I would like some explanation about the staff control committee, which I am told exercises a tremendous influence on the railways. I am given to understand that it has such powers that it almost amounts now to the centre of a spying service throughout the whole of the staff of the South African Railways. If my information is correct, that is a very serious state of affairs. I am told that this staff control committee more or less supersedes the powers of the general manager. The railways have a general manager, and he has system managers, and I think the Acting Minister of Railways, being a business man, will understand that these men should have complete executive powers, and that if their functions are going to be interfered with by a staff control committee or any board, their services as managers will be nullified. I was told by two officials that they were quite prepared to leave the service, so bad has the state of affairs become. I think this is the right place to raise this matter. I raise the question, in order that the superseding of the functions of officials by this board or committee may receive attention.

On three occasions lately we have had an Acting Minister in charge of this Vote. This is inconvenient and unsatisfactory when questions of policy arise. I find that many men on the railway are now required to retire at the age of 50. The explanation is that this is necessary for the purpose of reorganization, but to require a man to retire at the age of 50 is requiring him to retire at an age when he has to undergo the heaviest expenditure in regard to the education of his family and in other ways. There are many cases where men have offered to retire, in place of those called upon so to retire, and the department would not agree. I understand that the position is that if men retire before the proper age the pension is paid out of revenue, and not out of the pension fund, which is inconvenient for the department. That, however, is no reason why these men should be made to suffer. I should be glad if the Minister would reconsider the position. With regard to railway expenditure, I think that the expenditure of £31¼ millions as the peak is far too high for a country with so small a population. We are now back at the 1925 figure, a year when the prosperity of the railway was great. The prosperity of the railway was not due to greatly increased income; but to the limiting of expenditure. It seems to me that the railways have saved in two directions, and that one of them is very detrimental to the men in the service, the saving being effected at the expense of the staff. During the last two years, the expenditure has decreased by £5,000,000. Of that sum £1,992,150 has been saved by changes in personnel and staff reductions, a sum of £190,158 has been saved by modifications of staff, and the 5 per cent. cut accounts for a saving of £500,000. In regard to the staff, there has, to put the matter briefly, been a saving of £2,750,000. In other words, £2,750,000 of savings out of £5,000,000 has been borne by the staff. More than half the whole of the saving was due to cuts suffered by the staff. Besides this, and in spite of the very serious unemployment in the country, we find that the reduction in the number of the staff in 1932 ’33 was 8,634, and that this, with the reduction in the previous year of 8,593, makes a total reduction in two years of 17,227. The Auditor-General tells us that in the years 1930 to 1932 the reduction was 14,000. In short, while we have had so much nnemployment in this country the staff has been reduced, during the last three years, by 22,634. The staff engaged on open lines fell from 93,212 in March, 1930, to 80,464 in March, 1932, a decrease from 6.9 per cent. to 5.8 per cent. per open mile. During the same period the pay of all grades dropped from £16,000,000 to £13,500,000. The officers in the service did not suffer to the same extent. They suffered by a drop from £3,500,000 to £3,250,000, but the employees suffered a drop from £12,500,000 to £10,000,000. One is glad to see the increase made this year, though slight, in the provision for the maintenance of the permanent way and works. That increase is overdue, but, while we are glad to have that increase, I am very sorry to see the provision made for depreciation. In 1931’32 the provision was £1,900,000, and this dropped in 1932-’33 to £1,600,000, a decrease of £300,000. This drop in the provision for depreciation was arranged on a very arbitrary basis; for example, in 1931-’32 it was based on 60 per cent. of the sum arrived at by applying various percentages according to each class of asset. In 1932-’33 the amount represents the maximum percentage of not more than 7½ per cent. of all the revenue of the railway service. That is most arbitrary. A round figure is taken, and it is merely a percentage of something which does not really affect the case. This, I think, is all the more objectionable when we remember that maintenance and repairs were reduced considerably. In 1931 the expenditure on this service was £2,557,664, and in 1931-’32 it amounted to £2,390,710, a decrease of £157,954, equal to a reduction of £8 per single track open mile. The estimate of the expenditure of 1932-’33 on the same basis, shows a further reduction of £120,000. On rolling stock, on the same basis, the decreased expenditure is £495,523, and this, added to a fall of £590,966 in 1931-’32, shows a dangerous decrease. I think no one will deny that our rolling stock requires very serious attention. We find that right throughout the whole country people are complaining about the condition of the rolling stock, and at the same time we find that the staff has been greatly reduced, and that unemployment is increasing. I would suggest that instead of reducing the staff to the extent we are doing at present, we should try to employ some of them on getting our rolling stock into fair condition. We have large numbers of technical men, and we should employ some of them in repairing some of our rolling stock. I am told that we have to refuse traffic, coal and other commodities, because the trucks are not available. My information is that coal cannot be exported because we have not got the trucks to carry it. If we go to any of the railway yards and see the rows of trucks standing idle, it becomes pretty clear to us that some of the unemployed could with advantage to the State be absorbed in this work.

I should like to air a grievance which prevails very largely among the railway workers and particularly among those who draw small wages. The hon. member for Vrededorp (Maj. Roberts) also referred to the matter in his speech on the budget. We find that people complain that it is very unjust that while they go on leave without pay, they have to pay house rent none the less. It may be said that although they are away, the house is still at their disposal. When one comes in touch with a less privileged class of people, however, it is no use adhering to the prosaic law of equity and inequity, to the law of an eye for an eye, or a tooth for a tooth. Although those people may not be able to appeal to the law of equity, they can appeal to the law of mercy. I am convinced that the railways are quite able to surrender the few shillings which they make on the small houses of those people who are away on leave, and this would, to a certain extent, counteract the losses which the railways are suffering in consequence of the dissatisfaction prevailing among those people. If we have to measure everything with a tape measure, we shall also find that the services that arc rendered to us are measured with a tape measure. I heard last night from an hon. member that some time ago a sort of promise was made that those people would be met in some wav. Apart from this reason, there are two other big reasons which can be adduced. The first one is that many sections of our community are getting something to-day and I am asking hon. members, as those people are asking us: “What do we get?” And what, will our answer be? Those people are paid least of all, and they will put that question to us. I should like to have a reply from the Minister to this question so that I can inform my people on the subject. Another great reason is that we have in the past always had a vertical division. This was quite bad enough, but if those people are allowed to nurse that grievance we shall in the end be faced with the position of running the risk of the possibility becoming a reality, as was mentioned by a person in authority, that we shall get a horizontal division. It will be a division between the class possessing something and the class possessing nothing. We must do everything in our power to avoid that sort of division.

The hon. member must confine himself to a discussion of the subject.

I am doing so, because if we do not meet those people they will have a grievance which will be very detrimental to the railways, and I am making an appeal to all hon. members representing railway divisions to give their attention to the matter. That grievance is felt everywhere on the railways. I hope that the acting Minister of Railways will be able to make a statement as to what can be done for those people, because those people expect to get something.

I want to support the plea of the hon. member for Sea Point (Maj. van Zyl) for some consideration to be shown to the railwaymen who are being retrenched at any early age. One man whom I saw before I left Pretoria was retrenched at the age of 52 after many years service at a pension of £4 19s. 4d. a month. He was doing excellent work, and two men are now doing the work which he was doing because they are working at a much lower rate of wages. The appeal the hon. member made for the men of the workships should also be considered, these men have suffered a severe reduction in wages and there is now a demand for more wagons owing to increased traffic, and these could easily, I understand, be repaired. There is no reason why the Minister should not get these men back and get the wagons in a state of repair to meet the increased traffic. Then I want to put to the Minister the difficulties under which certain pre-Union officials are suffering. The Minister has promised to go into what he calls “hard cases.” With regard to those men who are said not to have a sufficient knowledge of the other language, many of these men do not come into contact with the public at all. There is one man whose sole work is confined to purchases from overseas, and he probably never sees an Afrikaner once a year, and yet that man is stopped at the £360 barrier because he cannot pass the test. I am in hopes that the Minister will go into these matters and see whether something cannot be done to help men who are penalized because of their want of knowledge of the other language. There is one case, that of a man of many years’ service, who was five years in France, and chief clerk in one of the departments with a staff of 30 men under him who, simply because he cannot pass the test in language, although he understands it sufficiently to talk with people, is unable to pass this barrier. I do not think there are many of these cases, and their time is running out. The Minister would confer a great benefit if he would consider these cases favourably.

I would just like to ask the Minister one or two simple questions. Just before I left my constituency one of my constituents showed me a letter he had received from the administration demanding from him a school-leaving certificate. Now that man has been in South Africa for a matter of 32 years, and I do not understand what the administration wanted with such a certificate, or what the idea is. That man has passed the standard examination in Scotland when he was there, and how could he bring forward a certificate he got 44) or so years ago? Then, with regard to our “unemployed,” a number are employed on re-construction lines, and have to be conveyed there by train, a matter of 17 miles from East London. They have been paid 5s. a day, but these poor fellows have to pay 1s. 9d. a week for their railway fare, which may seem small to hon. members, but means a lot to these poor fellows, and for that sum they can certainly buy some bread, coffee and a few extras for themselves. Is it not possible to withdraw that charge? I do not want to give the Minister too much trouble, but I want to draw attention to the fact that members of the floating staff in all our ports, engineers especially, have had their grade altered. In 1932, for a first-class engineer, it was £520, for a second-class engineer £375, for a third-class engineer £325 per annum, and for a fourth-class engineer from £22 to £35 per month. That has now been altered, although the men are doing the same work as they were doing in December last. The first class is now graded at £445 as a maximum. The fourth class now starts at £17 a month, rising to £25 a month. He is a properly-graded fitter, and an engineer has to go to sea and practically serve a second apprenticeship. Men on the other type of vessels are suffering in a similar degree. I hope the Minister will go into the matter and see that these engineers are paid wages according to the wage determinations. A fitter in the railway workships gets his 18s. a day, and a duly-qualified engineer on these ships gets paid much less.

I only wish to say a few words to associate myself with what was said by the hon. member for Wakkerstroom (Mr. Martins). Those railway workers are isolated from the world and their general grievance is that they are isolated and get only a fortnight’s leave per year. When they go on leave they still have to pay rent for the house in which they live during the time they are away. I have brought the matter to the notice of the department, but there is considerable difficulty for my request to be complied with so that those people may be relieved from paying the rent. I considered, however, that those difficulties should be overcome so that we may be able to meet those white labourers.

I do not want to raise the whole question of dangerous railway crossings, but I do want to get some information from the Minister as to a particularly dangerous crossing north of the Toise River on the eastern system. It is called Box, and it is impossible to see the approach of a train. It will be remembered that some years ago a commission investigated these crossings, and this one was mentioned as a particularly dangerous one and first on the list to be attended to. I know that negotiations have taken place between the railway administration and the divisional council of Cathcart, and I know that that divisional council was prepared to bear a certain amount of the expenditure. What is the hitch? I should like the Minister to find out and press the matter, to see, at all events, that something is done. The great northern road serves motorists as far north as Rhodesia, and thousands of motorists pass over this crossing. Very serious accidents, even within recent months, have been just averted. The matter has been hanging fire for three or four years, and nothing has been done.

The appeal which has been made by the hon. member for East London (City) (Mr. Bowie) does him a considerable amount of credit. It was on behalf of the floating staff, but does he not know that it is useless to appeal to the Minister on matters of detail, which details are part of the general policy of the railways; and the railways, like all State departments, are continually making an effort to depreciate the standard of those engaged in the public service, thus setting a most pernicious example to all other employers. You will find that depreciation going on everywhere, taking various forms, and it is deliberately designed to bring down the whole standard of the nation. Do not accuse me of exaggeration. Nobody knows that better than he. Even when he was in opposition, so-called, he was still urging what he is now able to carry out, in part, at any rate, that is, a reduction in the standard of living. He did not mean it that way, he did not say it in that way, but a reduction in the cost of running inevitably means a reduction of pay for those people who are doing the running. I think the Acting Minister has a unique opportunity. I hope he will be able to profit from his short experience of the administration of the railways, and that he will be able to give the benefit of that to the Minister of Railways when he comes back from that jaunt of his overseas, and urge upon him and the rest of his colleagues in the Cabinet that the time has arrived for them to re cast their outlook on the whole economic life of the nation, and regard money from the right angle, that money is only a medium of exchange, and not something that is to be worked for all the time in order that it shall be saved in our national life. That is not economy at all, and it is certainly not correctly defined as economy when you apply it in the direction of a depreciation of the general standard. I want to urge upon the Minister the desirability of the immediate restoration of all the cuts, not only in the statutory rates of pay and salaries, but allowances also. I will explain what I mean in a negative sort of way. The Minister will claim that restoration has already been made as from April 1st. I have one case which is one of very many where a man lost a round sum of £10 per month owing to the cuts. As a result of the restoration that they boast about, that man has had returned to him the sum of 17s. 6d. per month.

Have you got the details?

I will give them to the Minister.

We can give you an abundance of cases.

I explained that this was only one of many cases. The man’s paysheets will show it. This is including cuts in allowances and every other privilege. His cuts amounted in the total to £10 a month and the restoration amounts to 17s. 6d. per month. The general public has got the idea listening to debates in Parliament and reading public statements by men like the Acting Minister that the railwaymen have nothing to complain about. The Acting Minister, the Public Service Commission, and every other authority concerned says that a restoration has been made, not restitution; that, of course, I am also urging; but restoration, they say, has been made, and, in consequence, the railwayman has nothing to grumble about. They have, it is said, got over the period when they had to live down, but now everything in the garden is lovely, and they have had the cuts restored. They have had nothing of the sort. They have not had even a very small percentage restored to them, and I say the time has arrived for the whole of the cuts to be restored. I want the whole amount restored at once. I know of no more potent act on the part of the Government in the direction of accentuating, if not actually causing the general depression, than the cuts that were made in the railwaymen’s salaries. I also want to give credit to the hon. member for Sea Point (Maj. van Zyl). His heart is touched, too; I hope it may last until he occupies the seat of the mighty over there; although that is very problematical. I know it is not yet, I know there is no danger. The cuts amounted to over £2,000,000 per annum. The withdrawal of that amount of money from circulation has, in itself, caused the depression, and has largely accentuated it. The whole country is suffering. I ask the Minister if he can justify that act. I suppose he will say, as the Minister of Posts and Telegraphs said, that the railway is a business concern. I want to elaborate that, and inform the Minister of Railways and the Minister of Posts and Telegraphs, incidentally, that it is the nation’s business and it should be a national business concern, and any act of any department of the nation’s business which causes a general depression through the country is bad business. [Time limit.]

The discontinuance of the temporary wage reductions apparently applies only to the European staff. The cuts were made at the same time to the non-European staff, but there is no sign of their being restored. The hon. member for Benoni (Mr. Madeley) spoke of the effect of this on the whole economic life of the nation, but he apparently failed to remember that the nation consists of other individuals besides Europeans. The hon. member gave one hard case; I can give 35,084 hard cases, that being the total number of the non-European staff employed by the railways and harbours, according to the last annual report of the general manager. I think the time has come for the restoration of the cuts to the non-European staff. True, it would only mean a difference of about £4 11s. per annum to each of them, but that would make a very great difference to their economic life. As far as I know their wages have not been increased for the last 20 years, although the cost of living is undoubtedly very much greater than it was 20 years ago. I hope the Minister will seriously consider giving early effect to the restoration of these cuts. Surely, having regard to the improved financial condition of the railways, it should be possible to restore the cuts to the non-European staff. I do not know whether the Minister is aware that many men are employed on the turning basin in Buffalo Harbour partly as a measure of relief. It is very hard work. But often these unfortunate men are only able to earn a wage of 1s. 9d. a day. Many of them, no doubt, are not physically fitted for the work. Some of these men have waited on me personally, they have produced their paysheets, and I have had them verified, both by the railways and by the Labour Department, and I think I am only doing my duty in bringing this matter to the attention of the Minister. Many of these men are unable to earn a wage which is sufficient to keep body and soul together.

I again wish to avail myself of the opportunity to refer to the question of the white labourers on the railways, and I wish to associate myself with what was said by the hon. member for Wakkerstroom (Mr. Martins). It should be remembered that if the white labourer gets a fortnight’s leave a year he still has to pay his house rent, not only has he to pay his house rent, but he has to take his leave without pay. Those people are not paying wages on ordinary holidays. The consequence is that if one of those labourers wants to take a week’s leave, e.g., it pracally means that if he cannot pay his house rent, merely in order to take a little rest, he has to leave that house, or otherwise when he gets his wages again he has to pay the lot for that week’s rent. It is totally out of proportion because the wage he gets is small, and the house rent is not at all small. Consequently, it is impossible for the labourers to take a holiday. If they take a holiday, they are faced with all kinds of difficulties. I hope that the Minister will agree with me that the people who do the work of white labourers on the railways are not able to work year in and year out if they are not allowed to take, at least, a fortnight’s holiday a year. I am consequently not merely urging that those people should be relieved of house rent when they go on holiday, but also that they should be paid full wages when they are on a holiday. The railway administration can stand this because it will not amount to a great deal. If those people are paid their wages, I can assure the Minister that he will get far better services from them and that the amount he will thus save will compensate him for the amount of any expenditure. I also wish to urge the Minister to take into serious consideration the question of raising the wages to 7s. a day of the people who work on the railways. I associate myself entirely with the view of the hon. member for Benoni (Mr. Madeley) that we cannot pay too high a wage to-day in order to strengthen the purchasing power of the people and thereby to combat the depression. I do not want to go so far as to say that the Government has caused the depression, but I do want to direct the attention to the fact that the depression can be greatly relieved by raising the purchasing powers of officials and labourers. It is of greater importance that money should be put into circulation than to keep it in the Treasury. I further desire to direct the attention of the Minister to conditions at Kazerne, where railway wagons and trucks are washed. Owing to the lack of wheelbarrows those people often have to stand in the mud and the water up to their knees, and the work is also greatly delayed owing to the economy that is practised in regard to the purchase of a few wheel-barrows. In consequence of the circumstances under which people have to work their health is affected and they get rheumatism. In view of the fact that those people have to work a lot and get little pay, I hope that the Minister will meet them, because if they get ill they have to be paid off and then they become a burden to the State. I further want to point out that those people used to be supplied with oilskins during their work, which have now been taken away from them and in place of those they have been provided with bucksails which were no longer good enough to be used for trucks, and those bucksails have to be used for the purpose of being turned into jackets and trousers. If they work for half an hour in those clothes they are wet through. I want to ask the Minister whether it is not possible to return those oilskins. Another grievance which those people have is that they are not supplied with a proper place to have their food. They only have a small building without a floor where there is half a foot of sand and there they have to eat and change their clothes. Nor have they proper accommodation for washing. Those people asked for a shower so that they might be able to wash themselves after work, but they were only supplied with an open-air wash-basin which was so small that a child could not use it. The place where they have to eat is disgraceful and repugnant to them. It should at least have a floor and it should be kept cleaner. There is a native who has to keep the conveniences clean, but the work is too much for him if he also has to keep the other buildings clean. The foreman has laid it down that these people must keep the places clean themselves in their spare time, but that is unjust. I hope the Minister will be able to do something in this respect. Then I want to refer to the abnormally long hours of people engaged in the catering service. The staff of the dining saloons is kept busy from morning until night, and it happens that people who are engaged on work in the dining saloon only get home once in every eight or ten days, and when they do return the major portion of the day is taken up by their having to get the dining saloon ready again for the next journey. I want to ask the Minister why a few additional dining saloons are not put into traffic, and why a few more people are not engaged, especially in view of the fact that many people who used to be employed in the catering service are unemployed to-day.

I wish to bring a grievance of the railway workers to the notice of the Minister. Those people are provided with second-hand tents which are full of holes, and it is felt that it is impossible during these cold winter nights to live in those tents. When it rains the rain comes through the canvas and I want to make a special appeal to the Minister to provide the labourers with tents that are water-proof, and which will be of greater protection against the cold. Another difficulty experienced by those people is in connection with medical attention. As they work on the railways they are looked upon as people who draw wages, with the result that they have to pay the full medical tariff. They are prepared to contribute a certain amount per month in order to get free nursing for their families. I hope that the Minister will consider the difficult position in which those people find themselves, and that he will also raise their wages. People from the rural areas drift to the dorps, with the result that house rents go up. A man like that must, in the first place, see to his house rent, in the second place, he has to see to clothes for his family, and in the third place, to food, with the result that the money available for food is often not sufficient. I further want to point out that there are many people among them who are skilled masons or carpenters. The time has come that people of that kind should be taken away from work on the railways and that they should be given an opportunity of working at their trade.

I should like to take advantage of the half-hour rule. At the outset I want to suggest to the Minister that the Government should attempt in future to give greater opportunity for the discussion of the railway budget itself. The Minister knows that the position is that the two budgets are delivered, the one after the other, and then the House has four days for the discussion of both. On the last day of the budget discussion, about four members were able to rise and discuss railway matters and then the House reverted to the discussion on the main estimates.

The hon. member cannot raise that point now.

Surely I am entitled to discuss the policy of the Minister in giving the House so little opportunity to discuss his estimates?

The question of the time allowed for the discussion of the estimates cannot be discussed now. It is not a question of policy.

Surely it is a question of policy whether the Minister will see to it that more days are set aside for the discussion of the railway budget? I would ask the Minister whether it would not be possible to set aside at least one day for the discussion of the railway budget alone. Now, Sir, railwaymen generally were glad to notice a certain amount of optimism in the railway budget as a whole; but that is as far as their satisfaction could go, because there was no reference at all in the budget speech to the possibility either in the near future, or in the far future, of a restoration of the outstanding wage cuts. I think that this matter can never be over-emphasized, because there is so much confusion in to tackle the railway question. I should be glad if he would inspect the Salt River works, for instance, so that he could see the men at their daily job. I have spoken in regard to the cuts generally, and I now wish to refer to the restoration of cuts to the non-European railway staff. I have already seen the Minister personally in regard to this matter. We all realize that when the 1932 graded railway cuts were restored it did not involve the restoration of cuts to non-Europeans, as they had never been affected by those cuts. We all imagined, however, that when the cuts in the pay of the non-European staff were carried into effect in October, 1931, that that was part and parcel of a sacrifice to be demanded from all sections of the railway staff. The general manager estimated these cuts to total £160,000. It was clearly in the minds of the House that this was part and parcel of the temporary sacrifice that the staff would be called upon to make, but recently Mr. Pirow made a statement in this House, and previous to that he gave a reply to the hon. member for Cape Town (Castle) (Mr. Alexander), who was apparently under the impression that when the cuts had been restored to the European railwaymen they would also be restored to non-Europeans. He sent a telegram on the subject to the Minister of Railways, and in reply he received a letter, dated May 3, from the secretary to the Railway Board, which stated, inter alia—

That is the sinister passage in the letter to which we take exception.

