When I addressed this House yesterday afternoon I said there was much in the budget I could commend and a little I could offer in the way of criticism. I want to say this afternoon that if my remarks are concentrated on the side of criticism, that is only due to the fact that I feel that constructive criticism—if my criticism is constructive—is likely to be of far more service to the Minister of Finance than the taking up of the time of the House in commending those proposals which merit commendation. The whole basis of this budget is the new monetary position created as a result of the departure of the Union from the gold standard. Some of us may disagree with the Minister, regarding the remarks in his speech in respect of the right of the State to appropriate any profits that may be made by an industry as the result of the Union going off gold. You will recollect that the Minister stated in his speech that South Africa’s departure from the gold standard and the subsequent depreciation of our currency, had had the effect of increasing the value of the output of the gold mines by many millions. He said that this is an increment due solely to State action, and that it is maintained by State action under the Currency and Exchanges Act, and is in no wise an appreciation of the assets of the shareholders. If I may say so, that statement stands as rather definite contradiction to the statement which appears in the white paper with respect to the farmers, which reads as follows—

I notice that when this depreciation of the pound applies to the mines, it is said to automatically benefit the State, but there is no suggestion that it benefits anyone but the farmers when it applies to the farmers. The farmers are going to receive the whole increment on the prices of their commodities as well as the larger part of the increment which accrues from the gold mines. I have no objection to the farmers getting a portion of the increment, but I would like to know whether the same principle is to be applied to the coal mines and the copper mines as is applied to the gold mines, because, if so it will certainly be a serious hardship to these mines, which have been struggling against adverse circumstances for the past 18 months. I do not intend to deal at length with the mining point of view regarding the budget proposals, as there are other members of the House who are able to deal with that point of view with far greater knowledge and in far greater detail than I can possibly do. I would, however, like to call the Minister’s attention to one or two aspects of this. I notice that this morning there has been an alarming break in prices on the share market on the Rand. One can only hope that this first opinion of the gold mining people as to the value of their stocks will be revised on fuller knowledge of what they mean. I also think that it does seem to me very unfair to the industry, which employs, I suppose, the best engineers that the world can supply, that in future it will not be allowed to undertake any development work except with the approval of the Government Mining Engineer. There is always room amongst experts, particularly amongst expert engineers, for legitimate differences of opinion, and I think it is unfortunate that the Government should place their engineer in a rather false position with regard to mining policy, which should be left to the engineers employed by the mines themselves. I also think it a legitimate criticism that might be levelled against the Minister’s proposals that in respect of any further increment of the premium the mines have really no interest at all, the whole of that increment going to the State. I would like to say a word with regard to the premium itself. The premium is admittedly a very large reservoir of wealth which can be used for the benefit of the people of this country as a whole. I notice that the Minister of the Interior the other day, referring to this, regarded the premium as enabling us to go a long way towards safeguarding the interests of our civilisation in South Africa, and in that connection extending the life of the gold mining industry on which we are so much depending. That is a very fair statement. Let me, however, say that I do not agree with the view that the wealth accruing to the mines as a result of the gold mining premium is accruing to them at the expense of the rest of the population. I should be surprised myself if the Acting Minister subscribes to that view. I also think that the Minister is wrong when he refers, in this connection, to our depreciated pound. I think if we are to refer to the depreciated pound in South Africa we should be little more accurate. Our pound has not depreciated except in terms of gold, because in other respects our pound has not depreciated. It is absurd for the Minister of Finance to talk about our depreciated pound, and for the Minister of Railways to tell the mine and railway workers that the pound has not depreciated, and consequently they are not entitled to more wages. I hope that in future we shall talk about the pound as not being a depreciated pound, but only as being depreciated in terms of gold. Regarding the question of the premium, the Minister, accepting the premium as a source of wealth derived from the people of this country, takes the perfectly correct attitude on that assumption that as the gold mines are getting all this, he must take a large proportion of it from the gold mines, and, as he terms it, re-distribute it amongst the people of the country. I think that is an unfortunate view, because if they pursue it there will always be a section of the poor and needy people in an expectant attitude desiring to obtain for themselves a portion of this wealth which in reality belongs to the whole people. When an industry benefits, not only it and all its allied industries will also benefit, and I suggest that the best way to use that reservoir of wealth productively is to put this money back into the ground, in order to enable the mines to work lower grade ore, and in this way to extend the operations of the industry. That seems to me a very much better scheme than taking a large proportion of that reservoir of wealth, of that premium, and placing it into what is nothing more or less than the coffers of the trust companies and the land banks. That is the best way to freeze any wealth you have, whereas if you take this £20,000,000 and put it into the ground, and compel the mines, if need be, to work low-grade ore, that £20,000,000 after it has passed through the wage-earners’ pockets, and the store-keepers’ hands, through the hands of commerce and industry, and through the hands of the farmers, and through the hands of the taxpayers, will represent not £20,000,000 of accrued wealth to this country, but something more nearly approaching £120,000,000. Anybody knows that wealth used productively fructifies by every stage through which it passes. If the premium is used in that way there is no doubt about it that our farmers’ problem and the problem of unemployment, will, to a large extent, solve themselves. I want to be quite fair to the Government and to the Minister. I recognize that the Minister has gone a considerable extent in this direction, and I also recognize that even if he had left this £20,000,000 to be put underground on this occasion it would have been impossible for the mines to do it, because you cannot employ £20,000,000 underground in the way I have suggested without extending the scale of operations very considerably, which would mean extending your capital, purchasing new machinery and opening up new areas. We recognize that it takes time to do this. The point I want to make is: it would be better for the Government rather than that it should continue to take a large proportion of this sum each year to help the farmers and others, they should say to the gold mines that, provided you extend your operations and your capital and employ more people, you will get not one half, but the whole of this premium for this purpose, because it will be the most productive and the best way of using the premium. Instead of that you say this premium is the property of the State, and you take half of it by right this year and next year you may take the lot because you say it belongs to the State. Now I would like to say a word with regard to the question of unemployment and the provision made in the budget in respect of this. I feel that I must confess to some measure of disappointment that a little more has not been done in rgeard to this provision for unemployment. Actually on account of revenue the sum of £145,000 is all that is allocated for the unemployed. Well, I can assure the Government that I would have no difficulty in spending that sum in my own constituency at the present time, and I think, when the gold premium is being distributed with such a generous hand in some directions, that perhaps there might be a more generous distribution of this among the unemployed, which would have been appreciated in many urban areas, and amongst those who know about this problem. The Minister claims he is spending £1,000,000 on the railways to help unemployment, but the fact that they are spending £1,000.000 this year on these works will not, in my opinion, relieve the position at all. They spend £1,000,000 or more every year on capital works. Therefore I hope that the Government will give real consideration to the people who are unemployed in urban areas. I would like to say a word with regard to the proposals which have been advanced with regard to farmers’ relief. The only point of criticism that I have to advance with regard to the proposals to grant relief to farmers is in connection with the question of the rate of interest chargeable on bonds, and that is that I think this proposal is on the whole rather crudely conceived. It does seem to me that a large number of people are to be assisted under that scheme who do not require assistance and that those who do require assistance will not get any relief worth speaking about. If the condition of the drought-stricken farmers in the Orange Free State is anything like as bad as I am told it is, then I would suggest that paying one and a half per cent. on any bond on which they have to pay a hypothetical interest will not help them at all. On the other hand, there are large numbers of farmers who are quite capable of paying five per cent. interest, and I do not see why the taxpayer should be called upon to pay one and a half per cent. in such cases. According to the “Cape Times” the other day it was stated that 60 per cent. of our farmers of this present time are able to meet their indebtedness, 30 per cent. could do so with assistance and that only 10 per cent. were in a hopeless position. Well, ten per cent. of those in any industry at any time are in a hopeless position. The fact is that if ten per cent. of the farmers cannot meet their liabilities that is a more or less normal state of affairs. The point is this, that in order to meet the payments of these 60 per cent. of the farmers who can pay, the assistance which we can give to the 30 per cent. to whom we should give assistance is, in my opinion, wholly inadequate. I do not know whether it is possible for the Government to reconsider its proposals at this stage; but let me say that we should concentrate on assisting those in real need and give such assistance, with all the generosity the State is capable of. I am told that the fruit farmers in the Cape are not in a bad position and that the wool farmers are not so badly off. I think the farmer is rather like the business man. I have never known any business man yet who had had anything but a bad year when asked what business was like. However, the principle is there, and we are assisting a lot of people who do not require assistance. I suggest that paying 1½ per cent. of the hypothetical interest which the poor drought-stricken farmer is paying at present, is not going to help him one iota. There are, of course, other aspects of the question which call for consideration by the Minister. I think there are about twenty different ways of using a bond. I would like to call the attention of the Minister to the case of the farmer who borrows money from a bank by way of overdraft, and offers a bond as collateral security. He pays on this bank rate of interest. The overdraft has no direct connection with that loan at all. He is probably paying about 8 per cent. on that overdraft. Under the present scheme, that farmer is going to continue paying 8 per cent.

No.

I am glad to be assured that he is not, but there is nothing in the white paper or in the Bill, so far as I know, which governs that particular point. You are only going to allow 5 per cent. interest on bonds, and you are going to pay 1½ per cent. on that 5 per cent. Very well, in the case of a bank overdraft the money is not lent on bond at all it is lent by way of overdraft, and the bond is mere collateral security. The interest will be the bank’s rate of interest, as provided for in the overdraft arrangements, and J do not see how that farmer is going to be helped. Is the Minister going to have the courage to tell the banks that overdrafts must be granted at an interest of 5 per cent.? If so, and if he will apply it to the urban areas as well, he will have the gratitude of every commercial man in the House, but I do not think that is contemplated. There is also the farmer who borrows money from a storekeeper. The storekeeper takes a bond from him, and, in due course, it may be ceded by the storekeeper to someone else for financial assistance. In a ease like that, the farmer will presumably get 1½ per cent., paid off the bond interest, but what about the poor storekeeper? Is he going to be saddled with the responsibility for helping the farmer? On the general question of dealing with interest in the way the Minister is doing, while one might be prepared to agree with that as an emergency measure, in these difficult times, it is, on the whole, unsound to interfere in any way with the law of supply and demand in respect of money rates. It is true this only applies to old mortgages, and the Government has done a wise thing in not interfering with new business, but although it only applies to old mortgages, it is bound to have an effect on new ones, and to have repercussions in urban areas. The effect will, undoubtedly be that the bond rate will come down to 5 per cent. in urban areas, as well as in rural areas. Let the farmers remember this: The one thing they want to-day is increased commodity prices, and the one way not to get that is to start lowering the rates of interest. You cannot have it both ways. Let the farmer be under no misapprehension about that. Another thing the Minister must remember is this: That all bords are long-term contracts. If I enter into a bond to-day at 5 per cent., it is presumably for five years, but if the London Conference is a success, and we all hope it is going to be successful, if our Ministers achieve what they are setting out to achieve, and there is any revival of trade in Europe and America, then money rates will certainly stiffen and a 5 per cent. bond entered into to-day may be wholly unremunerative twelve months hence. Will the Government have the courage to come to the House in that case, and pass a Bill increasing the rate by I per cent.? I am afraid not. Í agree that these things have to be done in an emergency, but the less the Government interferes with the legitimate operations of finance the better, because we shall have repercussions which no-one can foresee. In regard to the proposals which have been made to help the farmers in various other ways, I am not going to speak at any length, but I should just like to touch on one thing, and that is the proposal to pay half the railage on cattle to urban centres when it is over 5s. The proposal here is that whenever a farmer nuts a number of cows on to the railway, and senrs them to Johannesburg, if the railage is more than 5s., the Government will pay half that difference. Under this heading the Government proposes to pay £150,000. The immediate effect, of course, will be to lower the price of cattle in every urban market, because it will immediately glut the market. In Johannesburg, in order to prevent that, they have appointed a committee which is going to ration the supply to Johannesburg. That, in effect, means this: that the farmer situated close to Johannesburg will have to give up some of his supply in order to let farmers living at a distance get in under the ration scheme. The Government is paying £150,000, and, therefore, the farmers, paying the other half, must pay £150,000 also, so it means that the farmers must pay £150,000 more to the railways for landing the same number of cattle in Johannesburg. If any economist can show me how that will help the farmers, I shall be glad to hear it. There is another aspect of this form of relief which I would, in all seriousness, put to the Minister, and that is that I think it would be very unfortunate if the idea gets abroad that the farmer is to be helped by creating an artificial shortage of supply in our urban markets. I do not think that is the right way to help the farmer. I am afraid the effect of this scheme will be that it will not be the best farmer and the best meat that will dictate the price. If a farmer buys a farm near Johannesburg, he probably pays a lot of money for it, and also spends a lot on improvements, but it will not be he who will dictate the price, but the farmer growing the scrubbiest cattle under the cheapest possible conditions. It means that those who could take advantage of the geographical position are compelled to sell at a loss to meet the competition of those who compete under the cheapest possible conditions. I do not wish to exceed the time that is allotted to me, and therefore I would only like to say one word about the railways. I wish to congratulate the Minister on the way in which he is facing the present position. I find in discussing this question of the railways with people that we have what I might term too much of the civil service complex in regard to our outlook on railway matters. I hear on every hand talk about this “tremendous deficit” which the railways have of approximately three and a half millions. If people would only stop regarding the railways as a political machine, if they would only stop looking at it as a revenue-earning department of the State, if they would only look at it as a business concern—they would have a different outlook. If people could point to my business which in the last three years of unexampled depression, in a time when it was impossible for any business to pay its way— if they could point to any business which during those years, had had a turnover of 75 millions and only had a deficit of three and a half millions, they would say that such a business had by no means done badly. During the past three years our railways have paid in interest—and in the case of the railways interest is equivalent to dividends no less than 18 millions, and of that the railways actually earned 14½ millions. That is what they earned by way of dividends. If our railways were run as a private business concern, what the railways would have done would have been that they would have reduced their dividends from 5 per cent. to 3½ per cent., and in that case there would not have been any deficit at all. Furthermore, if our railways had been able to borrow capital in the past, as I hope they will be able to in the future, at 3½ per cent.—and let me express the hope that the Minister of Railways will sec to it that whenever any money is borrowed at 3½ per cent., whenever there are conversion loans at 3½ per cent.—that he will see to it that the railways are credited with their portion. Had that been done there would not have been any deficit during the past three years. I am emphasizing that because it is important. People should realize that the railways are a business concern and that they should be looked upon as a business concern, and let me say at once that the Minister’s budget statement, so far as it goes, has recognized that. I would just like to sav a word about the proposed commission which the Minister has outlined here. The only thing I would like to say is that it is an excellent move which I think will be heartily endorsed by every section, but I would raise this as a criticism, that I think it would be a mistake to appoint a commission consisting only of overseas men. I do not believe that in this country you would have difficulty in getting one or two men, even in commerce, who are capable of taking an impartial view of the situation. The objection to appointing only overseas men is this: that while those men may be great railway experts and may possibly make excellent recommendations, there is the danger that some of these recommendations may be at variance with public opinion in this country, so that they would be shelved and nothing would be done. If they have the guidance of at least two men of this country, one representing the trading and industrial interests, and one representing the workers, to guide them in regard to public opinion in this country, to enlighten them as to what public opinion will stand for and what it will not stand for, it would be a most excellent thing. It is quite conceivable that this commission may say, for instance: “You should not have Slate control of your railways, you must hand it over to private control.” You do not want to bring men 6,000 miles to come and tell you that, because the moment they come and tell you that, you would say to them: “Thank you very much, here are your fees, you can go back.” That is the danger of appointing a commission of overseas men, so I suggest that the Minister might consider the appointment together with these men of at least two representatives from South Africa. I agree that they should not be politicians. Anyone tarred with the political brush should not be appointed but, apart from that, I think that might be done. I want to conclude by saying that, in spite of the drastic budget which we have to face, I am satisfied that the position of this country as indicated by these statements is entirely sound. I am satisfied also that as far as matters are concerned, although we may criticize some 01 the proposals, this House will unanimously adopt what has been suggested.

I got a shock of disappointment from the hon. member who has just sat down in his closing phrases. He looked towards me with, I thought, a kindly gleam when he was apparently trying to draw me with his appeal that we should have added to his railway commission two South African representatives, one of whom should represent the labour interests. But he dashed my hopes at once by saying that they must not be tarred with the political brush. Now my support at once is not forthcoming, and my hon. friend I fear is ploughing a lonely furrow. In my opening remarks I am afraid it will be necessary for me to draw attention in the most formal public and official manner possible, namely, on the floor of this House, to the fact that we, however small we may be in numbers, are definitely and emphatically opposed to the Government.

Don’t say so.

And as such we must be regarded as differing from them entirely. I hear the unthinking laugh, and of course the volume of sound is great—I hear the unthinking smiling rather loudly at that remark of mine, but the people outside—who after all are even more important than the gigantic intellects in front of me and behind me—are laughing at another situation. Not only are they laughing but their laughter is liable to turn into expressions of disgust at the extraordinary claim by the Prime Minister that because there is a pact between the Nationalists of the former Government, and the South African party of the former Opposition, they still maintain those relations towards each other, and that the Nationalists are still the Government and that the South African party are still the Opposition. I say that that is an absurd claim, and that it is reducing the proceedings of Parliament to very little short of a farce. The people outside are laughing at us. Hon. members here laughed at a statement I made that we are in opposition, and in order that I may further excite their risible faculties, I will outline who this opposition is so that you, sir, will not be under any further delusion and will have no difficulty in calling upon the Opposition when it desires to address this House. There are two Devolutionists; one is rather somnolent for the moment; however, it is but a temporary sleep, and people do wake up, and he, together with his wakeful comrade, will assist us to improve the position here in Parliament very much to the interest of the people outside. I will mention their names—Mr. Sutton and Mr. Derbyshire—

The hon. member must not refer to hon. members by their names. The hon. member must follow the usual practice of this House.

