I move—

I want to record our objection to this Bill. We shall vote against the third reading. I think this Bill probably throws a clearer light on the Government’s repeated statement that it wants cooperation from this side of the House, when we realize that this Bill constitutes an amendment to the Republican Act, an Act which was put on to our Statute Book only a few short months ago. Here we are already making a vital and a cardinal change to that Act. I wonder how many further amendments to that Act the Government intend to make? It shows that even an Act of their own choosing is no more sacred to them than the old South Africa Act was.

Order! The hon. member must confine himself to the contents of the Bill.

I bow to your ruling, Mr. Speaker. I make the point, Sir, that this is an amendment of the Constitution Act of the Republic and that it is taking place without there having been any consultation with us. It introduces the principle that the winner takes all as far as Executive Committees are concerned. The Government holds on to its right to appoint an Administrator but it grabs all the seats in any Executive Committee that it can get hold of, even by means of a bare majority of one. The rights of the minority groups are destroyed. The rights which they have enjoyed in the Executive Committees as well as in the Senate, rights which have been protected, are now destroyed. We object to it. We voice our protest against this breach of our Constitution and the introduction of the spoils principle into our provincial system. We shall vote against the Bill.

Motion put and the House divided:

AYES—82: Bekker, G. F. H.; Bekker, M. J. H.; Bezuidenhout, G. P. C.; Bootha, L. J. G.; Botha, H. J.; Botha, P. W.; Botha, S. P.; Coertze, L. I.; Coetzee, B.; Cruywagen, W. A.; de Wet, C.; Diederichs, N.; du Plessis, H. R. H.; Faurie, W. H.; Fouché, J. J. (Sr.); Fouché, J. J. (Jr.); Frank, S.; Grobler, M. S. F.; Hertzog, A.; Heystek, J.; Hiemstra, E. C. A.; Jonker, A. H.; Jurgens, J. C.; Keyter, H. C. A.; Knobel, G. J.; Kotzé, G. P.; Kotzé, S. F.; Labuschagne, J. S.; Loots, J. J.; Luttig, H. G.; Malan, A. I.; Malan, W. C.; Marais, J. A.; Marais, P. S.; Maree, G. de K.; Martins, H. E.; Meyer, T.; Mostert, D. J. J.; Mulder, C. P.; Muller, S. L.; Nel, J. A. F.; Nel, M. D. C. de W.; Niemand, F. J.; Otto, J. C.; Pelser, P. C.; Potgieter, J. E.; Sadie, N. C. van R.; Sauer, P. O.; Schlebusch, J. A.; Schoeman, B. J.; Schoonbee, J. F.; Smit, H. H.; Stander, A. H.; Steyn, F. S.; Steyn, J. H.; Treurnicht, N. F.; Uys, D. C. H.; van den Berg, G. P.; van den Berg, M. J.; van den Heever, D. J. G.; van der Ahee, H. H.; van der Merwe, J. A.; van der Walt, B. J.; van Eeden, F. J.; van Niekerk, G. L. H.; van Niekerk, M. C.; van Rensburg, M.C. G. J.; van Staden, J. W.; van Wyk, G. H.; van Wyk, H. J.; van Zyl, J. J. B.; Venter, W. L. D. M.; Verwoerd, H. F.; Viljoen, M.; Visse, J. H.; von Moltke, J. voh S.; Vosloo, A. H.; Waring, F. W.; Webster, A.; WentZél, J. J.

Tellers: D. J. Potgieter and P. S. van der Merwe.

NOES—42: Barnett, C.; Basson, J. A. L.; Bloomberg, A.; Bowker, T. B.; Bronkhorst, H. J.; Cadman, R. M.; Connan, J. M.; Cronje, F. J. C.; de Kock, H. C.; Dodds, P. R.; Emdin, S.; Field, A. N.; Fisher, E. L.; Gay, L. C.; Gorshel, A.; Henwood, B. H.; Hickman, T.; Higgerty, J. W.; le Roux, G. S. P.; Lewis, H.; Malan, E. G.; Mitchell, D. E.; Mitchell, M. L.; Moore, P. A.; Odell, H. G. O.; Oldfield, G. N.; Plewman, R. P.; Raw, W. V.; Ross, D. G.; Steenkamp, L. S.; Steyn, S. J. M.; Streicher, D. M.; Suzman, H.; Swart, H. G.; Taurog, L. B.; Tucker, H.; van Niekerk, S. M.; Waterson, S. F.; Weiss, U. M.; Wood, L. F.

Tellers: N. G. Eaton and A. Hopewell.

I want to move the following amendment—

The meaning of this amendment is that the insignia of the State President or of an order which he may establish will be protected in terms of the provisions of this Bill, and also the insignia of officials of the House of Assembly and the Senate.

I want to refer to Clause 1 (v). It concerns a technical point and I hope the Minister will accept it. There is redundancy. It reads as follows—

The words “displayed in colours in conformity with the principles and rules of heraldry” are superfluous. One cannot have a coat of arms without colours. I therefore want to suggest that the words I quoted should be omitted. They are redundant.

I am afraid I cannot be the judge of this. I do not know why the authorities who drafted the Bill would have included the words if they were superfluous. I do not know why they should have repeated something which need not have been mentioned. Is there any danger in it if it is repeated?

It is superfluous.

Even if it is, is there any harm in it? I cannot judge whether it is so or not. But I am now informed that a symbolic representation may be without colours, but not a coat of arms. In other words, these words are not superfluous. They must cover everything.

Clause, as amended, put and agreed to.

On Clause 2,

Here I should like to move the following amendment—

The reason for this is that the State President already possess prerogative powers in terms of the Constitution to recommend applications for the grant or amendment of official coats of arms, etc., and it would be superfluous to provide here that it is not the intention to limit it in any way. Therefore I want to suggest that it be omitted as being superfluous.

I just want to ask whether that also applies to coats of arms, etc., of individuals who obtained their coats of arms overseas?

It includes all coats of arms registered here, whether the person obtained it overseas or here, if it is registered here as being a genuine coat of arms.

