House of Assembly: Vol2 - TUESDAY 13 MARCH 1962
For oral reply.
asked the Minister of the Interior:
Whether he will make a statement on the banning of the book A World of Strangers by Nadine Gordimer.
Yes. It is regretted that because of a departmental oversight it was not stated in the Government Notice announcing the prohibition on the importation and circulation of the book, A World of Strangers by Nadine Gordimer, that the prohibition only applies to the soft cover edition of the book. A notice correcting this error will be published in the Government Gazette within the near future.
I may add for the information of the hon. member that well over 2,000 publications are dealt with every year and it is therefore not surprising that errors of the above kind occur now and again.
asked the Minister of Lands:
- (1) How many holdings under the Sand-Vet settlement scheme (a) will be available for allotment and (b) have already been allotted;
- (2) what percentage of the holdings have been allotted to applicants who were or are connected with the mining industry as miners;
- (3) whether the holdings that have so far been allotted, have been allotted only to citizens of the Republic; if not, (a) to what other persons have holdings been allotted and (b) on what grounds; and
- (4) whether the financial assets of an applicant are a consideration in allotting holdings; if so, what is the minimum requirement.
- (a) Approximately 400 holdings.
- (b) 40 holdings.
- (2) 7½ per cent.
- (3) No.
- (a) and (b) In one case a holding was allotted to an immigrant, who was considered suitable on the grounds of his assets and his general farming experience, especially his achievements on a small piece of land leased elsewhere.
- (4) Yes. No general minimum requirement has been laid down, but each selection committee determines the amount which, in its opinion, will be required by an applicant, under the particular circumstances pertaining to the holdings to be allotted, to provide necessities until the first income from the holding becomes available.
asked the Minister of Mines:
- (1) How many miners were certified as pneumoconiosis sufferers in the first, second, third and fourth stage, respectively, during 1961;
- (2) what amounts were paid out of the Controlled Mines Compensation Fund to miners suffering from pneumoconiosis in the first, second, third and fourth stage, respectively, during 1961; and
- (a) what amount was paid in levies by mine owners during 1961; and
- (b) what amount of the levies were paid out in respect of 1960.
- (1) 282 (1st Stage);
186 (2nd Stage);
146 (3rd Stage);
131 (4th Stage).
- (2) R324,382 (1st Stage);
R1,055,603 (2nd Stage);
R771,797 (3rd Stage);
R175,358 (4th Stage).
(a) By owners of Group A-Mines— R1,000,000.
By owners of Group B-Mines— R375,764.
(b) It is not clear what information is desired under this part of the question as the amount levied in any year is not necessarily determined by or levied in respect of the benefits payable in that year or paid during the preceding year.
Of the amount of R1,000,000 collected from Group-A Mines in 1961, an amount of R995,199 was credited to those mines as a result of a surplus found in the fund at the 1959-60 valuation.
asked the Minister of Finance:
- (1) Whether, as reported in the Cape Argus of 3 March 1962, an inspection of the books of account of the Farmers Bank Ltd., was carried out at the instance of the Registrar of Banks; if so, (a) what are the names and qualifications of the person or persons entrusted with the inspection, (b) when was the inspection carried out and (c) when was the report on the inspection submitted to the Registrar;
- (2) whether this banking institution has rendered to the Registrar of Banks a balance sheet and accounts for the year ended June 1961; if so, on what date; if not, (a) what steps have been taken to obtain submission of the balance sheet and accounts and (b) with what results;
- (3) whether the Registrar gave approval for the amalgamation with this institution of certain other finance institutions, as reported in the Press; if so, (a) when was approval granted and (b) on what terms and conditions; if not, why not;
- (4) whether the salient findings of the inspectors will be published; and, if not,
- (5) whether he will make a statement in regard to the scope of the inspection and the action taken thereon.
- (a) The firm of Brink, Roos and du Toit, Chartered Accountant, Johannesburg, was entrusted with the inspection, and Mr. D. J. du Preez, B.Com., C.A.(S.A.), a partner in that firm, conducted the inspection.
- (b) Between 5 May 1961 and 31 August 1961.
- (c) 15 September 1961.
- (2) No. A banking institution is not obliged to render its annual balance sheet and accounts to the Registrar of Banks until such balance sheet and accounts are submitted to its shareholders. As no balance sheet and accounts in respect of the year ended June 1961, have yet been submitted by the Farmers Bank to its shareholders, no statutory obligation to render them to the Registrar of Banks has arisen. However, a request that the institution submit the relevant balance sheet and accounts to the Registrar of Banks was addressed to the institution on 18 September 1961. but met with no response
- (3) Yes.
- (a) The proposal was approved in prin ciple on 29 November 1961.
- (b) The terms and conditions on which approval was granted were those embodied in the amalgamation proposal submitted to the Registrar of Banks by a finance institution, and which visualized the amalgamation with the institution concerned of The Farmers’ Bank and four other banking institutions, on the following basis:
- (i) the directorates of the six institutions were to be interlinked;
- (ii) the directorates as reconstituted would examine the affairs of the individual banking institutions with a view to their ultimate merger;
- (iii) the merger would be effected by the sale of the shares of the institutions involved to a single holding company at prices to be determined by independent accountants;
- (iv) the paid-up capital of the holding company would be approximately double the capital and reserve resources of the six institutions combined and the issue would be underwritten to the satisfaction of the Registrar of Banks; and
- (v) the managing director of the institution which submitted the proposal was to be appointed as sole managing director of The Farmers’ Bank and was to report monthly on the progress made in improving the administration of the institution and on his findings in regard to the matters raised in the inspection report.
- (4) No, the report is not a public document.
- (5) The Farmers’ Bank is now under provisional judicial management and its creditors will receive information relating to its affairs in the normal course. Accordingly, I do not propose to make any statement in regard to the scope of the inspection and the action taken thereon.
asked the Minister of Transport:
- (1) Whether there is a radio beam directional guide or radar system at the Queenstown airport; and
- (2) what other facilities exist at this airport for guiding aircraft to land in bad weather.
- (1) No.
- (2) Nil.
asked the Minister of Transport:
Whether Dakota aircraft of the South African Airways are equipped to make use of a radio beam directional guide or radar system; and, if not, why not.
Yes; Dakota aircraft of South African Airways are equipped to make use of a radio beam directional guide and of ground radar systems, but if the hon. member has in mind the unfortunate Dakota accident on 6 March 1962, I should mention that neither Queenstown nor Grahamstown aerodrome is equipped with either radio beacon or ground radar.
asked the Minister of Bantu Administration and Development:
Whether the Government has provided motor-cars to (a) Territorial, (b) Regional and (c) other Bantu Authorities; and, if so, (i) to which authorities, (ii) for what purposes and (iii) what is the make and cost of each car.
(a), (b) and (c) No.
The remainder of the hon. member’s question falls away.
Arising out of the reply of the hon. the Minister, when he informs us that there are no such motor-cars, is he aware of the fact that in the official publication of the Department of Information “The Digest of South African Affairs”, a report appears of a speech in which he stated …
Will the hon. member please Table his question.
asked the Minister of Social Welfare and Pensions:
Whether any progress has been made by his Department with the establishment of (a) attendance and (b) observation centres as provided for in the Children’s Act; if so, what progress; and, if not, why not.
- (a) Arrangements for the establishment of an attendance centre in Johannesburg are in the final stages.
- (b) An observation centre has been operating in Pretoria for the past seven months. In Johannesburg a similar centre is in embryo stage and will be developed gradually in the light of experience gained.
asked the Minister of Posts and Telegraphs:
- (1) (a) How many private boxes are there at the main post office in Durban and (b) how many additional boxes have been provided during the past five years;
- (2) whether there is a waiting list of applicants for private boxes at this post office; if so, how many names are on the waiting list; and
- (3) whether additional private boxes are to be provided; if so, (a) when and (b) how many.
- (1) (a) 2,850 and (b) nil;
- (2) yes; 560; and
- (3) yes; (a) and (b) it is expected that tenders for the installation of 1,050 additional private boxes will be invited within two to four weeks and the boxes should be available for letting after a few months.
asked the Minister of Posts and Telegraphs:
Whether any progress has been made in regard to the erection of a new main post office in Durban; and, if so, what progress.
Provision exists in the Department’s priority list of major works for the erection of a new main post office in Durban. The present gaol site in Pine Street opposite the proposed new railway station is best situated for this purpose and a portion thereof is intended to house the building. Before the site will be available for the erection of the post office, it is necessary for the gaol to be established elsewhere and steps are still being taken by those concerned to acquire a suitable site for the new gaol.
The MINISTER OF WATER AFFAIRS replied to Question No. *III, by Mr. Durrant, standing over from 9 March.
- (1) Whether he has received any representations in regard to the Boskop Dam on the Krokodil River in the district of Rustenburg; if so, (a) from whom, (b) what was the nature of the representations and (c) what was his reply; and
- (2) whether his Department has recently carried out any investigations in regard to this dam; if so, what were the results of the investigation.
- (1) Yes;
- (a) a deputation representing the Municipality of Rustenburg, the Thabazimbi Health Board, the Rustenburg Chamber of Commerce and farming interests along the Krokodil River;
- (b) that the proposed Boskop Dam be constructed by the State; and
- (c) that the site of the proposed Boskop Dam is unsuitable on account of dolomite formation and that the possibility of constructing alternative dams on the branches of the Krokodil River is being investigated by the Department of Water Affairs; and
- (2) no; the investigations of the Department of Water Affairs were made in 1936 and 1953 and various geological investigations were made from 1937 to 1955. The results of the investigations were that the geologists could give no guarantee that the dam would be watertight, that the cost of the dam would be excessive and that the Department of Water Affairs would take a definite risk by constructing the dam wall on dolomite and by storing the water on dolomite.
The MINISTER OF FINANCE replied to Question No. *VI, by Mr. Plewman, standing over from 9 March.
- (1) Whether his attention has been drawn to a report in the Southern Africa Financial Mail of 16 February 1962, that the Registrar of Insurance was instrumental in bringing about the reinsurance agreement between the registered insurer and the third insurance company referred to in the Minister’s statement on 6 March 1962;
- (2) whether the Registrar took this action with the approval of the Treasury; and
- (3) under what statutory powers did the Registrar take this action.
- (1) Yes.
- (2) No. the Insurance Act does not require the Registrar to exercise his functions subject to the Treasury’s approval.
- (3) The Registrar acted under no specific statutory provision. His action was taken, however, in consonance with the general aim of the Insurance Act, namely, to protect the interest of policy holders.
I move as an unopposed motion—
That the resolution, adopted by the House on 1 March 1962, referring the Powers and Privileges of Parliament Bill to a Select Committee in terms of Standing Order No. 185 (1), be rescinded.
I move as an unopposed motion—
That the First Reading of the Bill be discharged and the Bill withdrawn.
Bill read a first time and in terms of Standing Order No. 185 (1), be referred to a Select Committee for examination and report as to whether it in any way alters the existing law, the Committee to have power to take evidence and call for papers.
I wish to raise a personal point of explanation. I understand exception was taken to a word I used in yesterday’s debate when, speaking in the full flood of my indignation about the Railway Board. I said—
I wish unreservedly to withdraw the word “sordid”. May I say this to the Minister, about the Board (with apologies to Omar Khayyam)
Re-mould it nearer to our Hearts’ Desire!
First Order read: Adjourned debate on motion for House to go into Committee of Supply on Estimates of Expenditure from Railway and Harbour Fund, to be resumed.
[Debate on motion by the Minister of Transport, upon which an Amendment had been moved by Mr. Russell, adjourned on 12 March, resumed.]
Mr. Speaker, when the debate was adjourned last night I had referred to the practically unparalleled record of safety of the S.A. Airways and I had given certain reasons why the Airways had had such an outstanding record of safety. I indicated that we were using of the best and of the safest aircraft and that the training which the personnel of the S.A. Airways received was of the highest standard found in any air service. I want to refer to one special part of their training namely the Viscount simulator which is used to acquaint the pilot with the control system of the Viscount. This simulator costs R160,000. It is calculated that a pilot has to have approximately five hours’ experience on it before he is able to handle a Viscount efficiently. That means a terrific saving, apart from its efficacy, because a pilot would otherwise have to be trained at approximately R800 per hour for five hours, and together with the 50 personnel members who are required, it would mean more than R200,000. In this respect, therefore, a saving is being effected, apart from its efficacy. An interesting feature about this simulator is that it imitates the circumstances which prevail in the control cabin or an aircraft so effectively that when the pilot has to make a calculation that would have caused an accident, the lights go out, the instruments stop functioning, you no longer hear the noises of the engine and you hear a bang. In other words, it is particularly effective and efficient.
The other aids which are used by the Airways contribute greatly to its increased safety as well. This is really a compliment which I should pay to the colleague of the hon. the Minister of Railways, namely the hon. the Minister of Transport; however, I leave the matter there. I just want to refer to one very interesting fact, and that is that indirectly we are benefiting by America’s research into space in that weather information which is picked up by space by Tyros III, the weather satellite of the U.S.A., is available in Nairobi. It takes photographs of cloud formations around the earth which are interpreted in order to predict the weather, and those reports are made available to our aircraft which pass through Nairobi.
