Mr Speaker, I move:

1. INTRODUCTION

“Economic and financial conditions are continually subjected to local and foreign influences. Although policy and policy measures are continuously adapted to changing circumstances, it is nevertheless necessary from time to time to analyse matters thoroughly and, as required, even to make drastic adjustments to one’s course.” These words come from the exposition of policy by the hon the State President in his address at the opening of Parliament on 5 February this year; and they are of profound significance.

That address has been hailed on all hands as a watershed in our approach to economic policy. Even the most critical commentators could find no flaw in the underlying logic and coherence of the strategy for a better-functioning economy enjoying high but sustainable growth coupled with price stability.

And this initiative is being taken in the face of the restrictive influence of wide-range international action in many spheres, and despite a diversity of adverse factors operating in the domestic economy from time to time.

Two fundamental realities must be faced in any evaluation of the South African economy: The first is that any unravelling of the problems in the most important fields of our national life—the constitutional, the social, the security and the economic—makes almost insuperable demands on our financial capabilities. The second is that our economy is hamstrung by a host of politically-motivated and internationally-orchestrated restrictions that distort the optimal allocation of the resources with which our country is so richly endowed. The outcome is that our ability to channel even the resources we already possess to the areas of greatest need is constrained.

In short, South Africa no less than any other responsible and self-respecting sovereign country wishing to ensure its survival must use for this purpose costly resources in many fields—resources that would otherwise be available for the general good of its people.

The unnecessary counter-productivity of the sanctions and boycotts increasingly staring us in the face, and their futility as a means of bringing about so-called solutions, must be manifest to any objective analyst of South African realities.

The remarkable performance by the economy despite these onslaughts certainly strengthens us in our resolve to solve our problems ourselves. These sanctions and boycotts are nonetheless a fact of our economic and financial life; and they serve a purpose insofar as they force us to put everything into so using our resources as to extract from them and maintain the maximum economic advantage. Only thus will we be able to provide the necessary financial support for attaining the goals of reform in the other spheres to which I have referred. No lasting solution to South Africa’s problems will be possible without an exceptional contribution by the economy.

The significant financial and economic measures taken by the Government in recent years both to counter the impact of the restraints imposed on us from abroad and to promote the progress and security of the country have thus been vindicated and encouraged by the prospect presented by the hon the State President in his opening address.

It is also the duty of a responsible government to safeguard the interests of its older citizens and of the less-privileged, as we have in fact done in previous budgets so far as our country’s capabilities permitted. Compassion will find a place in today’s Budget too.

Similarly it is the duty of the Government to grasp the special opportunity now created by a conjunction of more favourable economic factors and intensify the fight against inflation so as to protect our people against its destructive impact. At the same time the opportunity should be used to underline the positive role each individual can play in this fight by developing, more than ever before, price sensitivity in his spending and productivity in his work.

Obviously this Budget must also form an integral part of the Government’s long-term economic strategy—a strategy that must itself be continuously developed.

Comprehensive tax reform does not happen frequently. One of its results is usually a redistribution of the tax load, which necessarily means that some taxpayers will ultimately pay less but others—unfortunately—more. This rearrangement of the tax load should therefore preferably take place gradually to avoid disruption as far as possible, and it will only be possible to attain the desired objectives after a number of tax years have elapsed.

As will appear from the figures, some tax changes have immediate cash-flow implications for both the individual and the fiscus, while others will first have a noticeable impact in the next tax year. Because it has been sought to spare the individual taxpayer inconvenience as far as possible, the fiscus will face cash-flow problems stretching over two or more years. This obviously affects the perspective from which both the Budget and the tax proposals should be judged.

As is by now well known, everything possible is being done to contain aggregate state expenditure within affordable limits; and the increase in expenditure in this Budget is thus negative in real terms. This slots in with the broader approach to economic policy. But since this move into the new financial year is itself off a relatively high base of public spending, the level of the budgeted expenditures still places considerable pressure on the revenue sources open to us, notwithstanding firm fiscal discipline. This means that revenue foregone as a result of the tax changes now coming about must be recouped elsewhere where it can be afforded. These increases will not necessarily form a permanent part of the tax system.

In the past two years Israel has achieved a striking success by bringing annual inflation down from over 400% to 16%, and the will is there to bring it down even further. I was recently informed at high level that this success could be achieved because—apart from a whole host of other measures—the authorities in Israel had reached an accord with their trade unions whereby all wage and salary earners were prepared to accept a drop of no less than 30% in income as their contribution to the campaign against inflation.

This is a truly notable achievement for the people of a threatened country buffeted by war and unrest and grappling with its own peculiar problems in agriculture and other sectors of the economy.

Israel is going to hold a general election in the near future. Almost as remarkable as their solidarity against inflation is the fact that as I am informed, the various political parties have mutually agreed that in the national interest they will not make the question of wages and salaries a political football in the election: that would endanger the progress already made in putting their economy back on its feet.

Regrettably, the question of general salary increases in the public sector has on several occasions been dragged into our own political arena, and I shall therefore dispose of it here rather than in the more technical sections of the Budget.

During the past few years—which were extremely difficult ones—the Government has on several occasions, and sometimes even in an unorthodox manner, sought by means of increased state expenditure to achieve specific objectives with regard to growth, job-creation, housing supply, disaster relief and so on.

Once the goals had been reached the State necessarily had to start reducing its share in economic activity, in favour of the private sector. Failure to do this would have brought the risk of overheating of the economy. That is why state expenditure, after some years of having sharply increased, must now be pruned to normal affordable limits.

Having drastically pruned departmental requests for the financing of services in the 1988-89 financial year the Government came up against the stark fact that a general salary increase this year would carry grave implications for both expenditure and financing.

To finance a substantial general salary increase by means of loans would have meant the following: The use of bank credit would have created money, been of brief advantage and highly inflationary; long-term loans to finance recurring current expenditure of this magnitude would in like manner have meant the further distortion of the ratio of current expenditure to loans—exactly the opposite of what we should be striving for; and an exceptionally large deficit before borrowing would have placed strong upward pressure on interest rates, with all its attendant disadvantages.

Considerable and wide-ranging tax increases would therefore have had to be imposed in order to support a meaningful general salary adjustment in the public sector. This would surely have been conducive to neither a positive business climate nor sound economic development.

A responsible Government must be alive to its duty to protect the dearly-bought advances on the road to economic recovery; and the Government therefore had no choice but to act as it had been compelled to do in the difficult years of 1984-85 and 1985-86, and limit this financial year’s rises to the normal notch increases and a few occupation-specific adjustments. But this is erroneously being branded by the ill-disposed and the ill-informed as a “wage freeze”.

I recently received a most inspiring letter in this regard from someone who has made his mark in various fields in this country: who, indeed, is well-known both here and abroad, even after his retirement.

Among his other comments there was this striking one:

In hard times any government with a claim to being responsible unfortunately cannot do the good things it would wish for its work force in the sphere of remuneration.

In the trying economic circumstances of the past few years retrenchments and insolvencies in the private sector multiplied to reach unprecedented heights. No employee of the State, however, lost his position for comparable reasons, and the basic job security the State offers therefore remains a valuable asset for its personnel.

With its decision on staff remuneration the Government has set a vital example—namely, that now is the time, in more favourable circumstances, to break the devastating spiral of interaction between price increases chasing salary increases and vice versa.

Indeed, the overall assault on inflation is just as much a fight against expectations regarding inflation as one conducted via fiscal and monetary policy and other actions to keep price increases low. For that reason the hon the State President was fully justified in asking the private sector, in the national interest, for its support in the ending of these expectations themselves as well as the practice whereby virtually automatic price and salary increases have become almost a way of life.

In practical terms there are thus two facets to this approach: Firstly, that we now have a golden opportunity to put an end to the practice that has become routine with some undertakings, namely to keep raising prices because “the market can bear it” or because they have built their own high inflation expectations into those prices. This is nothing more, at the end of the day, than a self-fulfilling prophecy—but also a self-destructive one! Secondly, that the national interest now more than ever before requires that in their wage negotiations—which are their good and inalienable right—our wage- and salary earners follow the example set by the Government in keeping the national interest in view. At the same time care must be taken that prices or tariffs—or even taxes—are not raised to pay for the increases.

The hon the State President has repeatedly said that we do not want a totally regulated economy, since it can no more work here than anywhere else in the world. That is why price and wage control is not an acceptable option for this Government. In line with the Constitution, our choice is the promotion of an economy in which market mechanisms function properly. Where that mechanism is still imperfect on account of our country’s special circumstances we have, apart from other steps, appointed public watchdogs such as the Competition Board and the Consumer Council. The Government thus intends to grant these bodies sufficient powers to carry out their functions properly, and further legislation is already being considered. A stronger and more price-conscious Consumer Council would however be a futile exercise unless the public itself is price-sensitive and thus by its preferences exerts a stabilising influence on consumer prices.

I trust that the incorrect and naive interpretation that the Government is trying to implement a general price and wage freeze in the belief that this can smash inflation overnight will now disappear. The true answer to inflation lies in the longer-term impact of the maintenance of basic discipline by the Government and the individual alike.

The Expanded Budget Speech

The Budget speech is constructed by choosing from a comprehensive survey of the economy and the Budget prepared by the department. We have decided to table the full review this year as additional information. This arrangement can be continued if it proves of value.

†2. ECONOMIC REVIEW

Economic Growth

After displaying a hesitant recovery in the second half of 1985 and part of 1986, the South African economy in the course of 1987 and early 1988 moved into a more vigorous cyclical upswing.

For the 1987 calendar year the rate of growth of the real gross domestic product amounted to some 2,5%. This compares with a growth rate of 1% in 1986 and a decline of 1% in 1985. Virtually all sectors of the economy contributed to the increase in production in 1987, except mining, which was hit by a drop in overseas demand for its products and by strikes. Agriculture again faced fluctuating circumstances as the result of unfavourable climatic conditions; but the farming, forestry and fisheries sectors, nonetheless posted a real increase in production of 2,7% in 1987.

Total real gross domestic expenditure in 1987 grew by nearly 5% and in the fourth quarter of 1987 was more than 10% higher than in the fourth quarter of 1986. This was primarily a result of continued steady expansion of real private consumption expenditure. Although total real gross fixed investment still declined in 1987, albeit slightly, after having dropped sharply in 1986, real private fixed investment in 1987 showed a gratifying increase for the full calendar year.

Balance of Payments and Foreign Reserves

In 1987 the current account of the balance of payments once again recorded a very large surplus, the export of goods and services exceeding the import by R6,2 billion. Surpluses have now been recorded for 12 successive quarters. An important reason for this was the absence of excessive domestic demand, while the depreciation of the rand encouraged exports and discouraged imports.

The current account surplus allowed net gold and other foreign reserves to increase, on balance, by R2,2 billion in 1987 to R7,9 billion at the end of the year, while still permitting South African banks, other private enterprises and public bodies to make substantial net repayments of foreign debt both inside and outside the “standstill net”. The total net outflow of capital in 1987 was, however, only R4,3 billion, as against R8,4 billion in 1986.

For the greatest part of 1987 the effective exchange rate of the commercial rand was remarkably stable. For the year as a whole its value rose by 3,1%.

The exchange rate of the financial rand, however, strengthened by as much as 71% from the end of 1986 to 11 March this year. This reflects a more positive overseas perception of South Africa’s economy and prospects.

Inflation

The rate of increase in consumer prices, measured over 12 months, slowed from 20,8% in January 1986 to 14,2% in January this year. This improvement occurred despite the increase in domestic expenditure, which confirms that recent inflation in South Africa was not the result of excess spending but can rather be attributed to other factors such as the depreciation of the rand in 1985 and 1986.

It is also very encouraging that the production price index rose by only 11,8% from January 1987 to January 1988. It is, of course, still an important objective of fiscal and monetary policy to depress the inflation rate still further.

Employment

Employment recorded a moderate increase in 1987. The number of White, Coloured and Asian unemployed fell sharply, from 77 870 in December 1986 to 64 840 in December last year and, according to the current population survey, the number of Black unemployed also fell significantly between July 1986 and October 1987.

Developments in the Monetary and Banking Sector

In the course of 1987 bank credit and the money supply began to increase at a progressively rising rate in line with real domestic economic activity. Although the money supply M3 grew during the first three quarters of the year at a comparatively low rate, the tempo accelerated sharply towards the end of the year. In the fourth quarter M3 was 15,5% higher than in the same quarter of 1986, which meant that the total increase in the money supply over the year fell within the target range of 14% to 18%.

Most interest rates thus began to rise after November 1987 in line with credit demand. In late January 1988 the commercial banks raised their prime overdraft rate from 12,5% to 13%; and on 9 March 1988, when the Reserve Bank raised its bank rate from 9,5% to 10,5% in accordance with the rising rates in the market, they announced a further increase, to 14%.

Review of the Policy of the Past Year

The expansionary short-term fiscal and monetary strategy for 1987-88, as set out in last year’s Budget Speech, achieved its major objectives. Firstly, it contributed to the desired increase in consumption, investment, production, trade, employment and real economic growth.

Secondly, this objective was achieved in such a manner that it went hand in hand with a noticeable further reduction in the inflation rate, the maintenance of a large surplus on the current account of the balance of payments, the strengthening of the gold and foreign exchange reserves and a remarkable performance in foreign debt servicing.

3. MONETARY AND FISCAL STRATEGY

In the light of the favourable results achieved in the past year with monetary and fiscal strategy it is important to note that the present position of the economy differs greatly from that of a year ago and calls for an adjustment in that policy approach.

In the field of monetary policy a less accommodative approach by the Reserve Bank is now indicated. Excessive credit creation by the bank at this stage could easily lead to an exceptional increase in the money supply and aggregate expenditure, which in turn could lead to new demand inflation, balance of payments problems, and downward pressure on the rand.

The Reserve Bank has therefore set a new target range for the rate of increase in the broad money supply M3 between the fourth quarter of 1987 and the fourth quarter of 1988, namely between 12% and 16%.

The bank has also indicated its determination to reduce its own rate of credit creation so as to prevent an overshoot in the money supply target. To this end the bank rate was raised on 9 March 1988 from 9,5% to 10,5%. Although this increase was mainly a technical correction in response to increases that had already taken place in most other money market interest rates, it also signalled the start of a less accommodative policy by the Reserve Bank.

Fiscal policy too must slot in with this less expansionary approach. It is particularly important that this year’s increase in State expenditure be kept within reasonable limits. The rise in the spending of virtually all State departments has therefore been drastically pruned in this Budget, while a standstill has been introduced with regard to the growth of public sector employment. Similarly, provision is being made only for normal notch adjustments and limited occupation-specific increases.

As to State revenue, an attempt is now being made through early application of certain recommendations of the Margo Commission to protect the revenue base against further erosion and to enlarge it.

In recent years the Budget deficit before borrowing has emerged increasingly as a key variable. It remains an important objective to keep this deficit over the following few years to as little as 3% of the gross domestic product so as to ensure that the demands of the Government on the capital market do not exert unnecessary upward pressure on interest rates.

It is important, particularly in the present stage of the business cycle, that monetary and fiscal policy be well co-ordinated and that these important policy measures maintain the correct relationship to each other in the delicate management of the economy. Only in this way can we ensure that interest rates do not have to rise too much, or that the exchange rate does not have to fall too much, or that inflation does not rise again. At the same time the proper policy package must ensure that the maximum possible rate of growth is attained over the medium and longer term. The present upswing in the economy must be carefully protected so that we may reap its fullest fruits.

4. OTHER POLICY MATTERS

Privatisation and Deregulation

For many years the State has been engaged in business activity in spheres such as industry and transport. There is no need to apologise for this. Indeed, through its initiatives in the establishment of Sasol, Iscor and the IDC, the State has stimulated important industrial development which lessened South Africa’s dependence on the outside world and created new job opportunities for many within the country.

However, in our changing times there is a need to shed State enterprise to the private sector and to unlock the financial resources at present frozen there and use them more optimally in line with the present needs of the country. The private sector is also in a better position to decide on the continued operation and expansion of these enterprises.

Over the past five years, to give an example, the three largest State corporations were responsible for no less than 30% of total net fixed investment—investment that to a great degree had to be financed by higher tariffs.

Privatisation does not involve only existing enterprises, but also the allocation of major new projects to the private sector. A good example is toll roads. Agreement has recently been reached with two consortiums whereby they will build, control and toll portions of the national road grid. In this way the sound economic principle of user charges will come into its own.

It stands to reason that the State should not dissipate the wealth obtained from privatisation by applying the proceeds for current expenditure. The redemption of public debt or the provision of other capital assets, such as infrastructure in developing areas, and the capital funding of small business development must be the first priority.

The hon the State President in his Opening Address to Parliament was quite unequivocal on this point and also mentioned the progress made in deregulation.

Deregulation therefore remains high on our agenda. Its main purpose is to promote the informal sector which provides a livelihood for many new and small entrepreneurs. In this way a great number of people will be able to support themselves.

Small Business Development

The Small Business Development Corporation is increasingly fulfilling an important role in our economy, particularly in job creation.

The Small Business Development Corporation, which represents a unique partnership between the private sector and the State, focuses on the promotion of small business. To this end it extends assistance at low rates of interest, and the State helps by way of interest subsidies for work creation and share capital, among other things. In the 1987 financial year no less than R13,5 million—to take one example—was provided to the SBDC for interest subsidies. This enables the corporation to obtain funds on the capital market, but to lend on to small businesses at lower interest rates. During 1987-88 the State’s total assistance to the SBDC was some R30 million.

The IDC has also recently launched a programme whereby small industries oriented towards exports or import replacement are assisted with finance at lower interest rates.

Certain forms of regional industrial development promotions are also designed for small undertakings—the so-called infant undertakings—and contribute to placing the informal sector on a more secure foundation.

State Financial Relationships with the TBVC-countries

The Government continues to work together with TBVC-countries in developing certain norms and standards with regard to Government revenue and expenditure to serve as a basis for transfers to these countries.

If this exercise is to be carried through meaningfully it must be judged against the results of the comprehensive study presently under way in connection with the financial relations between the several governments and tiers of government in Southern Africa.

The Margo Report

One of the outstanding events in the financial sphere last year was the release in August 1987 of the Report of the Commission of Inquiry into the Tax Structure of the Republic of South Africa— the Margo Report.

This report contains over 300 recommendations for the improvement and reform of the South African tax system and it has evoked wide interest among businessmen and the general public. In the lively debate following the release of the report, valuable contributions were made, and a special Task Group of the Department of Finance, under the chairmanship of the Director-General, processed more than 280 submissions and held a series of meetings with representatives of all sectors of the South African economy on the subject. The Task Group recently submitted its findings to the Cabinet, and a White Paper containing the Government’s decisions on the Commission’s recommendations is being tabled today.

Some of the proposals are being implemented already via today’s Budget, while others will first be implemented in the 1989-90 financial year. Many of the proposals are far-reaching in their nature and cannot be applied without further ado, but must first be discussed thoroughly with the private sector. Further consultations will be held immediately with representatives of the private sector, and it is hoped that the remaining proposals accepted by the Government will be implemented in the 1989-90 financial year.

In its report the commission expresses the opinion that tax reform is urgently needed in order to remedy certain defects in the present system. In particular, the structure of the tax system should be so changed that:

As a means of achieving these objectives the commission makes a large number of proposals for tax reform in the various sectors of the economy. Particulars of these proposals and of the Government’s response appear with full commentary in the White Paper.

Although the Government could not accept all the recommendations as they stood, and in some cases could accept them only after certain amendments, the broad guidelines and principles proposed by the commission are fully endorsed.

As already announced, the Government has not accepted the commission’s proposal for the introduction of a tax on value added in the shape of a comprehensive business tax; but the commission’s alternative proposal, that the existing general sales tax be converted into a tax on value added based on invoices, is acceptable. This conversion will, however, not take place before next year.

One of the results of this decision is that the commission’s recommendation for the separate taxation of spouses cannot be accepted. The splitting of married couples for tax purposes is a very costly process and simply cannot be afforded unless the Government can find an acceptable alternative source of revenue—something that is unfortunately not possible at present.

But there is no gainsaying the fact that with regard to taxation the married woman needs relief. The Government has therefore decided to accept the commission’s proposal for the introduction of a system of standard income tax on employees, SITE. This system will be implemented during the 1988-89 tax year. Where the married woman earns less than R20 000 per year it will greatly help her insofar as it will eliminate the problem of an additional assessment after the end of every tax year. Married women earning less than R20 000 per year and representing 83% of working wives on register will thus no longer have their income added to that of their husbands’ for assessment. I shall return to this subject when discussing the tax proposals for 1988-89.

The commission has also recommended that a capital transfer tax replace the existing donations tax and estate duty. This new tax should rest on a simplified basis and be levied at a flat rate of 15% on the value of transfers of capital for which full consideration is not paid. The commission has also recommended that a lump sum deduction of R10 000 per year during the taxpayer’s lifetime and R250 000 on his death be exempted from the capital transfer tax. Dispositions between spouses should also be exempt, as well as legacies to religious, charitable and educational institutions.

The Government accepts this proposal but has decided that the deduction for the annual lump sum should be R20 000 and not R10 000, and for an estate, R1 million. This generous concession will mean that a taxpayer can make dispositions of as much as R20 000 annually without incurring capital transfer tax; and an estate will have to be worth more than R1 million before attracting the tax. As the preparation of an amending Bill on capital transfer tax would take some time the existing legislation will be suitably amended during the present session of Parliament so as to bring similar relief as far as possible. The amended provisions will apply to the estate of any person who dies on or after today or to any donation made on or after today.

Various other recommendations accepted by the Government will be discussed later under the tax proposals for 1988-89.

The Government is of the opinion that the commission’s proposals, as they will be applied over the next few years, will help to create a sound basis for a higher growth rate in the South African economy. The tax burden will be spread over a wider area and cover more taxpayers, which will be more equitable. The total tax collections will thus in future grow to a much greater degree than previously in step with the economy.

5. FINANCIAL YEAR 1987-88

Full particulars of the pattern of expenditure in the current financial year have already been given in the additional budget speech. It will suffice to add that the budget overrun was limited to 2,1% of the main Budget and that the revised estimate of expenditure for the 1987-88 financial year amounts to R47,836 billion, an increase of 18,9% on the previous year.

On the revenue side total tax revenue last year is expected to be R37,822 billion, R621 million lower than that provided for in the main Budget. The most important deviation was in the mining sector which during the past year had to contend with sharp cost increases, strikes and a fall in coal exports. Gold mines will thus contribute an expected R500 million less than provided for in the Budget, while income tax payments by diamond and other mines are estimated to be R247 million lower. Collections from income tax on individuals are at present estimated at R11,900 billion, which reflects a relatively small shortfall of R200 million on the amount included in the last Budget. Payments by non-mining companies, however, should reach the budgeted amount.

As regards taxes on goods and services, the revenue from sales tax is expected to exceed the budgeted amount by R255 million while customs duty receipts, reflecting the upswing in the economy and in imports, grew by more than 24% as against the 1986-87 receipts. The abolition of certain rebates on the excise duty on distillate fuels contributed to estimated excise revenue exceeding the budgeted figure by R110 million. As a result of an overshoot on the estimated revenue from the sales tax on fuel—which since August 1987 has been collected by Customs and Excise as part of the consolidated fuel levy— revenue from this source will be only R700 million compared with the budgeted sum of R1,075 billion.

The revised estimates of revenue and expenditure resulted in a deficit before borrowing of R10,014 billion for the 1987-88 financial year, or about 5,8% of the GDP. Together with loan redemptions of R2,593 billion this brought the financing requirement to R12,607 billion. This was met, inter alia, by way of the purchase of stock by the Public Investment Commissioners (PIC) of R4,103 billion as well as the sale of stock of R4,785 billion to capital market investors, the latter amount exceeding the budgeted figure by a mere R435 million and thus not resulting in any upward pressure on interest rates.

Furthermore, as indicated last year, R1,200 billion of the so-called “Debt Standstill Funds” was used for Exchequer financing; R476 million of this represented funds that were converted into long-term loans.

On account of the popularity of the Senior Citizen Savings Bonds, net financing by way of bonds amounted to R857 million, exceeding the budgeted amount by more than R500 million.

6. FINANCIAL YEAR 1988-89

Revenue

In the printed Estimate of Revenue to be tabled today provision is made for total tax revenue of R42,840 billion, which represents a 13,3% increase on the 1987-88 revised estimate. Inland Revenue and Customs and Excise are expected to contribute R39,040 billion and R3,800 billion respectively.

The following revenue is expected from specific tax sources: Gold mines will contribute an estimated 17% less than in 1987-88 as a result of increased working costs as well as the recent fall in the gold price. As opposed to this, the improved profitability of companies is expected to result in a 21% increase in income tax from non-mining companies. An increase of 23% to R14,650 billion is anticipated for individual income tax, stemming mainly from increased salaries and the consequent bracket creep. Sales tax should contribute R11,600 billion to the fiscus in the coming year while an increase of 10% in revenue from excise duty is anticipated. The effect of the economic upswing is reflected in imports and should result in an estimated 13% increase in revenue from customs duty.

As already announced, the fuel levies previously going to the National Road Fund and the major part of those going to the Central Energy Fund will henceforth go to the Exchequer. The expected revenue from these will be Rl,010 billion and R330 million respectively and provision for these sums will be made in the Second Print of the Estimate of Revenue.

Expenditure

The printed Estimate of Expenditure for 1988-89 amounts to R52,933 billion, which is 12,9% above the 1987-88 main Budget of R46,868 billion. Estimated expenditure on capital services of R4,745 billion is 2,4% more than the R4,636 billion provided in the 1987-88 main Budget. As full details are provided in the expanded Budget Speech, a few remarks on certain expenditure items will now suffice.

Natal Flood Disaster

In addition to the R124 million provided in 1987-88 for immediate emergency aid in the Natal flood disaster, a further amount of R141 million is included in the 1988-89 Budget for the reconstruction of damaged infrastructure. Further sums in respect of the most recent floods are provided in the supplementary expenditure proposals.

Job Creation and Training

The continuation of the State’s job creation and training programmes is still regarded as important and necessary and R183 million is included in the estimates.

Progress with the Upgrading Programme

Since the hon the State President announced a special upgrading programme in 1986, an amount of R726 million has been made available and a further R106 million is now being provided for this programme.

Development Bank of Southern Africa

For the 1988-89 financial year the RSA Government has provided a further R371 million of its outstanding original five-year commitment to the Development Bank of Southern Africa. This brings the total contribution to the bank’s development fund to R1,525 billion.

Supplementary Expenditure Proposals:

Social Pensions

The Government is of the opinion that a degree of relief for social pensioners is both necessary and justified. A sum of R110 million will thus be included in the supplementary estimates for 1988-89 as a once-off bonus which will be payable to social pensioners during this year. Further particulars will be announced by the respective Ministers.

Savings Instrument for Senior Citizens

Senior citizens who are largely dependent on interest income are severely hit by both inflation and relatively low rates of interest. In order to assist them, the introduction of Senior Citizen Savings Bonds was announced in last year’s Budget. Due to the unforeseen popularity of these bonds and the potential threat of disruption to financial markets, their issue soon had to be stopped.

Due to the need that still exists for such an instrument and our undertaking to conduct further investigations in this regard, it has been agreed that banks, building societies and the Post Office will offer senior citizens a new savings instrument of fairly narrow dimensions.

The instrument will be available for a minimum period of three years and will be limited to individuals of 65 years and older, with a maximum investment per individual of R30 000. The return on the investment will be fully taxable, and the rate for the first 12 months will be 15% per annum. Based on the interest rates at present being offered to senior citizens on similar savings instruments by some building societies, the subsidy which the State under present circumstances will pay on this instrument will be about 2,5%. Full particulars of this savings instrument as well as the date on which it commences will be supplied shortly after further consultations on the details with participating banks, building societies and the Post Office. The new investment instrument is additional to any amount presently invested in the State’s Senior Citizen Savings Bonds. The interest rate on the latter will remain at the present 15%.