In addition to the two Devolutionists, there are the two Roosites.

They are not asleep.

They are not asleep, and it is not necessary to mention their names. Then there are my friends the hon. member for Durban (Umbilo) (Col. McArthur) and myself, representing the South African. Labour party. Now, Mr. Speaker, you know who the Opposition are. I fear you have overlooked the fact. Now I want to express the most intense disappointment at the general and the railway budget—disappointment not personal, but as representing the people outside. Here we have, for the first time, initiated with a flourish of trumpets, the combination of these two parties, the Nationalist and the South African parties; here you have a monstrous mass—a mountain, I will not say of flesh, and I cannot truthfully say of intellect, but a combination monstrous in its effect, and groaning and expressing itself in painful terms, showing to the world its effort at travail and bringing forth one miserable little rodent of a budget. So far as the people of this country are concerned, I have the right to express the utmost disappointment over the budget, because the people were looking, judging from the manner in which this budget was heralded, for some amelioration of their condition. The unemployed were looking for some opportunity of earning a livelihood, and the starving children were hoping that at last they were going to get food. I see no signs evidenced in this budget, however, of any determination or any idea of giving effect to the tremendous promises made by the Nationalist and South African party only a few short weeks ago.

That is your idea.

It is not my idea. I am talking of facts. The hon. member for Stamford Hill is, geographically speaking, bobbing about the House; he changes his convictions in the directions his interests seem to lie. I beg my hon. friend’s pardon for even so unwittingly associating him, even geographically, with the hon. member for Durban (County) (Mr. Eaton). I only heard a voice when the interjection was made—there was nothing else in evidence. My hon. friend says he has been waiting for my ideas; he has had them all through the years, and has been pleased to express his approval of those ideas, but he changes his ideas just as his interests seem to serve. So when he interjects: “Let us have your idea,” he is hypocritical and he knows it. I hope he is not going to keep on interrupting on the lines we have learned to expect from the hon. gentleman. I will put him out of his misery at once as to what we propose, and I think that if he is consistent he will support us. What we propose will take the form of an amendment, which I am perfectly certain he will support even at the risk of being thrown out of the South African party caucus.

If it is sound and not hypocritical.

It is very appropriate that the hon. gentleman should talk about hypocrisy. Before I put the hon. member out of his misery, I wish to draw attention to the enormity of the iniquities of the Minister of Finance—of course, I am not accusing him personally. His view of the way in which the finances of the Government should be dealt with and mine, are diametrically opposed; he honestly holds his ideas, and I honestly hold mine. So, if there are two men in this House who honestly believe in what they are preaching, he is one and I am the other; I respect his convictions, as I expect him to respect mine. In this budget there has been not an item in the way of the lightening of the taxation on any section of the population, save one, and in that instance the Minister put it on again. That refers to the poor unfortunate income tax payer. It seems strange to hear me pleading for the income tax payer, and the hon. member for Durban (County) need not fear that I include him in the category, for he is rather above the limit. I refer to the poor unfortunate income tax payer who is hovering on the border line of exemption, and receives no help at all from the budget. Despite the fact that we have a veritable windfall in the shape of over £20,000,000 in South African currency, despite that fact the Minister of Finance has not seized the opportunity of lightening the burden of taxation for any section of the population. I desire to direct attention to the taxation of the gold mines on the premium they receive, and one other item. We have all heard the adage: “A straw shows which way the wind blows,” and we are now presented with another one: “A cigarette shows where the land lies.” Here we have an example of what I have been preaching in this House for many years. The hon. gentleman, quite consistently and quite rightly from his point of view, maintains the attitude this House has always held for the last 23 years, of supporting monopolies against the people. Here we have a concrete example of the truth of what I have been preaching all these years. Here we find that he imposes an item of taxation upon the poor unfortunate cigarette smoker who has the impertinence to make his own cigarettes. The Minister did not want money. If he drd, this tax is so small that it will have no effect on the general financial position of the country. He did not want to impose this tax in the interests of the youth of this country, because if he did, he would prohibit the manufacture of cigarettes. No, he wanted neither money as a result of this taxation, nor did he want to stop the smoking of cigarettes, but he discovered that the tobacco monopoly of South Africa, represented chiefly by the United Tobacco Company of South Africa, was losing £20,000 in revenue.

The State.

Oh, the State was losing £20,000. I have yet to learn that that £20,000, being such a flea-bite, has any effect whatsoever on the Minister imposing that taxation on manufactured tobacco so far as cigarettes are concerned. The Minister has the closest connection with the United Tobacco Company. He is in the position of a liaison officer with that company, and he is Kept in possession of all information. The fact remains that it will take a tremendous amount of explaining away that he was prepared to impose a tax which makes so little difference to the finances of the country, and at the same time will make a tremendous difference to the United Tobacco Company of South Africa. Here is a little leak in the wall of the monopoly, and the Minister puts his finger on the leak.

A new idea.

It is time this House had some new ideas.

The same old idea we have every year from you.

I would say this to the hon. gentleman. If you talk long enough to a parrot, using one set phrase, it will repeat it. My hon. friend has not reached the intellectual level of the parrot. I propose to read the amendment which I move—

1. (1) apply the entire gold premium to the service of the country by
   1. (a) raising wages of those engaged in producing the gold by a percentage increase equal to that of the gold premium,
   2. (b) instituting adequate pensions for all miners’ phthisis sufferers and/or their dependents,
   3. (c) establishing a two years’ clear cut interest moratorium for farmers,
   4. (d) public works construction, irrigation and erosion prevention schemes;
2. (2) make immediate restoration and restitution of the pay and other emoluments, privileges and conditions of public and railway servants and employees, to the date when cuts were imposed;
3. (3) eliminate unemployment by reducing hours or time of labour in all industries without reduction of standard of living;
4. (4) institute a national minimum rate of pay of 10s. a day in all industries;
5. (5) establish a State bank with the monopoly of the issue and control of credit and currency; and
6. (6) make suitable and adequate provision for all citizens of 60 years and over, and also widows.

That is the amendment. One of the drawbacks in our public life is the fact that some of our members of Parliament bring such a limited, narrow, restricted outlook to bear on public matters. To talk of this amendment as the millennium is stupid in the extreme. It is by no means a millennium, but it does mean, if given effect to, such an improvement in the conditions of the people of South Africa, that it would bring the millennium within reasonable distance. I am giving effect in this amendment to the concrete proposals of persons who have brain power, and who have got together and devised this programme for submission to this House and the country. The Minister of Finance, I would like to say, has acted quite rightly from his point of view. I know of no more honest man in this House. I am not complimenting the rest, mark you. I am merely stating my experience of the hon. gentleman as a colleague and as an opponent. You never hear the Minister of Finance even indirectly suggest anything that is not true, and the Minister, it should be noted, could not help informing this House that he was satisfied, and he expected it was not going to be contested, that the shareholders and the gold controllers were not entitled to one penny piece of this premium on gold. I reinforce the argument of the hon. gentleman. Shareholders or anybody else connected with that have no right to a single threepenny piece of that gold premium which resulted from a stroke of the pen made by the Minister of Finance a few short months ago. If that is the case, no case can be made out for any return of that premium to the shareholders of the gold mines. Here is my hon. friend, who always springs to attention when the gold-mining interests are in question in this House, or anywhere else. He once stated that the country has no right to this accrual to our revenue any more than the country has the right to the difference in prices when, for example, there is an increase in the price of wool. That is in Hansard; not exactly in that language, but I do not think that I am misrepresenting the hon. gentleman when I give it that particular bearing. I say it is entirely wrong. There are two most important and fundamental questions you have to consider. Firstly: there would be no gold premium at all if my hon. friend, the Minister of Finance, had not been compelled to go off gold—I hope he will forgive my putting it that way. That is item No. 1. Item No .2 is this: precious metals, especially in the Transvaal, are by law and by equity in the ownership and in the possession of the State itself. All gold found on the Witwatersrand or anywhere else in the Transvaal is within the ownership of the State. The people of South Africa own that gold, and those who control the gold mining industry work it only under the licence and the permission of the Treasury as the intermediary of the people, through this Parliament here assembled. These are the two true, fundamentally important matters that we must not forget in this respect. The Minister of Finance is perfectly correct in this—you cannot presume that the shareholders are entitled to anything. Then there is the hon. member for Turffontein (Mr. Sturrock) who also generally springs to attention on the question of the gold mines. The Minister of Finance, in his opening statement, suggested that we should give back some of this money to those who control the industry, in order that low grade ore can be worked. But immediately we went off the gold standard there was a premium, as there is to-day, of 50 per cent., advanced on gold parity prices, and you transformed low grade ore into high grade ore, and when there was a hovering between a loss and a profit it immediately became a profit.

The MINISTER OF MINES [inaudible].

I am referring to the normal gold production of the Witwatersrand. I have always dealt with it in that form and from that position—in a normal year, normal production. At once you offer the necessary inducement to all those who are controlling the industry to work the low grade ore which it now pays them to extract. So that argument holds no water, and I contest the opinion expresssed by my hon. friend that we should allow some of this money to go back to the controllers of the mines. I want the House to get this at the back of its mind, that the mines are composed, not entirely of mine owners, not composed entirely of shareholders, but also of the men who work the mines; and of these, the people who work the mines are the more important—more important than any of the others engaged in the industry. My hon. friend talks of the ramifications through the whole of the economic life of this country. I want it to ramify through the whole of our economic life. If you hand this money to the shareholders do you expect them to do this? We have to do it overselves, and make it impossible for this money to melt in the pockets of these people. We have to use it ourselves. That is why I ask that we should insist on using the whole of this gold premium, which is a premium on gold normally produced at 84 shillings per ounce, and that it shall be taken by the Minister of Finance and so allocated as to bring about the best results for all concerned. The first is, that we should increase the wages of those who produce the gold by a percentage equal to the percentage gained by the gold itself. It is admitted on all hands that they are the most important section. The more their wages are, and the more you distribute them through the country, the higher the spending capacity and earning power represented by my hon. friend, who represents the business community, and by my hon. friend, who represents the farming community. The Minister and the hon. member talk about the necessity of increasing commodity prices. You are going to a Conference. I find that the Minister of Justice is going to this International Conference in a humble spirit, and he says that South Africa will play a humble part there. I say it will play a very big part. You talk glibly of the necessity of increasing commodity prices. It cannot be done by a stroke of the pen. The only way you can do so—and that is, only incidentally—is by making it possible for more and more human beings to be brought into touch; to bring those who are producing the commodities into touch with those who are consuming them. To-day, by means of unemployment, and under-employment —I mean by this under-payment of wages—you make it impossible for the goods that are produced to be consumed, and I therefore urge the desirability that you consider—and consider most seriously—the advisability of raising the wages of those people who produce the very commodity which, by a stroke of the political pen, makes it possible to have this accrual of 20 million pounds. But then how often have we not heard in this House when we have been discussing the claims, nay the sorrows and the miseries of those unfortunate people the miner’s phthisis sufferers, how often have we not heard it by people like the hon. member for Springs (Sir Robert Kotze) the hon. member for Turffontein (Mr. Sturrock) and others of a similar kidney, urging that it was going to impose such a burden on the gold mining industry. I do not admit the justice of their contentions one moment, but now their objection falls away, because you now have an additional twenty million pounds’ to play with, not in the rightful legal equitable ownership of the shareholders but in the ownership of the State as outlined by my hon. friend over there. You will remember, Mr. Speaker, that immediately this part was announced I outlined the policy of the Labour party as opposed to the pact and challenged that pact to contest that policy. First of all I asked them to adopt that policy and secondly, when they would not adopt it, I asked them to show me where we were wrong. In that policy was included this very fact which I am now reiterating.

An HON. MEMBER [inaudible].

The representation is no criterion of the justice of the programme; rather it is a reproach to you of the methods you employed to dragoon the country into returning you. However, that is by the way. We have proposed a clear two years’ interest moratorium for the farmers. The hon. member for Turffontein rather stumbled on the truth when he said in effect “What is the use of your reducing the interest rates on the farmers’ mortgage bonds if they cannot pay the reduced interest?” That is the point. We recognise that this is only a palliative, but we do say that the time has arrived to call a short halt at all events to the sorrows and oppression suffered by the farming population. You have to take the farming industry as an industry when you are dealing with it by the State. This fortuitous money that has accrued to our exchequer we should use as far as may be to secure for the farmers, for two years at least, peace from the oppression of those who hold mortgage bonds over their heads. The rest of our policy is the elimination of unemployment by reduction of hours or by other means that were found desirable to impose as circumstances warrant, until all the people are employed usefully and are consuming the goods produced in the country.

While that policy was being given effect to we should have a little interregnum of two years for the farmer to rest on his oars. If the House were sensible and accepted that policy of reduction of hours until all were employed, by that time opportunity could have been made for the consumption of the products of the farming population and their commodity prices would have risen. That is the only way in which you can bring about any rise in commodity prices, and I appeal to this House to apply its intelligence—not your prejudice—to an examination of the problem. Do not allow your prejudice to sway you. Do not allow your ordinary stereotyped methods of dealing with economic problems to guide you, but be prepared at all events to consider the matter. I make bold to say that once you realise that you have overlooked the real function of money and currency, which is a medium of exchange, once you have realised that, you will realise that money is not so important except as that medium of exchange, but what really is important is the distribution of the goods that are produced and the consumption in consequence of those goods. Now I come to what is perhaps the keynote of the whole situation, and that is the institution of a State bank. The man or the group of men controlling the finances of the country control the whole destiny of the nation, and I am reinforced in my argument very strongly indeed by the revelations that you and I, Mr. Speaker, and the rest of the House and the country have had placed before us by the Morgan enquiry in America. [Time limit.]

I will second the amendment. After studying the statement placed before this House by the Minister of Finance, I must confess to a feeling of dismay and disappointment. There are many other members representing urban constituencies who came here with the true coalition spirit, and I am sure they also have had their feelings damped very considerably. The Minister’s formidable statement reveals to me nothing new with one exception, and that exception is this £18,000,000 that is to be doled out, and that, I suppose, represents the true coalition spirit. It seems to me that big finance still has the Government by the throat, and for that reason the Government has parted with two-thirds of the premium, a premium which has not been created by the mines, but by the State. They have parted with this money because of some grip which the financiers have on them. The remaining one-third goes to the farmer. I want to make our position quite clear—we have not the slightest objection to the poor farmers being helped, but we do oppose, and very strongly, the indiscriminate help which is being given to farmers who are well able to carry their own obligations. We do object to that while poverty and distress are rampant in the towns. What is being done for the wage-earner or for the poverty-stricken people in the urban areas? Their staple foods are taxed to such an extent that they are no longer able to provide reasonable sustenance for their people; their wives and children are starving, and yet the farmer who does not require assistance, is now getting it.

What do you know about it?

I know what the position is, and I am speaking about the farmer who definitely is not in need of help. The unemployment position throughout the country is terrible, but apparently little or nothing is being done to relieve it. Yet there is an absolutely easy method to deal with it, and that is represented in the amendment put forward. On the unemployment position I hope that reasonable members of this House will insist on something definitely being done to relieve the great distress caused by this unemployment. We say that while this tremendous amount of money is being given away in directions where it is not required, the Government should turn to help in other directions where help is greatly wanted. We have the old age pensions, for instance, and we want to see something done in that direction. Surely there is nothing unreasonable in asking that old people who have served this country, who have contributed to the taxation of this country for numbers of years, should not be left at the mercy of charity when they are no longer fit, or as often is the case when they are no longer allowed to be employed on account of their age. Today those people have to be thrown on the streets and are forced to rely on charitable societies and other sources. There is no need for charily in those cases, and the duty of the State is perfectly clear; I trust that something will be done there. Coming to the provincial council question, which is a burning one in Natal, I would like to draw attention to the position which exists in that province. Apparently the Minister contemplates doing nothing in the matter at the moment, he does not intend doing anything to alleviate the situation. Tn Natal we are faced with the position that our local taxation is double that of the Free State, and yet the central Government subsidy is twice the amount to the Free State which it is to Natal.

They have more children.

It does not matter whether they have children, or what they have.

That is the basis of the subsidy.

Exactly, but why retain that basis? It is an inequitable basis, and the Minister has the opportunity of dealing with that particular point, and of adjusting a matter which is crying out for adjustment. As the hon. member for Durban (Point) (Mr. Wadley) has mentioned the position, I would draw attention to the situation as it exists in Natal, a situation which the provincial council has ignored.

They have not. They knew all about it before you were born, and dealt with it.

