House of Assembly: Vol3 - WEDNESDAY 21 MARCH 1962

WEDNESDAY, 21 MARCH 1962 Mr. SPEAKER took the Chair at 2.20 p.m. ESTIMATES OF EXPENDITURE FROM CONSOLIDATED REVENUE FUND

Budget Speech, 1962

The MINISTER OF FINANCE:

I move—

That the House go into Committee of Supply on the Estimates of Expenditure to be defrayed from the Consolidated Revenue Fund during the year ending 31 March 1963, and into Committee of Ways and Means on taxation proposals.

A country’s Budget is primarily, although not entirely, an economic document. Unless a country is itself socially and politically perfect in a socially and politically perfect world, its Budget must feel and show the impact of the socio-political atmosphere within which it operates. To ignore this atmosphere and to divorce a Budget from the socio-political considerations in which it is begotten, may be a useful economic exercise, but it must at best result in a Budget which is “faultily faultless, icily regular” but “splendidly null, dead perfection, no more”.

In South Africa under present-day conditions, socio-political considerations must therefore carry great weight. What are these conditions? It is obvious that the Republic is under fire on various fronts. More, it is under cross-fire. We draw fire from one quarter by reason of the fact that South Africa is the chief obstacle in the way of the attainment of Communism’s designs on Africa. We are the main bastion of the West in this troubled continent—guarding the sea-route to the East. Therefore our people and our peace must be disrupted and our resistance shattered to pave the way for the final communistic conquest of Africa.

From another direction also, and from different motives, South Africa is under fire, under threats of violence and disruption. Under the banner of “Africa for the Africans”— Black Africans of course—covetous and hostile eyes are trained upon us. What we have done and are prepared to do for emerging Africa and our own Blacks is dismissed as of no consequence. Our desire for peaceful and co-operative co-existence in Africa is ignored, as well as the great need for the orderly development of Africa, politically and economically.

There is a large extent of interplay between these twin hostile forces, for, true to character, Communism seeks to inspan others to attain its objectives.

It seems unrealistic, except in a “hot” war against Communism, to look for assistance to those countries who speak our accents and share our beliefs, but in whose global strategy it would appear to be more important to appease uncommitted countries than to stand by old friends who have already declared in their favour by deeds and not only in words. These facts are a warning that we should look to our defences, against aggression from outside, but also against lawlessness and subversion from within. These are facts which a realistic Budget can ignore only at the country’s peril.

The accelerated development of the Bantu homelands is another socio-political duty which we dare not shirk. Firstly, because it is our moral duty to promote the economic and political development of the Bantu in their own areas; and sceondly—but only secondly— because we may thereby be able to convince those not blinded by prejudice that our policy of separate development is no sham, but a sincere attempt to solve, with justice to all and in the interest of all, a problem which in other countries has failed to find a satisfactory solution.

This Budget is planned with due regard to these weighty socio-political considerations; but however important they are, that does not mean that economic considerations can be neglected. In any modern economy the Budget is a significant element in economic policy— perhaps not so all-important as is sometimes believed, but still significant. The expenditures of the Government, and the taxes and other revenues to be raised, must be considered in the light of their effects on the economy, and may indeed be adapted to promote positively the progress of the economy.

In planning a Budget, as in planning a military operation, it is advisable to begin with a systematic appreciation of the situation. Such an appreciation should first of all define the aim or objective of the operation, and then examine the various factors affecting the attainment of that aim before considering the various courses of action open.

The aim of the Budget-planner is always complex, but in present-day South Africa I think it can be reduced to three main elements. These are—

  1. (1) security against external attack, as well as against internal disorder, for all races in the Republic;
  2. (2) the greatest possible degree of economic progress and stability, within the context of general government policy; and
  3. (3) the alleviation of the lot of the handicapped and other less fortunate members of the community, to the extent that our resources permit.

This Budget must therefore be judged as a financial plan of campaign to attain these aims.

Before developing my plan, it is necessary to look at some of the main factors which are likely to affect any proposed financial plan of campaign. Some of these factors are factual, whether in the Republic or outside; but others are reasoned conjectures from known data and tendencies. As in military science, financial diagnosis and forecasting must sometimes proceed from the known to the unknown. I have thought it advisable to furnish the House with a field map of the known terrain in the shape of a revised and enlarged White Paper, which I shall presently lay upon the Table. I hope that this will assist hon. members in studying the background of the plan of campaign. It will also enable me to avoid over-burdening the Budget speech with detailed statistics, since the figures are available in the White Paper.

_I shall begin with a survey of—

The Balance of Payments:

The spectacular recovery of our gold and foreign exchange reserves since their low point in June 1961 is the main feature in the economic history of the past year. After an initial rise in the first quarter of 1961, the reserves fell sharply, so that between 1 January and 30 June they showed a net decline of R18,000,000. In the second half-year, however, they improved by no less than R125,000,000. This recovery was due, in the first place, to a sharp drop in imports; secondly, to the checking of the outflow of private capital, and thirdly, to an encouraging increase in merchandise exports and gold production.

Over the year as a whole our imports decreased by R116,000,000 or about 10 per cent as compared with 1960. This was due not only to the intensification of import control, but also to the diminished demand for imported goods as a result inter alia of tighter money conditions in the first three-quarters of the year, and to the fact that inventories had already been replenished in 1960. I do not think there can be any complaint that the reduction in imports has caused any noteworthy shortages or any marked inflationary tendencies in the economy.

Merchandise exports reached the record figure of R926,000,000—R47,000,000 or 5.3 per cent above the 1960 figure—despite a fall of R29,000,000 in uranium exports as a result of the new “stretch-out” arrangements. So much for boycotts! According to preliminary figures, exports of wool rose by R13,000,000, of maize by R18,000,000, and of diamonds by R15,000,000, while re-exports (also largely diamonds) increased by R17,000,000.

Gold production again showed a most satisfactory increase to reach a new record level of R576,000,000 for the year. Net payments for services, however, also increased substantially, reflecting mainly increased remittances of profits and dividends abroad, particularly during the first half of the year.

The balance of payments on current account accordingly showed a net surplus of R205,000,000 for the year 1961, of which R175,000,000 was attributable to the second half-year. This compares with a surplus of R21,000,000 for the year 1960.

On capital account, official and banking institutions were responsible for a net outflow of R11,000,000 in 1961, representing the excess of loan repayments over new loans received. There was a net outflow of private capital to an amount of R72,000,000, as compared with R152,000,000 in 1960. By far the greater part of this outflow, namely R56,000,000, occurred in the first half of the year. The purchase of South African securities from non-residents, which caused a net outflow of R28,000,000 during the first half of 1961 (as compared with a net outflow of R78,000,000 in 1960), was effectively stopped by the measures announced in June of last year. Moreover, substantial new foreign loans received by the private sector during the second half of the year offset to a large extent the contractual repayments of uranium and other loans as well as a further moderate outflow of South African resident capital, mainly for direct investment. The final outcome was that the Republic’s total gold and foreign exchange reserves increased over the year 1961 by R107,000,000—a most satisfactory result.

Since the end of 1961 the reserves have continued to rise. In this period we have repaid our entire drawing from the International Monetary Fund (approximately R27,000,000), which is the equivalent of our gold subscription to the Fund. Stand-by credits in respect of our first and second credit tranchés and amounting to a total of R54,000,000 were also granted by the Fund, but it was not found necessary to avail ourselves of any part of these credits, and in fact the second credit tranché was relinquished by us some time ago. We have also repaid a further $10,000,000 (approximately R7,000,000) of our revolving credit with a group of American banks. A previous repayment of $10,000,000 was made last December so that $20,000,000 is available to be drawn again at any time if it should be needed. Despite these repayments, the Reserve Bank’s gold and exchange reserves stood last Friday at R313.9 million or R37.3 million higher than at 31 December 1961.

The prospects for the current year, barring unforeseen events, are generally favourable. Gold production should continue to increase, though perhaps not quite so rapidly as in recent years. Economic conditions in most of our principal markets should be conducive to at least the maintenance of our merchandise export trade at the 1961 level. We have to meet substantial repayments on official and private overseas loans, but at least some of these have either already been renewed or are likely to be renewed, while new foreign loans may again be raised during the year. The reserves will, of course, not continue to rise indefinitely, and may indeed decline temporarily during the seasonal lean period ahead, but that is no cause for concern, because the underlying trend is sound.

This improvement in the balance of payments inevitably gives rise to speculation regarding the relaxation of import and exchange controls. The events of the past two years have shown, however, how necessary it is for us to be armed against any sudden attack on this economic flank, and I think we shall be well advised to aim at maintaining our gold and foreign exchange reserves at a higher level in future.

This does not mean that no relaxations are possible. As regards import control, I think that the situation justifies and indeed requires a limited relaxation, and I have therefore agreed to make an additional amount of foreign exchange available for this purpose. My colleague, the Minister of Economic Affairs, has recently made an announcement in this connection. I would emphasize that it is the Government’s policy, when relaxing import control, to do so gradually and with circumspection so as to cause no undue disturbance to local industry.

The exchange restrictions imposed last June on the transfer of the proceeds of securities sold in South Africa by a non-resident were reluctantly resorted to as an emergency measure. It would be premature and dangerous, however, to lift them completely at this stage. The appreciable difference between the prices of South African shares on the Johannesburg and London Stock Exchanges, is an indication that many foreign investors still do not share the confidence of South African shareholders in the future of the Republic, and that, if all restrictions were lifted, any unfavourable incident might lead to a renewed outflow of capital. There are, however, certain steps which we can take and which will benefit the foreign investor and possibly reduce to some extent the gap between London and Johannesburg share quotations, without at the same time placing our balance of payments position in jeopardy. I shall deal with these steps later.

Let us now turn to look at the field of

Domestic Economic Activity:

According to preliminary estimates, the net national income for the 12 months ended 30 June 1961, amounted to R4,271,000,000—an increase of 5.7 per cent over the revised figure of R4,040,000,000 for the previous year. This increase is smaller than that of 1959-60 but is not unsatisfactory for a year in which the South African economy had to cope with many adverse influences. The increase for 1960-1 was fairly evenly spread over the main sectors of the economy: the net income of private manufacturing industry rose by 6.1 per cent, of mining by 5.6 per cent, of agriculture, forestry and fishing by 3.7 per cent, and of commerce also by 3.7 per cent. The available information suggests, however, that the internal economic situation took a less favourable turn from the second quarter of 1961 onwards. I shall not weary the House with the statistics, which are available in the White Paper and other official publications, but there are a few aspects of the situation which I should mention.

During the year 1961 unemployment tended to increase, notably in the building, motor and engineering industries. After reaching a peak in August it declined slightly, but rose again in January and February 1962, when large numbers of school-leavers were seeking work.

The building industry, which is one of those in which unemployment has increased, is likely to present special problems. The value of building plans passed dropped sharply in the second quarter of 1961, and for the year as a whole declined by 28 per cent compared with 1960. Though some temporary factors were at work causing hesitancy in undertaking new building works, I think it must be recognized that office accommodation, and to a lesser extent dwelling accommodation, is in many centres reaching saturation point, so that the building industry may have to adjust itself to a somewhat lower level of activity for some time.

Rough preliminary estimates indicate that, for the calendar year 1961, the gross national product increased by only about 3 per cent above 1960. There was a small increase in consumption and a substantial increase in saving, and private sectors, but net private fixed investment increased moderately in both the public and private sectors, but net private fixed investment showed little change. The comparatively slow rate of growth of our economy, as measured by real income per head, and the sluggishness of net private fixed investment, remain a source of concern. It is true that similar growth rates are found in other countries at a comparable stage of development, such as Australia and New Zealand, and no doubt this is associated with some deterioration in the terms of trade of primary producing countries in recent years. But, with our wealth of natural resources, I think that we can and should show more rapid progress than we have done in the past few years.

There are, however, many bright spots in our economy. In many branches of activity, notably in gold mining and in our export trade, there has been a substantial advance. Agriculture has, on the whole, had a reasonably good year, though certain sections are burdened with the problem of surpluses. In business generally, profits appear to have increased; a survey of 271 companies with financial years ended 30 June 1961 conducted by the Bureau of Census and Statistics, showed an average rise in profits, before tax, of 10.7 per cent.

Some experienced observers consider that a revival of capital development in the private sector is already under way, and there is some statistical evidence that economic conditions did in fact improve in the past few months. The gross national product, for example, after showing little change in the second and third quarters of 1961, rose again in the fourth quarter, and this increase was reflected particularly in increased consumption. After allowance for seasonal fluctuations, the indices of fixed property transactions and of employment in private construction industry turned upward during the last few months of 1961, while bank debits tended to increase more rapidly.

On the financial side, the liquidity of the economic system is now such as to permit of a reasonable measure of expansion. When the outflow of capital reduced the foreign reserves to their low point about the middle of 1961, considerable financial stringency was experienced. The subsequent rise in the reserves led to a substantial easing of the position, so that over the year 1961 the private sector’s total liquid assets increased by R140,000,000 to the record level of more than R1,600,000,000. Similarly, the liquidity of the commercial banks has improved over the year; the ratio of their liquid assets to liabilities to the public, which stood at 43.2 per cent at the end of 1960, fell to a low point of 35.4 per cent at the end of June and then recovered rapidly to 47.6 per cent at the end of December 1961.

Interest rates have reflected these movements in liquidity. Thus the Treasury bill tender rate, after increasing from 3.90 per cent at the end of 1960 to 4.73 per cent on 9 June 1961, decreased thereafter to 4.03 per cent by the end of the year; last Friday it stood at 3.68 per cent. Bank rate was reduced by ½ per cent on 7 December to its present level of 4½ per cent. This latter reduction was followed by a similar movement in the rates charged and offered by commercial banks and, more recently, in those to be offered by building societies. As regards long-term interest rates, the Reserve Bank’s pattern of rates for Government stock which was increased by ¼ per cent in February 1961 and again by ¼ per cent in May, has since remained unchanged, but the results of recent public loan issues by municipalities and public utility corporations indicate that the pressure on the capital market has eased considerably.

The general conclusion from this brief reconnaisance of the economic sector is that our forces are well deployed and in good fettle, and that they have stood their ground resolutely and well against the shock attacks of the past year. Conditions are now favourable for an advance on this front. The question is whether, in the light of the demands of other sectors, it will be possible to devote any fiscal resources to speeding this advance.

From the national accounts, I now turn to the Government’s accounts for—

The Financial Year 1961-2:

It is estimated that the Revenue Account for the year ending 31 March 1962 will close with a small surplus of about R5,000,000. Expenditure is likely to be at about the same level as originally estimated, but whereas customs and excise receipts will be somewhat lower than forecast in my Budget speech last year, inland revenue—mainly income tax—is expected to be appreciably higher.

On Loan Account, expenditure during 1961-2 will be considerably less than originally estimated, principally because of lower capital expenditure by the Railways. Furthermore, the Loan Account started the year with a credit balance of nearly R27,000,000, mainly because the Railways Administration did not require its full allocation in the previous financial year. These and certain other favourable factors enabled the Treasury to repay to the Reserve Bank recently the counterpart of the $40,000,000 revolving credit from a group of American banks, and still to end the year with a credit balance.

The Loan Account for 1962-3 must now be surveyed.

The Estimates of Expenditure on Loan Account submitted by Departments amounted to R242,000,000. With the co-operation of the Departments concerned, the Treasury was able to reduce this amount to R218,000,000— R12,000,000 less than the main estimates for the current year.

Further progress with the Railways’ capital programme has made it possible to reduce the provision for this purpose by R15,000,000, as compared with the provision for 1961-2. A decrease in the requirements for assistance to farmers has enabled the provision under Loan Vote H to be diminished by nearly R5,000,000. There is also a reduction of R2,000,000 in the provision for Housing and of a similar amount under the Commerce and Industries Vote for the Industrial Development Corporation. On the other hand, I have provided R4.9 million more for the Provincial Administrations, mainly for schools and hospitals, and R4.5 million more for Water Affairs. There is also an increase of R1.5 million in the provision for Community Development and of over R1,000,000 for Telegraphs, Telephones and Radio Services. These decreases and increases account for a net decrease of R12,000,000 in the amount requested by Departments on Loan Account.

In Vote E—Water Affairs—there is included an amount of R2,000,000 as a first instalment for the Orange River Development Project. The Orange River, Mr. Speaker, is one of our most valuable assets, and yet, by reason of the large variations in its flow from year to year and from season to season—which is not properly controlled—it causes periodic flood damage. Moreover, 80 per cent of its water runs unused into the sea.

By the turn of the present century our population will have doubled. This calls for a steady expansion of food production. Likewise rural development, the decentralization of industry, and the provision of rail transport facilities, will generate an increasing demand for electric power.

The need for harnessing the Orange and utilizing its great potential is obvious. Investigations by the Department of Water Affairs reveal that—leaving out of account the waters of the Vaal which are needed in its own catchment area—it should be practicable, by providing sufficient storage capacity, to ensure a reasonably continuous and controlled flow of 1,600,000 morgen feet per annum, and to apply this to the irrigation of 360,000 morgen of land as well as to the supply of certain quantities of water for power generation and domestic purposes.

This great project, involving a series of storage dams, a 50-mile tunnel, several hydroelectric power stations and hundreds of miles of irrigation canals, will take many years and many millions of rand to complete. Even the first phase, upon which we now propose to embark, is estimated to cost R85,000,000. But, Sir, water is our life-blood, a vital but scarce resource essential to ensure for future generations adequate food supplies, and we should fail in our duty if we did not start now to develop this asset. Posterity will appreciate the tremendous significance of this step.

Until a few years ago, the grant to the South African Native Trust Fund for the purchase of land and for the development of the Bantu areas was always voted on Loan Account. In 1958 it was transferred to Revenue Account, on the ground that it did not result in the acquisition of permanent assets by the central Government as such. There can be no doubt, however, that a very large proportion of this expenditure results in the creation of permanent assets for the State in the wider sense, and in view of the much larger amounts now being provided for the Trust, I feel that, in present circumstances, the present generation of taxpayers should not be asked to bear the whole burden. I have, therefore, included an amount of R10,000,000 for this purpose on Loan Account. A considerably larger amount is, in fact, expected to be spent by the Trust on the creation or acquisition of permanent assets in 1962-3, so I consider that there is ample justification for this step. Further details of the Trust’s proposed expenditure will be given when I deal with the Revenue Account.