An amount of R20 million will be provided in the 1988-89 Budget for the State’s interest subsidy.

Flood Disasters

In addition to emergency relief of R141 million in respect of the 1987 flood disaster in Natal, it has been decided to include at this stage an additional sum of R200 million in the supplementary estimate as the Government’s contribution to the cost of the recent floods in Natal, the OFS and the Northern Cape.

Police

The transfer of the municipal police function from the provinces to the South African Police with effect from 1 April 1988 involves certain structural adjustments for which an additional sum of R72 million will be provided.

Municipal Rates on State Property

The principle that the State pay municipal rates on its property in local authority jurisdictions is embodied in the Rating of State Property Act, Act 79 of 1984. In addition to an initial contribution by the State of R111 million, as included in the printed Estimate of Expenditure for 1988-89, a further sum of R80 million is to be provided in the supplementary estimates in view of the intended full implementation of this Act on 1 July 1988. This brings the total provision to R191 million.

National Road Fund

As already announced, the fuel levy will from 1 April 1988 no longer be deposited in the National Road Fund. Provision must therefore be made in the supplementary estimates for the financing of the continuation of the function that previously was provided from that fund. A sum of R550 million for this purpose will be included under the Vote: Transport in the supplementary estimates.

Central Energy Fund

In the case of this fund, the continuance of its obligations for 1988-89 requires no contribution from the Exchequer, since the present substantial reserves are not affected by the decision to discontinue the earmarking of funds for this purpose.

Adjusted Expenditure Total

After provision has been made for the foregoing supplementary expenditure proposals of R1,032 billion, and a suspension of R100 million in respect of expenditure on the Defence Vote pending certain structural adjustment investigations, total expenditure for 1988-89 is R53,865 billion, an increase of 12,6% on the revised 1987-88 figure.

Tax Proposals:

Customs and Excise

Customs and Excise duties on beer, spirits and cigarettes are fixed amounts that have not been increased in several years and have therefore not kept pace with the substantial rise in the retail prices concerned. Between 1977 and 1987 the percentage rise in the duties on these products was less than a quarter of the rise in the consumer price index for beverages and tobacco.

The Margo Commission recommended that these duties be adjusted more regularly. The following increases in Customs and Excise duties are therefore now proposed.

Beer

The duty on all beer, whether locally produced or imported but excluding sorghum beer, is to be raised by approximately 1,9c per 375 ml bottle, popularly known as the “pint”, or 4,8c per litre. The estimated extra revenue will be some R70 million in 1988-89.

Spirits

The Customs and Excise duty on spirits such as whisky, brandy and gin is to be raised by approximately 1,8c per tot, ie 156,28c per litre of pure alcohol. This should yield an estimated extra R50 million for 1988-89.

Cigarettes and Cigarette Tobacco

The Customs and Excise duty on cigarettes is to be increased by 2c per 10 cigarettes and on cigarette tobacco by 2c per 50g. This should yield an estimated extra R60 million for 1988-89.

General

These increases take immediate effect and apply to all goods not yet cleared for domestic consumption. In accordance with section 58 (1) of the Customs and Excise Act, 1964, the formal tax proposals concerning Customs and Excise duties are now laid on the Table for parliamentary consideration.

Traders should sell the stocks purchased at the old rates of duty at current prices and adjust prices only once new stocks are received.

Inland Revenue:

Non-resident’s Tax on Interest

As long as South Africa requires foreign financing and is simultaneously constrained by foreign debt arrangements, this tax is an obstructive and cost-raising factor. Its base has already been eroded by many unavoidable exceptions and its abolition would involve a loss of revenue of about R30 million. It is proposed that from tomorrow interest accruing to foreign lenders will no longer be taxed.

Rationalisation of Company Groups

To facilitate the rationalisation of company groups provision will be made in the 1988 Revenue Laws Amendment Bill for a moratorium on the payment of stamp duty and transfer duty on rationalisation schemes approved by the Commissioner for Inland Revenue. The moratorium extends from 1 July 1988 to 30 June 1989. The consequential loss of revenue will be some R5 million.

‘Income Tax on Individuals:

Standard Income Tax on Employees (SITE)

For many taxpayers this is one of the most important recommendations of the Margo Commission that will be implemented this year. Simply stated this tax works as follows: For a man or a single woman earning remuneration at a rate not exceeding R12 000 per annum, or R20 000 in the case of the married woman, tax liability will be finally determined by deductions in accordance with the PAYE-system. These taxpayers will no longer need to submit tax returns.

This new system comes into operation in the current year of assessment, that is from the beginning of this month. Revised SITE deduction tables will shortly be issued to employers, but in the meantime the deductions will continue on the basis of the latest PAYE tables. This should eliminate most of the problems of the present final deduction system.

Where a married woman’s income is greater than the limit of R20 000 it will—less 22,5% (the existing tax concession therefore remains)—be added to her husband’s income and will accordingly be taxed at his marginal tax rate. The joint tax burden will however still be considerably higher in this case than if she had been subject to the SITE system. To soften the impact of this transition, a system of shrinking deductions will be introduced, which in practice will entail a gradual phasing-in of the higher tax rate which would have been payable above R20 000.

The loss of tax consequent upon the introduction of SITE will be R117 million in the coming year and R503 million in a full year.

The successful implementation of SITE will require the following further adjustments to the income tax system:

The present limited deduction with regard to these expenses does not take fully into account individual ability to pay, and taxpayers with large medical expenses are disadvantaged relative to those with smaller expenses. In addition it costs the fiscus some R420 million in a full year.

The Margo Commission has recommended that medical costs be allowed as a deduction only if they exceed 5% of taxable income, with no restriction on the amount deductible. The present system of unlimited deductions for those older than 65 should however be retained.

This proposal has been accepted and will be implemented this year. The existing separate deductions for physical disability and medical expenses will be combined and, apart from the 5% rule, there will henceforth be no limit to the deduction a physically disabled person can claim for expenses arising from the disability.

This new arrangement will generate additional revenue of R144 million in the 1988-89 financial year.

Rebate for Insurance Premiums and for Contributions to Provident and Benefit Funds and to the Unemployment Insurance Fund

The Margo Commission has found that the present rebate (maximum R75) for insurance premiums favours one savings medium above the others. The Commission also observed that this rebate costs the fiscus dearly—estimated at R145 million in a full year—but nonetheless gives no significant relief to individual taxpayers. Furthermore, in the case of provident funds a deduction of the employer’s contributions is allowed when the taxable portion of any benefit paid out is determined. The Commission therefore recommends that the rebate be abolished. This proposal has been accepted and will be implemented in the present tax year. The total revenue for the present financial year will be R65 million.

Dependant’s Rebate

The Margo Commission has recommended that this rebate too be abolished: the tax system should not recognise assistance to dependants, which moreover is something that can be abused. This recommendation is accepted. This source will not however provide the fiscus with any additional revenue in the 1988-89 financial year, but in a full year it should yield R18 million. The abolition of the foregoing deductions and rebates broadens the tax base and comports with the broad philosophy of the Margo Commission which the Government has accepted.

Rates and Rebate Adjustments

The Government places a very high premium on granting tax relief; and notwithstanding the limited room for manoeuvre in this Budget it has been decided to implement as far as possible tax measures that will be to the benefit of the greatest number of taxpayers.

It has therefore been decided to compensate taxpayers for any adverse effect of the abolition of the deductions and rebates.

Moreover, as frequently in the past, relief is given, to the maximum degree that can now be afforded, for the impact of bracket creep on the taxation of individuals. It is regretted that still greater relief is not possible—the room for this is unfortunately far too limited.

These decisions are brought to fruition by means of the following proposals. Firstly, it is proposed that the primary rebate for married taxpayers be increased from R920 to R1 100 and for other taxpayers from R650 to R750. The increased rebates will not only have the effect of reducing the amount of tax payable by all taxpayers, but will raise the threshold at which tax becomes payable.

Secondly, a rate reduction is proposed, the effect of which will be that the maximum marginal rate of tax now only becomes payable at a taxable income of R80 000 instead of the present R60 000. In the process the rates of tax of all taxpayers have been reduced. For example, the basic rate for taxable income less than R12 000 has been reduced from 15% to 14%. When the rate reduction and the increased rebate are taken together, taxpayers in the lower income bracket enjoy the largest relative reductions. The cost of these concessions for the 1988-89 financial year is R1,147 billion and for a full year R1,176 billion.

Thirdly, it must be recognised that these reductions, too, should not be seen in isolation, as the substantial relief granted to two-breadwinner families in terms of the SITE system will further reduce tax liability for this year.

Finally it should be pointed out, as was envisaged when the more realistic valuation of fringe benefits was proposed, that the foregoing concessions more than compensate for the extra revenue accruing to the State from the further phasing-in of fringe benefits tax, which revenue was estimated at some R200 million. Further particulars of the way in which company cars are going to be dealt with will be furnished in a few moments.

These measures, together with other tax proposals, represent only the initial steps on the road of tax reform; but they show the Government’s determination to make the tax system more responsive to the needs of the economy by not only making it simpler and more efficient but also by bringing into being a fairer tax dispensation. As to individuals in particular, the loss of tax consequent upon the introduction of SITE, the increase in the primary rebate and the reduction in tax rates amounts to R1,264 billion. When provision has been made for the additional burden placed on taxpayers by the withdrawal of the medical, insurance and dependant’s rebates, the total loss of revenue from income tax on individuals in the 1988-89 financial year is the substantial sum of R1,055 billion. This is certainly not to be despised. In addition virtually all taxpayers will gain from the proposed measures.

Company Cars

As a result of an urgent request from the motor industry, which was experiencing difficult trading conditions in 1986, the relevant values for company cars in the Seventh Schedule to the Income Tax Act was scaled down but with the understanding that they would be adjusted upwards as soon as circumstances so justified. It has accordingly been decided to adjust these values, and the necessary changes will be made in the table concerned. This decision too accords with the Margo Commission’s recommendations.

Tax Avoidance

It is disquieting that in so many cases repeated warnings on tax avoidance are still going unheeded. Over the past month various new schemes have been put into operation, some of which enable taxpayers without any risk to reduce their tax liability by a greater amount than the scheme itself costs them.

The Government remains implacably opposed to these artificial schemes. The Commissioner for Inland Revenue has been directed to give urgent and thorough attention to each and every avoidance scheme coming to his attention and to root them out by means of the legislation at his disposal or if need be to propose suitable amending legislation.

Minimum Tax on Companies

The Margo Commission in its Report refers to widespread criticism of those companies that by making use of existing concessions and incentives earn good profits and declare dividends while in no way contributing to the fiscus.

It has been decided to introduce a limited minimum tax on companies as a revenue-generating cash-flow measure, more or less along the lines proposed by the Commission. Tax will be levied on the company at the rate of 25% of so much of the dividends declared by it during a year of assessment as exceeds the sum of the normal tax paid for that year and the quantum of dividends received or accruing to it in that year. To ensure an income flow from this source during the 1988-89 financial year companies will be obliged to make a payment on the basis of their figures for the most recent year of assessment ending on or before 29 February 1988. It is intended that the tax for a particular year be based on the figures for the immediately preceding year. The tax will be payable on 30 September 1988, and on submission of a declaration. It will not be finally imposed but will be a credit retained against the company’s future liability for normal tax.

It is estimated that some R350 million will be collected from this source by the end of March 1989.

Taxation of Long-term Insurers

Although the Government has accepted the majority proposal of the Margo Commission on this tax, details of the application must still be settled by the Commissioner for Inland Revenue and the long-term insurers.

Under the present tax rules long-term insurers are taxed on 40% of their investment income and receipts from subsidiary companies. In comparison with other sectors in the economy, and given the magnitude of the investment funds that have been and are being channelled to the insurance industry, it seems that the long-term insurance sector should make a bigger contribution to the fiscus. It is therefore proposed that with effect from years of assessment ending between 1 April 1988 and 31 March 1989 the 40% factor be increased to 70%. This is expected to generate additional revenue of R170 million for the 1988-89 financial year and R202 million for a full year.

Stamp Duty on Debit Entries

The Margo Commission recommended the abolition of stamp duty and the duty on debit entries with the proviso that if the duty were retained it should also apply to transmission accounts with building societies and to the telebank facilities of the Post Office. The Government favours the provisional retention of the duty, and the alternative supplementary proposal will be implemented after consultation with the institutions concerned. The extra revenue from this source for the 1988-89 financial year is estimated at R15 million.

Additional Levy on Heavy Vehicles

Heavy vehicles pay an annual licence fee, as do light vehicles, delivery vans and mini-buses. Empirical studies have provided conclusive evidence that heavy vehicles do not in this way fully pay for their share of damage to roads. The Government’s White Paper on Transport Policy is clear on the point that road users should pay for the provision and maintenance of roads.

It has therefore been decided to introduce a heavy vehicle levy at Central Government level. This should raise an estimated R200 million in the 1988-89 financial year, which will go directly to the Exchequer.

Adjusted Revenue Total

The foregoing tax proposals bring the total estimated revenue to R5,320 billion for Customs and Excise (including the Central Energy Fund and National Road Fund levies) and to R38,685 billion for Inland Revenue: a total of R44,005 billion, or an increase of 16,3% above the revised total revenue for 1987-88.

The Deficit Before Borrowing and Financing

After the foregoing supplementary Budget proposals the estimated expenditure and revenue for the 1988-89 financial year are respectively R53,865 billion and R44,005 billion and the deficit before borrowing is thus R9,860 billion: about 4,9% of the estimated GDP. As loan redemptions will be about R2,671 billion (domestic stock R2,425 billion and foreign loans R146 million and about R100 million bonds) the State’s financing requirement for 1988-89 will be an estimated R12,531 billion.

It is proposed to finance this by stock sales to the Public Investment Commissioners of R4,600 billion, the roll-over of maturing stock which amounts to R2,425 billion, further capital market stock issues to the value of R4,350 billion and bond sales of R250 million. It is estimated that new foreign loans of R500 million at present within the debt standstill net can be converted into long-term loans to the State, while there is also provision for raising short-term loans (treasury bills) of R410 million for the financing of the Exchequer. The total financing available is thus R12,535 billion, leaving a small surplus of R4 million for the coming financial year.

These financing proposals should not exert upward pressure on the interest rate pattern.

7. COMPARATIVE STATEMENT OF THE STATE REVENUE ACCOUNT

As usual, a summary of the State Revenue Account is subjoined, as follows:

8. CONCLUDING REMARKS

The progress of the South African economy over the past year gives much cause for thankfulness. The recovery that began in 1986 gathered momentum, and towards the end of last year in particular it was displaying great strength. It is also encouraging that this upswing is now to a significant degree being propelled by private sector initiatives. Private consumption expenditure especially rose steadily, while real private fixed investment showed a satisfactory increase for the first time in several years.

This improvement in domestic economic conditions was accompanied by the maintenance of a large surplus on the current account of the balance of payments. While there have of late been indications that this surplus is contracting, it is still more than adequate to enable all foreign loan commitments to be met and also from time to time to add to the country’s foreign reserves.

Conditions in the money and capital markets, which for the greater part of 1987 were very easy, have also shown signs recently of tightness, and interest rates generally have tended upwards. But conditions are still very favourable for a further increase in the rate of economic growth.

Other favourable trends in the economy are the drop in the rate of inflation, the reasonably stable rate of exchange, the fall in unemployment and the general improvement in business confidence.

Against this background it has become necessary to effect a shift in the approach to economic policy. In preparing the 1987-88 Budget it was clearly necessary that the economic upswing, which was then in its initial stage, be further encouraged, and last year’s Budget was thus designed to be moderately stimulatory.

In the present circumstances, where the growth rate has substantially improved and the prospects are good for a further acceleration in overall economic activity, a more cautious approach is indicated. It is important that a sound balance now be obtained between our need on the one hand to secure the highest possible growth rate and on the other the awareness that factors such as the balance of payments, the availability of investment funds and the rate of inflation place firm constraints on our growth capability.

The Budget for 1988-89 is indeed linked to these needs of the economy. As much room as is appropriate is left for a further expansion of total private sector spending by keeping the Government’s own spending as low as possible. Only comparatively modest tax concessions are possible for the individual, but we have done what we could, within our financial constraints, to maintain the level of personal disposable income as far as possible. In this way the Government’s borrowing requirements are kept relatively low, as is reflected in the fact that in nominal terms the deficit before borrowing is marginally below last year’s, while as a proportion of GDP it has fallen from 5,8% in the previous year to 4,9% for 1988-89.

However, the Budget for 1988-89 not only takes the short-term cyclical needs of the economy into account, but also introduces a period of profound structural adjustment to the tax system, and of the further implementation of an appropriate system of control over aggregate state spending. Clear examples of further measures to control government expenditure are the move away from earmarked funds and the streamlining of the process of priority-determination for capital expenditure.

As far as the tax system is concerned, a number of the major tax reform proposals of the Margo Commission are now being put into operation. This reform action will be continued over the following year or two as the Government’s decisions on the proposals are implemented, as is indicated in the White Paper.

Finally, this Budget should also be seen as continuing the shift in emphasis in the approach to economic policy announced early this year by the State President: it seeks to facilitate the bringing into being of a sound and well-disciplined economy, in which the private sector in particular must play a vital role, and which must generate greater welfare for all the people of South Africa.

I should like to express my thanks to the hon the State President for his ready grasp of the issues at stake in the economy and of the steps that must be taken towards a better-functioning system with a high growth potential and greater price stability. I should also like to thank the Cabinet, Ministers’ Councils and the Heads of Departments for their understanding and co-operation. Fiscal discipline demands sacrifices, hard decisions and thoroughgoing management; and I thank them for their co-operation in this regard. I should also like to thank the Director-General and the Department of Finance. I have frequently paid public tribute to their sterling quality and their dedication, and I am happy to do so again. A special word of thanks goes to everybody involved in the preparation of this very difficult Budget. It was after five this morning when they left the office.

The evaluation of numerous alternative frameworks was very demanding and time-consuming before the finished product emerged. In particular, the Director-General, Dr Stals, and his Task Group on the Margo Report call for a special word of thanks for their thorough investigations and plain hard work in the preparation of the White Paper on taxation. I also thank my two colleagues the Deputy Ministers of Finance, and should like to express my congratulations to Mr Kent Durr on his well-merited promotion. Our good wishes go with him in his new portfolio. The selfless dedication of these two gifted colleagues is truly inspiring.

I should like to thank the South African Reserve Bank and the Land Bank. Both these bodies each make their own special and indispensable contribution to the management and development of our country, for which they deserve the thanks of us all. A special word of gratitude must go to Dr De Kock and the Deputy Governors of the Reserve Bank for their counsel in our several advisory, financial and monetary management forums.

I should also like to thank the Standing Committee on Finance: This Committee does extremely valuable work and is itself a testimonial to the discussion, advisory and control functions that the new constitutional dispensation has opened up.

9. TABLING

Mr Speaker, I now lay upon the Table:

1. (1) Expanded budget speech;
2. (2) Estimate of Expenditure to be defrayed from State Revenue Account during the financial year ending 31 March 1989 [RP 2—88];
3. (3) Estimate of Revenue for the financial year ending 31 March 1989 [RP 3—88];
4. (4) Statistical/Economic Review [WP B—88];
5. (5) Taxation proposals [P 2—88];
6. (6) White Paper on the Report of the Commission of Inquiry into the Tax Structure of the Republic of South Africa;
7. (7) Estimates of Revenue to be received for and Estimates of Expenditure to be defrayed from Accounts for Provincial Services during the financial year ending 31 March 1989:
   1. (a) Cape [RP 18—88];
   2. (b) Natal [RP 21—88];
   3. (c) Orange Free State [RP 24—88]; and
   4. (d) Transvaal [RP 27—88].

Bill, budget speech and papers tabled in respect of State Revenue Account referred to Standing Committe on Finance in terms of Rule 43(l)(a).

Papers tabled in respect of Accounts for Provincial Services referred to Standing Committees on Provincial Affairs in terms of Rule 43(l)(b).

The Joint Sitting rose at 15h30.

Mr Chairman, in his reply to the Second Reading debate the hon the Minister said he wanted to suggest to the hon member for Ventersdorp that the hon member keep politics out of the Post Office. Last year we heard that we should keep politics out of defence matters and also out of many other matters. We in the CP feel that we are here to talk politics, and we will use every budget debate to do so in order to take over the government. [Interjections.]

I want to go further. If the hon the Minister does not like politics, he can request the hon the State President to transfer him to some other position. [Interjections.]

I also want to refer to a remark made by the hon member for Boksburg. He asked who was going to dig the holes for the poles. He need only look around, when next he drives through his constituency, and he will see that Blacks are no longer digging the holes. That process has been mechanised. He should just have a look. [Interjections.]

There is another point I should like to make. Every time this side of the Committee refers to Whites, it is said that we are making racist speeches; or some other similar remark is made. [Interjections.]

I want to make an appeal to the NP today to decide, in their caucus meeting, to amend the Prohibition of Political Interference Act still further, before the new dispensation comes into effect, so that Whites can stand for election in Black constituencies and vice versa. The hon members on that side of the House, who are so concerned, can in future stand for election as representatives of the Blacks rather than the Whites. [Interjections.]

The hon the Minister’s announcement that there are to be no tariff increases sounded promising. He said in the same breath, however, that no general salary increases were going to be granted. What are the consequences of this going to be? Tariffs are going to rise so sharply during the Budget next year that they will compensate for these losses. The employee, however, will not be in the fortunate position of getting extra income next year to offset the increase in salary that he is foregoing this year. Next year it will be Hobson’s choice—pay up or else!

Furthermore, the Government has made an appeal to the private sector to practise moderation as far as increases in salaries are concerned. Surely, however, the private sector is not in the same position as the Government. The Government can simply announce that there will be no increases, and the staff associations will just have to accept it, because they do not have any right of negotiation.

The private sector’s position is completely different. In the private sector an agreement exists between employers and employees on the procedure for negotiation. In cases in which salaries are fixed, the employer has to negotiate. Should he refuse to do so he would be engaging in an unfair labour practice and the relevant trade union could immediately react in terms of the Labour Relations Act. If, therefore, the employer were not willing to negotiate, he would be forced to do so. If he were prepared to negotiate and granted a small increase, one could still act in terms of procedures provided for in the Labour Relations Act, and this could lead to a legitimate strike.

We in the CP want to make it clear that the CP will not interfere in collective bargaining. Nor do we look favourably upon the fact that Government employees and those in the private sector are being further impoverished because of the Government’s inability to curb inflation. The Government appealed once before for salaries not to be increased so that inflation could be combated, and hon members know that that appeal did not succeed.

Why did the Government not have the courage of its convictions and announce that no price increases would be allowed? I want to quote from Die Burger of 15 March 1988 in which the Director of the Consumer Council was reported as having said the following:

We think the private sector is going to announce more and more price increases; and once again, the employees are the people who are going to suffer because of those increases.

We are delighted that even the Post Office is conducting investigations into the implementing of improved bargaining mechanisms for negotiations between the management of the Post Office and the staff associations. That will certainly be of assistance in the sense that the staff associations will be able to bargain in future and will not simply have to accept what is offered.

It was also encouraging to note that only 25 disciplinary enquiries were held during the year, and that only two people were dismissed. I wonder if they were not ringleaders who instigated the illegal strikes last year. Perhaps, if an in-depth investigation had been ordered, there might have been more disciplinary enquiries.

I want to make an appeal to the hon the Minister, and I do so in all friendliness. Just as he said last year that he would look into the question of mixed beaches, so we want him this year to investigate the use of public telephone booths. [Interjections.] It is almost impossible at present for Whites to use public telephones because there are always hordes of Blacks queueing to use the telephone. In such cases White women meekly have to stand in line if they want to use the telephone. [Interjections.] The Government’s forced integration is becoming more intolerable by the day.

We would welcome it if telephone booths could be marked “Whites” and “non-Whites”. [Interjections.] We feel there should be separate telephones for Whites and non-Whites; and there can be grey ones for the hon members of the NP and their wives, since they want grey areas. [Interjections.]

I want to go further and put a few questions to the hon the Minister in connection with the investigation that Dr Wim de Villiers is conducting at present. We should like to know what instructions were issued to Dr De Villiers. Is his report going to be tabled? How is he going to be paid for his services? Is he going to be assisted by experts of the department? How many people are involved? And how long will it take before the report is completed?

I see in the budget that a start has been made at last on the improvements to the post offices in Carletonville and Westonaria, and I want to express my appreciation for that. I have already said that the money that is being spent in Westonaria is going to be wasted, because that post office cannot meet the needs of the people there. I want to ask the hon the Minister, therefore, to reconsider the matter before that money is spent. In view of the enormous extensions taking place there, a new post office should rather be built.

I should also like to thank the hon the Minister for adopting the standpoint that he is not going to force Posmed to become integrated. I think the hon the Minister deserves a pat on the back for that. [Interjections.] The same applies to trade unions, because the Progs want everything to become integrated, and they say so openly. [Time expired.]

Mr Chairman, if the hon member wants to bring politics into every subject on which he speaks, that is his business; but when we talk about the Post Office we should at least get our facts straight.

Correct facts, not merely facts.

Facts, yes. Hon members’ statements should at least be correct.

If they go still further and publish something, it really borders on the irresponsible. The hon member for Ventersdorp, the CP’s chief spokesman, had the following published in his party’s newspaper:

The Post Office is not being managed by the Government, but by the highly qualified gentlemen sitting over there. [Interjections.] Moreover, the Post Office was declared a virtually independent organisation years ago. It has its own profit and loss accounts and receives no allocation from the Government whatsoever. The nonsense that is being talked by that side of the Committee is merely a manifestation of the ignorance prevailing there. We are very proud of the officials of the department.

The hon member went further and said the CP was opposed to the possibility that the NP’s privatisation policy could lead to dismissals, price increases and curtailment of essential services without the White taxpayers benefitting in any way. The taxpayer per se does not benefit from this. The user of the Post Office’s services either has the advantage of decreased tariffs or the disadvantage of increased tariffs. The taxpayer has nothing to do with this, however.

Now the question of privatisation is being raised. The hon member for Carletonville also referred to the Wim de Villiers report and asked what it was about. The department is investigating this matter under the guiding hand of an inspired Mr Johan de Villiers. With the aid of the Wim de Villiers report—as far as it has already progressed—and by means of two committees, the Government is conducting an investigation into our department as a whole with a view to dividing it into components, where applicable, in order to privatise as many of these components as possible. The two committees are a technical committee, comprising senior officials and the best advisors from the private sector, and a finance committee comprising three senior officials, including a senior cost accountant from the department and three experts from the private sector, viz a managing director: finance, of a group of companies, a lawyer and a chartered accountant.

The entire investigation is being carried out in collaboration and in consultation with the department’s seven staff associations. The staff associations of the Department of Posts and Telecommunications have been fully informed on how this matter is progressing. No complaints of any nature have thus far been received from the staff associations; in fact, we enjoy their wholehearted co-operation with regard to this matter. Of course, certain staff members will be concerned about the whole privatisation idea. People—they include the CP—are reading so much into this that the officials are bound to be concerned about their pension benefits, medical aid schemes and housing benefits. The impression being created by the CP is that the Post Office is going to offer itself for sale to the highest bidder. That is not the case, however. To whom is the Post Office going to sell these components?

That is what we would like to know.

I shall tell hon members to whom. The purchasers will include the staff of the Post Office. Naturally, these components will be sold to the staff of the Post Office. [Interjections.] How will it be done? Let us take one of the components. A valuation will be done of that particular component. In other words, a value will be attached to its assets, its goodwill, its profits and to other such factors.

By the staff as well?

No, it will be done by the finance committee.

Those values will then represent shares which the staff will also be offered an opportunity to purchase. In other words, the staff will be given the opportunity of acquiring an interest in their department.

And if the staff want to sell, to whom must they sell?