Once again I just want to draw attention to the fact that in the words of the hon. the Minister himself the chief figure in this matter is the State President. I again, as I indicated yesterday, want to lodge objection to appeals being lodged with the Minister, or in South West Africa with the Administrator. I wonder whether the Minister cannot somewhere insert the words: Appeal to the Minister or Administrator acting on behalf of the State President. I should like to know whether the Minister cannot insert something to that effect so that we can adopt this principle to which he himself has subscribed.

Here I want to move the following amendment—

There will be quite a few such amendments. It concerns amendments moved in the Other Place, viz. the words appearing in brackets. They have financial implications in regard to which the Senate may not decide anything.

I move the following amendment—

I move the following amendment—

Here I move the following amendment—

I want to direct the attention of the Committee to the fact that in the Other Place my attention was drawn to the fact that in Clause 22 the word “or” has already been inserted in line 68. Clause 22 reads as follows—

Originally the word was “and” but it was changed in the Other Place from “and” to “or”. But then we had already passed Clause 21. It is really the same amendment which I am now moving in Clause 21. I read the clause from the beginning—

This “and” is now also being replaced by “or”. It then really gives the correct meaning.

Here I want to move the following amendment—

Agreed to.

Clause, as amended, put and agreed to.

On Clause 26,

I move—

1. (a) by the substitution in sub-section (2) of Section 3 for the words “of five pounds” of the words “prescribed by regulation

and in line 60, after “1962’;” to add “and by the substitution in the said sub-section for the words ‘of ten shillings on or before the thirtieth day of June in each and every year’ of the words ‘ prescribed by regulation on or before the thirtieth day of June, 1963 ’ ”.

Agreed to.

Clause, as amended, put and agreed to.

Remaining Clauses and Title of the Bill having been agreed to,

House Resumed:

Bill reported with amendments.

Order of the Day No. VIII to stand over.

We have no objection to this Bill and we shall support the second reading. This Bill gives an opportunity to develop inventions but we would give this warning to the Minister. We hope that the Minister will see to it that the board only encourages inventions which are in the national interest.

Clause 4 of the Bill provides for the application for letters patent and for the revocation thereof and to oppose the granting of letters patent. I think it is essential that in a Government body such as this there should be no direct competition with private enterprise. It is essential that a body such as this, having great powers, should only work in the national interest and should not be in competition with private enterprise. The one disadvantage we see is, that although there is provision in this Bill for the Tabling of the report and annual accounts, there seems to be no opportunity for discussing that report in Parliament. We have raised similar objections in regard to other bodies from time to time. But here we have another board, which is virtually a Government Board, which will not be under direct parliamentary control. There will be very inadequate opportunity for discussing its annual report. Here we have an organization which can apply for letters patent, which can develop inventions and in our opinion may be developing wrong inventions or alternatively may not be developing sufficiently, and yet there will be little or no opportunity of bringing that to the notice of the Minister. We do think that there should be an opportunity of discussing the reports that will be tabled in the House from time to time.

Clause 5 of the Bill provides for the appointment of personnel and Clause 6 provides for the appointment of the management and the control of the corporation. I do hope, Sir, that the Minister is not going to have a board which is virtually an old men’s home. There has been a tendency in recent years—I do not want to reflect on all members—to appoint senior civil servants in some cases, when they have served their term of office, to serve on boards. In some cases those appointments have been well merited. In other cases you suspect that appointment has been an additional reward for services rendered. Particularly in the field of invention we want young men with young ideas. It is no good putting on to the board people who are hide-bound and who are concerned with rules and regulations and not with enterprise and with serving the best interests of the country and encouraging development and the initiative of young men. I hope that the board of directors will be selected in such a way that it will encourage our best scientists and our best organizers into a field which warrants initiative and drive.

The share capital of the company is very meagre, Sir, but I appreciate that this is a token share capital. I hope that we will not have any suggestion of a step towards socialism in the establishment of a company such as this. We want to encourage the development of private enterprise in this country. We realize that tor research purposes there must of necessity be Government control. We also recognize that frequently private enterprise will not develop an invention unless there is an opportunity of making a profit. The Government frequently has to pave the way. We hope that when the Government enters into the field of developing inventions it will not stand in the way of private enterprise but will rather use the opportunity to initiate development, and having initiated it, will leave private enterprise to take the next step. We regard this purely as an organization which will foster development and will not hold on to it indefinitely. Provided that the Corporation follows those lines, it will have our support. We hope the Minister will see whether it is not possible not only to have the reports of this Corporation tabled from time to time, as is provided in the Bill, but will see that provision is made for time to be allotted in Parliament for these matters to be discussed. The information should be made available to hon. members from time to time and there should be an opportunity of discussing these matters in the best interests of the country, rather than to leave it entirely to the discretion of the Minister’s Department to decide whether or not an invention could be developed. There should be a full opportunity for the work of this organízation to be debated across the floor of this House, where we can have the opportunity to criticize and to make suggestions and the Minister can reply, and that discussion, we submit, will be worth while and will be of help to this organization. We hope that the Minister will bear that in mind and will not regard the tabling of the reports of a mere formality where there will be no opportunity to discuss the report in Parliament, which is the forum where reports of this kind should be discussed. We support the Bill.

Mr. Speaker, I would like to join the hon. member for Pinetown (Mr. Hopewell) in welcoming the setting up of a State-sponsored corporation to finance the exploitation of South African inventions, and the protection of such inventions by patents inside the Republic as well as on a world-wide basis. This Bill is a welcome measure as long as it does not interfere with private enterprise. The basic principle in establishing such a corporation, financed directly or indirectly from public funds, has been that such spending of public funds is only justified when the activities of such a corporation would be of national importance, and also when no capital for such purposes would be available from private sources. It appears from the statement of the hon. the Minister that the major field of activity of this proposed new Corporation will concern inventions mostly from Government Departments, and more specifically by the C.S.I.R. Now this fact may give rise to a train of circumstances which have to be very carefully considered.