Last but not least I want to pay tribute to the staff of the Airways. From those in command down to the most humble steward we find the greatest helpfulness, friendliness and the most pleasant attention which anyone can hope to receive. [Interjections]. I agree heartily with hon. members. Recently it was my privilege to have an American tourist as my co-passenger and he told me that he travelled extensively by air and that nowhere in the world had he come across an air service which is more pleasant to travel on than the South African air service. We wish the Minister and his staff of the Airways success and thank them sincerely. Where we are on the threshold of big developments in air traffic throughout the world. I want to express the hope that we shall continue to keep pace with that development as we have done in the past. By 1970 there ought to be passenger aircraft which fly at twice the speed of sound. They are already working on a passenger aircraft with a speed of, Mach. 3, that is to say, three times the speed of sound. The Russians already have an atom propelled aircraft of 195 feet in length with a wing span of 78 feet and with a driving power of 70,000 lbs. per motor which, if successful, will probably be able to remain in the air for a few weeks or a few months. Development is taking place at such a pace that when you read about it, you think you are reading fictitious scientific literature.
I want to conclude by conveying my gratitude to the Minister and the staff of the S.A. Airways for the outstanding service which they are rendering South Africa and to wish them every success in what they do in the future.
With reference to the criticism of the hon. member for Wynberg (Mr. Russell) of the fact that the Minister budgeted in his 1961-62 Budget for a deficit of R507,200 and then converted it into a surplus of R8.5 million, I just want to take the hon. member for Wynberg to task once again—he is not there at the moment—and remind him that if the Minister had accepted his good advice and recommendations, particularly at the third reading of the Railway Appropriation Bill, we would definitely have been saddled to-day with a deficit of quite a few million rand. The reason for that, of course, is that the hon. member thought, after the hon. the Prime Minister had withdrawn South Africa’s application for membership of the Commonwealth, that meant the end of South Africa. But I can well understand why the hon. member was pessimistic and why he felt so absolutely lost and believed that now that we were no longer in the Commonwealth, it meant the end of the Railways and bankruptcy for the Republic. I hope that the hon. member feels a little ashamed of himself to-day for having been such a prophet of doom, but the trouble is that the hon. member cannot help himself; he has no faith in himself and he has no faith in his own country. He has no faith in the industrial, commercial and agricultural development of this country, and what I particularly cannot understand about the hon. member is that he is held in high esteem in the Chamber of Commerce. At one time he was even on their Executive Committee. One asks oneself what the Chamber of Commerce did with such a pessimist on their Executive Committee. I can understand very well that one must have a good Opposition, and I think the Minister would welcome an Opposition that comes forward with constructive criticism. Here I am thinking, for example, of the Opposition’s former first speaker in Railway debates, Mr. Pocock. In the days when he sat here I can well remember that when he offered criticism he gave praise where praise was due and his criticism was constructive But what is the position in the case of the hon. member for Wynberg? In the past few years we have had nothing but continual abuse from him and non-constructive criticism. After having sat here for hours listening to Opposition members and to their attempts to attack the Minister of Transport and his Budget, I think we can adopt an entirely different attitude now and talk about not “ministerial and managerial inefficiency” but of “Opposition inefficiency”.
The Minister is being attacked here because he originally budgeted for a deficit of R507,200 and because that deficit has been converted into a surplus of R8.5 million. The hon. member then proceeds to deliver himself of the following wisdom; he says, “I can understand that the Minister cannot estimate revenue correctly in advance, but what I cannot understand is that the Minister is so far out with his estimate of expenditure.” Mr. Speaker, have you ever heard that sort of wisdom—and that coming from an accountant? Every fool knows that if your revenue exceeds your expectations, it stands to reason that your expenditure must rise accordingly. And the hon. member says this after the Minister has specifically pointed out in his Budget speech that in spite of the fact that there has been more traffic, expenditure has not increased at the same rate as revenue, a fact which provides proof of the sound planning and management of the Railways. But, after all, years ago the United Party also governed this country for a while. It is true that it was 14 years ago, and viewed in the light of what is happening in this modern world of ours, that is a very long time ago of course, and I do not blame the hon. member for Turffontein (Mr. Durrant) at all for asking here yesterday evening why we were going back so far into the past. But they also introduced Budgets; let us see how they budgeted. The hon. member for Bloemfontein (East) (Mr. van Rensburg) set out the position very clearly here last year and very strongly reproached the hon. member for Wynberg, who had then advanced the same argument, but I suppose the pill was too bitter for him to swallow; he did not swallow it and that is why he has come forward with the same argument this year again. Let us see how the United Party budgeted when they were responsible for the Railways.
When Mr. Sturrock was Minister of Railways, he budgeted in 1941-2 for a surplus of R44,864 arid his actual surplus was R12,084,000. In 1946-7 he budgeted for a deficit of R100,000 and he closed the financial year with a surplus of R281,432. In 1955-6 he budgeted for a surplus of R38,000 and he closed the year with a deficit of R3,740,000. In 1947-8 he budgeted for a surplus of R124,000 and he closed the year with a deficit of R1.2 million. I hope that now at least the hon. member for Wynberg will realize that no Minister of Transport is omniscient and that his Budget is influenced by economic fluctuations and factors over which he has no control.
But now the hon. member comes along with a further accusation. The hon. member for Wynberg also had some venomous criticism to offer the poor budgeting on the part of the Minister in connection with his Loan Estimates. Last year, in 1961-2, the Minister budgeted for R85,000,000 and he used only R60,000,000, leaving about R20,000,000 unused. The hon. member now comes along with the argument that the other Government Departments have been prejudiced to the tune of R20,000,000. But does the hon. member not know how a Budget is drawn up, how the Minister of Finance Budgets? Every Department gets its share in the Budget and if one Department does not use its full share, as in the case of the Railways this year, it does not mean at all that the other Departments are prejudiced or that the money lies in the State covers without earning interest, which is the impression that he tried to create. The Treasury simply provides the amounts as and when they are needed by the Railways or any other Department, and the money is usually drawn out of short-term loans. But I want to point out to the hon. member that in 1960-1 the Loan Estimates amounted to R132,000,000 and that of that sum an amount of R49.6 million remained unused. But does the hon. member not realize and does the Opposition not realize that these things worried the Minister of Transport and that he felt that something should be done about it and that he then proceeded to do so? He did so when he brought about the entire reorganization of the Railways, a step which coincided with the appointment of the new General Manager of Railways, Mr. Hugo, in March 1961. It seems to me that the Opposition does not know much about this, and I have decided therefore to give them a brief outline to show how the Railways are controlled. I think that it is necessary to do so, particularly for the edification of the hon. member for Turffontein, because the hon. member talks a great deal although he does not always know what he is talking about. To-day the position is—and this has been the position since March of last year —that there is a General Manager of Railways with two Deputy General Managers, one being the Deputy General Manager (Finance, Planning and Operating) and the other Deputy General Manager (Staff and Commerce). Apart from them there are five Assistant General Managers. The first is the Assistant General Manager (Airways); the second is the Assistant General Manager (Operating and Road Transport); the third is the Assistant General Manager (Technical); the fourth is the Assistant General Manager (Commerce) and the fifth is the Assistant General Manager (Staff). Then there are also five heads of departments. The first head is the Chief Mechanical Engineer, who is at the head of all the workshops. The second is the Chief Civil Engineer, who is at the head of all works and expansion. The third head is the Financial Manager, who is the watch-dog over the finances of the Railways. The fourth head is the Head of Planning and Productivity, and the fifth is the Chief Law Adviser. In addition to that we still have the Railway Service Commission, which consists of three members with an appointed chairman. The Railway Service Commission is responsible for seeing that promotions are made on a fair basis. Then we have a member like the hon. member for Orange Grove (Mr. E. G. Malan). Sir, if ever an hon. member revealed his ignorance in this House, this hon. member did so yesterday evening. He comes here with a statement that irregularities are taking place in connection with promotions of the staff, and he bases this on United Party stories which he accepts as gospel. I can assure him that promotions of railwaymen take place on a very fair basis and that the matter is gone into thoroughly. I myself have experience of a case where a member of the staff was promoted per incuriam to a position to which he was not entitled, and I know how soon his subordinates lodged an appeal; they win their appeal and the matter is then rectified. Sir, there you have the whole administrative machine of the Railway Administration, and those men are no fools (“pampoene”); they are men who know their work. They are specialists in their own fields. There you have the administrative machine which is responsible for the safe and efficient functioning of the railways, which is so important, the efficient functioning of road transport, of the Airways and the harbour service, and the person at the helm is His Honour Minister Ben Schoeman, Minister of the National Party Government.
I want to come back now to the Loan Estimates. I can give the hon. member for Wynberg the assurance that, with the thorough planning and budgetry control, he will notice that in the future the planning and the budgeting will take place with greater accuracy, and that a very small portion of the money provided in the Loan Estimates will remain unused. I want to point out that in 1960-1 37 per cent of the money provided in the Loan Estimates was not used for expansion, and in the case of the latest budget, for the year 1961-2, only 24 per cent of the money provided in the Loan Estimates was unused, which already represents an improvement of 13 per cent. But, instead of praising the Minister, the hon. member for Wynberg comes along with this sordid attack in connection with the Railway Commission.
Is the hon. member in order in using that word?
But, after the very clear exposition given here by the hon. member for Bloemfontein (East) as to what happened under United Party rule, I have heard no further comment from that side, and I do not think that there will be any further comment from them. If I may give the Opposition some good advice …
On a point of order, the hon. member used the word “smerig” (sordid). Is that parliamentary language?
Did the hon. member use the word “smerig”?
Yes, it is so long ago that I can hardly remember using the word. I did use it; I am sorry, and I withdraw it. Let me rather say then that it was a scandalous attack.
If I may give the Opposition some good advice. I would advise them rather to be appreciative of what is being done here, not only by the Minister, but the whole of the management; that they should rather come forward with constructive criticism which will be to the benefit of the whole country. What I find very interesting is that the Opposition is supposedly so concerned about the unjust way in which the Minister, according to them, is treating the artisans in the Railway Service.
It is not only the artisans.
The hon. member for Turffontein (Mr. Durrant) says that does not apply to the artisans only, but to all the White members of the Railway staff. I find that very interesting. I personally feel very sorry about the irresponsible resolutions which have been passed by some of the artisans’ associations in connection with the Minister, because I know, and every White railwayman knows, that there never has been a Minister who has looked after their interests better than the present Minister. Let me say very candidly to the Opposition that the Minister and his staff will eventually come to an agreement, just as they have done in the past. I am thinking of the days before the election of 1958, when there were go-slow strikes. At that time the Minister said to the staff: “I am not going to allow myself to be bought by votes; I am going to act in a responsible way,” and he did, and, after the election, he gave the staff wage increases. He did not make promises, as the United Party does. I also want to make it perfectly clear that the White railway servant has no faith in the United Party, and they may as well keep their noses out of the arrangements between the staff and the Minister as far as wages and salaries are concerned, because they will not be able to make any contribution. I want to say here that if the present United Party or the Progressive Party should ever come into power— which will never happen, of course—it will be the end of the White railway servant. Because is it not that party which does not believe in group areas and in separate residential areas? What are they going to do with the White railway workers? Are they to live amongst the Coloureds and the non-Whites? Are they not the people who say that they are against job reservation? Are they not the people who say that they stand for the rate for the job or equal pay for equal work? The White railway servant knows this, and that is why I want to say this to the United Party, if I may give them some good advice: Let them save their breath to cool their porridge to-morrow morning; the railwaymen will take no notice of the promises of the United Party. Sir, the hon. member for Wynberg goes even further. If I remember correctly, at one time he was also a member of the Progressive Party. And what is the policy of the Progressive Party? Their policy is that the colour of a man does not count; all that counts is merit, and I say here this afternoon that if the United Party and these members of the United Party with Progressive leanings came into power, we would have a cheap railway service, staffed, not by White railway servants, but by non-White and Coloured railway servants.
Yes, it hurts, but that is the truth. I am very grateful for the fact that the Minister has announced in his budget speech that there are to be certain adjustments in the initial salaries of recruits for whom there are quite a number of vacancies, and that he has made provision for an additional expenditure of R250,000 a year.
I want to put forward a plea here this afternoon for the shunters on the Railways. I do not think that in the whole of the Railway Service there is more dangerous work than that of the shunter. I could mention tragic cases to the House this afternoon. There was a case at Bethlehem again the other day where one of the shunters disappeared while they were shunting. When they eventually found him, he was lying under the train in bits and pieces. I want to ask the Minister to pay these members of the staff a special risk allowance, a risk allowance which will be payable while they remain shunters, but which will fall away as soon as they are promoted to the position of conductor or some other position.