The total amount included in the Loan Estimates is therefore R228,000,000. In addition, R1,200,000 is required for a further contribution to the International Bank for Reconstruction and Development, R800,000 for an advance to the Bantu Education Account, and R1,000,000 in respect of the cost of raising loans.

External loans to an amount of R33.2 million and internal stocks amounting to R33.6 million must be repaid, while the loan levy of 1957-8 amounting to R18.6 million also falls due during the coming financial year. A total of R316.4 million is therefore required.

The following funds should be available:

R

Credit balance on Loan Account at April, plus amounts surrendered from 1961-2 financial year

18,000,000

Loan receipts and investments by Public Debt Commissioners

142,600,000

Revolving credit with American Banks

28,600,000

Balance of Export-Import Bank Loan

1,500,000

Balance of World Bank Loan

1,700,000

R192,400,000

An amount of R124,000,000 must still be found.

I think it is reasonable to hope that we shall be able to arrange new foreign loans, or the renewal of existing loans, to an amount of R35,000,000.

As regards internal stocks, a loan of R29,449,000 falls due next month, and the Treasury will issue two new loans, one for 20 years at 5⅞ per cent and one for 5 years at 5¼ per cent. In view of the easier trend in the capital market, I think it should be possible to raise R40,000,000 by this issue and, if necessary, by a further stock issue later in the year. In other words, we do not envisage taking more than about R7,000,000 in new money from the capital market.

Last year I re-introduced the special 5 per cent tax-free Treasury bonds, and this issue will be continued. At present these bonds have a life of seven years, but can be repaid after five years at a discount of 2 per cent. To increase the popularity of these bonds, I propose to abolish the discount, so that the bonds (including those already issued during the current financial year) will be repayable at par, at the option of the holder, at any time between five and seven years from the debate of issue. These bonds should yield R6,000,000.

I mentioned earlier that there were certain measures which could be taken to relax the exchange controls on the transfer of the proceeds of South African Securities sold in South Africa by non-residents. After careful consideration of various proposals, the Government has decided upon two measures, both of which, apart from the benefits they confer upon foreign shareholders, will also be for the benefit of the State and thus of the country as a whole.

Only the first of these measures has a direct bearing on the Loan Account. The Government intends to permit holders of “Blocked Rand” to subscribe to a special issue of five-year non-negotiable Government bonds, bearing interest at the rate of 5 per cent per annum and repayable in five annual instalments, reckoned from the date of subscription by the parties concerned and freely transferable in foreign currencies on the expiry of each instalment. The amount which could be so subscribed, however, will be limited to R20,000,000 during the financial year 1962-3, but the ultimate limit contemplated at present would be R50,000,000. This would enable existing holders of “Blocked Rand” and non-resident holders of South African securities who desired to sell such securities on the Johannesburg market, to repatriate their capital, if they wished to do so, on the expiry of each instalment, at the ruling official rates of exchange. Further details of this loan will be announced in due course.

The second measure which, as I have implied, does not directly affect this Budget, has been prompted by the desire to alleviate the shortage of scrip available to South African investors. Since the breaking of the link between the Johannesburg and London Stock Exchanges, South African investors have sometimes found it difficult to obtain sufficient share investments on the local market. This has also had the effect of driving up share prices in Johannesburg and widening the margin between these prices and those quoted on the London Stock Exchange. Representations have, in fact, been made to me by persons desiring to start open-end trusts under the legislation recently passed by Parliament, that the establishment of such trusts will be very difficult, if not impossible, unless they can obtain more adequate supplies of appropriate scrip than are obtainable locally.

The only solution is to purchase the scrip on the London market. But such purchases must obviously be strictly controlled, otherwise the drain on our foreign reserves may become too great. Moreover, I feel it would be wrong to permit a limited number of local investors to reap any profit arising from the margin between the London and Johannesburg prices of the securities purchased.

The Government therefore intends to arrange with the Reserve Bank, as its banker and agent, to receive applications from approved financial institutions in South Africa for the purchase on their behalf of South African shares on the London market. The Bank will buy these shares to the best advantage and will deliver them to the South African institutions at a price agreed upon in advance, which will generally be the current market price quoted on the Johannesburg Stock Exchange on the date the order was placed. Further details will be announced in due course. The total amount of such orders accepted will be limited, and the limit will be fixed from time to time by the Treasury in accordance with the position of the balance of payments and the state and trend of the Johannesburg share market. A limit of the order of R20,000,000 or R30,000,000 is at present envisaged.

The question remains: what is to be done with any fortuitous profits arising from these transactions? Clearly they should not benefit any individual or any group of individuals, and it might be invidious to assign them to any charitable or educational cause. I think justice will be best served if such profits, if any, should be credited to the Defence Special Equipment Account, since the defence of South Africa is the concern of every individual citizen of the Republic.

These two measures have, I think, several advantages over other devices which have been suggested. They will furnish greater scope for the overseas investor who wishes to realize his investment; they will provide for a controlled repatriation of South African securities and consequently a reduction in South Africa’s foreign liabilities in respect of portfolio investments; they will alleviate the shortage of scrip on the local market; they may tend to cause, without any disruption of the local market, a narrowing of the gap between share prices on the Johannesburg and London Exchanges, and they will confer some financial benefit on the State and hence on the country as a whole.

I return to the Loan Account. To meet the gap of R124,000,000, we should have available R35,000,000 from foreign loans, R40,000,000 from local loans, R6,000,000 from tax-free Treasury Bonds, and R20,000,000 from the special “Blocked Rand” loan. There remains a balance of R23,000,000. The volume of Treasury Bills outstanding has increased over the current year, but is still below the level of two or three years ago. Provided the liquidity of the money market does not deteriorate seriously I see no difficulty in raising the additional money required by the issue of Treasury Bills.

From the known I now proceed to the unknown terrain and offer estimates of—

Expenditure on Revenue Account, 1962-3:

The printed Estimates show a total provision on Revenue Account of R790.8 million, approximately R70,000,000 higher than the main Estimates for 1961-2. Of this increase, Defence is responsible for no less than R48,000,000.

Mr. Speaker, this is a Budget of national security. Defence is at once its dominant theme and its ultimate justification, and yet I do not think it is necessary to say very much about defence here this afternoon. South Africans have always been ready to make sacrifices when their national security is threatened. I do not say that our national security is actively threatened now, but I say that it very soon will be, unless we are strong enough to deter a potential aggressor. I say further that such a threat, under whatever guise and from whatever quarter it is launched, bodes no good in the long run for any racial or political group in South Africa, unless it be the small group of communist-inspired agitators who thrive on anarchy and chaos. It is the duty of us all, therefore, to strengthen our defences—already far stronger than they were a year ago—and to provide our defence forces with the means, not only to ward off attacks, but also to strike back at the aggressor. The ability to retaliate is the best guarantee that retaliation will never be necessary.

Defence expenditure is the premium which a country pays on a policy for peace. Si vis pacem, para bellum. South Africa should not only be prepared for the eventuality of aggression, but it should also appear to be prepared. And who grudges the accident premium if no accident happens?

It is with confidence, therefore, that I ask the House for an amount of nearly R120,000,000 on the Defence Vote, or 67.3 per cent more than in the Main Estimates for 1961-2. Hon. members will not expect me to give details of the Vote this afternoon; my colleague the Minister of Defence will do so, so far as this is compatible with the public interest, in the Committee of Supply.

Excluding Defence, the total amount asked for by Departments on Revenue Account exceeded the current year’s estimates by R42.1 million or 6.5 per cent. With the whole hearted co-operation of my colleagues, this increase was reduced to R31.7 million or 4.8 per cent, even before the transfer to Loan Account of R10,000,000 of the provision for the Native Trust. This is the more remarkable if it is borne in mind that certain increases, for example, in the provision for interest on the public debt (R6.3 million) are unavoidable, while others such as the increase for Police (R2.4 million) are essential for maintaining internal security.

I would also draw attention to the increase of R5.6 million in the provision for Provincial Administrations. Statutory provincial subsidies amount to the formidable figure of R136.7 million, and at the urgent entreaty of the Provincial Administrations concerned, I have increased the extra-statutory subsidies in the Estimates to no less than R8.9 million. It is most unsatisfactory that we should have to deal with the question of Provincial subsidies on this ad hoc basis, and I sincerely hope that the Commission now studying this problem will be able to find an acceptable solution.

I should also like to refer to the grant-in-aid for the South African Native Trust. During the year 1961-2 R17.5 million was provided for this purpose. Despite very rapid progress by the Department of Bantu Administration and Development, some R5.5 million of this amount will probably remain unspent at 31 March 1962. The Department is now pushing forward with its development plans for the Bantu Areas at full speed, and for the year 1962-3 expects to require no less than R25.2 million, or more than double the amount expected to be spent in 1961-2. Of the R25.2 million, R2,000,000 is needed for the purchase of land, R8.1 million for the establishment of villages, R1.8 million for irrigation and water supplies, R1.7 million for soil reclamation, R2,000,000 for forestry development, R1.9 million for buildings such as agricultural schools, youth camps, etc., R1,000,000 for machinery and equipment and electricity supply, and R6.6 million for general development. To obtain the R25.2 million it is necessary to supplement the unspent balance of R5.5 million by voting R19.7 million, of which R10,000,000 is included in the Loan Estimates and R9.7 million on Revenue Account.

There are a few new items of expenditure which I propose to include in the Supplementary Estimates. The first concerns—

Assistance to Exporters:

In order to strengthen our balance of payments, it is important that we should build up our export trade. I think that many potential exports are lost to South Africa, simply because our manufacturers and merchants have not the experience and knowledge to break into world markets; the products and the prices are right, but the marketing technique is lacking. There may be need for some machinery to assist exporters in these matters. Private industry and commerce should play their part in such an effort, but the Government is willing to do its share.

An Exporters Convention is to be held in Johannesburg in May, and the Government will await the results of this Convention before deciding upon the exact form of its contribution. As an earnest of our willingness to help, however, I propose to include an amount of R500,000 in the Supplementary Estimates for this purpose.

Social Pensions:

The third aim which I set myself in planning this Budget, was the alleviation of the lot of the less fortunate members of the community, to the extent that our resources permit. It is clear that it is no easy matter to set aside any considerable sum for this purpose at this time. Nevertheless, the Government attaches such a high priority to the needs of social pensioners that I have decided to ask Parliament to vote increased funds for these pensions. It is proposed to increase the bonus paid to White social pensioners and grantees by R18 per annum. Approximately proportionate increases will be made in the case of non-Whites. This increase will mean that the maximum amount payable to, for example, a White old age pensioner will be raised to R294 per annum.

Corresponding increases will be made in respect of maintenance grants and family allowances.

These concessions will take effect from 1 April 1962, and will cost R3,550,000.

War Pensions:

The Government has decided to bring the ratio between White and Coloured war pensions into line with the ratio between White and Coloured social pensions, by increasing the pensions and allowances payable to Coloured ex-servicemen and their widows and dependants. This will mean, for example, an increase of R72.50 per annum in the pension paid to a 100 per cent disabled Coloured exvolunteer. The additional cost will be R150,000.

Civil Pensions:

Civil pensioners are at present paid a bonus equal to ten per cent of their pensions. This bonus is paid from revenue funds and not from pension funds.

Honourable members no doubt know that the amount of the pension granted to a public servant on his retirement depends not only on the length of his service, but also on his average annual pensionable emoluments over a prescribed period.

The cost of living allowance which was payable to public servants and other Government employees, was partially absorbed in their pensionable emoluments as from 1 October 1953. Total consolidation took place from 1 October 1958.

In order to afford relief to officials who retired before consolidation at a time when salaries—and also pensions—were relatively low, it has been decided to increase the bonus to 20 per cent of the pension in respect of those who retired prior to 1 October 1953, and to 15 per cent of the pension in respect of those who retired between 1 October 1953, and 30 September 1958. These increases will take effect from 1 April 1962.

The pension of a public servant is now based on his average annual pensionable emoluments during the last seven years of his service. Consequently the longer he remains in service after 1 October 1958, the more he benefits from the consolidation of the cost of living allowances and pensionable emoluments in so far as the amount of his pension is concerned.

It is considered that there is no justification vis-à-vis pensioners who retired prior to 1 October 1958—for the retention of the 10 per cent bonus in respect of pensions earned on the consolidated emoluments, and it has been decided to reduce this bonus to 7½ per cent of the pension in respect of officials retired on or after 1 October 1962, but before 1 October 1965, and to 5 per cent of the pension in respect of officials retired on or after 1 October 1965.

Similar changes will be made in respect of widow’s pensions.

It has also been decided that where a pension is paid from a pension fund, that fund shall, as from 1 April 1962, bear a portion of the cost of the bonus by reason of the increased interest now earned by such fund. This portion will be equal to 5 per cent of the pension.

After allowing for this contribution by pension funds, the cost to the Consolidated Revenue Fund of the revised bonuses will amount to approximately R100,000 during the financial year 1962-3.

Total estimated expenditure on Revenue Account, including the additional R3.8 million required for pensions, and the R500,000 for assistance to exporters, is therefore R795.1 million.

The answer to the question how this amount can be met, brings me to the—

Estimates of Revenue, 1962-3:

On the existing basis of taxation, the revenue for 1962-3 is estimated at R754.4 million, or R38,000,000 more than the Budget estimates for 1961-2. The main increases are in respect of income tax on gold mines (R16,000,000), on companies other than mining companies (R6,000,000) and on individuals (R12,000,000), while slightly higher receipts are also expected from certain other taxes and from the Department of Posts and Telegraphs.

Honourable members may have noticed that I did not propose that the surplus on Revenue Account for 1961-2, estimated at R5,000,000, should be transferred to Loan Account, as has been customary in recent years. Since our main problem for 1962-3 is on Revenue Account, I propose that the surplus should remain there.

Taking this surplus into account, the additional amount which must be found is therefore R35.7 million. For whatever comfort it may be, I offer the thought that, but for the increased expenditure under the Defence Vote, there would have been no shortfall of revenue to be met.

In considering the various courses of action open to us to meet this shortfall, we must bear in mind the second objective of our plan of compaign, viz., the greatest possible degree of economic progress and stability, within the context of general government policy. Additional taxation is unavoidable, but we must try to select our tax proposals so that they operate fairly and with the least possible adverse effect on the progress of our economy.

Before dealing with tax increase, however, I wish to propose certain concessions designed to stimulate economic development.

Investment Allowances:

Last year the investment allowances were increased and extended, and I consider that economic conditions justify their continuance at the present levels. Representations have been received that the time allowed for the introduction of new machinery or the erection of new buildings to qualify for the allowance is still too short, and I propose that the existing allowance in respect of equipment and machinery be extended to 30 June 1965, and in respect of buildings to 30 June 1966, provided the construction of the building was commenced not later than 30 June 1965. I can give no assurance that these periods will be extended again next year.

The enhanced investment allowances for the Bantu and border areas will also be continued, for the same periods.

Export Concession:

I have already referred to the need for encouraging our export trade.

In to-day’s highly competitive world markets it is essential that every incentive should be granted to exporters to maintain and expand their exports. I propose, therefore, that exporters who increase their export turnover should, in respect of their expenditure (other than capital expenditure) on the development of export markets, receive a special income tax allowance in the shape of an enhancement of the amount of such expenditure.

The concession will apply in respect of all goods manufactured or produced in the Republic which are exported (excepting gold coin and bullion and uncut diamonds) and also to re-exports where the goods originally imported have been in some way processed in the Republic or have been incorporated, for purposes of re-export, in South African goods. Disposal of such merchandize to ships or aircraft for use or consumption outside South Africa will rank as exports, but sales to South West Africa or the High Commission Territories will not.

The special allowance will be granted in respect of expenditure (other than expenditure of a capital nature) incurred by an exporter (whether manufacturer, producer or agent) during the year of assessment in question in respect of the development of export markets.

Full details of the legislative provisions which will govern the allowance have not yet been finally worked out but it is proposed that the extra deduction will be determined in relation to the increase in the selling value of exports during the year of assessment in question as compared with the selling value of exports during the immediately preceding year of assessment. If such increase does not exceed 10 per cent the extra deduction will be calculated at 25 per cent of the relevant allowable expenditure. If the increase is between 10 per cent and 25 per cent the extra deduction will be 37.5 per cent and if the increase exceeds 25 per cent the extra deduction will be 50 per cent of such relevant expenditure. Various safeguards may have to be incorporated and one of those safeguards will be designed to discourage the splitting of export activities for the purpose of deriving the maximum possible extra deduction.

Since it is hardly probable that exporters could increase their exports significantly during the current tax year by increasing their expenditure on market development, this concession will only take effect from the new tax year beginning 1 July 1962. There will consequently be no loss of revenue during the year 1962-3, but for 1963-4 it may amount to R250,000.

I have endeavoured, by extending the investment allowances and by providing assistance to exporters, to place manufacturers in a position where they can properly plan their production and investment schemes, and I trust that they will rid themselves of any remaining hesitancy and go ahead with confidence and expedition. To those who still allow themselves to be deterred by what they may feel to be a lack of complete security, I would ask: where on this globe do you imagine to find that complete security? Let us grasp the opportunities and build our future in faith and confidence.

Donations to Universities:

In view of the continued pressing need for expanding university facilities for pure science and technology, the concession made in 1960 and extended last year in respect of donations for this purpose will be continued for a further year.

I come now to my proposals for additional taxation. Indirect Taxation was first explored.

Liquor:

My first proposal will, I think, cause surprise only by reason of its moderation. At a time when millions have to be found for our national security, I think it is only fair that the consumer of liquor, in whatever form, should bear his share of the burden, but it will not be a heavy one. I propose that the excise duties on spirits be increased by 18c per bottle; this means that the retail price is likely to rise by 1c per tot. Fortified wine at present bears an excise duty of only 4 5/6c per bottle; I propose that it be increased by a like amount. On sparkling wine, the increase will be 5c per bottle. Unfortified wine at present pays no duty, and it is from many points of view desirable that its price should be kept low, so as to encourage its consumption in preference to spirits. In present circumstances, however, I believe that all who buy liquor, of whatever sort, should be prepared to pay a little more, but the excise duty on unfortified wine will be only 2½c per bottle. On beer, I propose an increase of 12½c per standard gallon for lager beer and 10c per bulk gallon for special beer; in both cases this should result in an increase of not more than 1c per pint in the retail price.

