know whether the remaining roads will be electrified. No, they will not be electrified at the moment because we have not got so many electric shunting locomotives that we can use them for that particular purpose.

Mr. H. LEWIS:

Cannot you transfer them from the Bay heads?

The MINISTER:

No, we do not have sufficient.

*I just want to congratulate the hon. member for Pretoria District on the maiden speech he made here. We all listened to it attentively.

The hon. member for Berea spoke about speedometers on locomotives. I can give him the assurance that the drivers can estimate their speeds fairly accurately. After driving over a particular section for a number of years the driver knows precisely on what curve he must slow down; he knows precisely how fast to go, even without a speedometer, between stations, and in saying this I speak from experience. In my days there was no such thing as speedometers on locomotives, but you did not have more accidents as a result of speed in those days than you have to-day with speedometers on locomotives.

Mr. S. J. M. STEYN:

You had so many fewer trains.

The MINISTER:

The fact that there were fewer trains has nothing to do with the speedometer. The speedometer is merely there to tell you what the speed of the train is, and in spite of speedometers you find that there are still derailments as a result of speed. Speedometers, as I told the hon. member in my reply, are, however, being fitted to all the locomotives and everything is being done to keep them in good order.

The hon. member suggested that accidents might be due to the long hours of duty. I receive reports concerning all serious accidents, and every report also mentions the number of hours that that particular servant had been on duty and the period of rest that he had before going on duty. I can give the hon. member the assurance that on the whole it is not as the result of long hours of duty that these accidents take place; there are many other causes.

*The hon. member for Wolmaransstad also mentioned the houses at Womaransstad that needed plastering and painting, and the long delay that occurred in that connection. Sometimes that happens for the reasons I have already mentioned, but the Management assures me that every effort is made to carry out that kind of work as soon as possible.

As regards the electric lights at Ottosdal, I just want to say that provision for supplying power and electric lighting at certain stations is made every year; all of them cannot be dealt with simultaneously. A priority list has been drawn up and work is done strictly according to that list. I do not know what Ottosdal’s position on the priority list is, but if the hon. member inquires at my office, I shall be able to tell him.

The hon. member for Durban (Central) spoke about the plight of ex-senior officers who are pensioners and he discussed the temporary allowance paid to pensioners. He also suggested that the means test should be abolished. That is what it amounted to. He also suggested that if it is not abolished those pensioners who are employed by private undertakings should be treated in the same way as pensioners who are re-employed by the Railways. In regard to the increase in these allowances the position is that every increase entails a considerable outlay. I am very sympathetic towards these pensioners and I am always prepared to increase their allowances when the finances permit it. As far as the means test is concerned, the ceiling cannot be increased at the present time because that is a matter for joint action between the Civil Service and the Railway Administration. There is uniformity in regard to the means test. There are many objections to the raising of the ceiling or the elimination of the means test. The majority of railway servants receive less than R150 per month in basic wages and R150 is the limit of the means test. The servants who are in receipt of pensions exceeding R150 constitute a minority in the Railway Service but they constitute a fair majority in the Civil Service. It is merely a question of cost again. The reason why I decided that any pensioner who is re-employed by the Railways should not lose his allowance, or that his wages should not be taken into account for the purposes of the means test, is that I wanted that to act as an inducement to Railway pensioners to re-enter the Railway service and thus alleviate the staff shortage. That was the reason and that is why it is only applicable to pensioners who are re-employed by the Railways. The same applies to Civil Service pensioners who are re-employed by the Central Government.

Mr. S. J. M. STEYN:

What is the position of the Railway servant who wants to come back to the Railways but cannot be accommodated?

The MINISTER:

The hon. member for Umbilo also raised that matter.

Dr. A. RADFORD:

I can well understand the hon. the Minister wanting to induce e×Railwaymen to come back to the Railway service, but the railwayman who goes and works for the Civil Service still enjoys this advantage.

