I move—

Agreed to.

Bill read a second time; House to go into committee now.

House in Committee:

On Clause 3,

This is the clause in which we are asked to give effect to the request of the Minister of Finance to agree to the imposition of an excise on cigarette tobacco used for the making of cigarettes by hand. I do not propose to take up the time of the committee at all, but I must enter a protest against this method of dealing with the citizens of South Africa. I must reiterate what I previously said—that this tax is suggested merely with the object of helping to tighten up the monopoly that the big tobacco company has over tobacco sales in South Africa. It seems to me to be a particularly mean way of getting at the poor unfortunates who find it either desirable or cheaper to roll their own cigarettes. Since the remarks I made on this subject on a previous occasion I have had conversations with several people on the matter. They regard the proposal as an act of injustice, and they do not agree that it is advanced for purposes of revenue at all. In view of the remarkable financial position the country is in, the Government does not all of a sudden require the £20,000 revenue which it is estimated that this new excise will bring in. The object is punitive, and I enter my protest against it.

The object of this duty is to protect the cigarette manufacturer and the revenue from an evasion—I do not say it is an illegal or illegitimate evasion—of the cigarette duty. The present duty amounts to 2s. 6d. in the pound weight, whereas this tobacco used by people to make their own cigarettes will pay only three halfpence on every two ounces. There has been an increase in one year of over 80,000 pounds in the consumption of this cigarette tobacco in the form of hand-made cigarettes. There is a loss to the revenue which shows every sign of increasing unless something of this nature is done to stop it. I do not see why persons should be exempted from the duty, because they can make the cigarettes themselves. It is in the interests of the revenue and the industry that this duty should be imposed.

I hope the House will not accept the point of view put up by the Minister. I must again remind the House of the favourable financial position we are in to-day. I could understand the Minister asking the House to remove the tax on manufactured cigarettes, but he will not seriously argue that the country requires this £20,000. If, last year, the Minister had insisted that these people who make their own cigarettes should pay this tax on the tobacco in order that Government might balance the Budget, I could have understood it, but there is no excuse or reason for imposing this fresh burden from the financial point of view. The Minister admits that it is to protect the manufacturers. The revenue from the tax is not required, and the Minister has not said it is required, but only to prevent people evading the tax. Can the Minister justify the imposition of the tax? He cannot; so we have to get back to the first reason, and I think it is the governing reason, and that is, to protect the cigarette manufacturers. The Minister seems to think that people make their own cigarettes with a view to evade the payment of the tax, but I am assured by a very large number of persons that that is not the case. A great many people tell me that they find that manufactured cigarettes do not suit them because they affect their throats. When they make their own cigarettes they do not find that disability. Now the Minister is forcing those people, most of whom can ill afford to pay any more for their cigarettes, to buy manufactured cigarettes in order to enjoy their smoke. There is no ground for this particular tax. The revenue is not required, and I say it is an iniquitous thing to protect the manufacturer as against the people in this way.

The hon. member seems to have given up the argument with which he appealed to the committee originally. First he argued that this is an imposition on the poor man. Now he says it is a matter of taste.

The burden of my cry on the budget was that the Minister was protecting monopoly. I still advance that argument. I used the expression that “he saw a leak in the monopolistic wall, and stuck his thumb against it.” He is also penalizing those people who prefer to make their own cigarettes because manufactured cigarettes are inimical to their health.

Division called.

As fewer than ten members (viz., Messrs. Bouwer, Derbyshire, Madeley, Col. McArthur, Dr. H. Reitz, Messrs. Shaw and Sutton) voted against the clause, the Deputy-Chairman declared the clause agreed to.

On Clause 14,

I oppose this clause because of the absence of a definition making a distinction between pipe and cigarette tobacco in the matter of duty.

An amendment was made in the Dutch version which did not occur in the English.

Clause, as amended, put and agreed to.

Remaining clauses, schedules and titles having been agreed to,

House Resumed:

Bill reported with an amendment in the Dutch version.

Amendment considered and agreed to; and the Bill, as amended, adopted and read a third time.

I wish to move this resolution No. 7 in a slightly amended form. It will be found on page 63. This resolution was intended to provide for interest on farm mortgages in excess of 5 per cent. being taken by the State for the purpose of being restored to the debtor, but the point has been raised by the hon. member for Gardens (Mr. Coulter) that it might be clearer, with regard to the time when it will take effect. I therefore move, as an amendment—

As the motion is being moved by the Acting Minister of Finance I would suggest that the amendment be moved by another Minister.

T move—

I move, as an amendment—

The Minister this evening replied to the objection that only farm mortgages are affected under this provision and not other mortgages. I am not convinced by his reply because he was practically unable to indicate any reason as to why only farm mortgages should come under this Bill. I have received a large number of petitions from my constituency in connection with this matter, and for that reason I regard it as my duty to raise the subject again. I am very grateful for the concession that is made in respect of farm mortgages, but there undoubtedly are, in our small towns, people who find themselves in the same difficulty as the farmer, people who, as a result of the condition in which the farmer finds himself, have been landed in a state of affairs that they cannot pay their high rates of interest. For instance, I have the shopkeepers in mind, and other men of business in our small towns. I have in mind hotel keepers and professional men. But I particularly have in mind the other class of people whom I am pleading for, the poorer class, the workmen in the villages. Those people have bought plots of land and houses in order to have a home of their own. They have had bonds passed on their properties on which they very often have to pay high rates of interest and now they are also in difficulty.

The hon. member cannot raise this question now as the principle which is contained in it has already been approved of by the House.

Am I not allowed to move an amendment that the word “farm” shall be deleted?

No, I cannot allow that as the resolution of the House already includes the idea of a farm.

On a point of order, may not the hon. member, because it relates to farm bonds only, address himself to that point and object to the whole thing because of its partial operation?