Customs duties on spirits, wines and beers will be increased by equivalent (or, in the case of wines other than sparkling wines, slightly higher) amounts.

I believe that these moderate increases should not unduly affect consumption, especially when account is taken of the proposals to extend the sale of liquor to the Bantu. The additional revenue from liquor duties is estimated at R14.3 million.

Customs duties on non-essential goods:

Last year I increased the rates of import duty on a number of non-essential items. I propose to do the same this year on a further range of items. I do not think the new duties will adversely affect any local manufacturer, but any who consider that they are so affected, may submit representations to the Board of Trade and Industries.

The duties affect a number of items, and I do not propose to mention them all here; details will be given in a Notice of Motion which I shall table. There is one item, however, which I wish to mention, and that is the duty of 5c on paper-back fiction. I am reluctant to impose a duty on books, even if only on paper-back fiction, but anyone acquainted with the enormous volume of trash which enters the country in this form to-day—even in 1954 no less than 6,000,000 such books were imported—would agree that it is not unfair to impose a small duty on such so-called literature. I would have liked to exempt the better class of paper-back fiction from this duty, but it has not so far seemed practicable for the Customs Department to distinguish between the wheat and the chaff. The increase in the retail price of the better class of paper-back fiction should in any case be relatively small.

The estimated additional revenue from all these duties is R1.7 million.

Petrol and Diesel Oil:

It is with some regret that I propose an increase in the customs and excise duties on petrol and diesel oil, since I know that this may affect costs throughout the economy. The increase is, however, a moderate one—1c per gallon—and is indeed the only tax measure in this Budget whose effects are likely to spread, in some measure, to all sections of the community. In the case of diesel oil, the increase will apply only to oil which at present bears customs duty of 12.083c or excise duty of 11¼c per gallon, i.e. diesel oil for use in ordinary road vehicles other than for agricultural purposes or public passenger bus services.

The increased revenue from petrol and diesel oil should amount to R5.4 million.

Gramophone Records:

When duties were imposed on gramophone records three years ago, these duties were graded according to the speed of the records. Technical developments have made it desirable to base the duty rather on the playing time of the records, and representations have been received from the trade to this effect. The proposed basis is fairer in all respects, and I propose that the customs and excise duties on records be changed to the following:

(a)

For each “single-play” record, i.e. a record with a total playing time not exceeding 8 minutes

2½c

(b)

For each “extended-play” record, i.e. a record with a playing time exceeding 8 minutes but not more than 16 minutes

5c

(c)

For each “long-playing” record, i.e. a record with a playing time exceeding 16 minutes

17½c

This is a technical adjustment rather than a revenue measure, but it will yield an incidental additional revenue of about R100,000.

The total additional revenue deriving from indirect taxation is therefore R21.5 million. All these changes in customs and excise duties will take effect immediately. In the case of spirits, wine, beer, petrol and oil and gramophone records, the increased duties will also be payable on such goods not delivered at this moment from the stocks of manufacturers, importers, and distributors and dealers in wholesale quantities, who should take stock of the specified articles immediately.

But direct taxation cannot escape the impost for national security altogether!

Income Tax:

For ten years there has been no general increase in personal income tax; on the contrary, there have been several reductions by way of, for example, higher rebates or discounts. Last year, for instance, the discount on basic personal income tax was increased to 10 per cent. The rate of company income tax has also remained basically unchanged for ten years, except that last year a discount of 3 per cent was allowed. Furthermore, during 1962-3 income taxpayers, both persons and companies, will become entitled to the repayment of 19578 savings levy, amounting to R18.6 million.

I feel, therefore, that when additional funds are required for national security, the income taxpayer will not expect to be forgotten. I accordingly propose to abolish the discount of 10 per cent of the normal tax payable by persons other than companies and of 3 per cent of so much of the normal tax payable by companies on taxable income, other than that de rived from the mining for gold and diamonds, as does not accrue for the benefit of the respective provincial funds.

The estimated additional revenue for 1962-3 is R14.2 million, which is substantially less than the amount of savings levy repayable to persons and companies, viz. R18.6 million.

That concludes my proposals for raising the required additional revenue. There are, however, certain other tax matters to which I wish to refer.

Other Changes:

In pursuance of my policy of rationalizing our tax system, a number of minor changes in the income tax law will be proposed. The most important are:

  1. (1) Royalties on films will be taxed in the same way as other royalties, i.e. tax will be levied on 30 per cent of the gross income instead of the present 10 per cent.
  2. (2) Accumulated losses will be ignored in determining the percentage of dividends to be exempted from normal income tax.
  3. (3) In respect of any divorced or judicial separation granted in consequence of proceedings instituted after to-day, and in respect of any written agreement of separation entered into after to-day, any amount payable by a taxpaper to his spouse or former spouse will not be allowed as a deduction in the determination of the taxable income of such taxpayer, and the amount received by the spouse under such order or agreement will not be taxable in the hands of the recipient.
  4. (4) Retirement gratuities up to a maximum of R4,000 will be exempted from tax.

Full details of these changes will be given when the Income Tax Bill is introduced. The net effect on revenue will not be significant.

Pay As You Earn:

Last year I said that, in spite of certain difficulties, I still hoped that it would be possible to introduce the pay-as-you-earn system of income taxation shortly. I regard this as an important step in the programme of fiscal reform which is now under way. In the meantime the question has become more actual. The Department of Inland Revenue has drafted a possible scheme which has been referred to a Select Committee to allow all interested parties to make representations. I am now awaiting the Committee’s report before deciding whether to introduce legislation to bring the scheme into operation for the 1963 tax year, or whether the matter should be further postponed. Even if the Report is too late for including an acceptable scheme in this year’s Income Tax Bill, it may still be possible to introduce such legislation early in 1963 to bring it into operation for the 1963 tax year.

That concludes my taxation proposals.

It is never a pleasant task to impose additional taxation, but the demands of security are paramount and confer upon me both a duty and a right to ask all sections of the community to make some sacrifices. I have always considered it a Minister of Finance’s duty to give when he can and to take when he must. Defence is this year a “must”. Moreover, the taxpayer will get value for his money. He will pay an extra R21.5 million in indirect and R14.2 million in direct taxes, or R35.7 million in all, but the provision for Defence is actually R48,000,000 higher than the original estimates for the current year and R40,000,000 higher even than the revised estimates for that Vote. When account is taken of the R18.6 million of savings levy to be repaid to taxpayers, it is clear that the additional burden is not a heavy one.

I must point out that the additional amount required from taxpayers will not all be withdrawn from circulation. On the contrary, some 55 per cent of the increased Defence expenditure, for example, will be spent in South Africa, and may indeed have an important stimulating effect on certain sections of the engineering industry. Increased expenditure on the Bantu areas and on irrigation should also boost investment, while the additional expenditure on pensions should give a fillip to consumption. When account is taken of the expansion programmes of the public corporations, to which I referred in my Budget speech last year, and which should soon be gathering momentum, then I feel that this Budget need not exert any undue retarding effect on the economy.

Summary:

I shall now summarise the Revenue Account for 1962-3:

R million

Expenditure as shown in the printed Estimates

790.8

Add provision to be made in Supplementary Estimates for—

(a) assistance to exporters

0.5

(b) concessions to social, war and civil pensioners

3.8

795.1

Revenue on existing basis of taxation

754.4

Add Surplus on Revenue Account, 1961-2

5.9

Increased customs and excise duties on—

Liquor

14.3

Petrol and diesel oil

5.4

Increased customs duties on nonessential goods

1.7

Change in basis of duties on gramophone records

0.1

Withdrawal of discount on income tax—

Individuals

10.2

Companies

4.0

795.1

We should, therefore, end the year with neither a surplus nor a deficit.

Conclusion:

In previous Budgets I have indicated that economic and financial stability demand a flexible monetary and fiscal policy which can adapt itself to changing circumstances, here and overseas.

At times our balance of payments position must be protected; at other times our internal economy should have first priority. Sometimes monetary and fiscal measures have to be relaxed to stimulate development, but sometimes these measures have to be tightened up to preserve stability and ward off creeping inflation. Sometimes fiscal relief is called for; at other times increased taxation. Fiscal and monetary policy must never be an inflexible ramrod which cannot be bent. It should be supple enough to be bent in either direction, depending on the circumstances and requirements of our economy at the time.

A Minister of Finance should be conservative, but not a slave to tradition or hidebound by convention. He should not be a gambler or a chancer, prepared to regard the country’s economy as the guinea pig for fiscal and monetary experiments.

Hon. members will have observed that I did not hesitate to depart from custom in this Budget by leaving the revenue surplus in the Revenue Account instead of transferring it to Loan Account. While we have often financed part of the Loan Account from Revenue, we have never reversed this process, as I am virtually doing in this Budget in regard to the financing of the Native Trust Fund. The financing of Loan Account from Revenue is desirable in certain circumstances and as long as the resulting tax burden remains bearable. By the same token the reverse process may be desirable in a year in which the tax-burden is being appreciably increased.

This is obviously a Budget of national security. At the same time I was not prepared to place the Republic’s financial stability and economic development in jeopardy. I have sought to reconcile these two fundamental requirements, these twin pillars on which the future of South Africa must rest. This Budget represents a synthesis of the demands of national security and financial stability. I am prepared to let it be judged on that basis.

Mr. J. E. POTGIETER:

I second the motion.

The Minister of Finance laid upon the Table:

Estimates of Expenditure to be defrayed from Revenue, Bantu Education and Loan Accounts during the year ending 31 March 1963.

and conveyed to the House for its consideration the State President’s recommendation of the appropriation contemplated in these Estimates of Expenditure.

The Minister of Finance also laid upon the Table:

  1. (1) Estimates of the Revenue to be received during the year ending 31 March, 1963,
  2. (2) White Paper in connection with the Budget Statement, 1962-’63;
  3. (3) Taxation proposals;
  4. (4) Comparative figures of Revenue for 1961-2 and 1962-3:

REVENUE, 1961/62

R,000

Head of Revenue

Revised Estimates

Original Estimates

Increase

Decrease

Customs and Excise:

R

R

R

R

Customs:

Import duties

79,800

71,000

8,800

State Warehouse rent

18

18

Fines and penalties

40

30

10

Bonded Warehouse licences

12

12

10

Miscellaneous

60

70

10

79,930

71,130

8,810

10

Excise:

Spirits

24,700

24,200

500

Beer

7,200

7,200

Cigarettes and cigarette tobacco

47,000

47,700

700

Pipe tobacco & cigars

5,500

5,640

140

Motor cars

14,700

9,400

5,300

Matches

550

660

110

Yeast

360

330

30

Pneumatic tyres (including tubes)

1,570

1,580

10

Motor fuel

7,600

13,600

6,000

Wine

3,000

3,200

200

Gramophone and phonograph records

270

260

10

Paraffin, diesel and furnace oils

1,230

1,800

570

Acetic & pyroligneous acids

20

10

10

Miscellaneous

20

20

113,720

115,600

5,850

7,730

Total for Customs and Excise

193,650

186,730

14,660

7,740

Posts, Telegraphs and Telephones:

Posts:

Postage

21,350

21,760

410

Commission

690

630

60

Box and bag rents

540

540

Ocean Mail Service

800

800

Miscellaneous

1,810

1,510

300

25,190

25,240

360

410

Telegraphs

7,100

7,260

160

Telephones

50,750

50,200

550

Official Posts, Telegraphs and Telephones

2,424

2,300

124

Total for Posts, Telegraphs and Telephones

85,464

85,000

1,034

570

Inland Revenue:

Mining:

State Ownership Revenue: Licenses and Mynpacht Dues

377

394

17

State Diamond Diggings

3,005

2,759

246

Income Tax:

Normal Tax:

Gold mines

68,127

64,600

3,527

Diamond mines

3,869

3,680

189

Other mines

17,192

14,490

2,702

Individuals

102,000

93,000

9,000

Companies (other than mining)

125,812

119,000

6,812

Super Tax (individuals)

1,000

780

220

Interest on overdue tax

800

800

318,800

296,350

22,450

Non-Resident Shareholders’ Tax

10,000

8,550

1,450

Undistributed Profits Tax

700

400

300

Donations Tax

150

150

10,850

9,100

1,750

Licences

4,000

4,000

Stamp Duties and Fees

12,750

13,100

350

Estate Duties

3,020

3,000

20

Bantu Pass & Compound fees

140

120

20

Fines and forfeitures

2,400

2,400

Quitrents and farm taxes

6

6

Rents of State Property

1,900

1,800

100

Forest revenue

3,000

3,000

Recoveries of advances

275

180

95

Transfer Duty

10,000

11,500

1,500

Tax on Purchase and Sale of Marketable Securities

1,400

1,800

400

Cinematograph Films Tax

840

800

40

39,731

41,706

275

2,250

Departmental and Miscellaneous receipts:

Contribution from South West Africa in terms of Police (S.W.A.) Act, 1939.

400

400

Government Garage

7,500

6,900

600

S.A. Reserve Bank

4,490

4,600

110

Mint

1,034

1,400

366

Government Printer

5,160

4,500

660

General

23,653

18,372

5,281

42,237

36,172

6,541

476

Interest:

On State Loans and investment of Cash Balances

29,151

27,551

1,600

Dividends

3,849

3,849

33,000

31,400

1,600

Total for Inland Revenue

448,000

417,881

32,862

2,743

Total Revenue to be Received

727,114

689,611

48,556

11,053

Net increase:

R37,503

REVENUE, 1962/63. (On existing basis of taxation)

R,000

Head of Revenue

Estimates 1962/63

Revised Estimates 1961/62

Increase

Decrease

Customs and Excise:

R

R

R

R

Customs:

Import duties

87,800

79,800

8,000

State Warehouse rent

18

18

10

Fines and penalties

30

40

10

Bonded Warehouse licences

12

12

Miscellaneous

70

90

10

87,930

79,930

8,010

10

Excise:

Spirits

25,700

24,700

1,000

Beer

7,500

7,200

300

Cigarettes and cigarette tobacco

47,150

47,000

150

Pipe tobacco & cigars

5,500

5,500

Motor cars

15,000

14,700

300

Matches

550

550

Yeast

360

360

Pneumatic tyres (including tubes)

1,600

1,570

30

Motor fuel

8,200

7,600

600

Wine

3,100

3,000

100

Gramophone and phonograph records

280

270

10

Paraffin, diesel and furnace oils

1,300

1,230

70

Acetic & puroligneous acids

10

20

Miscellaneous

20

20

116,270

113,720

2,560

10

Total for Customs and Excise

204,200

193,650

10,570

20

Posts, Telegraphs and Telephones:

Posts:

Postage

21,400

21,350

50

Commission

700

690

10

Box and bag rents

546

540

6

Ocean Mail Service

800

800

Miscellaneous

1,654

1,810

156

25,100

25,190

66

156

Telegraphs

7,200

7,100

100

Telephones

53,150

50,750

2,400

Official Posts, Telegraphs and Telephones

2,350

2,424

74

Total for Posts, Telegraphs and Telephones

87,800

85,464

2,566

230

Inland Revenue:

Mining:

State Ownership Revenue: Licences and Mynpacht Dues

373

377

4

State Diamond Diggings

2,868

3,005

137

Income Tax:

Normal Tax:

Gold mines

80,500

68,127

12,373

Diamond mines

4,000

3,869

131

Other mines

17,000

17,192

192

Individuals

105,000

102,000

3,000

Companies (other than mining)

124,900

125,812

912

Super Tax (individuals)

200

1,000

800

Interest on overdue tax

800

800

332,400

318,800

15,504

1,904

Non-Resident Shareholders’ Tax

10,000

10,000

Undistributed Profits Tax

600

700

100

Donations Tax

150

150

10,750

10,850

100

Licences

4,000

4,000

Stamp Duties and Fees

12,750

12,750

Estate Duties

3,000

3,020

20

Bantu Pass and Compound Fees

120

140

20

Fines and forfeitures

2,400

2,400

Quitrents and Farm Taxes

6

6

Rents of State Property

1,900

1,900

Forest revenue

3,000

3,000

Recoveries of advances

250

275

25

Transfer duty

10,000

10,000

Tax on Purchase and Sale of Marketable Securities

1,500

1,400

100

Cinematograph Films Tax

840

840

39,766

39,731

100

65

Departmental and Miscellaneous Receipts:

Contribution from South West Africa in terms of Police (S.W.A.) Act, 1939

400

400

Government Garage

7,790

7,500

290

S.A. Reserve Bank

4,500

4,490

10

Mint

1,800

1,034

766

Government Printer

4,900

5,160

260

General

22,253

23,653

1,400

41,643

42,237

1,066

1,660

Interest:

On State Loans and investment of Cash Balances

30,751

29,151

1,600

Dividends

3,849

3,849

34,600

33,000

1,600

Total for Inland Revenue

462,400

448,000

18,270

3,870

Total Revenue to be Received

754,400

727,114

31,406

4,120

Net increase:

R27,286

Mr. WATERSON:

Mr. Speaker, after the speculation in the last few weeks as to what the hon. the Minister of Finance will have to propose this afternoon, together with his reluctance to place the Estimates of Expenditure on the Table, as is usually done, one can only imagine that the average taxpayer, who has either listened to or is very shortly going to read the Minister’s statement, will feel that all the fears expressed in the last few weeks have been fully justified.