They can sell it on the Stock Exchange if they wish. They will be paid dividends on those shares, and so it would be in their interests if the Post Office performed well.

The Post Office in Britain sold some of its shares to the staff with enormous success. Things will go exactly the same way for us. It will be to the benefit of the officials, because they would then become co-owners of this department. I can go on and on reassuring the staff that none of them will be worse off after privatisation than before.

I want to make a suggestion today. It is to be expected that not all the staff will be interested in acquiring shares in the privatised components, because the acquisition of shares and the paying of dividends are concepts that are unfamiliar to many people. There is a new tendency these days which companies have already applied with great success. Certain companies have worked out a formula according to which staff can share in the company’s profits. I want to suggest that when we get to this matter of privatisation—it will still take some time—the finance committee should also consider a profit-sharing formula, apart from the acquisition of shares and the paying of dividends. [Time expired.]

Mr Chairman, I wish to raise a few matters relating to staff. The one thing that concerns me particularly is that there still seems to be an entirely disproportionate ratio of White staff compared to people of other races employed in the postal services. What is of even more concern to me, is the ratio of permanent staff to casual staff employed in the various racial groups. As we know, when one is employed as a member of the permanent staff one not only has job security but one also receives certain benefits which one would not receive as merely a casual employee. I am referring to things like pension benefits.

When we look at the figures which have been given to us regarding staff employment we will see that whereas there are 48 742 Whites on the permanent staff complement and only 2 000 White casual employees, by comparison there are 5 243 Black permanent staff members and 23 452 Black casual employees.

There are, in other words, nearly five times more casual employees than permanent employees among Blacks while only l/24th of the White employees are casual employees. I would suggest that if at any given time it is necessary to employ 23 452 casual Black employees, it would surely be absolutely feasible to employ a substantial section of these people on a permanent basis over a period of time. I accept that the need for employing casuals arises from time to time, but one cannot permanently need to employ such a vast number of Black casual employees with the consequent lack of benefits which these people suffer.

I also want to refer to the question of postmen. I would have expected that by now parity would have been reached in this position in terms of employing people according to the proportions of the population in this country. However, the situation still exists in which there are approximately twice as many White postmen as there are of the other races. I am pleased to notice that parity of salaries has been achieved in this area and the situation now exists that all postmen, regardless of colour, receive the same salary.

I want to return to the question of the policy of the department as regards what appears to be preferential treatment in employing Whites over other races.

I enquired how many learner telephone electricians of the various racial groups were employed by the department and I was given the answer that there were 60 Coloured, 54 Asian, 823 White and 108 Black learner telephone electricians as at 31 December 1987. When I enquired how many electricians in each race group were presently employed—this is opposed to learner telephone electricians—the figures were equally bad. This seems to indicate that there is no improvement in this programme, because if the learners who have just joined the Post Office are still so disproportionate, we can anticipate that this uneven ratio of White over all other race groups will be maintained in years to come. I think this is most undesirable.

It really shook me when I enquired as to how many apprentices were indentured to the department and was given the answer that presently there are 67 White and no Black, Coloured or Indian apprentices. I should like to know whether there are no applications from other racial groups to become motor or diesel mechanics, painters, decorators, carpenters, welders, plumbers or panelbeaters, because in all these areas we apparently have a department which employs exclusively White apprentices. I must stress once again that if this is happening in terms of the young people we are employing today, it seems to be the policy of the hon the Minister that people of colour should not be employed. The fact that not a single apprentice from any of the other racial groups is being appointed, is indicative of what is happening. If this is not the hon the Minister’s policy, I would be very pleased to hear that. [Interjections.] I would certainly like to hear that, but it seems to me that it is not a question of a historical situation which is now being improved, but as at this present day the position is still extremely Black as far as apprentices are concerned in terms of its being extremely White.

I want to deal very briefly with one other aspect and that is the point that was raised at the Second Reading about freedom of association in medical aid schemes, staff associations and so forth.

I have no objection whatsoever to a person if he chooses to be a racist to be one within his own domain, but where we are dealing with an association which is open to the public in the Government service and people in Government service can join it, as far as I am concerned it is totally undesirable to distinguish on the grounds of race, particularly in areas such as medical aid schemes and staff associations. One must bear in mind that the three non-White medical aid schemes are all administered by the same umbrella fund. What possible reason can there therefore be for distinguishing?

Mr Chairman, the hon member for Groote Schuur devoted his entire speech to a plea for more services for Blacks in the Port Office, but as hon members of the PFP so often do, we were given a completely one-sided view, this time of the situation in the Post Office.

The Post Office makes use of many highly trained personnel. If there were a smaller supply of people from other population groups it would be reflected in the personnel position at the Post Office, but it is also true that the ratio between permanent and temporary employees in the Post Office does not, in the first place, reflect the ratio between Whites and Blacks, but rather the ratio between people who occupy higher positions and the unskilled employees of the Post Office. If the unskilled employees in the Post Office are largely Blacks, the pattern will also be that they will, to a large extent, be people who are paid weekly, the majority of whom will also happen to be Blacks.

My experience of the Post Office over the years shows that it is the one Government organisation in which colour prejudice plays almost no part, in which promotion on merit is the order of the day and in which real attempts are being made to create a better dispensation for people of other population groups as well.

I should like to return to the question of postal rates and the rates of the Post Office in general. In the Second Reading debate I referred to the necessity of ultimately taking a look at our postal rates as well. I also referred to the need to reconsider substantial discounts on bulk mail. We will have to look into these matters, particularly if one compares the postal rates in other Western countries with those in South Africa.

Two or three years ago I mentioned the discrepancy between South Africa and other Western countries with regard to postal rates. It is clear, from the latest information at our disposal, that that discrepancy has become far worse. In fact, when one looks at these figures, one realises that our postal rates have actually become ridiculously low. Our postal rate for an ordinary surface mail article of 50 grams is 16 cents. The Western country that is the closest to us in this regard—one is not talking about small countries; one is talking about Argentina, Australia, West Germany, France, Italy, Japan, Switzerland, the United Kingdom and the USA—is Argentina at 34 cents, which is more than twice our rate …

Surely it depends on the exchanges rates!

… and the Argentinian rate applies to postal articles of 10 grams— an ordinary, thin single-page letter. If one takes into account that the postal rate in West Germany is 95 cents for a letter of 50 grams, and 43 cents in the USA, one realises that if we want to run our postal system economically, we will simply have to take a serious look at our rates.

It definitely depends on the exchange rates; can the hon member deny that?

Incidentally, I want to contend that it is necessary to make our postal rates more realistic, regardless of whether it is a question of privatisation or of the maintenance of the existing system—simply for the sake of realistic postal rates. Of course, it would mean that various interest groups would be seriously affected by this. I want to mention two of them in passing. One is the postal delivery firms. The other one is political parties.

I have no doubt that the postal delivery firms will state their own case to the hon the Minister when realistic postal rates are investigated. Nevertheless, I believe it is also necessary to advance a small plea for political parties. I believe I am speaking on behalf of all political parties that are present in this House as well as in the other two Houses. Owing to the ever-increasing number of voters in constituencies, political parties are becoming more and more dependent on the services of the Post Office for the running of elections. It is necessary for political parties to make use of postal services for their postal votes as well as for their propaganda material. Unlike the postal delivery firms, which are only dependent on the postal service, political parties are becoming increasingly dependent on the telephone and telecommunications network that the Post Office makes available to them.

In our present-day life it is becoming more difficult to pay every voter a visit with a view to an election. It is becoming increasingly necessary to use the telephone network for additional work. This means, therefore, that the availability of more telephones and of more telephone facilities for parties has become extremely important. This also means, therefore, that when an increase in postal rates is justified—I have already intimated that this is my view—when telephone rates and the installation costs of telephones must be adjusted, these are all things which have a detrimental effect on political parties at election time.

Having said this, I immediately want to express my thanks to the Government for always having accommodated the parties during Parliamentary elections with regard to the installation of telephones for election purposes at a nominal fee. When I say we appreciate it, I want to say immediately that I do not believe that there is a loss involved for the Post Office because the sheer volume of election telephone calls is of such a nature that it would be a profitable transaction for the Post Office.

However, on the eve of nation-wide municipal elections—municipal elections in which, I believe, nearly 7 000 wards will be contested—the indications are that those elections are going to be as much political elections as any parliamentary election. I think I am speaking on behalf of every party in this House when I say that the costs related to postal rates, telephone rates and telephone installation, are going to become an unbearable burden for the political parties if methods are not devised to accommodate parties, as in the case of Parliamentary elections, for example. I want to contend that the same nominal rates for the installation of telephones during municipal elections be considered.

While I am asking for realistic rates for the Post Office with a view to privatisation, I am also arguing that we must investigate ways and means to accommodate political parties in the essential task that they have of giving expression to the views of the population at election time. If it is impossible for the Post Office or for any private owner of a privatised service to accommodate political parties with regard to rates, perhaps the time has come to provide political parties with direct Government assistance during elections, as is being done in the USA and in other Western countries.

Mr Chairman, I am very glad to be speaking after the hon member for Umlazi, and I wholeheartedly support his ideas on special rates during elections. Actually, I am supporting him for a different reason, which is that I do not think he has any troops left on the battlefield. His soldiers are exhausted and he can no longer fight; now he is begging for cheaper rates. Nevertheless, I should like to support him because I think it is essential that something be done about this. [Interjections.]

With reference to all the different points of criticism and then the apple-polishing on the part of the NP members, which was directed at the hon the Minister, I want to compliment the hon the Minister on the Post Office and refer specifically to the telephone services.

When one is unable to get through on the telephone because the line remains engaged, one phones again later and eventually gets through, and then has a pleasant conversation. I now want to compare this with what we are experiencing on the SA Airways. When one tries to make such a comparison one realises that no comparison is possible, because when one boards an aircraft these days, one is not sure when one is going to arrive at one’s destination. Nor is one sure what time one is going to depart.

Therefore, I prefer the Post Office, because I serve on the Standing Committee on Transport and Communications, and I am concerned about the SA Airways. I am taking the side of the chairman of the standing committee, who is also concerned about the delays on the airline.

If one looks at the Budget, one finds that it is self-evident that the hon the Minister also adopted a middle-of-the-road approach in statements such as “Ek kondig geen tariefverhogings en ook geen salarisverhogings aan nie. Pen dan ook die private sektor vas by wyse van ’n versoek om nie lone te verhoog nie.” Surely the hon the Minister simply has to adopt the same course as the hon the State President. Shortly after his introductory speech, the hon the Minister said—

Of course, the hon the Minister was speaking about privatisation here, and in turn the CP told the hon the Minister that this must be implemented judiciously.

The hon the Minister considered the metering of local calls to be very important. Once again it is a case of making the consumer pay more. It is a hidden form of rate-increase. The hon the Minister must realise that he can no longer pull the wool over the consumer’s eyes.

What about those who are still dependent on manual exchanges? What are they going to pay? I am also worried about the pensioners. In many cases the telephone is their only link with the outside world, the only way in which they can make contact with their relatives and children.

I also want to ask the hon the Minister why the Post Office had to spend R10 million on marketing costs. Was it really necessary? The Post Office provides an essential service and sells itself.

At the moment, the Post Office cannot satisfy each and every need, and is losing income as a result. I think it amounts to millions of rands every month.

Those of us on this side of the Committee want to express our concern about the items “Overtime remuneration, allowances and bonuses” on page 3 of the Estimates. If these are reduced, a possible increase of 0,5% for public servants can already be considered. This is a disturbing matter. Is it not simply a concealed method of favouring certain officials rather than others? I am merely putting the question.

On page 5 of the Estimates reference is made to “Losses”. These losses, and how they are going to be dealt with, must be given urgent attention. Nowhere can I find any indication of what procedure is being adopted to recover these losses. It is obvious who the culprits are. This is probably a case similar to that in which losses on rent revenue and on water and electricity supplies were experienced by certain local authorities, while we White taxpayers had to pay. The difference is simply that the Post Office writes off such losses, because I have never heard of anyone being taken to court. I believe that it amounts to as much as R1 million or even more per month.

What I find especially encouraging about privatisation in the Post Office is the fact that, as in the case of Eskom, Dr Wim de Villiers is investigating the restructuring of Posts and Telecommunications. However, privatisation must be carefully watched to ensure that it does not create a monopoly and push up the cost of services.

I want to mention a good example of what happens when services of the Post Office are taken over. Just look at the PABX—private automatic branch exchange—and how expensive and poor the service is. It is actually pathetic. One waits for days for faults to be fixed.

Of all the services that the Post Office provides, the postal service remains the one in which the greatest losses are suffered. This year the loss is estimated at R145 million, and the hon the Minister said in his speech that it would be made good by way of cross-subsidisation. How does the hon the Minister reconcile this philosophy with that of the hon the Minister of Transport Affairs? He believes in the opposite of cross-subsidisation. The fixed asset to liability ratio of 1,674:1 is very low; it should be at least 2:1. I think a red light is flashing for the department.

Telephone services and the handling of post are probably the primary functions of the Post Office. I want to warn the hon the Minister that if he continues to delay all the important extensions, automation and expansion of the many exchanges to save money in order to make a favourable budget and an estimated excess possible, he is going to pay for it in the long run. In the past, such budgets were disastrous and resulted in sharp tariff increases.

Harm is also being done to infrastructure. This reduction is going to result in an increase in the number of people on the waiting list for new telephone services—there are 144 000 people on the waiting list at this stage—as well as a tremendous loss of income for the Post Office.

I want to thank the hon the Minister for expanding the Middelburg exchange, and I should like to know what the costs are and whether the work is going to be completed in its entirety.

Postal delivery services are very expensive. The creation of more post office box facilities at post offices, large business complexes and residential areas will water down the uneconomic delivery services.

The surplus of R268 million, as opposed to the estimated surplus of R38 million which was budgeted for, once again reflects the manner in which the hon the Minister over-budgeted last year in order to submit a typical election budget this year. [Interjections.]

The hon the Minister should take a good, hard look at what is happening in his department. I believe he has an unofficial go-slow strike on his hands amongst members of Potwa, the Black workers’ organisation. The department is adopting a very flexible attitude. The hon the Minister must act now before it goes too far, and the SATS is a good example in this regard.

What went wrong with the post office savings accounts? Instead of an inflow of R400 million there was an outflow of R350 million. I shall tell you what is wrong. It is not the fault of the hon the Minister, but as a result of the actions of the Government of the day, the traditional investor no longer trusts the Post Office with his money. These people are now living off their savings until they eventually receive Government pensions. Then they will become a burden to the State. The hon the Minister of Finance also had a large share in this with his sudden announcement about and subsequent scaling down of the so-called “granny bonds”. I think the hon the Minister of Communications has a bone to pick with the hon the Minister of Finance.

Did we understand the hon the Minister correctly when he announced the donations to the flood disaster fund? Are all funds intended for Natal only, or are they intended for the rest of South Africa as well?

Mr Chairman, even in a completely innocuous debate such as that on the Post Office Appropriation Bill the hon member for Middelburg cannot help dragging in a lot of politics.

He has now come along once more with this old story of losses and who must pay for them, the answer being the White taxpayer. Let us say it once more—we shall go on doing so and telling the voters out there, if they believe the CP propaganda, until they understand it—that there is no such thing as a White taxpayer in South Africa. Taxation in South Africa is colour-blind. All individuals pay in accordance with their earnings. All companies pay in accordance with their earnings. [Interjections ] There is an interaction between the White workers who earn money and pay tax and Black people helping them to earn that money, and this applies in the company context too.

It is the most ridiculous thing imaginable to go around talking about “White taxpayers” in this country. On the one hand the leader of the CP says that we are a God-given diversity of people, but on the other hand they elevate one of these groups to the level of a kind of chosen people.

I do not want to talk politics; I want to come back to the departmental budget. There is something else the hon member said. He spoke about the losses. He said that we did know what the cause was, insinuating that the Black people were the cause. He spoke here about the problems experienced with Black trade unions in the Post Office. If we politicise a little old budget like this, which ought to be completely neutral and untainted by considerations of colour, we are doing the people in the Post Office a disservice.

The first thing I want to do on this occasion is express a sincere word of thanks to the Postmaster General and all his officials for the beautiful restoration work done to the buildings constituting the Western façade of Church Square, ie that portion of Church Square belonging to the Post Office.

The main Post Office building was erected in 1911, and as far back as the early thirties there was already insufficient room, and recourse was had to the Old Mutual building—which the State subsequently purchased—and the old Mint building. In the sixties the then Government decided that the whole Western façade had to be demolished and that two tall tower blocks had to be built on the Western side of Church Square to serve as a kind of gateway. The Post Office was to have had one of those two buildings on its land and it was to have accommodated the head office and all its staff.

During those years there was a great deal of opposition and vehement public reaction, and owing to a lack of funds the Post Office did not proceed with this programme. And in a certain sense it is fortunate that the Post Office did not do so. The then Postmaster General, Mr Louis Rive, subsequently expressed himself very strongly in favour of the restoration of those buildings.

In 1979 the Government eventually decided that the Western façade of Church Square should remain intact. The members of the House at the time will remember that it was a Cabinet decision which was announced. The then Minister of Public Works, the present Speaker, stood up and said that the Cabinet had already taken the decision. Thereupon a number of members representing constituencies in Pretoria put certain questions and joined the public protest for the preservation of Church Square. Ultimately the Cabinet amended its decision as a result of the many representations from many quarters.

The Post Office’s restoration work and the beautiful buildings that were erected behind the façades of the buildings they have preserved are an asset to Pretoria and to South Africa. On this occasion we want to pay tribute to both the officials of the Post Office and all the Ministers who travelled this path. For those of us living in Pretoria, and for everyone in South Africa, it is nice to know that the last phase of this reconstruction programme will be finished at the end of this month when the new post office will be put into operation. The Post Office will then have spent approximately R25 million on erecting lovely, useful facilities for itself in the interests of South Africa.

The historic significance of Church Square cannot be ignored, and we are grateful for the fact that in its enthusiasm and dedication to the ideal of restoration, the Post Office has not only erected that jewel of a building for us, but has specifically also shown us how one can, with the old building as a façade, convert the facilities behind that building into beautiful, practical facilities, such as those we can see there.

We on this side of the Committee need to state that with this restoration work, and the beautiful Post Office museum in Pretoria, the Postmaster General has made his unique contribution towards making Pretoria a city of historic significance which is worth a sightseeing tour.

I do want to recommend, however, that when hon members visit Pretoria, they should take the opportunity to see what has been done in the new Post Office building. They must take note of how the old building’s façade has been retained and how the original old building of 1911 has been restored. Then they should please visit the Post Office Museum in Pretoria too.

I just want to say a few words, too, about privatisation. On occasion I have pointed out, in this House, how many of the officials living in Pretoria are part and parcel of the public sector. In Pretoria alone there are approximately 20 000 people working for the SATS and for the Department of Communications alone. That is a tremendous number of people. Since we all know that there is great uncertainty about privatisation, let me nevertheless repeat the plea that when it comes to privatisation, including that of Post Office activities, the State should make moves to clarify the situation as soon as possible. Most important of all, however, is the fact that the officials of the Department of Communications should continually be involved in the process themselves.

When I was in my office in my constituency on Saturday morning, two young men came to visit me. I cannot mention their names here. I do, however, think it is important for us to state in this House that privatisation also has another side to it. The two young officials of the Department of Communications sat there in my office and said to me: “Sir, we work for the Post Office, we are very loyal workers and we are very happy.” The idea of privatisation, however, apparently had such an effect on them that they summarily wanted to take a portion of the work they were doing and start their own business. The appeal I want to make to the hon the Minister on this occasion is that in this overall privatisation campaign the Post Office should, in particular, take a look at the small maintenance jobs, the installation of smaller equipment and other small jobs that could allow a tremendous number of smaller businessmen, in our small and large centres, to start respectable business ventures. My request is that very serious attention be given to these smaller undertakings, because it is specifically there that we can, in the short term, enable a large number of young White and Black businessmen to conduct sound and successful undertakings. I think it is very important for us, in this overall privatisation campaign, not to lose sight of the opportunities for the small entrepreneur. The Post Office is pre-eminently suited to the privatisation of several facets of its maintenance activities.

Last but not least, Mr Chairman, I should like to associate myself with the hon member for Umlazi’s plea for assistance to political parties. The hon member for Middelburg, of course, again tried to make a political issue out of this. He submitted that it was a question of political support enjoyed by certain parties. My contention is that when we eventually reach the stage at which the State grants further assistance to political parties, those parties which are of the opinion that they have a sufficient number of footsoldiers should simply come forward and state quite openly that they do not need that assistance. Even in Britain, where that country’s post and telecommunications department is engaged in a privatisation campaign, it is an important principle of the democratic process that even today that department grants large-scale assistance to political parties during elections. I should like to put it as follows. In a country like South Africa the Government pays for democracy. The public sector, comprising large-scale businessmen, pays for democracy by way of donations to respective political parties. The individual members of the community help pay for democracy by way of their contributions to political parties. As far as I am concerned there is nothing incongruous in the idea that large bodies, even on the way towards privatisation, should increasingly make their contributions to political parties, because ultimately it is not a question of political parties as such, but of the system itself. We could learn a lesson from the USA. I am now raising this issue because I believe that the Post Office could benefit greatly from this in its run-up to privatisation. In the USA the state helps members of congress with the postage of a given number of postal items per year. We must also remember that the constituencies there are enormous. In Britain, too, the state assists parliamentarians with the dispatch of postal items to voters. I think it is of the utmost importance, and here I therefore want to link up with what the hon member for Umlazi said. I also want to lodge a very strong plea with the hon the Minister: In the preparation for and implementation of privatisation I think it is important for a department such as this to make its contribution to democracy. One of the nice ways to do so would be by extending its wonderful assistance at election time to help bona fide political parties with the dispatch of postal items.

Mr Chairman, I want to join the hon member for Innesdal in congratulating the senior members of the Post Office for the efficient manner in which they run their operation. I wish the Postmaster General happiness in his retirement and I congratulate the new Postmaster General, Mr De Villiers, on his appointment.

I also join the hon member for Hercules in the delightful comments that he made about the way in which the Post Office is run so efficiently, and therefore it is not run by the Government. That is absolutely correct. Were it run by the Government the Post Office would have been a total shambles! [Interjections.] I also want to join the hon members for Innesdal and Umlazi in appealing for assistance at the time of the municipal elections coming up in October.

What about me? I also asked that assistance be given.

The hon member for Middelburg says he also asked for this. This is done in general elections for Parliament, and an exception was made some years ago at the time of the referendum when reduced rentals were provided for the parties. I would like to ask that this be considered at the time of the municipal elections. In England all candidates are given one free post at the time of the election. I would suggest that the hon the Minister should look at this possibility and provide candidates with one free post at the time of the municipal elections as well.

With regard to this hon Minister, however, I must say he cannot resist squeezing the last drop of blood out of the stone. He told us he was not going to increase tariffs but, as I say, he just could not resist it, so he had to try to get some additional revenue from his subscribers. So as regards local telephone calls he has now announced that he is going to increase the number of metering units that are to apply for lengthy telephone calls. I would have hoped that he would have used a little finesse when approaching the problem of telephone calls. However, this is too much to expect from a Cabinet Minister of this ruling party. It would have been totally out of keeping with their record and would have been a surprise to all of us.

Many things can be said about the system of differential metering. I understand that in Australia Prime Minister Hawke lost some electoral support when he introduced a similar system. On the other hand, of course, in the United States of America it is part of their way of life. There, however, the approach that the telephone companies have towards their subscribers is completely different. Subscribers are encouraged to make use of the telephone by being charged extremely low rates for local calls. They have the differential or the extra metering system that is being proposed by the hon the Minister. They are, however, encouraged to use the telephone and they have these extremely low tariff rates for local calls. That is, however, offset by an advertising campaign to ensure that the subscribers make use of the long distance facilities offered by the telephone companies. In that way they are able to bring in extra revenue. So rather than bleed every drop of blood from the stone, I believe the hon the Minister should investigate the possibility of alternative methods of raising revenue from telephone subscribers. This should be done in a way that is fair to all and will spread the load in a more equitable way.

One of the advantages in not increasing the basic unit rate for telephone calls is that the cost of overseas calls will not increase. I hope the hon the Minister will advise us what progress is being made with regard to differential metering—I think that is the correct phrase—whereby calls made after hours are made at a lower rate as we have for internal long distance calls. There are the three rates internally. During the day one is charged the normal rate; between 6 pm and 9 pm there is a 30% discount, and between 9 pm and 7 am the next morning there is a 60% discount. I have raised this question on a number of occasions. I do believe it is important.

It applies in many overseas countries but I have been informed on previous occasions that we do not have the equipment. I would like the hon the Minister, when he responds to this debate, to explain to us what progress is being made with regard to this problem and to tell us whether we are any closer to acquiring this equipment.

There are two other matters that I wish to raise. The hon the Minister of Finance earlier this afternoon showed a little compassion and sympathy with senior citizens by allowing them to invest their money at a slightly higher rate of interest. However, I wonder why this hon Minister does not give some thought to senior citizens, as the SABC does. They provide senior citizens with licences for television viewing at reduced rates. I want to ask the hon the Minister whether he will investigate the possibility of providing the same category of senior citizens with telephones at a reduced rental and unit rate. The hon member for Groote Schuur explained during the course of the Second Reading debate that for many elderly people the telephone is the only means of communicating with their loved ones and their friends. I would suggest it would go a long way to relieving the burden for elderly people in difficult financial circumstances if some sort of concession could be made to them in terms of reduced rentals for telephones and reduced unit rates. I would ask the hon the Minister to give his attention to that matter.

The second matter is the possibility of installing computerised equipment for the savings account facility provided at counters at each post office. That is not the Beltel facility, but the savings account facility where one has a little book and goes along to the post office to either deposit or withdraw money. Building societies have this facility and anyone may deposit or withdraw money at any branch throughout South Africa. In the past the Post Office has shown its ability to make giant electronic advances and I believe it is within their capability to introduce a similar system at all post offices. There are many branches of the Post Office all over the country. There are branches in almost every suburb of every town and city. I believe it would be of advantage to savers if they could have this facility available to them. I believe it would also provide the Post Office with extra revenue by having savers use the facilities offered by the Post Office.

One final point concerning my constituency: I am pleased to say that in reply to a question the hon the Minister indicated that there are only approximately 600 applications for telephones outstanding in the Johannesburg North constituency. This in an area of something like 15 000 dwelling units, I think, is a very good record. I want to thank the Post Office very much indeed for this achievement. However, I hope we will reach the stage where telephones can be supplied on demand if at all possible. In this connection the Post Office does render a very good service and I am very pleased that this is the situation we have arrived at in Johannesburg North at this stage.

Mr Chairman, I gladly follow up on what was said by the hon member for Johannesburg North, and I should also like to associate myself with his congratulations to the department on the good work it has done. What is significant, however, is that if there is anything good to say, the hon member—probably like any typical politician—thanks the department, but in the event of anything less good, he blames the poor Minister. This will probably continue to be the case in years to come, but I nevertheless thank the hon member for the nice, friendly things he said about the department.

Today I sat listening to the opposition during this Committee Stage, and in particular to the Official Opposition. At one stage I wondered what was going on, because that opposition sounded very feeble to me. I thought it was a poor Official Opposition, but on the other hand one must concede the fact that outside the House they are doing very well, particularly in the Bushveld areas. I wondered what the reasons were, and I am certain the only reason is that this Minister’s department, down to the most junior of its officials, is one of the best organised departments we have in this country. I should like to convey my congratulations to them.

I should also like to associate myself with the representations made by the hon member for Umlazi and other hon members in connection with the holding of elections, and I am asking the hon the Minister to have this aspect investigated once more. It would probably be all to the good to bear in mind that there are quite a few political parties in this House. Some are strong and others not as strong, and for that reason this should perhaps be done on an pro rata basis if justice is to be done.