The MINISTER:

Yes, but then the Civil Service pays the allowance, not the Railways. If he is an ex-railwayman and he is reemployed by the Civil Service, then the Treasury has to pay the allowance, not the Railways, and vice versa. As I say, this was introduced as an inducement to get these people back into our service. The hon. member for Umbilo wanted to know whether there were sufficient vacant posts for all Railway pensioners who want to come back to the Railway service. I do not think that there are sufficient posts available for all pensioners. In certain departments there is no shortage. It all depends on where these vacancies actually are. For instance, in the Western Cape there are very few vacancies. In certain grades we have waiting lists of people who apply for employment. In other parts, like Natal, there is again a severe shortage in most of the grades. And then it depends on the pensioner’s physical condition whether he can still do a day’s work. All those matters must be taken into consideration and consequently all the pensioners who want to be re-employed are not re-employed. On the whole there are not sufficient vacancies for them all to be re-employed.

Mr. S. J. M. STEYN:

What happens when they go and work outside?

The MINISTER:

Then they are subject to the means test.

Mr. S. J. M. STEYN:

Then there is something wrong.

The MINISTER:

No, I told you why it was done. I am concerned with the manpower shortage on the Railways, and to giving an inducement to these pensioners to come back to my service. That is why their earnings are not taken into consideration.

I want to congratulate the hon. member for Maitland on his maiden speech. He pleaded for the building of an additional subway at Maitland station. If the money is available, I can give the assurance that that subway will be built. With regard to the housing for Railway workers at Maitland, I can only say again that only limited capital prevents me from providing all the houses necessary. A certain amount is allocated for housing every year, but whether any houses in Maitland itself will be built, I cannot tell him at the moment.

A case was mentioned by the hon. member for Pietermaritzburg (City), namely that a young man employed as a casual joined the Railway Service and had to undergo his military training, and on his return he did not receive the difference between his military pay and his Railway pay. It is quite right that that is applicable to casual servants. They can leave or be discharged from day to day. It is only those servants who are in temporary and permanent employment who receive the full difference between their military and their Railway pay. I understand, if this is the case the hon. member referred to, that this young man was not employed by the Railways in a temporary capacity as the result of a medical report. But I do not know whether that is the case the hon. member referred to. If he gives me the name I can go into it. I can also tell the hon. member that few fit and qualified young men are employed in a casual capacity; they are usually employed in a temporary capacity with a view to placing them in permanent employment after a certain period.

Capt. W. J. B. SMITH:

The point here is that he had to sign a guarantee that he would return after completing his military service. I do not understand that, because surely the others do not have to sign such a guarantee.

The MINISTER:

If the hon. member gives me the name of that servant, I will go into the matter and let him know.

*The hon. member for Moorreesburg asked for a rail link between Vredenburg and Berg River. As the hon. member knows, new railway lines are nowadays built only for departmental reasons if their building is justified economically or if it is guaranteed against losses. I do not know what the position is there. If a guarantee can be given such a line will be built, and if the parties involved make the necessary application and are prepared to guarantee any losses, I can assure the hon. member that such a line will be built. As regards the station at Saldanha, which he asked should be moved, that can be investigated.

With regard to the new railway station at Durban, I can only tell the hon. member for Umbilo that I am afraid the public of Durban will still have to exercise considerable patience. This station will only be built when the necessary capital is available and I do not think that capital will be available in the near future. It is not on the priority list because stations of the size of that new station at Durban are not put on the priority list because there are no other large stations that Durban Station has to compete with. It is simply a matter of finance, whether the capital is available or not. After listening to my colleague’s Budget to-day I think the hon. member will agree that the capital will not be available very soon.

*The hon. the Deputy Minister for South West Africa Affairs asked whether provision could not be made for lighter clothing for the officials. That is being done. As regards the dress of certain grades it has already been decided that they will now be provided with summer and winter clothing, and that will be extended gradually.