We have the position that this benevolent fund has gone bankrupt, simply because they cannot get the necessary assistance. The provincial council provided £4,000 to the fund, and the Durban Corporation £12,000, and now the provincial council will not force the central Government to contribute on a more reasonable basis. Then we also have the scourge of tuberculosis in Natal, and there is no provision for the provincial council to deal with the matter. In the last six years over 2,000 cases were dealt with at a place totally unsuited for the purpose. In that time there have been over 1,000 deaths. It is a disgraceful position which the provincial council should long ago have brought to the attention of the central Government. Then again we have the question of the restoration of cuts in wages of railway and public servants. These cuts have been restored, but the money taken from the servants has not been restored to them, and surely in a time of plenty it is the duty of the Government to do something in order to help these people. I have no intention of bringing in personalities, at least not for the moment. While the Minister of Finance may be pleased with the large contributions which the post office has made to the general fund, Government departments such as the post office should not be used as a taxing machine. If the post office revenue exceeds the expenditure to such an extent as to permit that transfer to be made, surely the time is ripe for a reduction in postal, telegraph and telephone rates. In view of the vast amount of unemployment there is throughout the Union, I suggest that the post office should now restore many of the public facilities that were withdrawn during the war period; that would add to the amount of employment and would also be helpful to the public. Instead, however, of creating more employment and adding to public facilities, the post office entered on a scheme of retrenchment which was heartless and cruel, and without any justification. The position is regarded as an administrative triumpn, but it was a stupid and clumsy attempt to force cheap labour on to the department. It is very easy to say that a certain position can be reduced in status and pay, but before that is done, a great deal more consideration should be given to the matter, and I trust that the Minister of Posts and Telegraphs will make an effort to restore the very efficient officials who were retired.

I venture to think that the present budget has been waited for with an intensity of expectation and interest which is unique, and it is necessary to sum up the position as to what the budget really means. One can pick on three features of the budget as being outstanding. The first is the outstanding success which has followed the abandoning of the gold standard and re adjusting the currency of South Africa in accordance with world conditions. The outstanding success of that has been shown not only in the increased prices received for mining products but for farming products, and the vast sum which has been placed at the disposal of the Government as the direct result of the re-adjustment of our currency problem. The second feature of this budget is that despite the very great distress prevailing throughout the country and the depression which has overspread us, there are no economies to speak of. In ordinary circumstances, it would have been the duty of the Government to have reconsidered its expenditure and to have given very serious consideration to the question why the burden of taxation should not have been cut very severely indeed. I regret very much that the Government have shown no indication that they have given any serious consideration to the possibility of reducing the burden of taxation. I consider that that is a very regrettable feature indeed, but it does not stop there, for the burden of taxation has been vastly increased, and the amount which it is proposed to take from the pockets of the taxpayer is now outstandingly and overwhelmingly larger than any sum of money ever taken from the pockets of the taxpayers before. It is very regrettable indeed that no effort at economy has been made. The third feature of the budget is the huge transfer which it proposes to make from the earnings of one section of the population to the pockets of another. This, I think, is rather a new feature, but it is one that cannot be passed over in silence or treated lightly. As far as South Africa is concerned, in the past we have always considered that all should contribute to taxation according to their means, and it is a novel feature of this budget that there should be a transfer of such a huge character from one section to another of the population. This is by way of criticism. I wish to say what I conceive to be the duty of members of Parliament under present circumstances. Hitherto we have been ranged in different parties, and we have had to give expressions of opinion taking into consideration that arrangement of different parties. This has had its drawbacks, for it has been to a certain extent an expression of a corporate opinion. I conceive, however, that one of the great advantages arising from coalition is that the machinery of the caucus is no longer necessary; thereby the personal responsibility of individual members of Parliament is increased. It is our duty to assist the Government on each and all occasions by way of constructive criticism, but that criticism must be frank, full and free. It is not for the purpose of blessing, but of assisting the Government that I offer the criticism I am bound to make on this occasion. The principle of transferring the earnings of one section of the population to another section is likely to become popular and to grow, and it is likely to extend from the commodity of gold to other commodities, but I fear that we are on a slippery path in helping one section at the expense of another.

The biggest transfer of all was made to the gold-mining industry when we quitted the gold standard, and my hon. friend did not assist me then.

The transfer of our currency from a gold basis to a sterling basis affected the whole population, and it benefited not only the producers of gold but the producers of agricultural and all other products. The so-called premium on gold is a premium which has been gained by agricultural products as well. The Minister has put forward in a white paper that this alteration of currency benefited agricultural products to the extent of 40 per cent. There is no more justification for referring to the increased price of gold resulting therefrom, than there is in referring to the increased price of agricultural products resulting therefrom. There is no justification for referring to one more than the other. If you are going to use the word “premium” in regard to gold, you must also use it in regard to agricultural products, when your agricultural products are exported.

The drop in wool was 400 per cent.

What has the drop in wool got to do with it? I am talking about the increased price you get when you export. If you are going to use the word “premium” for one, you must use it with regard to the other. The increased price that we have got for gold is a parity, and is describable in precisely the same terms as the increased price we have for agricultural products. It is contended that we have a right to tax gold, or the increased price of gold, because the right to mine belongs to the State. Of course it does, but as the Crown very often does not dispose in freehold, but disposes in leasehold, you have no more right to tax a gold estate in this way than to tax a leased farm estate. I say, with deep regret, that the Minister of Finance is launching South Africa on a very dangerous course, in allowing people to suppose that the profits of one section of the population can be placed in the pockets of another section of the population, and that this can be justified on grounds of expediency. I am very much afraid that the Minister of Finance has been dipping into the books on economy of the hon. member for Benoni (Mr. Madeley). I say, in all seriousness, that I am very frightened for the result, because the Minister is launching South Africa at the present stage on a very slippery path, and we cannot say where it is going to end. What are the outstanding features of the circumstances of the country which justify this? Coalition was brought about on no personal grounds, but by the overwhelming desire of the people of South Africa, without any difference of race or party. It was brought about to deal with two things. One was to abolish political division on racial lines, and that, we hope, has been done well and lastingly. But the second was this, that the brains of the country should be pooled for the purpose of dealing with the overwhelming problem of poverty, which is affecting the population most seriously. It is no mere question of unemployment. A man may be unemployed and may yet be above the poverty line. We have this fact to realize, that a most competent commission, after years of study, have come to the conclusion that more than half the population is below the poverty line. It was that fact, and all the misery that is represented by it, which brought about the pooling of the brains of the country, which brought about the Coalition Government, and I say that the country expected that the Government would face up to the enormous problems of South Africa, and give a solution thereto which a party Government might find itself too embarrassed to bring about. How have they dealt with the problem of poverty? I say that the Government has fallen short in this, that they have fastened on one section, and one section only, of the population; that is, farm owners who have bonded their farms. This is a complete misapprehension of the true problems of the country. I quite agree that if we could restore prosperity to South African farming, as a whole, it would be worth paying for, and if the proposition of the Minister of Finance was that by this transaction we should be able to restore South African farming to a paying basis, then he could justify his proposal. I say that the outstanding opportunity of South Africa is the development of its extraordinary mining assets. I do not believe that it is necessary for this 50 per cent., or for any large percentage of our population, to go without sufficient food and clothing, and decent housing for any period of time, and yet we have the conclusion arrived at by a commission that half the population is habitually unable to feed and clothe and house its families. It is an appalling state of affairs, and the Government, as far as their budget proposals indicate, are apparently blind to that fact, and are using this enormous sum of money mainly for the purpose of contributing to the necessities of that comparatively small section of the population that owns farms, that has bonded those farms, and finds itself in difficulties in paying interest thereon. That is the main transaction and the basis of this budget. How can that be justified? Unless that is justified, this budget itself is not justified, and fresh proposals will have to be made. If South African farming is really to be restored to a condition of prosperity that would go very far to deal with the question of unemployment. Many more people can be absorbed once it pays and it is put on a sound footing. Unless you show that by this expenditure of money you are restoring, or going far to restore, South African agriculture to a state of prosperity, there is no justification for a proposal of this sort. It becomes a mere dole which will not help the farmer ultimately at all, and in the end, will leave him in much the same condition in which he is. What is at the back of the depression in the farming industry? We want to face up to that and try to analyse it, and to isolate it if you can. We believe it is a drop in the prices of agricultural produce; but was all well, was there no poverty, before this drop took place? We know that commission after commission has sat to deal with the poverty of the people of South Africa, and their recommendations have been filed in blue books; and no action has been taken. Have we not had unemployment and dire distress in the towns, and has there been no movement of people from the country to the towns—blacks as well as whites—before this world drop in prices took place? This drop only accentuated and intensified the process which had been afflicting us for years and years. It is true that this drop in prices intensified the position. It might have been avoided for 18 months if the Minister had altered the currency position before he did. But what are we going to do? Are we going to sit still and wait until commodity prices rise all over the world and say that the prosperity of South African farming is linked with overseas prices? Is this a grant made in expectation of a very substantial and permanent rise in prices overseas? Do you think your agricultural produce is going to rise in value to such an extent that you can carry on farming at a profit in future? If there is any such fancy and any such idea at the back of the Government, it is doomed to disappointment. Since the great war a tremendous change has taken place. You have all the resources of modern machinery, which is capable of turning out a tremendous amount of products. For South Africa to wait for the restoration of South African farming in the hope of an increase in the prices overseas is a futile and a vain one. I say the time has come and we must face the facts to see what is paying and what is not paying in our agricultural pursuits. In the past South Africa has not been sufficiently led as to the way in which our agriculture should proceed. The farmer has been left too much to do as he likes with regard to his products. Why should we not consider what it pays to export and what does not pay to export? It is vain to consider exporting mealies. Mealie export is a dead loss to South Africa. We should consider that and weigh it up, and no longer continue to pay subsidies towards it. The energies and the abilities of the country should be diverted to see how mealies can be used to advantage in our own country. With regard to sugar we should face the fact that its production is uneconomic. With regard to wheat we should realise that its production is also uneconomic. I give that as my opinion, and I do not think it should be accepted straight off-hand as final, but it should be enquired into. It is necessary that the Government should go in for a real enquiry and a real review of the whole position to see what could be gone in for by South African farmers with a hope of success. At the present time the amount of money which is voted to farmers in the way of subsidy is huge. You have a figure of £2,500,000 on the export subsidies. You have probably £2,000,000 extra cost of sugar. I have not been able to work out the extra cost of wheat—something between 22s. 6d. and 12s. 6d. for the total quantity of wheat of South African production. There is £3,500,000 proposed by the Minister to be specially appropriated. We have £10,000,000, I calculate, which will come from the pockets of the tax-payer and go to a large part of our farming community. That is an appalling figure. We are all interested in farming, just as we are all interested in mining. But really, with the diversion of this amount and with figures of that kind, one realises that the case for a serious enquiry has been made out. I regret to see that the Government so far has made no indication that it proposes holding such an enquiry. Surely, an enquiry of that kind is called for. I do not care whether it is a departmental one or whether it is by a commission, but it is one which has to be made before this expenditure is passed. Who are the people who are really benefiting by the grant which is to be made; I refer to this grant of one and a half per cent. towards the amount which is due in interest on bonds. I think our figures here in the white book and the information given are very sketchy. How many farmers there are who are unable to pay their interest I do not know. There is no information on this point. We have this figure that about £1,500,000 is outstanding in the way of arrears. That is the estimate in the white paper. The total amount of farming mortgages is given as £100,000,000. That is more than two years’ interest on all the bonds. At any rate it is an extremely large sum. Now that appears to me to be indicative that this section of the farming population—or rather I should say the farm owners—are unable, a great many of them, to pay any interest at all. Those who cannot pay are the farmers who are hardest up and who have been hardest hit. These farmers are just the ones who are to receive nothing at all under this scheme. The 1½ per cent. is only to be given to those able and willing to pay 3½ per cent. on their own. So that the section of the farming population which is going to benefit under this is the more substantial and the more wealthy and the better-off portion of the select group of farmers who own their own land. So far from this being a grant to the whole farming population of South Africa, it is nothing of the kind. Some members have spoken as if this were a grant to the farming population as a whole, and the comments in the press apparently regard it on the same footing. It is nothing of the sort. This is a grant to a small body who can satisfy certain peculiar requirements. First of all, the tenant farmers go by the board. They do not receive any benefit at all. The corporations who own land, they go out, and all the farmers who farm as a subsidiary matter, also go out. I say that when you whittle this down, when you come to analyse who these farmers are and where they are located, instead of its being the farming population as a whole, it will be found to be only a comparatively small section. To transfer this immense sum of money in that way for the benefit of these people seems to me to be absolutely without justification. Who are the people who require this assistance, or any assistance, in order to keep them on the land? Well, I have here a memorandum issued by the Association of Trust Companies in the Union, on Dr. van der Horst’s scheme, and the executive committee seems to accept that the figure is 20 per cent. or 30 per cent. Whatever the figure is, it will be open to criticism. I do not suppose it can be proved, but the Minister of Finance is admitting that it is impossible for him to conduct an enquiry as to who are those who need assistance, and those who do not. Therefore he is making a grant to all. I suggest to him that a scheme and a system, which admittedly is open to that criticism, stands selfcondemned. The assistance which the farming industry requires—I admit it does require assistance, and I have been saying so year in and year out—is not of the character indicated in this budget, but is of a radically different character altogether. There is one sentence in the white paper, to which I would like to draw the attention of the House. It is the concluding statement in the Treasury minute dealing with this matter, and it is in the following words—

Let it be realized that economic independence alone will make them an asset to the State, and how are you going to transfer this year £10,000,000 from the pockets of the tax-payers to the farming population, in one form or another? What possible justification can you have for transferring it, not to the whole of the farmers, but to a comparatively small body who will be the main beneficiaries under this svstem? How can you possibly wonder that the hon. member for Benoni (Mr. Madeley) is able to come here and say: “You are giving to those who do not need so much, and out of this enormous sum of money you are providing practically nothing to relieve the poverty stricken population of the country.” I say that criticism is justified. It is one of the outstanding blots on the scheme that the Minister, on the one hand ignores the poverty-stricken, and gives an enormous sum of money to people who, however hard-up they may be, are not that section which habitually cannot find food and clothing and decent housing for themselves and their families. This is not going to restore South African agriculture. This is going to be another nail in its coffin. It is going to show, once again, that the farmer has only to come forward with sufficient political backing in order to get enormous sums granted to him, out of the pockets of the taxpayer. I regret very deeply that the great opportunity which the coalition Government had of facing up to the enormous problems outstanding in South Africa, has been neglected. I trust it will be done on some future occasion, but on the present occasion it is not being done. If I am right, then this is sufficient to condemn the budget proposals in toto. I want to say a word on the gold side of the question. I understand that these taxation proposals are intended to help in the development of the extraction of low-grade ore as against the high-grade proposition. I have looked at examples one and two in the schedule. One is taken I gather, from the Modder Deep and the other from the E.R.P.M. The latter is a low-grade proposition and the percentage of extra duty which is to be taken from the excess profits amounts to 29 per cent. In the case of the Modder Deep which is a high-grade ore proposition, the percentage which is being taken comes to 17 per cent. You are going to take only 17 per cent. from a high-grade proposition and 29 per cent. from a low-grade proposition, according to these two examples. I do not know how that is explained, but it seems to me to be an extraordinary way of carrying out a scheme intended to benefit the production of low-grade ore. The details of the scheme I would not attempt to criticize even if I had time because there are critics more competent than myself able to do so. On the general result, however, I want to say a word. Do the Government really suppose that they can take this enormous sum of money which they are proposing to take without hitting the expansion of the gold-mining industry very heavily and without crippling expansion? They cannot. The only way in which you can get expansion of the gold-mining industry is by encouraging the introduction of fresh capital, and by allowing, therefore, the maximum amount of profit to be earned by the person who puts his money into the industry. You are not doing this. You are hitting him, and it is particularly unfortuante, at the present time, because so closely have the secrets of the Treasury been guarded, that those here and overseas interested in mining had no idea that such an enormous amount would be taken. They were justified in thinking so according to past precedent and practice of this House. Well, I say that a tremendous blow has been given to the expansion of the gold-mining industry, and I regret it very deeply indeed. Deep disappointment will be caused, and with that will follow a reluctance to invest, to explore these new opportunities for opening up fresh areas which are so necessary for restoring prosperity to South Africa. Where does this policy come from? What is the philosophy underlying the budget, what is this policy which squanders the money, which does not sink it into reproductive enterprise, but which leaves it as a dole which will in turn leave the farming population no better off than it was? The philosophy underlying this budget is the same as that which underlay the Farmers’ Relief Act of a year ago and exactly the same type of criticism justified in that case is justified in this, and I deeply regret that the coalition Government has put forward a budget which is based on this philosophy of no advance at all. This budget I regard as being tragic. I think it fails in all the positive things it might do. It contains dangerous principles of squandering our assets —it is disappointment of our hopes, and I can only do what a humble member can do, and that is record my opinion in the usual way.