I should also like to congratulate the department on the beautiful post office being erected in Port Elizabeth. During the past three years the department has meant a tremendous amount to us in the sense that the post office, which is to be erected, has provided a very large number of jobs to people at a time when things have been difficult for us. I should like to thank the department for that.

There is quite a bit of interesting news in this information document for MPs, and I should like to emphasise the question of the National Diploma in Post Office Administration and have it on record here:

That is really a very good thing, and I trust that at a later stage this will also be extended to other centres in our country.

Another piece of interesting information relates to satisfying the demand for telephone services:

That is really a major achievement, and I trust that the Post Office will be able to take this even further.

I should now like to confine myself to a problem we are experiencing in Newton Park. The hon the Minister and the department are aware that I very seldom ask for anything, but this afternoon I really do want to ask for a few things. First and foremost I should like to express my thanks and appreciation to the Newton Park postmaster and his personnel for the very good service they furnish to the public. Newton Park is rightly called the main artery of Port Elizabeth. The truth of the matter is that 70% of Port Elizabeth’s business is conducted in Newton Park, and particularly in Greenacres. Hon members will therefore understand that the post office in Newton Park is, for the most part, a hive of activity. As a result the severe shortage of parking causes us a great deal of problems. I am swamped by complaints, specifically from the aged, and I should like to bring this to the hon the Minister’s attention. In my view the only solution is for the Post Office to purchase one of the houses in close proximity to the post office with a view to creating parking space there. Houses to the west of the post office, along Cape Avenue, are available. The problem, however, is the tremendous flow of traffic in Cape Avenue. A property at the back of the post office is ideal, and I am asking the hon the Minister, as a matter of urgency, to investigate the whole question of the parking problems we are experiencing there.

In the past I have also made representations for the erection of a post office in the Lorraine area in Port Elizabeth. The reason for this lies in the uninterrupted development projects taking place in this area. This matter is now becoming one of great urgency, however, seen against the background of the development of Fairview, which will be started in the course of this year. Fairview is a large piece of land—I think there are few cities in the world in which such a situation presents itself—a 596 hectare piece of land situated more or less in the centre of Port Elizabeth. The intention is to erect more than 6 000 dwelling units there during the next 10 to 15 years, resulting eventually in a population of more than 16 000 in that area. I have already contacted the developers of phase one of the Fairview project and they would gladly give the Post Office, free of charge, just the sort of premises the Post Office would like. If there is such a need, or if such a need were to arise in the future, I should like to help with the negotiations with a view to obtaining those premises for the department.

It is also rightly stated that the telecommunications field is a highly specialised and complex one in which rapid technological development and change is taking place. It is therefore in the national interest, and in the interests of the department, for aspiring Post Office telecommunications engineers to receive the very best training at academic institutions which can call upon the optimum degree of expertise. For this purpose an amount of R250 000 is being made available to seven universities this year. This is R100 000 more than last year. I seriously want to ask that this amount be adjusted on a regular basis in order to keep pace with the continuous and dynamic development in this field. I also look forward eagerly to the day when the University of Port Elizabeth is included in this.

I also want to thank the hon the Minister once again for the way in which the departmental pensioners are looked after. In this regard I want to quote the following passage from Information for MPs—1988, which was made available to us by the hon the Minister’s department:

Then it is stated, and this is important:

I want to reiterate that this will be high on the department’s priority list. It is necessary for some of our pensioners to retire to an area with a sea climate, and in that respect Port Elizabeth is ideal.

What about Uitenhage?

Sir, Uitenhage can have a Railway retirement village.

They are not only friendly and hospitable people, Sir; they are Nationalists too. [Time expired.]

Mr Chairman, I gladly associate myself with the previous two speakers who expressed their gratitude to the Post Office and its personnel. I think the Post Office and its personnel deserve our thanks for the work they have done during the past financial year, and hon members on this side of the House would also like to express their gratitude.

Firstly I want to refer to paragraph 1.4 of the memorandum the hon the Minister made available to us. There mention is made of an amount of R14,2 million provided as an increase in the budget in case the SATS were to announce a tariff increase of 15%. We know at this stage, of course, that there has not been a tariff increase of 15%, and there is consequently a surplus of R14,2 million available. We are therefore asking the hon the Minister what is going to be done with this money. The problem, of course, is much more serious than that. It seems as if there was no co-ordination or communication between the two relevant hon Ministers of the two departments when it came to matters such as this, or must we label this an oversight?

On page 10 of the relevant memorandum mention is made of regional services councils. I should like to know from the hon the Minister why the position cannot be changed so that no levies need to be paid to regional services councils by the Post Office. The relevant additional amount provided for new regional services councils is R1,6 million. Could this amount not be employed to much greater advantage, in the interests of the Post Office, if the Post Office were relieved of the obligation of paying levies to regional services councils?

Thirdly I should like to refer to the question of exchange rate adjustments and the relevant amounts payable. The question that immediately arises is why the Post Office has not taken out insurance against exchange-rate fluctuations as far as foreign loans are concerned. Here it is a question of the so-called “forward cover”. [Interjections.] If that had happened, it would not only have been the additional amount of R11 million for the budget for the present financial year that would have been involved, but the amounts for the 1987-88 and for the 1988-90 budget could also have been saved. [Interjections.] The question that arises, however, is what the Post Office’s total loss, let us say for the past five years, has been in regard to exchange-rate adjustments for foreign loans. It is, after all, as a result of the overall economic policy in the country that the rand’s value has decreased against foreign currencies. Surely the Government should have foreseen this and taken out insurance to cover the eventuality.

I want to devote a few more minutes to the privatisation of the Post Office. From several hon members we have heard eulogies of praise for the Post Office. If they have so much regard for the Post Office, why are they so keen to have Post Office services privatised? In this context I should like to refer to the fact that the hon members for Umhlatuzana and Hercules very clearly contradict each other. The hon member for Umhlatuzana took the hon member Mr Derby-Lewis seriously to task for having quoted such a poor example of privatisation as that of the United Kingdom. In contrast the hon member for Hercules states that the privatisation process in the United Kingdom has been an enormous success, to use his own words. I now want to know from hon members on that side of the Committee who is correct—the hon member for Umhlatuzana or the hon member for Hercules—when it comes to the privatisation process in the United Kingdom. Bet let us rather look at what the United Kingdom itself has to say about its privatisation problems. I am referring to a report that appeared in The Weekly Mail of 12-18 February. In it the reporter, Mr Graham Watts, said the following:

Now hon members must listen to what the United Kingdom itself has to say about its privatisation problems. The report goes on to state:

That is the organisation that took over the Post Office’s services—

We ask the Government very seriously to reconsider the privatisation process and the problems this could entail.

I should like to refer briefly to the three possible consequences of the privatisation of the postal services.

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

I do not have time to answer a question, Sir.

Firstly there must, of necessity, be cost increases by the organisation taking over the postal services. The argument is surely that the postal services and the Post Office are run on a business footing. If it is already being run on these lines, and is now to be taken over by a company which is also going to run it on a business footing, it is inevitable that tariff increases will result, because that company must make a profit. That will happen, unless we accept a drop in quality; that is what happened in Britain.

Secondly, when privatisation takes place only the larger companies will be able to participate, in contrast to what the hon member for Hercules indicated, because the Post Office workers did not obtain salary increases with which to purchase those shares which they would have been able to purchase. The larger companies will, of necessity, be the only ones able to participate in this privatisation process. This will encourage the formation of monopolies and a larger concentration of financial means will also be placed in the hands of a few companies in South Africa.

Thirdly, privatisation means the transfer of personnel. This problem has repeatedly been addressed. The hon the Minister of Finance has just said in his Budget speech this afternoon that the State is the largest provider of job security. If that is so, we want to ask the hon the Minister to give the Post Office personnel the assurance that their careers will not be jeopardised by privatisation. Because companies must be able to make a profit when privatisation takes place, privatisation will inevitably result in certain people being dismissed. The Post Office workers are asking the hon the Minister—in fact, in our recruiting drives in Randfontein they also asked the CP—what is going to happen to them if certain sectors of the Post Office are privatised.

What do you tell them? [Interjections.]

We tell them to vote for the CP, because the CP would not leave the workers in the lurch, as the NP envisages doing. [Interjections.]

I want to conclude, not with a warning, but by seriously asking the hon the Minister to solve the problems that could arise from privatisation before it is too late.

I want to make the following prediction: Apart from the new constitutional dispensation introduced by this Government which has been—here I am using the hon member for Hercules’s term— an “enormous” failure, privatisation will be the single biggest change brought about in South Africa; and it is going to have the same consequences as in the United Kingdom, ie it is going to be an enormous failure. The next Government, ie the CP Government, will of necessity have to save the situation again. [Interjections.]

Mr Chairman, this is the second time now that it has fallen to my lot to speak after the hon member for Losberg has spoken. [Interjections.] The question of privatisation, which he touched upon here, has repeatedly been discussed by hon members of this Committee, and it would serve no purpose for me to attempt to enlighten him any further, because he would still not understand it. [Interjections.] I think the hon the Minister will give the hon member’s questions the proper response.

Do permit me, Sir, to say a few words about the hon member’s speech and also about his previous speech in this Chamber. Posts and Telecommunications is synonymous with communication. Communication is becoming increasingly important in South Africa. It is becoming important in relations between peoples and also in the sphere of ordinary business undertakings. In recent years communication has developed into an exact science. Chairs have been instituted at various universities to give prospective students in the science the necessary instruction to achieve competence in this field.

I also want to refer to the more mundane side of communication, and I want the hon member for Losberg to listen to this. Communication is not promoted by insulting people. Communication is not promoted by the denial of the rights of people with common interests and common ties. Communication is not promoted by turning people into second-class or third-class citizens.

I do not find it strange that the hon member for Losberg is so vehemently opposed to privatisation. After all, he wants to keep these State undertakings under the State’s wing because he is a great proponent of socialism. [Interjections.]

In the CP’s propaganda in the rural areas there are signs of blatant racism.

Randfontein is not in a rural area!

Order!

It is a question of inciting hatred against certain people and of absolute racial polarisation. The CP says that the NP is alienating the Afrikaner. The fact is that the CP is alienating all other population groups from the Whites by a lack of communication or a refusal to communicate. [Interjections.] By these means they are creating a tragic future for South Africa’s young people and the children they supposedly want to protect.

Mr Chairman, on a point of order: Is the hon member entitled to dwell at such length on this question of CP policy … [Interjections.]

Order! The hon member may continue, but he will now have to come to the Bill under discussion.

I come back to physical communication. On the basis of the information document of the Department of Posts and Telecommunications, I want to speak about private radio communication.

The Post Office administers the whole spectrum of radio frequencies made available by them and utilised for private radio communication. This is administered at two levels. Firstly there is the commercial level including the citizen band radio service in South Africa, a service chiefly employed by ham-radio operators and business undertakings that all operate on the 279 megacycle band. Interestingly enough, these stations decreased by 61 326 from 1981 to 1986.

The second level is that of civil defence, which is also made possible by private radio communication, and I chiefly want to confine myself to this. This radio communication, which also makes use of the 279 megacycle band, is a matter of national importance. In the committee stage I cannot neglect, in touching upon this channel of communication, to champion the role played by civil defence in South Africa, specifically during the recent floods. The costs incurred by this organisation are chiefly borne by the provincial administration. I am speaking, in particular, of the Cape Provincial Administration, which has already contributed R1 million to divisional councils and municipalities for the maintenance and extension of the Civ D radio network. The recent flood disaster furnished proof of the action taken by civil defence via its radio communications channel. The major benefit we see illustrated in this organisation is specifically the practical usefulness of radio communications. Over the years people have contributed financially to the maintenance of this radio network, but in the course of time they grew detached, wondering why they had to make these financial sacrifices. During the flood disaster the full realisation of the value of such a communications network sank in; in fact, I am convinced that if it had not been for that network, there would have been a much greater loss of life and much more damage to property than there has proved to be. Telephone lines, roads and railway lines were repeatedly washed away, and to establish links one had to rely on radio communications. In my constituency I am thinking of places such as Douglas, Plooysburg, Modder River, Ritchie and Britstown, where the joint centres in operation established during the floods made it possible to have a proper command and control set-up through which security action could be taken.

I am aware of the cost problems in regard to this spectrum of radio frequencies, including the Post Office’s cost problems in maintaining and controlling this spectrum of frequencies, and also the investigations into interference and complaints of interference aggravated by the proliferation of radio communications channels. This leads to increasing operating expenditure. I should nevertheless like to make representations for the abolition of licence fees for Civ D radios. Those who make use of these radios already contribute financially in the sense that they purchase the equipment themselves. I am advocating the abolition of licence fees on radios for use in the Civ D network, on condition that these networks are maintained and kept in operational readiness. There must be official control by a person in charge of the Civ D organisation. He must certify that that network is being used for Civ D purposes. I am making these representations to the hon the Minister on the basis of the fact that such a radio network is in the national interest, should be maintained for considerations of security, offers effective communication over large distances and can also serve as a back-up for other services such as law and order services and the SA Defence Force. If we could do this, we would also be promoting the development of this radio network.

Before concluding, I should like to thank the hon the Minister and his staff sincerely. Allow me to refer to the Yellow Book which we MPs use and without which we really cannot manage. It is made available to us by the department free of charge. We thank the department very sincerely for this.

In 1989-90 Noupoort will also be getting an automated exchange. It is in my constituency. For that, our thanks, and our thanks, too, for the fact that in the future Douglas will possibly also be placed on the list. [Time expired.]

Mr Chairman, I wish to continue with the point I made in my speech on Monday during the Second Reading debate. I referred to the issue of membership of the various Post Office personnel associations. I raised the point that members of the various race groups have to belong to various associations, and I questioned the fact of whether this was not an extension of the whole discrimination issue based on colour.

The hon member for Primrose referred to the whole matter of freedom of association and dissociation in reply to the hon member for Groote Schuur’s point with regard to membership of the medical aid schemes. The hon member for Groote Schuur has handled that point very well today, but I would like to say that I believe that the hon the Minister would like to use the same argument that the hon member for Primrose used with regard to the membership of various personnel associations, and the fact that various personnel associations exist because of the freedom of association and dissociation. [Interjections.]

In reply to my point on Monday the hon the Minister made it clear that membership of the various associations did have historical origins as well. Regardless of the reasons given to me by hon members of the NP, I cannot accept that various personnel associations are necessary when the personnel concerned are actually involved in very similar occupations within the Post Office. I do accept—I made this point the other day—that various associations can exist for various occupations. If we take engineers, for example—I would like to take the example of the engineers again—surely it makes no difference what race group one belongs to. If one is an engineer and one is doing the work one has been trained for, surely one should then belong to the society of Post Office engineers. I believe, and this party believes generally, that it is wrong that a Black engineer, or a Coloured or Indian engineer, cannot belong to the society of Post Office engineers.

In fact, because he is of a different colour he has to belong to the association related to his race, which groups all occupations together. If discrimination is to be totally phased out of the Post Office, as the hon the Minister has indicated he would like to do, then membership open to all associations should exist, with the only determining factor as to which association one belongs to the type of work one does.

I believe there is a problem developing within the Post Office. For example, the central management committee—as I believe it is called—had to give some thought last year as to which association the first group of non-White technologists who were doing the bridging course during the course of last year, would join. I am not quite sure what conclusion this management committee came to but I am concerned that the technologists may have been forced to join the association of their race group, despite the fact that they were fully trained technologists. Therefore, they should have joined the association related to their area of work. I would like to ask the hon the Minister today to give very careful thought to this particular point if he is really determined to do away with discrimination in the Post Office. However, I would like him to know that I was very pleased with his answer with regard to meriting and that meriting in fact applies to all race groups. He assures me that this is the case. Nevertheless I would like to remind him of the point that I raised on Monday with regard to the whole merit assessment scheme within the Post Office. I believe it is a very important point and one that he should give attention to just as the Government should give attention to the meriting system within the whole of the Public Service.

On a totally different tack I would like to raise several issues with regard to post offices in my own constituency of Durban North. I would also like to say that we are well served by our post offices and by the post office personnel within Durban North. I would like to take this opportunity of thanking them for the work they do. There are, however, several issues I should like to address.

The first concerns the post office zone centre in Norfolk Place, Durban North. I have had correspondence with the hon the Minister about this before. I would like to thank him for that. This zone centre, which is unfortunately situated in the middle of a residential area and in a fairly narrow road, has caused tremendous concern to the residents around it. Because of the nature of the work carried out by this zone centre and the number of people employed there it means there is a fair amount of traffic, creating parking problems for the residents close by. This is an ongoing problem. I have taken it up with the hon the Minister previously. Former MPs for Durban North have taken it up as well, yet the problem remains unsolved. I regret to tell the hon the Minister that the matter does need attention. I am convinced that the area in front of the post office zone centre could be levelled. He has indicated to me that this is not necessarily the case; that there is in fact room for more than the three vehicles that he says would be able to park there. I would like to ask him to take the matter up and consider it very carefully.

There is also the matter of litter around this zone centre. I must stress the point that it is litter related to the post office itself. This is causing problems to the residents. The hon the Minister said he would look into this, and I ask him to do so again. I would also like to ask him whether it would not be possible to transfer many of the functions from this zone centre to the post office depot in St Andrew’s Drive which was the old Moth Hall. The zone centre in Norfolk Place is sited most unfortunately. I do have sympathy for the residents and their various complaints.

With regard to the post office in St Andrew’s Drive I wish to ask the hon the Minister whether he has any future plans for this depot, whether it is to be expanded and, if so, in what way. Rumour does have it in Durban North that the Post Office has plans for this building and I would like to know from him what these plans are. Apparently they are quite extensive.

Thirdly and finally, I want to bring up the issue of the Redhill Post Office. This has been an ongoing problem for the ratepayers in the Durban North area. I refer him to a letter, dating back to September 1986, from the then member of Parliament for Durban North, Mr Ron Miller, who assured the ratepayers that the hon the Minister would look into the matter. The problem is yet again one of inadequate parking. I do believe that this is partly a matter for the Durban City Council, but at the same time the area which could be turned into parking space does in fact belong to the Post Office and therefore I pass this point on to the hon the Minister. I ask him to look into it as well.

Mr Chairman, it is a great honour for me to support the Post Office Appropriation Bill. I should like to congratulate the hon the Minister and his officials on this Budget. This department is surely a showcase of thoroughness, financial discipline and planning. A sound foundation for privatisation has already been laid here.

I should like to emphasise a few aspects arising from the hon the Minister’s speech. Firstly, an operating surplus of R268 million is being estimated, whereas the amount budgeted for last year was R38 million. Secondly, the waiting list for telephone connections has been reduced by 23 000. That is truly an achievement. Thirdly, the department is keeping abreast of technological developments in the field of communication, except in certain rural areas. Fourthly, we welcome the decision made by this department that the tariffs for local calls will also be calculated according to the duration of a conversation. I should like to make a request to the hon the Minister to apply the same criterion to our local manual exchanges in the rural areas.

Whereas we are keeping pace with technology in our urban and certain rural areas, this is not, however, the case in all rural areas. Certain areas in the Eastern Cape with manual exchanges have up to ten subscribers on one line. In some of these districts agriculture has undergone a transformation, and the demands that we are making on the telephone services are increasing. Some farmers have up to three telephone connections on the same farming unit for the exclusive reason of limiting the number of subscribers on the line. My farm is situated in an area with a manual exchange. Sometimes I have had to wait up to two hours to get an open line.

The rural areas are confronted with the problem of de-population. Surely it is true that communication has, to a lesser extent, contributed to this in that technological developments have remained static in certain rural areas. Today I appeal to the hon the Minister to help us, since there is an expected surplus of R268 million this year. I ask the hon the Minister to help our people in the rural areas and to accelerate the automation of telephone services in the rural areas, so that we in the rural areas can also participate in the telecommunications revolution that is taking place in our country.

In conclusion I want to pay tribute to the ordinary workers in the Department of Posts and Telecommunications, namely the clerk behind the counter, the technician, the mail sorter, the postman and the switchboard operator for their contributions in making this department so effective. I gladly support this Budget.

Mr Chairman, I want to thank the hon Whip on duty for sparing me a couple of minutes to make two points.

The one point I want to make has already been dealt with by the hon member for Johannesburg North. However, I too want to add my few words here and appeal to the hon the Minister to give very serious consideration to providing some sort of financial concession to the elderly, particularly the pensioners of over 70 years old, in regard to their rental payments on telephone accounts. I would honestly appeal to the hon the Minister to give the matter serious attention.

The other matter that I want to refer to briefly is in connection with a post office that is being sought in my constituency and I wish to refer the hon the Minister to the application and the approaches that have been made in relation to the Boston post office. I know the hon the Minister has had correspondence in this regard, but I want to take this opportunity of pointing out to him that the circumstances in that area are such that very serious consideration should be given to the urgency of this matter. I would appeal to him to take the necessary steps in order to bring about the construction of a post office for the Boston area as soon as possible.

The situation has altered very considerably as a result of the train services that have been changed in that area, and this in itself is an aspect which is making things very difficult indeed for those who live there.

May I point out finally that a new post office at Boston would also serve a large section of the Black community.

Mr Chairman, I thank the hon members who participated in this debate for the contributions they made. The Management of the Post Office and I took thorough cognizance of everything that was said here, and we shall give attention to the matters which ought to be followed up.

I also want to mention that hon members on this side of the Committee replied so effectively to many points raised by hon members on the opposite side of the Committee that they made my task very much easier, but I should like to react to them in any case.

I want to point out to the hon member for Carletonville that I did not say, a few days ago, that politics should be completely excluded. I meant this should not be discussed solely as a political subject. If we have to talk politics the hon member should at least make it a little easier by talking sense, and not nonsense. That is what I was actually objecting to. [Interjections.] The hon member for Carletonville knows what I am referring to. He said that no salary increases would be granted this year but that we should wait and see what large increases were going to be granted next year.

This entire Budget and the whole inquiry we are making under the direction of Dr Wim de Villiers is aimed at identifying our weak points. We are geared to curtailing our capital investment as much as possible, reducing our operating expenditure as much as possible and making as big as profit as possible. We therefore want to be what we are, namely a profit-making company. That is the main reason for the inquiry under the direction of Dr Wim de Villiers. His terms of reference entail various things and in the first place have nothing to do with privatisation.

In the first place the inquiry is aimed at analysing the management of the Post Office and at ascertaining how the respective divisions of the Post Office should be divided into units, and how those units can be independent so that they themselves can accept responsibility for what they are doing, which is not the case at present, and how control is ultimately going to take place.

It is therefore an exercise aimed at examining the inner workings of the Post Office, just as any private company also does occasionally to see how efficient it is.

I want to emphasise that this inquiry is being supported by the departmental officials. They are playing an active role, as the hon member for Hercules said. We have appointed two task groups. The one has to enquire into finances and the financial accounts, and consists of top men from our financial department, as well as people from the private sector who are experts in this field. The other consists of engineers, with some of our best engineers in charge.

In due course we envisage involving the private sector as well in order to obtain the benefit of their expertise. Consequently this is an inquiry which we think will lead to interesting conclusions. We believe that within three months, when we hope the report will have been completed, we shall be ready to furnish further information. These particulars will be published and we will then be able to decide what course we must adopt. Let us not, at this juncture, conjure up spectres by saying that we are relinquishing assets and are going to deprive the personnel of their jobs. That is not what we want here as a contribution from hon members. Just help us to make sure that we are carrying out an expert and scientific inquiry, and that it is taking place with the full co-operation of the Post Office personnel. Already we are able to draw very interesting conclusions.

I do at least want to refer to the strikes to which the hon member for Carletonville referred. The Post Office stood firm throughout. There is no doubt about that. A total of 4 146 workers were dismissed. We re-employed 1 800 of them, whose services we considered to be essential to the Post Office, but we also employed 1 751 new workers. Consequently 578 posts were declared vacant. I may not discuss the matter, but at the moment applications have been lodged against me, as the Minister responsible for the Department of Posts and Telecommunications, in the Supreme Court, asking that the dismissed employees be reemployed. The Post Office argues, of course, that it is not essential on legal grounds to do this. The hon member must therefore know that very firm action was taken in this connection.

I have already said that Dr Wim de Villiers has wide terms of reference to enquire into the strategy, policy, control structure, organisation and also the uneconomic services. Work on the report has already reached an advanced stage, and we expect it to be completed in a few months’ time.

I want to thank the hon member for Hercules sincerely for the competent way in which and for the expertise with which he dealt with matters. He has an in-depth knowledge of what we are doing, and I thank him for giving the explanations he gave.

I just want to tell hon members that it will be impossible to reply to every point in the time at my disposal. Consequently I ask hon members to be patient. I shall gladly reply to hon members in writing if I cannot reply to them satisfactorily during the course of this discussion.

†The hon member for Groote Schuur referred to the ratio of permanent staff to casual staff. He seemed very worried about that. He also referred to the many people of colour employed as temporary staff. First of all I should perhaps give the hon member the following information. Since 1970 the White workers in the Post Office have increased by 40%, while the Coloured workers have increased by 213%, the Indian workers by 433% and the Black workers by 117%.

Are you referring to permanent staff?

I am referring to permanent and casual staff. The point I wish to make, however, is that the hon member should not generalise in this regard. I want him to have the correct information.

*Furthermore I want to inform the hon member that the unskilled category consists primarily of temporary workers. This is for the most part a fluctuating personnel group. Their service continuity is therefore broken because the services of the workers involved are utilised mainly for temporary projects, for example for the laying of cables, for telecommunications and overhead layout projects throughout the entire geographic extent of our country, as well as for seasonal requirements. Because the services of temporary workers are in many cases required only for limited times, the extent of terminations of service and the administrative obligations in that connection are of considerable magnitude.

†To organise that administratively requires an immense organisation.

*In order to involve the personnel administration board in the appointment and termination of service of large numbers of temporary personnel members, the administrative process in that respect was facilitated, and these matters are being dealt with departmentally. Temporary personnel contribute to the pension fund for temporary employees, while permanent personnel contribute to the Government Service Pension Fund. The difference is that permanent personnel qualify for retirement benefits such as a gratuities and annuities. Consequently there are very good reasons why a large component of temporary personnel are employed. This has nothing to do with race or ethnic grouping. It is a matter of the training of the employees in question.

†The hon member referred to apprentices. He mentioned that 67 Whites and no people of colour were employed as apprentices. This matter was discussed in the other two Houses. The hon member must remember he is no longer the guardian of the other population groups in the country. They can speak for themselves, and they most certainly have enquired about this. They do indeed fully appreciate the position. I exhorted them to encourage their young people to take up these types of apprenticeships. Apprenticeship, however, does not pay well. It covers a long period of time and should not be evaluated in the short term. They can obtain far more remunerative jobs than apprenticeships. The hon members of the other two Houses know this and they have undertaken to encourage their people to do this. I have offered to liaise with the hon Ministers of Education and Culture in both of the other Houses to give guidance to pupils at the various schools in order to get them to participate. There is nothing sinister in this but it is something which we hope will be put right.

As far as the various medical aid schemes are concerned, I can tell the hon member once again that those are completely independent bodies. The hon member must, however, remember that all medical schemes are finding it hard financially nowadays. I do not think the medical aid schemes catering for the other population groups will, in fact, like the idea of their members joining the other scheme because it will make life even more difficult from a financial point of view if they do.

*I want to thank the hon member for Umlazi for his very valuable contribution. He replied to quite a number of matters raised here by the hon member for Groote Schuur. The hon member also referred to the increased use of Post Office facilities by political parties during elections. I want to thank the hon member for his contribution in this connection. I also took cognizance of his observations on cheaper rates for political parties during elections. Several other hon members raised the same point, and I can assure them that we will really see what we can do in this connection. Elections these days are definitely not inexpensive any more.