I do not wish to raise objections to the whole Bill, but I merely wish to say that I deplore this measure as this kind of legislation creates a sense of friction between the villages and the rural areas, as the Minister will see from the petitions which I have submitted to him. People are gratified at the rural areas being assisted, we are all pleased about that, but the feeling is created that everything is clone for those people, while nothing is being done for the work-people, which is not equitable. Interest on farm mortgages is reduced, but not theirs. This creates a very unsatisfactory condition of which we are all scared, viz., the feeling of resentment on the part of people in the villages against the countryside. The people in the small towns do not ask for a subsidy, they are only asking for a reduction of interest. People get the impression that no provision is made for them and that they are simply to be thrown into the street because they are unable to pay their interest.

The hon. member cannot discuss this. He is discussing the principle in an indirect way.

I shall not discuss the matter any further, but in any case I have lodged my protest now.

I do not know exactly where I stand, but I hope you will tell me if I go too far. I merely wish to point out to the last speaker that I think that he is under a totally wrong impression when he imagines that an unfair line is drawn between the people on the countryside and people in the towns. I want to ask him whether he considers that mortgages in the towns should be placed on the same basis as mortgages on farms. Does he really think that the man who has a bond on a house, which he knows will only stand for about fifteen years, must be asked to come down with his rate of interest to 5 per cent. simply because the interest on farms has been reduced? There are no improvements to a house, while a farm can always be improved. What is the basis of the relief to the farmer? Is it not a fact that we all adopt a position that a farm and farming are peculiarly situated in our community, that one has to do in the first place with people whom we must try to keep in every possible way where they are? It is not necessary to keep a man in the same house where he is. It makes no difference whether he goes to live in house No. 2 or No. 3, but it is something entirely different to keep a farmer on his farm. We are not here to give doles. The false arguments in the remarks of the last speaker are the false arguments of the outcry which has been going on for some time, viz., that it is not merely the interest on bonds that must be reduced, but the interest on all debts. That is the greatest absurdity in all the world, and there is no man, whether he be farmer or professional man, who can concede that. A man like the hon. member for Ladybrand (Mr. Swart) should realize this. I wish to emphasize this: that if there is one thing that has struck me during the discussion in the House, it is that we are out to turn Parliament into nothing but a distributor of doles for the country. I hope that hon. members, instead of encouraging this impression, will discourage it. We all have our responsibilities here. It would be totally wrong to create expectations in the public mind which cannot possibly be complied with and which in the end can only lead to a state of affairs which we shall all deplore. It is only for this reason and for no other reason that I want to point this out to hon. members, but I consider that the time has come that we should act with more responsibility than to create such impressions among the public.

I have allowed the reply of the Prime Minister, but I cannot allow any further discussion.

I am glad the Prime Minister has realized the dangerous potentialities of proposals of this nature. Whether we agree with this particular proposal or whether we do not, I think every serious member of the House must realize that it is a very drastic step which the State is taking, which may only be justified, if at all, by the special circumstances of the case; but there can be no question that it is an unprecedented step for the State to take, as between creditor and debtor, to say that they, although having agreed upon, voluntarily and freely, a certain rate of interest, we shall see they do not get it. The State is proposing to step in when there are two bonds, one over farming property and the other over urban property and limit the interest to 5 per cent. on the farm property bond and say you may take 7 or 8 per cent. on the urban property bond. I say the Prime Minister must realize that, however well-intentioned such a measure may be, and however necessary it may be in the present state of the country, it is a very dangerous interference with economic laws, and I am frankly wondering whether it is going to be in the best interests of the farmers themselves. You see to what it leads. It is now urged that it be extended to urban bonds. It is not only in regard to bonds of an urban debtor, but there are thousands of properties which are bought on a hire-purchase system without any bonds at all, although the system is very much the same as that of a debtor to a bond. I regard this proposal with the greatest misgiving, and I am glad the Prime Minister has made it plain that this is a very special case and this resolution will not be extended under any circumstances beyond this special case, because if once the idea is allowed to creep in that it may be extended to the whole of the debtor policy of South Africa, that debtors have only to come to Parliament and ask it to relieve them of their promise to pay and pay only one-half of what they ought, what is to become of this Parliament? I am sure the acting Minister of Finance must feel this misgiving, too, in regard to this proposal.

I would like to support what the hon. member for Ladybrand (Mr. Swart) said. As far as interest is concerned, we have already interfered with economic laws. We have the Usury Act, which says that, in spite of what creditors and debtors have agreed to pay in the way of interest, you are not allowed to charge more than a certain rate of interest. If this proposal is an interference with economic laws, so is the Usury Act. The Government would be well advised, having regard to the cheapness of money, to take the view that more than 5 per cent. should not be charged all round, and they should have reduced interest all round to this amount. I rose for the purpose of asking the Minister if he could answer a question I have been asked by some people in the country who have a business in the country town as well as a farm outside, and their business is running at a loss owing to the condition of the farming industry. In his memorandum the Minister stated that all applicants for subsidies will have to state that farming is normally their sole or principal means of livelihood. What of bona fide farmers who are also interested in a business in the towns? I want to know whether if a farm that is mortgaged belongs to such a man who has a business in a town he can get relief.

It would depend. Farming mortgage, as defined in this, is a farming mortgage as defined in the Act, and the Bill will be read a first time when the Ways and Means Committee has reported.

I would like to draw the attention of the Minister to the way in which this falls most harshly on the person who is most in need of relief, the creditor who has given ample time to his mortgagee to meet his obligations, in the matter of interest, and I know of instances where a bondholder has for a year or more not called upon the debtor for payment, because he could not pay interest, that man will now be penalized under this section because he will receive his interest only at some time in the future.

No, may I explain? The resolution, as it stands now, would certainly have that effect, but by the amendment moved by the Minister of the Interior, that effect will be removed, because the words are inserted, “which accruing.

Amendment put and agreed to.

Motion, as amended, put and agreed to, namely—

Gold Mines Excess Profits Duty.