The hon. member for Aliwal asked for a new goods shed at Matatiele. That again is a question of capital expenditure. As soon as the money is available, it will be built. He spoke about the Railway houses that were not in a good condition. The Management will go into that, but it is a question of whether the manpower is available and whether the necessary money has already been voted for that. But I quite agree that one cannot allow these houses to become dilapidated to the point where decent people cannot live in them. The Management will give attention to the matter. The hon. member asked that the running staff at Aliwal should not be transferred to Burgers-dorp. I do not know whether there will be any transfers. The matter has not yet come to my attention, but I shall inquire into the position. I do not know whether there is any good reason why they may have to be transferred, but as a result of the electrification of a line or the introduction of Diesels it often happens that personnel have to be transferred. We have had the case of Volksrust, where a large number of servants had to be transferred as a result of the introduction of electrification. It is sometimes unavoidable.

The hon. member for Mooi River asked for additional facilities for the station at High Flats. The hon. member knows that certain improvements are being made to the Donnybrook line. The position at High Flats has not been brought to my attention, but if it is absolutely essential that certain additional facilities should be provided, I shall ask the Management to go into the matter.

The hon. member for Vryheid asked that the streets between the houses should be improved. I shall ask the Management to go into that. Then he asked that the houses to be built in future should be built within municipal areas. Since I became Minister, it has been my policy not to establish Railway camps, but to distribute Railway houses in a city or town. That is being done, and very fine houses are being built within municipal areas, where possible, because if they are built outside the municipal area, then I am naturally responsible for the provision of water and power, while if they fall within the municipal area, then the municipality has to provide those. Wherever possible, and provided that land is available, it is therefore the policy to build within the municipal area.

As regards relief station masters, that has always been the position. If a man relieves at a large station he gains valuable experience, but if I had to pay him a higher remuneration because he is relieving at a higher-graded station, the opposite would also have to apply and he would have to be paid less if he relieved at a lower-graded station.

The hon. member for Albany spoke about the crossing at Grahamstown. I do not know whether he asked that the crossing should be eliminated. As the hon. member knows, there is a standing committee that deals with these matters, and they have a priority list. I do not know whether that crossing is on that list, but the hon. member may inquire at my office and he will probably get the information. There are certain basic requirements before a crossing is eliminated. It depends on the intensity of the traffic, and the danger elements and quite a few other factors are also taken into consideration. If the hon. member inquired at my office, they could tell him what position that crossing holds on the priority list.

Mr. W. V. RAW:

The gesture the Minister has just made in tearing up his notes and throwing on the floor the problems of the constituencies is part of the price we are paying for the situation discussed earlier in this debate. To the disappointment of my friends here, who thought I was running away from my interjection, the interjection which the Minister did not catch was that we would probably have to wait a lot longer for the capital after what this Minister’s Budget has done to the steps taken by his colleagues to combat inflation; and that was the answer we got this afternoon to all the appeals—cold comfort for those who are waiting for long-term and major services from the Minister. [Interjection.] Yes, we have a hot climate in Durban, but there is very little comfort for anyone in response to any of the matters raised on behalf of the people of Durban. And it is a pretty hot climate for the Railway workers too, working in those dilapidated and prehistoric stations. But those hon. members do not care and the Minister gives us no comfort. He says that in view of the Budget to which we listened this afternoon it is unlikely that we can expect any relief for a long time. So I say that the Minister’s gesture in tearing up the problems raised by members on both sides of the House is appropriate.

I want to raise one or two matters, but before doing so there are two points in the Minister’s reply which struck me particularly. The first is that there must be something seriously wrong in the Railways if a person is unfit for Railway service yet is fit for military service. That seems an incredible state of affairs, that a person is fit enough to be a soldier, which is a physically demanding occupation which requires a high degree of fitness, and yet, according to the Minister, he was probably unfit for the Railway service. I would suggest that there is something wrong with either the one or the other of the medical examinations.