It is a definite policy.

I am not going to accept this letter as what the House or the public were led to believe was the position at the time these cuts were made.

Why not swallow the whole of it?

We are not prepared to swallow it. We are out to see that justice is done. The Minister recently promised me that he would go into this matter with the Railway Board, and I am perfectly certain he sees the justice of the contention I am putting forward. Let me give some examples. Take the case of the catering staff. A circular was issued from Braamfontein and a scale of reductions was laid down. Where free food was not supplied a non-European getting £3 15s. a month was cut 20 per cent., and where the wage amounted to £1 12s. 6d. per month the cut was 2s. 6d. It was eventually decided that no reduction should be made in the case of employees in receipt of 30s. a month. Where they were getting 1s. a day it was agreed there should be no reduction. These were, of course, very harsh reductions, and common justice demands that these deductions should be restored and not treated as permanent readjustments. This brings me to another point, the attitude of the administration with regard to certain sections of the non-European staff. I am not going to suggest that there was any deliberate campaign against non-Europeans, but I want to give an example of what I call most unfair treatment. A non-European was retired at the age of 60 last November. He had had over 15 years’ service, and he was entitled, under the 1928 Act, to a gratuity based at the rate of ten days’ pay for every year of service. He was entitled to that because he was never eligible to become a member of a pension fund. He was entitled to a gratuity at the discretion of the general manager, and naturally the general manager always exercises a reasonable and equitable discretion. This man applied for a gratuity, and he was told that the matter would be gone into. Three months later he came to me and told me that he was about to be ejected from his house, and had heard nothing further about his gratuity. He had about £60 or £70 due to him. Through the kind assistance of the general manager’s office, the matter was rectified the very next day, as a result of representations made by me. The point I am making is that this man was a non-European, and he feels that his case was neglected merely because he was a non-European; it was not until he was on the point of being ejected from his house, when he came to me, that the matter was rectified. Let me give another example. At the Salt River works last year quite a number of non-Europeans were retrenched. They had given to the administration from 15 to 20 years’ faithful service. The administration took up the attitude that in calculating their years of service it had to deduct from that service 20 per cent. to make for possible absences from duty on account of leave or sickness. Can you, sir, imagine a more arbitrary rule? I had the case of a nonEuropean, who had a little over 20 years’ service, brought to my notice, and in that case the administration took up the attitude that 20 per cent. had to be deducted from his service. I do not know who deals with these matters, whether it is the Staff Control Board or not, but I would like to urge upon the responsible officials that there should be something of the milk of human kindness in their deliberations. I urge on the Minister to ascertain who is responsible for this sort of thing. I received a letter from the Staff Control Board saying that the case referred to by me could not be readjusted, although I was able to have the matter put right through other channels. I do urge upon the Minister to obtain some co-ordination between the different sections of the staff, so that one section of the staff may not be permitted to sully the name of the administration. I should like to congratulate the administration on the appointment of a legal head, who is going into the questions of appeals and disciplinary action generally. I think it is a step in the right direction.

A legal man will make it worse.

I do want to emphasize what I said at the outset, that the acting Minister with all his business knowledge and experience, has an opportunity of having firsthand knowledge of the difficulties of the administration and its policy in the future. The Minister must realize that unless some drastic steps are taken to try to pull the railways out of the morass into which they have fallen, we may as well say good-bye to railway traffic. We are faced with the competition of motors and the competition of the air. The capital of the railways is something like £160,000,000, this being the amount that has been sunk in the railways, and the yearly interest, I am told, is something like £6,000,000. That dead burden of interest around the neck of the Railway Administration is killing it. How the matter is to be adjusted, I cannot say. Something drastic has to be done, and I appeal to the Minister to give serious consideration to the matter.

They’ll cut the wages.

That is not the way to put the administration on its feet.

But that is the way they will do it.

No, I have sufficient confidence in the Minister to believe that the moment it is right to do so, he will try to tackle this along right lines. We know that the Treasury relieved the administration of the burden of interest on £13,000,000 from April of this year. I would urge the Minister to do something on an unprecedented scale in order to assist the railways, something heroic in the way of relieving the administration of the present killing burden of interest, because there is no doubt that our railways are losing popularity. Railway users are not making that use of the railways which they did in the past, and something must be done to attract an increase of traffic. As a result of such increase, money will flow into the administration’s coffers, and all sections will benefit, including railway workers. One way of increasing traffic is to cut fares. It is a psychological question with the public. The Minister, if he gets to grips with this problem and tackles it along national lines, will do a service to thousands of railwaymen, a service to South Africa.

I think I had better reply to some of the questions which have been asked. In the first place, with regard to the question of the hon. member for Durban (County) (Mr. Eaton), I would say with regard to staff control, that it is an advisory body under the general manager who has control of it, and therefore there is no reason whatever to suggest that staff control controls the general manager. It is news to me that it does. I think that that matter can be put aside altogether. The general manager is the one responsible for running the railways, and, as far as I am concerned, he will continue to be responsible.

What does the Railway Board do?

It advises the Minister. There is no reason why the Minister should not seek advice. The hon. member for Sea Point (Maj. van Zyl) criticized the retirement of so many men. It is quite true that we may retire men before pensionable age, but the railway revenue has to bear the burden up to the normal age of retirement, and it is a very good arrangement. It acts as a check on the railway administration before retiring men; they know it is a burden on the railway revenue, and they have to be careful.

That is what you call a theory.

It is not a theory. Only during even the few weeks I have held the railway portfolio I have seen that has acted for the good of the men concerned. Personally I hope that we have come to the stage when we have finished with these retirements. I hope we have arrived at the bottom of the trough, and that we are gradually moving up, and that some of these questions are solving themselves. Then the hon. member paid us rather a back-handed compliment on keeping expenditure down. I should like the committee thoroughly to understand that expenditure has to be kept down. Even if the railway revenue does increase, we have a big margin between losses and revenue that has to be made up before we can show any signs of extravagance; and, with regard to the reductions quoted by the hon. member, of course, the very fact of the proportion of the expenditure of the railways being so largely staff expenditure, naturally means that when the traffic goes down, retrenchment of the staff has to be considered. As to the suggestion of the hon. member for Benoni (Mr. Madeley) that the expenditure on the staff should go up rapidly, it went up like a balloon, and it is always the fault of these Government departments that, when things are reasonably good, up goes the expenditure; and instead of hon. members restraining the Government, they all ask for new expenditure in these circumstances, and the result is that Government departments suffer more from a depression than almost any other class of work. The hon. member seems to base his percentages on the open mile. I would much rather that in future he based his expenditure percentages on the turnover of the railways. The essential part of the business is to make the railways pay and if you have a certain revenue and your various items of expenditure add up to one hundred and four per cent. you will make a loss. I cannot see that you are ever going to get more out of an orange than what is inside it.

You can get indigestion and that is not inside it.

If your various items of expenditure exceed 100 per cent. you will make a loss. I do suggest that is a more efficient way of checking your expenditure. The hon. member brought up the question of permanent way maintenance. We are looking into that. As regards depreciation, it is quite true that our variation of depreciation had something to do with the depression. I do not know that it is not a reasonable thing to have done. The depreciation previously, after investigation, was considered to be in excess of requirements. Well, I agree that the depression probably has a psychological effect on the administration. If things had been very good, they would have found that the depreciation was all right. Personally I believe that every business in the country did the same thing. The railway administration are satisfied that their present arrangement for depreciation is sound and defensible.

So you have to be satisfied, too.

Yes, I am satisfied. As regards rolling stock, we are keeping in order the rolling stock which is necessary for the work that has to be done within a reasonable period. Owing to a considerable improvement in the demand and in the traffic, there is a temporary shortage to-day principally on account of two things; one, the movement of the drought stock and simultaneously with that, an increased movement of coal. It is quite evident that it is only businesslike to keep in repair such rolling stock as will be likely to be required for the next three or four months. It is uneconomical and unsound to keep in repair hundreds of wagons which are not likely to be wanted for two or three years. Perhaps I had better deal with the question of the cuts. The cuts that were restored amount to £660,000, out of £2.000,000 odd that hon. members have spoken about.

It is £530,000.

No, it amounted to about £660,000.

The latest figures given by the Minister, to the 30th May, show the total amount to be £530,000.

The amount is £660,000; however, the principle is the same.

So is the interest.

So that one-third of what these hon. members call the “cuts” have been restored. As regards these individual cases, mentioned by hon. members, they are earnings for different purposes, that is, they do not come under the one heading. For instance, there is over-time, piece-work, Sundaytime and other matters of that kind. Those cuts have not been restored and they have affected individual men in different ways, but on an average, one-third of the cuts have been restored. The non-Europeans were never cut under that Act—

No, they starve under another Act.

—and that is the point made by the hon. member for Sea Point (Maj. van Zyl). Now as regards those cuts—they are what the railway administration calls re-organizations.

Blessed word !

I personally must let that matter stand over until the Minister of Railways comes back, because that is a matter which has been dealt with since 1931, and I am not prepared to deal with it within three months. Now the hon. member also raised the question of railway interest, which is a very important point. If you take the railway figures, the interest items and the labour items are the two items which control the railways, and those are the two figures which make the railway figures so inelastic. When the revenue of the railways decreases you still have those two inelastic figures which prevent you from reducing your expenditure proportionately. As regards the question of interest, the railways no doubt have a case which they could put up to the consolidated revenue fund, and perhaps at some time or other, when we have finished keeping the farmers on their feet, and we are rid of all these extraneous expenses, we may be able to deal with these matters, and we may find the Minister of Finance in such a mood that he will be prepared to consider dealing with this question of railway capital. It is quite clear that as a business proposition the railways are very much too heavily capitalized, and it is going to be very difficult to make our railways pay, because we have this heavy burden of railway interest, which has to be paid in some form or another. Whatever the position may be, whether this interest, or part of it, comes off the railway budget, or whether it comes off the consolidated revenue fund, it still has to be paid, but the question is what would be an equitable arrangement as between the railway finances and the general finances.

What do you hope to gain by conversion?

What one hopes to gain is this—if the railway expenses go down you can then deal with the rates and freights position.

No, what amount do you expect to gain from conversion?

It would be unwise for me to say what I, as a railway Minister, would suggest. I think that the hon. member had better wait for a suitable time when things are better, before discussing what the amount is. The hon. member for Wakkerstroom (Mr. Martins) and the hon. member for Vrededorp (Maj. Roberts) have raised the question of European unskilled labour. If you are going to make European labour expensive, you will thereby set up a standard which will render the employment of European non-skilled labour dearer to the department. Hon. members must remember that we have to carry on the railways as economically as possible, and if they suggest that non-skilled European labourers are to have 14 days’ holiday, they will help to load the case against the men they wish to befriend. That was the position taken up by the late Mr. C. W. Malan, and I think it is a fair one. As regards the payment of the rents of administration houses, when the tenants are on leave, I feel that hon. members do not appreciate that if the tenants do not pay rent, when they are away on holiday, then the railwaymen who are not in the fortunate position of occupying houses owned by the Railway Department are unfairly treated. The latter men will contend that it is not right that they should be called upon to pay rent to private owners when the Railway Department relieves those occupying its houses of rent whilst on leave. The bulk of our railwaymen do not live in houses owned by the administration. I am perfectly willing to consider the matter again during the recess, but I should like to have an assurance that the men who do not live in our houses will not complain and will not ask for something to be done for them. With reference to the point raised by the hon. member for East London (North) (Brig.-Gen. Byron), I may say that the men to whom he referred are being given more suitable work. As to the point raised by the hon. member for East London (City) (Mr. Bowie), it should be understood that the conditions he referred to do not apply to the present occupants of the post, but to the new incumbents.

Tn other words, it is a reduction of the standard, in pursuance of your policy.

I would explain to the hon. member that there is no institution in which the standard of the men is so well looked after, and kept so closely in view, as an institution which is financially sound. If our railways are in a sound position, it will be to the benefit of the staff particularly.

You want a sound Government to do it.

We have got a sound Government to do it. We have all the conditions to-day which are favourable to getting the railway into a sound condition, and every improvement in the railway position helps to improve the position of the railway staff.

It is somewhat surprising to hear the Minister, in dealing with the question of reduction of wages, suggesting that there is anything sound in paying a qualified engineer £17 a month. It is unfortunate that many of the points of policy which have been raised cannot be dealt with by the acting Minister in the absence of the Minister of Railways. That is unsatisfactory to the House. There is one point I wish to mention to the acting Minister. Will he inform the House whether the staff will be invited to give evidence before the Commission? There is another matter I wish to refer to, and that is in regard to the reduction of a second class machine man in Durban. I have in mind an instance in Durban where a second-class machine man applied for promotion a couple of years ago, and was told that it was only because there were no vacancies in the first class that he was not promoted. In the meantime, he has resented reductions in the time rates, and for that reason he has been reduced while juniors have been retained. I should like the Minister to enquire into that matter. I will give him the details personally.

I want to ask the acting Minister of Railways whether he can do anything in connection with the following case. There are many complaints in respect of the carriage of stock from the Eastern Province. There are many people who say that the prices for stock are fairly good here in the south-west of the Cape, and stock is sent from the Eastern Province by rail but it usually is sent by goods train on which other livestock is also carried. Livestock is constantly held up at places like Mossel Bay and De Aar with the result that it arrives here in poor condition. I want to ask the Minister whether it is not possible to collect the stock at fixed times and to run a train for stock only so that it may arrive in good condition and the farmers may get decent prices.

There are one or two matters I want to bring to the notice of the Minister. One is the yearly complaint made in this House with regard to the pilfering that goes on on the railways, and I think a considerable improvement could be made in regard to the losses sustained by the public on account of this pilferage. Railway users are put to a great deal of unnecessary inconvenience in obtaining redress after having suffered these losses, and sometimes it takes months. The railways try all they possibly can to evade paying compensation to losers. I think this is a matter which requires very urgent attention. I notice that, since the private lorries have been thrown off the roads, the railways are not nearly so efficient as they used to be. Formerly, when there was that competition and you threatened the railways that you would use lorries, you got immediate attention and you got delivery of your goods without unnecessary delay. Today, things have become slack. The railways know they have the control. I speak from personal experience. I know of a case of a man from England who sent a motor car up to Pretoria by train, and every tool was stolen from it. Things were lifted off and even prised off that car. That sort of thing cannot continue. One is afraid to send your motor ear on the railways, with anything in it. If there happens to be anything useful in the car, it is stolen. Even if there is a tool-box that is bolted on, it is taken off. This pilfering is becoming a very serious thing, and the time has come when the railways should make it clear to any one of their servants, that if he pilfers he should be dealt with severely.

They are dealt with severely.

Are they? I know of a number of cases where they have been let off without any imprisonment or fine at all and dealt with under the First Offenders’ Act. I say the time has come when this grievance of railway users should be dealt with in a drastic way. Another matter I want to bring up which is brought up every year, and that is the shortage of trucks in Natal to deal with the coal industry. That industry, as the Minister must know, has been through a very thin time, and they have had to face very grave difficulties. This year there has been an improved demand for coal, and they have had an opportunity of disposing of their coal, but they have been met with the same answer: “We are sorry but there are no trucks available,” with the result that the coal industry has suffered very considerable inconvenience and loss. This takes place every year. One year the excuse is made that there are no trucks available because mealies are being moved, and the next year the excuse is that stock have to be shifted in drought-stricken areas. The time has come for the railways to see that there are sufficient trucks available. It is quite right and proper that preference should be given for the removal of cattle in drought-stricken areas, but my complaint against the railways is that they have not sufficient trucks available, and they ought to make provision for more trucks. I hope the acting Minister, in regard to the first matter I raised, will not say that it cannot be put right, because there is a deficit, or because there is a depression. There is no reason why that matter cannot be cleared up. The railway department, now that they have control of everything with the whole transportation system in their hands, should take every possible step to protect users, and to see that when people hand over their goods for transportation that goods are delivered intact and not pilfered.

It is a matter affecting Pretoria that I wish to bring up. Some two or three years ago an amount of £100,000 was placed on the capital and betterment estimates, for the lay-out of the workships at Capital Park, Pretoria. In 1932, £12,000 was estimated to be spent, but nothing has been done. I would like to know if the work is to be proceeded with. Some years ago, when the wagon repair workshops were shifted to Germiston, it was said that it was to make room for the carriage shops at Pretoria, but we are informed that they are now building railway coaches in the Germiston shops because they say there is no room at the Pretoria shops. I want the Minister to say if the arrangement arrived at, viz., to proceed with the new lay-out at Capital Park is to be carried out.

I would like to ask the Minister what the policy of his department is in regard to the electrification of the Cape Flats line. During the recent nomination election campaign all sorts of promises were made by my opponents. One person promised an overhead railway bridge, and another the electrification of the line, so the only thing that was left to me was to promise to stop the south-easter. I could not do that, so as not to be outdone, the only thing I can now urge is that the Cape Flats line should be electrified, and that a circular route should be established —something of the same kind as the Inner Circle line in London. We have to look to the future. In 50 years’ time Cape Town will have extended in the direction of the Flats. Therefore I would suggest that land be expropriated between Wynberg and Lansdowne for this purpose as soon as possible before the cost of this land becomes prohibitive and this scheme abortive. We have at Pinelands an example at what can be done in the direction of laying out garden cities and the time will come when similar garden cities will be laid out in all directions in the Cape Flats. The cost of building and electrifying a line such as is required, will not be very heavy and I hope that the Minister will give the matter his serious attention. Now to come from the sublime to the ridiculous, I want to ask the Minister to reduce the charges at Cape Town docks in respect of the cold storage of fruit. If he cannot reduce the actual charges, I think payment might be placed on a daily basis instead of on a weekly basis as at present. Fruit often arrives at the docks on a Wednesday and is not shifted until the next week. The fruit may only have been in the docks for eight days and yet a charge is made for two weeks. Then the cartage charges on fruit at the docks might be reduced. If one box of fruit is rejected, there still is a high minimum charge on that box which means a dead loss to the producer. These matters are of importance to the fruit export trade and require attention.

I want to ask the chairman whether the hon. member who has just spoken, and who referred to the question of the electrification of the railway line, was in order under this head, in discussing a question which will involve capital expenditure.

I have allowed matters of policy to be discussed on this vote in the hope that they will not be discussed on other votes.

Business suspended at 12.45 p.m. until 2.20 p.m.

Afternoon Sitting.

I wish to bring to the notice of the Minister a case that happened on the railway at Germiston where there is a native who does the work and occupies a position that should be held by a skilled official. The name of the native is Frans. His work, inter alia, is to repair stoves, rubbish bins and water tanks in the houses. This work was always done by a skilled worker and is still done by skilled artizans in other parts of the Union. It is only in this instance that it is done by a native. I shall show the Minister the papers in which the native is instructed to do this work. The fact that a native does the work of a skilled artizan causes dissatisfaction among the skilled men and I should be pleased if the Minister would put this right. Then we have the fact that on the Germiston-Volksrust line apprentices are not working under the supervision of skilled officials. The fact that the apprentices are not under the supervision of a skilled worker is regarded as being responsible for the fact that the apprentices do not do good work and do not receive good training. The time of those young men is wasted because when their period of apprenticeship is completed they are not able to take up their positions as skilled workers. I shall be very pleased if the Minister will also give his attention to this.

This morning the hon. member for Pretoria (East) (Mr. Giovanetti) referred to the question of bilingualism on the railway. My idea is, and it is also that of the department, that men over 50 should be treated with considerable leniency in this matter, but now—23 years after Union—men under the age of 50, that is to say men, who were 30 years of age and under when union came into force, should be bilingual by this time. It is only natural to-day that the administration should see that their clients are spoken to easily in both official languages; therefore, there will be no relaxation in regard to that. There is another aspect of this question. A vast number of our men have taken great pains to become bilingual; they have spent hours in study and have passed examinations, and they deserve every credit for making themselves efficient bilingually. Surely, it would be very unfair to these men if we kept them on the same basis as men who have not taken the trouble to become bilingual. As to the men over 50, the matter will, in a very few years, solve itself, as these men will retire, and then the service will become entirely bilingual. I will look into the point raised by the hon. member for Vrededorp (Maj. Roberts). The question referred to by the hon. member for Maitland (Mr. R. J. du Toit), will receive consideration. As to the charges at Table Bay docks, I may explain that they are based on the cost of doing the work. Therefore they cannot be decreased. If he wishes the charges to be reduced from a weekly to a daily basis that will slightly increase the amount of the charges, because of the cost of the extra labour. The hon. member for Durban (Umbilo) (Col. McArthur) asked whether the staff would be allowed to give evidence before the commission. I see no reason why the staff should not give evidence. I take it every class of evidence will be given before the commission. With regard to the question of removal of stock, I can assure the hon. member who raised it that every means will be taken of facilitating the removal of stock. As to the matter referred to by the hon. member for Newcastle (Mr. Nel) I think he rather exaggerated his case, but the matter shall be looked into. The matter of shortage of trucks for coal traffic has been mentioned. I have looked into this, because of newspaper articles I have seen, and I must say that the articles were exaggerated in the extreme. There has been a hold-up in the last few weeks, owing to the movements of drought stock, but that is clearing itself, and I do not think any grave damage is being done. I would suggest to the hon. member for Newcastle, who is interested in this matter, to use his influence with the coal owners to pool their coal at the Bluff. The position is that they use our trucks to store their coal, and hold up the trucks. It would be a great convenience if the hon. member could persuade even some of them to pool their coal. I can assure hon. members that the shortage of trucks has been very greately exaggerated. There is a temporary shortage, but it is not of any great moment.