Sir, the hon. the Minister is always entertaining when he introduces his Budget, and he likes to dress up for the occasion. Last year you will remember, Sir, he was a doctor, complete with stethoscope and a book of prescriptions for the ailing body of the economy of the country. This year, presumably influenced by his colleague, the Minister of Defence, he has become a general, and he spent his afternoon talking about plans of campaign, making reconnaissances, and he has even gone so far as to mobolize the Reserve Bank to turn shares into swords for the benefit of the country. The Minister says that this is a defence budget, and of course that is perfectly true. I think that the country will realize that the Minister is introducing his Budget under the shadow of events to come, the extent of which nobody can foresee. Apart from the words used by the Minister at the beginning of his speech, we have other factors casting uncertainty over the country. We have, for instance, the Prime Minister’s colonial adventure in the Transkei; we have the deep uncertainty as to the future of South West Africa and its implications both for that territory and for the Republic; we have the war-like speeches of the hon. the Minister of Defence, whose speeches can be interpreted in the words of one of his own newspapers which said last week that the citizens of South Africa must henceforth learn to live with a trowel in one hand and a sword in the other. Sir, these are all grave and weighty matters. We shall examine these Budget proposals purely on their financial aspects, naturally, but in the course of this debate it will be quite impossible to ignore the wider issues, both the ones raised by the hon. the Minister and the ones referred to by myself—issues for good or ill—and nobody even knows that to-day—will certainly affect the financial position of the country and will certainly affect its economic prospects.

At this stage, with the consent of the hon. the Minister, I would like to move—

That the debate be now adjourned.
Mr. EATON:

I second.

Agreed to; debate adjourned until 26 March.

OLD AGE PENSIONS BILL

First Order read: Second Reading,—Old Age Pensions Bill.

Bill read a second time.

House In Committee:

Bill committed in respect of Clause 1 only.

Clause 1 put and agreed to.

House Resumed:

Bill reported with an amendment by the Select Committee in Clause 1.

Amendment put and agreed to.

Bill read a third time.

BLIND PERSONS BILL

Second Order read: Second Reading,—Blind Persons Bill.

Bill read a second time.

Bill read a third time.

WAR VETERANS’ PENSIONS BILL

Third Order read: Second Reading,—War Veterans’ Pensions Bill.

Bill read a second time.

Bill read a third time.

DISABLITIY GRANTS BILL

Fourth Order read: Second Reading,—Disability Grants Bill.

Bill read a second time.

House in Committee:

Bill committed in respect of Clause 1 only.

Clause 1 put and agreed to.

House Resumed:

Bill reported with an amendment made by the Select Committee in Clause 1.

Amendment in Clause 1 (Afrikaans) put and agreed to.

Bill read a third time.

GROUP AREAS AMENDMENT BILL

Fifth Order read: Report Stage,—Group Areas Amendment Bill.

Amendments in Clauses 8 and 22 put and agreed to.

In Clause 22,

Mr. PLEWMAN:

I move as an amendment—

To add the following paragraph at the end of sub-section (5) of the proposed new Section 25bis:
(c) Every such proclamation shall cease to have the force of law 30 days after it has been laid upon the Tables of both Houses of Parliament unless before that date it has been approved by resolution of the Senate and of the House of Assembly.

Someone very wisely said: “If hard cases make bad law, arbitrary powers make worse.” We are here concerned with a case where arbitrary powers are being conferred upon the Executive Government to change existing laws by the simple process of the issue of a proclamation. In other words, powers are being conferred in this sub-section which can result in an outright repeal or an amendment of any existing law—whether it be a law of this Parliament, or a pre-Republican or pre-Union law, a provincial ordinance or even a by-law—and that alteration can take place by the simple process of a proclamation. That is of course legislation by decree.

In principle my amendment has got nothing to do with group areas at all. The principle I am concerned with here is to secure the prerogatives of Parliament and to see that those prerogatives are maintained. Accordingly my proposal is that any step taken in terms of this sub-section shall come for approval before Parliament at some stage. Now as the hon. the Minister will see, I, speaking for this side of the House, have had second thoughts in regard to the matter. The principle is still the same as that of the amendment which was moved during the Committee Stage, but the method by which the approval of Parliament shall now be sought has been changed. I now propose that approval should be by way of a resolution of both Houses. There is precedent for that, because the hon. the Minister of External Affairs, now of Foreign Affairs, last year in a Bill dealing with the Commonwealth Relations Temporary Provisions (Act 41 of 1961) himself moved a provision which is virtually the same as the one I have moved. The hon. the Minister of Foreign Affairs rightly accepted that parliamentary supervision and control over the repeal of existing laws was of the essence for good government. Sir, until last Session I know of only one instance which gave power similar to these to change an existing law by means of a proclamation. That took place in 1933. At that time South Africa was in the throes of an economic depression and there existed virtually a state of economic emergency. But even in those circumstances, Sir, the powers conferred upon Executive Government did not go beyond permitting a suspension of an existing law, not a repeal or an amendment. I am referring to the case of the Currency and Exchange Act No. 9 of 1933. In that instance Parliament recognized that there was an inherent danger in surrendering control over the amendment or changing of existing laws by means of proclamation and Parliament therefore inserted a safeguard. The safeguard inserted in that case is identical in principle to that set out here, with this slight modification, namely that the approval of Parliament can now take place by resolution of both Houses instead of by Act of Parliament. Last Session the Minister of Community Development himself agreed to a similar provision when he piloted through the House the Preservation of Coloured Areas Act (No. 31 of 1961). As I say, the principle involved here has got nothing to do with group areas at all; the principle involved is the preservation of the legislative sovereignty of Parliament. Subject then to a safeguarding provision such as I have moved, it leaves the hands of administration free. Administration can continue to act, can do what is necessary, but will have to come to Parliament in the ordinary course of events in the ensuing Session, or during the same Session if it has to be done so expeditiously, to have approval for the proclamation which has brought about a change or a repeal of an existing law.

I quoted two instances during last Session where legislation by decree was authorised by Parliament, but subject to this safeguard. But the principal Act we are dealing with now is of course a different one from both those other Acts. Here we are dealing with a contentious subject, we are dealing with a highly complicated subject and with an Act where the rights of individuals may be affected. If ever there was a case in which the prerogatives of Parliament and its sovereignty in the legislative field should be safeguarded and protected, this is one.

As I say, I have had second thoughts in regard to the matter and I hope that the hon. the Minister will also have second thoughts in regard to the matter and will therefore accept this amendment which, as I say, is a modification of the one he accepted last year, it is exactly in the same terms as the one which the Minister of Foreign Affairs himself moved during last Session.

There is one other aspect about the matter that I think I should mention, and that is this: If a proclamation in terms of this power is issued and the wrong law is altered or some error is made in that proclamation, the executive government cannot adjust the matter itself—it is functus officio, the matter is finished. It will have to come to Parliament to set the matter right. I think that is an undesirable state of affairs. I think therefore that is an added reason why a safeguard of this nature should be provided for in legislation of this kind. As I say, this is not only a controversial subject, but it is an extremely complicated subject, and nobody knows that better than the hon. the Minister himself. If the House is to permit the alteration of existing laws by proclamation—well, that is what Parliament has done. I concede that the legislation must work, and that administration must be entitled to go on, but I say that provision should have this additional safeguard, namely that any laws that have been altered shall come back to this House and it will lapse unless the Minister gets approval by sanction of both Houses of Parliament in an ensuing Session. I do not think that anybody can say that there is anything difficult in a situation of a safeguard of this nature, and it is one, I think, which Parliament has a duty to insert. I therefore hope that the hon. the Minister will also have second thoughts and will agree to the amendment.

Mr. TUCKER:

I beg to second. I would like to support the reasons given by the hon. member for Port Elizabeth (South) (Mr. Plewman) and to submit some additional reasons to the hon. the Minister why this amendment should be accepted. Sir, the clause with which we are dealing and to which the proposed amendment is moved, is one of a far-reaching character, and it provides that in respect of the establishment of a local authority, the Minister after consultation, may in respect of management committee area which is within an existing local authority, if he considers it desirable that a local authority be established, direct the Administrator to take the necessary steps. The law then provides—it is a very far-reaching provision for which I know no parallel in our law—that the Administrator concerned—

… notwithstanding anything to the contrary in any other law contained, may take or cause to be taken all steps that are neccessary for the proper establishment for that area in terms of the laws in force in his province …

That is going very far. It vests extraordinary powers, but it goes even further. The clause proceeds—

… in terms of laws in force in his province of a local authority of the type so specified as if all such conditions precedent to the establishment of such a local authority as the Minister, after consultation with the Administrator concerned, may determine, had been duly complied with.

Not only is there an inroad into the normal procedure by which local authorities are established under the authority of a provincial council, but all the safeguards which exist for enquiry, and so forth, are swept aside by the provision that there is a deeming provision which deems all the necessary prerequisites to have been complied with. In other words, this cuts right across the system of local authorities, and it is proper that Parliament should have the final say. I believe that the hon. member for Port Elizabeth (South) has here produced a better amendment than the one which the hon. Minister was not prepared to accept, and I express the hope that the hon. the Minister will be prepared to accept this amendment. It will mean that this procedure will be established—the clause has already been approved of—but it will also mean that the objectionable provisions of this clause (I am not reflecting on the clause), the provisions which cut across the prerogatives of the local authority itself and of the provincial administration will be subjected to the safeguard that it is necessary that a resolution should be adopted by both Houses of Parliament. I do submit to the hon. the Minister that if ever there was a case where an amendment should be accepted, this is it. I would say further to the hon. the Minister that it is quite obvious that this would lead to no inconvenience. Only in each session of Parliament the hon. the Minister would come before the House with a resolution which would approve not separately of each particular case where there may have been a local authority established, but one resolution would be quite adequate in terms of the resolution which is proposed by the hon. member for Port Elizabeth (South). There would only be a debate, if necessary, upon one resolution and upon acceptance of that resolution by this House, it would go to the Other Place for confirmation. I appeal to the hon. the Minister in the interests of sound legislation to accept the amendment.

*The MINISTER OF COMMUNITY DEVELOPMENT:

As the hon. member for Port Elizabeth (South) has mentioned, I proved in the past that I agreed to this principle when I accepted it in connection with another Bill, and I should very much like to meet hon. members, but I hope that in that case the hon. member will also meet me. As the amendment now reads it says that every such proclamation will cease to be valid 30 days after it has been Tabled in both Houses of Parliament. That seems to me to be an unduly short period because as the result of the procedure here, with which we are all acquainted, we may find ourselves in this position that we are unable to give effect to it within that short space of time. I suggest that the hon. member should make it 90 days; I would then be prepared to accept the amendment.

*Mr. PLEWMAN:

I am prepared to accept the alteration.

With leave of the House, Mr. Plewman withdrew his amendment.

Mr. PLEWMAN:

I move as an unopposed motion—

In Clause 22, to add the following paragraph at the end of sub-section (5) of the proposed new Section 25bis:
(c) Every such proclamation shall cease to have the force of law 90 days after it has been laid upon the Tables of both Houses of Parliament unless before that date it has been approved by resolution of the Senate and of the House of Assembly.
Mr. TUCKER:

I second.

Agreed to.

Amendment in Clause 36, the new Clause 39 and the amendment in Clause 42 put and agreed to, and the Bill, as amended, adopted.

The MINISTER OF COMMUNITY DEVELOPMENT:

I move—

That the Bill be now read a third time.

More than two members having objected,

Bill to be read a third time on 22 March.

MARKETING AMENDMENT BILL

Sixth Order read: Second reading,—Marketing Amendment Bill.

*The MINISTER OF AGRICULTURAL ECONOMICS AND MARKETING:

I move—

That the Bill be now read a second time.

Hon. Members will recall that last year this House approved of fairly comprehensive amendments to the Marketing Act with a view to making the Act more effective for the purpose for which it was designed, and that is to promote stability in our agricultural industry. Although to a very large degree the Act as it now reads makes provision for the great variety of powers which are needed to establish effective schemes to deal with the particular marketing problems which are peculiar to every product that falls under the Act, there are still a few aspects which have come to the fore since then and for which further special provision is necessary. The aspects can be summarized briefly as follows:

It is generally know that fresh milk is produced at a higher cost than industrial milk. One of the reasons for this is to be found in the stringent requirements laid down by local authorities for the hygienic production of fresh milk. In practice therefore fresh milk also has a considerable price advantage over industrial milk. Because each centre only needs a certain quantity of fresh milk every day, the surplus production has to be diverted to other channels, usually as industrial milk, and naturally at lower prices. This aspect necessitates the taking of special steps in marketing fresh milk to ensure fair treatment for the producers. The method which is followed pretty generally in practice under conditions of free marketing, is that the distributor of fresh milk grants a fresh milk quota to each of the producers delivering milk to him. For deliveries within his quota the producer then gets the ruling fresh milk price and for any surplus over and above that he receives the lower industrial milk price. The “quota” of a producer is calculated as a rule on the basis of his total production during a previous specified period. A scheme was recently announced which makes provision for regulating the marketing of fresh milk and fresh cream in the Pretoria, Witwatersrand, Bloemfontein and Cape Town areas. In applying this scheme it may also be necessary to cause payment to be made to producers on the basis of allocated quotas or according to other methods which are considered reasonable—for example that producers be paid on a pro rata basis according to the total quantity delivered by each but at a rate per gallon which diminishes as the producer’s deliveries increase. According to legal opinion which has been obtained, there seems to be doubt as to whether the relevant provisions of the Act are wide enough to permit of such methods of payment to producers. A suitable amendement so as to be able to grant the necessary powers to a control board, and thus to remove this doubt, is proposed in Clause 6 (1) (a) of the Bill. It is further proposed that this amendment be made of retrospective effect from 18 June 1951 that is to say, the date on which the Act was amended the first time to make special provision for regulating the marketing of fresh milk and fresh cream.

There are quite a few other proposed amendments which relate exclusively to milk and cream but which are of a purely technical nature, for example provision is made for definitions in terms of which “milk” and “crem” also include the sterilized products, and references to the “Dairy Industry Act of 1918” are being replaced by references to the “Dairy Industry Act, 1961”.

The Marketing Board, as the result of representations received by it, investigated the possibilities of a scheme for the marketing of fruit and vegetables which are destined for canning. It appeared from these investigations that in all probability such a scheme would succeed in its purpose and would also prove more practicable if arrangements could be made whereby the transaction between producers and canners could take place in an orderly fashion and on a fixed basis. At this stage it does not seem to be necessary for a control board to step in as the first buyer in such a case, but that the board must have the power to prohibit producers and canners from trading with one another except in accordance with a written agreement of which the control board must have knowledge and in which provision is made for the purchase and sale of such products at prices calculated according to the grade of those products. Amongst other things, such an arrangement would prevent producers and canners during the harvesting season from making all sorts of loose arrangements to the detriment of the industry, and there would also be more certainty then with regard to the payment to producers according to the quality of their products.

At the moment the Marketing Act does not make provision for such a power to be conferred on a control board, and the necessary amendment in this regard is proposed in Clause 6 (1) (b) of the Bill. This particular matter is regarded as being so peculiar to the production and marketing of fruit and vegetables destined for canning that this power is only being granted in respect of a scheme for these products.

In those cases where the production of an agricultural product is continuous for a few months, or even spread over the whole year, it is customary for control boards which control one-channel schemes with pools for the marketing of such products, to institute separate pools which may extend over a month or even over a shorter period. In the case of export fruit, a separate pool is sometimes controlled for each consignment. The main reasons for these separate pools is obvious. Marketing conditions sometimes vary considerably and it would be unrealistic therefore, for example, to control one export citrus pool for the whole of the citrus season.

However, hon. members will readily understand also that a particular pool may be affected very detrimentally by some unforeseen occurrence—for example a strike of dock workers resulting in an accumulation of supplies and a deterioration in the quality of the product. In such a case it would not be unreasonable to supplement the proceeds of that particular pool to some extent with the proceeds of the other pools. It is now proposed to make provision in the Act for a power in terms of which such transfers between pools may take place with the approval of the Minister.

The other amendments which are being proposed here are more of an administrative nature. Amongst other things, provision is being made for a power in terms of which an acting chairman of the Marketing Council may be appointed when the post of chairman becomes vacant. As the Act now reads, an acting chairman of the Council cannot be appointed. It sometimes happens that upon the retirement of a chairman, one would like to appoint an acting chairman in the meantime. It may also happen that the chairman is not available as the result of other circumstances, and the Act makes no provision for the appointment of an acting chairman.

In connection with the publication, for general information in the Government Gazette and in newspapers, of particulars with regard to proposed schemes and proposed amendments to schemes, it is proposed that the Act be so amended that there will be no doubt that such publication will be in the discretion of the Minister and the reference to publications and newspapers is being deleted. This proposed amendment is designed to obviate cumbersome and expensive procedure, and in fact, this has also been done in the past; this is the procedure which has always been followed, but the opinion has been expressed that procedure is not valid. In order to place the validity of the procedure that was followed when the existing schemes were instituted beyond any doubt, it is proposed to make this amendment of retrospective effect from the date of the passing of the principal Act.

Since this Bill was read a first time, it has been brought to my notice that certain boards, which have been established in terms of the Act, are experiencing problems in connection with the implementation of Section 20 (2) bis (i) (c) of the Act. This sub-section (2)bis provides that a board, if authorised by the relevant scheme and with the approval of the Minister, may instruct producers to notify the board of the total quantity of any product that they propose to deliver to the board during any future period. It also grants the board the power to recover from any producer, who has delivered to the board a quantity which differs from the quantity of which the producer concerned gave notice, an amount which, according to the estimate made by the board, with approval of the Minister, is approximately equivalent to the amount of the loss suffered as the result of such difference in the quantities. An amendment to the section referred to will be moved in the Committee stage so as to eliminate the problems which are being experienced in this connection. This amendment will be printed on the Order Paper when we have disposed of the second reading.

*Mr. H. G. SWART:

Just explain that last portion again please.

*The MINISTER OF AGRICULTURAL ECONOMICS AND MARKETING:

Last year when we amended the Marketing Act, the Opposition moved the insertion of a proviso to the provision that the board may recover such loss from a member or members. The proviso was to the effect that the board should only be able to recover that loss if the circumstances were within the control of the member or producer concerned. I then accepted that amendment. But now we find in the case of the Citrus Board, which acts for people who have to deliver fruit to them for export, that they cannot recover from those people if they fail to deliver, in other words, where they are responsible for the fact that higher costs have to be incurred. An Opposition Senator has already discussed this matter with me, and this amendment is being moved to enable the Citrus Board, for example, to make its arrangements in the future.

The amendments proposed in this Bill are necessary to promote the aims of the Act, and I confidently submit this Bill to the House in the interest of our agricultural industry.