In regard to shunting, I want to put it to the Minister that this is not something you can just shrug off and say that the people must adapt themselves. With the housing shortages, people cannot pick and choose where they will live and how close they will be to shunting-yards. In regard to my own constituency, I put a question to the Minister about the shunting in the Point docks which creates a tremendous amount of noise in probably the most heavily populated area in Durban. In his reply the Minister pointed out that shunting is continuous except from 9 a.m. on Sundays to 10 p.m. on Sundays, and even then, if necessary, shunting takes place. In other words, for 24 hours a day 12 steam locomotives all day and 10 all night shunt continuously, for seven days of the week, in an area containing the biggest hospital in Durban and the biggest concentration of residents.

An HON. MEMBER:

The hospital was probably wrongly sited.

Mr. W. V. RAW:

The hospital was there before there was a railway line, and that has been there for over 100 years. The first railway line ever built was at the Point, and the hospital has been there longer. Now I realize the Minister’s problem. He cannot just suddenly get diesel locomotives, but what I feel is wrong is the Minister’s shrugging of his shoulders and his demand that the people will have to adapt themselves. Surely this is something which can receive some attention. Can nothing be done about it, except that people must adapt themselves? Can nothing be done to organize the hours so that at least in the early hours of the night there can be an opportunity for people to get a few hours’ sleep? Is there no way of so arranging things that the volume of noise can be reduced? The Minister says no, they must adapt themselves. I do not think that is a fair answer, and we cannot let that answer pass without comment.

In reply to the appeals made from this side of the House regarding pensioners, the Minister has said that there is nothing he can do. I would again like to put to the Minister a suggestion made by me some years ago. In regard to pensioners under the old pension scheme who do not enjoy the travelling privileges of those under the new scheme, I have been approached by a number of these old-scheme pensioners, asking whether it would not be possible for them, in valley periods, when there is space on the train and there is no overcrowding, to enjoy the same facilities as pensioners under the new scheme. This would cost the Administration nothing; it would in fact bring in money, because if they were occupying empty compartments and paying their part towards the fare and thereby making a contribution it would be something that the Railways would be getting which they would otherwise not be getting. At the same time it would be giving these old pensioners the opportunity which some of them never enjoy of seeing their families in other parts of the country. I ask whether that could not be considered.

One other point I raised with the Minister by way of question is the matter of the signalling system on the North Coast line. The Minister said he was replacing the mechanical signalling by colour-light signalling. My information is—and that is not reflected in the reply—that this new colour-light signalling is still in the process of being installed and now with the electrification of the line it has to be replaced by a different type of equipment. It seems to me that this is one of the examples where lack of foresight is costing the Administration money, and I raise it here not in isolation but as an example of the need for perhaps greater care in looking ahead and in spending money. My information might not be correct, but it is that a new colour-light system is still in the process of being installed, and now it all has to be taken out or modified after costing R36,000 because of the electrification. These are ways in which savings can be effected and I bring it to the Minister’s notice as an example.

*Mr. P. H. MEYER:

Mr. Chairman, when a newcomer comes to this House for the first time, he has the feeling that he will get a very cold reception here. It was with such a feeling then that I and other newcomers made our entry into this House. However, just as cold as we feared our reception would be, so warm was the friendliness with which we were received in this House. We owe you, Mr. Chairman, and older members of this House a great debt of gratitude for that. You have made us feel at home amongst you.

I represent a constituency in which many Railway people are living, some who are still working for the S.A. Railways and others who have already retired on pension. I should like to express my gratitude towards the local officials of the S.A. Railways for their helpfulness whenever it is necessary to see them about some matter or other. That facilitates our task as representatives and, as far as I am concerned, I appreciate very highly the manner in which they have always given me a hearing.