I would like to put a few questions to the Acting Minister. First, I wish to say that it has been generally appreciated that the department will find a lot of work for the unemployed in connection with the work they propose to carry on. After expressing appreciation in that respect, I have one or two complaints to bring forward. The first deals with the position of the tally clerks at Port Elizabeth. As I am given to understand, the rate of pay for these men is 10s., increasing by 6d. a day annually until they reach 15s. a day; but, unfortunately, the cuts of April, 1932, reduced them all 1s. per day, plus 2½ per cent. On the restoration of the cuts, the 2½ per cent. was restored, but not the 1s., and I am also informed that there are to be no further increases, that is, that a man starting at 10s. remains at that figure. When the 2½ per cent. was restored, they had half-an-hour added to their working day, which was more than equal in value to the 2½ per cent. I find that they work on an average about nine hours per day, that they have only from 10 to 15 days’ work per month, which, in the case of the highest paid men, means that their maximum pay is about £11 5s. Od. The position is that these men have to report every day at half-past six in the morning, on the chance of being taken on for a day’s work. The work is hard, and one cannot wonder that there is a certain feeling of dissatisfaction amongst the men. After all, one must realise that they have very responsible work. A mistake on their part might easily cost the department a good deal, and you cannot expect to get the best work out of men who feel that they are not getting a fair deal. Unfortunately, most of them are men who at present are unable to find other employment, and therefore have to take what is offered them, but I am going to appeal to the Minister to enquire into the matter, and see if he cannot restore them to the position they held before the 1932 cut; that is, to restore the 1s. per day. I do not know whether I am correctly informed, but I am told that their pay is debited by the Administration in the landing charges at the rate of 15s. per day per clerk. If that is the case, it seems hardly reasonable that the department should charge the full rate in the landing charges, when they do not pay it to the men. There is one other class of railway worker on whose behalf I should like to appeal to the Minister, and that is the casual labourer. The position to-day is that these men, after 12 months’ work, are permitted to take 12 days’ leave without pay. Men earning the rate of pay which they are getting are hardly likely to be in a position to take a holiday, but that is not the worst part of it. They are allowed to take the holiday; in fact, to a certain extent, they are encouraged to take it by the Administration giving them a free pass. The unfortunate part of it is that, on their return, there is no guarantee that they will be re-employed. It is rather hard that a man, after working for 12 months, should have 12 days’ leave, and then, on returning, may find that he has no job to go to. A case was brought to my notice of a casual labourer last year, who, on returning from leave, was told that there was no work for him. He was kept out of work for at least seven days, and then was put on to work that was too heavy for him. The view I hold is that the department should either not give casual labourers a free pass, or they should undertake to see that when a man goes on holiday he at least has a job to go to when he comes back. I think the committee will admit this is particularly hard on those men whose pay is iniquitously small as it is. Their work is the same day after day, with no recreation, and the least the department might do is to see their job is secure after their holidays.

I would just like to ask the Minister whether he is aware, in regard to the floating staff to which I referred this morning, that in October, 1931, the date fixed by the administration for a conference, that this was cancelled. These men felt very disappointed, after having waited so long, that this conference was to be cancelled. In this particular instance they have had no chance at all of putting forward their representations. These men and I would like to know what was the basis on which the new grading was reckoned, because generally it was expected that the pay of engineers was commensurate with the pay of fitters in the home ports. I want the committee to know the full facts of the case, because I think these men have not been consulted sufficiently, and have not had a square deal. They should like the administration to know what their position is.

The administration knows all right; it is their deliberate policy.

I would like to raise a question which has already been touched upon, but was not satisfactorily replied to. If there is one section of the people on the railways who are badly exploited, it is the non-European railwaymen, and if a private employer were to pay such wages as the Government does on the railways to these men, there would be an outraged cry from the whole country. When, in 1931, their wages were being cut, a man earning 1s. 8d. had his wage reduced to 1s. 6d., one earning 1s. 7d. to 1s. 6d., one earning 2s. 9d. to 2s. 6d., and in the catering department, men earning the enormous wage of £3 a month were cut down by 15s. a month, and those earning £1 12s. 6d.—because they were “given free food when available,” as the circular states— had 2s. 6d. taken off. I submit it was more than a cut, because it brought them down, not only below the bread line, but below the starvation line. On the 2nd May, after the information had come that the cuts were being restored, I sent a telegram to the Minister to the effect that only European men, but not the non-Europeans, had their cuts restored. On the 3rd May I got a reply very much like that to the hon. member who raised this matter this morning. I will read it.

I read the letter this morning.

Do not read it again.

I shall read it if I like. I was not here this morning.

Keep your hair on.

The letter states—

If these cuts cannot be restored, there is something radically wrong with the railways. These men came under the axe, whether they came under the Act or not. I do not think it is much consolation to these people to know that. The fact remains they have been disgracefully exploited by these cuts, and you cannot expect any man to live on such wages. Surely the small amount of 6d. per day can be restored to these people, and even then their wages are below a civilized standard. A wagon-driver who received 5s. 1d. had 6d. taken off; that is, his wage was reduced to 4s. 7d., and labourers were reduced from 3s. 6d. to 3s. and from 4s. to 3s. 6d. One of these men, who had his wage reduced by 6d. a day, had done good service for 25 years. It is not satisfactory to tell us that nothing can be done because they do not come under the Act of 1932. As they were reduced by an administrative decree, so they can be restored by it. I would like to support the protest made by the hon. member for East London (North) (Brig.-Gen. Byron) on this question. We hear a great deal of what is being done for all sections of the European community, but when you make a plea on behalf of non-Europeans you cannot get the sympathy or attention of the Minister, or of the House. I say it is very regrettable.

I want to refer to the question of the maintenance of rolling stock. What is the policy of the administration? Turning to page 63 we find that the artizan staff is to be reduced by one-sixth during the current year, compared with previous years. Then in Clause 6 of the Minister’s memorandum, we find that the cost of maintenance of rolling stock is decreased by £26,000, brought about by less repair work being necessary. Five lines further down we find that there is a cross-entry for increased repair work, due to an increase of traffic. I would like to know what is the idea on which their policy in regard to number of staff is based. Are you going to have more work or less work?

I should like to refer to a grievance which exists in Griqualand with regard to the overcrowding of buses used by natives. There is no system by which reservation of seats can be made by better-class natives who would be willing to pay for that convenience in order to avoid being herded together with the more rowdy element on these buses. This really is a grievance which is keenly felt by the natives concerned, and I should like to have an assurance from the Minister that he will do something to bring about an improvement of the present conditions.

I am sure all hon. members share the appreciation which I feel of the manner in which the Minister has dealt with all the points that have been raised. I do not mean the matter of his reply, but the manner. He knows perfectly well, however, that he cannot please or satisfy his critics with the matter of his reply. I would say to hon. members who have got up to protest and criticize, that they should have thought of all that before they went into this general election. They have given the Government a blank cheque, and they have wholeheartedly entered what they were pleased to call Coalition, or the pact, and I think the best word that describes it is collusion. They wholeheartedly supported this collaboration, they did not raise any protest, and now, when it is too late, and when they know they are only talking to the gallery—

Speak for yourself.

They cannot influence the ministry at all, and they cannot influence the public.

Whom do you influence?

Not you. One of the fundamental conditions that I lay down when I appeal to any member is that ne has the intel lect to receive my appeal. That is not personal.

The hon. member must confine his remarks to the vote under discussion.

I have to try and induce hon. members to agree with the point of view I am expressing.

It is irrelevant to the question under discussion.

I am sorry you have been so severe on the hon. member for Newcastle (Mr. Nel), Mr. Chairman.

Everything said at election time is irrelevant.

The hon. member said nothing at election time, so far as I remember.

The hon. member must confine himself to the vote.

I want to address some considerations to the Minister in the hope that he will do what a large number of other Ministers never did, and that is consider the point of view I put before him. I want to say to my hon. friend here that, as I say, with regard to the European section of the railway community, all this depreciation is part of a settled policy, and whether it is Act so-and-so, of such and such a year, or some other Act, they only use the various means they have used in order to give effect to the policy they have in mind. I want to urge upon the Minister that the time has arrived for him and his colleagues to review their former outlook on this question. What counts in our public life and in our national life? It is the opportunities that men and women have of holding the hope of leading a comfortable life, and we are not accomplishing that. I agree with every word he said about non-Europeans. They are human beings, just as Europeans are, and they have a right to a comfortable living, but, forsooth, in the sacred name of economy the Minister decides that they will reduce the standard of living of nonEuropeans as well as Europeans. I ask the Minister to reconsider this outlook altogether, and I ask that he and his colleagues should begin to regard themselves as the custodians of the happiness of the pepole, not mere writers up in the ledger on both sides, a ledger that can be altered at their will either up or down. That cuts no ice, and has no effect so far as the general sum of our human happiness is concerned. I want to urge the Minister that he should so shape his policy that he will promote the best interests of the greatest number of human beings in South Africa, not regard his department as a mere machine, something that has to be worked on a financial basis. The institution of finance has, as its object, the flow of commodities for the people, just as the railways in a mechanical way carry the goods from producer to consumer. I want to put the thought in the mind of the Minister. I know he is sympathetic enough, if that thought is given to him, to act upon it, as far as he possibly can. Examine all these questions from the point of view of what is best in the interests of the mass of the people, Afrikanders, Britishers, non-Europeans, anybody and everybody. If he does that, he will not go far wrong, and he will turn back on the policy his colleagues have initiated of depreciating the standard by reducing the pay.

It has been suggested that some of us are trying to hold up the proceedings, but I ask the committee to remember that although some of us, who want to discuss these matters, are living in the Peninsula and do not have to leave here, we have given a great deal of time to the study of these matters which are of interest to our constituents. Hours and hours have been spent on other matters during this session and, when questions affecting the railways come up, we should have the opportunity of putting forward the views that we wish to. I want to say that I have always followed the practice of bringing routine matters to tue notice of departmental heads, but when matters of policy are concerned, I can adopt no other course but to raise them on the floor of the House. I want to remind the Acting Minister that he has not replied to my question about the administration of the 1928 Gratuity Act. The criticism is often made that those members who get up in this House and plead the cause of non-Europeans, do so because they have a number of non-European constituents. So far as the hon. member for Castle (Mr. Alexander) is concerned, knowing his record of many years in public life, one only has to make a suggestion like that to realize how ridiculous it is. So far as I am concerned, I have less than ten per cent. of non-Europeans in my constituency. Out of a total of over 7,000, there are less than ten per cent. who are nonEuropeans; but, so long as I am able to, I shall always plead the cause of the non-Europeans, no matter whether some hon. members may sneer at me for doing so. The Minister has referred to the Staff Control Board. My complaint is that when I send letters to the general manager in connection with what I regard as an act of injustice, in the administration of this Act, I get letters back signed by a member of the Staff Control Board. I want to know what they have to do with the administration of the Act. I want that Act to be carried out in a fair manner and I am afraid that that has not been done. I have chapter and verse to show that the Staff Control Board have not administered the Act in the letter or in the spirit. I want to have the Minister’s views in regard to the arbitrary deduction of 20 per cent. of the men’s services. Then there is another matter, perhaps of minor importance, but still of considerable importance to a certain section of the staff. It is a matter in regard to the making of half-monthly “subs” to certain non-European members of the staff. There are a number of non-European labourers, at the Salt River Works for instance, who earn £5 or £6 per month. They apply to get an advance on their pay in the middle of the month but apparently certain sections of the staff have been refused this facility. The whole object of the system of “subbing” is to assist the poorer classes, be they European or non-European, and although it may involve difficulties in regard to book entries, I would ask the Minister to go into this matter with the general manager and see whether some relaxation of the rigid rule cannot be made in favour of these non-Europeans who wish to have a half-monthly “sub.” The administration is risking nothing, as they make the advance after the amount has actually been earned by the man in wages. For the rest, I want to ask the Minister whether he can give us an explanation of the fact that in the summary of staff there is shown a reduction on his estimates in the number of staff for 1933-’34 as cmpared with the previous year. The number for the previous year was 76,789, whereas the estimate for the year 1933-’34 is 68,940, or a reduction of 7,849. Under the heading of Harbours, too, there is a reduction of 424; in other words, according to these figures the administration is prepared for a reduction in staff during the forthcoming year of 8,277. I ask the Minister why, and where is the reduction to take place?

I should like to direct the attention of the Minister to the rates that are charged on the railway motor lorries. From time to time the Minister of Railways has made a promise that he would go into the matter and that he would see whether he could meet the farmers. Now that the Railway Board has somewhat reduced the rates on the railways. I consider the time has come to reduce the rates on the railway lorries. I wish to point out to the Minister that the rates of the railway lorries are much higher than the charges of private lorries. As the Transport Board affords protection to the railways, and the latter have a sort of monopoly in consequence, I consider that it is only right that the railway administration should keep the rates as low as possible. As the railways are being protected by the removal of private competition, their rates are imposing an extra burden on the population who are served by the railway lorries. It means in other words that if those people are paying a higher rate than that which private lorries would charge for the carriage of produce, they are paying extra tax. As those people do not enjoy the privilege of railway connection it is not right that they should have to pay higher rates for the service of motor lorries than they would pay for the service of the railways. I admit that the railways have to be protected to a certain extent, but I consider that it is inequitable to impose a heavier tax on a certain section of the population than is necessary. For that reason it is the duty of the Railway-Board to see to it that the rates shall be reduced to the same level as those of the railways and of private competitors. I make an earnest appeal to the Minister to give his special attention to this matter. There is another matter I wish to bring to the notice of the Minister, viz., the employment in the railway service of young men and young women. At the moment we find that it is only young men and women in the large towns that are taken into the service. If the young people of the rural districts make application they are usually told that there are no vacancies, although I know that quite a number of people were taken on just about the same time. That sort of thing is unjust towards the countryside, and I, as a representative of the countryside, must protest against the employment of young people from the towns in preference to those from the countryside. The young men of the countryside are just as much entitled to those situations as the young men of the towns. I hope that the railway administration will pursue the policy of giving an opportunity to young men from rural areas for employment in the railway service. At the moment the position constitutes a serious injustice.

I must rise to support the protest made by hon. members against the administration’s treatment of its non-European servants, who, although they had the first and most severe cut in their wages ever imposed in the name of economy, are not now getting the benefit which has been extended to the European staff. What justification was there originally for reducing the pay of the nonEuropean railway employees? The Minister and his officials know as well as I do, that in 1931 everybody was searching around to find where they could make economies. Several economies were proposed, but as the result of protest they were temporarily shelved. This reduction of non-European wages was iniquitous and unjustified, and the amount of suffering thereby caused did not warrant the hardship which individuals had to suffer as the result. Many of the sufferers had served the administration faithfully and well; large numbers of them had many years’ service to their credit, but all the same their wages were lowered from 3s. 9d. to 2s. 6d. per day. The standard of living was definitely attacked as a deliberate matter of policy. This much-vaunted civilized standard of living, which the Railway Administration had shouted from one end of the Union to the other, was made a question of colour. We who sat on the opposition benches were prepared to support any railway administration which would champion the cause of civilized wages, provided it was to be a standard of civilization for all workers, irrespective of class, creed or colour. In 1931 the Railway Administration definitely made an attack on the civilized standard of living of the non-European. We have never been told clearly what the resulting saving was to the department, but it must have been infinitesimal. I urge the present administration, working under a coalition government, to deal openly, fairly and frankly with all its non-European employees. If we are going to have a civilized standard of living, let us have it all round; do not let us have one standard for the European and another for the non-European. If so, that policy will be fought from this quarter of the House. Is the Minister acting honourably—there can be no other word for it—when he suggests that the non-Europeans should receive no consideration whatever, simply because the cut in their wages was not imposed under an Act of Parliament, when 5 to 10 per cent. was taken off every railway employee’s wages? I advise the Minister not to face Parliament next session unless, during the recess, he has made some adequate attempt to bring about a readjustment of the wage conditions of those non-Europeans who were cut so drastically in 1931. Then the European artizans who were reduced to the grade of civilized labourers are also suffering. I want an assurance from the Minister that, in the event of the railway traffic once again justifying an extension of the hours of labour, those skilled workers whose hours of labour and, consequently, the amount of their pay were reduced, will be the first to be reinstated to their old rate of wages. I want a further reassurance that if any of them were receiving the benefit of higher wages, when the restoration is made they will be returned to their old basis of wages, unless the Minister is prepared to adjust the anomalies in some other way. There are many opportunities for the Minister to employ skilled artizans. There are many houses belonging to the administration which are occupied by railway porters. To mention only one set of quarters in the Cape Town area, the breakwater and dock cottages, those cottages require a great deal of attention. They are in a state, not of actual disrepair, but they could very easily provide a lot of employment for skilled artizans in that area.

With regard to the statement of the hon. member for Salt River (Mr. Lawrence) respecting a gratuity, if the hon. member will give me the case he mentioned I will look into it. There is no intention to treat anybody unfairly.

I can give you ten or twelve cases.

I do not know that I want so many. If you have one or two where you can prove unfairness, that would be better than a larger number where that will not be possible. With regard to the question of “subbing,” I do not think that this practice is at all helpful to a staff. It has obtained in the railway, and it means that the men who “sub” are living nearer to the border line than they ever did before. With regard to the matter referred to by the hon. member for Prieska (Mr. Geldenhuys), I am afraid that we cannot do anything more in the way of reducing motor transport charges. On all sides, everybody is asking for increased facilities and a decreased tariff. It cannot be done; there is no hope of it. As to the question of the children in the country districts not having the same chances of getting into the service as the children of the towns, I think the hon. member has been misled by the fact that we are engaging fewer young people. The hon. member for Salt River also brought up the question of reduction in the number of the staff. As a matter of fact, the number in the year 1932-’33 was over-estimated, and was a larger number than were actually employed The 1933-’34 figure corrects this over-estimate. Practically all those reductions have already taken place.

In other words, you are not going in for further retrenchment.

No. As regards the question of the hon. member for Cape Town (Central) (Mr. Bowen), I have gone into the matter of the 1931 cuts, and I don’t think that it is necessary for me to repeat what I have said. There is no doubt you could employ everybody if you are prepared to run up a deficit of £1,000,000 a year, but that is not my attitude towards the railways. My object is to see that, at any rate, this year the railway revenue balances the railway expenditure.

I do not suppose the Minister can give any other reply but that which he has given, but I would like him to enquire into the question as to whether the railway administration maintain that there is to be one civilized standard for a non-European and a totally different civilized standard for a European. I would ask him to think that over. There is another question I would like him to go into during the recess. Amongst the European salaried officials there are pre-Union railway officials who, when they came in at Union, were definitely assured that their position would not be prejudiced by the fact that they were unilingual officers. Quite a number of these officers are not required to speak or work in more than one language. I was 13 years in the railway head offices, and not on one day during that time did my duties require a second official language. There are many of these officers who can speak Afrikaans, but who have no need to do so. There are many of them who will never have any need of a second official language. They perform their duties, sincerely, honestly and efficiently, and with all the ability of experienced and well tried officers. Many of these officials are being sacrificed on the altar of Afrikaans. They are suffering on account of the fact that they are unable to speak the second official language. They are prevented from advancing in the railway service. I make no claim on behalf of any person who was not in the railway service prior to the Act of Union. Subsequent to the Act of Union, any person who entered the civil service or the railway service was expected to learn a second official language, or to be able to speak it, but these old officials, if they are given promotion, are put on probation for six or 12 months, and their promotion in grade is limited to 12 months’ probation, contingent on their becoming efficient in the Afrikaans language. For what object? Certainly not in the interests of their work, because they will never be called upon to use it. Yet many of these officials go to work voluntarily before 8.30 in the morning, and I know some of them so keen about their duties that they return to their offices every night of the week, and work up to 10 o’clock or 11 o’clock at night. Their treatment with regard to the language matter is causing discontent in the minds of many of these higher officials. It has been done under an arbitrary rule, quite devoid of precedent, which has been brought in during the last three or four years, and which is entirely unjustified, because it does not tend to bring about a contented and efficient service. I ask the Minister definitely not to prejudice the advancement of his old and trusted officials to the higher posts and responsibilities for which they, and they alone, are qualified. I ask him to talk it over with his staff officers, the chief accountant and the assistant general manager, and I want him to see that these measures, which are easy enough for junior members of the staff, are not applied to the older men who are asked to learn something which they have not had an opportunity of doing—men who are close on 50 years of age, and find it difficult to learn the second language. Then I would like to know, is the head office staff still expected to put in that extra half an hour a day?

It is taken off.

That is all right, and I compliment the Minister on that, because that saving was no economy to the railway administration.

Head, as printed, put and agreed to.

Head 2, “Maintenance of Permanent Way and Works,” £2,379,778, put and agreed to.

Head 3, “Maintenance of Rolling Stock”, £3,175,015, put and agreed to.

Head 4, “Running Expenses”, £3,997,323, put and agreed to.

On Head 5, “Traffic Expenses”, £3,526,623,

I want to take up the Minister’s time just for one moment to mention a local grievance from which the inhabitants of Johannesburg suffer. I hope he will promise to look into it. It is that there is a shortage of porters on Johannesburg station. You have that wonderful new station, but if the Minister will get the actual figures, he will find it is absolutely under-staffed, so far as porters go. It has been my experience, as a member of the travelling public, and of other members of the travelling public, that on arrival there on many occasions you find it impossible to secure the services of a porter. In Cape Town, on the arrival of the long-distance trains, you find porters almost tumbling over themselves, but in Johannesburg I have found trouble in getting a porter, and often there are not three porters there. I always wonder why the administration does not increase its staff on that station, and quite a number of the unemployed could be employed in that way.

Head, as printed, put and agreed to.

Head 6, “Superannuation”, £839,640, put and agreed to.

Head 7, “Cartage Services”, £349.844, put and agreed to.

Head 8, “Depreciation”, £1,662,600, put and agreed to.

On Head 9, “Catering Service”, £373,308,

This is the last time, sir, I shall disturb the Minister on these estimates. It is merely in connection with the centralization of the catering staff at Johannesburg. I would be glad if the Minister could give the committee some details whether the change over has proved a success, and whether there is any likelihood of the administration reverting to the former system. I mention the matter, sir, because it has been the custom of the administration in former years to engage a fairly large number of casual staff locally for seasonal work, such as the Christmas season, and they are employed, as temporary stewards, some in the Houses of Parliament, and some on the trains. In view of this centralization it is feared that some of these men might be left out when men are being engaged. Last year I saw Mr. Simmons, the catering manager, and he gave me the assurance that these local men would not be overlooked. The Minister informed me that since the 1st of October, 17 casual stewards have been engaged locally, and 151 in Johannesburg. It is true that, of these 151, 38 came from Cape Town, and 18 from Durban, but even after making that allowance the majority were engaged in Johannesburg. All I ask from the Minister is this, that he should go into this matter to see whether more men from the Cape cannot be engaged. I realize the difficulties of the catering department, and there is no suggestion that the catering manager is not carrying out the assurance he gave. These men feel they have, in a sense, a vested right to be taken on here, and they hope that they may be taken on on the permanent staff later. The work is of an exacting nature, it has been well done, and these men have a claim. I have already interviewed certain heads of departments on this matter. Then I ask the Minister to take into consideraion the employment of those casual stewards at this House who expected to serve the full session, but who, in view of the two short sessions this year, are likely to be thrown out of employment again in a few days’ time. I hope these men may be absorbed and may be employed until the next session comes round, and that the administration will consider this sympathetically.