I think we are agreed that the C.S.I.R. is one of the most up-to-date, all-round research organizations in this country to-day. It covers fields of research extending from building materials to nuclear physics. The purpose of the laboratories and staff of the C.S.I.R. is to provide research facilities for the State and private enterprise against proper payments. The best of equipment and the staff and the salaries of the staff are provided from public funds. So I feel that as long as the C.S.I.R. laboratories are confined to research only, their services to the State and to private enterprise do not clash, but the experience obtained in research for the State benefits the research done by private enterprise, and also vice versa.

But furthermore, we have to consider now the taking out of patents. The taking out of patents was more the exception than the rule in the previous practices of the C.S.I.R., although some very valuable patents have been obtained, for example the radar surveying instrument mentioned earlier by the hon. the Minister, the tellurometer. But the setting up of this new Corporation has perhaps shifted the emphasis of the C.S.I.R. from research to an increasing interest in patent rights, and this tendency might have a number of perhaps undesirable effects. The first is that unbiased co-operation between private enterprise and the C.S.I.R. can be adversely affected. Private enterprise could perhaps be afraid that their ideas entrusted to the C.S.I.R. for research may be, through major or minor improvements, patented by the new Corporation, and some scientists of course object to having their ideas and the results of their research patented at all. They wish to see the widest possible world use made of these ideas, and the completely unrestricted use made of the results of their efforts. Here I would like to refer to Sir Alexander Fleming, who discovered penicillin, and that was an idea that went into the world pool without being patented at all. If the inventors of inventions of extraordinary monetary value are exploited perhaps for profit-making by the new Corporation, we have to consider the reaction on the inventor himself. The usual reaction of the inventor himself is grave dissatisfaction and whatever the terms of his contract may be, he feels perhaps that he is being deprived of the benefit of his brainchild. Then we have to consider another thing, which is the patent mania to-day. There is such a thing as patent mania, and it has to be guarded against amongst people, and the main purpose of the C.S.I.R. is research. The staff’s interest in patent rights should not be encouraged, except in very important cases, because this Bill provides for various contingencies in regard to patent rights and the issues arising out of that. But in some cases, including exceptionally important cases, it is undesirable to take out patents. Here I wish to touch on the patent laws, especially in South Africa. The reason for this is due to the fact that in South Africa the applications for patents have to be accompanied by a very detailed description of the invention or discovery, and these details are immediately published and they are available for all interested parties, in South Africa as well as overseas, to study, and there are two undesirable consequences of this. Firstly, competitors can immediately start with improvements or extensions to circumvent the exclusiveness of the patent, and even in countries subject to international agreement on patents and trade marks this can take place. Secondly, let us not forget that the one country not party to this international agreement is Russia, and Russia has a department watching all scientific and technological publications and they take up any invention which is of any value to them whatsoever without any regard to any patent rights. The C.S.I.R., I feel, wish to develop through the new Corporation inventions of great national importance, but by restricting the activities of the new Corporation to existing types of patents, all the already mentioned disadvantages will arise. Therefore I feel we should examine the laws outside South Africa on this point of patents. In the United Kingdom the laws governing patents allow of so-called secret patents. That is inventions which are protected without publishing the detailed descriptions, and a large number of important inventions for defence fall into this category, as they also do in the U.S.A., where secret processes are protected against infringement without patents when such processes are considered the intellectual property of the inventor. I would like to suggest, with due respect to the Minister, that the Inventions Development Corporation could be made more effective by extending the laws regulating patents to include perhaps these items, and such processes would be guarded and the patent would be granted only under exceptional circumstances by a special committee, and the final decision in such cases should rest with the Minister of Economic Affairs and the Minister of Education, Arts and Science.

There is only one further point I should like to raise, and that is the point which appears on page 7, Clause 9 (1) of the Bill, which states the period of office of the directors of the Corporation and also the period of office of the chairman of the board of directors shall be determined by the Research Council; and on the preceding page 5, in Clause 6 (2), it says that the members of the board of directors shall be appointed by the Research Council. I feel here that it may be desirable that the Research Council should appoint all the directors but should it also determine the period of their office without any control? I would like to ask the hon. the Minister whether this is desirable. As the directorships naturally include salaries which are paid out of public funds, or are guaranteed from public funds, I would like to suggest that while the appointment of the directors should rest with the Research Council, the period of office of the directors and of the chairman should be subject to the approval of the Minister of Economic Affairs and of the Minister of Finance. After all, this control is in line with the principle that the expenditure of public funds should be controlled by Parliament. It is not only necessary to avoid the possible appearance that members of the Research Council could appoint themselves or each other to directorships, but it is also necessary for us to examine that and to ensure that persons scientifically out of date could not continue or be reappointed, and that an inbred board of directors could be rejuvenated by bringing in new and up-to-date scientists and technicians to the board of directors of the new Corporation. Mr. Speaker, we are living in a new and rapidly developing world of science and technology to-day. In America in certain new branches of science men of 30 are considered, if I may use an American expression, “burnt up”. Most new ideas coming over the frontiers of science to-day come from men in their early thirties and it may be well for me to suggest, with due respect, that the Minister should give consideration to this idea. The South African Inventions Development Corporation is on the whole a right step in the right direction. We should now use all possible safeguards to ensure its maximum success for the people of South Africa.

It is a privilege to me to congratulate the hon. member who has just sat down on her maiden speech, an expression which is very fitting in her case. Usually when we talk about maiden speeches we refer to hon. gentlemen. I want to say frankly that her approach to the subject was not only surprising but so informative that I have every reason for congratulating her heartily on her delivery of a speech which was really worth while.

I want to say further that this Bill really renders a particular service to the country. The patenting of inventions is of particular importance and it is something which ought to be done. I think here the Government is rendering a particular service to the country, because in a young country like ours with all our problems we must invent things or else remain standing still. There has been enough proof afforded in South Africa as to the efficiency of our scientists, particularly under the control of and in co-operation with the C.S.I.R., to show that good work is being done. I may just mention one example, the new method of measuring distances. It may not be known to all hon. members, but the new method invented and developed by the C.S.I.R. is being accepted to-day by the military authorities of the U.S.A. and is regarded as the most modern and speedy method of measuring distances, something which is of the utmost importance for military purposes. Not only that, but often inventions are made by people who are sound scientists but who are not possessed of the necessary funds to patent these things, and where this is now being put into the hands of the Government which will continue developing these things, matters are facilitated for these people, and therefore it is a particularly good idea.