The hon member for Middelburg referred to the question of overtime. We are not giving anyone preferential treatment. We render a 24-hour service seven days of the week, and overtime is inevitable. The hon member also said that losses were too high and asked whether more could not be done to recover them. If the hon member takes all the figures into consideration he will realise that the losses are only 0,65% of the total revenue. For an organisation the size of the Post Office, with people moving and so on, this is a real achievement. I am certain the hon member will understand that there is a good explanation for this. We maintain a high standard of accuracy. I want to thank the hon member, and other hon members, for their words of thanks to the Post Office.

As regards the outflow of money from the savings bank, I want to say the following. Basically it was not because people had no confidence in the Government, but because of the reduction in the interest rates on savings bank certificates. They declined from 9% to 7,5% in December 1986. However, this was in line with other financial institutions. The outflow to the granny bonds did have an effect, but not a very marked effect because a quick stop was put to them when we saw that problems were arising. I cannot reply to all the questions of the hon member, since he asked a great many of them.

As regards PABX maintenance I want to tell the hon member for Middelburg that the new regulations I will be announcing soon make provision for steps to be taken against PABX suppliers who do not render a satisfactory service. We shall monitor the situation carefully.

Reference was also made to the R10 million the Post Office is spending on marketing, but if one thinks of the scope of our operation—ours is one of the largest organisations in the country—R10 million is a small amount. We have a great deal of technical equipment which is difficult to understand but which we must nevertheless market. For example I am thinking of services such as Beltel, Telebank, Teletex and so on. I think that actually we are not spending enough on marketing, but I nevertheless take cognizance of the word of warning from the hon member.

I want to thank the hon member for Innesdal for his elucidation of the concept of “taxpayer” and what the Post Office did towards restoring the west facade of Church Square, as well as the Post Office museum. The hon member displayed a sound knowledge of the department, and we appreciate his interest.

†The hon member for Johannesburg North said that I had in effect increased tariffs by means of the new system of metering the duration of local calls. I want to tell him something about that. On the basis that average calls are of less than three minutes’ duration, there is no reason why any subscriber making normal use of the telephone system should pay more; on the contrary, this measure will eliminate most of the anomalies which currently result in overcharging.

I want to illustrate this by comparing two examples in the Western Cape. A two-unit charge is made on a call between Saldanha and Vredenburg, while in the case of Paarl and Wellington, a single unit is registered. Under the new system, a single unit will be registered for each time period in both cases. There are clear anomalies at present, and I think the business sector as well as fathers-in-law will be very pleased about this change. I do not take the hon member seriously in this regard. [Interjections.]

We would love to introduce tariff concessions for senior citizens, but this would be difficult technically and also hard to monitor. We have not yet found a solution, because such a concession could be abused, but we are looking into the position once again. We shall see whether the new technology will enable us to benefit the elderly without also benefiting the families of the elderly.

What about overseas calls?

The hon member asks me that question every year.

You have never given me the right answer.

He can read my reply to that one in Hansard. Perhaps I should tell the hon member that the position is still unchanged. The introduction of variable rates on overseas routes will only become possible once the existing international exchange is replaced.

When?

That will happen at some time in the future. We do not have the money to discard a system which works efficiently and buy a new system which would be yet another costly item of capital expenditure.

I have noted the other points raised by the hon member and will respond to them in writing.

*The hon member for Newton Park first softened up the Post Office and then asked his question. Of course we will look into it carefully. In the choice of a site the Post Office is mindful of the convenience of its clients. Sufficient provision is made for parking, and areas are equipped for the loading and off-loading of mailbags. At existing Post Offices this is sometimes problematic, and the Post Office cannot readily be expected to provide parking for the clients of other business firms, but we are taking another look at the position the hon member sketched.

I am pleased that the hon member referred to the National Diploma in Post Office Administration. I can tell him that good progress is being made.

For the sake of interest I just want to mention that during the 1986-87 financial year the Post Office paid out 5,2 million pension pay-orders to the value of R924 million. I obtained these figures from the latest available information. The Post Office therefore has a major obligation to discharge, and in general it does so very efficiently.

The hon member for Losberg referred to exchange-rate adjustments. The Post Office policy is aimed at limiting risks by means of a judicious management of exchange-rate exposures which takes the form of forward-buying of exchange. This policy has been adopted since 1 January 1980 when the cover on certain currencies made available by the Reserve Bank to public institutions was terminated.

The insurance is very expensive, but the method we are employing is not unusual for an organisation such as the Post Office. Notwithstanding the expertise which has already been built up, the telecommunications technology is so refined and complex that no country can rely solely on its own technology. We are still importing many components from abroad, and consequently we are exposed to exchange-rate fluctuations. I also want to point out that the cover of exchange-rate obligations is an extremely expensive undertaking. Consequently we apply selective cover based on expected exchange-rate movements. Furthermore, exchange forward cover is not insurance in the true sense of the word. It can be extremely expensive, particularly over longer terms.

The total profits and losses of the Post Office in respect of exchange-rate adjustments during the past five years were as follows: During 1983-84 there was a profit of R4,1 million. During 1984-85 there was a loss of R28 million. Hon members will recall that the rand depreciated considerably at the time against other foreign units. During 1985-85 there was a loss of R84 million and during 1986-87 there was a loss of R17 million. This year the loss is estimated at R22 million. We think this is a good achievement under the present fluctuations that are occurring.

The hon member must also remember that my colleague, the hon the Minister of Transport Affairs, and I consult regularly on this matter. In the past the SATS has granted the Post Office lower rates, but this is systematically being phased out. Consequently we must budget for higher rates in any event. If over-budgeting occurs, the position will be rectified later this year in the revised Budget.

As regards the payment of levies to regional services councils I just want to mention that the Post Office has for years been paying tax for services rendered by local authorities. It goes without saying that the Post Office pays these levies as well.

The hon member for De Aar referred to the value of radio communications which the Post Office maintained during the floods. He requested that licence fees for Civ D radios be abolished, since this would be in the national interest. We shall go into his request. There are considerable implications involved which will affect other departments as well. However I appreciate the hon member’s view since I also come from the rural areas. We shall investigate the matter very carefully.

The hon member for Durban North referred to staff associations. The hon member for Durban North must take note that there are seven different associations. The Post Office does not prescribe to the staff associations which groups they may represent. The only condition is that an association must have at least 50% of the personnel of the work group it represents as registered members. Every association has its own constitution, which may only be amended by a general meeting of its members, and the Post Office has no say over that. This implies a choice and the hon member ought to support that concept. It is a choice which the individual and the group decided to make. The associations receive no financial or other support from the department, and are completely autonomous.

†The Society of Post Office Engineers, for example, represents engineers and technologists of all race groups. This arrangement was agreed to by the Post Office at the request of that association and with the consent of the other affected staff organizations.

The hon member also referred to the merit system. The merit system has developed over many years with the assistance of the various staff associations and to their entire satisfaction.

*I also sincerely want to thank the hon member for Albany. I agree with him in regard to the manual exchanges; one does find it a little more difficult than normal. However, the manual exchanges also have so many advantages. On my farm we are served by a manual exchange. If I want to speak to my son on the farm the telephone operator tells me precisely who he is visiting that night, or which young lady he is calling on! A tradition has been built up around this, and it has become part of the culture of the rural areas. However, I took cognizance of what he said. The hon member said that the R268 million which we have budgeted for the new financial year should be utilised for that purpose. We are not going to use any surplus for capital expenditure, but we shall first have to give careful consideration to the priorities. These cases will, of course, be considered as well. I thank the hon member for the tribute he paid to the personnel of the Post Office.

†I have a lot of sympathy for the hon member for Mooi River’s reference to pensioners and I will write the hon member a letter in this regard, which will set out the surrounding circumstances. Perhaps we can have a personal discussion in this regard too. I have noted the particular circumstances of the post office at Boston, to which the hon member referred. The department will look into it.

Schedule, Clauses and Title agreed to.

House Resumed:

Bill reported without amendment.

Third Reading

Mr Chairman, I move subject to Standing Order No 52:

Mr Chairman, it is a pleasure for me to conclude the debate on behalf of the Official Opposition.

In the first place, I want to refer to the speech made by the hon member for Boksburg, and in passing to the speech made by the temporary hon member for Hercules as well.

The hon member for Boksburg very definitely suffers from an AWB syndrome, because without it he would not have known what to speak about and would consequently not have had a speech. It is very clear that the hon member for Boksburg has the AWB on the brain. I think he knows what the reason for that is. He is anxious and afraid; he is scared and worried because he knows that Afrikaner nationalism is a threat to the path of integration that he is walking with the NP. [Interjections.]

The hon member said in his speech that I only thought about the White Post Office officials. That is of course untrue. People who live in glass houses should not throw stones. The hon member for Boksburg sees the mote in another’s eye but not the beam in his own. He said I only thanked White Post Office officials, and I am telling him he would do well to go and read my speech. He would see that I thanked the Postmasters General, the Deputy Postmaster General and the Post Office staff. What I did in fact do—I am not prepared to apologise for that—was to express the Official Opposition’s thanks to White Post Office workers, in particular, who displayed a responsible attitude by not striking. I thanked the White Post Office workers because they were prepared to do the work of the Black Post Office workers when they went on strike. I thanked them because they stood by the department when it was faced by a crisis and needed help. On that basis the temporary hon member for Hercules said—this hon member was rejected on 6 May 1987 by the majority of his electorate …

Mr Chairman, on a point of order: Is the hon member entitled to refer to the hon member for Hercules as the temporary hon member for Hercules?

Order! It is permissible, but serves no real purpose. Any hon member may say that to another hon member; it really has no significance. I do, however, want to draw the hon member’s attention to the fact that he should deal more specifically with the Third Reading of the Bill.

I shall do so, Sir.

Surely it is a well-known fact that on the 6th of May, 1987, the hon member for Hercules was rejected by the majority of Post Office workers in his constituency. That hon member said, in the Second Reading debate, that my speech was racist. I want to make it very clear, however, that I was elected by the White voters of the Ventersdorp constituency with the instruction to come and take charge of their interests here. I was elected by Whites and I shall protect their interests here with every means at my disposal. I have an obligation to my White voters and I shall discharge that obligation. The hon member for Hercules will not cause me to see things in a different light.

Just leave my White voters alone.

I have taken this opportunity to thank the White Post Office workers because they supported the department in a crisis situation. [Interjections.] If the hon member for Hercules wants to call me a racist for this reason and wants to describe my speech as being racist, he must go ahead and do so, for then I would rather be a racist than a member of the NP. Not one NP speaker thanked the White Post Office workers, in particular, for their voluntary sacrifices, their zeal and loyalty to the Post Office which they demonstrated during the strike. [Interjections.] No, Sir, those hon members did not do so because they are ashamed to thank the White Post Office workers. They have become ashamed to thank and praise their own people, but when we in the Official Opposition do so, we are labelled racists.

Who is talking about racism? Who made MPs and Ministers out of the Coloureds. The NP Government did that. They were made first-class MPs and first-class Ministers, but when they wanted to swim, they had to swim second-class. Who is talking about racism? Who is discriminating now?

Let us see what else the hon member for Boksburg had to say. Let us look at the kind of guilt-ridden untruth about the Post Office workers that he noises abroad …[Interjections.] What kind of damnable lie does he noise abroad?

Mr Chairman, on a point of order: May the hon member say that the hon member for Boksburg noises a lie abroad?

Order! The hon member must withdraw the word “lie”.

I withdraw the word “lie”, Sir.

The hon member said in his speech that we had kept quiet about the fact that every official was going to receive a notch increase. He said that no one on this side of the House had said anything about that, but in Press statements we had said that those officials were having a hard time of it. That hon member said every official was going to receive a notch increase. He said it, knowing it was not the truth.

Order! No, the hon member cannot say that either. He must withdraw that as well.

I withdraw it, Mr Chairman.

Surely that is not true, because surely not all Post Office officials received notch increases, nor is everyone going to receive one. The hon member for Boksburg ought to know that. Yes, the hon the Minister must have a little talk with the hon member for Boksburg because he tried to mislead the Post Office officials in this way or because he had, perhaps, not done his homework. [Interjections.]

The hon the Minister also heard what the hon member for Boksburg said during the Second Reading debate. The hon the Minister heard the hon member for Boksburg saying that every official was going to receive a notch increase. Surely the hon member knew that that statement was incorrect, yet he did not consider it sufficiently important to correct that hon member, or had the hon the Minister perhaps not done his homework either?

Let us see what the true facts are. The fact of the matter is that 37 562 Post Office workers are on their maximum notch. That represents 39,4% of the total Post Office staff. [Interjections.]

I see that the hon the Minister is so uninterested in this debate that he is not even in the House.

He is here!

At present, 39,4% of the Post Office officials are on their maximum notch and are therefore not receiving any notch increase whatsoever, not a single cent. That is not all there is to it. There are a further 390 Post Office officials who are appointed at a fixed salary and therefore cannot receive any notch increases. A total of 37 952 or 39,8%—yes, almost 40%—of the total number of Post Office officials are not receiving any notch increases. That is the way the hon member for Boksburg relates to the truth. That is how he tries to mislead and placate Post Office officials with a representation. That is the thanks the White Post Office official gets from the NP Government, because the majority of the 37 952 Post Office officials who are not going to receive any notch increases, are Whites.

Now whose statement is untrue? The hon member for Boksburg was all bravado during his speech in the Second Reading debate. In characteristic NP fashion, with an attitude typical of them, he tried to humiliate the Official Opposition’s speakers by this misrepresentation.

I want to know from the hon the Minister whether he is now prepared—and I ask him this in his absence, because I note that he is still not here … I apologise; I see he is here after all. I therefore want to know from the hon the Minister whether he is now prepared to repudiate the hon member for Boksburg. I note the hon the Minister is beginning to jump around nervously. He is flitting from bench to bench. I want to know whether the hon the Minister agrees with the statement made by the hon member for Boksburg. I want to know whether the hon the Minister agrees with the statement that almost 40% of all Post Office officials are not going to receive any increases at all, not even a notch. The fact of the matter is therefore that the Post Office officials are not going to receive any general increase and that almost 40% of all Post Office officials are not even going to receive a notch. [Interjections.]

Mr Chairman, on a point of order: Could you please give the hon member an opportunity to complete his speech.

Order! I want to tell the hon member that provocation is taking place on both sides. That makes things very difficult for the Chair, but I note that the spirit is not too bad. I want to ask hon members not to shout the hon member down so vociferously. The hon member may proceed.

The NP Government has no sympathy with these Post Office officials, because they are expected to tighten their belts even more.

Let us take a look at what is happening to the man in the street, because it seems to me the hon the Minister has become completely insensitive to the reality the Post Office official has to deal with. Let us take a look at what the director of the Consumer Council, Mr Jan Cronje, has to say about this. In a report in yesterday’s Die Burger he said:

Mr Chairman, may I ask the hon member a question?

No, Sir, I do not have time to answer any questions now.

Price increases which are disproportionate to the rate of inflation, are still a widespread phenomenon occurring daily, price increases such as those on milk, food and car tyres which closely affect the Post Office official. The NP expects of the Post Office worker to tighten his belt, even though the prices of essential foodstuffs are increasing daily. The Post Office official is not receiving any general increase and almost 40% are not even receiving a notch increase, yet they are expected to tighten their belts, and why? Because the Government allowed the inflation rate to soar and because they did not control Government spending. Unfortunately my time has now expired.

Mr Chairman, the hon member for Ventersdorp still has a lot to learn. The first thing I think he ought to learn is that it is permissible for an hon Minister who has been sitting in this House the entire afternoon, to leave the Chamber occasionally for a minute or two. I want to tell the hon member that when the hon the Minister leaves the Chamber, he usually listens outside the chamber to what is going on here, and he knows what hon members are saying. Consequently it is not necessary for an hon member to make such derogatory remarks to an hon Minister.

Rather tell us about your untruths.

The hon member for Brakpan is a senior member, and I expect him to inform that hon member about these finer aspects of Parliamentary procedure instead of leading this young member along this path of folly, encouraging him to indulge in gossip-mongering here and make himself look ridiculous. [Interjections.]

Firstly I want to come back to what the hon member for Carletonville said. He stated that there were no Blacks planting poles in my constituency. I want to ask him, when holes are being dug in his backyard, what machine he is going to use to do it. [Interjections.] For years the hon member was general secretary of the Workers’ Union, and he really does not know what those workers do. [Interjections.] He does not know that it would not be easy for him to get that machine into his backyard, nor does he know that many people will not allow him to use a machine there, because one is not going to allow that garden to be ruined. The Post Office poles are planted there; not on the sidewalk, but in the backyard. That is where they are being planted. [Interjections.]

Order! I think the hon member for Carletonville could agitate a little less loudly. The hon member for Boksburg may proceed.

Next time the hon member for Ventersdorp should concentrate on not withdrawing something he said and ought not to have said, but rather on withdrawing his entire speech. The last part of his speech, in which he referred to what Mr Jan Cronjé said, had nothing to do with the Post Office. What has the price of milk got to do with the Post Office? [Interjections.]

Tell that to the officials out there!

That is what the hon member is unable to understand. That is why the hon the State President asked other sectors as well to look into the situation. The State is looking into its situation … [Interjections.]

Order! The hon member for Ventersdorp has had his turn to speak. His monologue is not going to be allowed.

In this debate we are considering the budget before us. I do not want to be too tough on the hon member. He imputed all kinds of things to me here. Unfortunately I do not have the statistics on how many of the officials are on their maximum notch. I should like to know where he got hold of the figures and whether they are correct.

They are quite correct!

It still amounts to the officials having come to an agreement with the Post Office. He said he would work in the vineyards at a certain salary scale. If he has reached the maximum notch, he knows he has reached his maximum salary. He is still working in the vineyards and has to accept what he agreed to.

[Inaudible.]

Order! If the hon member for Ventersdorp does not heed the appeal I made to him, I am going to expect him to withdraw from the Chamber.

Thank you, Mr Chairman.

You said all the Post Office workers had received increases.

The hon member for Brakpan could also give me a chance.

Order! The hon member for Brakpan must also give the hon member a chance.

The hon member for Ventersdorp has had two days in which to speak. One would have expected him to tell us how he was going to manage and control a post office in a “Boerevolkstaat”. I want to tell him that the first thing that will happen to his “Boerevolkstaat” post office is that it will be kicked out of the Postal Union and that there will be no contact with his “Boerevolkstaat”. [Interjections.]

Order! Perhaps the hon member could also discuss matters dealing more specifically with the Third Reading of the Bill.

I am dealing with the Postal Union, Sir, but I am returning to the fact that this budget makes provision for those things. If you had not drawn me away from political issues, Sir, one could have had a nice chat about what the CP should have done and how they were supposed to tell us how they were going to control the post office in that national state of theirs, and how they would remain in contact with the telecommunications systems, postal systems, etc, of the neighbouring states. [Interjections.] One can just see them returning to the time when they ran about with five envelopes in a cleft stick. [Interjections.] Now I want to ask them what the colour of the man who will have to carry the little stick will be. They will continue to have a problem in their state. I think the hon members just want to get to their stage-coach, Sir, because all they want to do is shoot …

Order! No, if the hon member continues in that vein I am going to ask him to resume his seat.

I am coming back to the Third Reading, Sir.

Mr Chairman, on a point of order: Is the hon member entitled to say that all the CP wants to do is shoot?

Order! I think I shall let it pass. The hon member may proceed.

At the Third Reading stage one wants to review what this Budget entails in terms of the future of the Post Office, the staff serving in it, the consumers, the suppliers, and in terms of the economy in general. Firstly we believe that we must take a look at the Post Office itself. In this budget, for example, sufficient provision has been made for the proper marketing of the Post Office. Earlier this afternoon I heard the hon member for Middelburg referring to this. If we have not made proper provision for that in this budget, it will not be easy for us to provide the Post Office with its refined systems. One is therefore thankful for the additional amounts which have been appropriated to enable the Post Office to publicise these new systems. If we do not publicise them, we cannot make a survey of how great the demand for these refined systems will be. Consequently I think that this budget makes provision for that and helps us in that in future we shall be in an even better position to plan the promotion of the Post Office and its new systems.

This budget makes provision for the creation of business units and for the transformation of the Post Office into a business-orientated organisation. The evolutionary process, in which the State will be released from functions in which it is not supposed to be involved, is therefore proceeding.

There was a time in the history of the Post Office when the post was delivered by field-cornets and when the stationmaster and the postmaster were one and the same person. This budget is therefore continuing the evolution which has taken place in the Post Office in South Africa, and eventually we shall establish whether we might not be able to privatise it. Enough has been said about that in this debate.

In passing I want to refer to the fact that when the Post Office was originally established in South Africa, the people were almost unable to get hold of their post. The local inhabitants in this region heard by chance from ships’ crews what was happening in their home country. We have come a long way since then. These days, thanks to electronic systems, one can communicate immediately with the inhabitants of the countries from which the Whites came.

This budget will also ensure the better diffusion of information, and we are in fact living in times characterised by an information explosion. I believe sufficient provision has been made for us to be able to proceed with this.

Not a single speaker in this debate referred to the extremely important role that the telephone played in Bophuthatswana to prevent that country’s government being brought to a fall. It was only the good network that exists here that prevented a lawful government being replaced by an unlawful one. We must thank the Post Office and its officials for that as well.

The hon member for Primrose indicated that the network’s income was going to be greater, and I believe we dealt with this in this budget. If we do not spend, we are not going to generate income either, and therefore we have made proper provision for that. The Budget provides for our growth occurring at a realistic rate. The ability of the consumer to pay for every service he requests is taken into account here. We have realised that if the demand is too great, and the people cannot pay, we are spending money unnecessarily. This Budget has dealt with that problem.

I believe this Budget will also contribute to the stimulation of industry and agriculture. We have heard of many farmers who are thankful that the telephone lines in their areas work well, and I believe that that will improve the economy of every region in this country.

I advocate and believe that those who at a later stage will give attention to privatisation, will do so in such a way that the role the Post Office plays in all these sectors will be augmented.

I want to say a few words about how the Budget will affect the personnel. Despite what the hon member for Ventersdorp said, no employee will be any worse off, receive a smaller housing subsidy or bonus or be paid less for overtime. The balance between this department and other Government bodies is being maintained, and as the hon the State President said, we hope that this year the private sector is also going to play its part. This Budget makes provision for our being able to help our people.

Another example I want to mention is that one out of every five telephones in the White areas is used by the informal sector. According to a recent report, one out of every five Whites is not involved in the formal sector, but in the informal sector.

Business suspended at 18h30 and resumed at 20h00.

Evening Sitting

Mr Chairman, before business was suspended for dinner I was indicating what effect this Budget would have on the economy in general. At that stage I said that one out of every five White breadwinners was involved in the informal sector, and I also said that about 80% of the White breadwinners had telephones. That indicates the extent to which this department’s budget will help to promote the informal sector when it comes to enhancing the well-being of people who run their own businesses on their own initiative. Just think of the musician, the plumber, the honey-farmer, the music-teacher, the sports coach and the owner of a gym or a centre for aerobic exercises. There are so many of them.

I also want to say that the consumer will eventually benefit from this Budget. The consumer eventually has a bigger market with which he can make contact. We have heard how many countries will now be involved in this expanded network. Therefore there will be greater scope for their markets.

Furthermore I want to say that even the supplier will have to take cognisance of this Budget because we ourselves have sent a signal to them to say that we cannot seriously proceed with the expansion of the networks, and that once again we shall have to join forces and stop for a while to consider what services we should concentrate on.

Yesterday an hon member spoke about telefax services. That merely proves how we can also increase the productivity of the private sector. Just think about agriculture, mining and other spheres of the private sector.

The effective way in which this department has been working and in which it will carry on working is an inherent part of this Budget. This Budget can only improve the situation for us.

I want to conclude by saying that even as far as the training of personnel is concerned, ample provision has been made for the members of every group. A person will benefit from this Budget, regardless of what race he belongs to, what religion he professes, what political party he belongs to or which language he speaks.

Finally, I want to say, as I did years ago on the retirement of the then Postmaster General, Mr Louis Rive, that we also want to tell the present Postmaster General who is now retiring that he continues to inspire the Post Office to greater heights.

Mr Chairman, I will not keep you for very long, but I do have a few matters to get off my chest.

First of all I must refer to a telephone conversation which I had this afternoon. Somebody obviously realised that I was one of the spokesmen on this particular department, and had something on his mind and phoned me. This was from a gentleman in Natal who is a telecom electrician. He informs me that he has reached the supervisor grade. He tells me that in terms of a staff code he as a supervisor cannot hold a position where he has to supervise White employees. I would like the hon the Minister to tell me whether this is the case or not.

Order! Just one moment, please. I have great difficulty in following the hon member. I would be pleased if hon members would lower the tone of their voices. The hon member may continue.

Mr Chairman, I was saying before the interruption that this gentleman informs me—and I do not know whether this is correct or not—that in terms of some sort of staff code he, as an Indian telecom electrician who has risen to a supervisory grade, is in fact not allowed to hold a position where Whites fall under his supervision.

White staff members apparently rely on this code, or whatever it is—he referred to it as a staff code—and object when somebody of colour rises to the supervisory grade. As a result, people who have risen to a level on which they supervise White people are actually being transferred to other post offices. He said that this had led to the staffing of post offices in Natal having become very racial. Post offices are apparently staffed mainly by Indians in certain areas and mainly by Whites in others, so as to avoid a situation in which White staff members object to having supervisors of colour.

I am merely conveying to the hon the Minister what I was told on the telephone this afternoon. The person I spoke to was employed by his department, and I am concerned about the matter. I have not had an opportunity to check the facts, and so I would simply like to ask whether this is or is not happening. If there is such a staff code, or if the department is pandering to the particular racial tastes of people who do not want to be supervised by someone of colour, I appeal to the hon the Minister to do something about it. I would like to think that the department would want such a practice to stop.

There are one or two other things I am concerned about. I understand that the department has recently purchased a piece of land in Johannesburg for the erection of a postal sorting house, and that they will be taking transfer of the site at a cost of R15 749 085 during April this year. I have no objection to the acquisition of this land or the price, as I understand that such a facility is needed in the centre of Johannesburg for a number of reasons, among them bulk posting. I am concerned, however, at the fact that it is anticipated that the building which is to be erected at a cost of approximately R100 million will only be functional in 1992 or 1993, that is in four or five years. I have also been informed that planning is already in an advanced stage.

If the land has been acquired and planning is in an advanced stage, we should be able to call for tenders by the end of this year, other things being equal. I have discussed this with people who know something about the building industry, and I cannot understand why there should be such an enormous delay in erecting the building. It may be a question of financial constraints in that the department may not have been voted sufficient funds for the erection of the building.

It is also my experience that when somebody states a projected date of completion, for instance 1993, one can be mighty sure the actual date will be a year or two later.

I am very concerned, if the problem is the availability of funds for the erection of this building, that we are being very short-sighted. Perhaps the department is constrained by the fact that we cannot vote the necessary funds to erect the building over the normal period of time. Perhaps they have therefore decided to invest R15 million in April this year, and sit on that unproductive capital investment for five years, investing further money in stages of the building process. I think this would be a very wrong thing to do.

There is one other thing which causes me concern. I believe there is the possibility of a second cable being laid between South Africa and Europe. Now, I believe the anticipated cost of this cable will be approximately R800 million. One of the primary reasons why this cable is being considered is because of the political situation in this country. The possibility of international isolation through the blockage of satellite communication or the sabotage of the existing cable will apparently be a major consideration in deciding whether or not to lay the second cable. It just bothers me somewhat that we should have to incur the expense of R800 million for laying a second cable if one of the primary reasons for doing so is attributable to the political mess, in terms of our international standing, into which this Government has got us. It seems a great pity that we should have to pay this sort of price to avoid international isolation because of Government policies. [Interjections.]

Mr Chairman, I am going to leave it to the hon the Minister to deal with that hon member later. While I was listening to the beginning of his argument, I wondered whether those hon members realised that their obsession with integration, willy-nilly, at all levels, is just another form of racism. One could regard it as racism by apology. That is the problem hon members in that party have. [Interjections.] In introducing this Appropriation Bill, the hon the Minister also gave attention to the Post Office Savings Bank. He expressed his department’s attitude to this bank as follows:

This evening I want to avail myself of this opportunity to associate myself with this point of view in respect of the savings bank. I therefore want to present a few important aspects to this House to motivate the standpoint of the hon the Minister.