In regard to the instructions for the centralization of the catering staff, I am informed that this has worked most satisfactorily from the economic point of view, and that of control. I may remind the hon. member that the whole catering department has been a matter of great concern for some time, and, therefore, any steps that are taken to get better control and make for more economy must be helped on and encouraged, and not discouraged. I will bear in mind the point he makes in regard to the casual catering staff and I may add that they are now looking into the matter and I will also bear in mind the point regarding the stewards of the House.

Head put and agreed to.

Head 10, “Publicity, Bookstalls. Advertising and Automatic Machines”, £163,177, put and agreed to.

Head 11, “Bedding Equipment of Trains”, £41,485, put and agreed to.

Had 12. “Grain Elevators”, £231,397, put and agreed to.

Head 13, “Road Motor Services”, £389,829, put and agreed to.

Head 14, “Tourist Service”, £37,420, put and agreed to.

Head 15, “Interest on Capital”, £5,348,463, put and agreed to.

Head 16, “Interest on Superannuation and other Funds”, £892,430, put and agreed to.

Head 17, “Charges in respect of lines leased”, £13,500, put and agreed to.

Head 18, “Miscellaneous Expenditure”, £122,419, put and agreed to.

Head 19, “Contribution to Betterment Fund”, £50,000, put and agreed to.

Head 20, “Contribution to reduce deficiency in Pension and Superannuation Funds”, £287,000, put and agreed to.

Harbours.

Head 21, “Maintenance of Assets”, £226.980, put and agreed to.

Head 22, “Operating Expenses”, £239,460, put and agreed to.

Head 23, “General Charges”, £27,114, put and agreed to.

Head 24, “Superannuation”, £27,985, put and agreed to.

Head 25, “Depreciation”, £104,927, put and agreed to.

Head 26, “Lighthouses, Beacons, Bells and Signal Stations”, £44,598, put and agreed to.

Head 27, “Interest on Capital”, £621,581, put and agreed to.

Head 28, “Miscellaneous Expenditure”, £5,625, put and agreed to.

Steamships.

Head 29, “Working and Maintenance”, £97,543, put and agreed to.

Head 30, “Miscellaneous Expenditure”, £50, put and agreed to.

Capital and Betterment Works.

Head 1, “Construction of Railways”, £342.120, put and agreed to.

Head 2, “New Works on Open Lines”, £1.034,867, put and agreed to.

Head 3, “Rolling Stock”, £91,890, put and agreed to.

Head 4, “Harbours”, £114,670, put and agreed to.

Head 6, “Working Capital”, £49,673, put and agreed to.

Head 7, “Unforeseen Works (under Heads 2 to 6, inclusive)”, £72,000, put and agreed to.

Loan Estimates.

Loan Vote A, “Railways and Harbours”, £1,000,000, put and agreed to.

On Loan Vote B, “Public WoRks”, £522,500,

I want under this vote to ask the Minister a question. I do not think you will allow me to do more. In this vote the Government has not included provision for the new magistrate’s court in Johannesburg. We were promised that that would be the first major public work to be undertaken by the Government. That promise was given last year and the urgency of the work is so well known that you will at any rate allow me to ask this question.

I quite agree that this is an essential service that should be provided.

You have not answered my question.

The Minister was good enough to answer my question with regard to the Supreme Court at Pietermaritzburg. I would like to know what work is to be carried out there and the appropriate cost?

This does not appear on the estimates.

You will not allow me to discuss this matter and I will not go beyond that ruling, but I did not catch the Minister’s answer and I am sure the press did not catch it, and Johannesburg is anxiously waiting to hear about this. Did the Minister say that this was going to be done, and if so, when?

I said this was a service that should be carried out and that it was very essential. If you ask me why there is no money provided here, it is because there is none available.

Can you tell us when it is likely to be started?

You should have been here last night.

What is the position with regard to the police station at Pietermaritzburg? What about the money you are receiving for that? It should be set off against the expenditure shown on Loan Estimates.

I have not that information. I only know that the present accommodation is most inadequate and that this is very necessary.

Vote put and agreed to.

Loan Vote C, “Telegraphs and Telephones”, £400,000, put and agreed to.

On Loan Vote D, “Lands and Settlements”, £426,000,

I should like to receive some information from the Minister whether there is any money available for the purchase of land under Clause 10 of the Act. There are many cases where it will be most regrettable if people cannot be given the opportunity to buy land, because there are bywoners who are anxious to have their own plot of land. Even if an enquiry is being made by the Minister, I still hope that he will render available a small amount for the purchase of land and I hope that he will not delete all provision in this respect. I should like to know from him what the position is.

No money has been made available for the purchase of land under Clause 10 or 11 of the Act. The amount which is asked for is intended for land which has already been purchased, but which has not been paid for yet. The hon. member for Zulu land (Mr. Nicholls) asked whether we are still buying land under Clause 10 of the Act. This is only taking place under dams, where we are buying irrigable land for settlement purposes. The amount of £120,000, which is asked for, is mainly in connection with the purchase of land on the Pongola and along the Kaffir River in the Free State. The land is bought there for the purpose of allotting it to settlers who are already there. The Minister of Lands stated the other evening that he was enquiring into the whole matter, and next year he will be able to say whether further land will be purchased under Clause 11.

I want to ask the Minister what this £120,000 is for. Is this also under section 10? Are we going on with the old scheme?

Vote put and agreed to.

On Loan Vote E, “Irrigation”, £612,000,

Will the Minister please explain what the position is in regard to the Pongola irrigation scheme? You have spent £46,000 there, and you estimate spending another £120,000 this year. Have you got transfer of the land that is under this scheme. As I understand the position, based on a personal inspection of the works, yon will not come to finality until you have got transfer of the ground, and it appears to me that you are rather jeopardizing your position.

As far as the irrigation itself is concerned, I am not certain what the position is in regard to the land which will be submerged, but as far as the other land is concerned we agreed with the owners that they would abide by arbitration, and in two cases arbitration did take place. That was in the case of the two Rouillards. They would not accept the price which was offered to them, and then they agreed that there should be arbitration. The arbitrator then decided the price. They were still dissatisfied, but after having agreed to arbitration they had to accept. In one case transfer has been given, and in another it has not yet been given. Then, of course, in regard to the other land to be irrigated, I cannot say how far they have gone with the arbitration, but unless they accept the price offered by the Lands Department, the same process will have to be pursued, and the matter will have to be decided by arbitration. I do not think that there is any need for anxiety about the matter, because if these owners do not accept the price offered by the Land Department arbitration will be resorted to.

The Minister referred to Mr. Rouillard. May I remind him that when this vote was discussed a year ago, the then member for Barberton, who is now Minister of Lands, described the scheme as a “Rouillard ramp”. I wonder whether he is still of the same opinion?

I cannot say anything about that.

I notice that an amount of £14,000 has been placed on the estimates for the building of a dam in the Marico area. I wish to express my personal thanks and the thanks of my electors in that division to the Minister for that amount. We trust that the irrigation scheme will be proceeded with as soon as possible. The areas of land owned by those people are small and they are poor, and the sooner the work is started on the better.

In the absence of the Minister of Lands,

As much as I appreciate the attempts of the Minister of Native Affairs to reply to these questions, I move—

Motion put and a division called.

On the Minister of Lands taking his seat, the call for a division was withdrawn.

I would like to explain that I was in another place.

I notice that under the heading of “Water bores” under Item 2, provision is made for bores. I understand that two schemes are in force to-day in that connection. The one is that bores are supplied to the tenant or to the owner of the land if he deposits an amount of £7 10s. on making application. The other scheme is that he is given a loan of £20 provided he gets water. I wish to quote a case in order to explain to the Minister what I have in mind. There was a case where a person applied for loan to get a borehole on his farm. The amount was granted, but no water was found. The regulation laid it down that if he does not get sufficient water he cannot get the loan, but in the meantime he had to incur expense in connection with boring. I want to ask whether the department cannot do away with that deposit of £7 10s. In my constituency, especially, the farmers are very much in need of boreholes on their farms, but they find that they are hardly able to get a bore. They have to trek from one borehole to the other. I shall be very pleased if the Minister can give his attention to the question of boring.

Can the Minister please tell us what is the position in regard to the ground which will be irrigated by the Pongola dam? When we discussed the scheme a year ago the hon. member for Barberton (Col. D. Reitz) described the scheme as a “Rouillard ramp.” Can he tell us what is now the opinion on this scheme of the present Minister of Irrigation?

In answer to the hon. member I would like to state what is the position of the Pongola scheme at the present time. The dam is in the process of construction, but only two options to purchase ground have been acquired. I think it would have been wiser if we had got the options before starting to build the dam, and I do not know how the matter is to be unravelled. We shall have to try to negotiate with the owners, and go to arbitration. In one case, that of Mr. Rouillard, there has been arbitration, but how we are to force the other owners to arbitrate, I do not know.

And what about the “ramp”?

One very often uses words in the heat of the moment. I am going to Pongola myself to investigate the scheme during the recess and would prefer not to express an opinion on it until I have been there; to be frank, I do not know very much about it, and I shall not be able to obtain the necessary information until I go there. If the hon. member for Kingwilliams- town (Mr. Baines) will repeat his question next session, I hope to be able to give some satisfactory information.

†*As regards the question put by the hon. member for Potgietersrust (the Rev. S. W. Naudé) I want to say that I replied to that the other day. I cannot possibly give bores free of charge to everybody. If we were to do that we would find large numbers of farmers asking for bores and not requiring them, with the result that the others who urgently needed bores would suffer. We have already reduced the deposit from £25 to £7 10s., and I am not in favour of further reducing it, because as it is the Government is bearing practically fifty per cent. of the costs of boreholes. The least we can demand is that the deposit of £7 10s. shall be paid. The difficulty lies here that people do not bore during the rainy season, but as soon as the rain stops everybody wants to bore. It is impossible, however, for the Government to give bores to everybody during a crisis like the present one. At the moment there are about 88 bores in the country and they are working practically day and night. We meet the farmers as much as we possibly can in this respect.

I should like to know from the Minister which schemes are comprised in this amount of £30,000. You will find it on page 10 of the Irrigation Loans and I should like to know which schemes the money is intended for.

I cannot supply that information as the money is in respect of matters which still have to come. Small amounts are always required for all kinds of irrigation schemes and we always have to make provision for unforeseen expenditure. It is for that reason that this amount of £30,000 has been placed on the estimates.

Vote, as printed, put and agreed to.

Loan Vote F, “Local Works and Loans”, £1,960,100, put and agreed to.

Loan Vote G, “Land and Agricultural Bank”, £4.000,000, put and agreed to.

Loan Vote H, “Forestry”, £412,000, put and agreed to.

Loan Vote J, “Native Affairs”, £16,900, put and agreed to.

Loan Vote K, “Agriculture”, £650,000, put and agreed to.

On Loan Vote L, “Labour”, £750,000,

I think that the House and the country will be very pleased to see that the amount on the estimates has been increased by £81,000, although I doubt whether that amount will be sufficient to meet the needs of the country. There is one point which I wish to bring to the notice of the Minister: that is that when a district is asking for the allotment of a larger subsidy for work, the department says: “You got so much, and that is the quota for your district”. The number of unemployed in a district is not taken into account, and it does not help a great deal if you have 1,000 unemployed and only 250 get work, so that 750 remain unemployed. I should like the Minister and his department to go into the needs of every district and I should like to see provision made in accordance with such needs. I am further of opinion that the expenditure should take place in accordance with the requirements of every district. It is not always desirable to say that a definite amount is made available for a district, and that that money must be used for the construction of roads. As regards my district, it would be better to use a few thousand pounds of this money for irrigation purposes. In my district this would not merely solve unemployment to a certain extent, but it would also improve the position of the district. In the past my district was one of the good districts with plenty of water, but the water became less and less so that to-day we have no permanent streams left. If an amount is made available so that it can also be utilized for irrigation purposes, the small landowners will be put back on the land, it will have the effect of providing work for the unemployed in the district, and the district will again become an irrigation district. I want to ask the Minister whether he is able to meet us in that respect. If dams could be constructed with the aid of that money a twofold object would be achieved, viz., to give work to people and to irrigate the lands.

I should like to say a few words about unemployment particularly in the rural areas. It is not quite clear to me yet what the Minister of Labour is going to do in regard to supplying work to unemployed in the rural villages. Only a few days ago I received a large number of petitions from those people which I have submitted to the department and I can assure you that these people are becoming desperate. We see that railway lines and other undertakings are started in the larger towns, as a result of which numerous people secure employment in the towns, but in the rural dorps there is no work available on which those people can be employed. What has to become of our unemployed in the small villages? I should like the Minister to tell us what we have to tell those people when we return to our constituencies, in what way are they to secure work. I do not wish to suggest any scheme at this stage because I shall not be allowed to do so, but I want to inform the department how employment can be given to those people in my district. I want to tell the House that we cannot go back to the unemployed in the villages before we have received a statement from the Minister in regard to what is going to be done for our people. In addition to the ordinary unemployed, we have in the dorps a class of farmer who has gone under on his farm, who has drifted to the villages and is now looking for work there. Another class consists of the tradesmen, such as skilled masons and carpenters, and they are also experiencing great difficulty in finding employment. Furthermore, we have the unskilled labourers, the ordinary casual labourers, who are in great misery. At one time those people were able to secure some part of the work on the roads and streets, but municipal funds for works of that kind are practically exhausted and those people have had to be discharged. What is there left for those people, what can they do? We have to look after this, and it is our bounden duty to prevent their starving with their families. I want the Minister to tell us clearly what we have to do to find work for those people, to tell us clearly in which direction we have to go, and where we have to apply to see that at any rate work is given to a certain number of those people.

I took no part in the debate on unemployment, but I must say that I am glad to notice that such a large sum as £730,000 has been placed on the vote for unemployment. A great deal of criticism has been forthcoming in regard to the Government’s policy on the subject of unemployment, but I want to associate myself with what has been said by the hon. member for Ladybrand (Mr. Swart). In the towns there are great difficulties in consequence of unemployment, but they can take those people away and give them work on schemes where they are at any rate able temporarily to make a living. Then we have the countryside with its conditions such as were explained by the hon. member for Ladybrand, there we find the people who come in from the outlying districts looking for work. Those people drift to the towns and once they are there they are in a desperate position, while at the same time they are aggravating the problem of unemployment in the towns. On the subject of providing work we are first of all concerned with the Minister of Labour, next with the provincial administration and the local bodies. We are sent from the one to the other. That, however, does not cause me to despair. What worries me are the amounts which we have to vote for unemployment every year. This year we are voting this large amount and last year we voted £600,000. That is a burden which we are placing on posterity and we must see to it that we leave them an asset as a result of that expenditure so that in the future they will be able to pay that debt. If we spend the money on roads we find that the wind blows the surface away, and that the people who are paid off at the end of the month are no better off when they have finished the food which they have bought, than they were at the start. Those people drift to the towns. I am consequently of the opinion that the Government should spend a larger portion of that money on dams. There are rivers with permanent water which can be dammed while to-day their waters run into the sea. There are also rivers in the unhealthy and bushy parts of the country. That part of the world should be changed, and I consider that it would be better for the State to use the hundreds of young men who are working on the roads to build those dams and to clear the ground. If we do that, we shall leave an asset to posterity for the money which we are spending now. I should like the Minister of Labour to tell us whether it is not possible for the Government to pursue a different course. Do not push us about between the town councils, the province and the department. We are achieving nothing, and this great problem remains unsolved.

I notice that an amount of £20,000 appears on the estimates in connection with an irrigation scheme at Boegoeberg. I am under the impression that the Minister is familiar with conditions there and I want to ask him to make better provision for housing. The water bailiffs live with their families in small, corrugated iron houses with two rooms with the result that the wives of the men there have to do their cooking outside in the wind and dust. It would not cost a great deal of money to add another room in which they can cook. Those people are suffering great hardships and I regard it as my duty to ask that better housing facilities shall be provided for. It will only cost about £15 or £20 to build an extra room, and it will help those people a great deal.

I was under the impression that we had fully discussed all these matters on the Labour Vote on the main estimates. Members are again referring to all these questions, and it is quite impossible for me again to cover all the ground. The hon. member for Marico (Mr. Pienaar) referred here to quotas allotted to the various districts. Those quotas do not relate to the money but only to the number of people available for the work. The provincial administration can only take a certain number, and cannot take them all and for that reason the system of quotas has been adopted. We are in earnest in our endeavours to provide work for those people on irrigation works, and we prefer to give them work there rather than put them on roads, as I said during the discussion of the main estimates. The hon. member for Ladybrand (Mr. Swart) referred to the position of the unemployed in the small dorps. I stated before that we could only do the work through the local bodies. If the smaller dorps are not able to start schemes out of their own funds they can secure a loan on easy terms from the Treasury for that purpose. As I have stated before, we have placed £200,000 on the estimates for that purpose.

Do you not pay a subsidy in addition?

So long as we have unemployment and so long as Parliament votes money under this heading for that purpose, we shall continue doing that.

Is that all that is done, only through local bodies?

That is all that can be done in the small dorps. The Minister of Agriculture will also carry on with the scheme to combat soil erosion, as has been explained, and there will also be other schemes.

The people outside are not considered in regard to the large relief works.

They are also employed in railway construction work and so on.

They have very little chance with the workers in the larger dorps.

The difficulty is to find sufficient work. I want to tell the hon. member for Prieska (Mr. Geldenhuys) that the work at Boegoeberg is nearly complete. The settlement there falls under the Department of Irrigation and he must mention the case, which he referred to, under that vote as it falls under the control of that department.

I cannot allow the Minister to make a statement of that kind. I made enquiries and I found, when I approached the Department of Irrigation, that they considered that the matter fell under the Department of Labour. It appears to me that the departments are so complicated that they themselves do not know who has control of these matters. That sort of thing places a representative of a constituency in a very difficult position. There is, however, always a certain amount of saving on such a large amount, and the expense of an additional room is so small that the Minister can give his attention to the matter.

Yes, I shall do so.

I should like to draw the Minister’s attention to the position of the Free State. As the Minister knows, that province finds itself in a very difficult position. It receives a subsidy for a large number of whites, and it has landed itself in the position that it can no longer come out on the 4s. per man per day. There are no funds for the purchase of machinery. The Free State is in a position which is peculiar to itself. There are no divisional councils which have the power of levying taxation in order to provide money in that way and they are entirely dependent on the municipalities which from time to time vote money for unemployment. The municipalities, however, are getting exhausted owing to the length of the depression. So far as I can see, there is no large scheme available at the moment for unemployment. Under the Irrigation Vote there are a few items in regard to schemes for unemployed, but all those schemes are in other provinces. I should like the Minister to go out of his way to tackle some large scheme in the Free State to provide work for the unemployed there.

I want to ask the Minister in connection with the relief works at Oudtshoorn to urge the provincial administration to meet the divisional council there. I wish to thank the Minister most heartily for his willingness to help in regard to the wages that are paid there to people who are engaged on the work in Meiringspoort. The divisional council, however, finds that the work is so expensive that it is impossible for it to carry on unless further help is forthcoming for the purchase of the necessary material. If the divisional council is not given that assistance it will have to stop the work. I hope that the Minister will ask the provincial administration to contribute their share because the work at Meiringspoort is a national work and the divisional council cannot do it on its own. I hope that some concentrated effort will be made to get that work done so as to get all the unemployed from the surrounding districts there. But I trust the Minister will see to it that the work is continued so that those people may be employed. I wish to bring another matter to the notice of the Minister, in connection with people who are sent to Roberts Heights to join the service battalion of the Minister of Defence. I hope that he, as Minister of Labour, will see that justice is done to all districts. Fifteen hundred young men are employed there, and according to the figures, every constituency should be able to send ten of its young men. I am now asking that Oudtshoorn will receive its quota and will be allowed to send ten men. We have many young men there with a good education, men who are highly suitable for the purpose, who will receive a great deal of assistance through being employed there. I, therefore, ask the Minister to see to it that the people who are recruited will be taken proportionately from all the districts.

I regret that I have to express the keenest dissatisfaction with the methods of the Government in dealing with unemployment. It seems to me the Government is resolving to establish, in fact, has already established, relief work as an integral part of our national life. I well remember in the years when another pact was formed—many years ago now—it was stated most definitely that the policy of the then Government was not going to be one of relief, but to find employment at good rates of pay on work which required to be done; in short, to establish a work-a-day world in South Africa. I think the Minister will agree I am correct.

We are looking forward to that.

There is a distance beyond which one cannot see—that is where you are bounded by the horizon, where earth and sky meet; what my hon. friend says, means on the horizon. When you get up on the hilltop there is still another skyline, unfortunately, and it is that I am protesting against. The Minister is stereotyping this method of dealing with the question. It is abortive, it is a failure, it is making things worse, rather than better. The administration, too, is making things worse. Tn the first place, the Government has definitely set the standard at a very low level. Under this amount of £750,000, the Minister proposes, I presume, to carry out the policy that has obtained for several years of giving subsidies to municipalities and others of a certain amount, the difference between what they are pleased to call the native rate of pay, and what the Government is now pleased to call a standard white rate of pay for unskilled workers. That is fixed at 6s. I have heard that this already low level is to be reduced, and has already been reduced to 5s. in certain places. Now 6s. is too low a rate of pay to set down. Another aspect is that by subsidizing the municipalities, allowing and in fact encouraging them to do necessary development work that they would have to do sooner or later, you are encouraging them to do this with cheap labour, and with what they call relief labour. I protest against this miserable rate of pay the Government is insisting upon. I object to the municipalities using the unfortunate opportunities presented to them to get their work done cheaply, and not in the best possible way, and I object to this constant waste of money year after year of anything from £650,000 to £750,000. Remember that this is under a loan vote; it is not even coming out of revenue. It carries interest, and is helping to pile up the interest debt. It is helping to make the general burden of the country infinitely greater. These people are living from hand to mouth, and you are not lifting them out of their despondency. You are stereotyping a miserably low standard of living which reflects no credit on the Government. We will have to pass this vote now. We shall have to put some bread in the mouths of some men, women and children. I realize that, but I want to urge upon the Minister that he and his colleagues should try and devise a policy which will make for a more settled outlook on our national method of work, and for the upliftment of the standard of living of all our people.