In the Budget of the hon. the Minister of Finance this afternoon, we once again had to take note of the fact that there are inflationary tendencies in our country which we must counteract. It has been pointed out time and again that one of the major causes of that is the fact that sufficient man-power is not available for doing the work that has to be done. As a result there is a tendency for salaries and wages to rise. It is against the background of these inflationary tendencies and this man-power shortage that I want to break a lance for our Railway pensioners on this occasion. A married pensioner with an income not exceeding R150 is entitled to a temporary allowance of R35 provided that the addition of that R35 does not bring his total monthly income to more than R150. That applies to married persons. For unmarried persons the amount is R75. Unfortunately it so happens that many of these people are forced to take up employment again owing to the meagreness of their income and the fact that, in many cases, they still have children to support. It is the policy of the Railway Administration to take into consideration the income such a person earns in this manner when it has to be decided whether or not he should receive the temporary allowance of R35. As a result many of them lose this allowance owing to the size of their income. My object to-day is to plead for a revision of this policy. I am aware of the fact that the policy has already been changed in such a way that where those people are reemployed by the S.A. Railways, the income they earn there does not affect their allowance. In general these pensioners are all elderly people who have very little to fall back upon when illness or other setbacks occur in their families. For that reason all of them want to make provision for the time when they may be faced with an emergency. Their pension is usually very small, and that is an indication that their income was never very high while they were working. As I have said, there are in my constituency, and I believe in many others, some pensioners who, apart from their wives, still have minor children to support. All of them are not fortunate enough to be re-employed by the S.A. Railways. They cannot be considered for the positions vacant at a given time.

I want to plead that the policy of the S.A. Railways in regard to the payment of this allowance should be reviewed, particularly against the background of the existing manpower shortage. Another consideration is added to that, namely that for each White pensioner employed in this manner, one non-White labourer less is required. Most of these White pensioners are accustomed to manual labour, labour which will be performed by non-Whites if they themselves cannot do it. In view of all these considerations, I once again want to plead with the Minister to reconsider this policy in respect of our pensioners, even if he does not do so immediately, and to see whether it is not possible to permit them to take up employment outside the S.A. Railways without prejudicing themselves in doing so. Provision has in fact already been made on the Estimates for the payment of this allowance to pensioners, and for that reason what I am pleading for will not have any major adverse effect on the finances of the S.A. Railways. I think the hon. the Minister is capable of finding a solution to this problem. It is not my intention that my plea should also apply to money in respect of other forms of income they may have, income such as rent, interest on legacies, and so forth.

Mr. L. E. D. WINCHESTER:

Mr. Chairman, I want to congratulate the hon. member for Vasco on his maiden speech. I wish him luck in the years to come. He said he was cold on his arrival here but I can assure him that by the time he has to make his second speech he will have warmed up. I also want to congratulate him for siding with this side of the House in our appeal to the hon. the Minister for a better deal for Railway pensioners. I can only hope that the hon. the Minister will take more notice of him than he has taken of us.

I want to appeal to the hon. the Minister on behalf of the five private clubs on Salisbury Island. These clubs had to move on account of the developments taking place on Salisbury Island in recent months and are now occupying temporary sites. They appreciate the position but would like me to appeal to the hon. Minister to ensure that their transfer to a permanent site is expedited.

*Dr. J. A. COETZEE:

Mr. Chairman, Section 103 of our Constitution provides that the railways, ports and harbours of the Republic shall be administered on business principles. One of the requirements imposed by the Constitution in this regard is, therefore, that the staff of the S.A. Railways shall be paid reasonable salaries and wages. No undertaking can make a success of its affairs unless it pays reasonable salaries to its staff. It goes without saying that this is a principle which applies to the S.A. Railways too. The only means by which the S.A. Railways can pay its staff reasonable salaries, in the same way as other businesses pay their staffs reasonable salaries, is to increase tariffs and fares slightly. It should be remembered that an increase in tariffs and fares is not taxation but higher remuneration for services rendered. We should discard the notion that that amounts to a form of taxation imposed upon the public. The Opposition’s attacks on the hon. the Minister’s Budget therefore amount to an attack on the increase in the salaries and wages of the staff. If anybody should receive good salaries, it should be the staff of the S.A. Railways, Harbours and Airways. They make great sacrifices, which are coupled to a certain extent with the disruption of their domestic life. We can speak of their services only with the highest praise and with pride.