For the sake of historical perspective, it is interesting to note that the Post Office is one of the oldest savings institutions in South Africa. It has always been a fact that development costs money. If a community saves and spends sensibly in times of prosperity, it ensures its continued progress and prosperity. Lord Charles Somerset realised the truth of this, and tried to establish a savings bank in the Cape as far back as 1822— successfully, as it happens. Soon afterwards, in 1884, the first Post Office Savings Bank was established. Today, 104 years later, the Post Office Savings Bank as an institution is still with us.

The Post Office’s savings incentive schemes in schools have been part of many children’s education for decades. That includes me. At the same time its savings bank certificates, with tax-free dividends, offer a welcome opportunity to many affluent portfolios. Apart from the savings bank certificates, the Post Office Savings Bank also offers the normal current savings book account, as well as the current electronic savings account, known as Telebank. The interest rates on the latter two kinds of account are 5%, whilst investments in the savings certificate account at present earn 7,5% interest. The facilities of the Post Office Savings Bank are made available to clients by way of 1 740 branches country-wide, even in the smallest and remotest places in the Bushveld.

Furthermore, it is interesting to note that the Post Office Savings Bank not only operates all Post Office accounts in South Africa, but also in Transkei, Bophuthatswana, Venda and Ciskei. To further popularise the savings services, the period of withdrawal was reduced from a withdrawal of R200 every fourth day to R200 per day, and the amount of R200 was increased to R300 per day from October last year. It is also true that Post Office savings accounts have shown a growth of 6,3% for 1986-87, and 7,6% until 31 December 1987. On the latter date there were 7 003 722 such accounts. The average balance per current account is R204. The Post Office Savings Bank is therefore notably the bank for the smaller investor. It is the small man’s bank. This small man’s bank did not always fall under the Post Office, however, but was initially managed by the Postal Services on behalf of the Treasury. From 1 April 1974, however, it has been run by the Post Office for its own account.

The main consideration which led to the transfer of the Post Office Savings Bank to the Post Office can be summed up as the expectation that due to the increased motivation of the Post Office and its staff to develop the bank, considerable additional finance would be attracted to the bank and would then be available for investment, particularly in the extension of the telecommunications system. This, in turn, would alleviate the pressure on other sources of capital for investment in the essential public infrastructure mentioned. This expectation was, in fact, fully realised in practice, with the support of the Department of Finance and the Post Office Savings Bank, as far as interest rates were concerned.

Whereas the balance in the Post Office Savings Bank amounted to R252,7 million when the Post Office Savings Bank was taken over by the Post Office, up to the end of last year it grew to an amount of R3,356 billion by way of an average growth of approximately R239 million per annum.

At the end of the previous financial year, R2,322 billion in Savings Bank funds had been invested in the telecommunications system. The small man’s bank, and in particular the income derived from it, is therefore helping to run the posts and telecommunications services.

†In every paradise, however, there is a serpent. On 15 December 1986 the interest on savings certificates had to be decreased from 9% to 7,5%. This contributed to an outflow of funds during the course of last year, totalling R779 million. At face value an interest rate of 7,5% may not seem very attractive. It should be borne in mind, however, that any investment must be judged by its final value in terms of a total package. If, for example, a man earns more than R60 000 a year and pays 45% tax, an investment in savings certificates will, because it is taxfree, offer him an effective interest of 13,6%.

Unfortunately it is a fact that the Post Office can hardly increase its interest rate without an increase in tariffs as well. That would give inflation a further boost.

A further factor, however, which spoiled things in this savings paradise was—as was to be expected—Eve. Admittedly, it was not the traditional enticing blonde, with or without the proverbial figleaf, which we men conjure up in our mind’s eye when we think about Eve. No, Sir, in this instance she was a prim and proper granny— and wide awake. She went for the granny bonds in Barend’s paradise.

As a result of these factors there was between January and October last year a drain on funds averaging R35 million a month. Since November, however, this changed into a moderate inflow of capital.

*I now want to deal with the hon member for Ventersdorp for a moment. I quote from the latest Patriot—it is still hot from the press—in which the hon member says:

In view of what I have just explained, this is a tremendous and I fear a deliberate, oversimplification. I want to assure hon members on that side that criticism is welcomed, but we must do so from a slightly broader and more objective perspective, and not just for the sake of such obvious politicking.

Since I am on this level now, I want to address the hon member for Losberg for a moment. Earlier this evening he claimed that I was supposed to have said that the privatisation of telecommunications services in the United Kingdom was being effected at a loss, whilst the hon member for Hercules claimed the opposite. I was reacting to the hon member Mr Derby-Lewis in the second reading debate. He said that the privatised telecommunications services were functioning at a loss, and that a lesson was to be learned from that. My argument was merely that if that was the case, it did not mean that we had to fail in the same way in South Africa.

You said the United Kingdom was a poor example.

It is a poor example. I said that it was not an example which we would hold up as an ideal for ourselves. That is what I said. There is no disparity between my standpoint in that regard and the standpoint of the hon member. In the 13 years since the Post Office took over the Post Office Savings Bank from the Treasury, to run it for its own account, there has in fact not yet been a net outflow of funds. The duration and extent of the present outflow to which the hon member referred, and on the other hand the fact that since the take-over of the Post Office Savings Bank there have from time to time been complaints from the private sector that the Post Office is an unfair competitor, in fact compels one to decide on the role of the Post Office Savings Bank in the national economy, as well as its future position in Post Office financing.

From the point of view of public financial policy, there are two considerations in particular which should be taken into account in any rethink on the Post Office Savings Bank’s right to exist and its future role. Firstly—in my opinion this is very important—there is the social role which the Post Office Savings Bank fulfils. Apart from objectives such as promoting thrift, which was one of the original reasons for establishing the bank, the Post Office Savings Bank is pre-eminently the small man’s bank, available to him in the remotest corners of this country. This facility is readily available in places where, and to people to whom, private sector facilities are not readily available. Furthermore, the running of the Post Office Savings Bank also serves, to an important extent, to support the maintenance of a large number of branches of the Post Office, where other financial services such as the payment of pensions can be offered. In conjunction with the Post Office Savings Bank, the availability of these other facilities is of considerable social importance.

We therefore also have a duty towards the old man who arrives at the post office on his bicycle to come and bank his odd rand or two. We are also familiar with the Black man who arrives at any post office on shanks’s pony. He has no fixed address, but he has his post office book in his pocket and he is coming to draw money for the weekend.

The second consideration which should be taken into account, from the point of view of public financial policy, is the difference between the nature and aim of the Post Office Savings Bank and that of the institutions in the private sector with which it supposedly competes. The name “saving bank” in this case is purely for convenience. It does not conduct the traditional business of a bank, but is merely a method of obtaining funds to extend the capital of the Post Office. Apart from that, the various activities of the savings service of the postal services is aimed at only approximately 3% of the domestic money market. It is therefore not a real threat to the banking establishment as such.

Seen in perspective, the Post Office Savings Bank is just part of the package whereby, in a wider context, the State specifically participates in the savings activities of individuals on a regular basis and uses such savings for the purposes of public capital. This is an acceptable, sound principle. Since there has been talk of the privatisation of posts and telecommunications, the privatisation of the Post Office Savings Bank would merely create another bank, and there is really no pressing need for this.

On the other hand, the man in the street does in fact need the cheap overall service he is getting from the Post Office Savings Bank at present. In fact, at present there are more than 7 million such savings accounts, although some of them are dormant at the moment. In view of the above-mentioned services, as well as their usefulness to the State, I want to make a plea that serious consideration be given to retaining this institution, even if the Post Office Savings Bank has to be separated from a privatised posts and telecommunications service and again fall under the Treasury.

Mr Chairman, at the conclusion of this debate, it is now my privilege to rise and reply. I just want to refer to the Official Opposition in regard to a few matters. I want to state unequivocally that in my career in this Parliament I have never encountered such unreasonable behaviour in a Parliamentary representative as in the hon member for Ventersdorp during the Second Reading and Third Reading debates.

This backbencher, the hon member for Ventersdorp, is in fact full of self-confidence; but the question that arises is why he is so full of selfconfidence.

Because he defeated a Deputy Minister!

It is not the style of the hon the Leader of the Official Opposition, the hon member for Barberton and the hon member for Brakpan to behave like that. The hon member for Ventersdorp, however, bombastically kept on adopting uninformed standpoints. Every hon member present here must clearly be able to see that he knows absolutely nothing about the subject we are debating. [Interjections.] This is really cause for concern, but I do not even want to discuss the subject any further with him.

Mention was made of the Black workers who went on strike. There were approximately 16 000 Black workers who went on strike. There is a Black labour force of 30 000 in the Post Office. Not all the Black workers went on strike. Many of them had to stay away from their houses under pressure and intimidation. We also have proof— we saw this with our own eyes—that many of them locked themselves in the post offices so as to guard the premises in the interests of the Post Office. It was a senseless and insulting statement the hon member made in respect of workers who also serve the Post Office. Not one member of the Indian community went on strike, and not one member of the Coloured community went on strike, but the hon member concerned made wild statements, presumably for other purposes.

I asked my hon colleague from the Department of Transport Affairs to hold the fort for me for two minutes, after having sat here for quite a number of hours. I also knew that the hon member for Ventersdorp was speaking and that he would say nothing meaningful. My hon colleague gave me a few notes when I returned after two minutes, which confirmed that the hon member for Ventersdorp had said nothing worth reacting to.

I want to thank the hon member for Boksburg as chairman of the NP …

Mr Chairman, on a point of order: I want to put a question to the hon the Minister.

Order! No, that is not a point of order. The hon the Minister may proceed.

The hon member for Boksburg, who is chairman …

Is my statement correct?

Order! The hon member is shouting a question from his seat after not being allowed a question. That is outrageous. The hon the Minister may proceed.

I want to thank the hon member for Boksburg, who is chairman of the NP caucus and deputy chairman of the standing committee, most sincerely for the on-going advice he gives to me and the department. He is an expert in electro-technology, and we often make use of his expertise. He dealt very well with a few aspects, and I appreciate the advice he gives.

I also want to thank the hon members of the standing committee for their participation and interest in the activities of the Post Office. I want to thank the hon member for Primrose, as chairman of that committee, most sincerely for his particularly positive contribution.

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

No, Sir, I am not answering any questions. The hon members had ample time to put questions.

†The hon member for Groote Schuur, I believe, is a good lawyer. [Interjections.] I am glad to hear that he is. The hon member will know, however, that I am also a good lawyer. [Interjections.] Therefore, I cannot comment on telephone rumours but the hon member is welcome to visit me in my office so that we can discuss the matter. I do not know whether the hon member ’phoned someone or whether someone ’phoned him.

He phoned me.

I do not know what value to attach to this rumour but I can tell the hon member that it is most certainly not stipulated in the regulations or any of our staff codes that persons of colour may not supervise White staff. In fact, I know that it does happen in certain instances. In view of the suspicion being created I want to ask the hon member—who I think is a fair person—not to make statements of this kind until he has established the facts and given me the opportunity to discuss the matter fully with him.

As regards the Newtown land in Johannesburg, I know that particular property. It took quite a considerable time to negotiate the acquisition of the property. Architects of the city council had to draw up a plan according to particular standards in order to make it fit in with the scheme for that particular area, which required quite some time. It would appear that all that has now been settled and the planning is going ahead. As the hon member said it is a project of about R100 million and he will know that it takes a long time to plan and to construct something of that magnitude. I do not think three to four years is too long to complete a project like that. The hon member may rest assured, however, that I keep myself informed as far as I possibly can and I know that the Deputy Postmaster General entrusted with this kind of thing is giving the matter his personal attention. I think it will be an excellent investment as far as the Post Office is concerned. We need that facility in that particular area.

As far as the possibility of a second cable is concerned, the hon member is quite right that one must consider its economic viability. I have instructed a knowledgeable team comprising engineers and financial experts to investigate and make a submission to me. I am informed that the work has been completed and that the submission will be forthcoming. I will look into the position in the course of the next few weeks but, obviously, we are not going to establish such a facility unless it is an economically viable proposition. May I just mention to hon members that there are many overseas agencies which are very keen to enter into a partnership with us in this regard. We have succeeded in the field of telecommunications and that is why I am so anxious that we should try to eliminate politics from these debates.

There is a lot of goodwill on the part of various countries, and we have succeeded in establishing a good relationship with regard to the first undersea cable. Of course we have the two communication links, namely by satellite and the submarine cable. The existing submarine cable is getting old and the repair costs are becoming high, and that is why we have to look very seriously into the viability of a second one. I shall keep hon members informed about it.

Mr Chairman, may I ask the hon the Minister a question?

No, Mr Chairman.

I want to thank the hon member for Umhlatuzana most sincerely for the very good exposition he gave of the Post Office Savings Bank. It is an extremely important bank. It is really part of the culture of South Africa, and it has made a tremendous contribution to the financing of capital investment in respect of the Post Office. I only hope that it will go from strength to strength so that it can be run expertly in competition with other private institutions. Hon members have all heard what the hon the Minister of Finance had to say in that regard this afternoon as well. These are all steps which grant recognition to the important functions of the Post Office Savings Bank.

I do just want to mention a few matters, and perhaps that would resolve the questions hon members put. Throughout the debate I gained the impression that hon members, particularly hon members of the Official Opposition, had not made a proper study of the Government’s White Paper on Privatisation and Deregulation. In my Budget speech I gave the assurance that the guidelines in the White Paper would apply strictly in the case of the privatisation or deregulation of the Post Office services and facilities. Nevertheless hon members expressed fears and reservations which would not have been necessary if they had studied the White Paper.

For example, the strategic importance of the telephone network was mentioned. The criterion in the White Paper that the privatisation of a function or activity should not constitute a real risk to State security or internal order is sufficient guarantee that no move towards prrivatisation will be decided on lightly.

Another concern that was expressed was that the sparsely populated rural areas would be neglected in the case of privatisation because it was often uneconomical to provide services there. The assurance in the White Paper that privatisation would not defeat any constitutional, social or ecological aims should allay these fears.

I think it was the hon member for Losberg who referred to British Telecom. He relies on newspaper reports or articles he reads. I want to tell him that there are two sides to the story. I was there. I went to the trouble of speaking to their top people, and we learnt a great deal. They made many mistakes. We do not want to make the same mistakes they made. We are doing the research. Many of the points the hon member raised are matters we are investigating at present. At present Germany is engaged in a similar investigation. France has also resorted to privatisation to a certain extent, and they have all made mistakes, and we can learn a lot from those mistakes. The whole of Europe is taking an in-depth look at this to decide how they are going to use this important telecommunications service to everyone’s benefit.

There is also clearly a misapprehension that an attempt is being made to privatise the Post Office as a whole. For example, reference was made to the important agency services, such as the payment of pensions. I know of no country in the world—I went to ascertain this as well—where the Post Office as such is privatised. As I have said, we shall learn from the experience of others, and of course this is an important factor.

†Reservations have been expressed about monopolies and cartels developing. The Government is fully aware of these dangers, and has lain down clear guidelines to obviate this happening. [Interjections.]

The concentration of economic power will be avoided, and competition will be an important criterion.

*The process of far-reaching reorganisation of the Post Office, which we are engaged in at present, is really the continuation of a process which was begun as far back as 20 years ago when the Post Office was not a part of the central Public Service. These are logical further steps with the same aim, viz that of establishing the structures and to make the reclassifications and adjustments which will ensure the more effective functioning of the organisation as a business undertaking. The changes we envisage are things for which the time is perhaps ripe now. It is true that the changes are far-reaching and profound, but they are being effected with forethought, circumspection and the best advice at our disposal. I am convinced that what is being done in general is in the interests of the country, and that we can look forward with confidence to fine results in the next few years.

To conclude, I want to say that I took great pleasure in hearing that, with the exception of a few speakers, the House as a whole praised the efficiency and quality of the service the Post Office renders. I am very pleased that this is the case. They also praised the Post Office staff.

At the end of his career as Postmaster General, Mr Ridgard deserves praise for the fact that he is retiring from service on such a high note. He has occupied the highest position for the past three years, and he previously served in top management as Deputy Postmaster General for many years. I personally am extremely grateful to Mr Ridgard, and I know that I can also say on behalf of my predecessor, former colleague Munnik, that we always found Mr Ridgard to have a willing ear and a helping hand. He is competent, he is modest, he is purposeful, he is hardworking. He has already been in the service of the Post Office for 44 years. I think hon members will know that if one gives 44 years of one’s life to an organisation, one is doing it not because one is earning a salary, but because one is convinced that it is something worth doing. I am convinced that Mr Ridgard conveys that positive attitude and that that is how he inspired his top management and all the officials of the Post Office. I just want to mention that he is a modest man who did not at any time hesitate to converse with any Post Office official, be he senior or junior, and listen to his problems. I want to wish him and his wife good health and a happy and peaceful time with their children and grandchildren. I am sure we shall always think of him with affection.

In conclusion, I once again want to congratulate Mr Johan de Villiers on his appointment as the new Deputy Postmaster General. Most hon members know him. He is a competent man, and I have no doubt that he will continue to follow in the footsteps of Mr Ridgard. I wish him everything of the best, too.

Question agreed to.

Bill read a third time.

Mr Chairman, the re-use of water in the Republic of South Africa by means of purification methods is becoming a source that can be advantageously utilised to an increasing degree. In order to utilise this source fully, the water legislation of 1956 was amended in 1981 to purify, to treat, and to dispose of water on a regional level by means of various water boards. This amending Bill proposes that the same powers be granted to the Rand Water Board.

Clauses 4 and 5 deal with compulsory powers with reference to the purchase of land, the arrangement and control of the board’s finances and the appointment of a finance and executive committee.

Clause 6 provides that interest can be levied on due amounts in respect of water that has been supplied, at a rate that will be determined by the board from time to time.

Clause 8 provides that from time to time the board can borrow money from any bank which will then act as the board’s bankers. This has a restriction of 20% on the revenue derived from water-tariffs during the preceding year. Clause 9 once again determines the total amount payable in respect of bills which may not exceed 30% of the preceding year’s revenue.

The CP finds no fault with any off the preceding clauses, and we would gladly have supported the Bill if it had been acceptable to us as a whole. The CP has a problem, however, with the specific clause that deals with preferent consumers, viz clause 1.

The original three-tier tariff now has to be converted to a two-tier tariff. This two-tier tariff will mean that foundation members, including the SATS, mining companies, the city councils of Boksburg, Brakpan, Germiston, Johannesburg, Krugersdorp, Nigel, Pretoria, Randfontein, Roodepoort, Springs and Vereeniging will now have to pay 2,9% more for their water and that new local authorities will receive an advantage of 6,1% of the present tariff structure.

We think this is unfair to foundation consumers who have helped to sustain the infrastructure for many years. To my knowledge consumers in the foundation areas were never informed or consulted about the new tariff structure. Consequently the CP cannot support this clause. I doubt whether any NP members in those areas consulted or informed their voters and can say today that their voters support the new tariff structure.

Clause 3 of the amending Bill provides that the board will consist of a maximum of 12 members, and not of nine as was the case previously. Formerly the board consisted of three White city council representatives, of whom one came from Pretoria, one from Johannesburg and one from the East Rand. In addition there was one representative from the Department of Health, one from the Department of Water Affairs, one representing industry, one representing the gold mining industry and the chairman of the Rand Water Board. They were all appointed by the Minister of Water Affairs. Of those parties represented, industry and the gold mines are the largest consumers.

Provision must now be made for greater representation of local authorities, especially with the establishment of Black local authorities. The implications of this new approach are very clear. They point to the establishment of a mixed board.

Are you a racist too?

That hon member can say whatever he likes. The CP has its policy, and we are not afraid of it. [Interjections.]

The CP sees no necessity whatsoever for an enlarged board. Enlarging the board will make it clumsy and will entail greater financial expenditure.

Which population group consumes most water?

That hon member will have an opportunity to speak later. The back-bencher will get an opportunity one day, in about three months’ time.

The present board can supply water in any other authority’s area on the same basis as is the case at present. Not all local authorities obtaining water from the board at the moment are represented on the board. The same agreements that exist between the board and such authorities can be negotiated with new local authorities.

For these reasons the Official Opposition is not prepared to support this Bill.

Mr Chairman, I want to thank the hon member for Middelburg for his party’s support of the clauses of this Bill that they agree with. I find it a great pity, however, that they do not agree with the two important clauses he mentioned, one of which concerns the extension of the number of members of the Rand Water Board from 9 to 12. The nine members were appointed when the Rand Water Board was established, long before the First World War took place, and they have done this important work well for many years. We are very satisfied with their work, but one must acknowledge that the number of consumers has increased considerably. The hon member mentioned the consumers who have had representation, viz the three municipalities, the Department of Health, the Department of Water Affairs and industry. I think the hon member said the gold mining industry had only one representative, but to my knowledge there were two. There was also a chairman.

The number of consumers has increased to such an extent since the Act was revised during the fifties, without extending the number of members, that there is really a need for greater representation for the people who use the water.

There are many residential areas for non-Whites which fall within the service area of the Rand Water Board. They have no say and would probably like to be represented. If they were to get representation, however, it could not be a matter only of the allowance they received for filling that position. They would have to bear responsibility and ensure, in their own environment and among their own people, that the water that was supplied was utilised correctly.

Are they also going to pay for the water that is supplied?

They will pay for it. The hon members can make as much noise as they like, because they know it will be paid for and that provision is not being made for this for no reason at all. [Interjections.] It is necessary for good co-operation and so that the water can be distributed properly.

It was said that in the beginning the mines used twice as much water as private consumers did. Industry also used far more. Today the single consumers or private consumers in the various townships have caught up with them and outstripped them in many cases. Industry is satisfied with its one representative, and the gold mining industry, which consumes far more water than the others, is satisfied with its two representatives.

I think it is quite appropriate to extend the board from 9 members to 12, as has been requested, and also to give representation to the areas that have been established since the Rand Water Board was established. This will facilitate the operation of the board and everyone will have a say in how the water should be distributed.

The Official Opposition also objected to section 49 with reference to the three tariffs for water supply. That is also something that was instituted right at the beginning. The foundation members paid a low price, the preferent members paid a little more and all other members who have joined since the board was established, paid the highest price. The proposed amendment envisages having the tariffs changed so that only two tariffs will apply, viz a tariff for preferent consumers and a normal tariff.

This will mean that as the situation stands at present, the foundation members’ tariff will increase by 2,93%, and the majority of consumers will benefit from this new tariff, because their tariff will drop by 6,15%. This is a wonderful proposal that has been made. To me it looks as though the long-term idea will be to have only one price system. Surely that would be a good thing. It would eliminate a great deal of work. At present only a two-tariff system is being requested, but I predict that eventually we shall have a single-tariff system, and everyone will pay the same price; that the old foundation members of the Rand Water Board and those who have joined at this late stage will all pay the same tariff. That will make sense. It will facilitate the administration, and everyone will be happy.

Mr Chairman, in this instance we must agree with the hon member for Meyerton, and we are going to support this Bill.

We cannot agree with the point of view of the CP through the mouth of the hon member for Middelburg, although I think it was the hon member for Nigel who served on the standing committee and held this viewpoint. The tariff structure of the Rand Water Board is a three-tier one, with provision being made for a preferential tariff to certain foundation local authorities, and many new local authorities at present do not get the benefit of lower water tariffs. This is manifestly unfair. A provision in this legislation gets rid of this anomaly in part by equalising the rate paid by foundation members and preferent consumers. This move certainly has our approval. I do not know whether the local authorities concerned where consulted. The local authorities which I am concerned with will be very happy with this move because they will pay a little less for their water.

We would be left with a two tier tariff structure, the difference in the two tariffs having to do with the difference in quantity of water consumed. This is a normal procedure—if one buys in bulk one deserves to get things a little cheaper.

Because of the many new local authorities in the Rand Water. Board area it is suggested that the size of the board be increased from 9 to 12 members. This would allow a greater spread of representation of the various areas concerned, but the hon members of the CP disagree with this. At the present all the members of the board are White. This is patently unfair when one considers that the majority of consumers in the board area are not White. I do not know how one differentiates between White water and Black water. I do not even know, on the other hand, how one differentiates as far as other services are concerned. Does one have one sewerage system for Whites and a different one for Blacks? One must accept that the majority of people using water on the Witwatersrand are Black people.

Then why do you not suggest giving them the majority on the board?

Well, Sir, we do not suggest a majority on the board at all, because we do not believe in differentiating on the basis of colour. We say: Put the right people in for the job, and if they represent particular local authorities they should be on the board.

This particular amendment has our approval, provided that the hon the Minister gives an undertaking—and I would like to hear this—that the new positions will immediately be filled by persons representative of the newly established communities. In addition, when the present board ends its term of office—which I believe is sometime next year—we hope that the new board selected by the hon the Minister will reflect more adequately the nature of the community as a whole. I hope he will tell us in his reply to the debate that this is his intention.

The other provisions of the Bill should not be contentious at all, and provided that the hon the Minister gives us the undertaking we are asking for, we will support the whole Bill.

Mr Chairman, I should like to convey my sincere thanks to the hon members who supported the Bill under discussion.

†Turning immediately to the hon member for Bryanston, I want to thank him too for his support of the Bill. He asked me for an assurance that the new communities would be represented on the board. Unfortunately, Sir, I cannot give the hon member that assurance. I can, however, give him the assurance that the new communities will be invited to nominate members, and if those nominations have merit they will certainly be considered.

Mr Chairman, may I put a question to the hon the Minister? The word I used was “representative”, not “represented”. I do not want these particular people to be actually representing the board. I want them to reflect and be representative of the new communities. What is the hon the Minister’s reaction to that?

Mr Chairman, allow me to explain. This board is a board of knowledgeable people. The person who handles the interests of a new community need not necessarily come from that community.

†I can assure the hon member for Bryanston that I will appoint members with merit representing community interests.

*This also applies to the other interests, however. I cannot appoint a board on the basis—I am referring to the hon member for Middelburg as well—that it represents mining interests or a specific population group in particular. I have to appoint a board of knowledgeable people. In their expertise they will also take the interests of the respective interest groups into consideration.

The only real objection that was raised came from the hon member for Middelburg. He was concerned about the extension of the board and was worried that eventually we would have a mixed board. [Interjections.] Mr Chairman, I simply do not understand the hon member. I do not understand him, because in terms of his own party’s policy, once he had implemented his policy and specific White communities have been established or a White homeland had been established—naturally I do not know what this would look like—he would have to consult with his Black neighbours when it came to a matter of common concern such as water. [Interjections.] Just as we have agreements with our neighbouring states at present—where we have joint technical committees and bilateral agreements, for example—he will of necessity have to consult those people to decide on the supply of water. I cannot understand their problem, therefore. [Interjections.] We are dealing with exactly the same principle here. Ultimately there will be only one water source in the whole of the Republic, because all the water sources will be integrated into a national water system. [Interjections.] Since we shall all have to drink from one water source, we shall have to talk to one another. (Interjections.) Surely we shall have to talk to one another about how we are going to share this common water source. [Interjections.] I really cannot understand the hon member for Middelburg’s problem. [Interjections ] What we are doing …

He wants only White water! [Interjections.]

What we are doing now, is precisely what the hon member will have to do when his party’s policy is implemented one day.

It is going to happen much more quickly than you think! [Interjections.]

As far as the equalising of the water tariff is concerned, I think the original foundation members received a concession— many years ago; towards the beginning of the century—because they were supplying their own water requirements at the time. They have not been doing this for many years now. They all use water from the same water source. Why then must the community of Boksburg pay a different water tariff from the community of Kempton Park? [Interjections.]

Mr Chairman, in that case may I ask the hon the Minister why borehole water is an own affair? [Interjections.]