I welcome the budget in the form it is coming before us. I feel that the public were expecting a great deal from the budget and from the Government, and that expectation has been realized to a certain extent. There are however, one or two small points I want to bring to the Minister’s notice. The first is that there is a certain section of the population which feels that they are strangers in their own country. I refer to the occupiers of lots along the Witwaters rand. They do not come under town councils, they are not in the municipalities, nor are they considered as farmers. In the past they have never yet been mentioned in the budget, and they have no place to which they can go for assistance. They cannot go to the Land Bank or other public bodies. I want to draw attention to them so that there may also be a place where they can go for assistance. It is necessary for them to be helped and as a representative of a constituency containing such people it is my duty to speak on their behalf so that they can be asisted, and be kept off the streets. The pieces of land they live on are small, ten, fifteen, or twenty morgen or acres, they have bought the land with the money they received as miners’ phthisis compensation, or with money saved. In consequence of the bad times they are now in a bad position. They cannot dispose of the produce, and the bad times have resulted in their having to leave the ground, and being in danger of getting on to the streets as unemployed. At present in cases where assistance is asked from the Land Bank they are told that they cannot be considered farmers and that the Land Bank can, therefore, do nothing for them. No other body is responsible for them, and no one is assisting to look after the future of those people. I want the Minister, therefore, to see if they cannot be assisted. Then there is a point which the Minister mentions that a certain number of unemployed are getting work on the mines, about 700 persons, or a little more. I want to make it clear that those persons who are re-employed in the mines were not actually unemployed, they are somewhat irresponsible youths. They are young men who came from the country to the Rand to look for work, as well as those who are in the Government mining schools. Those boys are employed in the mines, but the unemployed of the Rand are not engaged. Those people are still walking about today without work. It is one of our greatest grievances. I mention it to show that it is not the unemployed on the Rand that are being engaged, but that they are 700 youths who are being employed on the mines. I feel that the House from the statement of the Minister understands that because 700 more people have been employed by the mines than before, that the condition of unemployment has been relieved to some extent. That is not the case. They are boys who had no responsibility, because they had no families to provide for. I consider people with families as responsible people, and they are the ones that we should assist. Another thing I want to refer to is that in the past a fairly large section of the farming population resorted to the Rand in the hope of getting employment there to maintain their families. Now we may expect that very shortly about 20 per cent. of the farmers that we cannot rescue will go to the Rand again. Then I want to add that I do not consider the sum of £750,000 for the combating of unemployment sufficient. We can take it from experience that unemployment is daily increasing, not only in small numbers, but in large numbers, and we ought to make provision to see that those persons do not suffer from hunger. A year ago it was laid down that the number of people below the bread line was 48½ per cent. I think about 20 per cent. of them are already under the roof line. We do not under any circumstances ask for free gifts, but a large section of our people are people with principles. They would like to work, and we, as a responsible body, should see to it that there is work for people who want to work so that they can fulfil their responsibility as heads of families.

I think the whole country will be thankful for the assistance the Government is giving the farmers in this budget. The farmers are really going to get a reduction of 50 per cent. in their interest if we assume that the interest is going to be reduced to 3½ per cent. We all feel and the country feels particularly thankful for this concession. We found out in the past that in helping the farmers you help everyone because everybody benefits when the farmers are assisted. When the farmers suffer, all suffer. In the large towns it may possibly not be felt immediately, but on the countryside in the small villages it has been found that when the farmer suffers all suffer, the doctor, merchant and the attorney, and even the minister cannot get his stipend. Everybody will therefore quickly find out that by assisting the farmers they are also benefited. Not only are the farmers grateful for the assistance in the reduction of interest, but also for the fact that the arrear interest can be added to the capital and that the Government will in addition give a subsidy on it. I think that that is a great encouragement to mortgagors not to press the farmers for arrear interest. For the £4,000,000 which the Government is giving the Land Bank to assist the farmers we are also very thankful. I do not want to go too far, but I doubt a little whether the £4,000,000 is enough to meet all the needs. And because it will possibly not be enough I would like to take this opportunity to tell the management of the Land Bank that in fixing the financial standing of the farmer they should bear in mind all the circumstances that exist to-day. The Minister in his budget speech said that account must be taken of the fact whether the farmer can last until the Land Bank can take over his mortgage. If the Land Bank, therefore, is going to bear in mind in these circumstances the present position it would seem as if there would be a large section of the farmers who will not weather the storm, because the value of property has dropped very much just now. Just as soon, however, as there is a little improvement in the market the position of the farmer will improve so that he will be able to fulfil his obligations. I would like to suggest that local bodies should be appointed as soon as possible to supply the Land Bank with the necessary information. It is impossible for the management of the Land Bank to know the position of all the farmers, and it will, therefore, be a very good thing if local bodies are created to send information to the Land Bank. I do not mean that the Land Bank management is not acquainted with the particular needs of the farmers, but it will help them a great deal, and I therefore hope the Minister will see that there is a responsible committee in every district which can give the Land Bank necessary information. It may appear as if I wanted to go a little too far, but I fear that with all the assistance which the Government is giving to the mortgagor that we shall have mortgagees who will anyhow not want to reduce their interest but to make it up in some other way. We must assume that there are many floating acknowledgments of debt, overdrawn bank accounts, etc., which are not touched here, and on which the interest can be increased, I hope the Minister will very seriously consider this matter. The position may now be that in the case of floating promissory notes or overdrawn accounts, because the mortgagee is compelled to reduce his interest, that he will increase the interest on them to make up for the reduction of the interest on the bond. He will, therefore, take a different course so that the interest to be paid by the mortgagor will still not come down. I hope that the Minister will consider this very seriously because I am afraid that we shall have mortgagees who will try to get money by other methods. I do not say that these people are not to be protected as well, but we have found in the past that there are absolutely conscienceless men and who have increased the interest as the position became worse. I am afraid that now that we are trying to tighten the screw in one place they will try to counteract it in another. I say that no man ought to get more than 6 per cent. interest on promissory notes or anything else. If the Government will go so far as to say that the mortgagees must reduce their interest on bonds to 5 per cent., why should it also not be done in this case? I do not think that in a single case will the law have to be invoked if a clause were put into the Act giving the Government the power to collect all interest exceeding 6 per cent. with the tax, then there will be no trouble with lower rates of interest. I hope that the Minister will bear this in mind because we have to do with many cases not only of bonds but of promissory notes and overdrawn accounts, the interest on which presses so heavily on the farmer that he will not be able to pay the 3½ per cent. interest on his bonds. Then there is another thing. It will be said that I am asking for a moratorium, I am not in favour of it, but let us call it a partial moratorium. We have found many cases where the creditors press people in a reckless way. If the people had been given a little time they might perhaps have come through, but the creditors would not give them that time. The committees to advise the Land Bank, which I have referred to, can also enquire into these cases where people have been recklessly pressed. Those people can refer to this commission and if such an individual can hold out if he gets time, then the creditor will have to be satisfied with a pro rata share of his income. That will assist both the debtor and creditor. The creditor will know that the person will pay as much as he can, and the debtor will get time to look round and see if he can weather the storm. If we look at the matter from the proper standpoint, we shall see that it does not go so far as a moratorium, and if the Government can consider something which can be included in the proposed legislation in this connection it will be a good thing. As I have said, there are cases of undue pressure. It is possibly the minority of the creditors which force the majority to do so, and who in that way compel the debtor to go insolvent. He is ruined, and yet the creditors do not get their money. At present an abnormal state of affairs prevails and we must not allow creditors to ruin and sell out people in a reckless way. A local committee will be able to do a great deal to prevent this. I maintain that this is not a moratorium, although to some extent possibly it is.

Call it protection.

Yes, we can call it protection, because doubtless there are more than one who have been sold up by reckless mortgagees who would have been able to pay some day. I am glad the Minister is enquiring into the credit associations. I hope that it will be done very soon, and that the commission concerned will also be instructed to enquire into the emergency relief loans granted to farmers. It looks strange to be advising an enquiry now, although the Act has been in operation such a short time, but it is a serious matter, and I have always thought it should be enquired into. With regard to the credit associations, the interest on the loans must be gone into, and I think that it should also be enquired into whether the obligations cannot be written down one-third. The credit associations consist of the weaker and younger farmers: they bought stock when the prices were high just before the large slump. In consequence of the drop it became impossible for them to fulfil their obligations and a little assistance now will help many of those people to get through who would otherwise have been ruined. If the Minister gives the credit associations the opportunity of paying less it will help considerably. I hope that there will also be an opportunity of writing off a part of the burdens, even if it is only a quarter. We have written off £550,000 for the maize farmers. To write off a quarter for the credit associations will be a trifling sum, but it will help a great deal. As for the relief loans, I am sorry that the interest on them cannot be reduced to the basis of mortgage interest. Nevertheless I want to recommend that the same commission should have the opportunity to enquire into this matter to give the people necessary relief in regard to interest. This is a matter which deserves the serious consideration of the Minister, because if they do not get relief, then the Emergency Relief Act will possibly be the cause of those people being ruined. In many cases the Relief Board treats those people very fairly, but there are also cases where the people are pressed, and I can quote instances where people have been ruined owing to being pressed by the Relief Board. If the commission enquires into their position, then the people will know exactly where they are, and if the commission can consider giving relief in respect of interest, it will be a very great help in keeping the farmers on the land. Before sitting down I want again very heartily to thank the Government on behalf of the farmers for the assistance the farmers are receiving. I can assure the Government that I am convinced in my heart that the reduction will assist thousands to hold out, and I hope the mortgagees will be prepared to support the Government’s proposal. The interest burden has strangled the farmers and in addition prices have dropped to such an extent that with the best will in the world it was impossible for the farmers to bear the burden put on them. The relief offered will see the greatest part of the farmers through. In some respects the assistance offered has exceeded our expectations and I want again to thank the Government.

I would say, in the first place, that if you take away from this budget the gold premium, and the division of it, its possible application and all its surroundings, there is very little of the budget left. It has been suggested that shareholders should have no part in this premium. The position is that it is not entirely the gold premium but the division of it that will cause concern. I notice various expressions of opinion, not only here but in Johannesburg and in London, with regard to the amount of taxation, the amount that the Government is taking out of this gold premium. It is well that these expressions of opinion should be examined before being accepted as correct. I notice a statement that the claims of this taxation come to some 16s. or 17s. in the pound, and that in other cases it is said to be from 75 per cent. to 80 per cent., but when we look at the real facts of the case we find that in all these calculations a great many things seem to have been omitted. They have omitted, for instance, the special allowance of 10 per cent., and the income tax allowance, and the 1s. per ton milled. So far as one can judge, almost throughout the country there was a feeling that fifty-fifty was somewhere near the mark. A more important thing, however, was to decide to whom the gold premium belongs. Does it belong to the mining companies? Does it belong to the country because the Government have gone off the gold standard, or to whom does it belong? I take it that it is a heaven-sent gift belonging to no one, and that there is consequently a justification for a division such as is proposed. I agree generally with the division. I agree generally with the budget. I believe that somewhere about fifty-fifty is reasonable, and about what the country expects. But that is conditional. If there is not more and more low-grade ore being worked every week and every month then it is perfectly clear that the whole matter should come up for adjustment, because the development of the gold industry and the working of that low-grade ore means everything to the country. It is a commonly accepted position that the more money there is available the more low-grade ore will be worked, and the hon. member for Turffontein (Mr. Sturrock) suggested that the whole of the money might be put back into the ground, and that this country might be better off in 20 or 30 years’ time if that policy were adopted. My objection to that policy is that the country cannot afford to store away the whole of this gold premium, and to put it back into the ground in order that posterity may benefit, when we find our producers in such distress. Consequently I am a supporter of the position taken up by the Government in the budget. Mining has once more come to the rescue of this country. The gold fields with the premium is going to be the saviour of this country once again. Just as in 1872-’3-’4 Kimberley with its diamonds saved the Cape Colony, so this year the gold industry is going to save the Únion, and it will in a measure at any rate rehabilitate the farmers of the Union. The whole of the country is to-day concentrated on the difficulties of our producers, on the terrible position in which farmers are placed, and on the distress which exists on the land. I would like to say that other sections of the community have suffered in accordance, and I would say further that to-day the gold-mining industry is at the very peak of prosperity, it employs more and more men, and yet you find that trade in your country is languishing, which means a very great deal, because upon that everything else is built. In order to prove that position, I would draw the attention of this House to the position of our trade during the past two or three years, and the only barometer the House has had, or ever had, is the imports into this country. I find that from 80 million pounds we have come down to 52 millions, and I say that visibly shows how the trade of the country has depreciated. That is, in 1931. When we come to the following year, 1932, we find that 52 million pounds has been reduced to 32 million pounds. Now the difference between the amounts of the imports for these years is a difference between the prosperity of our trade and its adversity; and you can see to-day as in a mirror the reflection of the farming industry to the whole of the trade of the country. I am not pleading for any benefit to the merchant and traders. Restrictions are placed on trade, which make it well nigh impossible. But I want to impress on the House that it is not only the farming industry of the country which is in a very bad way, but the trade of the country is disastrously near collapse. You may assist the farmer in a measure, but it is done at a tremendous cost. I am not grumbling at this, but when all this is past, when we are away from all our quotas and gifts and doles and our export bonuses have disappeared, we must come back to this position, that the producers of this country must produce and sell their products at world prices. That will be the end of this, and that undoubtedly will have to take place. The budget in respect of taxation is not only disappointing, but is discreditable. I want to point out to the Acting Minister (Mr. Duncan) just how it is discreditable. After all, the word of the Minister of Finance or the Government’s word ought to be its bond just as an individual’s word is his bond. I am speaking in respect of the taxation placed on this country owing to our remaining on gold when this country was in dire distress, and it was going more headlong to pieces than ever before. That taxation was passed for one year, and all the increased taxation—stamp duties, double cheque rates, extra inland revenue, and so forth—remains on to-day. I have already put a question. There is no satisfactory reply. If that taxation was placed on for one year, I want to know why it is on now, because it will be an accepted position, and it will bear tremendously heavily in 1933. That is not the worst. We have the twopenny postage. No country is ever prosperous when it is charging double for a service. I look at the budget, and I see that the twopenny postage in the Union and overseas is to be continued, and when I look at the post office I see a profit of close on half a million of money. I do not think there is an hon. member, or any one on the Government benches, who can stand up and speak on behalf of the post office as a profit-making business. Now that there is a chance of getting rid of these charges they are still there with us. I say that whatever else has been done that ought to have had attention. Now I come to some other items in this budget which we also placed on in taxation under the gold standard. There was no intention of the Government’s placing them on permanently, but they were to remain on for a particular time. I take rice. Special taxation was put on, and the proposal now is to leave it on. I can understand the Government putting a tax on sugar. You are doing something; you are making a few men rich. On wheat you are paying a few farmers and putting them in a comfortable position when everybody else is in distress; and by protecting the wheat farmer you have given us the dearest bread in the world. The Government may make that excuse in these instances, but there is none for rice, which is a staple food of the people. The tax was put on in a time of distress, and it is to be left on. In that regard the budget is a deep disappointment. Let me say it is a gambling budget. The Government know they are gambling on the price of gold, and who knows that gold will remain at its present price? You have an expenditure of 34 million pounds, and you hold on to these petty irritating taxes after the promise which was made with regard to them, and I do say it is not right. At the proper time I will make an appeal to the Acting Minister and show that there is no just logical reason why this taxation should be imposed, and I hope he will say these taxes are to be taken off and that some consideration is going to be given to the country. It merges into taxation. That means that the Government have deliberately made it a permanent tax notwithstanding the terrible position of the country to-day. The hon. member for Benoni (Mr. Madeley) mentioned the case of cigarettes. In a budget of this character, when millions of pounds are being handled, to put three halfpence on two ounces of cigarette tobacco is petty. You will only get £15,000 at the very most. With regard to our taxation through the customs, I say it is wicked. I want very briefly to look at the cost of this taxation and I want to apply it as far as possible to the cost of production in this country. We have heard Ministers advising the farmers “you must cut down your costs of production, you must compete in the world’s markets.” In the same breath, or at any rate in the same session, the cost of production was raised by increasing duties at the coast. There is no more pernicious taxation than duties through the customs for revenue. Out of £9,000,000, only £2,500,000 is for the protection of industry and £6,500,000 is really a tax on the people and is entirely for revenue. Year after year we have raised the cost of taxation through the customs to the people of this country. I will take the year 1923-’24, and I see that for ten years previous to that, we kept on raising the cost of customs. In 1923-’24, we imported £60,000,000 of merchandize and on that this country paid 11.1 per cent. There had been an increase of 30 per cent. over the previous six years. I quote that to show the steady increase in the imposition of customs taxation upon the country. Now I come to 1932. On £32,000,000 worth of imports, the people of South Africa paid 25.5 per cent. It is very difficult to find a precedent for this. This is a very highly taxed country in that regard. From 1923 to 1932 there was an increase of 250 per cent. on the customs in the nine years. Until these customs are wiped out, it is no use to say “cut down your costs of production.” First of all, you must take the beam out of your own eye. You have to wipe out this incidence of taxation for revenue through the customs, which taxes the whole of the people. One may perhaps look forward to a time when this gold premium may come again and if it is continuous I suggest to the Government that the first thing to do is to wipe out customs for revenue purposes. I would not suggest that you should wipe out customs which are levied in order to protect our own industries. That is perfectly reasonable, but this other form is the worst form of taxation. I will leave that matter there, but I hope that when we go into committee the acting Minister of Finance will see the injustice of it to the people of this country and that it will be wiped out. Just a word or two about our railway position. I am very pleased to hear that a commission is to be appointed, not only to enquire into the working of our railways, but sufficiently technical to give every part of the country justice. It is common knowledge that the rate from the coast to inland centres is composed of one-third costs and two-thirds overcharge. That is partly based upon the position worked out by the Cape Government Railways many years ago. It does not matter whether it is a trader or a farmer or anyone else, if they do not know the cost they are unable to fix a correct basis for the service which they give. I should like to say a word on unemployment. I know of the unemployment that exists in this country. I know that with the development of the gold-mining industry, unemployment is improving on the Witwatersrand. I believe if everything goes as we wish and this development does take place, then the legislation we are passing now will enable the industry to expand more and more and to produce a lower and lower grade. That is the cure for unemployment there. I have no fear at all for the working man, the man who is able to take up work on roads, but there is a big commercial class, a big clerical class, and there are the men who have occupied good positions but who cannot get any work to do. That is the difficulty in connection with unemployment, that is the class of man for whom nothing is done, and I welcome more and more the probability of this great expansion in the gold-mining industry, because I see no hope outside the gold-mining industry, for using this class of unemployed which I have just mentioned. That is all I have to say in regard to the budget. I hope that the thought which I have expressed, that is the thought for the future with regard to our farming community, will take root now and will come again in another session, and in another session after that, and I hope in order to help the people of the country in a legitimate way, in order to lay the foundations to enable us to compete in the world’s market, that the customs duties, the pernicious customs duties, these tremendously heavy duties which are for revenue purposes only, will disappear from the policy of the Government.