If there is one thing the staff of the S.A. Railways is still in great need of at present, it is more houses. The hon. the Minister said that if the funds to do so were at his disposal, he would provide more houses. It is our task to find ways and means of making those funds available. It is absolutely essential that more houses should be made available to the railwaymen. In this regard I want to refer in particular to members of the Airways staff who are stationed at Kempton Park. They are experiencing a great shortage of housing there. There, as elsewhere, they also have to compete with each other according to the method of awarding marks. A certain official may obtain a house on account of the fact that he has more marks because he has more children than the others, for example, or because he has more years of service there, etc. The system therefore amounts to one man’s gain being another man’s loss. That is not a healthy state of affairs, and it should be put right. We shall try to help the hon. the Minister to get the necessary funds for that purpose. We must put our heads together.

In conclusion I want to refer again to something I mentioned in my maiden speech, namely the fact that the Airways tickets from Kempton Park to Cape Town are worded as though they are for a journey between Johannesburg and Cape Town. Kempton Park is Kempton Park, and the airport is in Kempton Park. I therefore do not travel from Johannesburg to Cape Town, but from Kempton Park to Cape Town. I shall simply have to keep on raising this matter until it has been put right.

The MINISTER OF TRANSPORT:

Mr. Chairman, I am inquiring into the matters raised by the hon. member for Durban (Point). He talked about colour signals that must be replaced. If I do not have an opportunity to reply to him in the course of this debate, I shall do so during the second-reading debate, if he again raises that matter. I dealt with Railway pensioners previously. I was asked what the position was regarding the travelling privileges of pensioners under the old scheme. I cannot remember what reply I gave at that time. I think we have a very good reason for not granting these travelling facilities. I will go into the matter, though, and let the hon. member know what the position is.

*I want to congratulate the hon. member for Vasco on his maiden speech. As is expected of him, the hon. member quite rightly pleaded for his constituents, and especially for the pensioners. He also asked that the means test should be either raised or abolished. Now, apart from the expenditure involved, there are very strong objections in principle to the abolition of the means test. If this test is abolished for Railway pensioners, it will also have to be abolished in respect of old age pensioners, because what justification would there be for subjecting the old person who has another source of income to the test while the Railway pensioners are not subjected to the test? As I previously told another hon. member, the majority of Railway workers receive a basic monthly wage of less than R150. For that reason the means test of R150 is not too low a figure. The basic wage of the grades such as shunters and ticket-examiners is less than R150 per month. What I have done in the past was to help those pensioners who were having the hardest time. For instance, I stipulated that the minimum income of a married pensioner should be R92 per month. That has had the result that hundreds of pensioners, people who had been railworkers for instance, receive an allowance of as much as R70 per month in addition to a monthly pension of R15 or R20. The total income of these people has been increased to R92 per month. It has always been the policy to render assistance first to those people who were having the hardest time and who were living under the most difficult circumstances. I have again increased the temporary allowance this year. I have also increased the minimum income of a married pensioner. However, there is also criticism from my working staff. They complain that they have to do a full day’s work, sometimes difficult and hard work, and that they have to do so at a remuneration which is often less than R150 per month. They say that the Minister is nevertheless prepared to raise the means test and to pay those people such a large allowance that their income is considerably more than the monthly wage of some working officials.

The hon. member for Port Natal wanted to know certain things about a private club at Salisbury Island. I am still waiting for the information he seeks, and as soon as I get it I will let him know.