I only want to ask the Minister whether he has received the report of the Carnegie Commission, and whether the Government has considered all the recommendations contained in that report in regard to poor whites, and if he has done so, I want to know if the Government can give us some idea as to what it is going to do in connection with the matter.

That matter has nothing to do with this vote.

We are dealing with the Labour Vote, and the Carnegie report makes certain recommendations as to how unemployed people can be helped.

That matter must be discussed under a different vote.

Vote put and agreed to.

On Loan Vote M, “Farmers’ Special Relief,” £80,000,

I merely want to ask for some explanation. I notice that £80,000 is to be voted here for special relief to farmers. How are we to explain the subsidiary figures in that connection? I notice that an amount of £2,180,000 was voted last year, and that only £1,737,000 was paid out. Why is it expected that only £80,000 can be paid out, and that £1,657,000 will revert in reduction of that amount?

I am sorry that I again have to raise a matter in regard to the statement made by hon. members that I must not set up one province against the other. I again wish to point out, and to give illustrations of the facts that the northern provinces are always receiving greater privileges than the Cape. According to the Act providing for special relief to farmers, we see that the Free State, with a population of 216,000 whites, received £1,523,000, while the Cape Province, with a population of 738,000 whites, received £1,208,000. I want to point out to the House that no individual, making application, could receive more than £1,000; consequently a great many more loans were allowed in the Free State than in the Cape Province. It may be said that loans could not be granted unless they were applied for, but may I be allowed to point out that particularly in the north-western areas, numerous applications were refused. In many instances the applications for loans were apparently out of order and the applications were not merely regarded as being unsatisfactory, but it also took a tremendously long time to consider those applications. This is most unsatisfactory. I know of many instances where it took more than a year, and I also know of an instance where the application was granted and where an assurance was given to the bondholder that a bond would be repaid, while, a little later on, a letter was received that it could not be done. That sort of thing is unjust towards the Cape Province. I consider that Ministers who live in the north should not act so detrimentally towards the Cape Province, but that they should act justly, and that the money, which is voted for general purposes, and particularly for farming, should be distributed equally among the provinces according to the population.

I have allowed the hon. member to go fairly fully into this matter, but I must ask him now to confine himself to the vote.

Will you allow me to reply in a few words to the hon. member for Prieska (Mr. Geldenhuys)?

Order, the Minister can reply.

The only answer I can make to the hon. member for Prieska (Mr. Geldenhuys) is this, that this vote was intended for the relief of needy farmers. It was not intended to be divided between the provinces on the basis of population; it was intended for farmers to help them to meet their obligations in circumstances that came within the provisions of the law, irrespective of whether they were in the Cape, the Transvaal, or anywhere else. I cannot believe that.it would be administered in a way which would put the Cape to a disadvantage as compared with the others. If the hon. member can bring me cases of applications unjustly reviewed, I should be glad to go into them. Then there is the point raised by the hon. member for Bethlehem (Mr. R. A. T. van der Merwe). I want to explain to him why this vote of £80,000 is there. Under the Act all applications had to be made by the 31st March, 1932. But towards the end of the last financial year the special relief board informed the Minister that unavoidable delays had taken place with a certain number of applications and they asked that they should be allowed to make payment in those cases during the present financial year so that part of the money voted last year should be re-voted this year. That is the £80,000. I can only tell the hon. member that of the £5,000,000 which it was originally intended to use, the amount issued up to the end of March last was £4,000,000.

Vote put and agreed to.

On Loan Vote N, “Fishing Harbours”, £16,000,

I wish to express my thanks to the Government for this amount which is placed on the vote for the development of fishing harbours. I should like to hear from the Minister where he thinks this money will be spent, and I should like to know how much of that money will be spent along the west coast.

I wish to associate myself with the hon. member for Moorreesburg (Mr. Erasmus), and I hope the Minister will explain to the House where this amount will be spent. The hon. member for Moorreesburg would undoubtedly like it to be spent in the Cape, whereas I would like a certain portion to be spent on the Natal coast. Last year a smaller amount appeared in the Loan Votes, but we got nothing out of it in Natal. I would like an assurance from the Minister that a certain amount will be spent on the small fishing harbours on the Natal coast.

This amount will be allocated later on. I have just put down the amount as a whole. All this money will be used for the smaller fishing harbours.

Where are you starting?

All over. The money will have to be allocated later.

I am not quite clear on this point. Last year only one-quarter of the amount that was available was used, and I should like to know whether the full amount will be used this year.

Yes, the amount will probably be spent this year. Last year we were still engaged on survey work and that is the reason why the money was not spent, but I imagine that we shall be able to do so this year.

Vote put and agreed to.

Loan Vote O, “Iron and Steel Industry”, £1,658,000, put and agreed to.

On Loan Vote P, “Withdrawal of Silver Coin”, £500,000,

Why are we doing this out of Loan Funds? I want to know whether this is an actual loss to the State or what is the position. Are we losing the whole of this £500,000?

No, it is not a loss to the State. Representations were made to the Treasury by the banks that they were overstocked with silver coinage largely owing to importations of silver coin from overseas. The Treasury has taken that amount of silver off their hands, but it will be used so that it will not be lost. On the other hand, we are recouped to a certain extent in this way, because, from the 1st April last, the British Government over three years will allow £100.000 worth of British silver to be shipped from here to the United Kingdom. After that the position may again be reviewed. In any case we shall be reimbursed to the extent of £300,000 out of this money and it is expected that the agreement will continue as long as we have British silver here.

Vote put and agreed to.

Estimates of Expenditure from the Consolidated Revenue Fund to be reported without amendment.

Estimates of Expenditure from Railway and Harbour Funds to be reported without amendment.

Estimates on Capital and Betterment Works, South African Railways, to be reported without amendment.

Estimates of Expenditure from Loan Funds to be reported, without amendment.

House Resumed:

The Deputy-Chairman brought up report of Committee of Supplies reporting the Estimates of Expenditure from the Consolidated Revenue Fund without amendment, the Estimates of Expenditure from Railway and Harbour Funds without amendment, the Estimates on Capital and Betterment Works, South African Railways, without amendment, and the Estimates of Expenditure from Loan Funds without amendment.

Report considered and agreed to and two Bills brought up.

I move—

The object of this Bill has been prominently before members and I do not think that I need spend much time in discussing the general principles. They are well understood and have been before hon. members for some time. It is necessary to deal with some of the more important provisions of the Bill. The object of the measure is to provide subsidies towards the payment of interest on farm mortgage bonds. The general idea of the Bill is that the rate of interest on farm mortgage bonds should be recognized at 5 per cent., the farmer to pay 3½ per cent., and the Treasury 1½ per cent. The important point first to be discussed is what is a farm mortgage bond? That is defined in Clause 1, as follows—

1. (a) A mortgage bond registered in a deeds registry whereby any farm is specially hypothecated, or (b) a general bond registered in a deeds registry any debtor whereunder is a farmer, or (c) a notarial bond to which the Notarial Bonds (Natal) Act 1932 (Act No. 18 of 1932) is applicable, any debtor whereunder is a farmer, or (d) a charge on any farm whereby is secured an advance made by the Land and Agricultural Bank of South Africa under any law relating to fencing, dipping tanks, silos or water supply.

But it does not include any bond which was created on or after April 1st last. The point is this—that the bond must be secured, on land which is occupied by a farmer. A farmer is defined as “any person who, in the opinion of the Minister, normally derives his sole or principal means of livelihood from farming carried on by him.” All sorts of questions can be raised whether a man occupying land and possibly carrying on or supervising agricultural operations is a farmer. He may be carrying on some other occupation, and his farming may be a side line, and in case of difficulty, the definition of the Minister must be obtained.

If a man has an income from other sources and not from his farm, what happens then?

It will have to be decided where he normally derives his principal means of livelihood. Hundreds of conundrums could be raised, and it is a point on which no general definition can be laid down; that is a point which the Minister will have to decide, and I hope it will be some other Minister than myself. The bond must have been created before April I last. First of all, if it “has been passed to replace or redeem a bond under which the same person is debtor and which, in the case of a bond, referred to in paragraph (a) or (b) was registered before the first day of April, 1933, and in the case of a bond referred to in paragraph (c), was passed before the 1st day of April, 1933, or by such charge is secured any advance made by the Land and Agricultural Bank of South Africa which on the 31st day of March, 1933, was secured by a charge over the same farm, in favour of that bank; or such bond has been passed to secure a debt incurred before the 1st day of April, 1933, and pursuant to a written undertaking entered into before that date to pass such bond.” That is to say, supposing there was a deed of sale under which a purchaser undertook to pass a bond for the price, if that deed of sale was entered into before April 1 last, the bond would come under this Bill. Then we come to certain special provisions in regard to mortgage charges. It is laid down that whenever under any farm mortgage two or more persons are jointly bound as debtors, of whom one or some but not all are farmers; or a partnership is bound as a debtor, one or some but not all of the members of which are farmers, the whole or a defined portion only or no portion of the interest due or paid under that mortgage as the Minister in his discretion may determine, shall be deemed to be interest due or paid under a farm mortgage. The next clause deals with the question of the payment of the subsidy towards the interest due or paid under a farm mortgage. The Minister is authorized, from the amount voted by this House, to provide a subsidy towards the payment of interest on farm mortgages, and that subsidy is to be equal to the amount of the interest due. Clause 3 deals in detail as to how this amount is to be divided. Clause 4 deals with the application for the payment of subsidies. The applicant for a subsidy has to show that his mortgage is a farm mortgage, and that he has paid interest on it of not less than 3½ per cent. The farmer will have to prove this; in order that the subsidy may be available. Clause 6 is concerned with this much-discussed question of the taxation on interest of over 5 per cent. on a farm mortgage bond. Hon. members have already had means of discussing that on the motion to go into Committee of Ways and Means, so that I need only repeat that the purpose of the clause is to carry out the resolution already arrived at, and to tax to the fullest extent the interest paid on farm mortgage bonds in excess of 5 per cent., the balance being appropriated by the State, and it can be refunded at the discretion of the Minister to the farmer who originally paid it. Clause 9 is a very important one, and has caused very great difficulties. Hon. members know that it has been the custom of trust companies and boards of executors to receive deposits from the public. In the past they have received these deposits at a comparatively high rate of interest. The companies invest these deposits in farm or other bonds; the money was taken on deposit by the trust companies or boards of executors and invested in bonds, but not in the names of the depositors. The business, of course, is one which is generally regarded as somewhat risky because you take deposits from the public on a comparatively short term, and you invest them in investments which are of a comparatively long term, and every now and then comes the difficulty of finding liquid cash resources in order to pay out depositors on demand. The difficulty which arises is that in certain cases they have promised these depositors interest at the rate of over 5 per cent. per annum, while the rate of interest on farm mortgage bonds is going to be reduced in practice to 5 per cent. They are in the difficulty that they will receive 5 per cent., while they are liable to depositors very often for more than 5 per cent. In one case, the Bloemfontein Board of Executors, if nothing is done to remedy that, they will be in a very serious position. I understand that they pay their depositors 6½ per cent., and they will, of course, be limited to 5 per cent. on farm mortgages. It was suggested that this Parliament should pass an Act limiting the rate of interest paid to depositors by these trust companies to a flat rate of 5 per cent., but that was considered to be inequitable. These companies lend not only on farm mortgages, where they are limited to 5 per cent., but also on other mortgages where there will be no such limitation, and they will therefore not be entirely limited to 5 per cent. bearing mortgages. Another consideration is that it is in their power, and in their own interests they must exercise that power, to bring down the rate of interest they pay to their depositors to a rate which they can reasonably hope to get from their investments. In their own interests they must reduce their rate of interest to their depositors. The Government has felt at any rate that some relief must be provided for them in the interests of the very large section of the public who have deposited their money with these companies. What is proposed is that the Minister may authorize any such company to reduce the rates of interest in excess of 5 per cent. per annum which the company has undertaken to pay in respect of the monies received on loan or deposit to a rate to be determined by the Minister: and in determining the extent to which such reduction can be made, the Minister shall have due regard to the proportion which the aggregate of the monies received by the company on loan or deposit bears to the total amount invested by the company in farm mortgages, where the interest is limited, and the extent of the other investments where the interest is not limited. The Minister, having due regard to that proportion will decide to what extent he is to authorize the company to reduce the rate of interest, but in no case is the rate of interest to be reduced to a lower rate than 5 per cent. per annum. The section indemnifies any company who fails to pay interest over the rate of 5 per cent. against any claim by any person in respect of such reduction. That is one of the most difficult clauses connected with this Bill, and I hope that the solution which is offered here will meet with acceptance as being the only practical solution within reasonable bounds which can be adopted. Clause 11 deals with the addition to capital of interest due under farm mortgage, and the provision there is that interest will be added to the capital to the extent to which the creditor and the debtor agree, and the addition can be registered in the Deeds Registry in the simplest possible way, without the payment of unnecessary fees. But it is limited to this, that no interest can be added to capital other than interest in respect of the period from the beginning of the conventional year of the farm mortgage within which the 3Îst day of March, 1933, fell, up to and including that date, and interest in respect of the conventional year preceding the said period, unless there is no subsequent mortgage. I do not think there is any other provision in this Bill which I need mention, but in any case, I think it better that hon. members should raise points which occur to them in dealing with this measure, so that they can be dealt with when I reply. There are certain points which have got to be considered, and in respect of one or two amendments will be put on the paper.

I think that the Government deserves a good deal of thanks from the farming community for their efforts to assist the farmers. I have very grave doubts, however, whether they are effecting by means of this Bill, quite what they are striving to do. I am not so sure that this Bill will help the farmers to the extent that is expected. I am rather afraid that in many respects it may leave the farmers in a worse position. I am afraid that the farmers will not be able to raise a bond anywhere except from the Land Bank after this, and we cannot visualize the position that the Land Bank will be able to carry all the farmers in the country. What I am afraid of is that lenders will call up their bonds, almost wholesale. I hear that there were scare headlines in one of the papers this morning. I want to say at once that I have not seen them, but a week ago two bondholders called up £25,000 in my district, while I know of two other bondholders who are sure to call up an amount which will be almost as large. There must be another £50.000 that I do not know of in the one district. Then you have not yet touched the smaller bonds that have to be called up. I hope it is realized that in hundreds of cases the moneylenders are really poorer than the persons to whom the money has been lent, and widows, spinsters, and some old people lent money at 6 or 7 per cent., and some have been lucky enough to get 8 per cent., and they will be in want if they have to live on 5 per cent. There will be no question about it. These bonds will have to be called up.

What will they do with their money?

That is a very poor argument, and a negative argument. A man will say “give me my money in my hand.” I do not know whether hon. members realize the psychology of the bondholder? I think it is fair to say that a bondholder does not want to have any worry about his bonds, and if his interest is not paid he will call the bond up. My fear and trouble is that a sum of £4,000,000 will not see us anywhere in this case. It seems to me it will be nearer £20,000,000, when the Land Bank take it up. You may say to me: “What are you going to do about it?” I would suggest, even at this late stage, that the Minister take into consideration putting a little gilt on this pill. I suggest that the Minister, even now, takes into very serious consideration, saying to bondholders: “All right; we will exempt from income tax and super tax all interest on farm bonds.” I believe the effect of this will be that as to many of your large bondholders a few million pounds will not be called up. It is a fair proposition. I have a letter, which I would like to read to the House, which was written to me before the Government’s proposals came out. It is as follows—

Now I say I think you will achieve a good deal, and who knows how much you will achieve by saying to bondholders that the Government is reasonable, and is going, at any rate, part of the way, and will consider very seriously exempting income tax on farmers’ loans. I seriously advise the Minister even at this late stage to consider this question. I do not want to go into all the details of the Bill. I am afraid it has been drawn, perhaps, without too much knowledge of the practical circumstances. The Bill defines what a farmer is—

There are many people who fall under that category who are not farmers, although they are owners of farms. Here is a farmer to whom you can give assistance and who gets the benefit of 1½ per cent. interest. We may not ask the Government for that assistance, but we ask why include our bonds in this? If your bond is not considered a farm bond you will have no complaint. If the Government leaves my bond—

What do you mean by “my bond”?

If the Government says “all right, you have bonded your property; we do not care whether you pay 10 per cent. or 5 per cent.”—we are not asking the Government’s assistance. Do not ask bondholders to call up their bonds, or induce them to do so, and then say “We cannot help you.” If a man is not a farmer, do not call his bond a farm bond. There are many snags in this Bill, and I do not want to keep the House by pointing them out. I will vote for the second reading, however.

The hon. member who has just sat down has drawn attention to a facet of the local situation, which I had hoped the Minister would have referred to in his speech— that panic has spread to the country as to the actual meaning and effect of this measure. The information of the hon. member for Ermelo (Col.-Cdt. Collins) as to bonds being called up corresponds to information which I have myself and probably other members in this House, too; and it is, that in consequence of the discussions which have taken place here a feeling of insecurity has set in, which in some cases has resulted in the unwarrantable calling in of bonds. What is wanted is not, as he hinted, more money, but a restoration of confidence— more confidence. I thought the Minister should have emphasized what I want to emphasize in an amendment I wish to move in committee, and that is, that this is a temporary measure, to operate from the 1st April in this year to the 31st. March next year, and if, coupled with that, an appeal had been made to creditors to extend the good offices they have extended to mortgagors during the past two or three years, that would go a long way to meet the case. And at all costs we must try to avoid calling up a large number of mortgage bonds. For that, with the funds at its disposal, the Government could not make provision and it may bring about a state of affairs worse than that which obtains at the present time. I hope anything I may say will not, in any way, tend to aggravate that feeling of insecurity or to re-echo what has been said in this House in the course of the last three weeks, very much to the detriment of the farming industry, namely, that the whole of that industry is in a state of poverty or is approaching very closely to bankruptcy which does not, in any way, fit in with the real position of the country. One feature of this Bill which does strike one is the large number of points proposed to be left to the administrative discretion of the Minister himself. He himself indicated that he would be glad to escape from that task. For our part I do wish to say that although one recognizes that the time available to the Government may not have made it possible for them to frame a more precise Bill, I do not think that by approving of a Bill of this kind which regulates private rights, we should be understood to depart from the point of view we have expressed so often, that our legislation should not create more administrative law. I cannot conceive, unless he proposes to introduce some provision to delegate his projected functions, how he or his successor can properly exercise those functions. Let me come to a point which is not dealt with by the Bill and that is the absence of a means test. I cannot understand why this Bill should be drawn in such a way that where help is not really required, the State should step in to provide it. Under this Bill if the nett income of a farmer were, say, £2,000, he would still be eligible to demand help in respect of the mortgages which he may have passed upon his property. It is obvious that this is hardly a justifiable system of legislation, and I hope to put forward an amendment by which this can be discussed much more fully. It does not seem to be impossible in a case where the taxable amount of income of a farmer is not less than £300 per annum, to provide that such a person shall not be entitled to relief at the hands of the State. Another point not sufficiently clearly emphasized in this Bill is the emergency character of this legislation. I would like to see the Minister insert something quite definitely in the Bill, and I hope to move an amendment whereby it will be made clear that this Bill will require legislative renewal from year to year. I am thinking of the interest of the debtor as well as the creditor. When mortgagees realize that this is an emergency measure they will not be too prone to step in to demand their capital, and from the point of view of the debtor, if he is able to make an appeal to his creditor for assistance, pointing out that a rise of prices is coming—as I believe, soon—he should be allowed to remain a debtor under the bond, then the confidence of the creditor would be retained and we would do away with one of the great dangers of this legislation, that is the indiscriminate calling up of bonds. I suppose every member has come across cases where the mortgagee is far more poverty-stricken than the debtor under the bond. A host of cases can be cited to show the inequity of the position resulting from this Bill, where a mortgagor is in a perfectly sound position but his mortgagee is perhaps by its terms, reduced to a lower standard of living. I think it would be possible by an amendment to put this point in a form in which it can be discussed, but I do feel that it would not be reasonable for this House to pass a measure which, although desiring to help generally one section of the people in certain cases, can be shown to create extraordinary hardships in the other type of case of which I have spoken. Then I think it should be possible to introduce an amendment whereby the mortgagor and the mortgagee can agree to contract out of sections 6 and 7. Under that section any interest paid in excess of five per cent. can be recovered by the State from the creditor and paid over to the debtor. There may be many cases where creditors, however anxious they may be to show leniency, may be compelled to call up their bonds. If they are unable to live on the reduced interest they may, as I add in reply to the interjection just put to me, have to utilize a portion of the capital for that purpose. In such a case, the bond must be called up by the creditor, however anxious he may be to assist his debtor. In turn, the debtor must find funds. When the £4,000,000 on the estimates is exhausted, as I think it soon will be, where can the necessary money be raised, for undoubtedly the effect of this legislation is going to damage the farmers’ credit. Until investors feel that the sanctity of contracts is to be respected by this House, there will be a general tendency to fight shy of farm investments. What is the debtor to do then? He should be left in a position to say to his creditor, that he is prepared to continue paying what he had always paid. The debtor may owe a debt which is equal to possibly 90 per cent. of the present value of his property, and yet be able to carry on, but if Parliament is going to impose this tax, the mortgagee cannot live upon his reduced income. In a case like that, all that would be required would be that where the mortgagor was prepared to continue paying that rate of interest, the Minister should have the right to be able to say that the excess should not be appropriated by the State. And if in a case like that the mortgagor waived his right to apply to the Minister under section 7, you would have a simple method of contracting out of this particular clause. Unless the Minister is prepared to take the responsibility and will give the assurance that all such eventualities will be provided for, he should not interfere with the right between mortgagor and mortgagee to contract out of the Act. Another point which is omitted from the Bill is this. Where the State chooses to interfere with a fixed term contract, i.e., a bond which may have been fixed for five or ten years, and then reduces the rate of interest, the creditor should have the right to call up that bond even though the term is fixed. And finally I say that as the clause is drawn, if the intention of the Minister is to throw the responsibility on the creditors of collecting the per cent. contribution upon their bonds direct from the State, then I feel that he has taken a step which is not warranted and which can be objected to on simple and sound grounds of business expediency. In the first place, where a debtor has paid 3½ per cent., and the creditor is left to recover 1 per cent. from the State—the State, by the way, was never his debtor, and the relations between him and the State are governed entirely by the few short words contained in the section—what will be his position if the debtor should become insolvent, or should die? It might be argued that in the case of insolvency, the 1½ per cent. would not belong to the creditor. This clause opens the door to a great many unnecessary complications. Apart from accidents of that kind which will occur in circumstances such as we are providing for, you have the further point that to place the obligation on the creditor will mean much delay and expense. I would quote one case to illustrate the difficulties which may occur. Let me picture an institution with in vestments in, say, 30 or 40 districts. I can mention cases where the number of districts concerned will be very much greater, and if 3½ per cent. is paid by the mortgagor, and then the creditor is left to recover the 1½ per cent. from the State, on him is thrown the onus of proving that the debtor is a farmer. It may mean an expensive enquiry, and forms will be prescribed which will have to be filled in by the debtor, who may live far away in the country, and who may have lost all interest in endeavouring to help his creditor. The margin of profit left to the creditor is not sufficiently large to cover the cost to him of all this work. The solution is so simple. Allow the debtor to pay his 5 per cent. and immediately to make his application. It could be done by arrangement with the creditor. I do want to impress very strongly on the Minister that it is the considered view of investing institutions and of the principal banks, so far as I can gather, that under the scheme, as it stands at present, if the debtor is to pay 3½ per cent., and per cent. is to be collected from the State, it will be almost an intolerable burden and expense. The Minister knows that there are many objections to this type of legislation, but the House has adopted it in principle, and one has to respect the view so laid down. But I do hope that when it comes to the committee stage the Minister will be prepared to consider some of the amendments that will come forward. We do not want to place any obstacles in the way, but one has to consider the whole position, and there are a number of difficulties that have to be overcome. I hope the Minister will receive the amendments in the spirit in which they will be put forward, namely to have as little interference as possible with the rights of creditors and debtors.