I move—

I make no apology for dealing again with the very important matter that we have been discussing on the motion to go into Committee of Ways and Means. The Minister of Finance, in introducing this tax in his budget speech, said that he reckoned on a deficit on the year’s estimates of £5,750,000, and with the deficit carried forward, he reckoned on an accumulated deficit of £7,686,000. That may have been a justification for the very heavy tax sought to be imposed by the Minister in this resolution on the mines for this year. They have taken £6,000,000 for this year, plus £1,400,000 income tax, bringing the total to £7,400,000, and there may be justification, therefore, for taking the whole of that amount this year. I do not personally think they are so justified, but I concede that in the existing state of the finances of the country there may be some justification for taking so large an amount. But consider what the position will be at the end of this year. Our budget ex hypothesi will be balanced, the deficit will have disappeared, our finances will be in order, and yet the Acting Minister in an effort to reassure the investing public and the mining houses has said that next year he or the Government will not take more than £7,400,000. I do not defend either the language or the spirit of the memorandum issued by the Chamber of Mines, but I do put this to the Minister of Finance. What he has done in effect is this. He tells the investing public, and the overseas investor that next year not more than £7,400,000 will be taken. I am perfectly certain from the spirit of the debate in this House, from what members from the country constituencies have said, that next year whether the money is needed or not needed, the Government will be compelled to go to the full limit of the £7,400,000. Yet we will have a balanced budget. We will not have these items that we have this year; for instance, the contributions to the maize pool of £526,000; we will not have the contribution of £120,000 to wipe off the deficit of the wheat pool, yet I am as certain as I stand here that the Minister will be unable to resist the pressure from farming members on both sides of this House to go to the full limit of the £7,400,000. Therefore, the Minister of Finance will forgive me if I say that in spite of the language used by some of my colleagues, including the hon. member for Turffontein (Mr. Sturrock) I regard this as a grave mistake, and that it will operate as an invitation to press the Government up to the limit. Of course, the Government will not go beyond that limit. We accept, without any reservations, the Government’s pledge on that point. I am perfectly certain whatever the personnel of the Government may be, even if changes occur and even if the present Prime Minister does not continue to be Prime Minister, and there is thus a technical change of Government, we can accept, in all good faith, the assurance that the Government will not go beyond that limit. I will go further, and say that no Government which succeeded this Government would dare to go beyond that limit. But I am afraid that the fixing of that limit, and at so high a figure—and with due respect to the Miniser I do say that it is a very high one—will inevitably mean that they must go up to the limit. If that is the case, I do really think that more harm than good has been done by these assurances of the Minister.

Would you like me to withdraw them?

I would much rather they had never been made, quite frankly. If the Minister had said, “We realize we have to take an exceptionally large sum this year because of the unbalanced budget and because of three years’ leeway to make up, but we give the promise that next year we will only take as much as is actually needed and we hope that will be much smaller than the amount taken now.” I believe that would have had a far more reassuring effect. I repeat, that knowing the. House as I do and knowing my farming friends as I do, I am perfectly certain that they will be sitting round the Treasury like a lot of hungry wolves demanding that the Treasury should take the whole of this money. For what? For what purpose would that be needed next year, with a balanced budget and none of these emergency payments to make? I will tell you. We cannot see the day when the export subsidy will be discontinued. As far as I can see that will continue indefinitely and the interest subsidy we are voting now will go on as far as I can see until the crack of doom, or at any rate, as long as the mining premium goes on. The worst feature of it is this—that all incentive to economy in public expenditure will disappear. As long as they know they have £7,400,000 of unearned money to draw upon, it will be impossible for any Minister of Finance to impose any sort of brake on the spending capacity and demands of departments and private members. The Minister thinks I am a sort of modern Cassandra but I do believe that a grave mistake has been made in fixing that amount, although it was done with the best intentions. I want to say a word to my genial friend the Minister of the Interior. I make him a present of the fact that the other night I was not too sure of my figures. What I was sure of was the £6,000,000 and the £1,400,000, but, as to what percentage that would be, I had not completely grasped all the implications of the Minister’s statement. That I make him a present of, but I now know the position. Then he twitted me that I had lapsed from financial orthodoxy, that I had become a backslider, because I suggested it was bad policy to try to balance this year’s budget with a deficit running back for three years in one fell swoop. The Minister suggested that was quite at variance with my previous utterances on this point, but if the Minister would do me the favour of looking at my budget speech last year—

I know you started backsliding then.

The Minister suggested that this was a new form of backsliding. Last year I said that for the Minister of Finance to impose £3,500,000 new taxation in an effort to balance the budget on the gold standard, was to embark on an impossible course, and that it would be much better to carry forward a certain amount of the deficit and impose reasonable taxation. I want to say this to the Minister of Finance, and this is my last word. I do believe that whether you have a moral right to take that £6,000,000 or not, from the point of view of expediency the country and the farmers would have been bettet off if, instead of trying to overtake the three years’ deficit in one year, you had been content to take £4,000,000 or £5,000,000 instead of £6,000,000, leaving a gap of £1,000,000 or £2,000,000 with the knowledge that the money would be there next year, and more than enough. If you had taken £4,000,000 this year, and said, “We will take another £4,000,000 next year,” with the knowledge that that would have more than balanced the budget, I do believe that in the long run the resultant prosperity to this country, the further opening up of the mining industry, and the greater confidence that would have been inspired in investors, would have been far better from a business point of view and from the point of view of business government, than, shall I say, this ultra financial orthodoxy which compels the Treasury to take the whole of this amount in an effort to overtake three years’ deficit. It was not as if this country were in an unsound financial position, as if the deficit had been running on for years, and there was no prospect of overtaking it, like some other countries. The money was there, and we know it will be there next year. I merely say it would have been a judicious and wise thing in my opinion for the Treasury and the Minister to have said, “Very well, we are prepared to balance most of our budget, we are prepared to wipe out three-quarters or five-sixths of our deficit, but if in an effort to meet the whole of our deficit we are imposing an undue burden on any section of the taxpayers, and we are likely in any way to jeopardize confidence in the mining industry, we will rather carry on with a portion of the deficit for another twelve months, well knowing that the money will be there at that time.” My criticism of this particular taxation proposal is that although it may be orthodox, although it may subscribe to copybook finance, from a business point of view it would have been far wiser to have limited this bite to £4,000,000 this year, and, if necessary, take another £4,000,000 next year. I see grave potentialities of danger for the future, in the knowledge held out to this House and to South Africa and the world that next year there will be £7,400,000 to play with, and no budget to balance.