My time has almost expired, but I do feel that it has become a tradition here to dance for a moment with the hon. member for Drakensberg (Mrs. S. M. van Niekerk)—not Danskraal. Unfortunately, she is not here. I do not know whether I should dance the bop or the cha-cha or the new twist with her, but whatever dance it may be, I just want to say to the hon. member that every game has its rules, and I think one of the rules in dancing is that one should not tramp on another person’s foot with one’s steel heel. That is why I want to correct the hon. member here. She made a very unfair statement here. She said amongst other things that, so far, four Government speakers had spoken, and that it was only the hon. member for Parow (Mr. S. F. Kotzé) who devoted two and a half minutes to the problems of the artisans. But that is not true. The hon. member for Bloemfontein (East) devoted practically half of his speech to this matter, and, amongst other things, he also pointed out that the Minister had budgeted for an additional R2,750,000 to meet the demand that the 1958 N.P.A. (nonpensionable allowance)—which hon. members call the Nationalist Party allowance—should be consolidated. This is at least an allowance which has not been withdrawn again like the Jagger allowance. That S.A.P. allowance I still remember very well. As far as Danskraal is concerned, I want to give this advice to the hon. member that, if she looks at the Brown Book for a moment, she will notice that, under Heads Nos. 139, 691. 692, 693 and 694, amounts totalling R77,612 have been set aside in these Estimates, and that money is being spent on the conversion of the terrain, on new offices, better working facilities for the staff, and, under Head 694, money is to be voted for new toilet rooms. I want to say to the hon. member that it is no use her posing here as the only person who is fighting to promote the interests of the railwaymen. It was not she who secured these improvements; it was the Planning Council which recommended these improvements; the whole thing had to be planned, and the Minister’s policy is to provide better facilities for the railway servants.
It was as the result of her representation.
I want to conclude with a word of thanks and appreciation to the Minister and to the management and to every rail-way servant who has loyally rendered his services, sometimes under very difficult circumstances, in wind and. in rain, to make a huge success of the S.A. Railways. But I should like to express my gratitude and appreciation in particular to the wife of the railway servant, the wife who does not draw a salary, who is not an official, but who has to stand by her husband through thick and thin. Hon. members laugh, but those people who know anything about the railways will realize that woman has to pack tins of food for her husband if he is a member of the train staff; when her husband has been on duty the whole night, she has to keep the children quiet during the day so that he can sleep; when he comes home overworked, feeling on edge and moody, she has to show love and encouragement. Once again my thanks and gratitude to the wife of the railway servant.
The speech of the hon. member who has just sat down contained mainly personalities, and he gave what seemed to me rather questionable or faint praise to the Administration’s staff when he chose to tell the House that they were not “pampoene”. There is no need to comment further on his speech. But I can follow on the remarks of the hon. member for Bethel-Middelberg (Mr. J. W. Rall) to this extent by saying that there is much that stands to the credit of the S.A. Railways, Airways and Harbours of which the Administration and the Minister are entitled to be proud. But a due share of the credit for what has been achieved, must of course also go to the large body of railwaymen. Services and equipment have been modernized in many ways and travelling has been made more comfortable and generally safer. One gives due recognition to the Administration for those benefits in a debate of this nature; one gives credit where credit is due. But it would, or course, be tragic if such credit could not be given and had not been earned because (a) the whole of the resources of the Government are behind this State undertaking and (b) the economy of the country as a whole is dependent in a great measure on the successful management of this State-owned monopoly.
Looking at the figures placed before us, as one naturally must in a Budget debate, one realizes that these benefits and improvements have been acquired at some considerable cost to the public in general and to the railway user in particular. One is obliged therefore in looking at the results to test by way of inquiry and probing whether there has also been improvement in efficiency on the part of the Managment and also a sufficiency of financial control on the part of the Minister and the Board. Probing results in that way does not imply that one tries to belittle improvements or that one tries to criticize for the sake of criticism because, as other members on this side of the House have indicated, much of the good that has been achieved thus far was set on its course by criticism from this side of the House.
I want to direct my probing mainly at the financial aspects of the Budget. I commence by suggesting that already at this stage of the debate the Minister would doubtless like to explain, as the Duchess did to Alice in Wonderland, “Don’t bother me with sums; I never could abide figures”. I make that suggestion because budget-making can hardly be claimed this Minister’s long suit. Much has already been said about his faulty budget forecast for 1960-1. There is a disturbing feature about a budget forecast made on 8 March, which by the end of that month was R4,000,000 out. That is a 17 per cent error in almost as many days. Not only did the year’s working therefore bring to the Minister what was ostensibly a windfall, but it also provided the Administration with the “biggest ever surplus” in past years. From a purely accounting point of view there is naturally a pleasant feature about a surplus of that high order for seemingly it gives the Minister an opportunity to allocate larger sums to his lean statutory reserve funds, but in fact only one of those lean funds, the Rates Equalization Fund, is to benefit from the windfall. But windfall or not, from the public point of view the “biggest surplus ever” is not an achievement that really warrants great credit. For the effect thereof is to leave false hopes scattered around —false hopes scattered around amongst the railwaymen and certainly amongst the railway staff associations—and of course the travelling public too must realize that no benefits are going to accrue to them from the windfall. I also call them false hopes, Sir, for the only sure result that this big surplus brings is that it will bring into operation Parkinson’s Law. Parkinson’s second law, as the hon. the Minister may know, never fails to operate in his Department. The Law is simple in terms and it goes as follows: “Expenditure always rises to meet income.” Let us look at how Parkinson’s Law has been operating in this Minister’s Department. In 1959-60 when earnings reached a new height of R401,000,000, expenditure promptly rose the next year to R402,000.000; in 1960-1 when earnings rose to R427,000,000, expenditure the next year again promptly rose to R429,000,000; and this year, 1961-2, when, earnings are likely to rise to R440,000,000, again we find the Administration planning expenditure for the ensuing year which is to rise far higher than that figure. It is quite obvious that Parkinson’s Law is much stronger than the powers of control and persuasion which the hon. the Minister has. It is rather noticeable that in planning the expenditure for 1962-3 originally, two very important items were left out of account. Provision for meeting the outstanding claims of the staff just got into the tail-end of the Minister’s Budget; it was clearly an afterthought; it very nearly missed the bus and it seemingly only got into the Budget under pressure. Provision to restore solvency to the Betterment Fund missed out completely, but some benefit is to accrue to this Fund from the surplus which has just been announced. It is also noticeable in that regard that the pay increase for Railway Commissioners is to be back-dated to April 1961, but pay adjustment for railwaymen is to date from April 1962. In other words, there seemed to be two standards of justice in that regard: Back-pay increases for Railway Commissioners but no back-pay adjustment for railway-workers in spite of the anticipated surplus of R8,600,000 for the current year. So far as that surplus is concerned, it is rather interesting to see from page 11 of the Minister’s Green Book that in the column described as “original estimate 1961-2” a surplus of R11,500,000 was expected. I appreciate that the figure is misleading because it does not take into account the changes introduced by the first additional estimates and by the second additional estimates. I fail entirely to see why out-dated information of this nature should be included in the Green Book at this late stage in the business cycle of parliamentary appropriation. But I merely quote that figure because I have a feeling that it is possibly going to be nearer the mark than the Minister’s R8,600,000. That seems to me to be the better guess. You see, Sir, by the end of November 1961 the published surplus was R7,800,000 and the revised figure which I am referring to on page 11 of this Green Book is based on actual revenue and expenditure to 31 December 1961. That means that the Minister expects a cash improvement over the last four months of the financial year of only R800,000 against a cash surplus of R7,800,000 for the first eight months. Sir, I think the circumstances call for a better explanation than the hon. the Minister gave to this House in his Budget speech. There is something disingenuous about figures of this kind, and seemingly history is going to repeat itself at the end of this month. Sir, I have good reason to believe that the Minister already has in his coffers more than half this additional cash improvement of R800,000. As I say, history is therefore to repeat itself, and if that is so I ask the Minister to tell us why the claims of the staff could not have been met from April 1961 instead of from April 1962. I say that these figures are significant.
I turn then to what I regard as the Minister’s financial blindspot, namely capital expenditure, Listening to the Minister and reading his White Paper, one would come to the conclusion that capital expenditure has no part in the Administration’s financial scheme at all. There was some passing reference to certain capital projects but otherwise the Minister simply treats capital expenditure with disdain. Last year I drew attention to instances where the Minister’s financial forecasts bore evidence of having been superficially made and of being disingenuous, and I said then that the financial announcements of this Minister concealed more than they revealed. This disturbing factor about the railway financial administration on capital account seems to be getting progressively worse, and I will show the House why. For 1960-1 Parliament was required to vote R132,000,000 on loan account for capital expenditure by the Railway Administration, but only slightly more than half of that amount could be put to use. More than R60,000,000 was surrendered to the Treasury at the end of the year. And to make matters worse there was a cash withdrawal of more than R10,000,000 during the year which could never be put to use at all. Where the hon. member for Bethlehem (Mr. Knobel) was wrong is that interest accrued on this R10,000,000. That was wasteful expenditure since at the end of the year the R10,000,000 plus interest had to be paid back to the Treasury. That I should say was certainly a bad bit of financial administration for which I think the Minister and his Board must accept responsibility. But it all stems, of course, from the fact that the Minister’s budgetary forecasts are completely unreliable. There was clearly no need to ask Parliament for R132,000,000 since no more than R72,000,000 could be put to use, and here let me remark that the Minister was only 45 per cent out. Now, the House must not be misled. This is not a case of saving money as some of the public announcements seem to suggest. This is a case either of not being able to carry out or of neglect to carry out essential capital works, or else it is a case of providing on the Estimates for non-essential work. I think the Minister should tell us which it is, but in either event it provides clear evidence of superficial planning. It seems to be a sort of hit-or-miss business involving R60,000,000, which was sorely needed by other sections of the economy and which could have been put to good use but for the dog-in-the-manger attitude of the Minister and his advisers. The House is aware that it is the task of the Treasury to raise each year the capital loan funds that are needed for the whole of the public sector of the economy; that is for all departments, including the Railway Administration. We know that it is not an easy task; it is a difficult task made even more difficult since the Sharpeville incident in March 1960. Hence the warning of the Minister of Finance that loan funds must be used with great care and to the best advantage. Regardless of all this, however, this Minister allows a situation to develop in which R60,000,000 is tied up for a full year and then is not put to use as planned by his Department. Surely that is evidence of a serious dereliction of duty somewhere along the line. Surely it is evidence of a dereliction of duty that borders on financial irresponsibility. If the Minister can satisfy us that it is not a dereliction of duty, then all I can say alternatively is that somewhere along this line there must be a duffer, an absolute duffer. In that respect I would ask the hon. the Minister either to make a confession or to make a disclosure. I invite him to do so.
Coming then to the current year’s figures, 1961-2, although the final outcome of the previous year had been that the Administration could use no more than R72,000,000 the Minister nonetheless asks Parliament to vote on Loan Account R87,650,000 in all. That figure is made up of R85,000,000 on the Main Estimates and R2,650,000 on the First Additional Estimates. Now it is significant, but not unexpected, that sight has been completely lost of that additional R2,650,000, and the indications are that the hon. the Minister once more has demanded from Treasury and from Parliament far more than the Administration can put to practical use. Therefore some R30,000,000 or more are likely to be surrendered to the Treasury at the end of this month. Therefore I repeat my question and I ask: Who is bluffing who? Is the Minister the one who is being bluffed or is he the bluffer? Is the Minister the one who is being duffed or is he the duffer? There is a duty on the Minister to explain this situation for, Sir, in these circumstances no one can have confidence in or be enthusiastic about Railway Estimates. The Minister should therefore take the House and the public into his confidence and explain why his budgetary forecasts have been so wrong—so outrageously wrong—for two years running. If, however, his budget arrangements were not just a superficial bit of guesswork, then I think the hon. the Minister should explain why there has been this chopping and changing in the Administration’s capital and betterment programme for two years running. I pose this question: Can it be that the hon. the Minister has been over-ambitious about his own planning for the future and has overlooked the wider general plans of the Government as a whole? Admittedly he made some passing reference to the expansion plans for Iscor and Escom and Sasol in his Budget speech, but they were only passing references. Or can it be that the previously formulated plans for capital works are to be shelved now for the time being because the Railways are soon to be used as the main bait to foster border industrial development? Whatever the answer to those questions may be (and I hope the hon. the Minister will answer them) it is quite obvious that a fresh approach to railway problems and railway planning is badly needed. In saying that, one cannot overlook the fact that the railway link between Swaziland and the ocean ways has been lost to South Africa, and I feel that it has been lost because the Railways in the hands of this Government are as much a political machine as a transport system.
I leave that there because I want to come to the point that the transport system has become an anachronism in many ways. There is the anachronism which I mentioned in respect of the figures published in the Green Book. Sir, the hon. the Minister has announced the setting up of a new railway rating commission of inquiry. I welcome that, but what is needed most to-day is a full-scale inquiry into railway financial administration and into what the impact of the Government’s new territorial apartheid plans is likely to be on the transportation system. To inquire into the rating system without at the same time inquiring into the capital structure of the Railways is a waste of time and effort. Those two matters are interrelated and they are both outmoded. The capital structure is an anachronism, because it includes a considerable amount of ungainful capital assets and outmoded assets. Instead of easing debt commitments by adopting a suitable capital redemption sheme, the Administration goes on adding to its interest commitments year by year, and it does so apparently with complete unconcern. Sir, the Administration’s interest commitments increased from R14,000,000 in March 1948 to R60,000,000 in March 1961. That is nearly a fivefold increase. But this Minister also chooses to have a completely blind spot in that regard. He prefers playing politics rather than facing good debt management. But he may well be shaken out of his realism and even of his dreams now when he finds himself having to justify further increases in tariffs soon as an inevitable consequence of his present financial administration. I shall enlarge on that a little later on. But so far as railway rating is concerned, the Board of Trade as far back as 1945 pleaded for the adoption of a “cost of service” principle in the place of this happy-go-lucky cathphrase formula “charging what the traffic will bear”. I call it a catchword formula because it can hardly be called a principle having regard to the figures which the hon. the Minister gave me in reply to a question on 16 February last. I asked the hon. gentleman—(a) What amount of revenue was collected last year for the conveyance of petrol by rail, and (b) what haulage and other costs the Administration incurred in giving that service. The answer shows that over and above the cost of service, the Administration extracts a cool R12,000,000 a year from the pockets of the users of petrol. That R12,000,000 a year is therefore nothing else but a form of monopoly taxation, and the incidence of that taxation is to add to the cost of road haulage as well. Although the Minister of Finance is debarred by law from imposing this sort of tax on the petrol user, the Minister of Transport gets away with it by this convenient formula “to charge what the traffic will bear”. But it remains a tax, and whatever else that arbitrary means of raising tax profit from the railway user can be called, it is certainly a far move from the injunction which is imposed on the Administration by law “to promote by means of cheap transport the settlement of agricultural and industrial populations in the inland portions of the country I underline those words “cheap transport”, for having regard to the item I have just quoted, that concept of cheap transport has also become an anachronism.