I just want to voice my appreciation of what the Government has done under the extraordinary conditions of the prevailing situation. We were prepared to give the Government absolute power to do what they thought necessary, and it was in that spirit that the coalition Government came about. I look upon this coalition Government as a sort of martial law government. We have extraordinary conditions, and we want to give extraordinary powers to the Government to bring about a reconstruction of our economic position. I do not want to say that farmers are entirely blameless in the position in which they find themselves to-day, but I want to say that we must associate ourselves with the Government and with the business fraternity as well. All of us have been living beyond our means and spending far more money than we should have done. If we think of it, during the last seven years, the cost of administration of this country has gone up at the rate of one million per year, which certainly is not satisfactory as far as we are concerned, but it only shows that we are all to blame. I am mentioning this to show that one section cannot blame the other. But I say that it is unfair for any one section to have any feeling of resentment against the farming community in so far as its extraordinary expenditure is concerned. I do not want to bring up any criticism beyond an endeavour to put the matter before the Government with an idea that they might rectify the position where they have not met us to the full extent. It is more in that direction that I want to make my remarks. I regret that the agricultural community has never been consulted as to how the assistance to the Government could be most effectively given. In our organizations as farmers, we have our advisory board which was never once called together by the Minister and which was never given the opportunity of expressing the view as to how the position could best be met. I do claim that we have a great deal of horse sense in our agricultural societies in the country. In dealing with this matter there are some directions in which we should like to see the business expedited. We think it would be only fair if you have in each district a small committee appointed by the farmers themselves to assist the Government and give them advice in the matter of how assistance could best be given. We want the matter to be decentralized, so that all assistance could be given as quickly as possible. There are farmers who do not need assistance, and I would rather see State aid go to a man who actually needs all the help we can give him. If we had committees such as I suggest, they would aid the Government to find out those who really do require help. Some farmers have got into difficulties through no fault of their own, but there is another type of farmer whom it is useless to assist. If you help them they again get into trouble. After all, this is a subsidy; some people even call it a dole. Subsidies are undesirable, and should be used only as expedients. I realize, however, that the Government has been put into the position of having to adopt this scheme, and I am not blaming the Government for it; all the same it should be recognized that this is only a temporary measure. We want a far more solid system of rehabilitation for the farmer, for we cannot go on as we are to-day. In the best of times, we cannot anticipate that this system will be permanent; we must go very much further, and unless we can evolve some scheme of a lasting nature, a scheme which also includes provision for the reduction of the amount of the bond, by a yearly payment as a redemption, there will be no stability. Whatever assistance is given should be regarded as being merely temporary, and during the recess, we should try to discover some scheme of a stable character. If Government can introduce next session a scheme of this sort, they will render a signal service. This coalition Government still has to prove itself. If they are able to carry on for the time with this present scheme and bring in a rehabilitation scheme of a satisfactory nature later, we shall not have paid a pennypiece too much for coalition and the benefit which will be derived. I admit quite freely that there has been too much dependence oil the Government in the past, but we want to get at the root of the trouble as far as the farmer is concerned, and ascertain why he cannot make a living. We realize that he has to contend with forces of nature over which nobody has control, but what we want is to have agriculture placed on a permanent basis, apart from drought and other troubles arising from forces of nature. The farmer is, I think, entitled to such consideration, because, when you come to think of it, he is a taxpayer, and the mines and farming are the main sources of wealth in this country. What we want is money from overseas in exchange for our products. If we can increase exports, and develop our markets in this country, as well as our overseas markets, and stabilize our men on the land, then we shall be going a long way towards putting our farmers in a better position. Why have certain companies put up expensive buildings in the centre of the city when you can buy land more cheaply in district six. It is the same with a farmer. You cannot blame him for not buying land more cheaply than he does. He wants good land in a good situation. My hon. friend, the hon. member for Cape Town (Gardens) (Mr. Coulter) represented that we had had golden showers and the Government distributed largesse amongst us. Might I tell my hon. friend a story about a legal gentleman? This man had swallowed half a sovereign, and when they operated on him with a stomach pump they recovered only 3s. 4d., they did not know what could have happened to the rest ! They at last came to the conclusion that it had been absorbed by his legal system. I say it is a bad and sorry day for us if we are going to harbour such ideas as between town and country as some wish to do. We are only a small community, after all, and if we are going to cast recriminations and try to bring the farming community into disrepute with the towns, or vice versa, we are going to render ill service to the country as a whole. We welcome on farms the sons of professional men, and in many cases they have turned out to be excellent farmers. What we want is more tolerance from one section to the other. I regret some of the remarks which have fallen from some hon. members, which do not show that friendly feeling that there should be amongst us. Our land is the only asset that we have. You have got to produce wool, mohair, or whatever it is, or leave it. If you deplete the country districts of their inhabitants you will have a ruined State. It is absolutely essential that you build up an agricultural community and that they should have a fair opportunity in life. That is only what we are asking for. As I said in my earlier remarks, we are not entirely blameless in the matter, but we want only fair consideration. If there is not a fair turnover all round from agriculture, it will be very detrimental to the State.

The hon. member is now dealing with agriculture generally.

I agree that you should retain men on the land, and I think that is the Government’s endeavour. I should just like to remark also, to show how dependent the rest of the community is on the farming community, where would your secondary industries be if it were not for the primary producer? If it were not for the primary producer, the secondary industries could not turn their articles into more valuable ones for sale or export. We are so wrapped up in one another that you cannot allow one section of the community to go down without affecting the other. There is no boundary line between the interests of the business man and those of the man living in the country. What we want the Government to do is to carry out what they have in hand, and we wish to support them in that, but we want them to realize that it is only temporary and only an expedient and we want something more stable and more lasting and satisfactory at a later stage. This will tide us over the immediate trouble and retain men on the land, which is our main object, but later on they should appoint a competent committee to bring about measures of redemption and of rehabilitation during the next session of Parliament, and then I think with the assistance of that committee we should be able to bring in measures that would be of more lasting effect. That is what we are hoping for. Unless this can be done, and unless the redemption of debts is included in such a scheme, we cannot look forward to any real solution of our troubles. You have old loans on farms which have been running on for years at a low rate of interest. The farmer realizes that he can put his money to better advantage than by paying off the debt, and unless you have redemption the farmer will never pay it off. It is only by well-considered schemes under which money can be lent at low interest plus redemption, that the farmers can be satisfactorily rehabilitated on the land. If the Government would turn their attention to this, they would have the appreciation of every farmer in the country. We realize they have not had time to do it up to now, but we are justified in putting forward this plea.

May I, on behalf of the farmers, add a word of praise to the Government for the efforts which are made in this measure to grant some relief to the farmers? The coalition Government received its majority on a promise that steps would be taken to assist farmers with regard to the interest on their bonds. This Bill is carrying out that promise. Many farmers owing to the low prices which have been ruling for the past few years have found it almost impossible to meet the interest on their bonds. Through circumstances beyond their own control, they could not create better prices for their products. While prices have fallen in an unprecedented manner, interest has remained practically stable. On the one hand, prices have dropped beyond recognition and on the other hand, the interest which the farmer has to pay on his bond has remained at exactly the same rate as when he was receiving very good prices for his products. My hon. friend says that the interest is higher in some cases. That is true. I blame the commercial banks for the interest remaining so high. This measure does not unfortunately affect the commercial banks which are still free to charge whatever interest they like. The commercial banks have taken every ounce they could out of the farmer and I say that they have not treated the farmer fairly. All they have thought of was the paying of fat dividends to their shareholders. I say again that the banks have not rendered that assistance to the farmers that they should have done. The banks could long ago have reduced their interest. The banks to-day are only paying 2½ per cent. to their depositors, but they are charging people who require advances from 6½ per cent. to 8 per cent. I know of a case, where a farmer is paying 8 per cent. on £3,400.

Is his security good?

His security is a first-class bond. I say that the banks are in a good many cases the cause of the ruination of our farmers and they have in many cases forced the farmers to sell their stock and everything that they had and have left them with their bare land. And not only have people to pay 8 per cent. on the money they get from the bank, but they have to pay monthly so that it works out at 10½ per cent.

Why do they not go somewhere else?

How can they? The banks have the whole of the country in their hands, economically. They work together and decide what interest they should charge. It is not the public which decides, it is the banks. There are two banks and they between them control the whole position to the detriment of the people. My hon. friend must admit that it is not fair for the banks to pay 2½ per cent. on deposits and charge 8 per cent. on its bonds and overdrafts.

Do you know that on the 31st of March, 37 per cent. of the deposits in the bank were at 5 per cent.?

And what do they give to-day —2½ per cent. Yet if you want to borrow that same money, you have to pay 8 per cent. I say that the trouble we are in and the high interest which we have to pay, are entirely due to the banks. Hon. members will agree that the remarks which I am making are not unfair or unwarrantable. Thousands of bonds have been ceded to the banks as security for overdrafts. There is no provision made to help the person who is in the position of having ceded his bond to the bank on which he will now get a lower rate of interest, while he has to pay the bank 8 per cent. for his overdraft.

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

Before the House adjourned I made some remarks regarding the banks, and I also made one or two errors in that connection. I mentioned that the banks were charging 8 per cent. per annum on money borrowed from them. What I should have said was, that the banks charge 8 per cent. per mensem. I mentioned that people who deposited money with the banks received interest at the rate of 1½ per cent. per annum, if the money were placed on fixed deposit for a period of less than six months. What I should have said was that in that case the depositor receives no interest at all. I also made an omission, for I should have coupled the Reserve Bank with the commercial banks. I think the Reserve Bank is one of the biggest sinners. Last year, during a period of a little more than twelve months it was able to replace its reserve fund of £800,000 which it had lost. Where did that £800,000 come from? I think it fair to say that the greater part of this sum came out of the pockets of the primary producers. The Reserve Bank is just as much to blame as the commercial banks in regard to the high rate of interest on overdrafts. The rate of interest generally should be reduced, and this Bill seeks only to force interest down to 5 per cent. on bonds. I agree with the hon. member for Cape Town (Gardens) (Mr. Coulter) when he says that this measure makes an attack upon the sanctity of contract, but that has become necessary owing to the extraordinary position which has arisen. I wish to refer to a case in which a bond on a farm has been ceded by the holder to a third party, usually the bank. A peculiar anomaly will arise. The person to whom the farmer has passed the bond will be compelled to rest content with 5 per cent. interest, but as the relations between the bondholder and the cessionary are not affected, the cessionary will still be entitled to claim the same interest as before. Thus the cedent will receive only 5 per cent., but will have to pay the cessionary 7 per cent. The result is that the cedents will have no alternative but to call up their bonds, and thereby create a very serious position to the mortgagors as in such a case the sum of £4,000,000 which the Government is providing will be wholly inadequate. Whereas hitherto there has been a voluntary moratorium, as soon as this legislation goes through you will find that many bonds will be called up and the voluntary moratorium will disappear. I want to tell the Minister in charge that when the committee stage comes I am going to move an amendment that where a bond has been ceded the cessionary shall not be entitled to more than 5 per cent. If such an amendment is accepted it will go far to protect the farmers from foreclosure. A lot of anomalies are going to arise out of this Bill. Take the case of the investor.

Are you opposing the Bill?

I am accepting the Bill with both hands, but I think it is my duty to point out anomalies. Take the case of a widow who has £5,000, and who has invested that money at 6 per cent., and receives £300 per year from a farm debtor. The farm debtor has an income of £600 a year. Out of this he pays £300 interest in his bond of £5,000, leaving him a net income of £300. What is going to he the position after this legislation. The farmer will be in the position that his nett income will be increased from £300 to £425 and the widows income of £300 will be reduced to £250.

What would happen if the widow got married?

I think that as we have a strong Government in power, it is up to this Government to go the whole hog, and to make everyone subject to the same condition, so that no bondholder during the state of emergency shall be entitled to more than 5 per cent.

What about the widow?

The hon. member will have his turn—I ask him to be good enough to let me have mine. I maintain that, in applying this only to the farm bonds, the credit of the farmer in the future is going to be seriously affected. My reason for saying that is that you may have an investor with part of his money invested on farms, and a part invested in the town. The interest on farm investments is brought down to 5 per cent., and the interest on the town investments is not. What is going to be the effect on the mind of that investor? I say that this should be made applicable to everybody, and that the Bill, as it stands, is calculated to do more harm to the credit of the farmer than otherwise. The effect of this reduction, it is said, will be to make interest go down in towns. If that is so, then I say there is all the more reason that the Government should apply this to all bonds, because otherwise you are going to prejudice unnecessarily the farmer’s ability in the future to obtain money on his property. I notice that the definition of a farm here does not include a company. Let me say that in my constituency there is a proprietary company consisting of a group of returned soldiers, who have spent a considerable sum of money in establishing a poultry farm. Their whole operations are on the farm? Why should they be excluded from reaping any benefit? I think the scope of that definition should be enlarged, and I hope the Minister will be prepared to make an amendment in this direction. Then I would like to support the hon. member for Ermelo (Col.-Cdt. Collins). I think we should give the investor some consideration. While you are compelling him to reduce his interest to 5 pet cent. T think you should give him some consideration, and I suggest that the Government should allow a rebate on his income tax in regard to that part of his income which is derived from farm bonds. I think some consideration should be given to the investor who is asked to make a sacrifice, so that all interest which is compulsorily reduced to 5 per cent. should be exempt from income tax. If the Government do that, T believe they will prevent a tremendous upheaval, and to a very large extent stop the calling up of bonds. I am not so pessimistic as some of the hon. members on the opposite side, I still have faith in our farmers. I do not agree with the articles in cur newspapers, which say that you are undermining the fibre of the farmers, and making them weak-kneed and unreliant. There is no section of the community in South Africa which, during the hard times that we have had, have faced them better than the farmers. They have had a terrific storm to weather, and a great number of them have weathered it successfully. I quite agree that a small number of farmers are going to benefit who should not, and who could get along without assistance, but the great majority of the farmers require the assistance designed under this legislation, otherwise they will be forced off the platteland into the towns. Let me mention one set of farmers. Those who, when times were good, paid off their liabilities. That type of man by his thrift is receiving no benefit at all. Then you have the conservative type of farmer who refuses to pass a bond and allow any endorsement to be made on his title deeds. He has borrowed money without passing a bond, and because of that he is going to receive no relief at all under this Bill. It seems to me manifestly unfair that that type of farmer, who on principle refuses to pass a bond on his farm, should be excluded from receiving any benefit under this legislation. There is another set of farmers—the tenant farmers, who are also receiving no benefit under this legislation. I am not talking about the tenant farmer who has nothing, but of the ordinary tenant farmer who is paying high rent to his landlord for his farm, and I say there should be some provision under this Bill to prevent the landlords during this time of stress and difficulty of charging more than a fair return on the depreciated value of the farm.

He may be hard up, too !

There are other matters, which I shall bring up in the committee stage, and I only want to make these remarks now to show that unless some consideration is given to investors more harm may arise out of this legislation than otherwise; the voluntary moratorium will disappear, and a number of investors will call up their bonds and cause a debacle in many constituencies in the rural areas. You can come to some arrangement with organized capital, but where you have no organized capital the position may be different. I ask the Government to give some consideration to investors, as I have mentioned, and see whether they cannot be met also and be given a small quid pro quo for the sacrifices they will be called upon to make under this Bill.

This Bill, which we have before us now, is of the greatest importance to farmers. We naturally realize how drastic this measure is which is now before Parliament, and we farmers feel that we should be grateful to the Government that it has found it possible to introduce this measure. At the same time, I feel that these steps should have been taken two years ago because the collapse in the price of our products has made it impossible for farmers to carry on. I have been saying for the last three years that unless some thing was done by the Government I could not see how the farmers could be saved from ruin. And that is the mandate which the electors gave to the coalition Government during the elections. I think that the mandate which the Government received from the electorate of South Africa is that the farmer of South Africa must be saved from ruin. For that reason I feel that although we should be grateful to the Government, it is a duty which the Government has imposed upon itself to pass these measures into an Act. Had this not been done I would have been very sorry for the farmers. The hon. member for Cape Town (Gardens) (Mr. Coulter) tells us that 60 per cent. of the farmers are not in arrear with their interest. He knows very little about the farmers.

I had authoritative information.

I imagine that I am a better authority than the authority who told him that because I live among those people. I represent one of the best constituencies in the Cape Province, viz., Albert, where one finds the most progressive farmers in South Africa— sheep farmers. Until a few years ago the farmers were flourishing, but then we got the collapse of prices, a state of affairs which was caused not by them themselves, but by economic fluctuations. It is stated that 60 per cent. of the farmers cannot pay their interest. If the hon. member realizes that even the farmer who, for the past two years has not had a bond on his farm, is able only, with the greatest difficulty, to pay his running expenses, how then can the man who has a large bond on his farm carry on? The people who are living in the towns to-day have been in exactly the same position since the economic collapse occurred, as they were in before, they have been receiving exactly the same money as they received before. The hon. member for Cape Town (Gardens) receives the same fees, in fact I would not be surprised if his fees had gone up. At the same time, however, the products which he buys have gone down by 60 per cent., 70 per cent. and 100 per cent.

The price of meat has gone up.

The price of meat may have gone up a little bit now, but what they first of all paid 1s. 3d. to 1s. 8d. for, they got later on for 5½d. The farmer to-day does not get more than 2¾d. for his meat and what of the prices of other products? We hear people plead here for widows and orphans who have invested their money. I have a great deal of sympathy with them, and I shall always have an open heart for them, but what is their position? The widows who invested £5,000 at 6 per cent. have been getting £300 per year. The; farmer had to sell everything he had in order to pay that amount. He had to sell three or four times as much wool as in the past in order to be able to pay that. The interest which the widows receive remains the same, and I cannot see that any injustice is done to them if that interest is reduced now. If this Bill had been introduced two years ago the farmer would not have been in the position in which he is to-day. Our farmers feel humiliated that they require this assistance, because it is their own fault that they are in their present condition, as they do not farm on the right lines. No, I consider that history has shown us that the farmer has always done his duty towards the country, and that he has always suffered the greatest privations in the country. Whenever adversity or depressions came, the farmer was always the man who suffered most. In spite of that the farmer was the man who developed the country—and that cost money. The farmers did not put their savings into the banks, but into the development of the land. If hon. members representing the towns criticize the Government, and if they indirectly attack us, I want to refer them to the great importance of the farmer to the country, and I want to show them what a calamity it would be for the country if all the farmers who have invested their money in their land should be driven off the land, if they should be sold up and the bondholders should be left with the farms. This would bring with it the total collapse of the economic life of South Africa, and it would not hit only the bondholder, but it would affect everybody in the country. For that reason I welcome the step taken by the Government. It is true that this is a measure of far-reaching consequences, but conditions justify the taking of these steps. We are at the moment passing through an economic war, and in those abnormal circumstances the Government is entitled to take such measures. What troubles me most is that the bonds are being called up now. The Lank Bank will have to take them over, but the Land Bank may possibly be too careful, and may say to the farmers: “You cannot make a success of your farming”, and I fear that the price of the land may be put too low by the Land Bank. I hope that the Land Bank will not value the land too low, and that it will not merely take into account present-day prices, but that it will also take account of the future, because we all hope that prices will go up. I am not very scared by the contention that very many bonds will be called up. The hon. member for Ermelo (Col.-Cdt. Collins) spoke about £20,000,000 having to be found for the taking over of all the bonds. I do not believe that it will amount to £20,000,000 but I think it will be more than £10,000,000. I imagine that the Government will be prepared to find the necessary money, and that it will not allow the farmers to be driven off their farms. Then there is another matter to which I want to refer. The farmers who have bonds are being helped now. This is a considerable concession and we are very grateful for it. There are other far mers, however, who have gone to the commercial banks and have borrowed money there, and who have consequently been working on an overdrawn account. And hon. members have said, they have to pay interest up to 12 per cent. per year, and they are not being assisted. One of the hon. members asked why they do not go somewhere else to borrow money. I consider that it is not reasonable to ask that question seeing that the two or three commercial banks have a monopoly in South Africa. If that is the attitude of the commercial banks, I think the time has come for the people of South Africa to realize that the sooner we establish our own South African commercial bank, the better. I consider that the commercial banks should also be compelled to reduce their rate of interest. It is wrong that they, themselves, should only pay 2 per cent., while asking the farmer and other sections of the population to pay them 8 per cent. I am sorry that the Government did not find it possible to reduce all interest to 5 per cent., but seeing that money is so cheap to-day, I consider that the Government should take into consideration the question of preventing the banks and other institutions of asking more than 5 per cent. We are going back to our homes to bring the farmers glad news, and this will be appreciated, but in my constituency I also have large numbers of poor people in the villages who have bonds, and they are not being helped. They will be asking me why their interest cannot be reduced. We have been told that the Government does not regard this as possible at the moment, but I do hope that during the recess that the Government will see whether it is not possible to bring down the interest somewhat. As regards farmers who have rented farms, I am not going to say that they are in exactly the same position as those farmers who have bonds on their farms, because the farmer who mortgaged his land some years ago always has to pay the same rate of interest, but a contract of lease only runs for a few years, and the tenant can always enter into a new contract and pay a lower rent. None the less I am sorry that the Government has not found it opportune to come to the assistance of those people. I have discussed the matter with the Minister of Finance and he has told me of his difficulties, which I can understand. Possibly he may be able to do something for these people during the next session of Parliament. I am now speaking of the next session, although I sincerely hope that it will be only necessary for one year to extend this help. As the state of affairs, however, has been rendered so serious as a result of drought and depression I fear that it will take more than a year before the farmers will once again be in a fairly satisfactory position. We have, however, listened with a sense of gratitude to the statement of the Minister of Finance that, while the farmer finds himself in his present precarious position, the Government will meet him.