I feel it my duty to say a few words on the question of this gold mining taxation. I wish at the outset to express a special word of thanks to the acting Minister of Finance. I think that very few people realize to the full the difficult task which he has had and his constant devotion to duty in trying to do the best in this great welter of apparently conflicting interests not only for one section, but for the country as a whole. And I think he has done that not altogether without success. I think the adjustments which have been made and the assurances given on behalf of the Government to the mining industry, should enable that industry to undertake considerable development and expansion. I must say that I am surprised at the attempt of the hon. member for Kensington (Mr. Blackwell) to defend the statement of the Chamber of Mines that by giving these assurances for the future the Government are doing something which have an effect very much to the contrary of what was intended. I think the hon. member rather gave that impression by the interjections which he made when the Minister was making his statement. With regard to these assurances for the future, I prefer to accept the considered opinion of the hon. member for Springs (Sir Robert Kotze), rather than the views of the hon. member for Kensington. I was glad to hear that, in his opinion, these assurances should be regarded by the mining industry with some measure of satisfaction. I have been moved in this matter by the fact, that, for the first time in the history of the Rand and of the gold mines, the employers and employees, and even the unemployed, have all stood together with a great deal of unanimity in their protest to the Government. I was surprised to hear the hon. member for Moorreesburg (Mr. Erasmus) talk in the way he did and take up the attitude which he did, and state that we from the Rand represent the mining bosses. Nothing can be further from the truth than that. I am concerned entirely with the interests of the working people of the Rand, with the interests of the thousands of people who derive, not wealth from the mining industry, but derive their very livelihood from it. We have had petitions from these people, I have had a petition signed by scores of unemployed asking that the Government should give the mining industry an opportunity of extending to such an extent that these people will be able to be absorbed in employment. I feel that, after the statement issued by the Chamber of Mines, and after the way in which the Minister dealt with it, the Chamber of Mines are running the risk of destroying that unanimity which has existed so far. I do wish, however, that the Minister would assure us that in his opinion, on the figures by which he is guided, and which are given to him by his expert advisers, if the mines use the opportunities which they have under the present taxation, there will be that scope for employment of more people on the Rand in the mining industry. That is what we from the Rand are chiefly concerned about. In my own constituency, there are no working mines of any consequence now, but we have in that constituency some £5,000,000 invested in industries, and all these industrial undertakings are directly or indirectly dependent on the mining industry, and those industries employ very largely white labour, and if the mining industry goes ahead, those industries will thrive and absorb many more white people, and I do hope that the Minister will be able to give us an assurance on that point.

I have been trying to achieve certain points in regard to the taxation which the Minister proposes to levy on the gold mining industry. Well, the Government, for reasons which appear adequate to them, have decided to adhere to their original ideas and are going to adhere to taxing the industry to an amount not exceeding £6,000,000, and to distribute the burden in what I consider an unfair manner. I deplore that decision, but at the same time I accept it. There is, however, a further point on which I would like to speak, and that is the point in regard to the encouragement of the mining of low-grade ore. I indicated to the House a few days ago that the new scale does not completely achieve this, and that a very large tonnage of low-grade ore near the pay limit would be lost and would not be worked under this scheme, but would be lost to the country. It would amount to a very considerable tonnage, tens, if not hundreds, of millions of tons, and it would curtail the life of the industry. Therefore, I am still anxious to devise a modification of the scale which would obviate this difficulty, and on thinking the matter over further, a new idea occurred to me yesterday for modifying this scale, and I have indicated that to the technical advisers of the Government, and I have asked them to examine it. The time has been too short thoroughly to examine it, but I am assured that the object which I desired to achieve would be attained, but that it would also have the effect of the yield from this tax being too small, if the percentage of seventy, in the motion now before the House, were retained. That would be obviated by raising the percentage. My contention is that the total levy would be unchanged and that the distribution among the various mines would be only slightly affected. I would leave the Government’s total share unaffected, but I would effect this further purpose by my new scheme of securing the complete mining of low-grade ore down to the pay limit. Under the rules of the House, I cannot move that the 70 per cent. be raised to 80 per cent., although it would not affect the yield. Of course, I can also see the Government’s difficulty in this respect, but I would like the Minister to indicate to us whether he can do anything in the matter. Personally, I think that if it could be done while we are dealing with the matter, it would be much better, because we would improve the tax and make it much more satisfactory. It is one of the results of hurrying through with a measure like this that we are unable to devise ways and means for doing it satisfactorily with the time at our disposal. If we only had a few more days, we could have fixed this matter up satisfactorily. I seriously ask the Minister to take this into consideration. I am only indicating a point which the Government itself is extremely anxious to obtain, and this is one of the ways in which low-grade mining could be encouraged.