Then there is just a second point I wish to emphasize, something which the hon. member also emphasized, namely the fact that Russia is not at all concerned as to whether inventions are patented, and that she makes use of any new invention. For that reason what the hon. member said is of the greatest importance, namely that the details of such inventions should be kept secret and not be published, but that it should be left to a committee for consideration and decision as to whether patenting is justified without divulging the full details. As in all spheres of life, one will always find people who try to gain information in an unscrupulous manner and to use it for their own profit. For that reason it is not necessary to issue another warning, but I think that particularly here where the work in the sphere of science in South Africa is mostly in the hands of the Government through the agency of the C.S.I.R. and other research institutions, agricultural and otherwise, it is a particularly good thing that the Government should take the lead in this matter. I want to congratulate the Minister on the fact that he has begun to move in a necessary direction, which is also to the advantage of the country.

While this Bill has been welcomed from all sides of the House, I think it does require emphasis that the implications of the Bill are undoubtedly an encroachment into the field of private enterprise. This has already been stressed by speakers on this side of the House, but in a modern economy I suppose we have to accept that the Government and Government institutions must from time to time play an active part in the economy of the country. This is all the more so when we find conditions as they are in South Africa to-day, where the rate of increase in the national income is far below the rate which any of us would desire. Private enterprise itself has over the past many years now been spending increasing amounts of money on research and development, and I would like to add my expression of hope that this Corporation and industry will complement each other and not be antagonistic to one another, and that the one will supplement and not replace the other.

The Corporation appears to be, if I may use the term, a complete subsidiary of the C.S.I.R. In Clause 5 the personnel of the Corporation are to be seconded from the C.S.I.R. In terms of Clause 6 the board of directors has to be appointed by the C.S.I.R., including the managing director. In terms of Clause 9, the conditions of engagement of the directors are fixed by the C.S.I.R. in consultation with the Minister, and in Clause 10 provision is made for the entire share capital to be subscribed by the C.S.I.R. Now the question Doses itself whether there is a real need for this Corporation at all and whether the objects set out in the Bill could not have been as efficiently handled, and perhaps more economically handled, by a department of the C.S.I.R. itself, instead of setting up an entirely new corporation. The term “Parkinson’s Law” is, I suppose, more bandied about these days by business men than any other single term, and I sincerely hope that the establishment of this Corporation is not a further manifestation of Parkinson’s law.

The object of the Corporation, as defined in Clause 3, shall be to develop or exploit inventions in the public interest, and Clause 4 (1) (c) gives the Corporation the power to acquire any right in any invention or to assign to any enterprise any right in or to any invention. That presupposes that the object of the Corporation is to hand over a patent after development to the private sector. I would have preferred, instead of the wording of Clause 3 and Clause 4 (1) (c), to retain in this Bill the words used in Section 11 of Act 33 of 1945, the Scientific Research Council Act, which says that such discoveries, inventions and improvements shall be made available for use in the public interest, subject to such conditions or the payment of such fees and royalties as the Council may, in accordance with the regulations made by the Governor-General, determine. This section in Act 33 of 1945, I think it is fair to say, is a clear indication that the invention will be handed over to private enterprise in most cases for further development, whereas the reading of the words of the two clauses in this Bill which I quoted is only permissive. I should like to add my plea to that of other speakers on this side of the House that there will be no doubt that the development undertaken by the Corporation will flow naturally to private enterprise for exploitation.

Clauses 12 and 16 of the Bill deal with the taxation of the Corporation and in fact make the Corporation liable for exactly the same taxes as any other company. It would appear that the Corporation will be liable for undistributed profits tax and in terms of Clause 12 special provision is made that any payments made to the C.S.I.R. shall be construed as a payment of a dividend so as to avoid payment of the undistributed profits tax. But provision is also made that the Corporation, with the consent of the Minister, can allocate certain sums to reserves. Now you may find yourself in this position, that the Corporation has made a certain amount of profit for the year, that the Corporation and the Minister in their wisdom have decided to transfer certain portions of those profits to reserves and that the remaining amount which can be distributed as a dividend will be insufficient to relieve the Corporation of the liability for undistributed profits tax. Mr. Speaker, this is not an ordinary company in the ordinary sense of the word. The undistributed profits tax was brought into being to prevent companies holding profits in those companies and not distributing them to the shareholders, so avoiding the incidence of taxation on amount distributed by the company to the shareholders. But this is a State body and it seems to me it might be found—and I should like to suggest this to the Minister—that in defining the amounts to be transferred to the reserves, these should also be deemed to be a distribution of dividends for the avoidance of undistributed profits tax. Otherwise we will have this Corporation paying the undistributed profits tax, and I am sure that this is not the intention.

There is only one other item I should like to mention. We are dealing here with inventions, the product of a man’s mind. Some inventions which have been most successful have been trivial things, like the head on a pin and the little metal section of a shoe-lace. Many of these small things have been a boon to mankind. We are now setting up this Corporation and I should like to suggest to the Minister that he may find it to the advantage of the country and of the inventors perhaps to offer an annual prize, through the Corporation, for that invention which in its view is most useful and most to the benefit of the people of this country.

In the first place I should like to express my appreciation to members on both sides of the House for the way in which they have received this Bill and the blessing which they have given to it. In the second place I should like to convey my heartiest congratulations to the last speaker and to the hon. member for Johannesburg (North) (Mrs. Weiss) on their maiden speeches. We are very pleased to hear speeches of this kind in this House and to know that there are members here who are able to discuss scientific issues in the way that they did here to-day. I should like to congratulate the hon. member for Johannesburg (North) particularly on the clear light which she has thrown here on some of the most complex problems in the scientific field. Her knowledge of these matters and her experience come as a surprise to all of us and both her speech and that of the other new member introduced a fresh breeze into this Chamber. I understand that the hon. member is closely associated with persons and bodies which have had years of experience in the sphere of patenting; in other words, she speaks from experience and so apparently does the hon. member for Parktown (Mr. Emdin). We trust that this experience of theirs in the field of science and of patenting will be used fruitfully in this House in the interests of this matter and of this country.