The Minister of Finance need not be afraid that I shall criticize adversely, but I would very much like to make a few remarks on the budget especially in relation to the wheat farmer. Together with others I am very thankful for the assistance which the Government is going to give to the farming population. I must compliment the Minister of Finance on having made such a thorough study of the Van der Horst scheme and practically accepting the chief portions of it. I think Dr. van der Horst was the first to have the idea that inasmuch as the Government can borrow money at 3½ per cent., the farmers could be assisted by the Government in relation to interest on bonds. I am very sorry that the Government did not go just a little further and decide also to accept the other part of Dr. van der Horst’s proposal to help the farmers especially in connection with the redemption of their mortgage debts. If that had been done, then we could have been so much the more thankful to the Government for these steps they had taken. Let me also express my acknowledgment to the Minister for his assistance to the wheat farmers. I understand the Government intends to give £120,000 to the Land Bank to meet the farmers or at any rate the cooperative societies. In the past the Government has encouraged the establishment of cooperative societies. The societies have lost terrible sums of late, partly owing to overproduction and partly, on account of the large importation of wheat which the Government permitted. Within twelve months 500,000 bags of wheat were quite unnecessarily allowed to enter the country but I assume that the figures the Government had were faulty, and that they did not want wilfully to injure the farmers. The fact remains, however, that over-production of wheat is due partly to the permits issued by the Government to the wheat importers at a time when we had quite enough wheat in the country. But now the Government wants to assist the co-operative societies in part in order to cover the expenses they have incurred. I say I am very thankful for it, but the Government does not go far enough. The Government has agreed to cover the expenditure which the Land Bank has incurred, or rather to cover the Land Bank against losses through the cooperative societies. But there are societies which have got advances from other banks as well, and it is no more than fair that where the farmers have, through their co-operative societies, obtained advances from commercial banks, those banks should also be indemnified against loss. If that is not done, the spirit of co-operation will be decreased in future instead of being increased. It seems now that the farmers get 17s. 6d. from the Treasury in order to allow the farmer to get 22s. 6d. a bag for his wheat through the co-operative societies. Originally more than one Minister advised the farmers not to sell their wheat under 22s. 6d. a bag, but in practice it appeared that the price of 22s. 6d. was not obtained. The societies were obliged to spend a great deal of money in the storage of wheat. There were costs of administration and interest. There was disease in the wheat such as weevil. Instead of 22s. 6d. a bag, the farmer got about 5s. less, and now I want to make this request to the Government. Inasmuch as the price of wheat is much less than they thought will they not in the first place be able to increase the amount of protection? The object of the Government originally, when it was decided to prohibit the introduction of wheat, was to prevent the farmer getting less than 22s. 6d. a bag. In practice it appeared that if the importation price is fixed at 22s. 6d. a bag, that the farmer gets practically 17s. 6d. In some cases it was a little more, in others again it was less, but we can, therefore, say that the farmer got round about 17s. 6d. A few years ago the Government appointed officials to enquire into the cost of producing wheat. They reported that they had made full enquiries in the districts of Malmesbury, Piquetberg, Caledon and Bredasdorp, and stated that you could not grow a bag of wheat in Malmesbury under 19s. 1d. The farmer, therefore, who sells his wheat for less than that loses the difference in proportion below that amount. The Prime Minister said that if there was one section of the farming population that could be regarded as prosperous it was the wheat farmers. No, even the wheat farmers are everything but prosperous. They sell their wheat with difficulty and what is sold is sold under the cost of production. I, therefore, ask the Government to increase the protection and I especially ask this because the protection to-day is a protection on paper. Last year if you spoke of protection up to 22s. 6d. a bag it was reckoned in gold because we were on the gold basis. This year it is a paper basis, because we are on the sterling basis. The customs tariff is therefore practically one-third less. Those are the two reasons I want to mention, firstly, that in consequence of the costs of administrative, and other, charges, the actual price of wheat to the farmer is 5s. cheaper than the import price which is considered as a basis. Secondly, that the protection last year was on the gold basis, while now it is on the paper basis.

Not a bag of wheat is imported.

It will occur again before long. If the protection is increased so that the import price amounts to 25s., it will mean that all will sell and buy on that basis. The fact that the Government thought that wheat should not come in under 22s. 6d. a bag meant that the Government thought that the farmer should get 22s. 6d. As I have shown he actually gets 17s. 6d. If the import price is now put at 25s., then everyone will sell and buy on that basis, and the actual price to the farmer will also be higher. The wheat farmer has to buy his superphosphates and other requirements. He imports his plant and he now has to pay much more for it than previously. A Malmesbury farmer told me that he paid £60 last year for a cutting machine. He ordered another this year and the price was put at £80. There you have a direct increase of £20 on a cutting machine only. So much for the concerns of the wheat farmer. I shall return to the matter on another occasion. Now I want to say a few words about what has been said about gold and the gold mines. It was said that we really ought not to tax the poor mine magnates so much. In all parts of the world people are searching for sources of revenue where they can get money to cover the costs of administering the country. There is only one country in the world which can say that, without damaging production, it can find revenue from a source to cover the national expenditure, and to reduce the taxation on the people. Our country produces more than half the gold of the world, I think it is 55 per cent. Now our Ministers last year repeatedly said that we must remain on gold, and if we could not, then the Government would appropriate to itself the profits made in consequence of our quitting gold. We had the Governor-General’s speech at the opening of Parliament last February when the Government announced that it was going to collect a large part of the exchange profits made by speculation which took place in consequence of our quitting the gold standard. We hear not a word of that now. What of the profits which Sir Abe Bailey and other mine magnates have made? We also hear that the Government cannot appropriate the full amount of the premium in consequence of quitting gold as we thought would be done. In connection with this I want to quote what the Prime Minister said in a speech at Benoni. His words were—

By that I understood that it would be all the extra profits, but now we learn that it is only going to be £6,000,000 out of the £18,000,000 to £20,000,000. Can that be claimed by the speculators? No, as the hon. member for Hospital (Mr. Henderson) said: “It is a lucky gift” for the mines which they never expected. The Minister of Finance fought along with me and all other supporters of the gold standard to prevent us quitting gold. He struggled for that and failed. But as we are off the gold standard now we ought to get the advantage as well as the disadvantage of it. The disadvantages are tremendous. Just read the speeches of the Prime Minister and the Minister of Finance in the past and you will see that a profit to the mines means a loss to the rest of the population. The extra amount gained by them is not due to them, but owing to having succeeded in their fight against the Minister of Finance. The mines could not expect the benefit of £19,000,000 to £20,000,000 inasmuch as the mining capitalists have, done no work for the premium. It was a “lucky gift.” But it is a lucky gift which the Government ought to appropriate for the sake of the rest of the population instead of only taking £6,000,000. I am now talking of the premium, not of the normal profits. We have a tax of 20 per cent. on the profits of the mines, but I want to point out that we took the 20 per cent. in gold last year, but now in paper, so that now we only get 8d. for every 1s. that we got formerly. People interested in the mining industry, moreover, did not expect that the Government would only take £6,000,000 because when interested persons asked me how much of the premium I thought the Government could take, I said £12,000,000. They said that was rather a lot, it ought to be £10,000,000. But now the Government only takes about one-third of the profits on the premium. If it were to allow a few millions to the mining magnates for the development of low-grade mines I would approve of it, but to allow about £14,000,000 is in my opinion a little too bad. In this connection I agree with the hon. member for Benoni (Mr. Madeley) when he says that the mines do not deserve that premium, but that it is the result of their fight and victory over the Minister of Finance. It does not belong to them, it belongs to the country. If it is said that we must not kick these people as they will become hopeless, I cannot understand it. Did the shares drop yesterday to last year’s level? No, it only made a small difference which is perhaps nothing more than a fluctuation in the market. But the shares would have dropped if the mines had got less out of the premium than what was expected. If the mine owners were merely people who belong to this country and live here I should be able to have a little sympathy with them, but as soon as they have made their fortunes they leave this country. Unfortunately they spend practically all the money they make here outside of our country. This means a loss to the country, because the gold which is taken out of the ground goes away and is an asset which never again returns. When minerals are discovered in England they immediately put a duty of 20 per cent. on the proceeds of mining those orcs, apart from the ordinary taxation. That is 4s. in the £; precisely what we claim in ordinary taxation from the gold mines. Why is the “royalty” demanded? Because the mining industry is not in the same position as agriculture, e.g., if a farmer plants a vineyard he improves the land; he does not take something out of it, but if a mine is exploited then the country is impoverished. That is the reason for the extra levy of 20 per cent. in England. It has indeed been said that 40 per cent. of the mine owners live in South Africa but if you look at the list you will find that persons like Sir Abe Bailey the hon. member for Kimberley (Sir Ernest Oppenheimer) and a number of other mining magnates included fill their pockets full here and when they are full they go overseas. I understand that three men recently became millionaires in consequence of the speculation. I can assure you that a section of the people who are making the big profits are only here temporarily. For example, the hon. member for Kimberley only comes here for the Parliamentary session, and Sir Abe Bailey visits South Africa now and then. Almost everyone of them goes overseas to spend the money they make here, and I have no sympathy with them. They do not spend their money in South Africa.

Why are you so prejudiced?

It is not a question of prejudice. If they do not spend the money in this country we should tax it. It is the law in Germany that if the pensioners do not spend all the money in Germany they receive 15 per cent. less. We should apply the same principle here. Thousands of people have come into this country with a bundle on their backs, but they have made a pile of money here and then gone away. There are numbers of people who came here without anything and left as millionaires. I want to make it plain that I have nothing against the mining capitalists as such. I think that if we can go so far as to put more taxation on them instead of reducing it, we shall be doing a very good thing. If we take £14,000,000 from the premium profits they will get off lightly. I mention this so that the Minister can make provision next year for a higher tax. I do not ask for this on my own behalf, but on behalf of the largest section of our people. I am in touch with many people outside Parliament and they are very angry that the largest part of the premium has gone into the pockets of the capitalists.

Who are the capitalists?

My hon. friend does not know who are the capitalists. I am actually speaking of the people who make their money here and then go overseas. Let me ask the hon. member for Kimberley how many months of the year he is in South Africa. He will say that he is not a South African that he comes here for a certain purpose. The Prime Minister laughs, but I remember that he was the first to speak of foreign adventurers. Today there is a derisive laugh on his face, but I speak of them as adventurers. If we were not in the parlous position we are in now I could have said, “Well, just give them that money”, but we absolutely require sources to get our revenue from, and the chief source is the mines. It is practically the only source we can draw on, and how are we not neglecting it. Now we have to use £2,000,000 out of the consolidated fund for current expenditure. I remember how my friends, the Prime Minister and the Minister of Finance, when Mr. Burton used £375,000 out of that same fund for current expenditure, made a noise: I did the same. I remember it very well. To-day the amount is much more. They are not merely taking £375,000. They are taking £2,000.000, and everyone is silent about it. I cannot remain silent. It is no use talking to-day because they will not make any change now, but am relieving my feelings. They are the feelings of thousands, and tens of thousands of the people, and when another budget is introduced next year they must remember that the thing is sticking in the throats of the people. Meanwhile whisky drinkers are conciliated, not the people who are suffering want. The provincial councils do not get relief. When they come to the Government and say: “The farmers cannot pay their taxation, it is impossible, give us a little help”, then the Government replied: “No, we cannot do it”, but the whisky drinkers are assisted, and they are not poor but rich people. That happens at the expense of wine farming, because people drink whisky instead of brandy. Someone said to me this morning: “Yes, but England will be annoyed with us if we put a heavy duty on whisky”. I pointed out to him that we were not now levying the tax, but that it had already existed a year, and that our import duty was not as high as the excise duty on whisky in England itself. The British Government cannot, therefore, be annoyed with us for taxing whisky. I feel very disappointed at the very small tax which is being placed upon the mines. Certainly the Minister of Finance got a severe drubbing in having to quit the gold standard. Together with him I have had a severe drubbing. But I thought at the time we would be compensated for that loss, we would take back what we had lost. But we are taking such a small amount that the mining magnates are laughing up their sleeve.

Business suspended at 6 p.m. and resumed at 8.5 p.m.

Evening Silting.

When my speech was interrupted I was showing the necessity for our using the opportunity we now had of getting more out of the profits of the mines than what the estimates propose. I thanked the Government for the help that was being offered to the farmers in more than one way, but I say that a good deal more could have been done. There is hardly one class of farmers which is not in a parlous position. There are the wheat farmers, who are represented as being in a better position than the other classes of producers, but even they are in a critical position. I think the Government could have done considerably more without borrowing money and increasing our national debt, which is already a little on the very high side. I recently read the opinion of a certain mining expert who thought that within sixteen years the yield of the mines would only be one-quarter of today’s production—about £10,000. If it is so that the yield of the mines in sixteen years will be one-quarter of the figures to-day, and if we look at the position the farmers are in to-day, then I ask what will be their position when that time comes. To-day we are one of the richest countries in the world, but yet we have the poorest population in the whole world. There must be a screw loose somewhere. If you ask me where it is then I will say that very little of the money the mines make circulates in South Africa. We borrow too much money, and use too little of the profits of the mines to pay our debts. We go the length of taking money from the consolidated revenue fund in order to cover current expenditure. I am rooted into our country; I am a father of children, and I must not only think of myself, but also of my posterity. I ask my friends on this side of the House and opposite who cannot go and look for a residence on the other side of the water to think as I do on this serious question. We have enough money here to-day to save the farmers. We are saving some of them by reducing the interest to 3½ per cent. but we are borrowing the money to do it. In other words we have to increase our national debt, a debt which will have to be paid later on by the farming population itself. We give with one hand, and take away from them with the other. We are going later on to get back from them that capital debt which is to-day being increased, interest and capital. It cannot be otherwise. Gold does not stop in the country when it is once taken away. The time must come sooner or later and it will probably come during the lifetime of several members of this House, that we shall find that the railways which are to-day concentrated at Johannesburg for the most part will be unnecessary because Johannesburg will be a diminishing town which has very little use for railways. The time must come. Who then is to bear the enormous railway debt? It must come from the permanent population of the country, viz., from the farmers. I say we have here a golden opportunity of assisting the farmers with the money from the mines. We can easily take a further £9,000,000 without the mines suffering. If I can get 10 per cent. profit on any of my investments I shall thank God. If I get 10 per cent. from money which I invested in the mines I will thank God. But the mining capitalists do not want 10 per cent., nor do they want 12 or 14 per cent. No, they want as much as possible. Unfortunately for us there are several representatives of that mining industry here who on every occasion you touch them a little get up and speak of injustice and unfairness, and then there are fools who believe it. I fully agree with the hon. member for Benoni that the extra profits belong to the country. I also agree with him that part of the profits are due to the people who develop the mines. I do not want to go so far as he does and say that so much should be given to them, because there are other classes that should also get some of that money. I consider it a crying injustice that when so much is being got we take so little of it. Eventually the farming population will have to stump up for the money which we are borrowing to-day to help them. It will be little use for me to move now that we should alter the matter this year, but I hope that next year the Minister will bear in mind what I have said and what the hon. member for Benoni and others have also said. We must take what belongs to us and use it. If we do so posterity will not curse us. I am pleading especially for them. If we do it, posterity will be thankful to us. I have not said these things to attack the Government but to make the Government appreciate what the serious views of the people in the country are. In speaking like this I am not only speaking from my own heart, but I am speaking out of the heart and mouth of thousands of people outside Parliament, and I do so in order that the Government may know what public opinion is.