*Mr. SWART:

I think that this side of the House, like the other side of the House is compromised in the better sense of the word, as far as the Marketing Act is concerned, to uphold and support the basic principles of the Marketing Act. The main basic principles of the Marketing Act are known to all of us, namely to promote the orderly marketing of our agricultural products as far as possible by way of schemes under control boards instituted in terms of the Marketing Act. That is why this side of the House will always support any amendment to the Marketing Act which is aimed at improving it and facilitating its application and making it work more smoothly. That is also the reason why this side of the House has no great objection to any of the clauses which the Minister suggests in this amending Rill. In the Committee Stage we will move an amendment in respect of Clause 4 (a) where the Minister proposes to delete completely from the Marketing Act his right to advertise any scheme which is promulgated in one or other newspaper circulating in the area where the scheme will operate. As the Marketing Act reads at the moment, the Minister may—he is not obliged to do so —advertise the scheme in the Government Gazette as well as in any publication or newspaper circulating in the area where the proposed scheme will operate. If I read this clause in the Bill correctly, he is doing away completely with his right to advertise it in a local publication. He also adds that if he deems it necessary he may advertise it in the Government Gazette but he is not obliged to do so. I am somewhat doubtful as to the wisdom of deleting completely the Minister’s right to advertise any scheme which he wishes to promulgate in a local newspaper circulating in the area where the scheme will operate. That is what is being done in this Bill. As the Act reads at the moment, I think, it provides that the Minister may advertise a scheme in the Government Gazette and in a local newspaper, if he deems it necessary. In this proposed amendment he only retains the right to advertise it in the Government Gazette but his right to advertise it in a local newspaper which circulates in the area where the scheme will operate is taken away completely. I am somewhat doubtful as to whether that is the right thing to do. I realize that in terms of the amendment which we effected to the Marketing Act last year, the Minister may accept any scheme without the local inhabitants to whom the scheme will apply having asked for it. Even if they do not want the scheme the Minister can make the scheme applicable to them if the Agricultural Union has asked for it. If the Agricultural Union has asked for it he can make the scheme applicable to a certain number of producers in a certain area. It may be argued that in view of the fact that he no longer has to have the consent of those producers, now that he is not obliged to ask for their approval and can apply it merely on the recommendation of the S.A. Agricultural Union, it is no longer necessary to advertise such a scheme in a local newspaper circulating in the area concerned. But as the Act read originally it is not necessary for the Minister either to advertise it in a local newspaper if he does not deem it necessary. But I think circumstances may always arise where it may be necessary for the Minister to have the right to advertise it in a local newspaper in order to give general satisfaction to the producers who will come under the scheme. Circumstances which we cannot visualize at the moment may arise which may make it advisable for the Minister, for the sake of general satisfaction, to advertise the proposed scheme in a local newspaper, so that the people affected may read about it. It may be that they are satisfied with it or it may be that they object to it. But I do not think the Minister ought to relinquish the right which he has under the existing law to do so. As the law reads at the moment he is not obliged to do so but in terms of the new provision that right is taken away from him completely. No mention is made in the Bill that the Minister may advertise such a scheme in a local newspaper. I wish to make an appeal to the hon. the Minister. I do not understand why the Minister should relinquish the right which he has at the moment, a right which he need not exercise if he does not wish to do so. Circumstances may arise which may make it necessary for him to have that power and I cannot understand why the Minister should delete completely from the Act a right which he has, a right which may become necessary in certain circumstances. The original Act says “The Minister may”. He is not obliged to do so. But if this amendment is passed he relinquishes the right to do so completely. I think this is an unnecessary provision. The Minister may be sorry one day that he has deprived himself of this right. That is the main criticism I have to offer in respect of the various provisions of this Bill.

As far as Clauses 6 (1) (2) are concerned— they deal with the question of the marketing of fresh milk and fresh cream—we have no serious misgivings about those. As far as I personally am concerned, I think it is an improvement and I shall support it. Clause 6 (1) (b) deals with the position where a scheme in respect of the processing of fruit and vegetables is introduced in an area and I cannot see how any scheme can operate successfully if the control board to be established does not take the powers which are defined here. If the Board does not have the power to prohibit people from selling fruit and vegetables out of hand but under contract, without that contract coming to the notice of that board to be appointed, and without the approval of that board, the scheme will be doomed to failure right from the start. That is the main reason why I support Clause 6 (1) (b).

I come to paragraph 5 (b) which provides that subject to the approval of the Minister the board may transfer a certain portion of the proceeds of a pool to any such other pool conducted by the board. I take it that will be a pool in respect of the same product. In practice the position is that you have a pool and then another one is formed. They are not two pools in respect of different products. I think that is correct, isn’t it? From my experience as a director of co-operative societies for many years, particularly before maize came under the Marketing Act, I know that it was necessary on occasions to strengthen one pool at the expense of another, and we never had the right to do so. That was before the Marketing Act was made applicable to maize. It will now be possible to do so with the approval of the Minister. But I hope that the board who will be charged with this —it cannot be done without the approval of the Minister—and the Minister, will do so with the greatest circumspection and that the proceeds of one pool will not lightly be transferred to another one. Because it may be that a person who has contributed to one pool in respect of a certain product, contributes much more or much less the following year and if you transfer too much from one pool to the other some people will certainly benefit and others will certainly be prejudiced, although for the sake of the whole position in general and for the soundness of the whole undertaking, it may be a good thing to do so. It may be to the benefit of the undertaking as a whole, but an individual may perhaps be affected adversely and I hope that the hon. the Minister and his Department and his advisers will not give this approval lightly. It can be resorted to in order to assist some organization out of its difficulties, but it may affect other people adversely.

Mr. Speaker, I do not think this is the right time to discuss the general principles of the Marketing Act. Nor do I think that you, Mr. Speaker, will allow it. However, I do want to say this that the Marketing Act has now passed through the first phase of the test namely whether the Marketing Act and the system of control boards under the Act have been a success. That was the phase to ascertain whether the Marketing Act and the control board system have been to the benefit of the consumer and I think we can definitely say that it has passed that test successfully. But we are now entering another phase and I want to state it very clearly that the Marketing Act will have to prove that it can still operate successfully during a period when agricultural prices are falling, to help the farmer over his difficulties. The picture has changed to-day. To-day it is the consumer and other undertakings in the country who will have to make the sacrifices for the sake of the farmer, whereas the farmer has been the one in the past who has had to make the sacrifice as far as price fixations under the Marketing Act have been concerned for the benefit of the other undertakings. The time has arrived when we will have to prove whether or not under the control system the Marketing Act will also pass successfully through this second phase. That will depend on the measure of sound judgment which this hon. Minister who is in charge of the Marketing Act and the measure of sound judgment which his Department displays in the application of the Act during this second phase.

*Mr. G. F. H. BEKKER:

As has often been said the Marketing Act is the magna charta of the farmers. Those who tamper with that Act tamper with the farmers. Where the S.A. Agricultural Union have been consulted in this instance by the Minister and where various groups have discussed this matter, I do not think that this is tampering with the Act but that we are improving the Act. We all know the Marketing Act of 1937 and we also know the Marketing Act as amended in 1946. As we all know it was a compromise Act. When we come to the fixation of prices of farm produce, we find that the boards are composed of representatives of all those who are concerned with that product. We have the brokers, of course, and we have the farmers —it is a compromise Act. Thus far the Act has worked well. We only hope that in future the farmers will be given a slightly bigger chance of bringing their products, a little nearer to the people in the cities. As the position is to-day we cannot do that. I think we can only support the Minister in this case where he is effecting an improvement. We are all bound by organized agriculture and where organized agriculture supports the Minister, I think the whole House will agree that the Minister is doing the right thing in removing the hitches which still existed. We have nothing here which is not constructive. The Minister will always have to have a certain amount of power and I do not think the Minister is relinquishing any of that power in this Bill. He must always ensure that the law operates smoother. We know there was a time when a vote had to be taken, and all the rest of it, before a product could be declared. That often cause difficulties, with the result that the law could not be applied. That has now changed. If the Minister is convinced that the Act will function properly and the agricultural union supports it, he may promulgate a scheme.

*Mr. DURRANT:

[Inaudible.]

*Mr. G. F. H. BEKKER:

Mr. Speaker. there I hear the fog horn again, and I have heard him before. That name suits him admirably because he has never done anything else but make a noise. That is why his name is fog horn and I hope that will always be so. In conclusion I wish to say that I am convinced that the whole House will accept this Bill.

Mr. BOWKER:

The hon. member for Cradock (Mr. G. F. H. BEKKER) has said that the Marketing Act, No. 26 of 1937 is regarded by the agricultural community as their Magna Charta and that any tampering with or amendment to that Act will be regarded with grave misgivings. The member for Cradock says that the amendments to this Act have been approved by the South African Agricultural Union. We would also like to have the assurance of the Minister in this regard. We also want the hon. the Minister to give us further reasons for the powers which he seeks in this amending Bill. We realize that in the administration of the Marketing Act the Minister has to have certain powers; those powers change from time to time to fit in with the peculiarities common to various products. We notice, for instance, in this Bill that the Minister is including sterilized cream and sterilized cream in the definition of milk and cream so as to keep on the right side of the law and to regularize the control of this product. It is our duty on the Opposition benches also to see that the rights of both the producer and the consumer are safeguarded. We have certain misgivings when the Minister seeks powers which will have a retrospective effect. This Bill makes provision for powers which will have a retrospective effect. We look with disapproval at sub-section (2) of Clause 1, sub-section (2) of Clause 2 and sub-section (2) of Clause 3, which provide that these provisions will now come into operation as from 1 January 1961. In Clause 4, section 17 of the principal Act is amended and this is dated back to the commencement of the principal Act in 1937. This will legalize all schemes which were not properly advertised. We would like the Minister to inform the House how many schemes, by the laws of this land, are regarded as not having been adequately advertised. I think that schemes which affect the lives of everyone should be advertised in one or more of the local newspapers as has been stressed by the previous speaker from this side of the House. In the case of schemes which only operate in a local area I think in the Minister’s discretion they should be advertised in the local newspaper only. We would like the Minister to inform us why he seeks this amendment in Clause 4, namely to amend Section 17 of the principal Act—

by the insertion in paragraph (b) of sub-section (3) after the word “may” of the words “if he deems it necessary”…

That condition will now read—

The Minister may, if he deems necessary, cause the particulars concerning such scheme to be published by notice in the Gazette and in one or more newspapers circulating in the area.

What I want to stress is that unless the Minister deems it necessary he need not advertise the particulars of any scheme in the Government Gazette. Now, Sir, advertising in the Government Gazette is something fundamental. In the administration of estates and in everything else you must advertise in the Gazette. Why the Minister seeks to free himself of this, is not clear to me. Surely the Minister did not think that the word “may” gave him an option. Surely the Minister knows how the courts of law have often interpreted the word “may” as meaning “must”. I can assure the Minister as one who helped to draft the Act and pass it in Parliament, in this particular instance “may” was meant to imply “must”. The Minister must advertise the particulars. It does seem so because the Minister now wants this amendment to be of retrospective effect—he wants it to date back to when the Act was passed in 1937. I think this is a fundamental change in this legislation. The Minister must give us better reasons for this change than those he gave when he introduced the Bill. Perhaps the Minister can inform us about his contact with the S.A. Agricultural Union and the advice he received from that body. How did they regard this provision? I can assure the Minister that this was a provision which we did not consider lightly when the Act was passed. We feel it is essential that any scheme which concerns the Marketing Act should be advertised in the Gazette. Perhaps I do not feel so strongly about the Minister’s discretion as regards local newspapers. Perhaps the Minister would also explain to us, when we come to the Committee Stage, why he wishes to delete the words “and in one or more newspapers circulating in the area in which the scheme is to apply”, from the respective Section. Perhaps the Minister could give us some further reasons for it. It seems only natural that before a scheme is passed it should be published in the Gazette to legalize it. We farmers feel that the publication of a scheme in the Gazette is fundamental. I also feel that numbers of local people do not know what is published in the Gazette. Our idea, when passing the Marketing Act, was that schemes should be open to all farmers. A scheme is only applied when a certain percentage of producers approves of it and for that reason the advertising is very essential and I appeal to the Minister not to include this amendment in the Bill and I hope that when we come to the Committee Stage the Minister will make some concessions in this regard.

*Mr. MARTINS:

We now have the peculiar phenomenon that the hon. member for Florida (Mr. Swart) quite rightly gives his party’s full support to the Bill with the exception of Clause 4 (a) which refers to whether the Minister is obliged to publish in a newspaper or newspapers or not. But while the hon. member for Florida is giving full support to the Bill, we find that the hon. member for Albany (Mr. Bowker) doubts the retrospective effect of the Bill. He refers to various clauses which stipulate that this Bill is retrospective to January of this year in one instance and in the other instance even further back. Now I don’t know. If the amendment is in order in the eyes of the Opposition and they welcome it and if it is in order from now on and to the advantage of agriculture, of the producer and of the consumer, according to them, then I cannot see how it can be logically argued that the Bill should not be good in retrospect. I cannot see why they do not want to accept that it will be good in retrospect, as there are certain reasons for it.

I first want to point out that the hon. member for Florida was right in making this statement that the Marketing Act is a permissive Act which gives the Minister, together with the various boards of control and the Marketing Board authority to organize the sale of products in an orderly fashion and that the Marketing Act will now have to be put to the test to a greater extent than in the past. In the past the Act gave the producer protection to a very great extent. But as a result of a temporary over-production as the result of this revolutionary agricultural progress, it has now become necessary for the Marketing Act also to give the producer proper protection in these times of over-production. Now we know—and for that reason I come to the clause about which the United Party has doubts—that there has already been a law-suit about whether there should be publication or not as regards the fresh milk scheme. And in that case it was established that the word “can” does not mean “must”. The court found that the Minister could use his discretion and that it was optional to him. If in his discretion he thinks that it should be published, he is free to do it, and the court decided that the Act never intended that “can” should mean “must”. But an appeal can be lodged against that decision and for that reason I am of the opinion that it is imperative that the Department and the Minister must have clarity in the Act so that this decision cannot later be rescinded. Because if an appeal should succeed against this decision, it can only be to the detriment of the milk producer as it will put the whole new scheme into reverse gear.

Now I come to the request of the hon. member for Florida, where he says that they are going to move an amendment in which they will force the Minister also to publish in the ordinary daily newspapers and not only in the Government Gazette.

*Mr. SWART:

Not force him.

*Mr. MARTINS:

This amendment makes provision for the Minister to publish it in the Government Gazette if he deems it fit, but immediately it makes provision that he will not publish it in the local newspapers—that he cannot publish it there. Why? He is doing it because it is also provided in the Financial Regulation Act of 1932 that when something has to be published in the Government Gazette, in which way it should be published in the local newspapers. Now we find that if we protect the interests of the taxpayer correctly, the levy funds of the producer, we have to ask ourselves what it would cost to give publicity to such a scheme in the ordinary daily newspapers. Let us take fresh milk as an example. You start a scheme and you have Cape Town, Pretoria, Johannesburg, Bloemfontein and Durban. You cannot confine yourself to local publication in the Burger or the Cape Times. You will have to publish in all the other daily newspapers so that people will be able to see it in all those places. If you place an obligation on the Minister or even if you allow a clause in the Act which would be disputable in the courts, so that he would be forced to publish in those newspapers as well, two results will follow. The one is enormous expenditure, as it is an expensive business to publish it. Secondly, it may perhaps be omitted to publish in a Natal newspaper and then the people can obtain a court decision to the effect that the Act had not been complied with by not publishing it there. For that reason it is stated clearly in this clause.

Where I have said that the time has now come for the Marketing Act to stand the test of giving the producer proper protection in order that he may get proper compensation for his work, I think it would be as well if the Opposition would not make a political question out of this Bill, but that they should support it. Because this Bill also has the effect of making provision for sterilized milk and sterilized cream, and affords the necessary protection to the fruit farmer, and because that is so, I want to support this Bill very strongly.

*Mr. CONNAN:

The hon. member for Wakkerstroom (Mr. Martins) sees only politics in everything said from this side of the House. He has just said that we should not always try to talk politics. If we on this side of the House try to give our view in order to improve a Bill, that is not talking politics.

Mr. Speaker, as you have already heard, we on this side support this Bill in general, but I also want to say something about Clause 4 (1) and I also believe that the position there is not correct. I do not believe it is correct that the Minister should have the right only to advertise the scheme in the Government Gazette when he thinks fit, and if he does not think fit he need not do so. That is how I read it. I have also thought about publication in the local newspapers and I realize what costs are involved, but on the other hand it is no more than right that the people interested in such a scheme should have the opportunity to know that such a scheme is forthcoming, and that their attention is directed to it. We did think that it should be compulsory to advertise in the Government Gazette, and that the attention of interested parties should in some way be directed to the fact that it is published there. That may perhaps be done by placing an advertisement in the local newspapers to the effect that the scheme is published in the Government Gazette. But I think it is no more than right that the attention of interested parties should be directed to it as far as possible, because we do not want the public to think that something is being done on the quiet. It should all be done in public. For the rest, we support the Bill, and I believe it will be an improvement, but in my opinion it is wrong not to compel the Minister to publish it in the Government Gazette.

*The MINISTER OF AGRICULTURAL ECONOMICS AND MARKETING:

I am glad of the general support given to this Bill by both sides of the House. When we propose an amendment to the Marketing Act, that is generally done after certain problems have arisen. Hon. members have particularly raised two objections. The one is to Clause 4 (1) (a). I just want to say what the position is.