There are quite a few matters which hon. members have raised and which I need not got into now, but which we shall be able to discuss more fruitfully in the Committee stage. But I should like in the first place to mention a few matters of principle which have been referred to by various speakers and also by the hon. member for Pinetown (Mr. Hopewell). The fear has been expressed that this Corporation may perhaps enter the field of private enterprise. I want to give hon. members the assurance that it is not the intention at all that this Corporation should ever enter the field of private enterprise; on the contrary, the intention is that it should open the way for industrial development and for further progress in the field of private initiative. For example, it is not the intention of the Corporation to exploit any invention itself. Its intention is only to develop inventions until the stage is reached where they can be exploited by private initiative. That is the whole idea. It will possibly have a share only in the private sector, by way of a share in the profits or by way of a royalty so as to reimburse its costs, but the idea is not that it should utilize or exploit the inventions itself. Another reason why, as far as patenting is concerned, it will not clash with private initiative is this: The object in giving these powers to the Corporation is in fact to relieve the C.S.I.R. of the duties of patenting. The hon. member for Johannesburg (North) (Mrs. Weiss) has expressed the fear that the C.S.I.R. may now concentrate on patenting and neglect its research. No, the contrary is true. This Corporation is in fact being established with the object of allowing the C.S.I.R. to confine itself to its developmental and research work and the patenting and developmental work connected with inventions will be done by a different body. I want to say, too, that the idea is not that patenting should be undertaken just for the sake of patenting. The only object of patenting is to be able to have control over the invention so that you can develop it. But if that control over an invention can be obtained by some other means, by means of a “know-how” agreement or something of that kind, then perhaps that course will be followed. It is not a question of patenting an invention just for the sake of patenting it.

The hon. member for Pinetown has expressed the hope here that we will see to it that the directors are young people. I agree one hundred per cent with him. As far as we as a Government can exercise any influence over the C.S.I.R., we shall try to see that the directors are not has-beens but people who can make a fruitful contribution in the scientific field. Moreover, it is laid down in the articles of association that the directors shall be appointed—

It is laid down what the qualifications of these persons are to be, and in so far as the Government may have a say in this matter, we shall see to it that the directorate does not become a haven of rest for has-beens.

The hon. member for Johannesburg (North) has asked whether we should not lay down the period of office of the directors. The hon. member is probably aware of the fact that in various Government Corporations the matter of determining the duration of the term of office of, say, a director, rests in the hands of the person who makes the appointment. Take the Electricity Supply Commission, for example. No period is laid down as to the length of service of a Commissioner; the Minister appoints a Commissioner for what ever peiod he deems fit. The same applies here. We as a Government, if this Bill is accepted in this form, will have no direct say. The C.S.I.R., although it has State funds at its disposal, is the body which will make the appointments, and it has the right to determine the period of office of the directors. Clause 15 (c) provides for—

That is one of the things in regard to which the Minister may promulgate regulations under Clause 15 (c). It would appear, therefore, that under Clause 15 (c) of this Bill, read together with Clause 9, we can exercise some influence over the C.S.I.R., even though it is only moral influence, to appoint this type of person for whatever period we may deem fit. That is a matter that we shall go into further.

The hon. member for Pinetown, in referring to the financial returns of this Corporation, stated that he would like this House to have the opportunity of discussing the Corporation’s returns. The hon. member knows, of course, that is a matter which has been before this House for almost as long as he and I have been here. I would be quite happy to comply with his request if this policy became the policy in respect of all Government Corporations so that we can have a common pattern for all of them. I would then be quite willing to have this Corporation conform to the common pattern for all Corporations. As long as that is not the position, I hope that hon. members will make use of the opportunity to raise matters of this kind in the Budget debate. We have many opportunities to discuss financial matters in Budget debates but instead of doing so we discuss other matters. In the Budget debates, of which we have three or four every year, my hon. friend will have every opportunity to discuss these matters, and I would ask him to deal with financial matters in the main Budget debate that we shall be having towards the end of March; there he will have an opportunity to discuss this matter. The hon. member for South Coast (Mr. Mitchell) laughs; apparently he believes that Budget debates are not intended for the discussion of financial matters.

The last point that was referred to is the question of capital. The hon. member for Pinetown says that the capital is on the low side. Yes, it is not high, but this is a beginning and provision has been made to increase the capital with the permission of the Minister of Economic Affairs and the Minister of Finance, and if it becomes necessary to do so we shall increase it.

I thank hon. members for their support and for the way in which they have received this Corporation. I am convinced that this Corporation will play a very important role in our scientific research, in our patenting and in our development and our experiments and in the promotion of our industry.

Motion put and agree to.

Bill read a second time.

I would like to move the amendment as printed in my name on the Order Paper—

I would like to draw attention to the provisions of Act 60 of 1952, a measure which also amended the Wool Act and under which the wool profits were distributed. Section 19 inserted a new Section 34bis in the principal Act. The new Section 34bis provided for the increased levy on wool. Section 9 of Act 60 of 1952 provided—

I would like to draw attention to the provisions of the South West Africa Affairs Amendment Act which was an Act amending Act 42 of 1925. That Act provides in Section 18, which inserts a new Section 28, in sub-section (3)—

The reason for the insertion of that was that the new sub-section (2) of Section 28, as inserted by Section 18, provided that—

It is clear therefore that as the Wool Bill applies to South West Africa and as provision is made for the increase of the levy, it is essential that the legislation which would be valid so far as South West Africa is concerned, must comply with the provisions of the South West Africa Constitution so far as South West Africa is concerned, and the amendment moved by me merely brings this Bill into exactly the same form as the 1952 amendment; in other words, what it does is to honour the provisions of the South West Africa Constitution and gives effect to it. I am aware that apart from the provision which I have quoted, namely the provision that so far as South West Africa is concerned, that wherever a tax is imposed there must be the consent of the local Legislature, Section 22 of the South West Africa Affairs Amendment Act contained a saving clause which reads: saving as to right of Union to administrate and legislate for the territory, Section 44 (1) provides—