*The hon. member for Kempton Park spoke about staff housing. Well, as I have told a previous speaker, it is my desire to supply all members of the staff with housing. We have three different schemes, of course, two of which are home ownership schemes, while the other scheme relates to departmental houses. I do not know whether hon. members realize what loss is suffered annually by the S.A.R. in respect of departmental housing. The Railways suffers a loss of approximately R8,000,000 per annum. What it amounts to is that a railwayman who lives in a departmental house has an extra income. The reason for this loss is the low rentals charged. Rentals are not even sufficient to cover the interest on the capital, let alone maintenance and repair costs. In spite of this fact, we are continually building houses. As a matter of fact, Mr. Chairman, during my time as Minister of Transport I have had more railway houses built than any other Railway Minister has ever done. I have had as many houses built as possible, because by doing so I attract people to enter my service and I retain the services of those who are already working for me. And I am continuing with this policy. But each year I can only set aside a certain amount to be used for housing. Then there is the home ownership scheme. Another scheme is that which guarantees applicants’ obligations to building societies. Loans granted under the latter scheme naturally carry a high rate of interest. If everything is taken into consideration, Mr. Chairman, I feel that Railway servants find themselves in a much more privileged position than any civil servant. They have the home ownership scheme. They can also rent a departmental house at a very low rental.

The hon. member for Kempton Park also complained because the Airways speak of the airport at Johannesburg, while it is actually situated in Kempton Park. Well, the difficulty is that Johannesburg is somewhat larger than Kempton Park. It is also somewhat more important. This airport is, of course, an international one. Many people in the outside world have heard of Johannesburg, but I do not know how many have heard of a place like Kempton Park.

*Dr. J. A. COETZEE:

Then it is time they heard about it.

*The MINISTER:

If a foreigner heard that he was flying to Kempton Park, he would perhaps not know whether he was going to Africa or Asia. We have to advertise our air service. We have to attract as many tourists as possible to our country. If we tell them that they should come to Johannesburg, they know that they would see something. But if we tell them that they should go to Kempton Park, well, what is happening there after all? Mr. Chairman, I am really only joking with the hon. member. I know to him Kempton Park is the most important place in the country. Because, after all, it is the place which sent him to Parliament! But I do not think I can comply with his request. The airport’s name is Jan Smuts Airport and it serves mainly Johannesburg. If the name should be changed, I think it should perhaps rather be called the Pretoria Airport. I think Pretoria has a greater claim to such a change of name than Kempton Park. Pretoria has many more passengers than Kempton Park, but Johannesburg again has many more than Pretoria. For that reason I think we should leave the name as it is.

Heads put and agreed to.

Heads 18 to 25,—“Harbours, R21,861,400”.

Mr. H. LEWIS:

Mr. Chairman, I should like to discuss with the hon. the Minister the policy he laid down regarding the dredging of our harbours and the accommodating of super tankers and excessively big ships. I was rather perturbed by the strange attitude adopted by the hon. the Minister in this regard. We have had difficulty in this respect in the past, too, Mr. Chairman. The hon. the Minister lays down a certain policy and then will not change it notwithstanding changed circumstances. Now, Sir, while I accept that the average vessel is tending to become smaller—because the average passenger ship is disappearing—yet bulk carriers are being built bigger and bigger. The hon. the Minister has said that he is not going to deepen our harbours to accommodate these very large ships.

The MINISTER OF TRANSPORT:

If the ship has a shallow draught then deepening of the harbour is not required.

Mr. H. LEWIS:

But they do not have shallow draughts.

The MINISTER OF TRANSPORT:

Yes, they have. We have just had a 70,000-tonner built.