When a scheme is submitted to the Minister it is generally submitted by people interested in the industry, by the producers of that product. As the law stands now, it says what must be done when a scheme is submitted to the Minister. The Marketing Board or any of the other bodies mentioned in the Act may submit a scheme to the Minister. If the Minister grants preliminary approval to the proposed scheme, the Act further provides in Section 17 (3) (a) that he should refer the scheme to the Marketing Board for investigation and report if it was not submitted to him by the Marketing Board, and in that case he may publish the details of the scheme in the Government Gazette and in one or more newspapers circulating in the area. As the law stands now, the Minister need not publish the scheme in the Government Gazette, but he may do so. Now the position is this. All the schemes which were submitted in the past were published in the Government Gazette because any Minister wants to bring it to the notice of the interested parties. But then there was a court decision in regard to the introduction of the fresh milk scheme. That scheme was also published in the Government Gazette, but the decision was to the effect that if the Minister makes use of the right given to him by the Act to publish it, he must also do the following thing. Then he may not only publish in the Government Gazette, but in terms of the Act he must publish full details of the scheme in one or more newspapers circulating in the area. That means that if the Minister makes use of the power given to him by the Act, he must also publish the scheme in the newspapers. That means that in any case in which the Minister publishes the scheme in the Government Gazette, he can be compelled also to publish it in the Press. The logical result of this is that, due to the costs connected with it, the Minister will not publish it in the Government Gazette at all. Let me give an example. Just the publication of the fresh milk scheme in the newspapers cost more than R2,000, apart from the publication in the Government Gazette. In order to prevent that, we now say that the Minister need not publish in the Press, apart from the Government Gazette, where he makes use of this right, but he need not make use of this right at all. He need not publish if he does not want to, and the amendment proposed here does not derogate from or add to that right in any way. The section must be made retrospective. The hon. member for Albany (Mr. Bowker) objects to that. It is being made retrospective because all the other schemes established under the Marketing Act in the past were established merely by means of publication in the Government Gazette, without publishing it in the general Press. In other words, unless it is made retrospective, all those schemes may be tested in court and they may all be declared invalid. That is why this amendment is being introduced. Perhaps that will now satisfy hon. members. But it still will not prevent the Minister, if he has published the scheme in the Government Gazette, from drawing the attention of the public to that publication in the Government Gazette by means of newspapers circulating in that area.

*Mr. SWART:

Is the Minister prepared to accept or to move an amendment to the effect that if he considers it necessary to publish it in the Government Gazette he will simply put a notice in the local newspapers to draw the attention of the public to the fact that the scheme has been published in the Government Gazette?

*The MINISTER OF AGRICULTURAL ECONOMICS AND MARKETING:

I would not mind accepting such an amendment, but I do not think we should provide for it in the Act, and I will tell hon. members why. We can get the Press to draw the attention of the public to such a publication in the Government Gazette in a much cheaper way. If one notifies the Press, the Press is generally prepared, because it is a matter of public interest, to make it known that such a scheme has been announced in the Government Gazette. Therefore I do not think it is necessary to have such an amendment. I think hon. members are needlessly afraid that when a scheme is instituted one is trying to mislead somebody, but that is not what happens. If a scheme is established it is done only with the approval of the producers of that product, and all the interested parties who deal with that product receive recognition when such a scheme is established. I think hon. members are unnecessarily afraid that there will not be sufficient notice. It is merely intended to prevent people from going to court on minor points in order to nullify a scheme. One perhaps finds one person out of a hundred who goes to court on a trivial point, and that delays the introduction of the scheme for six or nine months, to the detriment of the whole industry.

The next point I want to deal with is the matter raised by the hon. member for Florida in connection with the pools. I think the hon. member has somewhat misunderstood me in this respect. It is not a question of one pool compensating for another, where one has had a pool for a year, as sometimes happens in the case of a co-operative when it has received a lot of grain and forms a pool for it, and the next year they receive the new crop and then the pool is used for that. With export fruit and other pools it may happen for some reason or other, like a docks strike overseas, that one has a pool for a few weeks and then one cannot sell the fruit. It is just that in such cases one can take from the one pool to assist the other which is affected in such a way. But that will never happen over a long period and therefore we are retaining the Minister’s approval in regard to this matter.

The other matters which were mentioned can be dealt with in the Committee Stage.

Motion put and agreed to.

Bill read a second time.

The House adjourned at 5.22 p.m.

THURSDAY, 22 MARCH 1962 Mr. SPEAKER took the Chair at 2.20 p.m. NEW MACE Mr. SPEAKER:

I have to inform hon. members that the Committee on Standing Rules and Orders at its meeting yesterday unanimously adopted a design for a new mace, which will be completed before the commencement of the 1963 session of Parliament.

On behalf of the House I wish to take this opportunity of placing on record the appreciation of the House for the generous offer of the Gold Producers’ Committee of the Transvaal and the Orange Free State Chamber of Mines to donate the cost of making the new mace and to supply the necessary gold from the goldmining industry.

BUSINESS OF THE HOUSE The MINISTER OF LANDS:

I move—

  1. (1) That on Tuesday, 27 March, the proceedings of the House shall be suspended at Half-past Six o’clock p.m. and resumed at Eight o’clock p.m.;
  2. (2) that on Friday, 30 March, Government business shall have precedence after Notices of Questions have been disposed of; and
  3. (3) that the House at its rising on Friday, 30 March, adjourn until Monday, 9 April, at a Quarter-past Two o’clock p.m.

This motion is in regard to the recess and hon. members will notice that on Friday, 30 March, which is usually private members’ day, the Minister of Finance will reply to the Budget debate. Thereafter the House will adjourn for the recess. We are thus depriving private members of the Friday morning and it has been agreed that when the House meets again on Monday afternoon, to make that available to private members. It is not necessary for me to state that in my motion. The private members’ day will simply be placed first on the order of that day.

Mr. J. E. POTGIETER:

I second.

Motion put and agreed to.

FIRST READING OF BILLS

The following Bills were read a first time:

Post Office Amendment Bill.

Radio Amendment Bill.

Animals Protection Bill.

GROUP AREAS AMENDMENT BILL

First Order read: Third reading,—Group Areas Amendment Bill.

The MINISTER OF COMMUNITY DEVELOPMENT:

I move—

That the Bill be now read a third time.
Mr. D. E. MITCHELL:

Mr. Speaker, we have come to the third reading of this Bill which is another amendment in a long list of amendments to the Group Areas Act and also to the Group Areas Development Act. We have considered whether we should move an amendment at this stage but we have decided against it. We shall simply vote against this Bill. This is legislation which is objectionable to us on this side of the House and unacceptable. Although during the course of the Committee Stage the hon. the Minister accepted one or two minor amendments from this side of the House, that does not alter the fact that in principle we are utterly opposed to the Bill.

There are certain provisions in the Bill which I think call for some comment. As has been said, Sir, this Bill provides for a take-over by the Minister and his Department of the Group Areas Board. The emphasis is now shifted from the Board, which remains in existence, to the Minister and his Department as far as the work of the Board is concerned. In fact, Sir, I go so far as to say that the Minister becomes the Board and the Department. He is—

A bo’sun tight, and a midshipmite,
And the crew of the captain’s gig.

Because the Minister is empowered to make regulations he has such authority that there is no need for him to go into a great deal of detail in this Bill. He just takes the power to deal with certain matters by regulation and then he can make regulations to suit himself. How far that power to make regulations goes is amply demonstrated in one particular clause, namely Section 25bis of Clause 22. There the State President who naturally acts on the advice of the Minister, can repeal, alter, amend or modify any law, including this law, in so far as certain premises are concerned. An amendment was accepted by the Minister there from this side of the House but that does not take us much further. We have a deep-seated objection to that principle being embodied in our legislation. We think that it is altogether wrong. If laws are to be amended or repealed that should be done by Parliament. It should not be done by proclamation, i.e. by the State President acting on the advice of the Minister, nor by the Minister or by any officials acting on his behalf by means of delegated powers. What we are afraid of is that Parliament is letting go of its power. Once the power virtually to initiate legislation by regulation is taken out of the hands of Parliament, the first fatal step has been taken. If laws are changed, if matters are not discussed and if the public is not given an opportunity of knowing what is happening their rights are thereby disturbed. We also have a rigid objection to the clause which provides that the Minister can instruct the Administrator of a province in regard to the establishment of a local authority. Provision is made in this Bill for the Minister himself to establish an advisory committee which, as its name implies, will be there for the purpose of advising the local authority in respect of whose area it has been constituted, because these advisory committees are only constituted within the area of a local authority. The next stage is to have the advisory committee metamorphised into a management committee. That will be what might be termed the lowest form of municipal life. It is not a municipality or a municipal institution as generally known in any of the provinces, it is something created by the Minister on an ad hoc basis. The Minister gives it powers and it is when we come to the allocation of powers that we really see how far-reaching the powers of the Minister are. Because he can take away powers from the existing local authority and confer them, in respect of the area in which the management committee is constituted, upon that management committee. Thereafter, on the instructions of the Minister, the Administrator will have to constitute that management committee into what I call an orthodox local authority, a local authority of the nature and kind which is recognized by the local government ordinances in the respective provinces. At this stage we want again to emphasize our objection to that particular power, the methods that have been designed by the Minister in this Bill for carrying out his purpose of getting local authorities constituted for groups other than the White group within the area of an existing municipality. Sir, we think that nothing but ill can come of such a concept as the Minister has set out in this Bill. It is going to lead to endless confusion. Because it involves financial relations between a newly created local authority and the existing local authority—a local authority that has already been established for a greater or lesser time— the relationship between the foundling, to put it that way, and the mother local authority, will, we are afraid, lead to interminable dispute, trouble and difficulty. Municipal finance does not go along lines like that. I think of Durban, for instance, and the surrounding areas which formed the subject of incorporation after very long investigation. There Indian areas were brought in under the Durban City Council and necessary finance was available because the White taxpayer had to pay. I realize how difficult it was to get an adjustment on that basis. When I look at the reverse position which is now forecast in this Bill whereby the Minister can determine that portion A or B of an existing municipality can simply be carved out and converted into a local authority of its own under conditions where the franchise rights of the inhabitants will be determined by him, where the members may be partly appointed and partly elected, thereafter as the local authority increases in importance and size, you realize, Sir, that they will eventually be handling the precise land, the water supply, the streets, the public transport, etc., which have been created by the local authority which is already in existence and out of whose body this new institution has been carved. I can understand the Minister in following Government policy is desirous of creating municipalities for Coloured people, Asiatics and, as we saw last year, even the Bantu. But this is not the way to do it, Sir. There has been inadequate consultation with the authorities who are going to be most intimately concerned. Unless the deputation which met the Minister a week ago saw this Bill in its entirety as it is before us, then no authority has seen this Bill in its entirety until that deputation came down here.

I can see a disapproving look on your face, Mr. Speaker, which warns me that I am getting very near the edge of the rule. I appreciate your generosity and the latitude you have allowed me to deal with a matter of this complex nature, Sir. I hope hon. members opposite, when their turn comes, seeing that they are so critical of me, will see to it that they stick strictly within the four corners of the rule.

As I have said, Sir, the Bill as such is unacceptable to us. It is not our way of doing things. These provisions give the Minister the power to set up these local authorities, and the plea is that this will be to the benefit of the Coloured people or the Indians as the case may be. But that is a barren plea, Sir. All that could have been done without placing this Bill on the Statute Book. Not one of the advantages which this Bill claims to confer on those people cannot be conferred upon them under existing legislation. We dislike this method, Sir. We are opposed to it in principle, and we shall, therefore, have to vote against it.

Mr. BLOOMBERG:

My colleagues and I intend voting against the third reading of this Bill. We will do so in order to record our last protest against what I have already described in this House as a wholly unnecessary and objectionable Bill, a Bill which deprives our Coloured people of their common franchise rights, rights which they have had in this province for over a century. Sir, there is nothing more that we can do in the matter. We have endeavoured to show the Government the folly of their proceeding with this Bill. We have attempted to argue with all the logic at our command that the main provisions of this Bill are wholly unnecessary and will be the means, I suggest, of further alienating the friendship and the goodwill of our Coloured people. We have appealed to the Government and particularly to the hon. Minister in charge of this Bill, to seereason in this matter. I am afraid that all our arguments and all our appeals have met with an even greater determination on the part of the Government to proceed with this measure with a total disregard of the serious consequences which must inevitably flow from this Bill. The main provisions of this Bill with which I am concerned to-day are those which provide for the establishment of so-called consultative and management committees and for the formation of so-called separate Coloured municipalities. It is quite obvious from the speeches we have had from the Government side of the House that the reasons which were originally advanced by the hon. the Minister for the introduction of this Bill, are not the true reasons behind this measure. The Minister had the temerity to suggest that this scheme of a state within a state offered to the Coloured people, I use his own words, “good neighbourliness and would form the basis for amicable human relations between the Coloured people and the White people in South Africa”. How the hon. the Minister can think that by herding the Coloured people into separate Coloured municipalities, as envisaged in this Bill, and making them subject to conditions which he, the Minister, would impose upon them, will produce amicable human relations is really beyond me. As the debate proceeded it became obvious, and no one, I think, can doubt it to-day in this House, that the true and only reason for the introduction of this measure is the fact that, in the opinion of the Nationalist Party, the Coloured people are fast becoming a threat to the political security of the White people in this province.

Mr. SPEAKER:

Order! The hon. member is now going right outside the contents of the Bill.

Mr. BLOOMBERG:

I want to deal with the contents of this Bill and show the House …

Mr. SPEAKER:

Then the hon. member must come back to the contents.

Mr. BLOOMBERG:

With respect, Sir, I am just introducing this point. I want to show that the contents to which I am going to refer in a moment is not going to have the effect which the Government thinks it will have in this country.

Mr. SPEAKER:

We are only concerned with the contents of the Bill.

Mr. BLOOMBERG:

Sir, surely it is the effect of the contents. I am trying to confine myself to the contents. It was made manifestly clear by several speakers on that side of the House, led by the hon. member for Moorreesburg (Mr. P. S. Marais) I think, that the real idea behind this Bill was that the Coloured people were gaining too much power.

Mr. SPEAKER:

Order! The hon. member must come back to the Bill.

Mr. BLOOMBERG:

I say that fear was the reason why the Government introduced this Bill. I want to ask in all seriousness where does the Government really think this is leading us to? One would have imagined that by this time, with all the difficulties with which we in this country are confronted, the Government would have realized that the time had come to call a halt to this type of legislation. One would have thought that the Government would not have attempted to do anything more which was likely to alienate a large section of our people.

Mr. SPEAKER:

Order! The hon. member is making a second reading speech. We are dealing with the third reading.

Mr. BLOOMBERG:

I appreciate that, Sir. Surely I am entitled to register my protest against the contents of this Bill and the effect those contents are likely to have on the country. I am endeavouring to do that, Sir. I am trying to show that the contents of this Bill are unacceptable.

Mr. SPEAKER:

The hon. member is not being very successful.

Mr. BLOOMBERG:

I am sorry, Sir. I am doing my very best to try to show that the contents of this Bill are so unacceptable that it will have a most deleterious effect on the future of our country. What possible advantages can there be in creating separate Coloured municipalities? That is what this Bill provides for. In terms of this Bill, taken at the very most, these Coloured municipalities will only be municipalities in name. They will in any case be under the direct control of the Minister and of the neighbouring White municipalities. That is provided for in this Bill. The Government has carefully conceived this Bill so that at all times the control of the affairs of the Coloured people will remain in the hands of the Government. That, Sir, is the effect of the contents of this Bill as I see it. The establishment of these consultative and management committees at first blush would appear to vest in these committees complete autonomy, but that is far from being the case. If you examine the provisions of this Bill, Sir, whereby these consultative and management committees will be established, it will be seen that there is nothing in the Bill which obligates a local authority to act on the advice of those committees. All that this Bill provides for is that the local authorities shall give due consideration to the suggestions which they may from time to time receive from these committees which the Minister will establish. I say that this amounts to absolutely nothing. One can well imagine what amount of consideration these White municipalities will give to any of the suggestions emanating from these Coloured committees.

In regard to the powers which this Bill seeks to give to these committees, these powers, in terms of the Bill, will be determined by the hon. the Minister himself without reference to anyone. And the powers and functions which he will determine will be carried out under the control and supervision of a White local authority and subject to such conditions as he, the Minister, may impose from time to time. I ask the Minister again in all seriousness what sort of autonomy is that which he proposes to give to these Coloured municipalities? Does the hon. the Minister really think that the Coloured people, and indeed a large section of the White people of this country, do not realize that all this is only eye-wash on the part of the Government. As though that was not sufficient, in terms of this Bill the Minister reserves to himself the special right at his sole discretion to disestablish these consultative and management committees as and when he likes. One can well imagine how long these committees are likely to remain in existence if they dare to take one single step which does not meet with the Minister’s approval. Again, Mr. Speaker, as though all this is not sufficient, in terms of Section 43bis the Minister takes unto himself the right at his sole discretion again, without reference to anyone, to make regulations prescribing the qualifications of the Coloured people which will be required for either voting or becoming members of any of these committees and of ultimately voting in these Coloured municipalities. To my mind this is the most dictatorial aspect of the entire Bill. I would imagine that this is unheard of in any civilized country. It amounts to nothing less than this that in respect of the present municipal franchise which the Coloured people have enjoyed in the Cape Province for over a century, the Minister is breaking down the whole structure of that common franchise right and the future destiny of these people as far as the municipal franchise is concerned is now left entirely to the discretion of the Minister. I regard this as the most obnoxious aspect in this Bill, a Bill which has already very aptly been described in this House as inhuman. Mr. Speaker, can you imagine what an outcry there will be if the ratepayers of a White municipality were told that they were going to be deprived of their municipal franchise rights, as the Minister is doing in terms of this Bill in the case of the Coloureds, and that the Minister will in due course, at his sole discretion decide upon the qualifications of the voters and of their councillors? Sir, I shudder to think what the reaction of the White voters will be. But this is exactly what the Minister is doing to the Coloured ratepayers of this Province in terms of this Bill whose third reading we are asked to pass this afternoon. In place of the present municipal franchise the Coloured ratepayers are being told that some day, in terms of Section 43bis of this Bill, the Minister will make regulations, without reference to Parliament and without reference to anyone—it is true that ex post facto he will present his regulations to Parliament—prescribing the qualifications for voting or for becoming members of these so-called committees and local authorities. I ask this House in all seriousness, can anyone imagine anything more objectionable than to leave the fate of these people in the hands of the Minister? To my mind this is even worse than many of the predecessors of this Bill. At least in other Bills where rights have been taken away from the Coloured people they were told in black and white what rights they were going to have instead of the rights that were being taken away from them. In this Bill they are being left entirely to the mercy and to the whim of the hon. the Minister.