Sir, the late Prime Minister, Dr. Malan, when his attention was drawn to the apparent conflict between Sections 18 and 22 of the South West Africa Affairs Amendment Act, gave this explanation, which is on record in the Senate Hansard, namely, that the earlier Section 18 was a pledge in honour given by South Africa to South West Africa, which would be honoured in all respects, and that the saving in Section 22 was to make it perfectly clear that South Africa was in no way derogating from the powers vested in her in terms of the mandate under which South West Africa was entrusted to the charge of the Union. I say to the hon. the Minister that I do hope that he will accept this amendment. It is in terms of the assurances given by Dr. Malan; it is in terms of the South West Africa Administration Act; it is in terms of the precedent established by his predecessor, the then Minister of Agriculture, Mr. Le Roux, in 1952. It is most desirable that he should accept it, especially at this time and especially in respect of a territory such as the mandated territory of South West Africa, which is very much in the news throughout the world at the present time. I do most sincerely hope that in the interests of this country and of South West the Minister will accept the proposed sub-section which I moved. It can only be to the good. Apart from that it seems perfectly clear that it is a necessary provision, as Parliament itself showed when it put a similar provision in the 1952 Act.

I think only the hon. member for Germiston (District) (Mr. Tucker) knows why he has moved this amendment this afternoon. The hon. member has given us an exhibition of his legal knowledge about the constitutional position of South West. Had you sat on the gallery, Sir, you would have thought that we were discussing the mandate which South Africa had over South West. You could practically say that this was evidence that ought to be led before the International Court when they decide on the position of South West. What is really proposed in this clause? It says that whereas the maximum wool levy was a halfpenny, it can now be one cent. I wonder whether the South West Administration or the National Wool Growers Association of South West or any other organization has approached the hon. member and said to him: Look, the Republican Parliament is passing legislation which does not suit us; we are not satisfied with it and you must please object to it. No, we are only deciding here that whereas the levy was a halfpenny in the past, it can now be increased to one cent, at the request of the Wool Board and the various woolgrower associations, South West also having its woolgrowers association. What the hon. member is doing this afternoon is to drag into the debate a constitutional issue which has nothing to do with it. I really do not know what the hon. member for Germiston (District) has in mind with this amendment, but to me it seems that he either just wants to display his legal knowledge or he wants to see if he can drive in a wedge between the wool producers obtaining in South West and those in the four other provinces.

I am sorry but I cannot accept the amendment of the hon. member because the intention is to make this increased levy applicable to South West Africa as well. In Section 9 (1) (d) of Act No. 60 of 1952 the word “Union” is defined as including the area of South West Africa, but according to Section 9 (2) to which the hon. member has referred, the provisions of that section only come into operation after the Legislative Assembly of South West Africa have decided accordingly. On a later occasion, in 1955, an additional levy was imposed without provision having been made for it in the form of an amendment similar to the one now moved by the hon. member. In other words on a certain occasion the South West Africa Legislative Assembly decided to subject itself to the provisions of Section 9 (1) (d). I just want to read to the hon. member the resolution which they passed. I am quoting from the Official Gazette of South West Africa, No. 1765 of 15 May 1953 (Government Notice No. 156)—

In other words, South West Africa have already passed a resolution in their Legislative Assembly approving of a wool levy; they have approved of this definition which includes South West in the Union for the purposes of the imposition of a levy and when a further levy was imposed in 1955, apart from the original levy imposed in 1952, it was not necessary for South West Africa to pass a similar resolution, nor did that Act make provision, as did Section 9 (ii) of the 1952 Act, for what the hon. member is now asking. The position is that after they had passed this resolution in 1953, namely, that for the purposes of the Wool Act South West Africa would form part of the Union, any levy that may be imposed or increased can be made applicable to South West because they have already passed a resolution to the effect that for the purposes of this Act South West would form part of the Union, as the law provides, and for this reason I cannot accept this amendment because the intention is to make this increased levy applicable to South West as well. We do not think it is legally necessary to repeat this clause because they have already passed such a resolution. If they had never passed such a resolution, it would have been essential according to the Act of 1944 which the hon. member has quoted here, to do so but they have already resolved that for the purposes of the Wool Act South West Africa would form part of the Union.

I am not going to be misled by the hon. member for Somerset East (Mr. Vosloo) and drag politics into this matter. That is not my intention at all. The position is that in 1925 this Parliament laid down in an Act that—

You did not listen.

I am asking hon. members to listen, particularly hon. members from South West who are present in this House. The argument advanced by the hon. the Minister is not at all in accordance with the facts or in accordance with the Act. The hon. the Minister has referred to the provision which provides that the provisions of the Wool Act, as placed on the Statute Book in 1925, will not be applicable to South West until such time as the Legislative Assembly there resolve that they should apply, and the Minister pointed out that such a resolution had been taken. I grant the hon. the Minister that. But the matter does not end there. It means that the levy, as provided for in the Act of 1925, has been imposed on the wool farmers of South West Africa, but the amendment which is contemplated in the Bill we are discussing to-day, provides that the levy which may not be more than a halfpenny to-day can be increased to one cent. I am sure there is nobody in this House who believes that when the Legislative Assembly decided in 1952 to approve of the levy as it was in that year, their intention was to approve of future levies, whatever they may be, in accordance with an Act passed by this Parliament. It is, therefore, very clear that it is necessary to have this amendment on the Statute Book and if we do not do so, the Government is not entitled to impose that levy on South West, and if they do it will be in conflict with the provisions of the Constitution of South West Africa as accepted by the Parliament of South Africa. I hope the hon. the Minister will respect this entrenchment, as you might call it, which was placed on our State Book in the Constitution of South West Africa by the late Dr. Malan and by Parliament in 1952. I also grant the Minister that if such a proposal is adopted by the Executive Committee and the Legislative Assembly of South West Africa, it may be valid, but I maintain that it is necessary for this Parliament strictly to observe the provisions of the Act and the Constitution of that territory and I hope the hon. the Minister will accept this amendment as I have moved it. I believe it will be in the interests of South Africa and of South West Africa.