I am indebted to the hon. member for Springs (Sir Robert Kotzé) for making this suggestion, and I would like to say again that I appreciate the attention which he has given to this matter and the manner in which he has tried clearly to criticize our proposals, and I hope that after the House rises when we are having an enquiry into any possible modification of this scheme, we shall be able to have his assistance. But I am sorry that I do not feel able to move in the direction indicated by him. The matter was gone into by my department and I am advised that if the proposals before the committee were amended in the direction he desires, in the first place, the upper limit of the scale would have to be raised from 70 per cent. to 80 per cent. or more. To do that at this moment would have a bad effect. It would be extremely difficult to get people to understand why we are again going back to the 80 per cent. figure or even higher. The hon. member says that the total amount to be raised would not be exceeded. That is true. In the short time that has been available to calculate the effect of the suggestion, we estimated that it would involve a drop in the produce of the tax of £750,000. So that the further substantial raising of the upper limit would mean that it would not be possible to get the amount of revenue that is desired. Another result is this, that although it may have the effect of encouraging the mining of low-grade ore, the result would be as regards individual mines, that the poorer mines would not pay less and some of the richer mines would pay considerably less. I am given some examples here of the effect of this change on the richer mines. On the Crown Mines, for instance, there would be a drop of £120,000; on the New Modder a drop of £150,000, whereas the poorer mines—

Would not that be because they would be mining a lot of lower grade ore?

That is what the effect would be by raising the rate on the richer mines. Whether it would be because of their mining lower grade ore or not, that is the effect, as between richer mines and poorer mines. That being so, I am not able to accept this amendment at the present time. I think that the raising of the upper limit to the extent indicated would have an unsettling effect and would not be in the interest of the industry or of anybody else. The present resolution, I am advised, does encourage generally the mining of low-grade ore. In certain particular mines, it may not have that effect, but generally that is the effect, and I am sorry I cannot accept his suggestion, but it will be further enquired into and I hope that we shall have the assistance of the hon. member during the recess in trying to arrive at a more equitable method. The hon. member for Germiston (My. Strauss) asked if I could give a definite assurance that; when this tax came into operation, it would not stop the increased employment offered by the mines. I am not able to give that assurance, because the matter is not in my hands. On the best advice which I can get, I am of opinion, and the Government is of opinion, that the levying of this tax should not have the effect of restricting development and expansion, and should not put any obstacle in the way of increased employment; but I cannot say what effect it may have on the minds i of those who are responsible for the management of the industry. That is a matter which remains to be seen, but what we say is that we do not think that the amount which we are taking is an unreasonable amount. It is not an amount which should stop expansion or curtail employment. The hon. member for Kensington (Mr. Blackwell) argued, somewhat strangely I thought, that the effect of fixing a limit—

No higher limit, I should have said.

—as the probable limit of what we would take in the form of this taxation in future years, would have a worse effect than if we had fixed no limit at all. He tells us that greedy applicants will insist on the Treasury taking the whole of the gold premium. I suggest that, if that is the case, the Treasury will still be besieged, and if no limit is placed by the Government on what it intends to take, the demands of the applicants will also be limitless. If the Government is forced into additional expenditure, I cannot see that the fixing of a limit is likely to moderate these demands on the public purse.

Applicants will push you to the limit.

The hon. member’s contention comes to this—that persons contemplating investing in gold mines will be less reassured by our fixing these limits than if we fix no limit at all. That proposition does not commend itself to my ordinary judgment, and I hope it will not commend itself to the judgment of the House.

I hope the Minister will issue a fresh white paper on this subject. The present one is most difficult even for mining experts to understand, and it is still more difficult for ordinary members of this House to comprehend. I call attention to this remarkable fact: that every statement of the Minister, and every modification and every concession, intended to put this tax on a better footing, has been met with the declaration by those interested in the mining industry that the position is no better than it was before. This may be due to the fact that there is a good deal of obscurity as to what the effect of the Government’s complicated proposals will be. I believe that what have scared off the investor are the doubt and uncertainty that exist to-day, as to the effect the Government’s proposals will have. The Minister has told us what the intentions of the Government are, and we all agree that he is conscientiously doing his best to give effect to those intentions—that he wants to see the life of the mines prolonged by the working—on a larger scale—of low-grade ore. Unfortunately, so far, he has not been able to convince the industry that that will be the result of the Government’s proposals. I do not know who is right or who is wrong.

None is so deaf as those who will not hear.

Unfortunately, the industry remains unconvinced, and I ask the Minister, during the recess, to take a wider view of the matter. This country is dependent, to a large extent, on world conditions. There is a conference now sitting in London, trying to deal with matters of currency, trade and commerce that affect us all. One of the reasons for the present disastrous state of the world is a shortage of gold, on which currencies are based, the annual supply of which does not comply with the demands created by the expansion of trade and commerce. I understand that, during the last ten years, trade and commerce increased at the rate of 2 per cent. per annum. That means that the currency necessary for the carrying on of trade and commerce should also expand in the same ratio. But the annual world production of gold is decreasing at the moment. Therefore, one of the most effective ways to help restore trade and commerce to a healthy state is the production of a larger amount of ounces of gold. I can visualize that the effect on prosperity will be as great in the future as in the past if the annual production of gold is increased. The Minister knows the profound effect which was caused last century by the discovery of gold in Australia and California, and later on by the opening up of the Witwatersrand. If the world’s gold production could be increased by 25 per cent., together with a prospect of maintaining that increase, that would have a great effect on the expansion of trade and industry and commerce of the world. If the Government can see its way, by any reasonable means, to induce an increased gold production, that will have a most beneficial effect, not only on South Africa’s prosperity, but on that of the world in general. Any means by which investors can be induced to supply the necessary funds for the immediate development of our gold-mining industry is to be encouraged. I hope the Minister will be able to reassure the investing world that the mining taxation this year is altogether exceptional, as far as the Government can foresee. The Minister has gone so far as to say that the taxation will not be increased, and he gave a forecast that the exceptional demands to be met by the Government this year are not likely to be encountered next year. I agree that the Minister has made a good start in saying that taxation will not be increased, but he might say that, so far as he can reasonably forecast the expenditure of the Government, that it will not be such as to demand a heavy tax on the gold mines in future years. A statement like that coming from the Minister, whose statements carry great weight, will have a reassuring effect, and tend, perhaps, to mitigate some of the rather disastrous results that characterize the present position. I cannot distribute praise or blame, but capital has been scared off, and investors have been discouraged. I think the Government might take the larger view, and do all in its power to encourage a bigger production of gold, whereas it is admitted that this year the output will be slightly less.