I am always sorry for the Government when the farming community, or any section of the community, finds itself in i difficulties. When this happens means of succour are looked for to relieve those people of their difficulties, and on this occasion, too, we have not been lacking in advisers who have suggested ways and means out of the difficulties, in the first place, we were told in this House that we would rid ourselves of all of our difficulties if we left the gold standard. We have left the gold standard, but I do not think that we have rid ourselves of our difficulties. Afterwards we heard again that we were unable to solve our difficulties because party political quarrels were being carried on. Subsequently, the way out of the difficulty was suggested as lying in the direction of all parties being abolished because, if that were done, we should find ourselves in the position of being able to i solve our difficulties. Temporarily we set the party system aside, and yet we have not got rid of our troubles. The fact is that there is no panacea, no general way out along which our difficulties can be set aside. We have learned from experience that as soon as we try to solve one difficulty we create another one, and for that reason I say that I sympathize with the Government because I feel that the coalition Government, just the same as the party Government, is face to face with great troubles which cannot be solved in one day. But as they are faced with such a difficult task, I was also very sorry that the Government was not able, first of all to make a thorough study of the matter, so that they might have come forward with a more comprehensive and more effective plan. I want to say at once that I, and I think the country, too, owes a debt of gratitude to the Government for the measures which it took at once. By doing that the Government showed its good intentions, it showed that it realized the farmer’s difficulties, and that it did not want to disappoint the public in the expectations which it cherished that something was to be done, but that it wished to do something at once, something which, in its own view, was going to help considerably. Yet I feel that in the time at the Government’s disposal it was impossible to develop a plan of such a farreaching and effective nature that we could regard it as being the best that could be done in the circumstances. For that reason I hoped that the Government would come to the country with a clear statement to say that we have a temporary measure here, and that it was a measure which had to be taken while careful enquiry was being made so that more effective and more drastic steps might be taken by the Government to help in a permanent solution of the problem. As regards this, I am sorry that the plan submitted to us is of a temporary nature, and that a promise was not made at the same time that an enquiry will be made to do something else towards the solution of our problem. I feel that the absence of a promise of that nature causes uneasiness in the country. The plans that have at the moment been put before us go too far in certain regards and do not go far enough in other respects. It goes too far because it proposes to help people who do not require help.

There are very few of them.

Take the farmer who has a small bond but who otherwise is a well-to-do farmer; he is helped under this scheme. Then there are farmers who have a bond but who, in turn, are also bondholders. A farmer like that is a well-to-do man and does not require assistance. He is also helped under this scheme. In that respect the proposed scheme goes too far and the assistance given to such people could have been used far better for the purpose of helping other cases where greater help is needed or where no help is given at all. The proposed scheme falls short to this extent that it is of a temporary nature, as I have already said. The farmer does not know yet what the future holds for him. He has been promised that the Government will give careful consideration to the matter while times are bad. Yet there is no security in regard to the position.

Security in regard to what?

Security in regard to the question of how long times will be bad and how he is to be helped.

The Government cannot tell you how long times are going to remain bad.

But the Government can give assurance as to how the farmer will be helped in the future. If he knows exactly how he stands towards his bondholder in future, he will be better able to make arrangements with the bondholder. The bondholder, however, does not know how he will stand in relation to the farmer, and the result is that he is not able either to arrive at a businesslike arrangement.

Cannot you suggest to me what is aimed at?

During the budget debate I suggested that a commission should be appointed to consider the economic condition of the farmer and that such a commission should come forward with a comprehensive scheme. If that is done, we can proceed on definite data. We shall then build on a sound foundation, and we shall work in a definite direction. At the moment the assistance that is given is temporary and we do not know what the position is going to be to-morrow. Furthermore, no provision is made for a certain class which requires help. Take the case which the hon. member for Albert (Mr. Steytler) mentioned, viz., that of farmers who have not got a bond on their farms, but who have overdrawn their accounts to the extent of thousands of pounds.

What about the man in the town who also has debts of that kind?

But we are engaged now in helping the farmer.

Yes, but we cannot help the one and not the other.

For that reason I approve of the suggestion of the hon. member for Albert that the general level of interest should be reduced. We are helping the one man but we are not helping the other one. That is exactly what we are doing here and that is what I am criticising. I agree with the hon. member that there are people who have overdrafts and on those overdrafts they have to pay 7 and 8 per cent. I am of opinion that in that direction too assurance should be rendered. Furthermore, no provision is made under this scheme for a system of debt redemption. There is a further weakness, and it is a great weakness, that no assistance is given to the tenant, to the bywoner, and to the farmer who has come to the end of his tether. Furthermore, no provision is made under this scheme of the Government, or under the estimates, for farmers who have come to the end of their tether and who want to buy land again. I have criticized that aspect already during the budget, I have criticized the fact that no money is being voted for settlement. I deplore the fact that the Government is not making provision at the moment to avail itself of the low prices of land in order to promote settlement under the Land Settlement Act. Land may be purchased cheaply at the present juncture, and those people who have been driven off the land, and who have set aside a little money, would be able to avail themselves of the opportunity of getting land once more. According to the statement of the Minister, no money is being voted for the purchase of land under Clause 11 of the Act. An amount of £120,000 has been placed on the estimates, but that is intended in connection with undertakings that have already been entered upon, and which have to be carried out. Not a penny is voted for the purchase of land under the Land Settlement Act. If we were able at the moment to avail ourselves of Clause 11 of the Act, farmers would be able to purchase land, and there would be no need eventually to write off anything in respect of that land. Several years ago when the land was expensive £600,000 was voted in one year for the purchase of land under Clause 11 of the Act. But now that land is cheap no money is voted.

They have never paid interest on the expensive land.

That is exactly my argument that the prices of land were so high that they were unable to pay the interest. If, however, we buy land on the present basis, then it will not be necessary to write off anything in the future.

It does not cost them anything because they have not paid anything on the land.

Another great weakness in this scheme is that I think that there is a grave danger of bonds being called up owing to the insecurity of the whole position. I have already heard from trust companies and loan companies that they are uneasy in regard to the position. There is a feeling of insecurity among those people, and they think of calling up bonds and of investing the money in a different direction. Furthermore, they are definitely unwilling to make money available for investment in farm bonds in future. Another danger in connection with this matter is that now that the Government has placed money at the disposal of the Land Bank for the taking over of bonds, there will be bondholders who will avail themselves of the opportunity to call up bonds so that they will now be able to get back the money on bonds where they had thought that they would never have been able to recover it. Many people had got so far that they had taken it for granted that the land was no longer bonded under their mortgage bond.

Is it wrong that the money is to be given to the Land Bank?

No, but I should like to have seen provision made in the scheme for machinery so that the Government would be able to interfere as between the mortgagor and the mortgagee. We should have taken steps to get those two people together so that a portion of the bonds can be written down to the real value so that it would be possible for the farmer one day to pay that amount of his indebtedness.

Do you consider that provision should have been made in the Bill for the writing down of bonds that are too high?

No, I know that that cannot be done by means of legislation, but I did want to see machinery created to bring the people together for the purpose of negotiation. One cannot force those people.

What is there to prevent that being done now?

Well, I hope the Government will provide that machinery and will appoint a commission of three people in each district composed of the magistrate, a person of business experience, and a farmer. The members of the commission should be people able to negotiate with the bondholder and the person whose property is bonded in order to see to it that the bond shall be placed on a sound basis. As things are now those people will get interest which they would otherwise never have got. I know of instances where the bondholder, on his own initiative, has reduced the interest on his bond to 3½ per cent., whereas he will now get 5 per cent. If one can negotiate with a man, one may be able to get him so far that he will be prepared to reduce the amount of the bond by 30 or 40 per cent. If he does not want to do that, the advantages in regard to interest, which would otherwise be given to him under this Bill, can be withheld from him.

That can be done now by the Land Bank.

No, one cannot do that now. He gets 5 per cent. on his money now i whether he reduces the bond or not. The Government should say to the mortgagor that it will help the man if the bondholder is also willing to help. What is required is a carefully thought-out scheme that will give a permanent solution of the difficulty, not only for the individual farmer, but for the farming community as a whole. For that reason I had hoped that the Government would have come forward with such a scheme. However well intentioned the Government may be with this scheme, I want to repeat here that I am grateful to the Government for the help which it is extending, but I hope, none the less, that it will not be taken amiss that I criticize these measures. We are all inspired with the same wish, and that is to arrive at a solution of the economic troubles of our country. I had expected, however, that the Government would have appointed a commission, an economic commission, to enquire into the economic condition of the farmer, and which would come forward with a well-thought-out plan on which the Government would be able to act. I am still hopeful that the Government will be able to appoint such a commission.

What really must that commission do?

I call it an economic commission, it must make investigations into the position of the farmers. It must make investigations into the credit system, it must look into the burdens that are imposed on the farmer, and so on, and then it must come forward with a well-thought-out scheme which it considers the Government should act on. By doing that the Government would guard itself against possibly having to take other steps in future that may be suggested to it. If the Government were to have an enquiry of that nature made now, it will always be able to point out to the country that it has done what was regarded best in accordance with the considered opinion of people of experience. I merely remind the Prime Minister of the condition that was created in Oudtshoorn. He will remember that when the ostrich feathet industry collapsed we also came forward with a number of suggestions. I approached the Government and asked them to help us. Later on I asked the Government to have an enquiry made into our economic position so that we might see what could be done for the people. I was very pleased that the Government listened to us at that time. The report was published and people were satisfied, because the commission made it clear to ns that we were only a small section of the country and that the steps which we wanted taken would not generally be applied. People realized this, and they accepted the position and there was no continued agitation. And that is the position to-day. If the Government were to appoint a commission, if it were to appoint responsible people, it would be guarded against having to take measures in future which would not be of much assistance. It would then be able to adopt measures which would lead to the permanent solution of the problem. The means that have been taken so far are merely palliatives, and they are not permanent steps. Take the Farmers’ Relief. Act, it was only a palliative.

Did not it save the people?

No it was a palliative.

What do you call a measure that will save people?

A measure that will save people, is a measure which will give a person the prospect of his being cured. It must be a scheme that will give an assurance to the farmer that he will get out of his difficulties. It must not be a scheme which will merely bring temporary relief of pain, but a total cure.

Must all his debts be redeemed?

But the relief Act did not redeem all his debts.

Was it not a means of saving him in those days?

The Prime Minister will remember that I said at the time that it was only a palliative. I think I am right, and if the Minister of Finance were here I imagine that he would admit that however well-intended the relief Act was, it did not quite answer its purpose, and that we could have used the money very much better. The same thing applies to the subsidy payments. They are not a definite cure, they are a palliative.

Can you suggest anything?

I have said that, to my mind, nobody possesses that wisdom to enable him immediately to suggest the necessary cure, but for that reason I consider that an investigation should be made with a view to ascertaining whether there are not people in the country who have so much brain that they can suggest a cure. But when I make a proposal of that kind, the Prime Minister must not think that I merely want to criticize, because I am anxious to help the Government to ease the position of the farmers, so that they may realize that everything possible is being done for them. Before an enquiry of that kind is made, the farmers will always imagine that something better could have been done for them. I should like to have an enquiry made into the general farming conditions, and I wish the Government to act on the advice of people who have considered the position as a whole, and who have come forward with a scheme which is generally acceptable. The farmers wish a system of debt redemption and writing off to be considered. The State cannot allow the debts of the public to be written off at its expense. I admit that readily, but possibly another system of writing off may be created.

Do you want this Bill to stand over until that has been done?

No, I admit that the Government could not wait until such an enquiry has been made. This temporary measure was necessary, but an enquiry can be made in the meantime. In addition to this permanent help, assistance is needed for people who are in temporary difficulties, and the proposed assistance is excellent so far as they are concerned. If this assistance is rendered long enough and prices go up again, that man will be saved. It will help this class of people, but it will not help all of them. We do not know what percentage of our farmers are only temporarily in difficulties, but, as I have said before, I am of opinion that that applies to the majority of our farmers. But we have to go further, and we have to enquire into an effective scheme to assist the poor class of farmers, the tenant farmer, and the farmer who has come to the end of his tether, so as to enable them again to make an existence as farmers. Furthermore, a commission of that kind would have to enquire into marketing conditions. I am pleased that the Minister of Agriculture has appointed a commission to enquire into the operation of co-operative societies. I am very pleased that he has done so, but the terms of reference of that commission could have been more comprehensive, and I want to plead again, not that that commission should be made bigger, but stronger, and that it should be given more comprehensive terms of reference so that it might enquire into the general condition of the farmers. Furthermore, I should like to see a general revision of the credit facilities of our farmers. I am not referring to an extension of credit, on the contrary, because that exactly is the difficulty of the farmer to-day, that they have had too much credit in good times. What I want is a more effective and a sound credit system and for that reason it is necessary to enquire into the measures that require being taken to protect the farmers in future so that they shall not take too much credit and unhealthy credit, which will again bring them into difficulties. Tn conclusion, I again wish to appeal to the Government to enquire into the general condition of the farmers, to see whether steps cannot be taken effectively to help the farmers who are in distress, and also to consider what steps are necessary with a view to preventing their getting in the same difficulties again in future. I hope that the Government will receive my request in the same spirit in which it was made.

I am sorry, but I think that I must ask my hon. friends what they want, what their object is? I refer to hon. members who have spoken as the last speaker. Of course, it is very nice to rise and plead in this House for every section of the electors: for the tenants, for the farmer who has lost everything, for the fellow who is suffering hardship owing to his bond, and for all the other sections. It is very easy, and one will always obtain favour for one’s status and position as a representative of one’s constituency. But I have often found that it is those hon. members who later on experience the great difficulty in their constituencies, and for the following reason. Everyone with common sense realizes that it is impossible for the Government to provide for everyone’s needs. What then is the object of the Bill which has been introduced in this House? The object is to meet the needs of a certain class of farmer. This is the farmer who has a bond on his farm, and who is on the point, or who is running the risk, of being driven off his farm if he is called to pay the full interest on this bond. This is the reason for the introduction. There are no other reasons. The last speaker has said that he is dissatisfied with the legislation because it meets only a temporary difficulty, and is not of a permanent nature. There is only one man who can help the farmer permanently, and this is the farmer himself. No Government has yet undertaken to place one section of the population permanently on its feet again at the cost of another section; and let me emphasize that no Government will undertake to do this. All that can be demanded from the Government is that in certain circumstances, where one or other section is in danger of going under through causes over which it has no control, it shall come to the assistance to enable this section to pass the danger zone. Only then is it the duty of the Government to assist this section of the population over its difficult time, to assist it to the other side and to say to it: “There lies the world open to you, try and get on.” If they again submerge, it must be regarded as the course of the world. Because the Government has felt that the farmers are at present in such a position, it has decided to assist them over their difficult time. Has it not been said, day after day, both in this House and outside, that the farmers must be assisted over this difficult time? But hon. members now come and ask that assistance of a permanent nature be given. These demands date from the day when hon. members began to think that there must be a permanent scheme to help the farmers. If the Government would only spend £100,000,000, the farmers might be permanently relieved of their cross in regard to bonds ! But when the question was put: “When those bonds are redeemed, are the farmers to be allowed to contract debts anew, and what guarantee is there that they will not have to be assisted again?” they were silent, and they are still silent. Not one of these hon. members has replied to this question, but everyone knows that no farmer will allow the Government, by legislation or otherwise, to provide that the farmer is not to make any debt in the future. All that the Government can do, and is entitled to do, if it uses the money of another section, is to assist a section of the population as long as it is in danger; but the Government may not use the money of one section to make another section permanently prosperous. And what has the Government done? Because special pressure has been brought to bear to give assistance to that section which is suffering under the cross of bonds, because it has been urged that the Government must assist them over the difficult time, the Government has decided that the best assistance that can be given is to assist that section of the population to pay interest on their bonds. How did the farmers receive this assistance? Were they not glad about it? What, then, is wrong with this Bill? The Government selected this plan and has taken care to put a limitation on it. The Government has said that it could assist the farmers in these difficult times to carry the heavy cross of the burden of the bonds. We said that the Government could assist them across the bridge, but no further. But hon. members who have spoken are not satisfied. They now ask why we have not gone further and paid for overdrafts. Imagine this ! What was the main reason hitherto given why we should assist the farmer? Was it not that we must prevent people of the countryside from drifting to the towns? Those very same people now suggest such a thing. If there is one thing which the Government feels, it is that the man on the countryside must be assisted to stay there as far as it is possible to do so. They are not satisfied with this, and even the man with the overdraft in the town must be assisted.

No, the farmer.

They even go further and say that the man with loose debts must also be assisted to the last one, as the previous speaker has said. We must help everyone, whether he is of the countryside or the towns. They have not referred to the reason why we are assisting the farmer, and there is now no class of debtor who should not be assisted. I refer to this, because I wish to warn our friends that, if they proceed along these lines, they will frustrate every attempt by the Government to give further assistance to the farmer. They cannot expect that more is taken from the other section of the population, who will have to carry the burden, to give impossible panaceas to the farming population. If we are to give this kind of assistance, the other section of the population must also be helped, and not merely the farming community. Tn order to obtain this kind of assistance for the farmer, the other section of the population is also dragged in. It is clear to me that these speeches, pressing for such unreasonable things, will have, as a result, that the farmer cannot be assisted further. It has been said this afternoon that care must be taken not to set up the townsman against the farmer. There is no one who has warned more against this than I have done. But I say this: that we cannot go on in this way. If the Government is to comply with the suggestion of the hon. member for Fort Beaufort (Mr. Hockly), it will only be to set up the townsman against the farmer. The townsman will say that so much is being given to the farmer that he will no longer pay. Let me now deal with the overdrafts of the farmers which must be paid. Overdrafts then for all.

Who pleads for overdrafts being paid?

The hon. member for Albert (Mr. Steytler) emphatically referred to this.

What he has said was that interest on overdrafts must be reduced.

This is what I had in mind. But, you must understand, this is the same thing. If I have to pay the interest I also have to pay the overdraft.

On a point of order. May I explain to the Prime Minister what I have said? I did not plead that the Government must pay the interest on overdrafts. All I said was that the interest on overdrafts was too high.

Then the interest on overdrafts must also be reduced like other interest. It will be the same, and the Government will have to pay a share.

No, this is not necessary. The banks only pay 2 per cent. on deposits and ask 8 per cent.

Let us then leave this point, but I ask you on what amount must this be fixed? Must it be placed on the same level as that of interest on bonds on land? In the latter case the bondholder can always obtain his money, or at least the amount he has hoped for, but if he has an overdraft where is he then to obtain his money? The bank has a personal guarantee and where he holds this the interest must now also be reduced to 5 per cent. The hon. member for Newcastle (Mr. Nel) has spoken of 8 per cent. of the banks. It later appeared to me that what he said did not refer to bonds, but to open accounts.

It was on bonds.

This is the case where interest is high, because there is the personal guarantee only. In this case the interest can, surely, not be the same, as when a person has fixed security.

And where the banks have the security of fixed property?

We are not speaking of this.

I know of overdrafts which are secured by farm bonds.

I am not now referring to this. I am speaking of interest on overdrafts where the banks have no fixed security. Take town property. It has been asked that the Government must also reduce urban bonds to 5 per cent. I ask: Are urban bonds also to be reduced to 5 per cent.? Everyone knows that in the case of urban bonds the banks, or at least the mortgage banks, have been reluctant to advance money and they have always done this against a higher interest because they have a security which may burn down.

They give no bond if the house is not assured.

But take other cases. There are cases where a house is neglected. I know this to be the case. You cannot expect interest on those bonds to be reduced to the same level as interest on farm bonds. Hon. members now ask that this must be done. I ask again: Must the Government pay something also in this case? We must be consistent. Why then not in this case? We pay something in the case of the farmer, why then not also in this case? We have decided, rightly or wrongly, that the farmer is to be kept on the land, but does it matter to anyone whether Mr. A resides in street No. 1 to-day, and in street No. 2 tomorrow? Can this be of the slightest interest to the community? No, what is being asked here is that the Government must step in, and assist these people, not only where the State has an interest in such assistance, but because misery must be prevented for those who would otherwise be expelled from their home. I only ask: Where has the State ever done such a thing. This is a case of charity. The previous speaker has stated that not enough is being done for the needy farmers. I wish to point out to hon. members what is being done on the estimates. I read: “Advances to tenant farmers, £79,600 on the loan estimates; advances to tenant farmers and needy farmers, £500,000”. This is half a million. This is assistance to those people, and is necessary. Further, there is the case of the tenant farmer. Here again the Government is doing as much as possible to keep the tenant, the man who is on the farm, on the land, and for this reason he is prepared to assist him.

But in what way will he be assisted?

This does not matter now. It is a question for the department concerned. It can be discussed when the loan estimates are being dealt with. The main issue is that provision is being made for these people. Hon. members have also referred to farmers who have lost everything. I wish to ask hon. members whether they are of opinion that all the farmers who have lost everything must be helped?

I have suggested that provision for them be made under the Land Settlement Act. No money, however, has been voted.

Half a million pounds has been voted.

Not under the Land Settlement Act.

In regard to the settlers the Government has already stated its reasons why no provision is made.

It is the right time.

Here we differ. The Government has already stated its reasons. There is a large sum to assist the tenant farmers. The hon. member for Oudtshoorn (Mr. le Roux) now states that a commission must be appointed. We should not have introduced this Bill.

No, I did not say this. I said that the Bill was good as a temporary measure.

Yes, as a temporary measure. But he is not satisfied, and would have liked more. He wishes a commission to be appointed to enquire into the general position of the farmers. Imagine, the commission must enquire into this, but he gives no details, he simply says that it must enquire into the general position. But will the commission be able to say anything about the general position which we do not already know? I must then say that the hon. member for Oudtshoorn and other hon. members, who represent the farmers, have informed us badly.