I really find it remarkable that where we are dealing with an international article such as wool, where we are dealing with the bread and butter of South Africa, where everybody interested have been consulted and asked whether they were satisfied with this levy, where the National Woolgrowers Association, the mouthpiece of the farmers of South Africa, as well as the Wool Board have approved of this levy, and where the farmers of South West Africa have no objection to this Bill, and where we have been asked by the National Woolgrowers Association and by the Wool Board to introduce this Bill, an amendment should suddenly be moved which will cause all sorts of difficulties. The Act was passed in 1952 and there has been co-operation all this time, I want to ask the hon. member for Germiston (District) (Mr. Tucker) not to concern himself at this moment with minor matters by moving such an amendment as this, an amendment which will only cause delay. The bodies concerned have already approved of the measure. Mr. Speaker, we are very proud of the National Wool-growers Association; it is a body which the wool farmers themselves have created to conduct their own affairs. The wool farmers themselves pay for the research that is regularly carried out. This is an organized body with a wonderful reputation in the world outside. But in spite of the fact that the wool producers themselves have asked for this legislation, the hon. member now tries to cause trouble. [Interjections]. I can see who are the friends of the farmers. Hon. members opposite now want to spoil a good case. I just want to tell them that the wool farmers will never forgive them. The wool farmers have already squared accounts with them. We want to ask the United Party supporters not to drag politics into the wool industry and to leave the wool farmers alone. We have a wonderful organization which controls our affairs and we do not want United Party supporters to interfere. We attend to our own affairs and I am asking the hon. member please to withdraw his amendment.

There is the old axiom that there are none so blind as those who will not see. Sir, although the hon. members are casting quite unwarranted reflections, I am not going to be misled. This is a most serious matter of honouring a provision in our statute placed there by this Parliament. It does not in any way delay this Bill. I am sure the Whips on this side would be agreeable to have the Report Stage taken this afternoon, and so there would be no delay. We are proud of our wool industry. In fact I as an Englishspeaking person whose forebears played a big part in building up our wool industry, am very proud of this industry, but this is not a political question, and I say that when there is a provision of this Parliament on the Statute Book, this Parliament should act in terms of it, and I hope that even at this stage the hon. the Minister will do so. If he will not, he leaves us no alternative but to vote for the amendment.

I just want to tell the hon. member that our legal advisers are of the opinion that after the resolution was passed by South West Africa in 1952 the provision of the 1949 Act is not applicable to the Wool Act. Consequently when a new levy was imposed in 1955 for stabilization fund purposes, it was not considered necessary to get further approval by the Legislative Assembly of South West Africa by way of a resolution. The legal advisers are of the general opinion that it is not necessary to do so on this occasion, because as far as this Act is concerned, they have already passed such a resolution. But if it will satisfy the hon. member I am prepared to go so far as to promise that I will once again consult the legal advisers and ascertain whether it is necessary to make such an amendment to the Act or whether a clause should be inserted as suggested by the hon. member. If it appears that is necessary I undertake to do so in the Other Place. But according to legal opinion it is not necessary to accept such an amendment.

I thank the Minister for his promise. I trust he will also get in touch with the Executive Assembly of South West Africa because I am convinced the legal opinion that he has received is not correct. This is a matter which affects the constitution and the Opposition will have to do its duty and call for a division on this matter.

Amendment put and the Committee divided:

AYES—39: Barnett, C.; Bowker, T. B.; Bronkhorst, H. J.; Cadman, R. M.; Connan, J. M.; Cronje, F. J. C.; de Kock, H. C.; Dodds, P. R.; Emdin, S.; Field, A. N.; Fisher, E. L.; Gay, L. C.; Gorshel, A.; Henwood, B. H.; Hickman, T.; Higgerty, J. W.; Hughes, T. G.; Lewis, H.; Malan, E. G.; Mitchell, D. E.; Mitchell, M. L.; Odell, H. G. O.; Oldfield, G. N.; Plewman, R. P.; Radford, A.; Raw, W. V.; Ross, D. G.; Russell, J. H.; Steenkamp, L. S.; Steyn, S. J. M.; Streicher, D. M.; Swart, H. G.; Taurog, L. B.; Tucker, H.; Waterson, S. F.; Weiss, U. M.; Wood, L. F.

Tellers: N. G. Eaton and A. Hopewell.

NOES—84: Badenhorst, F. H.; Bekker, G. F. H.; Bekker, M. J. H.; Bezuidenhout, G. P. C.; Bootha, L. J. C.; Botha, H. J.; Botha, P. W.; Botha, S. P.; Coertze, L. I.; Coetzee, B.; Cruywagen, W. A.; de Wet, C.; Diederichs, N.; du Plessis, H. R. H.; Fouché, J. J. (Snr.); Frank, S.; Grobler, M. S. F.; Hertzog, A.; Heystek, J.; Hiemstra, E. C. A.; Jurgens, J. C.; Keyter, H. C. A.; Knobel, G. J.; Kotzé, G. P.; Kotzé, S. F.; Labuschagne, J. S.: le Roux, P. M. K.; Loots, J. J.; Louw, E. H.; Luttig, H. G.; Malan, A. I.; Malan, W. C.; Marais, J. A.; Marais, P. S.; Maree, G. de K.; Martins, H. E.; Meyer, T.; Mostert, D. J. J.; Mulder, C. P.; Muller, S. L.; Nel, J. A. F.; Nel, M. D. C. de W.; Niemand. F. J.; Otto, J. C.; Potgieter, D. J.; Potgieter, J. E.; Sadie, N. C. van R.; Sauer, P. O.; Schlebusch, J. A.; Schoeman, B. J.; Schoonbee, J. F.; Smit, H. H.; Stander, A. H.; Steyn, F. S.; Steyn, J. H.; Treurnicht, N. F.; Uys, D. C. H.; van den Berg, G. P.; van den Berg, M. J.; van den Heever, D. J. G.; van der Ahee, H. H.; van der Merwe, J. A.; van der Merwe, P. S.; van der Walt, B. J.; van der Wath, J. G. H.; van Eeden, F. J.; van Nieker, G. L. H.; van Nierop, P. J.; van Rensburg, M. C. G. J.; van Staden, J. W.; van Wyk, G. H.; van Wyk, H. J.; van Zyl, J. J. B.; Venter, W. L. D. M.; Verwoerd, H. F.; Viljoen, M.; Visse, J. H.; von Moltke, J. von S.; Vorster, B. J.; Vosloo, A. H.; Waring, F. W.; Wentzel, J. J.