I want to conclude by reading an extract from an article which appeared a week or two ago in the Cape Times written by one of the Coloured leaders in relation to this Bill. It was written by Dr. van der Ross.

Mr. SPEAKER:

Order! What has that got to do with the third reading of this Bill?

Mr. BLOOMBERG:

This article deals with the present Group Areas Amendment Bill, 1962, which we are being asked to pass this afternoon. This is what he says—

But in the list of the worst laws ever, the Group Areas Act continues to stand well towards the top …
Mr. SPEAKER:

Order! That has nothing to do with the third reading of this Bill and the hon. member must obey my ruling.

Mr. BLOOMBERG:

Very well, Sir. I just want to say that the present Group Areas Amendment Bill carries on the bad work of an unfortunate Act that was passed in this House, and I shall vote against it.

Mr. M. L. MITCHELL:

Apart from agreeing with everything that the hon. member for Peninsula (Mr. Bloomberg) has said I do not want to deal with his speech. It is a pity, Sir, that this Bill has emerged from the Committee of the whole House in substantially the same form in which the hon. the Minister has introduced it. I want to say that it is the worst, the most far-reaching Bill amending the principal Act, that has ever been brought before this Parliament. Furthermore, I believe that it is the most dangerous. And it is especially dangerous because it recognizes that the Group Areas Act is in fact the “Grondwet” of the doctrine of apartheid practised by this Government.

This Bill uses the machinery and the concept of the Group Areas Act in an attempt to foster a brand new brainchild of apartheid.

Mr. SPEAKER:

Order! The hon. member must come back to the contents of the Bill.

Mr. M. L. MITCHELL:

Mr. Speaker, I was leading up to Clause 22 which provides for, what I might call a new brainchild of apartheid, local authorities within local authorities. The Group Areas Development Board as well will in future, as a result of the contents of this Bill, be guided by a completely new consideration. It is a third dimension which is introduced by this Bill into the consideration of development of group areas, and that is the setting up of local authority machinery in each group area. In other words, the contents of this Bill provide now that in future group areas will be determined with a view to making each group area a viable unit governmentwise. [Interjections.] I do not wish to indulge in a little repartee with the hon. members. We have heard about third dimensions, but there are fifth things as well which hon. members opposite should not forget.

This means that completely new considerations will now play their part in the determination and the fixing of group areas. The greatest difficulty, the greatest factor which is presented by this Bill is the economic difficulty. Another one is that the future development of group areas will have to depend on the co-operation of the local authority within whose area of jurisdiction the new local authority as envisaged in Clause 22 is to be situated. It involves and affects the development of every urban community in South Africa. It is to that end, I believe, that Clauses 34 and 35 especially have been introduced into this Bill. Those two clauses do in fact give the Minister the power to exercise all the functions of the Group Areas Board through his chosen civil servants. Those clauses give the hon. the Minister or his chosen single servant the power of developing a group area. That is what those clauses provide for. The powers which are given, very significantly, if one reads these clauses together with Clause 22, to these single servants of the hon. the Minister, are to dispose of the affected properties in a group area, to develop group areas. Imagine, Sir, the enormous power that is granted by these clauses. They are given the power to acquire immovable property, to develop immovable property and the power to provide for that immovable property, to provide amenities and services. They are given the power to provide, to lay out, to plan, to develop any land belonging to the Board. They are given the power to construct roads, streets, drains, sewers, water mains, etc., and they are given the power to reserve or set aside property for open spaces or other public purposes. They are also given the power to build houses or other structures, grant leases over those, to grant loans, to advance money, make available materials for any purpose which, in the opinion of the Board, which now means in the opinion of the hon. the Minister, will contribute to the attainment of the objects for which the Board has been established. Sir, that is why I say that is what this clause means. That is why these clauses are there. Because all the powers which are given by Clause 35 relate to the sort of thing that you have to establish—houses, roads, public places and so on, which it is now necessary to establish and to have regard to, because in future the group areas will be declared in accordance with whether or not they can or cannot be viable units.

Instead of providing for ordinary sort of areas which the Group Areas Act intended should be provided, all these areas are now to be developed regardless of those circumstances, but rather with a view to establishing these local authorities within local authorities. I want to say that the hon. the Minister, whether he uses the Board or whether he uses the single civil servant as envisaged in Clause 35, or if he uses a whole army of civil servants, will fail to put into effect what he hopes to put into effect with this Bill. The hon. the Minister will fail because this Bill envisages that these areas within areas are going to be socio-economic viable units. No amount of thinking that is so is going to make it so. The hon. the Minister knows it. He knows he is going to fail. He knows that if he does not have the support of the local authorities he is going to fail. He provides in this clause for a situation which is going to give him a hand to force the local authority to do this. He knows that he cannot do it without their help and support. He knows that he cannot pay for it and it does not even make any provision in the Bill to pay for it.

Mr. SPEAKER:

Order! The hon. member must not read things into the Bill which are not there.

Mr. M. L. MITCHELL:

It does provide in Clause 22 that the Minister may lay down what the duties of local authorities are, i.e. the local authorities now established or any proper existing local authorities like the Durban City Council. He may provide what duties they may have in these new units within units he will create. I want to ask the Minister to tell us what sort of duties he has in mind. Does he have financial duties in mind? I believe he does, because if he does not this Bill can never come to mean what it is intended to. This Bill will bring nothing but unhappiness for the non-Whites in the urban area. The contents of this Bill indicate the establishment of these local authorities which will, when established, place a financial burden on the inhabitants of those areas which they should not be asked to shoulder, and which obviously they cannot afford to shoulder. It is true that the Bill does give a sort of franchise to the inhabitants of these areas, but it deprives them of all the normal amenities to which they have been used under the local authorities system as it exists. I must say it is a very poor recompense to have the right to vote for a shrivelling, bankrupt local authority …

Mr. SPEAKER:

Order! The hon. member must come back to the Bill.

Mr. M. L. MITCHELL:

This Bill is an admission that the old group areas machinery has failed. I say that because the contents of this Bill indicate that the Minister is taking unto himself all the powers that were formerly exercised by the Group Areas Board.

HON. MEMBERS:

You have said all that before.

Mr. SPEAKER:

Order!

Mr. M. L. MITCHELL:

Yes, but it obviously had no effect on you. The whole of the group area machinery in this Bill will now be directed by the Minister. The powers he is taking are astonishing. It is provided, for example, that if the Minister does not want anyone to know what he is doing in relation to certain matters he in his discretion can say that the matter is not to be published. No notice is to be given to persons affected by it.

The MINISTER OF COMMUNITY DEVELOPMENT:

You are talking utter nonsense.

Mr. M. L. MITCHELL:

No, it is in the Bill. In respect of certain matters the Minister can exercise his discretion not to publish. That is in Clause 3. Perhaps the Minister in his reply will say that is not so.

The MINISTER OF COMMUNITY DEVELOPMENT:

We have had experience of your facts during the second reading.

Mr. M. L. MITCHELL:

The Minister is now getting very cocky.

Mr. SPEAKER:

Order!

Mr. M. L. MITCHELL:

I withdraw that. The Minister is now suggesting all sorts of things he would not suggest in the Committee Stage when we could answer him.

Mr. SPEAKER:

Order! The hon. member must now come back to the Bill or else resume his seat.

Mr. M. L. MITCHELL:

Clause 35 provides that the Minister can completely ignore the Group Areas Development Act and he can appoint a committee of one to do the work of the Board, his own man. Standing and ad hoc committees can perform any function of the Board, and in his discretion he can determine what powers and functions consultative committees are to have, who will be members of these bodies and what duties they are to perform. This reverses all the legislation in regard to group areas and it reverses the process of democratic government.

Mr. SPEAKER:

Order! The hon. member must come back to the Bill.

Mr. M. L. MITCHELL:

The Minister has said that he will provide some sort of consultation, but unfortunately it does not appear in the Bill and it is much to be regretted that it is not in the Bill. The Minister is now taking power to make different regulations for different areas. In other words, he admits that different areas must have different regulations. That being so, one would have expected that those areas, with their experience of local matters and local difficulties, would have made the regulations, but no, the Bill provides that the Minister sitting in Pretoria will make all these regulations. No consultation is provided for.

Mr. SPEAKER:

Order!

HON. MEMBERS:

Try again.

Mr. M. L. MITCHELL:

The contents of this Bill … [Laughter] …, especially Clause 22 and Clause 28, completely undermine local government in South Africa. I think this is the first time in the history of the country …

Mr. SPEAKER:

Order! No, I cannot allow the hon. member to continue. We are not concerned with that, but with the contents of the Bill.

Mr. M. L. MITCHELL:

I will end on the note on which the hon. the Minister began.

Mr. SPEAKER:

Then the hon. member must move the third reading, because that was the whole of the Minister’s speech.

Mr. M. L. MITCHELL:

I will end on the note that the Minister, in terms of this Bill, may now provide not only what powers these local authorities may have but also what machinery must exist and in that regard I must say that my attitude towards this whole Bill is affected by what the Minister said, that in Natal we are going to have this whether we like it or not.

Mrs. SUZMAN:

Before I deal with the third reading, Sir, may I have your guidance on the grounds one may cover in the third reading? I know, Sir, that you have told us that we may deal with the contents of the Bill, but the contents of this Bill consist of a large number of clauses. What I am trying to find out is whether one may deal with the effect of the clauses in the Bill, and to offer further arguments at this stage whether the third reading should or should not be passed.

Mr. SPEAKER:

I think the hon. member has the rules in front of her.

Mrs. SUZMAN:

But I find it very difficult to ascertain exactly what the contents of the Bill are if it is not the actual clauses, and I want to discuss some of the contents of the clauses of the Bill.

Mr. SPEAKER:

This is neither the opportunity nor is it expedient for me to explain the rules to hon. members, but I will guide the hon. member as she goes along. She may proceed.

Mrs. SUZMAN:

I would like to commence by saying that no change has been introduced into this Bill in the Committee Stage or in the Report Stage which in any way changes my objections to the measure as it came to us in the second reading. There have been no changes which now make me feel that this Bill ought to pass its third reading. As far as I am concerned, the same situation obtains now as before, and I have the same objections to the contents of this Bill in the third reading that I had originally.

The contents of the Bill deal with two or three important principles, the most important of which, to my mind, is that the Bill is a pegging measure for the franchise rights of the Coloureds in the Cape in the municipal field. It is a way whereby the Minister can get around the difficulties he will encounter.

Mr. SPEAKER:

Yes, but the hon. member will know that at the second reading the principle was adopted, and it cannot be discussed in the third reading.

Mrs. SUZMAN:

Clause 28 contains that particular principle.

Mr. SPEAKER:

That principle has been agreed to.

Mrs. SUZMAN:

All I can say at this stage is that I have the same objections, that the Bill is aimed at undermining the franchise rights of the Coloureds and the autonomy of the provinces, and the Minister has not made clear to us any of the functions he intends to hand over to the management committees he will appoint and, therefore, I shall vote against the third reading of the Bill.

Mr. GAY:

Like the last speaker, the Bill now before us for the third reading, in my opinion, differs in no important respect from that placed before the House in its earlier stages, and the official Opposition therefore are moving no amendment to this Bill. The Bill is too bad to be improved, and we simply intend to vote against it. Although the Minister has met certain minor objections, he has failed to meet any of the major objections we put up to him and, therefore, it is quite impossible for us to support the Bill. Reference has already been made to the fact that the Bill provides that powers previously held by the board will now be taken over by the Minister under delegated authority. On the very first page, Clause 1, in the definitions, it provides immediately that the Minister, under certain delegated powers, now takes the place of the board with regard to carrying those powers into effect. It goes further. In Clause 3 it provides that, where the board previously did certain things, the Minister now can delegate his powers to the secretary to do these things, and the term “secretary” will now be used in lieu of “the board”. The secretary now has the power to take decisions and make pronouncements hitherto only done on the advice of the board. When we proceed a little further …

Mr. SPEAKER:

Yes, but it is not the intention at the third reading to take the Bill clause by clause and paragraph by paragraph and examine each item separately.

Mr. GAY:

I agree, and I have no intention of doing it, but I am referring to certain of the more important provisions, as part of the contents of the Bill. There are certain fundamental paragraphs in the Bill which are highly objectionable to us, and it is those points I wish to deal with. In Clause 3 (b) it provides that where previously in the Group Areas Act the power was vested in the board, it is now vested in the secretary. That is one thing we cannot accept. It is handing over to one individual the power previously held by the board, which had a very wide authority, and which had all the means at its disposal to get information and evidence which guided them in making decisions. That is our objection. When we come to Clause 6, there again we see that the secretary not only takes over a very wide range of delegated powers from the board, but he also has the authority to further delegate these powers to an official, a member of the Department of Community Development, and in effect the secretary has power to vest the board’s authority in an official of the State. Again that is one of the fundamental objections we have to the Bill. Clause 8 is one which the Minister in the earlier stages accepted an amendment to. It deals with the penalties to be applied in the event of certain misdeeds by the officials or the members of the board. The Minister has accepted from us the recommendation to increase the penalty to imprisonment not exceeding three years, and also the vital provision that thereafter any convicted persons will be prohibited from holding office under the Group Areas Act. There the Minister has gone some way to meet us, but it is only a minor matter when you contrast it to the other powers delegated by the Bill and in regard to which the Minister has not seen fit to accept an amendment. Clauses 22 and 28 are two of the important clauses we object to. Clause 15, despite all the argument we advanced to try to persuade the Minister to alter it, is a clause which deals with the granting of permits, and it still retains the coercive factor which should not be included in any legislation passed by this House. It is the clause which gives authority, delegated authority, to act and to allow a person a permit to occupy one piece of his property provided he vacates another piece of his property.

Mr. SPEAKER:

That is not relevant.

Mr. GAY:

That is the feature in this clause that we object to. No sword should be kept hanging over any man’s head when he applies for a permit. The clauses in between are merely consequential to the change in status consequent on our becoming a Republic. Coming to Clause 22, it is one of the two main clauses introducing two new aspects which again we cannot accept. It deals with the effect of this legislation on the Provincial Administration and sub section (3) seriously curtails the powers of the local authorities in carrying out their legal duties in their own areas. It provides that a local authority cannot carry out certain functions …

Mr. SPEAKER:

Order! The principle has been accepted in the second reading.

Mr. GAY:

I am dealing with our objection to the clause as it is, which prohibits a local authority from functioning as it did before.

Mr. SPEAKER:

That principle has been agreed to.

Mr. GAY:

In Section 25bis (1) again there is a very sweeping authority to the Minister that he may appoint committees to carry out investigations and submit evidence to him regarding the desirability of setting up the second of these committees, the management committee. I do not want to deal with the principle, viz. that the method of carrying out these powers results in a nominated committee with a nominated chairman to take over powers from the existing local authorities, again undermining the system of local authority. In sub-section (5) (a)—that is the section which led to considerable discussion which I do not want to repeat. I merely point out in passing that clause gives the State President, i.e. the Cabinet, the authority to alter the law in connection with the municipal qualifications, particularly in the Cape, and we cannot accept that under any conditions. That is another of our standing objections.

Mr. SPEAKER:

Order! The hon. member must come back to the Bill.

Mr. GAY:

I am trying to keep well within your ruling, Sir, and I appreciate your assistance. One of the consequences of that clause has already taken effect. I want to draw the Minister’s attention …

Mr. SPEAKER:

Order! The hon. member is now moving on to dangerous ground. He must come back to the Bill.

Mr. GAY:

I notice that one of our local authorities has already trodden on dangerous ground …

Mr. SPEAKER:

Order! The hon. member must not follow it on that dangerous road.

Mr. GAY:

Clause 28 provides that the Minister may make regulations as to the manner in which any consultative or management committee is constituted and it provides certain other powers for the Minister to deal with those committees. I again draw the attention of the House to the fact that we are giving a blank cheque to the Minister and nowhere in the Bill is there the slightest indication of what conditions he will impose.

Mr. SPEAKER:

I can see that the hon. member has a good conception of the rules, but he should just keep within the rules.

Mr. GAY:

On page 13 there is another provision to which we object because we feel that it will obstruct the Administrator and it undermines the provincial government system. One of the last clauses …

HON. MEMBERS:

Hear, hear!

Mr. GAY:

Mr. Speaker, I think you will bear with me for a moment when I draw your attention to the type of interjections we are having. There are 1,500,000 Coloureds …

Mr. SPEAKER:

Order! The hon. member cannot discuss that and he should not waste his valuable time replying to interjections.

Mr. GAY:

You will not allow me to say that the attitude of hon. members opposite reveals their complete contempt …

Mr. SPEAKER:

Order! The hon. member must come back to the content of the Bill.

Mr. GAY:

Clause 35 allows the Minister to appoint committees and to delegate his powers to those committees, and again this is a clause to which we have fundamental objections. The hon. the Minister can appoint one-man committees and he can replace that man if he is found unsatisfactory half way through the deliberations of the committee. If one man falls sick he can replace him, and he can nominate the chairman where there is more than one man, and again it is making a complete farce of setting up these committees.

Mr. SPEAKER:

Order!

Mr. GAY:

I think I have said enough to show where the objection of this side of the House lies. We do not believe it is for the good of the country and it is certainly not for the good of the Coloured people.

Mr. SPEAKER:

Order! I cannot allow the hon. member to proceed.

Mr. GAY:

Then I conclude by saying that our objections to the Bill, which have been expressed since the day the Bill was first introduced, have not been lessened by any concessions or explanations on the part of the Minister. We believe it is a bad Bill which cannot be improved and we intend to vote against it.

Mr. BARNETT:

It seems to me that the battle for the third reading has begun, and in order that I may know exactly what I can cover I want to quote to you, Sir, from Kilpin on “Parliamentary Procedure”, where he says, at page 13—

At the third reading the House considers the Bill in its final form and determines whether it ought or ought not to become law.

In other words, this House is now required, according to Kilpin—and I ask your ruling on that—to ask itself whether this Bill ought or ought not to become law. I submit with the greatest respect to you, Sir, that in view of the doubt which exists I should be able to show …

Mr. SPEAKER:

Order! Is the hon. member addressing me on a point of order?