That brings me then to my next point, the likely impact of the Government’s new territorial apartheid plans on the Railways. Sir, territorial apartheid certainly had no part in the scheme of things when the South Africa Act was passed and when the South Africa Act provided—
All this is obviously going to go. It must go in order to implement the Government’s apartheid ideologies. The Government is no longer concerned with the settlement of an industrial population; it is now concerned with the uprooting of an industrial population and of their separation for purely ideological reasons. Sir, this House has heard much about the political implications of this new phase of apartheid. We have heard it from the hon. the Prime Minister, we have heard it from the Minister of Finance, we have heard it from the Minister of Bantu Administration and Development, and I say that it is now time that we heard about the financial implications from this Minister so far as the Railways are concerned. I have already asked what the implications are going to be in respect of capital expenditure, but I would also ask the Minister to be quite explicit about what the revenue-earning implications of this policy are likely to be in respect of both running and capital accounts. To make my point clear, in this regard I quote certain figures from the General Manager’s latest annual report. The revenue derived from firstand second-class passenger fares on railways rose from R15,900,00 in March 1948 to R16,800,00 in March 1961. That represents an increase in earnings of less than R1,000,000 over 13 years, it represents only R800,000. On the other hand revenue derived from third-class passenger fares on railways rose in that same period from R10,800,000 to R23,200,00. That represents an increase in earnings of R12,400,000. The effect of that may be summarized as follows: Considerably less than half the revenue from passenger fares in 1947-8 came from third-class passengers; the ratio then was 10.8: 26.7. In 1960-1, considerably more than half of the revenue came from that same source; the ratio now having risen to 23.2 : 39.9. The figures I have quoted do not take, into account the R2,000,000 contributed for this very service from the Consolidated Revenue Fund. If that R2,000,000 is added, the ratio changes as well. Therefore when the Minister replies to the other questions in regard to capital expenditure, I hope he will also tell this House how he proposes to balance this side of railway accounts when Bantu resettlement has been fully effected. The Minister may find some comfort for himself, as he did in his Budget speech, by saying that there are no signs that the numbers of non-White passengers are declining. But will he tell this House where the 2,000,000 third-class passengers a year are to come from, and where they are to go to, when territorial aprtheid is implemented?
I leave that there and turn to another serious problem and that is the Administration’s inability to make capital investment productive and its inability therefore to counter a diminishing return on capital investment. I will show that the position in that regard has deteriorated in the past four years, that is since the last general tariff increases took place in 1957-8. For the sake of convenience I am now going to quote pounds instead of rands. In the four years April 1957 to March 1961 railway investment increased by £246,000,000. In other words, the State has pouring into this undertaking something over £60,000,000 a year during those four years. In 1957 when the capital outlay stood at £523,000,000, the ratio of gross earnings to capital was 32.5 per cent; by 1959, it had dropped to 27.7 per cent and by 1961, when capital outlay stood at £779,000,000 it had dropped still further to 27.3 per cent. It is perfectly obvious that without an increase in tariffs it will drop still further in the coming year. Therefore the Administration is now back to the stage of getting diminishing returns on capital investment, and therefore I say that while I welcome the appointment of a new rating commission it is to me quite obvious why this new rating commission has now been appointed.
Mr. Speaker, the figures I have given thus far are based on overall figures for the Administration as a whole. Taking purely railway figures, which exclude Airways and Harbours, the result in that case is even more revealing. I again quote from the General Manager’s latest report. Sir, railway earnings per R100 capital investment dropped from R9.48 in 1959-60 to R6.5 in 1960-1. That I say represents an even more startling drop in the ratio of earnings to capital investment. So I repeat that whilst I welcome the appointment of this rating commission, it is quite obvious why it has now to be appointed.
I have referred to the Minister’s lean reserve accounts, I have not got time to deal with the matter fully. The complications which this Minister introduced into the Betterment Fund in 1959-60 when he chose to bolster it up by a temporary loan of R10,000,000, has now been made worse confounded. To get some sort of clarity in regard to this fund, one has to distinguish to-day between a bookkeeping balance and an actual balance. I am not going into too much detail, but leaving out account for the moment this temporary loan of R10,000,000, the actual deficit at the beginning of 1960-1, was R2,600,000 and the year ended with a deficit of R6,200,000. If you bring into account the temporary loan of R10,000,000, then the balance on 31 March 1961, the cash balance, was R3,700,000. That bookkeeping balance seems to have been the Minister’s undoing. For some inexplicable reason, the Administration then decided to transfer by appropriation in last year’s Finance Act the sum of R4,000,000 from this fund to Head No. 2 to finance capital expenditure on new works on open lines. This questionable manoeuvre wiped out the entire cash provision in this fund, it obliged the chief accountant to raid some other funds to make up the full amount of R4,000,000 and it increased the actual deficit at the end of 1961 to R10,200,000. Sir, even Alice in Wonderland could not have seen confusion made worse confounded. To raid a fund that has money it it may be unwise, may even be criminal, but it can be profitable, but to raid a fund that is in deficit, is to my mind just the heigh tof irresponsibility. Therefore I say it surely can only be the work of a duffer, an absolute duffer, and I think the hon. the Minister should tell us more about it. It is evident that the Controller and Auditor-General himself has been mystified by this transaction and he has had to use all his ingenuity to try and unravel the muddle in which the account has now been landed. I can only say that the Minister’s capital and betterment estimates being as unreliable as they are, it is quite impossible to unravel the muddle the fund has got into, I leave it therefore to someone else to unravel with the figures before him. But it is quite obvious that all that has happened is, as far as this fund is concerned, that at the end of March 1962, the advance from the Treasury will have been reduced from R10,000,000 to R6,000,000, and the fund will still be considerably in deficit, possibly to the extent of R6,000,000 or more. Therefore the R8,000,000 which the Minister proposes to contribute to this from the current surplus is a sorely needed contribution, but it cannot last, because obviously next year’s expenditure from this fund is going to be substantial. Now this muddling, Sir, has found its way into the working capital account as well and it has resulted in more money lying idle in the Working Capital Account than good management or even expedience requires. The Minister or his advisers, if they had seen to it that the brief put before them in the Treasury White Paper which accompanied last year’s Finance Bill had been adhered to, would have avoided all this muddle that has arisen. The result of it all is that some R7,000,000 of capital is now lying idle in the Working Capital Account, on which accrued interest is payable.
Sir, I would like to make very brief reference to the Higher Replacement Cost Account which is also in a very unsatisfactory state. It is obviously on its way out, it is about to be abolished, and the deficit is going to be absorbed into the General Renewals Fund. Sir, it was started in order to bring greater stability to the finances, but within the first three years of its existence, the Administration allowed it to become bankrupt. The failure was the Administration’s disrespect for financial principles, and not because the accounting arrangement was wrongly devised. Therefore the account should not be abolished without the proposal first having gone to the Select Committee on Railways and Harbours to examine the position and to deal with the matter in detail. You see, Sir, the red warning light of poor financial administration which that account provided in the past, if it is removed, is not going to remove the danger which is implicit in the failure to stick to principles and to make adequate provision for replacements at a higher cost. Therefore I think it is a serious matter that the Minister has chosen to ignore the long-standing practice of this House that no important change of this kind should be made by the Executive without the prior approval of the Standing Committee of this House, that committee of course acting on behalf of the House of Assembly.
Sir, I put various questions to the hon. the Minister. He might wish to disregard some, for reasons of his own, but I certainly hope that he will not do so. There are certain questions that I have raised which he should answer and I certainly hope he will do so.
Whilst listening to the previous speaker, a few matters struck us. Firstly, that even a person with a thorough knowledge of finance had to admit that this Government and this Minister and his Department have earned great merit just recently with their thorough planning. And now he goes further and raises certain doubts in regard to the budget. He voiced the criticism here that year after year there has been faulty budgeting as the hon. member for Wynberg (Mr. Russell) also said. So he pointed out this afternoon that superfluous funds were voted for capital expenditure, funds which now lie there idle and which could have been used by the country in other respects. But even that hon. member with his knowledge of these matters should know better than anyone else that the Railways is a tremendously complex organization and that, with the best will in the world, things do not always proceed according to plan. Many factors may intervene to disrupt one’s planning, and to delay it. Then he painted a sombre picture in regard to the future. He asks what will happen if the Bantu homelands are developed? What will happen if border industries are established and we no longer have the revenue from the passenger traffic, particularly of the non-Whites, as is the case now? All these things will be planned by a planning commission in the future, just as they were planned in the past and of which we are to-day plucking the fruits.
I do not want to go further into what the hon. member said, but I just want to emphasize that if he listens to what we say here, he will have to admit that the productivity of the railways was increased tremendously, particularly as the result of thorough planning. Three years ago the position of the railways was described by the hon. member for Wynberg in this House as being practically chaotic, and he ascribed it to inefficient management and control. That is what he accused the Minister of when he was looking for the causes, and he said it was due to the incapacity of the Minister. His colleague, the then hon. member for Salt River (Mr. Lawrence), expanded on it and said that it was due to “blundering Ben The prediction of the hon. member for Wynberg was that we were facing a catastrophe and that only a miracle could save us. Our defence at that time was that no great miracle was required, but that we relied on thorough planning. Even the Viljoen Commission pointed out that planning brings one to a certain stage where the tree must inevitably start bearing fruit, and we said at that time that we were then on the point of plucking the fruit, and that next year the country would pick the fruit of this planning. At that stage the fruit was not yet ripe enough to be plucked. Everything was just on the point of going into production in regard to many important aspects of this great undertaking. And our words were proved to be true. The hon. member for Wynberg and others at that time sneered at the explanation we gave, but it was proved to be true. The efficiency of the railways was increased and losses were changed into surpluses. But what reaction would one have expected of people with the necessary chivalry? One would have expected them to say, “Yes, you were right, we must congratulate you on that achievement; we could not see it in that way.” But what do we get from them? They only evade the matter. They do not go into the merits of the case. And that can be ascribed to two possible causes, viz. political jealousy on their side, or it can be due (and I am rather inclined to believe this, because as I know the hon. member for Wynberg I must believe it) to a lack of magnanimity on their side. The hon. member for Wynberg has never yet in this House struck us as a magnanimous person. When he was on the point of joining the Progressive Party he lost his courage and came back to sit with the United Party again. He has never been a brave hero in their ranks, and I say it is that lack of magnanimity which results in their refusing to admit what a high level of efficiency has been achieved by the railways, a level they had never achieved previously. Those hon. members do not try at all to ascertain whether the railways is efficient or not, but if matters had developed in the way they wished, the hon. member for Wynberg would have come here and he would have analysed it bit by bit and he would have held it up to the public outside, because it is his strong point to hurt South Africa in the eyes of the world whenever he gets the opportunity, and he deplores it when things are going well with us, as is the case now again. That is nothing else but proof of a lack of magnanimity and chivalry on the part of the hon. member for Wynberg, that he refuses to admit that the Minister and the Administration and the railwaymen have made a success of this great undertaking, whereas the hon. member predicted that they would suffer disaster.
I want to go further. Instead of going into matters thoroughly, the Opposition moves an amendment here which they want to use as a peg on which to hang their hat. There is nothing in their amendment which can be supported by the facts. The amendment asks in the first place that the demands of the railwaymen should be complied with in order to raise their standard of living by increasing basic wages, benefits and pensions. Have they proved to us that the standard of living of the railwayman is so low? The railwayman need not pull his hat over his eyes for the hon. member for Wynberg or the hon. member for Turffontein or anyone else in regard to his standard of living. If they know those people and get into touch with them, if they see what the way of life of those people is they will have to admit that their standard of living leaves nothing to be desired. Hon. members opposite did not take the trouble to get up and admit that from time to time the Minister made provision for higher basic wages. What about 1958, when the non-pensionable allowance which varied from R6 to R14, was included? That cost us R13,000,000. Why did they not refer to that consolidation of allowances with salaries which took place last year? Is that not an increase in the income of these people and of their future pensions? These are all things which contribute to a better standard of living, but hon. members did not think about that; they did not try to controvert that and they brought to light no facts to explain the first point in their amendment.