Tellers: W. H. Faurie and J. J. Fouché.

Amendment accordingly negatived.

Clause, as printed, put and greed to.

Remaining Clauses and Title of the Bill put and agreed to.

House Resumed:

Bill reported without amendment.

This clause deals with an increase of the levy, that is to say an increase of the Stabilization Fund. I am not raising any objection to this and this side of the House has already accepted the principle, and furthermore, the farmers have agreed to it, and I do not think that the fact that we are dealing with decimals requires any comment. But the matter I want to deal with is one which I feel is of very great importance to the farming community as a whole. It is the position which has now been reached where the Stabilization Fund itself has reached the enormous sum of R21,000,000. Now, Sir, looking at this in the light of the average value of our wool clip of approximately R100,000,000, it would seem that we have now arrived at the stage where the Minister can well feel that the object which the producers, the founders of the scheme had in mind— and here I think we must all compliment them for the wonderful way in which they stuck to the undertaking and continued their contributions to this fund over all these years—has been achieved. We cannot lose sight of the fact that the founders originally never envisaged a fund so large that it might be able to buy the whole wool clip of South Africa during a period in which we might have a catastrophe, or a depression as far as wool is concerned. I do not see any prospect of that at this stage; my confidence in wool is too deep-founded—but if we were faced with a real depression, then of course this fund would be of no value at all. I would again refer back to the intention of the founders. It was never their intention to meet a position where the market would collapse, but rather to meet those fluctuations to which the wool market of the world is so prone. I have said it in the past, and I say it again, that the wool market is a very sensitive market and it does fluctuate as a result of the least disturbance, it might be as a result of currency troubles, or a strike, or other difficulties. Those dips in the market can well be covered by this fund, and that is exactly the purpose of the fund, and it has done its job already very successfully because it has carried us over those periods of fluctuation which cannot be described as a slump. Now I want to stress that we continue to take out of the farmers a considerable sum. I am not referring to the ordinary levy which is applied, and I know the hon. the Minister would not very readily apply it to the full extent, because it would take some R3,000,000, but if the levy we are dealing with now were applied, it would take R1,500,000. Collectively it would mean R4,500,000 out of the economy of the farmer—if the Minister were so unwise to allow it to be applied. Sir, the producer (like all other industries) has to face an upward increase in the marketing costs of his produce. Here I am dealing with one particular burden. We have a fund here which has been built up for the protection of his markets, and we have now reached the stage where we have 21 per cent cover as it were on a clip which realizes R100,000,000. Now in the ordinary run of commerce, R21,000,000 could very easily buy R100,000,000 clip. Finances could readily be obtained for the balance through banks and financial institutions.

We do not want to buy on tick.

The hon. member will have an opportunity to take part in the debate, and I should like to hear him on this subject. The point is that if we do not arrive at a period where the Minister will determine that he has got a maximum fund, you will continually from year to year take from the producer R1,500,000, because this levy I understand now is a fixed levy and we merely have here an increase on the present levy of R200,000 a year. I take it that is the approximate increase that will go to the Stabilization Fund. My contention is that amount of money could well be left with the producer. We want a shot in the arm in trade in general in the country and just that amount can make a lot of difference. You have a fund standing now at R21,000,000 and I honestly feel that the time has arrived where the Minister should take the necessary action to see that a maximum for the fund is set. I am encouraged to advocate this because I noticed in the Select Committee on Public Accounts this matter also received attention, and I only want to read the paragraph which is relevant—

This deals with levy funds and the Committee has very rightly raised this matter and considers that it should be carefully considered by the boards concerned.

I come back to my original point. When this scheme was introduced hon. members were perhaps interested in the scheme. I myself was vitally interested in the scheme and gave it very full support, because I thought it was a very good idea, to have this scheme. But at this stage it seems to me very wrong indeed to call upon the producer to continue building up this fund where it has already been proved that the fund is sufficient to carry the producer through just those periods of fluctuations we have to contend with from time to time. If on the other hand anybody holds the idea that they should continue to build up this fund until you might have a fund equal to the average value of the wool clip, then I must say that seems to me absurd. We have lost markets, we have lost the market in China, in Russia, in East Germany. I know why and there is no member here who does not know the reason. Immediately after Sharpeville we were told that our Chinese business was cancelled and our Russian business was cancelled. We will hope of course that all these things will come right again, but should a catastrophe befall us and should our main customers decide not to buy as a result of the actions of this Government, then you must not call on the farmers to carry the loss, then it is a national matter and the Government would have to help. I contend it is grossly unfair to continue to take levies from the producers to build up a fund in this way and to put the money into cold storage, because that is virtually what it amounts to. It is probably being invested in such a way that we get a small interest on the fund, but I say again that at this stage the Minister should take recognition of this plea and give it very ready consideration with a view to suspend this levy.

Order! That is not under discussion now.

Sir, I am dealing with one aspect of this fund.

It is a question of raising it from ½d. to ½ cent.

Yes, Sir, but will you allow me to say just this that I am not opposing the raising of the fund, but I consider that the time has arisen where we have established what we set out to do and where there is sufficient money to give support to the market when there are these ordinary fluctuations.

Clause put and agreed to.

Remaining clauses and Title of the Bill put and agreed to.

House Resumed:

Bill reported without amendment.