As a young member for a constituency consisting chiefly of mine workers and at the same time representing I think five of the largest mines in the world, I feel to-night that it is my duty only to speak about the mines. In the first place, I think that the unemployed on the Witwatersrand are of the greatest importance to the country at the moment. The Witwatersrand population, especially in the East Rand, consists mostly of miners. We have three classes of persons there who to-day have unfortunately to be classified as unemployed. The first class is the miner himself. Before I come to that point I would like to say that I am a little disappointed that the Minister did not provide in his budget that, when giving the mines a certain subsidy to encourage them, and to extend the mining operations, did not compel them to absorb entirely the unemployed on the Witwatersrand. This means that they ought to take the unemployed off the shoulders of the Government. We have three persons: first the miner, who we have to-day, and who is an excellent fellow in his line of work, but unfortunately is on the streets. If he goes to the mines to ask for work he is told that there unfortunately is none. If we go back a few years we shall find that the miner only did one kind of work underground, that was to bring up quartz. To-day the position is that with the assistance which is given him a few hours to-day he undertakes the work of three people. Inasmuch as a subsidy is now being given to the mines for producing more quartz I think the mines should once more see that the work is done as before, and that the man should once more do only his special work, that of bringing up quartz. The other two persons who assisted him in the past is the one who took the quartz out of the blocks and the other looked after the pipe and railway line. If the mines, e.g., were to reinstate that 1¼ persons who did the work we should find that so far as the miners were concerned we should no longer have to look so far as the miners were concerned we should no longer have to look after them. The other person is the boy who is leaving school to-day. We find that as soon as he has the school-leaving certificate he goes to the school of mines. Before he goes he must of course have a doctor’s certificate. He is the pupil who leaves school and immediately goes to qualify as a miner at the school of mines. But then we get another kind of boy who not only has a school-leaving certificate, but who wants to go a little further to try and improve his future. They continue their studies a little and in my constituency, e.g., there are 25 to 30 boys who have matriculated who are walking about unemployed. If they ask the mines for work or to be engaged as an apprentice they are unfortunately rejected, apparently because the available work is reserved for certain boys. It seems to me, however, that if they want to study at the school of mines that the mines are then prepared to employ them, but when they have passed the matriculation then apparently there are no vacancies. I think that if the white artizan instead of taking a native to work with him were rather to take an apprentice then we would find that the boys after five or six years could all occupy positions which would be a credit to themselves and their country. Another group of people are those who have given the best years of their life to the mines; I refer of course to the sufferers from miners’ phthisis. Their position is so terrible that I think the Minister of Mines should give his special and urgent attention to the matter. We find that the man who has gone underground for a number of years is deprived of the right of going underground. They are paid out a few hundred pounds and then they unfortunately find that they are on the streets. A few months ago the late Minister of Justice suggested that the mining ground which was not used by the mines should be cut up and divided amongst the silicotics to enable them to cultivate it to build a house by which the Government can also save with the sums of money which are paid to these people, and with which they can practically do nothing. The money they now get only lasts for a few months and thereafter they are in the impossible position that they have to be content with what can be done for them in the future. If these people could be discharged on a monthly pension, like the old sufferers, or the third-grade sufferers, and put on the land, and so be enabled to start farming in a small way, then you will find that that person will be entirely off the hands of the Government. As for the mines, we have another class of people. It is the miner who has bought a stand in the village where he lives, built a house, and obtained a loan for that purpose from a building society. Fortunately we find that that farmer is assisted to-day by the rent due on their bonds being reduced to five per cent. In the towns we find, however, that 7½ to 8 per cent. and more has still to be paid to the building societies in the towns. In the towns we also have unemployed who have a house of their own, and do not want to lose it. I therefore cannot see why the Minister did not provide that not only the farmers should pay reduced interest on their farms, but also townspeople. One hon. member said this afternoon that we ought to have a fixed rate of interest of six per cent. I go further and ask why we cannot have a fixed rate of five per cent. on fixed property. Unfortunately we find—T believe that the Government has also had something to do with it— that there are unemployed in the village whom they have never been able to help, but to-day their motor lorries are parked together and they have nothing to do. They would be able to find a good deal more work in the municipalities with their lorries, but we find unfortunately that the Government prevent the people from doing something to help themselves. I hope the Minister concerned will see to it that any person who has anything by which they can earn something, shall be enabled to work and so diminish unemployment. In my municipality, e.g., we find that owing to the strict policy pursued, no lorry, or ox wagon, donkey wagon, can do transportation work in the village and lorries which were bought for that purpose they cannot use to-day. Outside of the village too there are people who possibly have a team of oxen who are also prevented from earning something. I hope the Minister of Mines will be so good as to give his immediate attention to the miners who have given their best years to the mines and that he will see the sufferers to-day can get other work, and in that way he will assist to rid the country of the unemployment position.

I am sure that those who have listened to the discussion to-day must have realized that the public of South Africa were mistaken when they suggested that one of the dangers of a coalition Government would be the absence of criticism in the House of Assembly. I think it will be realized by the public that probably on no occasion has there been such consistent criticism of the budget as on this occasion. In the past we witnessed members of the Opposition criticising the budget, while members on the Government side invariably defended it, to-day we are all free to express our criticisms, and those who approve of the budget feel no need to defend the Government, because they know perfectly well that the budget will be passed by an overwhelming majority. Even the hon. member for Piquetberg (Mr. de Waal), after having indulged in a very severe criticism of the budget—I do not think he had anything good to say about it— finished up by saying that naturally he was supporting the Government. So it seems to me that as far as the public are concerned they will have nothing to complain about. But there is another aspect. I think it will be generally admitted that only a coalition Government could have introduced a budget of this kind, because no Government without the support which the present Government has would have dared to do some of the things which undoubtedly will prove very unpopular. There can be no doubt that this is probably one of the most startling budgets ever presented to this House. It has startled the country into a realization of its dependence on the mining industry. One wonders what would have been the position of South Africa at the present time, but for the fact that the Government was able to take some £10,000,000 from the premium now available. One wonders what would have been the position of the country if that premium had not been made available by the policy of abandoning the gold standard. This budget also is in many respects a revolutionary budget. I think in many respects it will even satisfy the revolutionary ardour of the hon. member for Benoni (Mr. Madeley), because in this budget the Minister has laid it down, virtually as a policy, that contracts in so far as interest is concerned shall be modified in the interests of the farming population, and further, that, if need be, the actual capital value of land shall be reduced. I do not complain about that; I believe it is the right line for the Minister to have taken, that when the country demands bold action the Minister shall be prepared to take that action, even if it does not conform with some of his own theories. He has gone further, and this again is rather an innovation, in that he has laid it down that so far as mining taxation is concerned, the money derived from the mines is not merely taken as a matter of revenue but is taken in such a way as to enforce the working of low-grade ore. He has thus adopted the principle that, in future, the Government may utilize taxation so as to compel an industry to work its resources. The Minister has realized that the natural resources of the country should not be allowed to lie idle, but should be developed in the interests of the community. This is a principle which, under normal circumstances, the Minister might not have dared to introduce. Then it has been suggested—and I think it is probably true—that the budget is a somewhat disappointing budget. It has disappointed the hon. member for Benoni, for instance, and also the hon. member for Piquetberg, who is such an ardent supporter of the Government, inasmuch as the Government has not taken enough money from the mines. On the other hand, some hon. members are disappointed that perhaps too much has been taken. For my part, the disappointment I feel is that mentioned by the hon. member for Roodepoort (Col. Stallard) and others, that inadequate provision is being made in this budget for dealing with the problem of unemployment. The £750,000 which is provided is hopelessly inadequate to deal with the unemployment position which exists at the present moment. As the Minister has shown such boldness in dealing with other matters, and as he has taken £1,900,000 from loan funds, and put it into general revenue, one would have wished that he had taken another million and a half, which he is utilizing for reducing the interest payable by farmers, and applied it in providing for more public works, so as to absorb the unemployed, while at the same time doing work absolutely essential to the country. There could have been no great harm in the present state of the money market in debiting to loan account £1,500,000 for the interest subsidy for the farmers. I think most of us hope—and I am sure the Government itself hopes—that in the next budget it will make more definite provision for dealing with unemployment. While one realizes that the provision for unemployment is inadequate, there is the anomaly that while the urban unemployed are being practically neglected, the agricultural population is receiving the bulk of the money, which is being taken from the taxpayers. I do not object to substantial sums of money, even running into millions, being spent in order to assist the agricultural community, but it seems to me that while most farmers will be thankful for the money given to them, and will ask for more, in their hearts they are feeling that the money which is being spent is not being spent in such a manner as to save their position. In the first place the incidence of the relief seems to be wholly inequitable. It is going to help a certain number of farmers who probably, while requiring some help, are not in as bad a position as a large number of other farmers who have not got the adequate security and who will not therefore be helped under this scheme; and even so far as the farmers who are better off are concerned, I must say in looking at it from a business point of view that it doesn’t seem to me that the relief offered is really very material. I take by way of illustration the case of a farmer who has a bond on his farm of £1,000. What is he going to get under this provision? He is going to get l½ per cent. from the Government and 1½ per cent. from the mortgagee. So he will get £30. I must admit that I cannot for the life of me see that this £30 which he is going to get is going to make all the difference between ruin and salvation. That seems to be an important point, and I think that most of the farming population will agree that this £4,000,000 or more, which is to be spent on the agricultural population, might be spent in some more effective and more definite manner, and with a view to providing some real solution, and not merely be spent in order to provide doles, because in reality the farmer is going to get nothing more than an ordinary dole, which at the end of the year will leave him in exactly the same position as he was in before. Now I should like to say a few words on this question of the subsidy which I understand is to be continued. I would have wished that, if that assistance is to be continued, it would be done in a different manner because I do not believe that we can go on indefinitely granting export subsidies if we are to continue to develop trade with other countries. If we are to export our commodities to other parts of the commonwealth, I can scarcely believe that the other members of the commonwealth will agree to South Africa extending its export business on a basis under which the farmers here, who are in competition with farmers in other parts of the commonwealth, are getting a subsidy of that nature. I had hoped that the Government in view of that danger might have given that relief, which they now give by way of subsidy, in some other way, so as to obviate the possible danger of the commonwealth nations and other countries, with which we are dealing, raising objections. I do feel, and I think that most of our members here who represent farmers will agree that a farmer can only be saved by the prices of his commodities being raised. That has been partially done by means of our getting off the gold standard, but over and above that it will depend largely not on giving the farmer a reduction of 3 per cent. of bis interest—that is not going to raise the price level of his commodities —but on developing our own markets by developing the spending power of the country, and so helping the farmer and by continuing to extend to the fullest extent our export trade. In that regard may I express the hope that our representatives at the forthcoming world conference, who I am sure will endeavour to do everything that is best for South Africa, will keep before them the importance of not doing anything nor being party to anything being done nor committing us to anything which may minimize, jeopardize or weaken the advantages which we are getting under the Ottawa agreement as members of the commonwealth. I hope some preliminary arrangement will be made between the representatives of the commonwealth before anything is done in the direction of a tariff truce, which I do hope will be practicable for some years, so as to ensure that the agreement arrived at at Ottawa shall be entrenched and that nothing shall be done to jeopardize our markets. They must remember that the first essential is that all the advantages which we have under the Ottawa agreement shall be retained to South Africa. Now I want briefly to touch on this question of mining taxation. We know that something like 50 per cent. of the premium has been taken by the Government, and there is very considerable consternation on the part of some that the Government has taken as much as that, whereas on the other hand there is very considerable dissatisfaction on the part of the hon. member for Benoni and the hon. member for Piquetberg that the Government has not taken the whole of the premium. Now I may say that I for my part would have very much preferred an arrangement by which a much bigger portion of the premium could have been left in the hands of the mining industry. If it had been possible to have left that premium in the hands of the mining industry while ensuring that the money would be applied to the expansion of the industry and for the working of the low grade ore, I think a great deal more would have been achieved. I believe at present the most important need in South Africa is to extend the avenues of employment and I believe it would have been very much better for the country as a whole, not only for the miners but for every section of the population if it had been possible to utilize the full amount of the premium for the expansion of the mining industry, for the working of the low grade ore, and for the creation of employment for thousands. But I must candidly admit that I cannot see what machinery would have been available to the Government to enforce the utilization of that money for the working of the low grade ore, without some such tax as the one which they have imposed, which creates conditions to enforce the working of the low grade ore, and in those circumstances, while I do feel that on the face of it too substantial a sum has been taken, probably the Government has taken the middle course between the policy advocated by the hon. member for Benoni, and the policy advocated by those who are anxious that the bulk of the premium should be left in the hands of the mine owners. I believe that they have taken that course with the best intentions and that they have provided safeguards in their taxation proposals by which the balance which is left in the hands of the mining companies will be employed for the working of the low grade ore. It has been suggested that the Government’s policy may deter overseas capital from being invested for mining development. I believe the amount of money so far invested in the gold mining industry is not so considerable as many people seem to think. Certainly, millions of money are lying idle, particularly in Great Britain, and much of it is ready for investment in mining in South Africa. The reason that money has not yet been forthcoming is not because its owners did not know what the extent of the new taxation would be, but because they are waiting to see what the World Economic Conference in London will do. It is quite conceivable that investors would be very much affected as to manner of their utilization of their money should a decision be raeched by the Economic World Conference to return to a gold standard at a high parity. When the all-important matter of stabilizing world currency and fixing gold parity are discussed, at the World Economic Conference one hopes that our delegates will succeed in securing that that stabilization will be at a low parity, so that we can continue to get as high a price for our gold than we do at present. If we can get an even higher price, well, so much the better. As the chief gold-producing country our delegates will play a big part at the conference, but the prospects of our obtaining a return to the gold standard based on at least as high a price for gold as we receive at present, will be heightened by the fact that the Union of South Africa is a member of the British commonwealth of nations and therefore will have the support of Great Britain and the other members of the commonwealth. While dealing with the mining industry, I would like to refer to another point to which I trust the Minister of Mines will give his attention. I refer to the Mozambique Convention. People on the Rand are very much concerned with the effect of that convention, which contains at least two provisions which are of no benefit to the mining industry and harmful to the Witwatersrand and Natal. One of those conditions relates to deferred pay. I think a sum of one shilling a day is deducted from the pay of a native mine worker from the province of Mozambique and is sent back to that province so that the Portuguese may enjoy the benefit of the increased trade which follows from the circulation of that deferred pay when the mine workers return to their homes. The other provision guarantees that not less than 55 per cent. of the railway traffic to the Witwatersrand from the coast must be diverted to Delagoa Bay instead of going through Natal. That stipulation affects Natal and the Union railways prejudicially, because it means that a great deal of the railway traffic which otherwise would go from Durban to the Rand now travels over the shorter line from Lourenco Marques. It may be said that we shall jeopardize the interests of the mining industry if by means of a new convention we take away the advantages which the Portuguese at present enjoy. I believe, however, that the position in Mozambique to-day is such that, convention or no convention, the Portuguese would only be too happy to permit their natives to continue working on the gold mines. If, however, the Portuguese were to prohibit their natives from going to the mines and thus deprive themselves of the benefits they secure from the pay the natives obtain from the mines, the Union is in a position to obtain labour from north of latitude 22 degrees south. The old objection to recruiting natives from north of latitude 22 was based on health reasons. Medical science has made such advances that it is now generally admitted that this objection no longer applies. Knowing this I feel convinced that the Portuguese will agree to abrogate the two conditions to which I have referred, and still allow Mozambique natives to be employed by the gold mines. Although the budget is a disappointing one, it is not quite so disappointing as it would be in normal circumstances. In reality, it is an emergency budget. It does not lay down a definite policy to which the House or the Government is bound. It is simply an emergency budget to meet what we all trust is a temporary situation, and leaves the Government free to deal with the three great problems of unemployment, agricultural depression and poor whiteism. I hope that the Government will realize that it has been called into being to deal with these three very pressing problems. My conception of a national government is one to which Parliament does not relegate but delegate its powers to be exercised in consultation and co-operation. However able Ministers may be what the country requires is not individual ministerial effort but a national effort based on consultation and co-operation. I hope that between now and the introduction of the next budget the Government will take into consideration the suggestion of consultation and co-operation, and that in arriving at a policy to deal effectively with agricultural distress, and in arriving at a policy to deal effectively with unemployment, and to mitigate the evils of poor whiteism, the Government will cooperate and consult with others, and will establish something in the nature of an advisory agricultural council, and also an economic council, the latter consisting of men interested in industry and labour, and knowing something about these matters. I hope such a council as an economic council will be established to devise some policy for dealing with unemployment. The value of the Government’s work will depend upon their willingness and capacity to deal effectively with the agricultural position and with unemployment, and to do something definite, not only to check, but also to gradually eliminate poor whiteism. If the Government do this, the public of this country will be satisfied with a national Government. I hope the Government will realize that having been given the power and the opportunity of dealing adequately with the problems I have referred to they will seize this opportunity and fulfil the purpose for which they were placed in office.