Mr. H. LEWIS:

But a 70,000 ton ship is not a big ship to-day. It is not a big bulk-carrier. A 70,000-tonner is a small carrier. Up to what tonnage are to-day’s ships being built, Mr. Chairman? The hon. the Minister knows as well as I do that they talk of a quarter of a million tons now, in any case not less than 100,000 tons. I want to put this point quite clearly, Sir, because I believe that the hon. the Minister, whether he likes it or not, has to make some provision for the handling of these ships and their cargoes if South Africa is to remain in the picture.

The MINISTER OF TRANSPORT:

Not in our existing harbours.

Mr. H. LEWIS:

I think the hon. the Minister is missing the point entirely. I think that had he thought deeper about the matter and had he adopted a different approach, he might well have given a different answer. Let us take the question of big tankers. We have encouraged three refineries to come to our country. The cost of fuel to the people of South Africa—and the other countries we supply—will depend on the economic transport of crude fuel to South Africa. This is something which the hon. the Minister has to take into consideration. He cannot decide that we are going to pay higher freight rates for our crudes because he will not do anything to improve the accommodation for private carriers in our harbours. This afternoon the hon. the Minister of Finance informed us that the cost of fuel is going up. Surely the hon. the Minister’s mind must be open enough to explore ways and means of reducing the cost of crude fuels. There are two or three ways in which this can be done. One of the methods adopted in the world today is the use of a type of loading buoy which obviates the necessity of bringing a tanker into a harbour at all.

The MINISTER OF TRANSPORT:

That has already been investigated.

Mr. H. LEWIS:

The hon. the Minister has turned it down? He has not told us the results of his investigations.

The MINISTER OF TRANSPORT:

I have not turned that down. I turned down the proposal for deepening our harbours.

Mr. H. LEWIS:

That is fine. But I gathered from the Minister’s reply that he was not prepared to countenance the carrying of bulk cargoes to our ports by those vessels which are the most economic of their type. The hon. the Minister must clear this up. He must not leave it hanging in the air, Sir.

The MINISTER OF TRANSPORT:

When did I say that, in what reply?

Mr. W. V. RAW:

You said that if they want to do business with us then they must use our harbours.

The MINISTER OF TRANSPORT:

Are you referring to a newspaper report?

Mr. H. LEWIS:

Yes. But the hon. the Minister has not denied that report. I have seen no denial of that report.

The MINISTER OF TRANSPORT:

I have not denied it. I will deal with it in my reply.

Mr. H. LEWIS:

May I offer some other suggestions which the hon. the Minister may investigate. Let us take Durban harbour as an example. If the Minister should decide against using the buoy system of off-loading, what does the hon. the Minister think about deepening the channel to Island View? That will not be such a gigantic undertaking. It is not such a formidable project that it cannot be undertaken. It will not involve the deepening of the whole harbour. All that is required is the deepening of the channel to Island View. No blasting will be required, as is the case in Table Bay harbour. Dredging operations should be sufficient. The whole project could be spread over a number of years. These are things which will be of great advantage to our country in years to come. Two of our three refineries are located in that area. I should like the hon. the Minister to be more open-mirtded when it comes to the subject of our harbours. It seems to me he is firmly determined to stay a jump behind instead of being a jump ahead. He has more or less provided for the average ship which is the 8,000 to 12,000 tonner, and the hon. the Minister knows that. All the shipping companies tend to concentrate on those ships to-day. I accept that the big passenger ships will tend to disappear. But I do believe that the bulk carrier is going to become one of our most important means of conveying goods from one port to another.

I know that the hon. the Minister has been approached by several members of the conference lines on the question of having goods “containerized” containers. I do not know what investigations the Minister has done on those lines. I think the time has arrived for him to express an opinion and show us in what direction he is moving in regard to the container packaging and container handling of goods. He might have set his mind against that, too. I know that the shipping companies, after discussions amongst themselves, were very, very keen indeed on moving along the lines of using container packaging. But I believe that the hon. the Minister said that we were not ready for that yet. I would like to know from the hon. the Minister what he intends doing about this matter too.

The House adjourned at 7 p.m.