One fact is clear with regard to the effect of the Minister’s modified taxing proposals, and that is that the announcement by the Minister of Finance of his modifications and so-called concessions, has been met by a continued decline in the share market, because these so-called concessions are not regarded as concessions by the investing public. These concessions are not regarded as concessions for this reason. If a highwayman meets me on a lonely road, and puts a pistol to my head, and says, “Your money or your life,” and then a moment later says, “I will only take half your money; and if I meet you again in the same spot on this lonely road 12 months hence, I will then take only half your money,” I suppose I should have reason to be thankful to the highwayman for not taking all my money. I suppose the investing public has the same reason for gratitude to the Minister. I will tell you why the Minister’s concession has not had a reassuring effect. It was believed, rightly or wrongly, that this year’s demand was a special demand to meet a special emergency. People knew that the Government badly needed money, and they believed that though the Government might have a specially big demand this year, in order to balance their budget, that demand would not occur next year. Now that a figure has unfortunately been mentioned, the investing public believe that my colleagues in the coalition, the political supporters of the hon. the Minister of Finance and the Prime Minister, will see to it that the whole of that amount is taken next year, and for the three years following. From now on, any careful investor will work out his calculations on the basis that the Government will go the limit, and take that amount. So far from being reassured, the public have wakened up and found that the position is much worse than they hoped it would be. They had hoped that while a big slice of the profits would be taken this year, a smaller slice would be taken next year. Knowing my hon. friends in this House, and listening to their speeches—I have listened to the speech of the hon. member for Moorreesburg (Mr. Erasmus), and, knowing whose mouthpiece he is in this House, I know that the Government will be compelled in its own defence to go up to the limit next year of those figures that have been mentioned. That is why I am afraid that I do not agree that those concessions are really concessions, or that they carry any reassurance to the investing public.

I should like to avail myself of the opportunity to express my thanks to the acting Minister of Finance for the courageous way in which he has stood by the attitude which he has adopted. There was a consensus of opinion among members that the Government had capitulated to the Chamber of Mines, but after we had heard the Minister’s speech and also the courageous speech of the Minister of the Interior, after we had heard the manner in which they defended the Government and the taxation proposals, we can only express our thanks to the Government for having stood by its policy. I am one of those who was of opinion that the Government could have taken a little more because those premium profits do not belong to the mines. I am strengthened in that conviction by what I read in the report of the Select Committee on the Gold Standard. I shall quote that to the House.

We have read it.

It may do you some good to read it again. In paragraph 112 on page 50 it was stated that those profits come out of the pockets of the rest of the community. Those profits are received by the mines because their product is gold, while their wages and their expenditure in regard to supplies are paid in paper money. In the Parliamentary library there is a book named, “The Tragedy of the Pound,” which I wish to commend all members to read.

I must ask the hon. member to confine himself to the motion.

I only wish to say that we can talk here of the tragedy of the gold standard. Then I wish to make some comment on what the hon. member for Roodepoort (Col. Stallard) has said, viz., that the farmer has received as much benefit from our departure from the gold standard as the mines. That may be so with the wool farmers, but he forgets that the medium by which the farmer pays has depreciated by 30 per cent.

The hon. member cannot discuss that now, that was done during the debate.

In any case I am pleased that you have given me the opportunity to express my thanks to the Minister of Mines and the Minister of the Interior for the attitude they have adopted.

I want to say a few words with regard to the speech of the hon. member for East London (North) (Brig.-Gen. Byron), and especially with regard to what he calls the wider point of view, a point of view which naturally interests everyone who is concerned with economic conditions in this country and outside this country. I have no doubt that if the international basis of currency is to remain gold, the quantity of gold available will have to be increased by every possible means. That may certainly bring about an altered outlook in this country with regard to what we call the premium on gold, but I cannot give the undertaking he asks for, which is to tell the world that the amount we are taking during this financial year will not be required in future. That is going further than I am justified in going, but the hon. member can be assured that that outlook with regard to the supply of gold in the world is one that must occupy the attention of the Government. With regard to a statement explaining the effect of the present resolution, I will see if something of that sort can be done.

Motion put and agreed to.

Resolutions to be reported with an amendment.

House Resumed:

The DEPUTY-CHAIRMAN reported that the committee had agreed to certain resolutions on gold mines excess profits duty and farm mortgages interest tax with an amendment.

Report considered and agreed to.

Amendment put and agreed to, and the resolutions, as amended, adopted, and a committee appointed to bring up the necessary Bill or Bills.

When will this Bill and the other Bill be available? We would like to get them for the week-end if possible.

I will see that hon. members have time to consider them. This is a very difficult and important matter, and I will not go on with the second reading before hon. members have had time to consider it.

With regard to the insertion of the word “unlawful” I can find no definition in any of the Gambling Acts what is unlawful gambling.

There is no definition of “gambling” either That is why we must put in that word.

If some act is a crime, surely there should be some definition of it. What is the need of using the word “unlawful”? No gambling is lawful; but under certain circumstances a prosecution shall not ensue as a result of gambling where it happens to be permitted; and hence there could be no conviction, but still that does not make gambling lawful, thus I see no reason for the insertion of the word “unlawful”.

The hon. member is not right. The difficulty is this—surely the hon. member does not want to penalize a game of bridge with a small amount on the game. You must put in the word “unlawful”. It would have been better if the Minister had introduced a consolidating Bill, because the law on gambling is most chaotic. Each province lias different Acts. It is the evident intention of the drafter of this Bill to penalize only unlawful gambling. I think the amendment is necessary.

Amendment put and agreed to.