I would not like the theme of my criticism of this budget to he misunderstood in the sense that my criticism of the small amount which is given to the towns for the relief of unemployments means that I think that the countryside is getting too much and the towns too little. I would like the countryside representatives to understand that I consider the provision inadequate in both cases. As you know, at the last election much use was made of the argument that unemployment would be combatted and that the matter would be tackled with great zeal. When we examine the estimates we find that a sum of £867,000 is provided for the very serious unemployment in the towns. Do you not consider that entirely out of proportion to the unemployment that exists? I do not even consider it as sufficient for my constituency. There are thousands of unemployed in it. It will possibly surprise hon. members who are not well acquainted with the unemployment but they will understand how absolutely inadequate the £867,000 is considering that in the heart of Johannesburg there are eight to ten thousand unemployed. I want to point out that as long as the purchasing power of the urban population is not increased all support which is given to the farmers will avail nothing. So long as the consumer is not able to buy the farmers produce the assistance given to the farmers will do no good. I do not mean by that that the farmers should not get the assistance, but it will always have to be given again and that practically means that for a time they will have to receive alms. Why should the producer be encouraged to produce more if there is no market, and no consumer who can buy the produce? The salvation of the farmer is the consumption. Will it increase the consumption if £867,000 is made available throughout the whole of South Africa for the prevention of unemployment? It is ridiculous to tell the country that the Government has voted £867,000 to relieve unemployment. It is no relief, it is a drop in the ocean. I ask, how can I go to my constituency and defend the Government which has made such an amount available while the promise was made and appeared in the newspaper reports that unemployment would be seriously tackled. Under the labour vote alone I find that £41,000 less is provided than last year. I got at the total of £867,000 by including the £251,000 which I suspect will eventually be used on the railways for unemployment. It is said that £1,000,000 is spent on unemployment on the railways. No, that also appeared on the estimates of last year. It is merely current expenditure. It is said that £3,000,000 is earmarked for unemployment, but this is where the pernicious misrepresentation comes in. It is an amount which was brought up last year and now the same amount is again brought up this year. It certainly is no new help for unemployment. It is ridiculous to regard it as a means of relieving the existing unemployment. I feel that the Department of Labour is an expensive one. If that department cannot convince the Government of the necessity to make more money available for the fighting of unemployment, then it is not only very expensive but also useless. The question may be asked where the money is to come from. If a plague or pest invades the country, or there is a revolution then money is found to deal with the matter. If such a serious thing threatens the people with destruction then a place is found whence the money can be scratched out. Here we are concerned with a serious matter. People go badly clad and underfed. A section of our people is going under and to protect that section we find that £800,000 is now being put on to the estimates. The people have to go about from house to house and they are practically learning to become vagabonds. They live in one house, and have to leave it because they cannot pay, and then on some pretext they go into another until they are put out of that. Does this conduce to a good character amongst our youths? And then we talk that we must build up a determined character in the Afrikander. I ask again whether the House thinks that this serious unemployment problem which is increasing can be fought with the amount on the estimates. No serious attempt is made to fight unemployment notwithstanding the fact that it is increasing. I hope the Government does not console itself with the fact that deposits in the savings banks have increased. That is due to some of the building societies having lost the confidence of the public who consequently deposit their savings in the post office. It is said that the scources of employment are exhausted. There are many places where work can be given to the unemployed. The House, however, must remember that the £800,000 is not exclusively intended for unemployed, but it also includes the capital expenditure which is necessary for equipment. That must all be paid for out of this amount, and I would like respectfully to ask the Government and the Minister concerned to explain to me how and in what way they intend to better the unemployment problem with this amount. It is not to be thought of that conditions for the farmers will improve as long as the purchasing power of the inhabitants of our country remain as poor as they are today. The mines are held up to us to-day as the sugar plum which must not be touched. It is said that a considerable amount of gold premium should be left to the gold mines so that they can extend their operations, that low-grade ore can be developed with the result that some of the unemployed will be absorbed. I do not know how much that will help. I do not know whether the Government is aware of it—and if it denies it, then it is not aware of it—but the mines will not absorb the out-of-work miners in that way. Many of them are unemployed, and if the mines absorb some of them in this way then it will only be an insignificant number. But is that an employment into which we want at present to send more of our young people? The fact that the price of gold has risen is in itself a cause for low-grade orc being worked. Where previously there was possibly a loss of 1s. on every ton of ore there will now possibly be a profit of 1s. or 2s. But what assurance have we that the gold premium will be used to extend the operations of the mines and that it will not be used to make capital expenditure in old mines which will be reopened and of which the timbering is rotten and which are falling into disrepair. It will cost thousands to reopen such mines once more, and it will also take a long time. Are the unemployed in the meantime to go hungry? Winter is on us and it threatens to be a heavier winter this year than we have known for many years. Are the people to go into this winter suffering a lack of bread, not being sufficiently clad, and many of them not even a roof over them. This is a serious question and does it receive the serious consideration it deserves? The question of urban unemployment is just as serious as that in the country. It is said that the farmer is threatened with ruin, and that there is a danger that he will lose all he possesses. The unemployed in the towns are not in that danger, because they have nothing more to lose. His only danger is that of death, and I ask again whether this serious question is receiving the attention it deserves? That is not the case at all. I even doubt whether hon. members of this House have noticed that only something over £800,000 has been made available for unemployment. I have spoken to members in the lobbies and they say: “No, millions are available for unemployment.” I do not know what size their millions are, but I rely on the figures which are officially published here. Perhaps they are reckoning in dollars. I will indicate another method of employing considerably more Europeans in the mines. I do not know why the previous Minister of Mines did not insist on the proportion between non-Europeans and Europeans in the mines being reduced. To-day it is 10.9 and we must reduce it to seven.

It is 9.2.

Thank you. Why cannot it be reduced to seven? That is not unfair and it will mean that some hundreds of miners will be absorbed. If then the argument is advanced what will become then of our natives that they will get no work, I reply that we should cancel the Mozambique Convention and then our natives can get a chance. There is no reason why we should alow so much money to go out to Mozambique while there is such a scarcity of money and lack of purchasing power amongst our own people. Why should we import workmen from elsewhere while our own people are looking for it. The sooner we look this fact in the face the better, and the sooner we tackle these difficulties the better. For years now it has become the custom for me to get myself disliked in this House by raising the question of silicosis. This is the fifth year that I have been a member of Parliament and it has been my duty every year to bring this question up because it does not receive the attention it deserves. Something should have been done for these people long since and if there never was a time that we could no longer trifle with this question then it has now arrived. If we trifle with it any longer then those people will feel urged on to something which will be very unpleasant for the inhabitants of South Africa as has already taken place on a previous occasion. There is no reason why the Bill to improve their position cannot still be brought forward, and why it cannot come up now. There is no reason why the amending Bill to amend the Miners’ Phthisis Act cannot yet be dealt with. The Minister was unfair in not bringing it up in the House, and the measure has not received its rightful attention from the Department of Mines, because the department is not yet able to tell us what is intended by the measure, and what is aimed at in connection with silicosis. I have previously given the invitation here and I now again invite every member of this House, or any Minister to go and look for themselves if they have not yet seen how the silicotics are suffering. They should go and see what a miserable life they have to lead. They have worked for 12 years underground, worked very hard, for which they receive pay which is not at all equal to that of a public servant. He has to work for pay which only allows him to live and to save nothing, and when the period has passed he is only given a small amount of compensation. If after that time he has received compensation he is thrown on the streets, kicked out and boycotted, and the compensation he has received is not nearly as large as the pension which the public servant receives. What is the result when the man has worked 12 years underground? He already is a wreck but now he becomes a dog of society as well. He has a wife and children, and he has the same desire to educate and bring up his children to be useful members of society, and to be a pleasure for him and his home, like any member of Parliament or mine magnate here. And what more do we find in connection with the position. We find that the pleading voices of his wife and children are not listened to in comparison with the wailing of others for assistance. Go and seek those houses of the people for yourselves, and see also what misery they are living in. The people who once were the flower of the land have after 12 years of exposure to the weather and hardship on the mines have lost their health. They have been ordered by legislation to go out of the mines when they have silicosis. £300 is given to them and they are told: “You must get out.” Why did not the House at once pass an Act to shoot these people? It would not have been much worse. Now they have to live miserably and have to see the distress of their wives and children owing to their not being able to maintain them. The women cannot go to church, and the daughters cannot go to school, because where are they to get the clothes and stockings from? They dare not exhibit themselves, and now the Minister says he cannot introduce legislation now, he must wait until January to introduce it, because he is afraid that the House will not pass the Bill as it stands now. That simply means that the House concurs in those people remaining in great distress. To-day a fight is going on and lots are being drawn for: that money which is made out of the mines. What is that money? It is the pain and the blood of the life of thousands of people who are being ruined to-day on the Rand, of people who are in indescribable misery. What will the House do? What does the Government want to do? Whatever the Government does it cannot wash out the disgrace of its action towards those people in the past. Who can imagine to what extent the unrest of the people will increase in consequence of this trifling with their feelings. And if riots come will there not then be millions of pounds available for the sending of aeroplanes, guns, to put down the disturbances with bullets and powder? Can that money not be better used now to relieve the miserable existence of those people? We are trifling with those people, and with fire. It is fire which cannot be extinguished with water but it will cost blood. I warn the House to-night that if we do not want to see those things happening we must say good-bye to this high politics, and get back from this policy of the higher circles to the policy of bread and butter. I hope I am not speaking unnecessarily to-night and I hope that the depth of my seriousness will be appreciated and if not that someone will go out of this House and have an enquiry made into what I have stated here and find out whether it is correct, and whether I have, not expressed myself too mildly. If he should find that the conditions have been incorrectly described by me then I promise never to put my foot in this House again or to open my mouth. But at the same time I ask my hon. friends who want to oppose this attitude of mine, if they find things are as I have stated will do what I ask of them.

Will you sign a document?

People who joke about such a serious matter are like people who sing stupid songs while the Minister is praying, or who play a mouth organ during divine service. It is precisely the same thing. Then there is also a very serious question needing attention, it is our old people. We are all pleased about the Old Age Pension Act, but there are a few respects where it is too severe, viz., that the police can go and can make reports whether the people should get pensions or not. Some of the police are new at their work and do not know the meaning of some words, with the result that they prepare a wrong report which causes the old people to lose their pension. I do not consider the police competent to decide whether the people should get a pension or not. Sometimes the people lose their pension for a few months. Welfare officers should be appointed whose position should be such that they need never be afraid of doing their duty. They must be in touch with the people and inform the Government as to the real position. They must not be like some commissions that are appointed, the members of which have never yet done any work. They must remain in constant touch with the people, and not work on theory. Moreover, the law provides that if some of the children of the old people are employed, and earn a certain salary, they must support the old people. I have nothing against it but then the burden is thrown on the old people of prosecuting the children if they refuse to do it. There are cases where children earn £20 a month, but those children also have ambitions, they buy a house, e.g., and have to pay for it, so that they cannot save the £1 or £2 a month to give to their parents. Nothing of that sort, however, is taken into consideration. I think they are matters which should be considered. I also think that it is a matter which ought to be reviewed. It is a shame to see how some of the old people can get no pension while the children possibly own four houses. I am making this criticism not because I am against the Act, but because I am opposed to the way it is administered. Then I would like to call the attention of the Minister of Railways to the condition of the railwaymen at Kazerne. They clean the trucks there, and for economy the oiljackets which the labourers use in cleaning out the trucks are taken away, and old bucksails, which are no longer suitable for covering the trucks are cut up and used to protect them against the water. Just imagine the sheets are no longer good enough to protect the trucks, but they can keep the bodies of the workmen dry. Is it a wonder that the people after working all day under such conditions are wet to the bone and become ill? They have only poor accommodation which is dirty, and there they have to dress, eat, and sit, and it is plain that their health is neglected in every respect. After they have cleaned the trucks they have to stand up to their knees in water, and take everything away in wheelbarrows. Is it a wonder that their joints crack and they become ill? But when they become ill they are discharged. This is another case of people who have to do the dirty work, and as soon as it causes their illness, that they can no longer do the work, they are discharged and told that they are of no further use. Then I would like the Minister of Railways to consider the position of the white labourers up there. When they go on leave six days a year without pay they have to vacate the railway cottage for that period, or otherwise they have to pay rent. Therefore, although they are drawing no pay they yet have to pay rent for the cottage. I consider the Minister should give his attention to this matter, and not only let the people off the rent for the week, but also give them their pay. It is surely not too much to give them a holiday for one week a year? Then I would like the Government, after Ministers have met, to find means of getting a few millions for unemployment, to consider the question of not putting the wages of the public service under 10s. a day. If the Government consider that, then I am certain that within six months after their wages have been paid the farmers will hold a celebration, and from all parts of the country the Government will be invited to congratulate them. Then I also hope that the Minister of Labour will pay attention to the coming in of unemployed from other places. We find that when assistance is given to unemployed, people stream in from other towns along the Rand, and even from elsewhere to such a town. A town which wants to assist in solving unemployment questions, employs, e.g., 1,000 people with the assistance of a subsidy, but the following day there are 2,000 unemployed asking for work, and if they are given work then the following day there are 3,000 to 4,000, at such a speed do they come in from other places. I hope that some means or other will be introduced and that care will be taken that a town would only have to provide for the unemployed living in it. If that is done, then the large towns can make sufficient provision, and make better provision to assist the unemployed than they do to-day. I want to thank you, Mr. Speaker, for having listened so patiently, and close with these remarks.

As was correctly said the other day by the hon. member for Boksburg (Mr. Bouwer), the deputy leader and Whip of the Roos party in this House—at least 50,000 voters in the Union expect him and me to take part in this debate, and we both of us feel this very great responsibility which has been thrust upon us by circumstances, and among those circumstances I reckon the mistake made by some 600 voters living in the more inaccessible and less enlightened parts of the bushveld of Rustenburg. The platform on which I fought the election of Jeppes, and won that election, was that I was in favour of coalition, and I am still in favour of coalition. The hon. member for Albert (Mr. Steytler) and myself were at one time the only members of the Nationalist partv in favour of coalition, when all the other members of the Nationalist party were dead against it. It did not need the eloquence of the right hon. member for Standerton (the Minister of Justice) to persuade me. It did not need the threat of an adverse vote in this House, it did not need the fear of losing a general election to persuade me. No, I was persuaded right from the start and I said so openly and publicly. I did not first argue for hours and with bitterness that coalition was a crime and that it was Afrikander treason and then turn round to commit coalition. I did not say as the Prime Minister did at the beginning of February, I quote from “Hansard,” “no, along the way of coalition there is nothing to be obtained for the people of South Africa, at any rate for that section that are honourable and honest.” Doubtless he was referring to the unconditionals. That was what the Prime Minister said in the beginning of February, yet before the end of that shortest of all months, he turned round and entered into this coalition which he so deeply despised. But I am very glad that the Prime Minister did so, whatever his personal motives may have been, I am glad he entered into coalition, because the result which Mr. Roos so much desired has now been achieved. By coalition two of the great impediments to national progress have been done away with for ever, and those impediments are racial strife and the personal bickering of two great men. Let us rejoice that those two great men have seen the error of their way, let us rejoice that they have now been able to join hands and that they will for the future be able to devote all their energies for the benefit of this sunny land of ours. I now come to the budget. I have honestly done my best as a good opposition to find fault with the budget, but I have not been able to find any serious faults in it. That is, in so far as this budget does go. I shall just now point out various items which I think the budget should have contained. However, as far as the budget goes, I cordially support it. I promised the intelligent voters of Jeppes that I would support the Government in every step it took, which was calculated to bring prosperity back to South Africa. I believe this budget is calculated to do that, and is an honest attempt at doing that. That is why I and my whole party are going to support it. The Roos party wishes to give this Government every fair chance. Of course I do not agree with all the arguments used by the Minister of Finance. One so often sees a correct decision given based on incorrect arguments. We, in our profession, do not mind that very much, provided the decision happens to carry costs. The Minister of Finance, in his budget speech, said—

Surely the Minister should know that when people buy shares they do so hoping that they will rise, but not caring why they rise. All these people who bought gold shares, especially those who purchased after the interesting event of December 16th last year, expected a rise because of the gold premium. How the Minister can say that that is not a factor in inducing them to sink their money in shares, I fail to understand. For that reason I cannot agree with him when he said—

Surely that money belongs just as much to the shareholders us any increased value which may attach to my farm as a result of gold being found there belongs to me. There is one other point on which I do not agree with him, when he said—•

Let me assure the country that only as the result of the elimination of sharp party divisions has it been possible to bring forward these proposals.

If these proposals had been brought forward before the election, then he might have been able to say so, but at present he cannot say so. What he really should have said was that the Nationalist party never had a majority after January last. As a matter of fact, there is no longer a national party in this House. There is no national party. There is only a Hertzog party which consists of the 16 faithfuls’ from the Free State, the unconditionals from the Transvaal, I believe the hon. member for Ceres (Mr. Roux) from the Cape and three from Natal. But I shall not discuss Natal. As far as the budget goes, I agree with it. I think the Minister is very wise in not taking more than he does from the gold mines, and in not taking less. There is every incentive left to the mines to extend their operations, and the Government’s proposal also leaves a fair portion to the shareholders. I agree with the Minister that it is really most wonderful that in this time of depression he has been able to obtain so large an amount from one single source— a source which can afford to pay. I think the Minister should really have closed his budget speech by saying, “Thank God, for the gold mines !” The Minister of Finance has balanced his budget, but why should his budget balance? What is the necessity for trying to wipe out the whole of the accumulated deficits of three or four years in one year? The Miniser would have been better advised if he had budgeted for a deficit of £1,000,000 or £2,000,000. If he had done that, he could have used the money thus set free for the benefit of miners’ phthisis sufferers, but I do not wish to speak about that, because the hon. member for Boksburg (Mr. Bouwer) is going to deal with it more in detail. I am very glad the farmers are getting what they are getting. Speaking as a member for a town constituency, I may say that we do not begrudge the farmers a single penny of what they are going to receive, but we do feel that the townspeople have been utterly left out of the budget. The townspeople have felt the de pression just as much as the farmers have. People with small incomes, such as small traders, mechanics, professional men, and people on small salaries, have all felt the depression very much, and if their income tax could have been reduced a bit, they would have been very grateful. The people to whom I have referred are the backbone of the towns, and they deserve assistance, just as much as the farmers do. The people of the towns, especially those I have mentioned, and especially the wage-earners, have got nothing out of the budget or the gold premiums which the Minister rightly calls a windfall. If the Minister had kept £2,000,000 in hand, he could have reduced these people’s income tax, and he could also have returned to penny postage, and the State would gain rather than loose by that reduction. Recently. I had to distribute some 5.000 circulars—very interesting circulars, circulars that certainly brought results. I had them distributed by hand at less than it would have cost to post them, but I promise that if the penny postage comes back at the next election that is after 18 months or two years, I shall post these circulars. I do not believe the Minister wanted to injure the poor man purposely, but he has done so by putting an unnecessary tax on cigarette tobacco, by means of which he hopes to obtain a paltry £15,000. This will press very hardly upon the poor man. That is the man who probably has found that the factory-made cigarettes were getting thinner and thinner and shorter and shorter. Probably in order to protect himself, he went along and bought one of those little machines for rolling his own cigarettes in order to save money. Now the Minister is forcing him to buy factory-made cigarettes. I don’t know why he is doing it Wherever there is smoke, even if it is only cigarette smoke, there is fire. Then whisky is reduced by 5s. a case, which is 5d. a bottle. Reckoning 20 tots to the bottle, that is one farthing a tot. Even if a man is thirsty, and gets no more than ten tots from a bottle, it still works out at only a halfpenny. The consumer will not benefit because it will not be passed on. Therefore all that the Minister has done is to make a present of £25,000 to the whisky people. I don’t see why that should be done. If he had money in hand he should have reduced the tax on rice and tea, for then the poor people would have got some benefit from it. I am very glad that the interest on the bonds of the farmer has been reduced, but why only to the farmer? Why have not all bonds been reduced to 5 per cent.? It could easily be done. All that the Minister need do—he is already doing it for the farmer—is to take, by way of a tax, the whole excess of any interest over 5 per cent. Then all bonds would be reduced to 5 per cent. The State would lose nothing, and the ordinary bondholder would be glad to receive 5 per cent. In Europe he receives much less. Only this morning I received a notification from my building society, in which I believe I have about £16, reducing the interest from 4 per cent. to 3½ per cent. If all bonds are reduced to 5 per cent. the farmers’ bonds will not be called up so readily. What will the bondholder do with his money if he can only get 5 per cent. anywhere? Apart from these few criticisms, which are sincerely meant, I and my party will support this the first budget of the Coalition Government with cordiality, and we are going to support this Coalition Government as long as we can honestly do so. It will only be when we can no longer honestly do so —

Then you will resign.