We have not been taken into confidence regarding any scheme. We have never been asked to give information.

But you have the opportunity now. I have asked you. If, after all these years we do not yet know what the general position is of the farmers, I ask what commission will be able to tell us any more? I then come to the proposal of the hon. member that an enquiry must be made into marketing. But this is a subject which has for years received the attention of the Minister of Agriculture. Debt redemption must also be inquired into. I ask, what do you desire in this direction, what can you suggest for the enquiry? But, no; reference is only made to the general term “debt redemption,” while, to mention only one thing, there is £4,000,000 on the estimates to be put at the disposal of the Land Bank to take over bonds. To be used by the Land Bank? For what? I do not know what he has in mind when he refers to debt redemption; whether he is of opinion that the State must pay off the debts.

I have said that this is not my intention.

But what other way is there? What can the hon. member suggest to assist the Government? What does he think must be done? Do not all those vague indications mean that it has been said: “You have done nothing, while so much could have been done.”?

Nonsense.

This is unreasonable.

Those who rise in this House and speak on behalf of the farmers, and indicate that the Government has not done what it should have done, must be expected to state what the Government can do; they must suggest something concrete.

I have said that further inquiries can be made to see what more can be done.

But we are constantly busy finding out what more can be done. I wish to say, however, that it is not sufficient to state that there are needy people. It must also be indicated what the needs are, and how those needs can be relieved according to those needy people. This, however, has not been done. It has been said: “Write off.” Must we enquire where, and how this writing off must be done? Do we require a commission for this purpose? Must this commission tell the Government to write off on irrigation debts, on boring debts, on loose debts, or what more. Is this what the commission must tell the Government? Did the Minister of Agriculture not state recently that they are considering, but that the time is not yet ripe for it. I know what hon. members are hinting at. Certain loans have been granted by the Government and they desire those to be written off. They forget, however, that the Government, in the meantime, does not demand payment on these loans, whether it be interest or redemption on capital. Regarding the debts for sheep, contracted with the Government, he states that the sheep have been bought at too high a price, and that the purchase price must be reduced to the present value of those sheep. The Government does not demand interest on capital or repayment of capital. However, the Government now is to write off the purchase price of £1 paid for these sheep to 3s. Why? If the sheep were too expensive, has the time now come to write off? Tomorrow, or later, when we return to normal, the time will come to state the real value of these sheep.

In the meantime these people are pressed daily.

He knows just as well as I do, that this is a mere formality.

Oh, no.

At each meeting where this question was put, I and the Government, stated that no farmer will be required to pay interest or redemption of capital if he is unable to pay.

Why then this formality?

Because the Government considers it necessary and the people do not object. The people have no right to demand further writing off of debts unless it is necessary. Now to state that, because he has received a reminder, as is regularly being sent, everything must be written off, is no argument. No one with any sense of responsibility, no one who is responsible for money entrusted to him, to be used, will ever agree to this taking place. I will shortly repeat what I have stated yesterday, viz., that speeches like those of the hon. member for Oudtshoorn (Mr. le Roux) can have only one result, namely, to create false hopes with debtors, expectations which I, nor any responsible Government, can ever dream to realize. Surely, we cannot think of writing off interest on urban bonds and loose debts or other things? And what is going to be the result of creating such expectations? Not only disappointment in the Government, but also harmful consequences to the country. If it were to be harmful to the Government only, it would not matter much, but if the arguments are to be repeated inside and outside the House, they will further create a feeling of bitterness towards the whole community. Because in this way the people will be brought under the impression that the Government is there, only for a certain class and not to assist others in their position. I will again emphasize that we are harming the country by such criticism and we will do a harm of which the country will not easily recover in the future.

I think that the best proof for the necessity of appointing a commission as suggested by the hon. member for Oudtshoorn (Mr. le Roux), has now been given by the Prime Minister. We are appointing commissions to go into a great number of questions which have regard to the farmers, but the great question of how to give assistance in an efficient manner to farm debtors, is evidently being avoided by the Prime Minister. He assumes that we know already enough about this matter. It may just as well be stated that we know everything about the working of the co-operative societies, because this matter comes before the House year after year. Still, the Government has decided to have an enquiry into this question.

In regard to the system.

If an enquiry can be instituted into the co-operative system, why then not also in a system of farm bonds? But I know which plan the Prime Minster does not like, and will not have proposed. It is the Van der Horst plan. He states that such a plan would mean that the Government will have to spend £100,000,000 for the farmers. Where is he to obtain this money? At the utmost the Government will have to provide only £10,000,000 for the first year under this scheme, and then with regard to interest as well as capital. Thereafter the amount will greatly decrease year by year. Under the Van der Horst scheme provision will not only be made for reducing interest on debts, but also capital debts. The redemption of the capital debt will only amount to 1 per cent. per year. I want to go further than Dr. van der Horst. I would like to see the Government pay annually 2 per cent., or even a little more, of mortgage debts. This can be done without the Government having to borrow a single pound. If I say from what source this money can be taken, I would commit sacrilege in the eyes of the many recruits of the Chamber of Mines, and the acting Minister of Finance will again call me a Rip van Winkle. Well, rather a Rip van Winkle than a Rip van Hoggenheimer, and I think that the people in this case would rather stand by me than by him. The mortgage debts of the farming population are like a millstone around the necks of these people, ana if we are not assisting them it will take many many years—perhaps 30 years—before they reach normality again. Everyone, of course, is grateful for the assistance as regards reduction of interest, but I agree with the hon. member for Oudtshoorn (Mr. le Roux) that after all this is only a palliative, and not a permanent remedy. The Prime Minister tells us that a farmer must save himself. Does he want to intimate that it is the farmers’ own fault that they are in such a miserable position? Are not the cleverest farmers suffering together with the others? How can they help it if there is a world depression, and their products cannot be sold at a reasonable price? They were the first people to feel the depression, and will be the last to benefit by a revival of trade, and there is no greater wisdom when it is said they are the backbone of the country. This has been realized in Canada, Germany, and all parts of the world where attention is not paid to industries only. Let us realize this, too. According to experts the gold mines will, after 16 years, produce only one-quarter of what they produce to-day. Who then will have to bear the national debt and pay the interest if the farming community cannot do this? Where are they to obtain the money if their burden of debt is not decreased in time? The Prime Minister has intimated that the Van der Horst scheme cannot be adopted, because the Government cannot take over any capital debt, but at the same time he mentions the £4,000,000 which the Land Bank will receive this year to take over bonds. What is the difference in principle? But I would not only like to see the taking over of capital debts, but also redemption. Let the commission enquire into the whole question. I regret that the Prime Minister tries to discourage free criticism, and has even uttered certain threats.

I did not want to take part in the debate, but it is about time we gave the impression to the country that we are not all such frightful pessimists regarding farming prospects in South Africa. Everybody who has spoken here so far seems to be imbued with the idea that nothing will save the Union farmers. Hence I welcome the words uttered this evening by the Prime Minister. We have heard from the hon. member for Piquetberg (Mr. de Waal) how the farmers are the backbone of the country, but in my opinion unless some of our farmers learn how to use their backbone and give it some exercise to stiffen it, and learn to look after themselves, the outlook is certainly far from promising. In order to afford some consolation to hon. members, and even to Ministers, I should like to refer them to a recently-published book entitled “Looking Forward” by President Roosevelt. In this book President Roosevelt indicates what should be done, not only in America but in the world in general. It may be a consolation to hon. members to realize that the steps this Government is taking are the steps advocated by President Roosevelt. He speaks of helping the farmers in America. He introduced a land Bill about four weeks ago, under which interest on farm mortgages is to be reduced by the banks and insurance companies. These institutions are being asked to reduce their claims in proportion to present values, and to accept reduced interest. And he goes further. Those who refuse are to be offered Federal Land Bank bonds in exchange for their existing securities. Here you have one of the leading men in the world indicating for the relief of the farmers of America exactly the steps the Government of this country is advocating. Therefore I do not see the necessity for the appointment of a commission to go into the affairs of the farming community. In this book President Roosevelt proposes the making of a survey of American farm lands, so as to ascertain what should be done with them, but at the same time he says it will take ten years to solve this question. If we have to wait ten years to save the position in South Africa I should like to know what some hon. members will say. He makes one point which is very interesting, and which may suit some of the farmers. He says that this Bill which has been introduced and passed by the American Senate contains a proposal to prevent gluts. The Government will lease farm lands, and withdraw them from production so as to prevent gluts, and will pay an annual rent to the farmers who accept this arrangement, and who are prepared to do nothing on their farms. I mention these points because I think we are going a bit too far in South Africa in the direction of pessimism. The duty of members of Parliament should not be to depress the people further. They should rather inculcate faith in progress and prosperity. My firm belief is that conditions in South Africa are going to improve, and that they are going to improve here before they improve in any other country in the world. The hon. member for Oudtshoorn (Mr. le Roux) is disappointed because better results in South Africa have not followed the policy so far adopted. I am firmly convinced that mining will yet improve, and that our farmers will get a better price for wool shortly. What I do see as a drawback is the terrible drought that has been experienced. I am convinced that if we preach the gospel of prosperity, and instil a certain amount of optimisrn, we shall do much more good than by the making of pessimistic speeches in this House.

What is the good of being optimistic when you call up a farmer’s bonds?

The object of this Bill is to prevent bonds from being called up. This scheme now advocated by the Government was mentioned by me on more than one platform during the general election, and the farmers jumped at it. They were absolutely delighted. When you have abnormal conditions you can only deal with them by the introduction of abnormal legislation. I have the greatest pleasure in supporting this Bill, and I certainly commend this book “Looking Forward” to hon. members, because President Roosevelt advocates the measures which our Government is taking to do in America for the farmers what is being aimed at by this legislation in South Africa.

I want to raise a small point. In Clause 4 provision is made that application for the payment of the subsidy shall be made not later than three months after the date on which the interest in respect of which the subsidy is applied for was due. I think that would create a certain amount of hardship amongst sheep farmers, because in some cases where sheep farmers have bonds they probably will be unable to meet their interest, and an extension will be granted. Shearing takes place in October or November, and I think the Minister will be well advised to make the period six months instead of three months. I can see a great deal of hardship, especially in the midlands and in the Eastern Province, if this three-months’ provision is enforced. I don’t think it is the intention of the Government to encourage farmers to capitalize their interest. There is provision that the Minister may in special circumstances extend the period, but I think that would prove cumbersome, and I hope the Minister will agree to amend the clause so as to provide for the period being six months instead of three.

This Bill, I think I may say, has met with general acceptance. The criticisms which have been urged against it are, on the one side, that it goes too far, that it constitutes too much of an interference with private contracts, and, on the other hand, that it does not go far enough, that it gives relief to certain classes, and that it leaves others out. Other hon. members say it is only a temporary expedient, and does not give permanent relief. Well, there is a good deal of truth in all these criticisms, but hon. members must realize that after all this Bill is an emergency measure. I would like to remind hon. members of what the Minister of Finance said in his budget speech in referring to this Bill. He said that the steps that were being proposed must be looked on as relief measures, as emergency measures, and that a permanent improvement can only be expected from a general economic revival. When the hon. member for Oudtshoorn (Mr. le Roux) criticized the Bill, and I do not want to take any exception to his criticizing it—his criticisms were such as one might expect to be made—that the measure is not going to the root of the troubles with which our farmers are faced, I would point out to him that the whole world is looking to a “redmiddel” of the condition of the farmers. In America, as the hon. member for Mowbray (Capt. Joubert) has said, they are attempting to cope with it on similar lines to this, but are going further with their money because they have far more money than we have. But the difficulty of meeting the position of farmers here, and elsewhere in the world, is the fall in the prices of their products compared with the cost of manufactured articles; and as to the gap between the prices of primary products and of the manufactured article, the world has not yet found a way out. We are attempting to keep on their feet, and to prevent being pushed off their land, farmers, whose position is such that they are not yet destitute or beyond hope, and hope that with this help we are offering to them, this temporary help, they will be able to maintain their hold on their land. It may be, as some hon. members have suggested, that the money may be wasted and it may not go far enough, and that some other things have to be done. Even if this does not succeed in putting them on their feet and the depression goes further than we think, the money will not he wasted, and it is being used in taking a step with which every reasonable man agrees—to help men who are not beyond help financially, but who would be beyond help if they did not get some temporary help, to stay on their feet and maintain their hold on their land. What the future holds out for us we do not know; whether something will come from this Economic Conference which is now being held, whether something will be done for nations to increase the prices of primary products, we do not know. This measure is not meant to be anything else but an emergency measure, and we hope it will assist those who are in an emergency and can with temporary help be assisted. Now, let me deal with the effect we are told this is going to have on the calling up of bonds. We know that this Bill contemplates a serious interference with private contracts, and that invariably has the effect of disturbing confidence and making people whose interests are threatened or affected take measures to protect themselves; and some hon. members have warned us that one consequence of this measure will be that bonds will be called up in very large numbers and that the Land Bank will be flooded with applications to take over bonds, and that there will be a “sauve qui peut.” I am rather doubtful about that. It will happen in certain cases, no doubt; but I doubt whether there will be a general rush among the holders of farm bonds to call up their bonds; for one thing, it is not so easy nowadays to find a good investment at 5 per cent. Interest is coming down generally. One effect of this measure will be to increase the security of farm bonds. I do not think the prudent investor is going to rush and to call in his bond.

Not organized capital.

The single bondholder may, but if he does not get into a panic and his circumstances are not such as to have to call it up, and he gets good advice, he will not be in a hurry to call up his bond. We want to make it quite clear that this Bill is an emergency Bill. The hon. member for Cape Town (Gardens) (Mr. Coulter), laid stress on that and thought that bondholders would be very much reassured if they knew that it was an emergency Bill. We give him and we give the public that assurance. I am quite prepared to accept an amendment to limit it for one year unless agreed to otherwise by both Houses of Parliament. The hon. member says there should be a means test, and a farmer getting £300 per year, or more, should not have the benefit of this. That, I think, is going to impose on the department which has to administer this Bill work of a very onerous and difficult nature, and I do not think it will be possible to contemplate putting in a restriction of that kind. There will be cases, no doubt, where a man will get the benefit of this relief who could get on without it, and possibly, cases of men who are well-to-do, but these are cases which are comparatively few, and I do not think, for the sake of eliminating a small number of farmers, we should have this restriction and impose the labours on the department which would be necessary for this. Then the hon. member suggested that parties to a mortgage bond— the bondholder and the debtor—should have the power by agreement to contract themselves out of Clauses 6 or 7. That is a point which has been considered, but it is thought it would be dangerous to put in a clause of that kind, because a debtor might be coerced by a bondholder to agree to this when it was not his intention to do so. There were other points raised by the hon. member which I expect to deal with on the amendments when we come into committee. The point which he raised in regard to the collection of the subsidy is a very important one. He suggested that the bondholder should be able to get the whole 5 per cent from a farm. He should not be under an obligation to get 3½ per cent. from the farmer and then spend some time in getting 1½ per cent. from the Government. That point has been raised by the trust companies and no doubt it is a point to be considered, but I think we should be able to make regulations by which that dimculty will be to a large extent overcome by requiring the debtor before he pays the 3½ per cent., to give a certificate that this is a mortgage which is entitled to the l½ Per cent. That will enable the bondholder to get immediate payment of the l½ per cent. The hon. member for Fort Beaufort (Mr. Hockly) suggested that there would be a different way of what he calls “rehabilitation,” and that there should be some method for the redemption of capital debts. Nothing is more difficult than to find some plan of reducing the capital burden of debt. I do not say that if the dislocated state of primary products’ prices continues, some wider scheme of debt relief may not have to be undertaken, but I do not think we are in sight of that yet. I can see the difficulty that might arise where farm bonds have been ceded to the banks as collateral security for an overdraft, but as the Prime Minister said we are not prepared to introduce legislation. I know a great many complaints have been made that the rates charged by the banks on overdrafts are out of all proportion to the interest they allow on fixed deposits. I propose discussing this matter with the banks in order to see whether something cannot be done to meet the general public feeling in that direction, but we do not propose to legislate. T have referred to the criticisms of the hon. member for Fort Beaufort, which are perfectly legitimate, but they ask us to do more than we are prepared to do. They ask us to go further and make provision for a general writing down of debts, and we are not prepared to do that. The hon. member for Piquetberg (Mr. de Waal) put forward the same point, that a redemption fund should be constituted at 2 per cent., but who is to provide that fund and how are we to know that the farmers would not incur fresh debts? If they did we should have a revival of the same trouble. We do not propose to go further there and we do not propose to go as far as a general reduction of interest by law. That would be interfering with private contracts on a far wider scale than anything contemplated now. This should be limited to the actual needs of the times and to the steps which we consider will have the effect of maintaining on the land and in their position, men who are not past hope of salvation from the financial point of view. I think all the other matters can be dealt with when we go into committee, and I nope any hon. members who want to move amendments of any importance will put them on the paper so that other hon. members may have the opportunity of studying them.

Motion put and agreed to.

Bill read a second time; House to go into Committee to-morrow.

I move—

This is the ordinary Income Tax Bill for the year. It imposes income tax and supertax on the same scale and on the same basis as last year without any material alteration. Tn regard to the surtax on interest, it restricts the surtax to interest exceeding 5 per cent., and imposes the surtax on interest above that limit by a flat rate of 5 per cent. With regard to companies, there is an amendment of the existing income tax; for example, Clause 3 makes an amendment in regard to the definition of private companies in relation to their liability to super tax. The effect of the amendment is this: that the private company under the existing law is treated as a public company if it has distributed in dividends during the year not less than 75 per cent. of its assessment for supertax. This amendment is to the effect that it is regarded as a public company if it has distributed in dividends 75 per cent. of its income subject to supertax, that is, even if there is no actual assessment of supertax. The next clause deals with the distribution of income tax as between the beneficiaries of an estate and provides that the tax shall be charged in respect of the share of each beneficiary in the estate, and not in respect of the income of the estate as a whole. The other clauses are machinery clauses which I do not think I need trouble hon. members with. If any points arise, I shall be pleased to deal with them in committee.

Motion put and agreed to.

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

House in Committee:

On Clause 2,

I have some difficulty in regard to this clause, although I do not know whether it is well-founded, but the Minister will probably be able to explain. This surtax is on fixed interest as defined in the Act of last year, and the Act of last year includes the following in the definition of fixed interest: Mortgage bonds, debentures and debenture bonds. Therefore, the interest from any mortgage bonds comes under the definition of fixed interest, and is consequently liable to the surtax. Now there is also to be a special surtax on certain classes of mortgage bonds. Anything over 5 per cent. is subject to the surtax as laid down. Now in this Bill you are levying 5 per cent. interest on all bonds bearing interest over 5 per cent., including farm bonds. Tn practice the Minister hopes that the result of the other Bill of which we took the second reading this evening will be to reduce the interest on all farm bonds to 5 per cent. The Minister hopes that the holders of all bonds will voluntarily reduce their interest to 5 per cent., and if that is done there is no trouble. But supposing they do not agree to that. Supposing they say: “No, we are not prepared to reduce our rate of interest.” Supposing they still want their 7 per cent. There is nothing to compel them to take less than 7 per cent. The only thing is that they have to hand 2 per cent. over to the Government. It would appear that they would first of all lose the 2 per cent. under the Act which we have already passed the second reading of, and then they would lose 5 per cent. of their 7 per cent. under this Bill. I think I am right in the point I am taking. It may not be of practical importance, because the Minister hopes that all bondholders will reduce their rate of interest, in which case, of course, the point which I am taking falls away, but if the rate of interest is not reduced, then the unlucky holder of a farm mortgage will not only lose his excess over 5 per cent., but he will have to pay surtax under this as well.

I think the hon. member is mistaken about that. Under this Bill we have just read a second time, I should imagine that the bondholder’s income tax return would show that he had received 7 per cent., less 2 per cent. Anyhow, we can make the point clear. I do not think it is right that a man should lose the 2 per cent., and then have to pay supertax on it.

I take it that the difference in the amount between 5 per cent. and the amount paid as interest in excess thereof would not be taken into account for income tax purposes.

If the Minister accepts the amendment referred to by the hon. member for Cape Town (Gardens) (Mr. Coulter) that will overcome the difficulty. However, I will leave the matter for the consideration of the Minister.

Clause put and agreed to.

On Clause 7,

Apparently this clause is permissive, as it says—

Will the Minister explain in what case this will operate?

It is intended to operate by agreement with the gold mining companies, so that they can pay us half-yearly if they wish.

I take it that if the commissioner demands these half-yearly returns the mines have to make them? It is a very onerous task to compile these returns, and involves a great deal of labour. This may be throwing a lot of unnecessary work on the gold mining companies.

I am informed that this sub-clause is introduced by agreement with the mining houses. The object is to spread the revenue more equally over the financial year.

Clause put and agreed to.

Remaining clauses and title having been agreed to,

House Resumed:

Bill reported without amendment and read a third time.

I move—

Last year this matter was referred to the Select Committee on Railways and Harbours. We went into it, and made this recommendation. The reason why the adoption of the report is proposed is that the railway administration is desirous of acting in conformity with the recommendation, but this cannot be done unless Parliament does not take a decision on it. It affects the request of the Zebediela Estates that part of its debt to the railway administration is to be written off in respect of the guarantee of the railway line from Singlewood to Zebediela. The Select Committee on Railways and Harbours decided by a majority of votes not to recommend the writing off. The company has given a guarantee, and I may say that they have fulfilled the terms of it. But the loss was more than the guarantee given by it, and the company has only asked to write off in respect of the additional loss. The bank guarantee is for £3,000 per year, but the loss was more. The company had to make a monthly payment of £500, and the Select Committee on Railways now recommends to reduce this amount to £250 per month. It is only this recommendation which is before the House to-night. The railway administration is prepared to meet the company and to accept the £250 per month. They are only waiting for approval of Parliament. I therefore ask that this recommendation of the select committee, of which the railway administration approves, be accepted by the House.

Mr. R. A. T. VAN DER MERWE seconded.

The administration is quite prepared to accept the suggestion of the committee, but I should like to emphasize again that the administration is not prepared in any way to release the guarantee, and they are only prepared temporarily to reduce the amount from £500 to £250. That is the suggestion of the committee, which we accept, but I should like it to be perfectly clear to the petitioner that those are the conditions, and that the administration intends to maintain them.

Motion put and agreed to.