New clause to follow Clause 1,

I have an amendment for a new clause to follow Clause 1. I regret the Minister did not accept this because surely the Minister can see that it does not leave any loophole for any night club. There is nothing behind this amendment, it will merely set at rest certain doubts that this law may be interpreted as interfering with what is allowed at present. It was suggested when I first moved my amendment that it might enable one of these night clubs to get behind the law. I do not see how it can possibly do that because if a night club were to acquire a licensed house that would be met by my amendment. It would still be doing an unlawful thing for which it could be closed down and punished. As for horse-racing and so on, betting at the present time is very much restricted. It is only allowed under special circumstances under the existing law at certain clubs like Tattersalls and at a race-course on the day of the race. It is not allowed on the streets and my amendment will not make it lawful. It is simply to make it clear that the law will not extend to anything more than the object intended by this particular statute. It is much better to set these doubts at rest than to leave it to the courts to interpret what you mean or do not mean. My amendment cannot in any way allow anyone to get behind the intention of the Minister as expressed in Clause 1. I move, therefore—

I am sorry I cannot accept the amendment. I do not question the hon. member’s good intentions, but there may be several “niggers in the wood pile.” As a Johannesburg legal practitioner myself, I know that our collective ingenuity for finding flaws in Bills is positively superb, and for that reason I am afraid of this amendment. I can conceive of a night club staging a bogus boxing match every night under this Bill. They might start a wrestling club, and run a night club behind it.

The existing law will deal with that.

No. I am not sure of that, and I regret I cannot accept this amendment. The hon. member knows my view on this subject, and that his fears are purely academic. There is no danger that this will affect ordinary clubs, racecourses, or anything of that sort.

Proposed new clause put and negatived and the Bill, as amended, adopted.

On the motion that the Bill be now read a third time,

I do not want to prevent the Bill going through to-day, but I am surprised that the Minister should introduce the native question into it by referring to “niggers in the wood pile.” I rise to make a sporting offer to him. I will be prepared to cease making any further suggestions of this kind if he will submit my amendment to the law advisers of the Crown, and if they will tell him that the object of this Bill will be affected by my amendment I shall be prepared to say I was wrong. But do not take up an obstinate attitude. If the law advisers should agree that my amendment would settle certain doubts that will arise in the interpretation of the law, I hope that in an equally sporting manner he will also admit fie was wrong.

To come back to my point, will it not be necessary to amend the title of the Bill which is called a Bill to amend the law in regard to unlawful games and gambling, whereas in the provisions of the Bill itself which deals with unlawful gambling without containing any definition as to what constitutes unlawful gambling. The title of the Bill is thus different from the provisions of the Bill.

Motion put and agreed to.

Bill read a third time.

On a point of order. Last night when we were on Vote 33, the hon. member for Pretoria (East) (Mr. Giovanetti) was speaking and a conversation took place between him and the Minister which nobody else in the House could hear. The hon. member for Pretoria (East) remained on his feet and did not sit down, and you then put the vote and declared it carried. I protest that it was done somewhat hurriedly by the chair, but I particularly take umbrage at the fact that the Minister and a member by private arrangement agreed to take what the member wanted to speak about on the next vote. The rest of the House is, therefore, now unable to take any part in the discussion. We do not want to hang up matters, we want to get the business through, but I say that it was done in a manner which was not audible to the House. I put the matter to Mr. Speaker, who told me, however, that I should raise it when you were in the chair. In all fairness to the House, the vote should not be taken as having been passed, and I move that Vote 33 be reconsidered.

The vote has been passed.

I should like to know whether the House can give this committee the right to reconsider it.

The House has got that right, but not the committee.

How could we put this in order? It has happened once or twice before that there has been some misunderstanding, and we have been able to go back and repair the error. Is it not in your power to do this? Can I move that we should report progress and ask leave to sit again and then get Mr. Speaker’s leave to put this right?

The leave of the House can of course be asked.

Cannot we do it by unanimous decision of the committee? I move that we report progress in order to get leave from the House to discuss this vote. There are a number of important matters to be discussed.

If the motion is carried, and progress i is reported, does it not mean that we are unable to proceed with these estimates today?

Mistakes of this kind have occurred before. I don’t say deliberately, and we have been enabled to put them right.

If progress is reported, the House can give permission for the committee to revert to the vote and resume in committee forthwith.

On previous occasions when the chairman has passed a vote under a misapprehension, he himself has given the committee permission to revert to the vote.

Generally speaking, when there appears to have been clearly a misunderstanding and attention is at once directed to it, the chairman has again put a vote, but after the lapse of a day, as in the present case, the committee can only revert by permission of the House.

I raised the question when the hon. member for Pretoria (East) (Mr. Giovanetti) was still standing, and the question was raised later on.

I think it would be better to take a vote on the matter. I move—

I suggest that the chairman report that the vote was passed under a misapprehension. I take it that the House is quite entitled to allow us to revert to a vote if it has been passed in error.

Naturally, I do not wish to delay proceedings, but in my mind there was a misunderstanding last evening. I think hon. members were under the impression that the question the chairman put was that we should report progress.

Hon. members can put their points to Mr. Speaker, but the question was quite clearly put twice—in English and Afrikaans, and I waited for a few seconds, as I expected someone to rise and speak.

I should be the last person to want to burke discussion, but I am sorry that the hon. member for Albany (Mr. Struben) has suggested—unwittingly—that there was some arrangement between the hon. member for Pretoria (East) (Mr. Giovanetti) and myself. I say unwittingly, but the words the hon. member for Albany used bore that interpretation. I hope the hon. member for Kensington (Mr. Blackwell) will not press his motion now, as there are certain other votes we can proceed with. There is no harm in taking the vote for the Interior after the Public Service Commission vote.

Will you support that?

Yes.

On the other votes we cannot discuss policy at all.

Motion put and agreed to.

House Resumed:

The DEPUTY-CHAIRMAN stated that he had been ordered to report progress in order that the committee might obtain leave of the House to revert to Vote 33, “Interior,” and ask leave to sit again.