For the rest, they discussed the financial administration and management of the Railways, Harbours and Airways, and they say that it should be put on a strictly business basis as opposed to a political one. Mr. Speaker, the only reason they did so was merely to have the opportunity to sling mud at persons and to express their disappointment at the fact that the National Party tried to do the same things they did, or followed the same course they did. But we did not do quite that, because they appointed people to the Railway Board who had no merit, people who were appointed to those high posts merely for United Party reasons. We appointed people with merit. They say, further, that there are defects in the financial administration, but we alleged and proved the contrary. Do not the operational results prove that there were through planning and organization? Did not the hon. member for Wynberg admit that there was an eminent economist on the Railway Board? But nevertheless they ask that there should be better organization and administration. We will prove to you, Sir, that much was done to improve the administration and control and everything else and to make it as effective as possible.
Then they come to the third point of their amendment in which they ask for the appointment of a commission of inquiry to investigate methods to improve the existing machinery for negotiation with the staff. That matter they left severely alone during the debate. Which one of them got up to mention the present machinery for negotiation; which one of them pointed to the defects, and what suggestions did they make to improve it?
Where were you during the debate?
The hon. member should listen. If he opens his mouth so wide, his ears cannot take in anything. If he listens to what is said here, he will understand better. If we look at the channels these people have for voicing their grievances, I want to remind hon. members of the Opposition in the first place that when they talk about the Railway personnel they should not think only of the 17,000 artisans, but of the 113,000 White railwaymen who must be cared for. I now ask what channels exist? Apart from the channels by which a person can bring his personal grievances to the notice of the System Manager, the General Manager and eventually the Minister, there are still the staff associations. There are seven staff associations: For the salaried staff, for the locomotive staff, for the train staff, for the graded personnel, for the artisan staff, the miscellaneous employees, viz. checkers, etc., and then for the rail workers, for the motor vehicle drivers and the police. But if a person does not receive satisfaction from those staff associations, and there is one-fifth of the members of the staff association who support his claim that he was not treated fairly, and he can get them to support his protest that justice was not done to him, the matter goes to the Conciliation Board. There is the Federal Consultative Council, on which all the staff associations are represented. There are representatives of the staff on departmental boards and committees. There is the Conciliation Board to which I have referred and there is the procedure laid down which results in the fact that if a large section of the staff is dissatisfied even with a decision by the Administration, the road is open to them to proceed along the correct channels right up to the President of the Republic, who will then appoint an impartial commission to hear their complaints. Sir, are there not enough channels provided for people to air their grievances? There is not a single railwayman who can say to-day that he has no channels along which his case can be stated and justice done to him.
But, Mr. Speaker, I go further and I want to point to the efficiency of the Railways. Many figures have already been quoted, but just let me mention a few to prove that the working results of the Railways clearly indicate the progress that has been achieved and which was based on efficiency. There is, e.g., the tonnage of revenue-earning traffic which was increased by 7.6 per cent this year, as compared with last year. The load ton miles increased by 8.46 per cent. There was an increase of 14,707,364 in the number of passengers carried as compared with the previous year. In addition we have the surplus reflected in the books, all of which points to better working results, which indicates higher productivity. In order to increase productivity it means that one must produce more at a lower cost. And how is that done? In any production unit it is done in the first place by modernizing the methods of production and making them more efficient. That is exactly what sound planning did for the Railways. In 1958-61 over 11,000 more trucks were provided. Therefore the Minister was able to say that within the near future we will be able to transport all the traffic offering. The tractive power of the locomotives was not only increased but strengthened. There are 359 more locomotives than there were in 1958, that period which was so dark for us. There were improvements to the tracks, like steep gradients and curves which were eliminated. There is electrification, long-distance control and central control. In the constituency I represent we have clear proof of what can be done through central control. The people there say that they are now able to bring a train from Koopmansfontein to Kimberley more than an hour sooner than before, and all that proves that there has been more efficient control, which is the first prerequisite for higher production, viz. an improvement in the methods of production. But further, the control and organization were improved, and that is the second prerequisite for all scientific management. The annual report of the Controller and Auditor-General for this year mentions it in paragraph 14, where he says—
The various methods designed to improve control over Railway finances which, as stated in paragraph 14, page 21 of the previous report, have been introduced progressively by the Administration since June 1959, were further extended and improved during the year under review. The steps taken include the following:
The expediting of Stores accounting work to obviate the late rendition of Stores Debit Notes;
The improvement of the method of accounting for the expenditure on the purchase and consumption of locomotive coal;
The centralization of control over stores and materials.
So it goes on and we are given a long list. Bur further I can point out that the percentage of labour costs given in terms of Railway revenue over five years brings to life the following. In 1956-7 it was 55.6 per cent; in 1957-8 it was 52 per cent; in 1958-9 it was 52.87 per cent; in 1959-60 it was 49.14 per cent, and in 1960-1 it was 47.20 per cent. It is therefore proved that through the employment of fewer people more effective work was done, which is one of the prerequisites for increased production. If labour productivity is expressed in terms of passenger journeys, or in terms of goods ton miles, it appears that the productivity of the White staff was increased by 15.9 per cent during these ten years. Through better facilities and more efficient work the average worker did 15.9 per cent more work than ten years ago. But now we should remember, Sir, that the co-operation of the workers has to be obtained for these matters. In the first instance that co-operation must be obtained by means of work studies. And is it not one of the splendid projects tackled by the Railways that in the past few years they concentrated on the scientific approach, and instituted work studies to an increasing degree? Furthermore, there was the correct placing, to an increasing degree, of workers according to their ability and interest. We are gratified by that. Sir, if one takes a man with a particular aptitude and interest he will work almost unceasingly in that direction; he will find self-expression in that work, and the great value of vocational guidance and education lies in selecting people for the work for which they are suited and in which they are interested. To an increasing extent the Railways, when employing workers, try to ascertain in what definite direction a person wants to go, so that a man with a mechanical flair will not be placed in the clerical division, but that every man will be placed in the type of work for which he is suited by his aptitude and interest.
One further gets the co-operation of those people by treating them as human beings, by paying them better salaries, as we have already indicated, by providing them with better housing, which has continually been referred to in this debate, and by affording better conditions of work. Let me remind the House that the Ford Commission in 1956 issued a report containing 4,122 recommendations which had to be implemented to improve conditions of work, and in 1961 already 92 per cent of those recommendations had been implemented. May I remind hon. members that to an increasing extent training facilities have been provided by means of bursaries and other opportunities for study, by which thousands of railwaymen have been trained, also in our Railway College, to work more efficiently. If we remember all of this, it cannot be otherwise; then the result must eventually be success and higher productivity. And that is what happened in fact.
The result is that there is a great increase in the number of people who again want to enter the Railway Service. There are more people who are keen to rejoin the service than there are people leaving it. If we take the figure of how many people left the service in 1958, it shows a turnover of labour on the Railways of approximately 11.5 per cent … [Interjections.] Let the hon. member for Turffontein tell me now what the labour turnover is in other activities. I was referring to the White workers, and that is the percentage. Let the hon. member give me the comparative figures for industry in order to try to prove that the Railways are in a worse position. The people who apply for re-employment on the Railways far exceed the number of people who resign. Therefore we can say with certainty that the railwayman wants to return to the service. It is a fact that if we continue in this way all these tendencies show an upward curve, and if nothing unforeseen happens, unless a catastrophe occurs which nobody can possibly foretell, then the whole tendency of development to-day is such that we can state with certainty that nothing else awaits the Railways than a period of greater efficiency, higher productivity and a splendid future.
Mr. Speaker, various hon. members have referred in this debate to the Railway officials. I also want to refer to the Railway official, and in particular I want to express a few thoughts in regard to the lowly paid railwayman. The lowly paid man falls within the wage structure in his particular occupation, on a wage scale which is influenced by various factors such as productivity, skill and responsibility. An increase in wages will perhaps be the popular and the easiest solution for such a problem, but irresponsible action in this regard, without due regard to the multiplicity of factors accompanying it, may in the long run not only harm that occupation, but it may also severely harm the economy of the country, and in the final result the very person whom one sought to benefit may perhaps be the one most severely affected.
The lowly paid man in any occupation bears a particular responsibility, like all of us, because apart from his work and the task entrusted to him by his employer, there is the responsibility particularly of the married man with a large family to provide his family with the necessities of life. Protests have often been voiced against the diminishing number of children in our homes. But in our complex society it seems that this small number of children has now become the general rule. But, Mr. Speaker, taking into consideration our small White population and our available manpower, I think we are allowing a wrong and dangerous conception to dominate us. But fortunately I can say that we still find several children in certain homes and often also in the home of the lowly paid man, or of the person with a limited buying capacity; and also in the home of the railwayman. And this is particularly where the burden is heaviest, the burden not only of feeding and clothing a family, but also of ensuring that the maximum schooling is provided. If he cannot give it to them, then in the next generation some of them may find themselves in a position which could perhaps have been prevented.
Mr. Speaker, we must make mention here with joy and gratitude of what the Railway Administration has already done for these people. There are the housing schemes and the sick fund and pension benefits, and whereever possible those benefits are being increased. One method by which these people increase their income is by working overtime and on Sundays. Now I am aware of the policy followed in this regard, a policy of economizing, a policy which I wholeheartedly support as long as the efficiency of the undertaking does not suffer. But, Sir, I want to make a serious appeal that this policy should be applied with the greatest care and most judiciously, because a few thousand rand which we spend correctly in this direction assists those for whom we are pleading, and perhaps it assists not only them but the whole country and our whole economy; and if we do not render assistance in that way we must perhaps in any case give financial assistance in other ways.
Another matter of a more local nature I want to mention is the question of steam tractive power. The tendency in the world is for steam traction gradually to be replaced by diesel and electrical traction. That tendency is evident also in South Africa, and one can expect steam traction eventually to be limited to a minimum. Sir, we find the accepted policy of the Railway Administration in the latest annual report of the General Manager. I quote what he says—
In the light of what I have just said, it is very clear that we can never completely manage without steam traction. We can, however, expect it to be reduced in the course of time. We have large steam locomotive workshops in my constituency and if there is a big reduction in steam traction it can very deleteriously affect the activities there. Unfortunately the staff is aware of this tendency and many of them are afraid that, having worked there for years and having vested interests there, they will perhaps be transferred to other centres or to other employment. It is perhaps difficult for the hon. the Minister at this stage to say anything definite in regard to the future of these workshops. I, however, want to ask him that if there is the possibility of this being done he should raise the curtain for us a little and give us some indication of what the future of those steam locomotive workshops will be. That would give much more certainty to the people working there and it will once more give them a feeling of stability and make them feel much happier in the work they do there. We can only say, Sir, that even though it is accompanied with much smoke, we would like Germiston to remain the central locomotive workshop and from that centre we will keep the steam locomotives running.
The further matter I wish to touch on is also a very real problem which will have to receive attention sooner or later. With the removal of the old Germiston location to the Natalspruit area where a large new Bantu residential area was established, a very big job was completed. The Bantu workers are now being transported from their homes in that location to the White area. But now it happens that particularly those who work in the centre of the city use a certain station for leaving the trains. I took the trouble to go and stand at the entrance to that station and I counted the hundreds of Bantu workers who alighted there and then moved through a White residential area. Sir, we know the Bantu. By nature he is a cheerful sort of person, and not only is he cheerful, but even rowdy. And unfortunately, Sir, many of his conceptions of cleanliness and hygiene leave much to be desired. Now the Whites living in that area feel that they are not getting the necessary peace and quiet to which they are entitled. We do not want to be unreasonable, but we feel that the possibility should perhaps be investigated of having a greater distribution of places where the Bantu can alight from these trains. There are also other stations which could conveniently be used by these workers. If that could be done it would prevent a big crowd of them alighting at one station and walking through the White area. Sir, the crux of the matter, in my opinion, lies in this—and I am quite convinced of it—that where we provide for the Bantu their own decent residential area and no other section of the population can be a nuisance to them there, we should grant the same rights to the White people, and where conditions such as these have developed we trust that when we get into contact with the office of the hon. the Minister and the other interested bodies, attempts will be made to relieve this problem for the people there. I believe that a large number of people will be very grateful for it.
I want to conclude by referring to another matter. In the annual report for 1960-1, the latest report of the General Manger of Railways, we read about research being done in various spheres by the Railway Administration. One is impressed by the volume of work being done and the results which are achieved. But if one reads further, Sir, there is, as far as I am concerned, one particular omission, viz. that there is no reference to research in the sphere of aviation medicine. If one reads a little further about the activities of the Railway Health Division, one does not find any reference to this particular matter there either. Mention is made of the fact that the Chief Health Officer of the Railways received special training overseas and that he is a member of two international committees working in that direction, and that through attending the meetings of these bodies he is kept au fait with the latest developments in this respect. There is, however, no reference to any independent research being done by us in this sphere. We have the phenomenon and the experience in South Africa that we no longer appear to be welcome at many international conferences. Now one wonders whether in regard to an important matter like this, particularly as the hon. member for Bethal-Mid-delburg (Mr. J. W. Rall) also stated, in view of the increasing importance of air travel, the time has not arrived for us to do independent research in this regard. I imagine that such research could be done in conjunction with the Department of Defence and certain of our universities closely situated to those facilities. If we do that we will create a field of employment for prospective research workers, but even more important, we will have the satisfaction of making a positive contribution in a sphere which is of particular importance in the world to-day.