Sir, borehole water has nothing to do with this legislation. [Interjections.] We use water from the same common source now. Why then must Boksburg and Kempton Park, just to give an example, have two different water tariffs? [Interjections.]

Order! No, perhaps hon members do not like the answers, but at least they must listen to the hon the Minister. The hon the Minister may proceed.

Thank you very much, Sir; I appreciate that.

The reason that applied in respect of the special preferent tariff for these foundation members at that time has not applied for some time now. In addition—let us be honest—these foundation members enjoyed the privilege of a lower tariff for many years. They enjoyed a great privilege in that they could develop their infrastructure at a lower rate. They have an established infrastructure today. The new areas that have to be developed now are being penalised in terms of the present system in that they have to pay a high tariff. I think that is very unfair, Sir. The new areas are, in fact, the ones that should pay a lower tariff. That is why I cannot accept the CP’s objection in respect of this matter.

Question agreed to (Official Opposition dissenting).

Bill read a second time.

Mr Chairman, I move:

Mr Chairman, we discussed this amending Bill thoroughly during the Second Reading debate as well as during the Committee Stage, and we raised the objections we have to this Bill on those occasions.

In particular we pointed out the negative financial implications the Bill has for White education. The objections we raised then were confirmed this afternoon when the Budget was tabled, and it was mentioned that as far as own affairs was concerned, the House of Representatives and the House of Delegates were receiving R341 million and R101 million more respectively, whereas R94 million less had been allocated for the House of Assembly’s own affairs budget.

We on this side of the House were probably not able to convince the hon the Minister with our arguments, but we should like to say that the replies he gave us during the Second Reading debate and the Committee Stage did not convince this side of the House that we were wrong. We on this side of the House will support this legislation, however. [Interjections.]

Mr Chairman, it is a pity that in his analysis of the Budget that was submitted this afternoon, the hon member for Brits looked only at the reduction in figures and did not take the demographic reduction of the figure on the denominator of the amount that was to be determined into account. He merely referred to the final figure given in the Budget. He did not say a word about the reduction in the number of pupils in White education, and merely mentioned the percentage reduction in comparison with last year’s figure. It is true, Sir, that last year alone we had a decrease of 7 000 pupils in White education. Since there are fewer pupils, surely there should be a reduction in the amount that is appropriated.

Secondly the hon member is not satisfied with the reply given to him by the hon the Minister in respect of his other objection. My problem with the CP is that they make a great fuss about their feelings with reference to the education profession, but in reality, when education comes to Parliament with legislation such as this—which will give them rights that they themselves requested; they negotiated this with the Committee of Technikon Principals and the hon the Minister was consulted as well; and I want to add that the legislation was drawn up and worded as they wanted it to be—they tell the teachers, whom they fawned upon to such an extent a while ago, saying how much they cared for them, that they do not trust them.

What the CP is implying, therefore, is that the teachers cannot be trusted to make a choice in respect of a field of study if it concerns a department which is a so-called general affairs department. In reality the CP is telling the teachers that they do not trust them in the educational sphere, or when it comes to content programmes. They should not present these things any differently from the way in which the CP decides they should be presented. Their politburo must first decide what may be presented, and that is acceptable only if it is approved. The CP does not trust the teachers and educationalists with this, however, and wants to retain those rights as political decisions. [Interjections.]

The technikons came a long way last year in dealing with their own affairs with the legislation in terms of which they were established. They consulted closely with the Committee of Technikon Principals. Each technikon has its own technikon council which very carefully governs and controls that institution.

The technikons are preparing a very durable course in the technical sphere for the developed South Africa which is at hand. There is a very wide world open to the technikons, and on the tertiary level they are acutely competing with the established universities. Consequently they have to request certain powers by means of this legislation, in respect of training institutions in which training has not yet taken place, for example. Yet the CP tells us that it questions the technikons’ judgment. It doubts whether they should be allowed to train people in those fields.

We on this side of the House, however, have great appreciation for the fields that are being opened up by this legislation. We trust that these technikons will mean a great deal to South Africa. We believe that they will determine the fields in which they want to offer training within the ambit of the provisions of the Constitution. We also believe that they will maintain a standard which will take the market at which this training is aimed into account. We are convinced that they have only the best intentions in wanting to do this.

That is why we should like to entrust them with these measures. In doing so we also want to express our sincere appreciation for the way in which they are tackling things. Through the hon the Minister, for whom they have great respect, and the Superintendent-General, with whom they co-operate well, we want to wish these people everything of the best in all the training they are going to do in our country at this level of education.

Mr Chairman, the PFP opposed the Second Reading of this Bill, and we opposed clause 1 in particular in the Committee Stage. The main purpose of this measure is the transfer of overall control of certain technikons to the Minister of Education and Culture in the House of Assembly, and in effect to make them an own affair. In this respect I can do no better than quote from an editorial in The Natal Mercury of 14 March, as follows:

That is the problem with this piece of legislation. [Interjections. ] In effect, it actually gives a White Minister control of technikons that should be serving all South Africans, because that is the kind of structure this Government desires.

The hon member for Brentwood praised the technikons, and I have no problem with that. I believe they are doing excellent work.

However, when I look at the second year syllabus for the history of ballet, for example, I see that it covers topics like Diaghilev, a Russian, English ballet, ballet in South Africa—including the Eoan Group, a Coloured group—as well as ballet in Europe, Australia and Canada. The reason why I raise the question of ballet is because there is only one technikon in South Africa which offers ballet as a subject, and that is the Pretoria Technikon. Whatever colour one is, if one wishes to study ballet at a technikon, one is obliged to go to Pretoria Technikon. [Interjections.]

In terms of the overall perspective of technikons in South Africa it is obviously our aim to use them to the maximum advantage. Some of these technikons are going to have more and more students of colour—to use that phrase. What happens if some of these technikons have more than 50% students who are not White? Are they going to be transferred to another department? What we say is quite clear: It is highly unfortunate that our amendment in the Second Reading debate, that technikons should be allowed to fall under the hon the Minister of National Education, was defeated. We believe that here at technikon level there is certainly no argument which can be proposed in terms of culture that would make technikons an own affair.

We are, in particular, unhappy about the passing of section 28 and its effect. The hon the Minister knows this and I am not going to repeat it.

So, because we in this party are totally opposed to the concept of racial own affairs—I want to make the point that we are opposed to skin colour being the division line for own affairs—in this country, we will oppose the Third Reading of this measure.

Mr Chairman, in the first place I want to express my thanks to the three hon members for their contributions this evening. We have reached the Third Reading stage, but I also want to express my thanks for the contributions that were made in the Second Reading debate as well as in the Committee Stage.

It is true that the hon member for Brits expressed his opposition to the legislation on behalf of the Official Opposition. It is the hon member’s right to say we did not convince him. The hon member is opposed to the negative financial implications of the legislation. The implications he referred to can be made applicable only to the fact that the Minister of Education and Culture is being empowered to make a certain institution, which provides technical education, a subsection of a technikon and that for that reason additional non-Whites may be admitted to such a technikon. The fact, however, is that in terms of the Constitution it is already possible for a technikon to render service to non-Whites.

I object to that too.

Very well, the hon member objects to that too, and he has a right to, but nothing new is being introduced. It is not true that this will have a sudden negative effect on the Whites’ monetary position. I pointed this out in the Second Reading debate and do not want to elaborate further.

I think the hon member for Brentwood gave the hon member for Brits an excellent reply to the points he raised in respect of the Budget Speech that was delivered today. [Interjections. ] I do not want to debate that in this debate as well. We shall have an opportunity to debate that matter during the own affairs budget which takes place next week. We shall also be able to discuss it later during the discussion of my Vote. The hon member is welcome, therefore, to talk about this during the discussion of the own affairs budget and we can then debate the matter further.

I want to thank the hon member for Brentwood for his effective and concise reply, in my opinion, to the hon member for Brits. In a few sentences the hon member also emphasised the importance of the technikons very strongly. It is true that we are entering an era in which we shall have to give more attention to technical education.

The co-operation we are experiencing with the technikons in this connection is encouraging, and the fact that they are rendering excellent work of high calibre deserves the praise of everyone in this country. The hon member pointed this out very clearly, and I thank him for doing so.

The hon member for Pinetown is opposed to technikons as an own affair. The fact is that all technikons have been declared own affairs. The Constitution makes it very clear that all education at all levels is an own affair. [Interjections.] I shall come back now to the point the hon member probably wants to raise. All technikons already fall under the Department of Education and Culture.

Where did you study ballet?

I shall come to that. The hon member must just wait a moment; then he will learn to dance too.

How can an own affair also be a mixed affair?

The only thing that has been added in this Bill—and this is what I cannot understand about the hon member—is that a specific institution, or a part of it, can be transferred to a technikon. What is interesting about this is what is happening at Saasveld now, for example. Saasveld is going to be transferred, and this gives the Official Opposition the shivers. Provision is being made for the training of people of colour because they can get better training there. Yet the hon member was complaining about that!

I was not complaining about it.

Of course the hon member was complaining. He cannot have his bread buttered on both sides. They are going to an own affairs institution now. The hon member’s argument was that the Black students should rather get poorer training because it is not presented at a general institution, but they must not go to a technikon where there is an opportunity for them to receive training for a National Certificate. That is what he implied.

[Inaudible.]

The hon member spoke about ballet. He quoted French ballet and English ballet and all kinds of ballet, and his hon colleague danced on the stage with him. What is own affairs? Own affairs and own education do not mean education from a primarily cultural and traditional point of view—it also means that one will educate and train the pupils in one’s care for the life they are going to have, viz a multicultural life. What is happening in the technikons? In terms of the principle of rendering a service, the technikons and universities are already providing an opportunity for those people to be trained.

With regard to ballet, the hon members must remember that the technikon itself applies to present a certain course and that the Committee of Technikon Principals takes the final decision on the matter. If, therefore, there is a need to give more ballet training at any technikon, it can be considered. I therefore do not know what the hon member’s problem is in this respect.

I now come to the question of admission. Admission is based on the policy decided upon by the technikon itself in consultation with the Minister, as I said during the Second Reading debate. The hon member’s question about what would happen if the number of non-Whites reached a certain level is not relevant at the moment. The technikon as such, and its council, will decide to what extent it will admit non-Whites. It is really presumptuous to speculate about this now, and it is not necessary to discuss the matter.

I do not want to take up any more of the House’s time. I merely want to associate myself with the hon member for Brentwood in saying that apart from technical amendments, which are consequential to the new constitutional dispensation, and technical rectifications because of other legislation, this Bill deals mainly with the alteration of the names of three technikons, which have been made at their request. The other important point is the one I have just argued with the hon member for Pinetown in respect of the right that is being granted to technikons to incorporate certain institutions. I think this is in the interests of training in general. Once again I want to associate myself with the hon member for Brentwood in expressing my great appreciation and thanks to the technikons for the excellent service they render. I wish them everything of the best.

Question agreed to (Official Opposition and Progressive Federal Party dissenting).

Bill read a third time.

Mr Chairman, I move:

Hon members will remember that the Church Square, Pretoria, Development Act, 1972, was the direct consequence of a controversy concerning the western facade of Church Square. The objective of this Act was to preserve the historico-cultural heritage of Church Square. Any development of Church Square was made subject to the approval of the Minister in consultation with the Pretoria City Council and the Church Square Committee.

Initially the Church Square Committee dealt with numerous applications for development, but recently they have had few meetings. Because of the considerable abatement in its activities, and the fact that they met only twice in 1985 and 1986, the committee reflected on the desirability of this Act. I am convinced, however, that the historico-cultural heritage of Church Square should be assured by means of this Act.

The Bill before the House makes provision for this, even with the restructuring of the Church Square Committee as envisaged in clause 3. In my opinion the committee is now representative of the disciplines that will really be able to reconcile preservation and orderly development.

Another important aspect to which I want to draw hon members’ attention, is the provision for the delegation of powers as proposed in clause 4. I do not think anyone can doubt the earnestness of the city council’s management committee and the city council of Pretoria when it comes to maintaining and preserving the city’s historico-cultural heritage. A further important aspect is the fact that devolution of authority is taking place, which makes it possible for decisions to be taken at the local level.

The penal provisions are also being adapted as proposed in clause 5, and that should prove with what gravity offences are regarded.

The other proposed amendments are consequential amendments as a result of obsolete names.

Mr Chairman, this Bill which relates to the development of Church Square, Pretoria, and certain adjoining sites, comprises the improvement of the definitions of certain expressions and the deletion of others. In addition provision is made for the delegation of certain powers by the Minister of Local Government, Housing and Works: Administration: House of Assembly to the management committee of the Pretoria City Council.

In terms of clause 1, “Minister of Public Works” is replaced by “Minister of Local Government, Housing and Works: Administration: House of Assembly”. In subsection (c) “Secretary” is deleted and in (d) “Stadsraad” in the Afrikaans text is replaced by “Stadsraad van Pretoria”. All these amendments are improvements. The new Minister responsible is the Minister of Local Government, Housing and Works, and no longer the Minister of Public Works.

Section 2 deals with the prohibition on the development of Church Square and adjoining sites. The Minister grants or withholds his approval after having consulted with the committee. This committee, under the chairmanship of the Town Clerk of Pretoria, consists of members as provided in this amending Bill, viz the Head of the Architectural Services Section in the Department of Local Government, Housing and Works: Administration: House of Assembly, the Senior Director of Works and Estates in the Department of Posts and Telecommunications, and so on.

Section 2B is being replaced as a whole by a new section. In terms of this, powers are delegated to the management committee of Pretoria to take decisions.

Clause 5 deals with the penal provisions and the fine is being increased from R1 000 to R10 000 and, in the case of a continuing offence, from R50 per day to R100 per day.

The sections I have referred to are mainly those that are affected by this amending Bill. The Official Opposition gladly supports this amending Bill.

Mr Chairman, I want to thank the hon member for Middelburg sincerely for his support of this amending Bill. It is gratifying to hear that we have the support of that side of the House in this amendment.

The fact is that this amending Bill is aimed at streamlining the existing Act. It is also aimed at structuring the committee that deals with these matters. You will permit me, Sir, to say that the historic nucleus of Pretoria is being affected by this amendment. I am proud of being the representative of the constituency in which this historic nucleus is situated.

We are pleased that the town clerk of Pretoria, who is the chief executive official of the city council, is very closely involved with this matter as chairman of this newly structured committee. The city council has a fundamental interest, firstly in how the residents of Pretoria experience the city and, secondly, in the preservation and control of Church Square. Every hon member in this House who comes from Pretoria welcomes the greater role the Government is playing, by way of various Government departments, in preserving and maintaining Church Square, and without wanting to take up any more of hon members’ time, I should like to support this positive amending Bill on Church Square.

Mr Chairman, it will come as no surprise to the hon the Minister that we in the PFP shall oppose the Bill in the form in which it has been tabled. [Interjections.]

We have no problem with, and in fact support, the intention to maintain control over property in Church Square in Pretoria. It is obvious that Church Square, like many other central city areas, is a sensitive area for historical and many other reasons. It is therefore right to legislate additional protection measures to ensure that development is appropriate and does not spoil the environment.

This Bill has, however, been introduced as an own affairs Bill, whereas we believe that issues affecting our cities should be general affairs. In fact, we are totally opposed to the distinction between own and general affairs. If that has to be done, however, we argue that Church Square, Pretoria, should be a general affair.

When were you last in Pretoria?

All our citizens use our cities—I should like the hon the Minister to listen to me—as shoppers, workers, businessmen and for many other reasons, whatever their colour or race may be.

In response to a question put by the hon member for Pinelands last week, the hon the Minister of Constitutional Development and Planning advised us that on 19 February of this year 60 cities and towns in South Africa had applied to open their CBD’s. These include not only Johannesburg, Cape Town, and Durban, but—it is very interesting to note this, and the hon members of the CP should also listen to this—also Delmas, Witbank, Pietersburg and Roodepoort. [Interjections.] All these places have applied for open CBD’s.

In this list of 60 cities Pretoria is not to be found. It is a disgrace that Pretoria, one of the capitals of South Africa, is not one of them. Reform should start where the executive power of Government is seated, where those hon Ministers carry out the laws of this country. Why should the development of Pretoria, or any other city in South Africa, be considered on racial lines? Why should decisions in that regard be a racially exclusive Whites only affair?

Therefore we strongly believe this matter should fall under general affairs, and for this reason we oppose the Bill as tabled.

Mr Chairman, in the first place I want to thank the hon member for Middelburg for his positive contribution and support. I should also like to thank the hon member for Pretoria Central for his speech and his support. Church Square is in the hon member’s constituency, and he has a special interest in this matter. I think the hon member made a good speech.

I am very sorry that the hon member for Parktown chose this time to come forward with his argument. I really think the hon member could have spoken about the throwing open of business areas in the applicable Vote.

The hon member is welcome to make inquiries about the steps Pretoria has taken in this connection. He must just first make sure of his facts, because in reply to a question he deduced that nothing else had happened in Pretoria. He must first acquaint himself with the facts. [Interjections.] It is not fair of him to make certain statements about the Pretoria City Council. Those representatives are not here to protect themselves, on behalf of the city council, against the suspicion cast on them by the hon member as far as steps concerning the possible throwing open of certain central business areas is concerned. I want to ask him whether he has read the Church Square, Pretoria, Development Act. [Interjections.]

[Inaudible.]

No, I want to know whether he has read the original Act.

Is this own affairs?

I am not talking about the Bill before the House. Has the hon member read the original Act? Has he read the description of Church Square in Schedule A? [Interjections.]

With all due respect, the hon member got up here with the specific purpose of disparaging own and general affairs, and particularly own affairs. He has never even looked at the original Act. [Interjections.] Church Square became the property of the Pretoria City Council in terms of a crown grant in 1905. In other words, much was made of Church Square even in those days. In the meantime the old Raadsaal has, inter alia, been transferred as the seat of the Ministers’ Council of the Administration: House of Assembly.

Is that an own affair?

Yes. During the debate on the Part Appropriation I said that we in the Ministers’ Council were very proud of having the old Raadsaal as the seat of the Administration: House of Assembly. Church Square and the old Raadsaal have close links with what belongs to the people. We are also proud of being able to say that in terms of this legislation we are attending to our historico-cultural heritage. We are not ashamed of that. I am very sorry if that does not meet with the hon member’s approval. I should like to invite him to pay more attention to the correctness of the facts in his speeches and also to look at existing legislation.

I do not want to prolong the proceedings any further. I thank hon members for their support.

Question agreed to (Progressive Federal Party dissenting).

Bill read a second time.

Bill not committed.

Bill read a third time.

Mr Chairman, I move:

Agreed to.

Mr Chairman, as the hon the Minister of Finance announced in Parliament today, the Government has found it possible under the present difficult financial conditions our country is experiencing to grant a one-time bonus to recipients of social pensions and grants. The amount of R110 million that has been made available for this bonus has been divided up among the number of social pensioners who are being benefited, and will amount to R60 per person.

The Government is aware of these citizens’ financial circumstances and would like to make more funds available for social pensions. The bonus will be paid out during October 1988.

The Ministers concerned who are responsible for welfare services are negotiating with the hon the Minister of Finance, however, on a possible advancement of the payment of the bonus.

I shall make an announcement later in connection with the improvement of social pensions and grants to narrow the existing gap between the White and Coloured components.

Mr Chairman, I move without notice:

*Mr Chairman, these political games must be stopped. Hon members in this House have come here to represent their people.

†They did not come here to score political points, nor did they come here to waste hon members’ time. The hon members of the Official Opposition must stop being politically dishonest. This is precisely why I say that for as long as they absent themselves, their parliamentary privileges should be withdrawn. If they had been at all honest in their whole exercise, they would have indicated right at the outset that their protest was aimed at the actions of the hon the Minister of Law and Order and that while they were absent, they ceased to be members of this House.

I cannot but disagree entirely with the actions of hon members of the Official Opposition. One must remember that every hon member of the Official Opposition, bar the hon member for Bosmont, came here on the ticket of the LP. Those people who voted for them, voted for the principles and the policy of the LP. Their moving over without the consent of their constituents was in itself a dishonest action. Be that be as it may, I, as a responsible hon member of the LP, still believe that those LP supporters who voted for them are entitled to representation in this Chamber.

Hon members of the Official Opposition are being paid to be here. This is not the first time they have done this. At least they had the courtesy this time to say that they were going to absent themselves. However, since they have moved over to the opposition, they have been continually absent. Here again they are using a situation for an ulterior purpose. That is nothing less than political dishonesty and opportunism. I do not think we can afford this kind of luxury in this Chamber.

*When our members want to go and work for a by-election we get up here and ask to be excused in order that we may go and work.

†They, however, use other people’s fights to their advantage. I sympathise with those extra-parliamentary forces, although I do not necessarily agree with them. However, I will not use their fight to fight a by-election for a seat in this Chamber, because their fight outside is one of non-participation. I believe this sort of dishonesty must come to an end. This sort of point scoring must also come to an end. It is about time that people put their money where their mouth is.

*It is easy to talk. Anybody can make idle talk as long as it is free.

†However, I now give hon members of the Official Opposition the opportunity to put their money where their mouth is, to bring about a certain measure of honesty in this whole exercise of protest.

Mr Chairman, I rise in support of the motion as introduced by the hon the Leader of the House. For some time now, since the former Democratic Party broke away from the LP, we have seen how we have had to do the work of the hon members in the opposition benches. They are absolutely guilty of an irresponsible stay-away. If they do not sit here for only a few minutes every afternoon and then run away, there is only one hon member in the House who sits and watches the quorum so that he can raise a point of order.

Last year they were absent from the House for three months in order to fight us in Gelvandale and Northern Transvaal, while we had to keep the House going, and despite that they lost. Now there is a by-election in Bokkeveld, and all of a sudden they have had to find a reason as to why they can no longer sit here, but have to be there. There are two imminent by-elections in Natal Mid-East and Eersterus too, however, and it is a well-known fact in Parliament that members of the opposition parties are already conducting vulture politics there, while we are doing the work in Parliament.

It is the task and responsibility of members of Parliament to raise the interests of their voters in Parliament when Parliament is in session, and therefore the motion is quite justified; when a member of Parliament does not do his duty here, he should not be remunerated.

Another matter to which I want to draw hon members’ attention is the question of the standing committees. Standing committees are a very important facet of the Parliamentary system in the new constitutional dispensation, and the hon members of the Official Opposition are conspicuous by their absence in standing committees. Then they want to jump up in this House to put questions, whereas they can do all that in the standing committees.

I have said that the LP will not permit people to conduct vulture politics while we are being kept busy with other things here. There is an opportunity for the Official Opposition to show the sincerity of their statement now. They can stay away without remuneration and in that way pay for the political convictions they put so bravely the other day. I have great misgivings, however, about the hon the Leader of the Official Opposition’s sudden sympathies with the UDF. His jump from the right-wing radical side to the left-wing radical side proves once again that the hon member has no specific political convictions. He is really just a political prostitute.

Order! The hon member must please withdraw his last statement.

Mr Chairman, I withdraw the word “prostitute”.

Mr Chairman, I rise to speak in support of the motion moved by the hon member for Toekomsrus. [Interjections.] I do not regard the Official Opposition in this House as a real opposition party.

For two and a half years, I believe, they voted for every motion which came from the ruling party in this House. They came to this Chamber as bona fide members of the ruling party. Therefore, their adopting such a strong opposition standpoint now is merely political fly-catching; they are merely playing for the extra-parliamentary forum. That cannot and will not be to their benefit.

I believe the formation of this new United Democratic Party—it was formed when those members walked over to this side of the Chamber— was a move aimed merely at political and financial gain. [Interjections.] I regard them as a bunch of political nonentities at this point in time. I feel that if they are really honest in the stand they are taking, and which they have been taking over the past few days in absenting themselves from this Chamber in the manner in which they have been doing so, they will resign. I call upon them to do so.

Mr Chairman, allow me to thank the two hon members who took part in the debate for their participation. I would especially like to thank the hon member for Ottery for his contribution and support.

†Sir, I know that the Rules provide for hon members to absent themselves for a number of days during a session. I am not asking for that provision to be changed. I am merely asking for a course of action to be justified. I am asking for honesty in the taking of that course of action. For that reason I say that if people want to demonstrate their objection, they must go the whole hog. They must not keep the cream and throw away the rest. It is easy to sacrifice by not doing the work of the people, but the real sacrifice will have been made if those hon members gave up their parliamentary privileges, including the parliamentary allowances that they are entitled to. One must be clear about parliamentary allowances. Hon members are paid parliamentary allowances for the duties which they perform in this Chamber and in this Parliament as a whole. I know that a great deal of nonsense is being talked outside about the amount of money which hon members receive in parliamentary allowances. I want this message to go out loudly and clearly: The parliamentary allowance is not a big sum. For the amount of time and effort that members of Parliament have to put in, the private sector would pay a better allowance. Anyone who knows how many hours of effort we put in, what sacrifices we make, and what great expenses we incur in respect of communication, travel and service to constituencies, will agree that the amount of money that members of Parliament receive is not great.

If hon members do not do the work of the people, if they do not represent their people, if they do not do their duty in Parliament and do not serve their constituencies, they are certainly not entitled to an allowance.

Question agreed to (Official Opposition dissenting).

Mr Chairman, I move:

Agreed to.

Mr Chairman, as announced in Parliament today by the hon the Minister of Finance, the Government, notwithstanding the present difficult financial circumstances of our country, found it possible to grant a single bonus to social pensioners and grant beneficiaries in the coming financial year. The amount of R110 million which has been made available for this bonus has been divided among a number of social pensioners and beneficiaries and will amount to R60 per person. The Government is aware of the financial circumstances of these citizens and would have liked to have allocated more funds for social pensions. I am, however, convinced that the beneficiaries will understand why, as a result of the financial position of the country, no monthly increases can be awarded this year. The bonus will be paid during October 1988. The Ministers responsible for welfare services are, however, busy negotiating with the hon the Minister of Finance regarding a possible advance in the payment of this bonus.

Mr Chairman, due to the unavoidable absence of the hon the Chairman of the Ministers’ Council, who has placed Notice of Motion No 1 on the Order Paper, I move:

Agreed to.

Mr Chairman, I move:

Mr Chairman, the South African Transport Services Conditions of Service Bill contains the new format for labour relations. It provides for a Labour Council. This is a forum for collective bargaining between SATS management and organised labour. The Bill largely follows the recommendations of a commission of enquiry into SATS’s negotiating structures appointed in 1986 and chaired by Prof Nic Wiehahn.

Until now pay levels and conditions of employment have effectively been determined by the Minister after informal discussion with the ten recognised unions. The Bills outlines strike action, and contraventions render employees liable to a year’s imprisonment and/or a fine of R1 000.

It also give Black workers who until now were considered temporary employees, the right to be appointed in permanent positions after two years of service. This is most welcome.

In many respects the Labour Council will operate in a manner similar to industrial councils although there are significant differences. The Labour Council will consist of one representative of each union and an equal number of representatives of the SATS. Those unions presently recognised by the SATS will have their automatic membership of the council. No union may become party to the council until it has been recognised by the SATS.

I believe this new creation is a historic development insofar as labour relations are concerned. Prof Wiehahn is in total agreement with the Bill and so is the Federation of Trade Unions. The Department of Manpower has also approved the Bill after certain amendments were made at their request.

Finally I want to place on record my very sincere thanks to the chairman of the standing committee, the committee clerk and all the officials of the SATS who assisted us with answers to the various queries raised in the standing committee. From this side of the House I support the Bill.

Mr Chairman, I think the SATS have learnt from their past experiences. It was only last year that there was a disruption in the services and we believe that the disruption of any type of service is not good for the country’s economy as a whole. The results of the strike action last year most certainly caused great concern to the SATS because most of their essential services were brought to a standstill. If one considers the enormous amount of damage that was caused I think one has to take cognisance of the fact that there should be some measure of understanding between employer and employee.