Last night the hon. member for Pretoria (East) (Mr. Giovanetti) rose in his place and addressed the House. The point he wished to raise referred to the next vote to be dealt with, which was the public service Commission. Remarks passed between him and the Minister in charge of the vote, which the rest of the House did not hear, upon which, the hon. member still standing in his place, the Chairman put the vote and declared it passed. I admit that there was some confusion and misunderstanding, and the general impression in the House was that the question being put was that we should report progress. I submit that the vote was passed under a complete misapprehension, and I move, as an unopposed motion—

Mr. BLACKWELL seconded.

Agreed to.

House in Committee:

The DEPUTY-CHAIRMAN stated that the committee had leave to revert to Vote 33, “Interior.”

On Vote 33, “Interior,” £267,728,

I want to draw the attention of the Minister to the occurrences on election day in Kensington. You will be horrified if I tell you—

You were elected.

You will be horrified if I tell you that 500 people in Kensington, most of whom wanted to take part in the election, were turned away from the polling booth, and there is very much indignation among the good people of Johannesburg with regard to the arrangements there on polling day. I will tell you what happened on election day in that suburb. From about six o’clock that evening, there was an enormous queue outside the polling booth, and from seven or quarter-past seven that evening, anybody who came had to stand at the back of the queue of from 400 to 500 people, with the result that when the polling booth was closed at eight o’clock at least four hundred, possibly five hundred people—voters— were turned away. Now I am raising this point in the first place to get a declaration from the Minister, what the practice of his department is. The hon. member for Germiston (Mr. Strauss) is here. He is a voter in Kensington, and he turned up at twenty-five minutes to eight that night with his wife. They managed to get into the polling booth by a round-about way. We interviewed the polling officer and asked him what he was going to do at eight o’clock, as there was a huge crowd outside. He said that his instructions left him no option at all, and he must close the doors at 8 o’clock. He would let in the fifteen to twenty people in the porch, but not let in the remainder. The hon. member for Germiston said those were not the instructions of the returning officer in his by-election of a few months earlier. The instruction of that officer was to open the door and admit everybody standing outside, and then close the door. The hon. member behind me put that to him, but the officer said those were not his instructions, and that that was not his practice. I raise this in order that the department may leave no doubt in the minds of returning officers as to what they may or may not do when there is a crowd outside the door of a polling booth at 8 o’clock. Are they all to be admitted and then the door closed, as has been done in Bezuidenhout and Malvern, or is everybody waiting outside to be shut out? The voters in Kensington are very annoyed about this. It is not as if they had turned up at the last moment. Some came about 7 o’clock and could not get in by 8 o’clock. They blamed the arrangement inside the booth. The staff was not adequate to pass voters through. Of course they must blame themselves to a certain extent. They have no right to leave it even as late as 7 o’clock. From a candidate’s point of view, if a voter could vote earlier, and yet leaves it so late, he is committing an offence. At the same time, for a polling district with 4,000 voters, there were only six officers to pass these voters through. In other words, three lots of two, in addition to the actual polling officer. So 4,000 voters had to pass through the polling booth with six actual polling officers. These six were divided into three couples—one to look up the names, and the other to issue the ballot papers. We found that once a big crowd had commenced to collect, that was entirely inadequate. I complained to the returning officer, and he said, “I am sorry, but I have the maximum staff that the regulations allow.” Four thousand voters is a very large number to pass through one polling station. It is larger than the whole of the constituency used to be before women were enfranchised. I would ask the Minister to look into that, and to see that, in these large urban constituencies, there is adequate accommodation. There is nothing more exasperating to a would-be voter than to find that he has to wait in a queue for an hour and then be turned away without being able to record his vote. I do not think I am exaggerating when I say that the number turned out was at least 500.

I am glad the hon. member for Kensington (Mr. Blackwell) has had the opportunity of raising this matter, because if given publicity to-day it may assist candidates in inducing voters to be a little more punctilious in future in voting early. The hon. member has asked me to state what is the policy of the department in regard to this matter. That has been definitely laid down in the regulations, and the regulation on this point is perfectly clear. It is, that the doors should be closed at 8 p.m. precisely, and no person shall be admitted after that hour, but the presiding officer shall permit every voter, who is at that time in the room, to record his or her vote before closing the poll. I think that regulation is satisfactory. The hon. member has further asked that I should investigate what happened at Kensington. I had sufficient knowledge of the hon. member to make that investigation in advance. As soon as the report appeared in the press, I obtained a report from the returning officer. I think I should draw the hon. member’s attention to the fact that, under the law it is the returning officer who is responsible for providing ballot boxes, etc., and for appointing presiding officers and polling officers. That responsibility lies with him, and it is usual for candidates, in advance, to discuss his arrangements with the returning officer. He is not limited as to the number of staff.

He told me he was.

The report from the returning officer is to this effect, and it is not quite in accord with what the hon. member has stated. This is the report—

I recognize, of course, that it is not always easy to judge numbers, especially in the dark, and therefore there is some justification for the variation of opinion as to the number of people who were excluded. At any rate, I have done all I could, as far as I am concerned, and so has the department.

You have not told me what they were to do with the queue outside.

The paragraph lays down that all those inside are allowed to vote. If there are too many waiting to get inside, that is unfortunate. I have here the report of the returning officer that all the people inside were allowed to vote. It is unfortunate that people did not vote earlier. That is an unfortunate accident for which I do not think anyone can be blamed. In the ordinary course of events, the provision made here is adequate. If voting had proceeded as is the case normally, there would have been no difficulty, and the provision would have been adequate. At any rate, the candidates did not raise any objection beforehand in regard to the adequacy of the arrangements, and while one regrets that certain people were prevented from recording their votes, we have to regard it as an unfortunate incident and leave it at that.

I think it would be unfortunate if the Minister were to depart from the rule that the door must be closed at 8 o’clock, because we know that at the end of the time there are always large crowds of people outside, the majority of whom are not voters at all. I do not think the Minister should consider changing the rule, even if he had time to do so.

On the motion of Maj. van Zyl, it was agreed to report progress and ask leave to sit again.

House Resumed:

Progress reported; to resume in committee on 19th June.