It is my privilege to congratulate the hon. member for Germiston (Mr. Cruywagen) on his maiden speech. He has made a constructive speech in which he has revealed an objective approach to the Budget and I am sure that augurs well for his future in this House. It is quite clear that he had studied this matter considerably and if he continues in that objective way I am quite sure that he has a very fine parliamentary career ahead of him.
Judging by most of the speeches made by members on the Government side in the course of this debate one would assume that because there is a surplus in the Budget it is therefore a good Budget. Sir, it is very easy to have a surplus on a Budget when you under-estimate revenue and over-estimate expenditure. The hon. member for Port Elizabeth (South) (Mr. Plewman) showed in detail what has been done in connection with the Budget and I do not propose covering that ground again. The hon. member for Kimberley (South) (Dr. W. L. D. M. Venter) when he spoke just now, criticized the attack made by the hon. member for Port Elizabeth (South) on the question of the bad administration of the Capital Account. His remarks only confirmed how little he knew of capital appropriation. Surely the hon. member should know, and if he did not know he should not criticize, that when the Railways estimate that they are going to have certain capital requirements for the year and they are over R60,000,000 out, that amount has been earmarked by the Treasury for the Railways, and consequently there is less money available for the private sector. The Treasury cannot easily manage the affairs of the country as a whole if when taking into account the amount of public and private funds required it is faced subsequently with estimates which are so inaccurate that they are R60,000,000 out. When funds are allocated, when the Railways apply for funds for capital purposes, and fail to use them, it in turn affects the economy of the country as a whole. The financial policy of the country is controlled indirectly by the Treasury. The Treasury indicates to the Reserve Bank and the financial institutions the amount of money required for the country’s needs for the year and that is taken into account when allocating funds. Here we have the Railways applying for substantial capital amounts and not using them. That indicates that those responsible are only concerned with getting as much money as possible and they do not take sufficient care. It is not necessarily the fault of those concerned with the financial side of the Railways; quite often it is the fault of those on the engineering side. Engineers always like to ask for big sums to enable them to get through the work. I suggest that the Minister should inquire into that matter to ascertain which Department is responsible, because by these senior officials asking for money far in excess of their requirements they prejudice the interests of the country as a whole. The Railways’ Budget must not be examined in isolation. The Railways contribute in their way to the national economy. The Minister in his Budget speech indicated that certain traffic, particularly suburban traffic, had increased. Earlier this Session we had indications that the Government was going to establish border industries. In the past when we raised the question of suburban traffic, the Minister has always said they will not introduce the services until the traffic justifies the service. What is his argument going to be this year when dealing with border industries? Is he going to wait until the border industry is established before providing the transport, or will he provide the transport so that we can get border industry? If there is to be a change in policy we should know about it now because it has been the policy for many years to establish townships on the outskirts of our towns. I refer particularly to Cape Town and Durban. In Cape Town there was a delay in the housing and the railway was there long before the housing. That showed lack of co-ordination. In Durban the position is quite different. A large town ship has been established at Kwa Mashu, the houses are there and hundreds of thousands of pounds have been poured into buses and roads in order to provide the transport for the workers living there, and the proposed railway will take some time before it is completed. Here you have the difficulty that there is a lack of co-ordination and there is tremendous capital expenditure, not by the Railways but by private interests, on road transport services which in the ordinary way should have been provided by the Railways. It is unfortunate that the Railways did not provide a service to Kwa Mashu two or three years ago, because had they done so they would have considerably reduced the time taken by the Africans to go to work. One of the biggest difficulties when the Government decides on a policy of isolating the African people from the factories and provides that they must live a considerable distance from the industries means that they take a long time in travelling. Recently there was a reference in the Press to an application by certain transport interests for road transport in Durban and the applicants indicated that they wanted to have through transport running because the investigation showed that most of the non-Whites south of Durban were taking 2½ to 3 hours to get to work and the same time to return. Here you have workers in factories taking almost 3 hours to get to work, working eight to ten hours and then taking another 3 hours to go home. That lowers efficiency, and this could have been avoided had there been better co-ordination on the part of the Railways, and had the Railways provided the service at the same time the houses were being built. The Minister has indicated that non-White transport is increasing. In the past we have endevoured to get from him an indication as to the cost of non-White transport, to see whether it pays. The Minister has indicated in the past that it is not easy to calculate the cost, but if we are going to have non-White transport and it is going to be done efficiently I submit the most efficient way of doing it is by an electric train service. Yet if you examine the General Manager’s Report you see that the number of passenger journeys in the third class at Cape Town is 27,850,000. For Johannesburg it is 115,800,000, and for Natal is is only 9,250,000 train journeys. If you examine the most recent report of the Department of Census and Statistics you find that the population of Cape Town is about the same as that of Durban, yet Cape Town has three times as many passenger train journeys as Durban. That suggests that there has been a neglect by the Railways in providing non-White transport services in Durban, and the Minister is losing traffic and revenue in the Durban area. If you compare the figures I suggest that the Minister is losing 18,000,000 train journeys a year through not providing the service. The effect of that is to push an increasing volume of non-White traffic on to the road services.
But you know perfectly well that the provision of services to Kwa Mashu is on the schedule.
I know it is on the schedule, but my point is that there is lack of co-ordination.
You must blame your municipality for that.
The Minister blames the municipality. When it suits the Government they get municipalities to comply, so far the Government has not failed to do so. In this case it is quite obvious that the municipality has been far ahead of schedule in its housing and the Minister has been lagging behind. The Minister should be blamed for his tardiness in providing the service, instead of blaming the municipality. The houses are complete and ready. Do not blame the municipality for being in a hurry. The result is that many thousands of people are being carried by road and taking longer to get to and from work. They have to go to the centre of town and have to change buses to get to the southern part of the town, and that increases the time taken to get to and from work, and that militates against efficiency in industry, and subsequently those buses will have to be taken off the road because as soon as the Minister has scheduled that service and it is running he will insist that having provided the service the road transport licences should be cancelled. The Minister will turn round to the town and say he has been asked to provide the service, and having done so they do not give him the traffic. The hon. member for Umhlatuzana (Mr. Eaton) reminds me that the Minister has not started providing for Umlazi yet. Will he get that on schedule? Will he wait for all those houses to be finished first?
Do you want me to build a railway line there? It has not even been decided to build one there yet.
The Minister should tell us whether he regards a railway line as the most efficient method of moving suburban passengers. Surely you will agree that a fast electric service is the most efficient way of doing it. Surely if he knows that he should make up his mind now and not wait until the houses are finished and people have spent thousands of pounds on buses, and wait until the roads become cluttered up with buses and then decide to build a railway line. Surely the Minister’s interjection is an admission that he has failed to look far enough ahead.
The Inter-Departmental Committee recommended that no railway line should be built there.
Does the Minister now tell us that there will be no railway line to Umlazi?
It all depends on the circumstances.
If that is the way the Minister has planned in this matter, there is no hope for the Railways. Yet the same Minister is dealing with the question of border industries. Will he wait until these industries are established before providing the service, or has he one policy for one province and another policy for another province? The border industries will not be established by any responsible industrialist unless he can be sure of labour, water, power and transport. Surely the Minister should tell us now whether it will be the Government’s policy to establish the transport before the industries are there.
Do you want me to tell you which came first, the egg or the chicken?
Yes, and there are some chickens whose necks I would like to wring. The Minister should know that the country wants to know, and industrialists want to know, what his policy is and this is the time to ask for it. It is all very well for the Government to talk about border industries and decentralization. The industrialists in our big towns to-day recognize that they are not getting the efficiency from their non-White workers, largely due to the time taken in getting to and from work, and they look to the Railways to provide a fast, economical service, and they want to know what the Minister’s plans are. But the Minister tells us he has not made up his mind.
Those services are not economic.
If the Minister says that, let him prove it. Let him put figures before the House to prove it. In the past when we asked for figures he could not give them.
That is why the Treasury guarantees the losses.
Every time the Minister interjects he puts his foot into it. The Minister must put figures up to Treasury to prove that they should subsidize it, so there must be figures. The Minister cannot have it both ways. If he says it is uneconomic it is quite clear that the whole of the Government’s policy of moving non-Whites from the centre of town is uneconomic and must be subsidized by the economy of the country, and therefore our cost structure must go up. It is giving notice to every industrialist that suburban services, being uneconomic, they must be subsidized from the Consolidated Revenue Fund and therefore it increases the cost structure and therefore it gives notice to every industrialist that the cost structure which will result from applying the Government’s policy will endanger our export markets. So we have come to the stage where there is an admission by the Minister that first of all he does not know whether he will render this suburban service. The Government has provided that these townships shall be outside the big towns, which means that a long time is taken by the workers to get to and from work. These services are uneconomic and therefore they have to be subsidized by the Government. That brings us to our main point, when we come to border industries, that they too will have to have railway services provided. In the big towns it is clear that the Minister can give no assurance that they will get the suburban service, and yet the large towns have to provide the road services. Does that mean that the whole burden will fall on the towns and that the Government will take no responsibility? Then the Minister in indicating that he will do nothing to provide services for the south of Durban, will result in the fact that no industrialist will know what to do, particularly when industrialists are being forced to give up their compounds and send all their labour to these townships. There will be further delays and lowering of efficiency. It is for that reason that I pointed out earlier that the Railways form part of the economy of the country as a whole and the Minister of Transport is not only responsible for balancing his Budget or showing a surplus. He also has a responsibility to the country that the Railways as a national service must contribute to the national welfare and therefore it must be run as efficiently as possible and provide all the main transport services, and we have had no satisfactory indication from the Minister so far. Let me examine the Minister’s Budget speech further. We find that reference is made to stocks on hand, and the Minister has indicated that there has been better control in the past year. No figures are given, but the size of the stores account is about R100,000,000. The General Manager’s Report indicates that the turnover in the stores department during the year under review amounted to R257,000,000, as compared with R229,000,000 the previous year. If the Minister can save one month in the life of the stores per annum, he can cut down the stores by R10,000,000 per annum.
That is not stores on hand.
If the Minister can cut down his stores on hand to the extent of one month, the saving in interest alone will amount to R500,000 a year. It is obvious that while we have not received the report of the Moffat Commission, as far as we can gather one of its main recommendations was that there should be better control of the stores. We would like the Minister to give us some further information as to what savings have been effected. In his Budget speech the Minister referred to one item where an economy had been made. I refer to page 14 of his speech, where he referred to the DC-7B aircraft. Here is a matter where I suggest that financial considerations are not always the only consideration. The Minister said that the Skycoach services are not economic, as the DC-7B aircraft now being used were not designed to meet the operating characteristics of domestic service, and operating costs were high in relation to the low fares charged, and an increase in the number of seats from 74 to 96 was being considered. Sir, that speech was made, or certainly written, before the disastrous crash of the DC-7B in Central Africa. I hope the Minister will be very careful indeed before he increases the seating capacity from 74 to 96 on these aircraft. The Minister’s Department has a very high safety record.
We will never do anything to endanger the safety of the public.
The view has been expressed by more than one person interested in aircraft that the safety margin will be endangered by increasing the seats from 74 to 96. While it is our claim to ask the Minister as far as possible to examine the figures carefully to see where savings can be effected, we cannot push this too far when it comes to aircraft.
In dealing with this Budget, which shows a surplus, I feel that the Minister has failed to take into account the economy of the country as a whole. The Minister has dealt with the matter purely as it affects his own Department and he has failed to recognize that he has a responsibility to the country as a whole. Every industrialist is concerned with rail tariffs and the Minister has indicated that he has a tariffs commission. Surely the Minister should also go into the question of costs. As far back as 1945 the Board of Trade issued a report on railway tariffs and said that it must be in the national interest for the Railway Administration so to design its rate policy as to ensure that the volume of traffic carried shall be as large as possible so that with the consequent spread of overhead expenses the average cost of transport for each unit carried will be as low as possible. Dealing with costs it said that an even greater difficulty was the fact that all railway expenses cannot be accurately allocated, and costs which are common to different units of transport must be apportioned to them on a predetermined basis. The Board then said that it appears that these difficulties have been considerably over-emphasized and that an index of allocations, although not perfect, must be infinitely preferable to having no index at all. Sir, I submit that with the advent of electronic devices for making computations in his Department and to provide information as to the operation of the Railways, the Minister should be able to get sufficient information to provide the Tariff Commission with detailed information in regard to costs.
We do that.
Whenever we tackle the Minister he says he does it, but whenever we ask him for details the Minister says they cannot be provided. Last year I asked the Minister for figures on the same matter and he said they were not available because they were too complex.
When did I say that?
Look at Hansard. It is clear that the Minister with his habit of interjecting will not save time in this debate. He will not save time if he does not adequately answer our questions. The Minister has failed to appreciate that he is responsible to the country as a whole and is not just sitting in isolation to balance his Budget in order to assure his few friends that he is an efficient Minister. The test of the Minister’s ability is his ability to plan for the country as a whole, and not just from one year to the next. Any fool can do that, but what is wanted is planning for years ahead and taking into account the over-all development of the country, and if the Minister does that and tells us what plans he has for the future he will convince us more than he did in his Budget speech.