No. Not being an unconditional, I am not going to resign then. When I can no longer honestly support the Government, I am going to vote against them.

I have a certain hesitation in speaking to-night. I am too stupid for a diplomat, therefore I have to be honest. If possibly I mention the names of Ministers here and there, then I ask them not to consider it merely as arguments ad hominem, but that because I want to bring serious matters to their attention. I would be very wrong if I did not frankly admit the gratitude of the farmers for the attempt the Government has made to relieve their burdens. I should also be dishonest to myself and to the farmers, because we still have some feeling of honour, if I did not here express my disappointment at certain aspects of the budget. One should never look a gift horse in the mouth. The farmers have never asked for gifts, and you must therefore permit me to look this gift horse in the mouth. I want in starting to express my disappointment that the budget does not provide for certain things. Our farmers have had to bear heavy burdens, and many of us have dropped out by the way, because we could hold out no longer. If relief had not come to-day still more of us would have dropped out. Many of the farmers who have gone under are to-day on the roads, while others are still on farms that they have leased. Those people will be only too glad to get back to the farmers and to apply for land if they are given the chance. It is, however, laid down that they must be able to pay 10 per cent. of the purchase price of the land, and that the people are unable to do. This makes it impossible for them to apply for assistance. I think provision ought to have been made for those cases, so that those people should not have to find the 10 per cent. If it is not done I do not see how they can ever be brought back on to the land. I feel it is very unfair to those people, because they possibly cannot hold out for many months more. Because they dropped out three months before this legislation they are now ruined, while we lucky ones who could hold out a little longer are saved. I am, therefore, to-night pleading for those two classes, those who have to work on the roads, and those on leased property, both of which classes are anxious to have their own land. Less than three weeks ago I was at an auction sale where a farm with good ground was sold for less than £2 a morgen. It is land for which in good times the owner paid £10, and would not have sold it for £10 a morgen, land which in normal times would fetch £6 a morgen at any time, but for which he now cannot get £2. The Land Bank had a bond of £1,308 over a farm, and a merchant who had a small second bond over the land advanced a further £2, and bought in the farm for £1,310, land which the owner in the good times would not have sold at under £10 a morgen. Provision is not sufficiently made for our agricultural credit associations. I am very glad that the joint liability has been taken away. I hope, however, that the Government will go a little further in assisting the associations. I have received instructions from my constituents and I think that the hon. members for Bethal (Mr. Jooste) and Ermelo (Col.-Cdt. Collins) would have been similarly instructed if they had asked the views of their constituents. I, therefore, hope that they will support me when I ask the Government to go further, and not only to abolish the joint liability but also to write down the debts of persons pro rata as the assets have dropped through circumstances over which they had no control. I hope hon. members will support me in this proposal. Now I want to touch upon a point which I know will be opposed by all the advocates and attorneys. It is in connection with the subsidy. I want to point out that the Minister of Railways, shortly before we quitted the gold standard according to my information, went about in the Piet Retief district and told the wool farmers, “Sell your wool, the Government will in no case go off the gold standard.” Some people sold their wool, and others did so a month later when we were off gold. The former, of course, got 25 per cent. less for their wool than those who sold later. I know that we cannot go so far as to say that all the people who sold before we quitted gold should now get an extra subsidy, but in this case there was only a difference of one month, and people only shear once in the year, and the people were punished for following the Minister’s advice. The farmers, therefore, unanimously ask that these people should get an extra subsidy of 25 per cent. That is a thing for which the budget does not provide. Before I go into the matters which are dealt with in the budget I want in view of certain figures to ask what the cause of the parlous position in which we are now, was a position which has brought the best farmers to the verge of bankruptcy. Hon. members know all the facts just as well as I do. I am only mentioning it because I want to enquire how far we can remove those causes. In the first place the war debts are responsible for the position. We can do nothing to that. A second cause is the tariff walls. We are sending our delegates to the economic conference where they can assist in pulling down those walls. A third cause is considered to be the mechanization of the whole world. I cannot say how far that statement is true. In my opinion machinery should assist in giving the people more rest and mental refreshment. So long, however, as great thinkers differ on the question of whether it is a curse or a blessing, we had better leave it alone and concentrate on points which we can judge of, and where we can remove difficulties. Ghandi, e.g., says that we must go back to the spinning wheel, and Chesterton in England says. “Break up the machinery”. On the other hand we find that some time ago Edison did not want to die because he wanted to make more machines. We know that Ghandi is considered as a saint, but is Edison a blackguard? These examples show that we cannot judge of those matters. In view of the figures, however, I would like to point out causes in respect of which we can do something. I have got the figures from the Economic Congress which was held about eighteen months ago. As the position is so serious eighteen months seem a long time ago, but it makes no difference to the argument. At that congress one of the greatest economists came to the conclusion that the farmers had paid too much for land. He said: “We are very sorry but those farmers had better go under and the younger farmers can then buy the land cheaply.” That is the argument of a professor who has to make his light shine for the students of Stellenbosch. I would just like to ask what youth would like to get his land in that way from his parents? Hon. members will possibly know how before the war farmers got from 1s. to 15d. for a lb. of wool. We find that if we take the index figure of export produce during 1914 as 1,000 it amounted in 1924 to 2,022. It was partly in consequence of the war and partly owing to our quitting gold. That was the time when the farmers got 2s. 6d. to 3s. for a lb. of wool. Why did the farmers get such high prices for their wool, maize and other produce? Is it because the warmth capacity of the wool suddenly increased, or because the feeding value of maize increased so much? No, the point is that although it was never explained to us the purchasing power of the South African £ has dropped to 10s., and the farmers have norrowed those cheap pounds. Neither the economic experts nor the Governments nor the Opposition warned us at that time, saying that those pounds we were borrowing were cheap pounds, and we would have to repay them with dear pounds. I can remember a show at which there were more than half a dozen experts, there were experts for sheep, two for cattle, one for horses, one for pigs, and even one for dogs. All of them advised the farmers to produce more and better; farmers then extended their operations owing to which they got into trouble. The reproach is made that at that time, when they got good prices, all the money was spent on motor cars. I recently heard in the lobby somebody mentioning Riversdale. I do not know whether it was the hon. member for Riversdale (Mr. Badenhorst), but someone said that the farmers of Riversdale were indeed suffering but not yet so severely because they did not buy any motor cars. If the name of that constituency indicates the nature of the area, then it is a valley which is full of rivers, and then it is a land of milk and honey. I can give him the assurance that we have nothing but desert, and if there is honey it is wild honey and locusts. There are, however, persons who know better who say so, and I now want to stop that rubbish. If a farmer wants his sheep to give more wool, his cows to give more milk, and his lands to yield more maize, then it is not an automatic matter. If he wants more wool he must use better rams; if he wants more milk he must buy better bulls, and if he wants more maize he must plough up more land or buy a tractor to plough his lands more often and cultivate them better. The fact that today there is much more of that produce being produced is the best proof that the capital which the farmer made so easily in those days, and, alas, also borrowed so easily, was in fact actually used for bringing about that extra production. We cannot have our cake and cat it. If the farmers use the money to buy motor cars, then they cannot have it for producing more. The extra production is actually the proof that the capital was used to increase the riches of the land in that way, and it is just that progressive farmer who is feeling the pinch to-day and in trouble. At that time if a farmer wanted to pay off a debt then he only needed to have 12 lbs. of wool, but to-day he requires considerably more. In the year 1924 the index figure was 2,022. In the year 1931 it dropped for export prices to 794. That was the time when we got 4d., 5d., and less for our wool. The figure of 794 means a drop of 20 per cent. on the 1914 figures, and 120 per cent. on the figures for 1924. If the farmer wanted in 1931 to redeem a. £ of his debt, then he did not require 12 lbs. of wool, but 60 lbs. In other words, in terms of wool he had to pay five times as much as before. But we find that it was just then that the banks said: “Come along, my boy, reduce your obligations.” What then is the solution of this difficulty? If we take the figure for 1924, when high prices were paid for produce, we find that that was the time that the value of the £ dropped to bedrock. If we take 1931 we find that the farmers got practically nothing for their produce because the £ had gone up to the top. If you plant a stick by the side of water the higher the top is the lower is its reflection in the water. The dearer money has become the lower produce has dropped in terms of money. How then are we to go to work to bring the top of the stick nearer to the reflection in the water? The answer is that we must cut the stick down. The only way to get higher prices for produce is the devaluation of the money unit. Throughout the whole world it is said that conditions will not improve before the price of produce is better on the world market. Experts agree on that point. The solution can, therefore, be logically inferred from that. In order to get it the money unit must be devalued. It may be said that this has nothing to do with the budget, but it has everything to do with the parlous condition the country is in. One of our Ministers is going soon to the Economic World Conference, and I hope that he is there going to advocate devaluation. The question arises why it was not done before. There are many arguments against it. The first is the misapprehension which exists that money is riches. The hon. member for Benoni (Mr. Madeley) said the same thing to-day. I do not know if he was serious, and it always pains me when people are not serious about serious things. He said, however, that things would not right themselves before we get rid of the misapprehension that money is not riches. Money is not riches. It is nothing but a means of exchange, the oil which makes the wheels of our distribution machinery run well. If it is regarded as wealth then it is no longer a blessing to the country but a curse. The actual wealth we have is the things that we possess to keep us alive. We are all the torch bearers of that spark of life. The food that we need, our clothing, and our land is our wealth which we have to use, but it is because we hold on to the misapprehension that money is wealth, and that as such it is sacred, that we will not touch it and go in for devaluation. That is one of the reasons why we could not devaluate. Secondly, the argument of the widow and orphan is also used very much. It is said that people who have invested money will suffer if we devaluate. I was glad to learn from the Minister of Finance yesterday that the purchasing power of the people who had invested money, as well as the purchasing power of persons in receipt of salaries and wages, was higher and stronger and greater and that if you devaluate the money of the widow and orphan you are merely bringing it back to the previous purchasing power it had. It was also said that the wage earners would be injured. If money is devaluated then we can link up the wages with the index figure, and then the wage earner cannot be injured. If we take the average figure as 1,000 in 1914 then we find that the figure for 1924 is 2,024. The necessaries of life then was 1,330 and in 1931 when the figure for export prices had dropped to 794 we find that the index figure for necessaries of life had dropped to 1,217. The conclusion from this is that the figures for the necessaries of life do not exactly drop or rise to the same extent as the export prices drop or rise. If you devaluate and the primary producers get higher prices for their produce then you do not injure the wage earner to the same extent. But the difficulty can be overcome by linking up the salaries and wages with the index figure. An opposing argument was until after the World Economic conference. It was always strange to me that we had to maintain our economic independence. Or rather I will put it this way, that we should remain at all costs on the gold standard, which certainly damaged our primary producers very much, in order to remain economically independent. But here where the farmers are being greatly injured we cannot intervene. Let us take this step. I consider it as one of the most necessary steps if we want to get the primary producers of this country back to their legitimate place. Why are we talking to-day about devaluation? It is because we have all felt in ourselves where we are being hurt. The advisers of the Minister of Finance heard this and knew that we were being hurt. But the patient in this respect is cleverer than the doctor because he knows exactly where he feels the pain, while the doctor may possibly infer wrongly. I mentioned those index figures and pointed out that if we had done it the result would have been that our position to-day would have been different. In 1914 we should have paid from six to seven per cent., but in 1924 we might have been able to pay 12 per cent. interest, because the index figure had risen. We would have been able to pay that better than eight per cent. subsequently. That would have had the benefit that it would have killed the wild speculation, because no one would borrow money at 12 per cent. What was the actual position of things when according to the index figure of 1931 we actually had to pay three or four per cent. interest, did the banks push it up to eight per cent.? I ask you whether it is not remarkable that the farmers of South Africa did not one after the other come on to the verge of destruction. To me it is a great wonder that they did not all go insolvent, I know that if I ask for the interest to be tied up to the index figure that I shall be told, “You are speaking against the economic law of supply and demand. You want to go against nature.” I want to emphasize this many of the laws are not made with a view to the interest of the farmers of South Africa, but exclusively by the financial world which have not always borne in mind throughout the condition as it is in South Africa. I just want to say that if we always follow the law of nature we must assume that the handsomest and strongest man may have more than one wife. He is, however, prohibited by our law from having more than one wife. Another thing which has been referred to is the sacredness of contracts. But every contract surely consists of more than one consideration, and if there are factors which are demanded by the contract, owing to which the other parties will become completely bankrupt, I feel it is necessary that you should interfere with that contract. When I spoke in 1931 and advocated a reduction of rates of interest and devaluation “Die Burger” said that it was exclusively a matter for the financiers and moneylenders. “Die Burgei’” had no other matters to write about than spring love, moonshine, and the smell of roses. That was at a time when our people were in a terrible condition. A few months ago “Die Burger,” however, brought forward an economic scheme which, in my opinion, was calculated to save the farmers. It was one by Dr. van der Horst which was calculated to release the farmers from their mortgage debts and to make them independent once again. But what do we find in a Transvaal newspaper? The paper inveighs against the scheme not just because it was a bad one economically, but merely because it appeared in a newspaper which is the mouthpiece of a person who is not a persona grata. The newspaper did not attack the scheme on its merits, but because it appeared in another paper, that was “Die Vaderland.” We buy that paper for 2d., but I do not think it is a good investment of your money, because if you follow the financial policy of those papers it is wasting money to buy them. I feel that there are certain things against which I must protest. The scheme of the Government is merely a temporary one. It is not of a permanent nature, and does not touch the root of the matter. The underlying characteristics of the other scheme are that the farmers have the right of demanding that they also shall be able to borrow in the financial world at the same interest as the rest of the world. The farmers are entitled to demand that they should have the right of competing with the rest of the world. They are the producers of the wealth of the world, and Dr. van der Horst’s scheme provides that the farmer can compete in the world. Here I feel that the farmer has always hitherto had the right of demanding this. What I feel is that as money is to-day available in the world at 3½per cent., and as the farmers are really the producers of wealth, if they are not it is no use talking about the matter any more, we must enable them also to borrow money at that rate of interest. I am convinced in my heart that they are the producers of the wealth of the world. Parliament as such does not produce and from this point of view I consider the capable farmer, Gen. Smuts, of Irene, is a much more useful member of society than the Minister of Justice. Tn a publication of the Department of Labour it was recently pointed out what a necessary member of society the farmer was. Attention is often called to the interests of the universities or the language fight which forms a part of it, but the universities only occupy a few morgen of land, while the cultivation of 100 000 morgen is necessary to be able to establish such a university. If we admit that, it is the duty of everyone to see that those farmers should get their business capital on the same footing as any other section of the population. The price of money in the world is 3½ per cent., and the farmer must be enabled to get money at that price. My grievance is that it is put as if it were a favour that the farmers are receiving, and most of them do take it as a favour when they are now enabled to pay 3½ per cent. interest. But it is a stigma the farmers do not deserve. When the farmers get a basis of 3½ per cent. interest it is a thing they are entitled to, although the other 1½ per cent. which is added to complete the 5 per cent. is regarded as a subsidy to the farmers. I regard it as a bribe to those people who possess the money and who have always as yet held the farmers by the throat. They now get 1½ per cent. to release their hold. All hon. members will possibly not agree with me, but I am certain that they would not get 5 per cent. for that £120,000,000 if they had to invest it somewhere else to-day. But while those financiers are being assisted it is said that the farmer is getting relief to the extent of 1½ per cent. As I want to retain my self-respect I protest against such a statement. I wish the farmers to be able to borrow money on the same conditions as any other section of society, and even under better conditions. Those companies who attack the other scheme have issued a tremendous blue book. It is one of the things that they say in it [Time limit.]

On the motion of Mr. Nicholls, the debate was adjourned; to be resumed to-morrow.