I believe the fault also lies with management when they adopt an “I don’t care” attitude. Similarly the employees sometimes become very adamant, little realising the importance of work and the value of work at the present time. They too begin to adopt an “I don’t care” attitude. This attitude is of no good to the employer or the employee.

This Bill provides for certain matters related to the conditions of service. The employees of the SATS had their own conditions of service in the past and these restrictive conditions became a problem and they tried to find a way of showing their dissatisfaction.

This Bill provides the machinery for greater bargaining power in an orderly manner—this is essential—in respect of salaries and conditions of employment. This Bill gives greater scope for labour disputes and it also creates additional machinery whereby employer and employee will be able to resolve their dispute in a much more amicable manner.

Unfortunately the public sector does not qualify in terms of the Bill to air their view in any court of law. They do not fall under the Labour Relations Act whereby they could take their disputes to the Industrial Court. They are restricted to certain conditions and as such I believe there must be a greater measure of understanding between the employer and the employees.

One important aspect of this Bill has become a matter of concern and I, particularly, was very concerned when it was brought before the standing committee. I voiced my reservations very strongly insofar as clause 21 is concerned. I am pleased to note, however, that there has been some understanding on the part of the Ministry. In his Second Reading speech the hon the Minister indicated that if this Bill with this particular clause is passed by the three Houses it will be referred back to the Labour Council for further discussion and for their viewpoints on clause 21.

I believe this particular clause is not in the best interests of the employer or employee simply because there is absolutely no provision made for any other recourse if a person is frustrated or if the matter cannot be settled by the Labour Council.

The clause itself makes the following provisions, and I should like to read clause 21:

1. (1) No employee or other person shall instigate a strike, or incite any employee to take part in or to continue a strike, and no employee shall take part in a strike or in the continuation of a strike.
2. (2) An employee or other person who contravenes the provisions of subsection (1) shall be guilty of an offence and liable on conviction to a fine not exceeding R1 000 or to imprisonment for a period not exceeding one year or to such imprisonment without the option of a fine or to both such fine and such imprisonment.

I believe this particular clause, Prohibition of Strikes, is a repetition of the past condition that prevailed. It should be looked at in a much more understanding manner.

I believe that if labour disputes cannot be settled by this council people should be given the right to demonstrate their grievances. If they have a cause I do not believe that they should be put into gaol simply because they are striking. If this Labour Council fails to bring about a settlement between management and the employees I can think of no other alternative than going on strike.

In such cases if strikes do occur we do not want a strike because it will certainly bring about a standstill in essential services. However, I am of the opinion that if a reasonable period of notice is given both by employer and employee whereby the employer could understand the employee’s position and vice versa it may be a step in the right direction. If any employee goes on strike without giving such notice he should be dismissed because there are hundreds of people who are looking for employment and these vacancies could be filled.

The provision in this Bill is only in the interest of management. As it stands at the moment they have the right to imprison a person if he goes on strike. I want to put it this way: If 50 000 people had to strike at any one time just because of a grievance, if the matter cannot be resolved by this Labour Council, I should like to know whether we have the time or the accommodation to put 50 000 or 10 000 strikers in gaol? I do not think that that situation has arisen in the past but it may arise. Because there is provision for this in the Bill if an instance of that nature had to come about we are going to have a problem.

I do not think that the employees’ problems could be solved by imprisoning them. It would further add to their social problems which in turn again become the State’s problems.

I am very pleased that the hon the Minister has accepted that this Bill is going to be referred back to the Labour Council after the three Houses have passed it in order for them to go through it and to decide how best they can resolve this. Again, it is going to be a decision by management and by the employees. I am pleased that this matter is going to be resolved by the very council that is going to see to the welfare and well-being of both employer and employee.

With these words I have no objection in supporting the Bill.

Mr Chairman, before I begin with my argument I should like to react to the Chairman of the House of Delegates’ component on the standing committee. He certainly supports this Bill and supports the prohibition of strikes. I can understand that because as a businessman he does not know the plight of the worker. In that respect I recommend …

Mr Chairman, on a point of order: People have said on a number of occasions in this House that the hon member for Camperdown does not understand English.

Mr Chairman, that man is insulting me.

Order! That is not a point of order. The hon member for Camperdown may proceed.

I regard that as a slur against my integrity. I think that hon member is a very stupid member. He does not understand English. I do not think he went to an English school.

Order! The hon member for Umzinto said the hon member for Camperdown did not understand English. However, that is not a slur on the hon member. The hon member for Camperdown stated that the hon member for Umzinto was a stupid member. The hon member for Camperdown must please withdraw his comment.

I bow to your ruling, Mr Chairman, and I withdraw it.

Order! The hon member for Camperdown may proceed.

I would like to rephrase my statement. I do not think that hon member spent enough time in school.

The hon member gave his outright support to the Bill. He said the Bill was a very good Bill and it made provision for imprisoning strikers. What does he mean by that?

I say that because he is a businessman—his father was a businessman and he was a businessman. He does not know the plight of the working-class man. He does not know that the only weapon a working-class man has is strike action.

Be that as it may, I think the hon member for Umzinto perhaps gave the Bill before the House a superficial perusal. It gives the impression that because of the establishment of a formal collective bargaining institution in the form of the labour council, everything is very nice. I also agree that either way we must have a bargaining board where views can be exchanged. That part of the Bill is commendable. I further concede that the Bill embodies other principles, for instance, that there is no discrimination on the grounds of colour, sex or race. That is also welcome.

With regard to salary adjustments, productivity will be taken into consideration. That I also welcome because I know people of colour who are far more productive than Whites. That would be of benefit to the majority of the workers in the SATS.

Another good feature of the Bill is that the chairman of the labour council will be unfettered with regard to both the SATS and the trade unions. He will be a free and impartial man, as is a Supreme Court judge. That provision is laudable.

I want to refer to the conditions of service in the SATS. Conditions of service for employees will be incorporated in a single document known as the Consolidated Service Conditions. I also welcome that provision.

Furthermore, the trade unions that wish to participate on the labour council need not be registered in terms of the Labour Relations Act, and this is also welcome. However, upon deep and profound scrutiny of the Bill, we find there are certain clauses that are not acceptable because they contain matters of profound concern that defeat the purpose of the old exercise of the Bill. I would like to refer to these clauses. The hon member for Havenside dealt with one clause.

In terms of clause 4 of the Bill the labour council has the right to amend the Consolidated Service Conditions.

That being the question, I come to clause 10(11) on page 15 of the Bill. I quote:

Subsection (12) goes on to specify that the membership of a trade union shall be terminated by written notice, formal and explicit withdrawal of recognition, or expulsion.

If, for argument’s sake, the Labour Council were to turn down an application by any trade union, the members of that trade union would not be represented on the Labour Council, which in turn has the right to amend the consolidated service conditions. Perhaps this particular trade union has as its members, let us say, 20% of the employees of the SATS. It is nowhere specified here for what reasons or on what grounds the Labour Council can refuse or deny membership to any particular trade union. That is one of the objections.

I now turn to clause 14, which concerns voting and the manner of arriving at decisions. This is highly irregular. I quote section 14(1):

Let us say for argument’s sake that a labour sector consisting of, say, artisans, sweepers, cleaners, journeymen or whatever, forms a trade union. This means that a trade union representing 50 000 members and one representing 10 000 members, as well as one representing 2 000 members, will have equal voting rights on that council. Is that an equitable distribution of voting powers? This is grossly irregular.

In this very Parliament we have an equitable distribution of power. Because of the almost five million White voters, the House of Assembly has 162 members. We in this House, because we have about 2 000 less than a million people, only have 45 members in this House. We do not grouse about it; it is a fair and equitable distribution of power. Why, then, is that not embodied in this council?

How can a trade union that represents, say, 100 000 workers and one representing say, 10 000, get equal votes on that council? That is highly irregular. The Minister should look into this and try to effect an amendment in this regard.

Clause 18 of this Bill deals with finance. This is a highly irregular and outrageous clause. Every employee of the SATS will be required to contribute a subscription regardless of whether he is represented on that Labour Council or not. However, the benefit flowing from the council only goes to the members who are represented on that council.

In other words, non-represented members have to subsidise those who have representation on that council. I wonder how the hon the Deputy Minister is going to answer that point. Where is the justice in that? Why must an employee who has no representation on that Labour Council and who will not derive any benefit from it until such time as his union is represented, pay in the interim, and in so doing, subsidise those members who have representation on the council? This is grossly irregular, outrageous and discriminatory.

Order!

Something is not in order, Mr Chairman. [Interjections.]

Order! [Interjections.] The hon member for Camperdown may proceed and should not take any notice of orders from other hon members.

Yes, from that man from the north. Thank you, Sir.

Order! I understand that the hon member for Springfield has broken the line. Will the hon member please go back to where he started and then return in terms of the rules of the House.

As the Chair pleases.

Mr Chairman, on a point of order: The hon member for Springfield broke the line in the first place, returned to his seat and then broke it once again. He should be penalised again for this. He has walked the line, now maybe he should walk the plank.

Order! The Chair will overlook that, but the hon member must realise that he did once again break the line.

Thank you, Mr Chairman.

Order! The hon member for Camperdown may continue.

Mr Chairman, in my preamble I made the strong statement that all over the world, including South Africa, the working man has a right to strike. However, clause 21 (1) reads:

This is grossly unfair. This particular clause defeats the entire purpose of this Bill. This is what I call a sugar-coated pill.

What is inside?

Castor oil. [Interjections.]

The hon the Minister could argue that SATS is of strategic value. I would then ask the hon the Minister what about Eskom, Iscor and Sasol. These institutions do not have this blockage of strike action. Then I would ask about the dairies and bakeries—also of strategic value. Yet those industries do not embody such stringent impediments against strike actions. These workmen no longer have a bargaining position and therefore this is not acceptable. I agree with the hon member for Havenside and I commend him for his argument. Furthermore, clause 21(2) reads:

These terms are very harsh.

This clause bears the semblance of a dictatorial or a proletarian system. A fine of R1 000 for a worker who goes on strike is absolutely ridiculous. It is scandalous. It is outrageous. [Interjections.] If one were to consult the records of the SATS I think one would find that not even 50% of its employees are earning R1 000 per month. However, if they go on strike they will be fined R1 000 or imprisoned, or perhaps they may even be both fined and imprisoned. That is highly objectionable, Sir. It is unbecoming of Parliament to pass laws like this.

Good laws.

Somebody said it was a good law. That hon member should try working for the SATS and he will find out. [Interjections.]

Subsection (5) reads as follows:

Once again, this is not acceptable for similar reasons. I know of many, many non-Whites who work in industry and who went on strike not because they wanted to but out of fear. They ran away to the homelands. They do not live at or near their work places. They conveniently get away from the area.

Therefore, affixing a notice at such a person’s work place or communicating it to him verbally is of no effect. He only has three days in which to respond. The man may be hiding in his homeland. If his work place is in Cape Town he may be living somewhere in the Boland out of fear, to get away from trouble. The majority of strikers participate in strikes not because they want to but out of fear. That applies to all races. They could be White, Black or Brown. If a particular person has been compelled to strike through fear, duress or coercion and he leaves his place of work and goes to stay in another town, then serving three days’ notice on a notice board at his fixed place of work or at the place where he signs on, is of no effect. They might as well say that no notice shall be given, because that is what it amounts to. That period of notice should be extended to at least 21 days and not three days, or 72 hours.

In some cases a wretched soul may have left a strike area such as Durban and be on his way to Dundee, for instance, in his homeland. Before he reaches home his notice period of three days will have expired. That is grossly unjust.

Strictly speaking, I should oppose this Bill but my party caucus has decided that I should not oppose it. At the same time, however, I shall not support it.

Mr Chairman, the South African Transport Services commissioned Prof Wiehahn to look into the question of various disputes and other labour-related matters and, as a result of the report of his findings the South African Transport Services Conditions of Service Bill has made its appearance.

This Bill is very important as far as the entire South African transport organisation is concerned. The report itself makes provision for the establishment of a labour council. I quote from clauses 8(2) and 8(3) of the Bill:

1. (2) The objectives of the Labour Council shall be—
   1. (a) the maintenance and promotion of labour peace; and
   2. (b) the prevention of labour disputes.
2. (3) The functions of the Labour Council in pursuance of its objectives shall be—
   1. (a) collective bargaining and the conclusion of agreements as referred to in section 15 …

Before the Bill was introduced, the SATS consulted all trade unions which have some relationship with employees of the SATS. Practically each of the trade unions agreed to the formation of such a labour council.

The Labour Council will have various important functions. One of its important functions will be to deal with various matters relating to disputes, mediation, arbitration and matters of that nature. I quote from clause 8(7) of the Bill:

The Labour Council itself will put forward an annual report to the hon the Minister of Transport Services on all its activities throughout the year. This report will be tabled in Parliament so that Parliament may have a general view of all the functions and activities of this council.

Hon members who attended the standing committee meetings reported fairly favourably on some of the provisions of the Bill. Most important is the composition of the Labour Council. The Labour Council shall have a chairman who shall be appointed by the hon the Minister and he shall not have a vote. Other members will be able to vote. I quote from clauses 10(8)-(10) of the Bill:

1. (8) The members of the Labour Council shall consist of the South African Transport Services and the trade unions that were officially recognised by the South African Transport Services on the day before the operative date of this Act.
2. (9) The representatives of the South African Transport Services on the Labour Council shall be appointed by the South African Transport Services.
3. (10) The representatives of the trade unions on the Labour Council shall be appointed by the trade unions.

Therefore representatives of employees and employers will sit on this same Labour Council.

There are various other issues. I quote from the section on the constitution of the Labour Council:

Therefore, even the constitution of this organisation shall contain powers to ensure that consensus may be reached between members of the trade unions and the management. Therefore, when this body comes into operation it will represent both the employer and the employee.

In the case of a dispute between the employer and the employee this body will play a major role in looking into all the aspects of the dispute or any unrest in the SATS and bring about some settlement.

Provision has also been made for the question of disciplinary action. Provision has been made for the matter mentioned by the hon member for Havenside and I think it was discussed in full.

Both Dr Coetzee, who is the Deputy General Manager of the SATS, and Mr Moolman were largely responsible for this Bill. They did extensive work including the necessary explanations and consultations before the Bill was brought before the standing committee. The members of the standing committee had extensive discussions on the Bill and suitable amendments were introduced where necessary. In view of the importance of this Bill this side of the House has pleasure in supporting it.

Mr Chairman, this Bill was discussed at great length in the standing committee and many enquiries were made with regard to certain clauses. I wish to look at three aspects of the Bill. The first is the manager’s powers of delegation, the second is the establishment of the Labour Council and the third is strikes.

The determination of the powers of the Minister and the general manager was questioned extensively. It was evident that the general manager could delegate powers to anybody down the line of management. The delegation of power was so wide that it appeared as though the power could be delegated even to the tea boy.

I want to quote from the summary of the 10 recognised trade unions’ comments on the Bill as follows:

We questioned this in the standing committee. The general manager as well as the legal adviser then explained that the clause as stated was necessary to delegate powers. They said that the SATS was a mammoth organisation and this being so, there was a need for the delegation of powers to different persons in the hierarchy. The general manager assured us that power would be delegated to responsible persons in a responsible manner and that such delegated powers may not be abused. We were quite satisfied with that answer and there was no further fear that powers would be abused.

The establishment of the Labour Council is most welcome. This body comprises of an equal number of members from two participating bodies, namely the management of the SATS on the one hand and the represented trade unions on the other. Any disputes concerning conditions of service, wages or labour can be thrashed out here in a democratic manner. It is a forum for collective bargaining and it affords opportunities for free debate and discussion on issues affecting both the employer and the employee. The establishment of the Labour Council affords greater scope for collective bargaining than representation through individual staff associations and substitutes who may be suspect in their representations and bargaining.

Very few employers prefer the trade unions nowadays. The trade unions enjoy certain prerogatives, can dictate terms and act on certain unscrupulous employers who may exploit the workers. A major step in the labour relations in South Africa was the recognition of trade unions.

During the past few years the unions have grown into huge organisations. The Department of Manpower is aware of this growth and has recognised the unions as representative bodies. I believe the unions have the right to make forthright representations and that employers should consider these representations in the light in which they were made without any prejudice.

I should like to mention that we cannot claim that all is well in the employment field in this country. We have diverse problems.

Representation by unions must be considered with mutual understanding to resolve workers’ problems and disputes. If decisions impinge on political issues and political policies the unions deserve the right to question such a policy. This is a very important point because we may run into certain problems where we cannot even challenge the Labour Council. Here I want to mention clause 21. I received a friendly note from the Ministry in this regard and I shall come back to it.

Political representation should be left to the politicians and the unions have concerned people who are interested in their welfare. I want to mention the fact that in the reform process in South Africa we have avenues through which certain representation could be made to parliamentarians.

I can certainly give them the assurance that I would be prepared to make representations on their behalf to Parliament, or to the Minister, to change that policy if necessary. I am sure the Labour Council will sort out the problems that may exist.

I now want to come to the strikes. I understand full well the concern certain hon members feel about strike action and the prohibition thereof and I want to quote:

This is nothing new. I think we need to protect essential services in this country and the SATS, as a Government institution, has the right to do so.

Now that we have this Labour Council I am more than confident that problems can be sorted out, but people who resort to some other means may have some other motivation for calling a strike; for example, if they are politically motivated to damage the economy or even desire to overthrow the State or the existing order then there is an ulterior motive. As far as the welfare of the workers is concerned I am all in favour of the establishment of the Labour Council as a forum for negotiation.

Mr Chairman, I want to start off by thanking hon members for the contributions they made in this debate. I do appreciate the general support given to this piece of legislation.

I am going to deal with individual members and then I shall make a few general remarks with regard to this particular piece of legislation.

I should like to start off with the hon member for Umzinto. I wish to thank him for his support. He has to a large extent outlined the background that gave rise to the introduction of this Bill and mentioned the Wiehahn Commission and what the Bill entails.

The hon member for Havenside, who is also a member of the standing committee, made the point that one should not have disruption of services. He expressed the hope that there would at all times be good relations between management and the work force. I cannot agree with him more because I think the main objective of this Bill is to ensure that, if humanly possible, there will be good relations between management and the work force at all times.

The hon member also indicated that he supported the greater scope for labour disputes, which can be solved in this fashion according to the provisions of this Bill. I thank him for that remark. However, he also had an objection to clause 21, which he admitted. I think it should be placed on record that this is not a new clause but a repetition of what we have had before. As far as the strike clause is concerned, however, the hon member will have to pardon me for a while because I am going to discuss that matter in general.

The hon member for Camperdown made a point about the Labour Council and agreed that the establishment of this council was a commendable feature. He also mentioned that no discrimination was going to be allowed. I think that is often overlooked because we are all concerned about the issue of discrimination. Here is a good example of the way we are moving away from discrimination on the basis of race, colour or sex. I am glad the hon member found this unobjectionable.

The hon member for Camperdown made quite an argument of clause 4, the question of unequal representation of membership and matters relating to finance. I would like to reply to the hon member by saying that at more or less the time of the Wiehahn Commission there were in the region of 155 000 members of the various trade unions, some of them large, and some of them smaller. The hon member therefore does have point when it comes to the payment of fees. These will not amount to more than about R1 per employee per annum; it will not run into millions. One should bear in mind that the Labour Council will have expenses and it has a job to do. The SATS itself will of course also make its contribution so it will not only be the employees that will be paying, but management as well. The SATS will make its contribution towards the upkeep and the administrative costs involved in the Labour Council and the work in general with regard to the improvement of labour relations.

The hon member is not here at the moment as far as I can see. However, I am sure someone will tell the hon member. I do appreciate that this is a point he argued about so I am replying to him in full. He also asked why people that were not members of a trade union should pay. It is because they are going to benefit from the good things this Labour Council is going to do. Its objective will be to improve conditions of service, salaries and medical aid, and to organise all kinds of concessions with management and the SATS.

Surely, therefore, since they are going to benefit, I think they should also pay. This is not an unreasonable step, and as I have already indicated, R1 per annum per employee is not the fee that one would pay to become a member of a club. Certainly this step would mean a great deal to all the employees of SATS.

I want to reply to the other point made by the hon member. He asked why each trade union member of the Labour Council is allotted only one vote, irrespective of the size of its membership. Before a trade union is recognised, thereby qualifying for Labour Council membership, such a union will by necessary implication already have a substantial number of members. It was considered to be in accordance with the democratic principles which often apply to representative bodies that each trade union member should have an equal say on the Labour Council and that smaller unions—this is the point—should not be unfairly dominated by unions which might have far more members but less know-how than others. Equal voting power among unions will also act as a safeguard against unnecessary interunion strife and improper intimidation.

The hon member made the point that in this Parliament the House of Assembly consists of 178 members, while this House consists of only 45 members. However, we should consider the matter of constituencies. I represent close on 22 000 voters, while others only represent 8 000. Thus that, too, is a factor in our democratic institutions. There are some members here who have constituencies consisting of a very large number of voters, while others have smaller constituencies. However, one would not suggest that because I have approximately 20 000 voters, I should have more say in Parliament than my colleague who represents a constituency such as Prieska, with only 8 000 or 9 000 voters. I think that the principle here is a very important one, which is that one’s bigger trade unions should not dominate the smaller ones.

I think that in general I have now replied to the individual questions raised by the hon member for Camperdown.

In his remarks the hon member Mr Thaver quite clearly supported this Bill. He also made the point that the constitution can be amended. As far as the good features are concerned, I think that if hon members are sincere in their approach to this, they will agree with me that the good qualities of this Bill far outweigh the few objections that they have. The hon member also made the point that the Labour Council will be responsible to the Minister—that is an important feature of this Bill.

The hon member for Merebank dealt, on the whole, with the three issues of the delegation of power, the Labour Council and with strikes.

As far as the delegation of power is concerned, I think one must agree that when one has a big organisation like SATS, which has approximately 194 000 employees, it is imperative that one should delegate power. However, the important point is where the delegation starts.

The delegation starts with the State President, who has the power and who appoints the general manager. Then the Minister appoints the deputies and the assistant general managers. The general manager in turn delegates his authority and makes the appointments lower down. Looking at this organisation one can compare it to a pyramid, starting from the top and going downwards. However, I think it is an exaggeration to think that one can eventually have a situation where a lot of power is given to the tea boy. That may be stretching it a bit far and I do believe that the hon member has a vivid imagination. I appreciate that imagination, but it is taking it a bit too far to say that the tea boy will have authority, for example, to deal with any issue of SATS apart from making the tea. I have no reason to believe that by delegation of power one will promote the abuse of that power. The principle on which this hinges is in fact that the higher authority will see to it that the authorities lower down will not abuse their power. In the past this has proved to be a very successful way of dealing with the situation in SATS and there is no reason to believe that this will change or that things will go too far. One should have appreciation, however, for the point that the hon member made about the protection of essential services.

I now once again address the problem of strikes. Perhaps I should also indicate to the hon member for Camperdown that Eskom and Iscor are corporations with legal personalities, whereas SATS is part of the State and is therefore without legal personality. The Labour Relations Act is not applicable to employees of the State, such as SATS employees. My information, after taking another good look at the Wiehahn Report, is that as far as the Labour Relations Act of 1956 is concerned, Eskom is excluded. However, because it is a supplier of essential services, its workers are not allowed to go on strike.

Order! I do not mind hon members conversing with one another, but far too many conversations are taking place and too little attention is being paid to the hon the Deputy Minister’s reply. I appeal to hon members to pay attention. The hon the Deputy Minister may proceed.

Thank you, Sir. My point is that the hon member’s information is wrong in suggesting that Eskom employees have the right to go on strike.

Mr Chairman, I wish to conclude by saying, in general, that I am pleased that we have reached this final stage in the adoption of this Bill. Today is the final hurdle and I am very grateful. I wish to repeat that I am very grateful for the support given, also in this House. Many members, also in the other two Houses, have expounded the good qualities of this legislation. I must say that the objections to the Bill were qualified and not of a generally significant nature. Hon members have had their objections to clause 21 and again this is a repetition of what passed before.

In the Second Reading speech we indicated that the Labour Council will be able to review the whole situation and that if they are not satisfied with it, they may come forward with suggestions if they do not feel there is enough recourse for the workers in South Africa. Once certain decisions have been taken by the Labour Council it will be up to the Labour Council, on which the trade unionists will have their representation, to take a good look at what clause 21 entails. However, I should like to say that in view of what we have accomplished by way of this Bill, having effected quite an improvement over the situation that prevailed previously, I think we should surely also have a right to protect the essential services in South Africa.

At the same time, with regard to people being intimidated, we came forward with some amendments last year. That is why they now have three days to respond once they have seen the notification. After all, people could have a perfectly valid explanation in that they have been intimidated, in which case they will not be prosecuted, as we indicated last year.

I believe this Bill is a product of consensus seeking and that we have succeeded in elevating the true interests of SATS employees to a platform of real collective bargaining. For many years our trade unions were not altogether satisfied with the old system of determining improvements in their pay packets and other service conditions. All of these unions went through an evolutionary process.

In his report prof Wiehahn, when dealing with the historical development of trade unionism within the SATS, made it quite plain that after 1910 there were, at first, a whole host of unions. This caused a great deal of strife and labour unrest. Gradually, however, a redivision of staff representation took place, especially in the year 1941, and a consulting committee was subsequently established. The individual trade unions were always jealous of their right to deal directly with the SATS, obviously in order to deal with those issues which affected their particular members.

Then the Federation of Trade Unions came into being. It did not seek merely to fulfil the role of an umbrella organisation, but rather to play a role in negotiation as well. This is how the present bargaining procedure developed. The decisionmaking power is vested in the Minister but it could also go higher, to the State President and the Cabinet and eventually to Parliament.

Over a period of decades and through a process of negotiation, the trade unions on the one hand and the Minister and management on the other developed a method of determining what should, in the first instance, be cleared by the Minister, and those service conditions which had to be decided upon by management. This delimitation or demarcation of duties was not always clearly visible and did not always rest on a firm foundation. Therefore, the present service conditions did not come about—and I want to stress this point—in a one-sided manner; nor can it be denied that the trade unions in the SATS played a significant role, through negotiation, in determining the present service conditions.

I want to pay tribute to them for the role they have played in this regard.

Since we are entering a new period in which the SATS will not only be divided into suitable business enterprises, but will make profit and pay tax as well, I believe that we now also need a new structure to determine the real needs of our labour force. The proposed Labour Council and the many other provisions of this legislation will be able to do just that. This legislation is moving closer to the approach to labour we find in the private sector. It is not the same, but we are moving in that direction. It also still recognises the special character of the SATS. However, the emphasis is on the promotion of labour peace and the prevention of labour disputes.

Negotiations to improve conditions of service are taking place in a spirit of goodwill. I think this has served us well up to now. However, it was not real collective bargaining. New demands and changes in the role to be played by the SATS in a deregulated world necessitate the creation of a new image for the SATS. It will move away from the old-fashioned national carrier image. It was usually just regarded as a State business undertaking. Therefore also in labour relations and in creating the machinery for better labour relations, it must be seen to be entering the competitive commercial world.

A most encouraging feature of the debate on this Bill has been the unanimity. All parties have accepted it, including—and this is quite significant—the CP, in spite of their inherent dislike of anything that is multiracial. The Labour Council will be a multiracial body. Management, and closed, open, White and Black, trade unions, will all have representation. Common interests—and this is important—and economic interdependence amongst all racial groups must keep the wheels of the SATS going and keep our planes flying.

I believe labour peace will ensure an increase in productivity and this in turn will ensure greater profitability. By giving the consumer and the user a good service at competitive prices, we will ensure a place for the SATS in the transport field.

This is the direction in which we are moving. The labour force of the SATS, with a new bargaining structure as their vehicle, can from now on combine with management in a strong and effective partnership. This partnership must ensure for us the desired productivity and profitability.

Question agreed to.

Bill read a second time.

Mr Chairman, I move:

Agreed to.