Mr. Speaker, because the transport system of the Republic is the main artery of our economic development, the operational results as reflected in this budget in respect of the three sections of that system, the Railways, the Harbours and the Airways, are very encouraging. I want to say at once that had we had an Opposition that could be called to account and an Opposition in the true sense of the word, namely an Opposition that came forward with constructive criticism, an Opposition that really performed its functions in that respect, and not an Opposition which for small and doubtful party political gain always came forward with destructive criticism, I predict that subject to those conditions, the Republic is on the threshold to-day of the greatest possible potential development that we have ever had in the history of South Africa. I will give my reasons for saying this. I want to remind you, Mr. Speaker, that when we had the Budget debate last year the economy of the country was not as sound as we would have liked it to be. Our reserves showed a downward tendency for various reasons which I do not wish to go into at this stage. One of the reasons was that there was over-importation of certain items which were not so essential to South Africa and on the other hand of certain items which could have been produced locally. Think of such an item as motor cars. We know that at that time the showrooms of many firms in this country were full of motor cars that had been over-imported and which they could not sell. The same applies to other items and that resulted in a decline in our reserves. The Government was obliged to save the situation by introducing import control. Those steps which the Government took inevitably had a detrimental effect on the high rated traffic of the Railways and effected its revenue to a great extent. In addition to that we must also consider the fact that in last year’s budget an amount of R13,200,000 was allocated from the current revenue account of the Railways for the consolidation of the cost of living allowances and for other concessions to the staff, money which must also come from the revenue of the Railways. Over and above that we should also remember that during the year, as has been revealed in this debate, we had an Opposition who was blind to the good features and the sound financial position of the Railways, an Opposition who only tried to condemn and to break down. I maintain that in the circumstances of the day the Minister was obliged to be very careful in the budget which he introduced last year. Safety comes first, particularly as far as financial matters are concerned, otherwise you may come to a rude awakening as far as those financial matters are concerned. Consequently the Minister budgeted for a deficit of plus minus R500,000 last year. However, because of the inherent soundness of the internal economy of the Republic and because of the sound financial policy of this Government over the past 14 years, that inherently sound economic position has been maintained at that high level up to the present, the Minister was able to close his books this year with a surplus of R8,600,000. It is interesting to note that this increase in the revenue during the past year is spread over all three departments of our transport system. There has been a remarkable increase in revenue in all three of these departments. The revenue of the Railways has increased by an amount of R6,800,000 the revenue of the harbours has increased by an amount of approximately R4,000,000 and the revenue of the Airways has increased by an amount of Rl,370,000 a total of R8,700,000. That is an achievement of which we as South Africans should be proud. It is an financial achievement which has not taken us as much by surprise as it has hon. members opposite, because we have always emphasized, year in and year out, in spite of their predictions, that the economy of the Republic of South Africa was inherently so sound and so buoyant that no matter what the circumstances were, it would reveal itself as a growing economy, and this revelation as a growing economy has, as a matter of fact, greatly assisted in saving the Railways and helped it to show this surplus this year. That was why I said that when we consider the revenue and the operational results of the Railways during the past financial year and we think of the circumstances in which the Republic of South Africa found itself and we think of the fact that in spite of those circumstances the Railways have been able to show the surplus which it shows in this budget, I think I am fully entitled to say that South Africa is on the threshold of probably the greatest development in the economic sphere of its whole history.
I have already stated at the beginning of my speech that to a certain extent we are being handicapped not only by circumstances overseas, not only by inevitable circumstances which are beyond our control, but we are also being handicapped to a great extent by the attitude of an irresponsible Opposition in so far as this development and expansion of a sound South African economy is concerned.
Why do you say “an irresponsible Opposition”?
We remember the days of the referendum, the days when we became a Republic, the eventual withdrawal of South Africa from the Commonwealth; we remember the recent elections, we remember what has happened in this very Railway debate. Inside and outside this House, from platform to platform outside, all we had from the foremost frontbencher on that side to the hindmost frontbencher, from the foremost backbencher to the hindmost backbencher was a continuous long-winded refrain namely that because of its policy directive this Government was in the process of destroying the country’s economy.
We are discussing railway matters now.
As I said at the outset railway matters and the country’s economy are closely linked. We remember how the hon. the Leader of the Opposition himself set the ball rolling by calculating in detail and telling the fruit farmers of the Western Province how much they would lose on every box of grapes, on every tray of peaches, on every tray of pears and also on every bottle of wine as a result of our withdrawal from the Commonwealth, so much so that it would not even be worth their while to load the stuff on to the train to the docks for export. From platform to platform also in this House hon. members opposite cheerfully joined in that refrain; they followed the example set by the Leader of the Opposition. I am tempted to say that they all said “Yes, amen, so say all of us”. I think, for example, of the hon. member for Wynberg (Mr. Russell). That hon. member, the so-called leading light of the Opposition as far as Railway financial matters are concerned, had one object only throughout the years, as once again became clear during this debate, and that was to condemn. He is the person who told us that the Railways were heading for such a financial crisis that they would have to go insolvent. Mr. Speaker, all those were predictions of a prophet of doom; none of them materialized and in spite of those sombre predictions the Railways have maintained themselves on a sound basis, and they were able to do so because we have a Government which has placed the economy of the country on such a sound basis that the Railways have had to develop in that direction. I am not saying that we will not have any further difficulties in connection with the Railways. I am not saying that the Railways will not again encounter difficulties in the future but I want to state this fact to-day that the Railways will develop and that the country will develop to its highest possible economic potential in spite of the sombre predictions of a miserable Opposition.
I also want to deal with the hon. member who interrupted me a few minutes ago. During the recent elections the hon. member for Turffontein (Mr. Durrant) was specially delegated to go to Kroonstad, the constituency which I represent, to tell the railwaymen what they tried to make the railwaymen believe in this House, namely that the Government was not treating them fairly.
The support we got there was wonderful.
I will tell the House what happened there. They held a meeting which was widely advertised. “Come and hear what the United Party wants to do for the railwayman.” Sir, the people of Kroonstad are very hospitable. We said to the people: “Look, we have a guest of honour here in Kroonstad, the hon. member for Turffontein; you must all go to the meeting”, because we knew who and what he was. We all knew that he was a loquacious and verbose member and we knew that the more he spoke the more would it benefit our cause. There were as many as 35 United Party members in the hall that evening as for the rest it was crammed full of railwaymen, 600 of them.
And there were about 20 Nationalist Party organizers to ask questions.
The hon. member for Turffontein did his best, and let me say at once that at the end of that meeting after he had done his best to tell the railwaymen what a good Opposition they were and what a bad Government this was and how badly this Government was treating them, a motion was put. Thirty-six people voted for them and 600 for the motion of no confidence in the United Party.
He is no longer listening.
No, it was just the other way around—full confidence in the United Party.
I want to say this that had the hon. member wished to do us the doubtful honour of addressing a further meeting there, their candidate would even have forfeited his deposit because the meeting which he held there for the United Party did them more harm than good and it increased our majority by at least 300-400 votes.
He is a good National Party organizer.
As he usually does in this House and outside the hon. member for Turffontein spoke a great deal of political nonsense that evening—political nonsense which he expected the railway-men to swallow. Let me say at once that the railwayman does not allow himself to be bluffed by political nonsense. The railwayman of South Africa knows what he has in this Government and the railwayman of South Africa knows how this Opposition treated him in the past. The hon. member for Turffontein in particular ought to know what is happening on the Railways, because he serves on the Select Committee and he has insight into all those reports, including the report of the Auditor-General and the report of the General Manager. He ought to have known better than to talk such political nonsense to the railwaymen of Kroonstad. He at least knows that no Government has done for the railwayman what this Government has done for him. Even in this Budget for this year an amount of R13,500,000 is being set aside to meet the railwaymen in respect of conditions of service and his allowances. He knows that during the course of the past 14 years under the régime of the National Party an average of R8,500,000 or over R8,500,000 has been set aside annually from the revenue of the Railways and Harbours and the Airways to improve the conditions of services of the railwayman. I challenged hon. members last year, and I challenge them again, to prove in any way that they did more for the railwayman when they were in power or to compare what they did with what this Minister and this Government have done for the railwayman. But they cannot and dare not produce figures because they know they will compare scandalously.
I have said that hon. members opposite were prophets of doom. All they do is to condemn and to oppose everything. They always side with our national enemies inside and outside this country. They take in position alongside those people who want to sabotage South Africa economically. By their actions they side with those people. I want to say this to the credit of hon. members opposite …
They are not so bad after all.
Yes, they are not quite as bad as that. I do not think they believe themselves when they spread those stories, because if they do they are more stupid than we think they are and I cannot believe that. I believe they are adopting that attitude because they have brought themselves into such a political position where they have to do anything to catch an odd vote. That is the reason why they are doing that.
But they do not catch anything.
I conclude by …
Thanking the Minister and the Government.
… thanking the Minister and the Government and the management of the Railways and every railwayman from the highest rank to the lowest for the love that they have shown to their fatherland and for their devotion to duty which has brought the Railways where they are to-day. We are convinced that they will continue along that road and eventually, in spite of the United Party, the Railways will become what it ought to be, namely a means whereby the country can develop economically to the utmost.
I have listened with interest these past few days to the debates which have been conducted here, and what has struck me particularly is the fact that there has only been one member of the Opposition, namely the hon. member for Simonstown (Mr. Gay)—and here I associate myself with the remarks of the hon. member sitting next to me —who has come along with constructive criticism. The hon. member asked the Minister whether in framing his Budget he had taken into account the anticipated industrial and economic development of this country. Amongst other things he pleaded for an expansion of our harbour facilities, to mention just one of the things that he advocated. The hon. member did reveal a little imagination, which goes to show that his spirit has not yet been blunted by the United Party mentality; he still considers what is best for our country and for our people. In the case of the other members the position was different; they were merely concerned to make capital out of the proposal that better salaries, better conditions of service and better pensions should be given to the railway workers. Yes, that attitude is a very popular one. Is there anybody who begrudges the workers better wage scales? The Government has proved its sincerity in past years by considerably improving their conditions of service and by giving them better wage scales. However, enough has been said in this debate in that connection and I do not want to enlarge upon it. The question is simply whether we can afford it at this stage and whether it is in the intersts of the country to do it at this stage. I think it was the hon. member for Orange Grove (Mr. E. G. Malan) who said that we should accede to the wage demands of the staff even if it were to mean an increase in tariffs. That is a dangerous proposition because, if the time is not ripe for it, it may lead to economic dislocation. We dare not lose sight of the fact that cheap transport in any country is the most important factor in its economic development, particularly in a country like South Africa with its particular circumstances and conditions, the long distances over which goods have to be transported, the productive hinterland which is situated far from our coasts. It was because of this that private undertakings did not show much interest in developing a railway transport system in our country, because superficially viewed such an undertaking would never appear to be remunerative. It is for that reason that the railway system in South Africa was built up with the capital of the taxpayer, not to produce big profits but to ensure the development of this country, based on the most economic transport system. The raising of tariffs therefore must always be regarded as a last step to make provision for increased expenditure. It is essential to have the lowest possible tariff system, and that fact is fully appreciated by the Minister, as is clear when we bear in mind that a commission was appointed to investigate the question of tariffs; because, together with the hon. member for Simonstown we too, as the hon. member for Kroonstad has also stated, expect an economic boom in South Africa in the near future with resultant increased productivity, greater exports of industrial and agricultural products, of raw materials and ores. In this respect we shall be forced to compete in the world market, and it will be necessary therefore to keep down our costs of production by means, inter alia, of a cheap system of transport, which is one of the factors in the costs of production. We must bear in mind the fact that the Republic of South Africa is entering a new period. It is only the pessimist, or members on the other side, or prejudiced persons who refuse to acknowledge that since we have left the Commonwealth, South Africa has entered a period in which a greater interest is being taken in the independent development and expansion of the industrial potential of our country. In addition to this there is the anticipated development of our reserves, which will provide a stimulant for development that will perhaps exceed our greatest and wildest expectations. In point of fact it is only the uncertain international situation which is still retarding the rate of development. That is why the Minister has to take steps in advance to ensure that when the anticipated development does take place, South Africa will not again find herself in a transport crisis, as was the case some years ago as a result of the shortsighted policy followed by the previous Government. Perhaps it was because the Minister bore that in mind that he decided not to use his surplus, about which we hear such a great deal, to distribute alms but rather to consolidate the position of the Railways so as to meet the anticipated future development. That is how I understand the strengthening of the Rates Equalization Fund, the provision for the high cost of replacement, etc. All this in being done to meet the demands which may possibly be made on the Railways in future.
But there may be times of uncertainty and of recession ahead of us, times which have to be bridged, and we are glad therefore that at this time when there is uncertainty and a certain amount of recession in the agricultural field particularly, the railways are helping to see the agricultural industry over that period. This brings me to the role which the railways play in connection with agricultural development in South Africa and to the contribution made by the railways to stabilize our agricultural industry in South Africa. It is not generally realized perhaps that if it had not been for the cheap transport provided by the railways, the agricultural industry would not have developed to the extent that it has developed. Just think of the low tariffs at which certain agricultural products and requirements are transported. The interest taken by the farmer in transport has increased considerably since the last war. The gross yield of agriculture has increased fivefold. Here I am quoting figures which are rather old, but for the purpose of my argument they are perfectly valid. There may have been a further increase in the past two years, but the fact of the matter is that the gross agricultural yield since the war has increased fivefold. It has increased from R128,600,000 to R680,000,000. Every year the farmers of the Republic spend R180,000,000 on supplies, fertilizer, seed and spare parts, and approximately 13,000,000 tons of products are transported every year by rail and road motor service to the various stations or the various harbours. We have approximately 13,000 miles of railways and more than 200,000 miles of roads over which the products of the farmer are transported. I quote these figures to show that the tariff structure can have a great influence on the agricultural industry, particularly in these days when there are large surpluses of certain agricultural products, and as the result of that we shall have to compete on the world market. In order to compete there the farmer will have to produce his products as cheaply as possible. That is the exclusive responsibility of the farmer himself. But in order to be able to compete we must have cheap transport and we must be grateful to the railways for having made it possible for the farmer to transport his products cheaply. On the other hand this assistance to agriculture must not be viewed as relief or as a charitable service. On the contrary, the population potential in any country is in inverse proportion to the food that the country is able to produce, and the fact that we have surpluses of food is due to the fact that the development of this country as a whole has not yet struck the necessary balance. That is why surpluses of certain agricultural products will be something of the past when the anticipated industrial and mining development gets into full swing and when the Reserves have been developed. In these days the railways also have to make their contribution to keep our agriculture industry stable. At the moment agricultural development is going through a transition period in a certain respect, and it is here that the railways have to provide assistance. When I talk about the railways I include everybody and everything; there are the road motor services which suplement the railway services. The road motor service is perhaps the biggest boon to the farmer. Since the road motor service has been placed at the disposal of the agricultural industry, it has expanded enormously and it is of incalculable value to us. We cannot imagine having to do without the road motor service. Just think of the service given to the farmer through the transport of his fertilizer which is delivered to him at very low cost right inside his store; think of his wool, his grain etc., which is loaded on his farm and transported to the nearest railway station. Unlike the private entrepreneur the railways accept full responsibility and provide cover against damage. This road motor service operated by the railways also provides healthy competition, and an incentive for the private entrepreneur to transport the farmer’s agricultural products at a rate which is as reasonable as possible. It is gratifying to see therefore that the loss on the road motor service last year was only R156,293 in comparison with R294,256 the previous year. Firstly it is a sign that this service has come to stay, and secondly it is gratifying to us to see that this service can in fact be operated economically. This loss is insignificant if one takes into account the enormous scope of the service. In 1960-1 the revenue was R11,654,895 and the number of vehicles with which this amount was earned was 1,200, inclusive of all vehicles.
I want to conclude by saying that the railways will remain the biggest factor in the development of our country, just as it was the factor in the past which opened up the hinterland and made possible our mining, industrial and agricultural development. That is why the railwaymen will always occupy a particular place in our national economy. That is why this Government, and any Government which may take its place, will always be compelled to do justice to the railwaymen. Was it not the railway engineer who had to devise and plan everything in order to link up the distant hinterland in the most economic way with the coast; is it not the railway signalman who constantly has to keep a watchful eye to ensure safety; is it not the railway ganger who has to keep the track safe day and night; is it not the engine driver to whose capable hands we entrust the lives of thousands? I have mentioned a few of the categories of workers. The railwayman is not going to be misled by idle promises. He regards his work as a calling and he places his services at the disposal of the Republic of South Africa to build up a sound, well-balanced economy which will ensure the peaceful co-existence of all races.
I don’t know why the hon. member for Kroonstad (Mr. H. J. van Wyk) was so unfriendly towards this side of the House to-day. As for his criticism that this side never advances constructive criticism, that has been disproved by the Minister himself. If the hon. the member would go back and read the hon. Minister’s speech, he would see that the Minister has at last had the good sense to accept some of the advice we have been giving him here for years. The hon. Minister will recollect, and hon. members on the other side will recollect that for the past four years, members on this side had pointed out to the Minister that his system of railway rates is outdated, and not only that it is outdated, but that it completely clashes with the general policy of his Prime Minister. The policy of the Government at present, as we understand it on this side, is to encourage decentralization of industries as much as possible, especially along the border areas of the Native reserves. And yet for four years, the hon. the Minister persisted, four years after this policy was announced, with a railway rating policy, which he had inherited from the past and which acted in the opposite direction, which far from encouraging the decentralization of industries, tended to encourage centralization of industries. Last year, and the year before, I can still recollect how the hon. the Minister told us that we were just theoretical economists when we argued this point that surely the present railway rating system worked against the vision of the Prime Minister of the decentralization of industries and the development of industries on the borders of the Native areas. Now in his speech, the hon. Minister makes that very admission that in order to further the development of border industries, he has now appointed a commission to go into the whole question of the principles of rating with a view to encouraging this national development. In view of that, I think we must take with a pinch of salt the allegation we always hear from the other side that criticism from this side of the House is completely unconstructive, while we assisted this Minister to come to the aid of his Prime Minister at last.
It is quite clear that the hon. the Minister is quite proud of the surplus that he has achieved, but if one analyses what has caused this surplus, I cannot find in the Minister’s speech any indication that this is due to greater efficiency and that the Railway Administration has been improved greatly and that economies have been effected. In fact, if one goes into the causes why this surplus has arisen, one finds that this surplus is really due to the mistake that the Minister made last year when he took a very gloomy and very dismal view of the future and apparently completely under-estimated the volume of traffic that the Railways would be called on to carry in the year 1960-1. According to the Minister’s speech, he budgeted for a drop in traffic from 88,000,000 tons in 1959-60 to 76,900,000 tons in 1960-1, a drop of very nearly 12 per cent. I do not know why the hon. the Minister had such gloomy views last year this time. Admittedly his Budget speech was made shortly after we had left the Commonwealth, but apparently he completely over-estimated the consequences of South Africa leaving the Commonwealth and he estimated for a very big drop. It is further very amazing in view of the fact that at that very time all the economic indications were that the level of economic life in South Africa would be more or less the same in 1960-1 and that there even might be a slight improvement over 1959-60. In such ways is the Minister building up his reputation. He is now claiming that he is a wonderful Minister of Railways, because he made a mistake in his budgeting last year.
I have claimed nothing.
Well, I am sorry, I got the impression that he was claiming to be a very competent Minister of Railways and that he was very proud of his surpluses. It does show that it is much easier to make a reputation for yourself in politics than in business, because any businessman who would make such a mistake in his calculations, would be hauled over the coals by his shareholders for having read the future so wrongly.
Mr. Speaker, I am told that in the world of woman’s fashions they say that the art of designing is to reveal as much as possible of what you conceal. I think the hon. the Minister acts on the opposite principle. He conceals as much as possible of what he reveals.
Does that not make a woman all the more interesting?
Mr. Speaker, if one reads the hon. the Minister’s Budget speech, there is very little analytical about what is happening in the Railways. It is awfully difficult for an Opposition like we are, where we are denied a lot of expert assistance and advice behind the scenes, to judge a budget like this unless the Minister is prepared to take us into his confidence. Now the Minister’s whole speech consisted largely of padding. If you read his whole speech it is very difficult to make an objective assessment as to whether the Railways are really being run efficiently or not. To give you an example of what I mean, Mr. Speaker, take this question of over-estimating capital expenditure. Here we find that in the past year, the Minister has again overestimated his capital expenditure. He estimated the capital expenditure at a total of about R103,000,000. In fact R28,000,000 of that amount is not going to be spent, almost 25 per cent. So he has again over-budgeted by an amount of R28,000,000. But of course in the documents he calls that savings. It could only be savings if in the first instance that expenditure would have been wasteful. If that expenditure in the first instance was economic expenditure, then that is not a saving. From an economic point of view it is a loss, because it would have been used had it been economic expenditure. But not a word in this whole speech on this very important item. The Minister does not take us into his confidence as to why he comes to Parliament asking for such large amounts of capital investment and then proceeds to spend only three-quarters of that. The amazing thing is of course that this is not the first year that this has happened. This is now the third year running that we get this phenomenon that the Minister asks for far more money than apparently he is capable of spending, or on second thoughts, he considers necessary to spend. If we turn to the Auditor-General’s Report for 1960-1 on Railways, we find in paragraph 50 (2) comment being made that—
Then they go on to say—
If one looks at the table on that same page, one finds that from 1957-8 when the Railways spent R137,000,000, there has been a gradual rise in the amount asked from Parliament every year for capital expenditure but not spent. And in the same Auditor-General’s Report we get a most remarkable explanation for this occurrence in respect of the year 1960-1.
You are now making the same speech as the one already made by the hon. member for Port Elizabeth (South) (Mr. Plewman).
No, I am approaching the matter from a different aspect. He just showed how bad the budgeting was, and I would like to indicate from the economic point of view how bad that is for South Africa and for the Railways. The Auditor-General deals further with this matter. The Secretary for Finance asked an explanation for this under-expenditure and they received a letter from the Administrative Secretary of the Minister of Transport in regard to the undrawn amount of R49,600,000, and this is the explanation they got from the Department of Transport—
What a department! Surely you would think that when they ask for the money, they have their estimates and they have considered whether they can spend the money. In plain English it means that after they had asked for the money, they discovered that they could not spend it. Where this country has limited capital resources and where it is the function of the Government to allocate the available capital amongst all the various competing demands to the best possible advantage of the country, surely you don’t come to Parliament and ask for vast amounts to find a short time after receiving authority to spend these amounts, that the Department is not capable of spending it. But some of the explanations are even more weird than the first one—
One would have thought that in a well-run organization that would be done beforehand, before asking for the money—
Then they go into details and give more specific reasons why the money was not spent. I just want to read two of these reasons—
- (a) As the result of a shortage of experienced technical supervisory personnel, especially engineers, it was not possible to make the expected progress with the execution of civil engineering works.
How can the Minister come here in March, when he should know what his technical staff situation is, and ask for vast amounts of money and then come back within a year and say: When I asked for that money I did not really have the engineers to spend the money. That is what the explanation boils down to. Then there is another weird explanation, another reason given—
It is the first time in my life that I have ever heard that you have got to wait until the end of the year to decide what level of stocks you will require. That is really what it boils down to. They say that they have to wait until the end of the year to decide what level of stocks would be necessary. This certainly does not make sense in commercial circles.
What makes this explanation even more curious is the fact that in the previous years, 1958-9, and 1959-60, the Department was apparently physically in the position to spend R154,000,000 and R140,000,000 respectively, but suddenly they found in 1960-1, that they could not spend R143,000,000 and would have to spend a far lesser amount. What has happened in the Department in that short period to bring about such a change that suddenly they find it physically impossible to spend a far lesser amount than in the preceding years? This letter was written at very nearly the same time when the hon. Minister introduced his new Budget, and knowing all the difficulties, he comes to this House and asks the country for R113,000,000 whereas he now tells us that he finds that he only requires R78,000,000. I hope the hon. the Minister will explain this to us.
As has been emphasized by other speakers, to over-estimate expenditure to this degree makes in the end for wasteful expenditure, because as the hon. member for Port Elizabeth (South) has already indicated, there is the second law of Parkinson that it is only a question of time and expenditure rises to income. The same goes for money budgeted. If you vote sufficient money, people in the end will find ways and means of spending the money and this leads to wasteful expenditure. Coming to Parliament and asking for far more capital than is really required, must encourage wasteful expenditure, unless the Railways is not a human institution. In most human institutions the tendency is there that when you have more funds than you really require, that undertaking starts spending the money wastefully. Moreover, despite this huge short-fall in capital expenditure during the last three years—a short-fall incidentally during the last three years of R93,000,000; in other words, the railways asked for R93,000,000 more than they were apparently capable of spending— despite this short-fall, the Minister assures us that the railways can handle all the traffic offered. The question arises then: Was this intended expenditure really necessary. If the railways are in a physical position to-day, despite the fact that they have not been capable of spending the full amount of money they asked for, to handle all the traffic offered, one asks oneself does that not prove that the Minister in the past has asked for too much capital? Some further proof of this proposition seems to be contained in the fact that despite the fact that these vast amounts have been under-spent in the past, the Minister has this year only asked for R82,000,000, well below the figure for the past three years. If it is simply a question of the Department during the past three years not being physically capable of spending the amounts asked for, then the question arises: Why this sudden drop? The railways must be particularly careful with their capital expenditure programme. It represents a very large share of national capital expenditure, and it can have far-reaching results on the economy of the country as a whole. Therefore in particular this Minister should plan his expenditure well ahead, and as far as possible he should not have these wide variations that we have seen in the last five years, varying from R152,000,000 to R82,000,000, because this sort of rock-and-roll type of expenditure has its effect on industry. If you spend too much it is inclined to cause inflation, and if you suddenly cut down on your expenditure it has deflationary influences. The Minister knows that the demand for railway services rises at a fairly steady rate. As far as possible he should try to spread his expenditure over a number of years as evenly as possible. What is more, the only possible circumstance in which he can depart from that principle would be if his policy of investment were part and parcel of a larger national policy so that the railways could act as a sort of anti-cyclical institution— what is commonly called anti-cyclical expenditure. When it appears that there might be deflation the railways should step up their expenditure and when it appears that there might be too much inflation the railways should reduce their expenditure. It is quite clear that has not been the policy of the Minister hitherto.
Mr. Speaker, I shall continue to-morrow to give the Minister some more constructive criticism. I therefore move—
That the debate be now adjourned.
Agreed to: debate adjourned until 14 March.
The House adjourned at