Mr. BARNETT:

Yes, Sir, I am raising a point of order as to whether we are entitled to use arguments …

Mr. SPEAKER:

Order! I have given the hon. member an opportunity of addressing the House; he did not say that he was rising on a point of order.

Mr. BARNETT:

All right, Sir, then I will address the House on the Bill. I believe that this Bill should not become law, that it ought not to become law for certain reasons, and one of the reasons is that it takes away once and for all from the Coloured people the right to be on a common franchise municipal roll with the Europeans. That is one reason why it ought not to become law. Another reason is that it gives power to a Minister to override the Administrator of a province.

Mr. SPEAKER:

Order! That principle was accepted at the second reading.

Mr. BARNETT:

Well, there I have it! Now I want to take the point—and here I want to ask for your guidance—whether Kilpin is right or wrong, according to your ruling—and I say this in all sincerity and with the great respect which I have for the House and for you—whether we must be guided by Kilpin …

Mr. SPEAKER:

Order! The hon. member must be guided by the Chair.

Mr. BARNETT:

Very well, then Kilpin will be put away; I will not read it again. That puts an end to Kilpin. Sir, I say with respect, and you will forgive me at this stage for saying it, that nobody seems to know what one is allowed to say at a third reading and it is high time third readings were done away with in this House; it is a waste of time.

An HON. MEMBER:

What clause are you referring to?

*Mr. SPEAKER:

Order! It is difficult enough for me without these interjections to control the debate and I hope hon. members will give me an opportunity to do so. These interjections do not facilitate my task.

Mr. BARNETT:

I just want to conclude by saying that as Coloured Representatives in this House we believe that this Bill is unfortunate; that it has not been asked for by the Coloured people; that it will further broaden the gulf between the Coloureds and the Europeans; that it will mean that once more under this Bill a Minister will have the power to do away with the normal rights of people to elect their representatives. The Minister will have power to nominate people. May I say that it is a great pity that we have to have a third reading of a Bill when the Minister has told us that he has certain important amendments; it is a pity that this House will have to pass this Bill when the Minister knows that certain amendments are going to come forward later on. If we had been told what these amendments are, it might have changed our attitude in many respects, particularly since the Minister says that these amendments flow from an interview which he had with the people in Durban. I say it is a pity that the Minister did not answer many of the questions put to him. I can only say that we propose to show our disapproval of this type of legislation by voting against the third reading.

Mr. THOMPSON:

This side of the House has put on record in very clear terms its many objections to this Bill on many grounds, but particularly on the ground that it takes away a right from the Coloured people. And although it gives something in its place, we are firmly of the view that what is put in its place will not be accepted as good enough. We have had no evidence from the hon. the Minister that the Coloureds have changed in their attitude of opposition to this Bill. We opposed this Bill for several days at the second reading and in Committee. Our feelings were expressed very clearly on that point. Since that time our feelings have become even stronger because yesterday we had a Budget of mammoth military proportions. One must therefore see the effects of this Bill …

Mr. SPEAKER:

Order! The hon. member cannot raise a matter of that kind at the third reading.

Mr. THOMPSON:

I am thinking now of the effects of the provisions of this Bill.

Mr. SPEAKER:

Order! That has nothing to do with the contents of this Bill.

Mr. THOMPSON:

Let me then say this that the House, when judging the effects of Section 22bis which, as you know, Sir, has certain important provisions affecting the Coloured people, must consider those provisions against the background which was to some extent unfolded yesterday.

*Mr. J. E. POTGIETER:

On a point of order, the hon. member is now discussing this Bill against a certain background which I submit he is not entitled to do at a third reading.

Mr. SPEAKER:

Order! If the hon. member refers to rule 180 of the Standing Rules and Orders he will see that his remarks must be confined to the contents of the Bill.

Mr. THOMPSON:

I am indebted to you, Sir, for your ruling. I do not want to dwell any more upon that matter, and indeed I only want to move now from, you might say, the sublime to a very small point. And that is that I sincerely hope that the hon. the Minister in administering this measure will ever keep in mind the sentiments to which he gave expression here in regard to the close association and consultation with which he will work with the Administrators of the various provinces. As you will know, Sir, in many of the provisions of this Bill the wording “in consultation with the Administrator” appears, and although, of course, we much prefer the old wording of “with the concurrence of the Administrator” we appreciate that this is now passing into law. We sincerely trust that the hon. the Minister will very much bear in mind the reply which he gave to an interjection, namely that he would seek at all times rather to persuade Administrators than to do anything else.

One other tiny point is that I sincerely hope that the hon. the Minister will not be emboldened by the acceptance by this House of a clause which gives the State a privileged position so far as the ordinary law is concerned to come with further provisions of that kind. I refer to Section 18 (3)ter, which is introduced by Clause 47. That was touched upon at the Committee Stage, and the hon. the Minister gave his explanation for the appearance of that clause. I think he will not dispute it if I say that his case in support of it was not very strongly made out. I sincerely hope that he and his Department will not seek for privileged positions of that kind in regard to matters of detail such as are contained in that sub-section.

Then just in conclusion one must say that one does not envy the hon. the Minister his task in attempting to administer this Act. He is embarking upon a course of unscrambling a situation which has existed for very long. One appreciates that there are many clauses of the Bill which will constitute him a constitution-maker. He will have power by regulation to lay down the qualifications for voting; he will have the power to disestablish committees; he will have the power to establish committees. It is quite clear that so far as constitution-making is concerned, he is going to enter upon virtually a virgin field. We certainly do not envy him his task, and we only trust that it will not be as fraught with difficulty and with unfortunate consequences as we fear.

*Mr. STREICHER:

When you come to the third reading and ask yourself whether or not to vote for it, I think that in view of the fact that certain questions put to the Minister during earlier stages have remained unanswered, I am inclined to put certain further questions to the hon. the Minister, particularly in regard to Section 25bis. The hon. the Minister will have the opportunity of appointing a committee to investigate whether or not a management committee can convert itself into a local authority. I wish to put this question to the hon. the Minister: When the committee investigates the question of whether such a management committee which has succeeded an advisory committee, can convert itself into a local authority, why is the White local authority in whose area the Coloured area falls, not allowed to have representation on such a committee? I admit that in terms of 2 (a) the Administrator will at least have somebody on that committee as his representative. But as you know, Sir, the Administrator of a province is not the only person who is concerned in that local authority; the local municipality is also concerned in it; and if this clause became law it would mean that the local authority need not be consulted by the hon. the Minister.

*Mr. SPEAKER:

Order! Those questions which the hon. member is asking should have been asked in the Commitee Stage. We are taking the third reading.

*Mr. STREICHER:

Mr. Speaker, you are quite right in saying that these questions should have been asked, but it was purely by accident that I noticed that this question had not been replied to.

*Mr. SPEAKER:

If the hon. member omitted to ask the question in the Committee Stage it is his affair. The opportunity to ask questions is past.

*Mr. STREICHER:

I admit that, Sir, but when the matter was discussed in the Committee Stage I unfortunately did not have the opportunity of appearing in this House.

*Mr. J. E. POTGIETER:

A neglect of duty.

*Mr. STREICHER:

As I have said, 2 (a) …

*Mr. SPEAKER:

Order! The hon. member should have raised that point in the Committee Stage.

*Mr. STREICHER:

No, Sir, I am not going to enlarge upon that any further. In terms of sub-section (3) the Minister may order in writing that a local authority of a type specified by him be established. How can the Minister have a local authority of a type specified by him established if he has not got the report of a committee on which the White local authority did not also have representation at his disposal?

*Mr. SPEAKER:

Order! The hon. member is dealing with a stage which does not come under the third reading.

*Mr. STREICHER:

Mr. Speaker, I accept your ruling wholeheartedly and I shall try to abide by it as far as possible. As I have said, that is one of the questions which I wanted to ask the hon. the Minister.

*An HON. MEMBER:

You will not get a reply at this stage.

*Mr. STREICHER:

Section 25bis (5) provides that the State President may, by proclamation in the Gazette, at any time repeal, alter, amend or modify any law relating to or in connection with the requirements to be complied with in order to become a member of any local authority.

*Mr. SPEAKER:

Order! It is not necessary for the hon. member to read the Bill; we have the Bill before us.

*Mr. STREICHER:

The point I want to make is this: Was it not necessary that we should have known the reason …

*Mr. SPEAKER:

Order! I cannot answer such hypothetical questions at this stage. The hon. member must confine himself to the contents of the Bill, otherwise he must resume his seat.

*Mr. STREICHER:

I will find it particularly pleasant to resume my seat, Sir, but I just want to say this in conclusion that the Coloured people who have had the municipal franchise in the form in which we know it, will, because of this legislation, again have to start at the advisory committee stage. In other words, as far as they are concerned this is a retrogressive step. This Bill does not make provision …

*Mr. SPEAKER:

Order! We are not dealing with that. We are dealing with matters for which the Bill does make provision.

*Mr. STREICHER:

I admit that it makes provision for the Coloureds to start at the advisory committee stage, thereafter a management committee and eventually a local authority. For those who already have the vote this Bill means that they will lose that franchise. That is the main reason why I am against it.

Mr. RUSSELL:

Sir, will you allow me to raise a point of order in relation to this third reading rule? I speak now from 20 years’ experience of the rules of debate in this House. It is of course our desire as an Opposition to discuss this Bill under the rules of Parliament as sensibly and constructively as we can. In all this time, on the numerous occasions in which I have taken part in third reading debates on various Bills, I have had no difficulty until the new ruling of 1960. Mr. Speaker, I am not the only one who has never yet quite understood what this new ruling means. It says that one must confine oneself at third reading to the “contents of the Bill”. What does that mean? Does it literally mean that we can re-examine, clause by clause, the contents of each Bill—and then criticize the contents of those clauses? Is there a real reason for the third reading, or is it a mere formality? I would like you to correct me if I am wrong because it seems to me that Parliament becomes a farce if experienced parliamentarians with legal training do not understand a ruling; and quite candidly no one here present does understand this ruling. We have no desire to go against your decisions, but we must be able to understand where and how we err. In the old days, as I understood it, a third reading was devoted to a re-examination of the Bill to determine whether, in the light of any alterations that might have been made in the Committee Stage, it ought or ought not to be accepted. If, in the Committee Stage, a Bill had been so altered that it changed the application of a principle of the Bill, one could even discuss that. Sir, can you now tell me what is meant by “the contents of a Bill”?

Mr. SPEAKER:

Yes, I can refer the hon. member to the minutes of 1 April 1960. There he will find it clearly set out in writing.

Mr. RUSSELL:

Could we have it interpreted for us, now?

Mr. SPEAKER:

Yes; the hon. member can go and look it up in the library, if he will take the trouble to read it.

Mr. RUSSELL:

I have taken the trouble to read Speaker Conradie’s ruling several times and I still cannot understand it. Nor can anyone in this House understand what it means or what scope it affords, if any.

Mr. GORSHEL:

In view of the very strong criticism which has been levelled at the Minister for introducing this Bill, I think it might be advisable to take a second look, as I propose to do, at some of the provisions in order to discover where the merits are in this Bill and I am going to confine myself to the contents of the Bill, obviously.

Mr. SPEAKER:

I hope so.

Mr. GORSHEL:

You and I, Sir, share that hope—I shall try at least to implement it.

The curious thing about Clause 22 is that the Minister appears to be endeavouring to carry out one of the most important principles of democratic government by providing for an extension of local government to a sphere where it does not at the present time exist; and in that particular context, without reference to groups or group areas, I think the Minister is well aware of the fact that local government is regarded as the very foundation of democratic government. Therefore I, for one, in dealing with this particular clause, cannot take exception to the desire or the intention of the Minister to extend the provisions of local government to such persons as do not enjoy it at the present time.

Mr. STANDER:

The Committee Stage.

*Mr. SPEAKER:

Order! Does the hon. member think that he is assisting the Chair in its difficult task? I hope that the hon. member for Hospital (Mr. Gorshel) will not return to the second reading debate because it is clear that he is moving in that direction.

Mr. GORSHEL:

Well, Sir, I may have been prejudiced by the interjection just now, which indicated that I was heading in that direction …

Mr. SPEAKER:

The interjection was made after the hon. member’s remarks.

Mr. GORSHEL:

No, Sir, with respect, up to that moment you and I seemed to be getting along quite well. The need to conserve that essential part of our democratic government is one about which we are all ad idem. Is it not competent—and I suggest it is—to examine the effects of the Bill in regard to the very mechanics of local government which are indicated in this Clause 22?

Mr. SPEAKER:

Order! We are concerned purely with the third reading of a Bill, the principle of which was accepted at the second reading and the details of which were thrashed out in the Committee Stage.

Mr. GORSHEL:

With respect, I am not at this stage taking any exception to the principle or trying to deal with it, but in view of the fact that the Minister has very wide powers within the contents of this Bill to provide by regulation and by promulgation for certain matters which are within the scope of the Bill and therefore become part of the contents, I think—with respect—that I am entitled to examine some of the effects of the contents of the Bill by the regulations it presages.

Mr. SPEAKER:

Order! We are simply concerned with the contents of the Bill.

Mr. GORSHEL:

Very well, I shall try to be as simply concerned with it as I can. I think the situation which the Minister may be prepared to consider is that which occurs when he establishes a local authority. Having established, in the first stage, the consultative committee, which has in turn been elevated or promoted to the status of a management committee (which steps form part of the provisions of this Bill), he then decides that particular management committee, for good and sufficient reason, should become a local authority.

Mr. SPEAKER:

Order! I warned the hon. member that he was preparing himself for a second reading speech.

Mr. GORSHEL:

Sir, I would not dream of doing that as I know that the second reading is behind us. What I want to ask the Minister is, on what basis of consideration does he decide that a management committee should become a local authority …

Mr. SPEAKER:

Order! That is a matter that has been disposed of. It was dealt with in the Committee Stage.

Mr. GORSHEL:

Very well, then I will not deal with it any further. Arising out of Section 25, I want to ask the Minister whether in the case of a local authority which, in terms of its normal organization has established within its own area a certain rateable value …

Mr. SPEAKER:

Order! That matter has nothing to do with the third reading at all.

Mr. GORSHEL:

Sir, may I put the question before you dispose of it?

Mr. SPEAKER:

I am sorry, I am not here to reply to questions.

Mr. GORSHEL:

No, I want your ruling on it, Sir, whether I am entitled …

Mr. SPEAKER:

Order! I have given my ruling on it.

Mr. GORSHEL:

Very well. Section 25 also refers on page 9 to the period of notice which must be given when a committee furnishes its suggestions or comments after having been requested to do so. It refers to seven days as being the period. I do not know whether the Minister has considered this as carefully as he has considered some of the other contents of this Bill because there are, as we all know, unforeseen postal delays. Here I am trying quite genuinely to help the Minister.

Mr. SPEAKER:

Order! That is a matter that should have been thrashed out in the earlier stages. It is quite outside the scope of a third reading debate.

Mr. GORSHEL:

Section 25bis (2) (a) provides for a committee which shall consist of not more than five persons of whom at least one shall be a person nominated by the Administrator of the province concerned. That is all very well and I have absolutely no objection to it. I merely want to ask the Minister, when he appoints the members of this Committee … [Laughter.]

Mr. GAY:

Hon. members opposite laugh about this legislation and yesterday they were asked to vote R120,000,000 …

Mr. SPEAKER:

Order! I want to appeal to hon. members not to make my task more difficult. The hon. member may proceed.

Mr. GORSHEL:

… in nominating or appointing the remaining members of the committee, as envisaged, whether he will not show the same consideration for the local authority that he has shown in another clause of this Bill, where he provides, for example, that certain things must be done with the consent of the local authority. I ask the hon. the Minister, when this clause has to be implemented, to consider not only the advisability but the necessity of ensuring that at least one person is appointed from the parent local authority, the senior local authority in this case, to consider whatever the committee is appointed to consider.

I think I should also refer to sub-section (3), where only the Administrator, apparently, is to be consulted. I think, with some limited knowledge of the workings of a Provincial Administration, that the Administrator himself would prefer to see the provision incorporated by regulation for the local authority, as well as himself (i.e. the Administrator) to be consulted. I am not going to deal—I am sure that members will be relieved to hear this— with any of the clauses following Clause 22, until I come to Clause 28 and here I would like to say a few words. This is a very wide clause. I say that in no spirit of criticism. It is, in fact, a wide clause, and I would therefore urge the Minister, when he has taken unto himself the power which this clause gives him and furthermore the powers which you may be sure he will have under the regulations, that the local authority should be considered to the maximum extent, and not in a superficial way. I think only on the basis of what it does to the Coloured voter in the Cape …

Mr. SPEAKER:

I have allowed the hon. member to make his appeal to the hon. the Minister, but he must come back now to the contents of the Bill.

Mr. GORSHEL:

Whatever may be said about the impact of the effects of the Bill, with which I believe you said I was entitled to deal since they arise out of the contents— whatever the effect may be on Coloured voters, past, present and future, it must be clearly borne in mind that this Bill will have a very important effect on existing local authorities. Sir, perhaps you will find dozens of cases in South Africa to this day where a group area for a certain group has yet to be determined within the confines of the local authority concerned.

Mr. SPEAKER:

Order! That is also outside the scope of a third reading debate.

Mr. GORSHEL:

Finally, dealing with Clause 43, I believe that the provision here that in addition to consultation with the Administrator of the Province, the consent of the local authority concerned must be obtained, is a provision which offsets or could offset, if properly implemented, a great deal of the criticism which has been levelled at the Minister. If this had been the spirit in which the other portions of the contents of the Bill had been framed, I for one believe that there would not have been so much criticism.

Mr. SPEAKER:

Order! I have allowed the hon. member to express his desire to assist the hon. the Minister but he must come back now to the contents of the Bill.

Mr. GORSHEL:

The contents of the Bill as such in relation to the workings of any major local authority in South Africa are of tremendous importance. Take for example an area such as the City of Johannesburg …

Mr. SPEAKER:

Order!

Mr. GORSHEL:

Sir, don’t you want me to deal with Johannesburg? Sir, I have heard people referring to local authorities in the Cape Peninsula, mentioning them by name, and I thought therefore …

Mr. SPEAKER:

Order! The hon. member must now confine himself to the third reading.

Mr. GORSHEL:

In that case, Mr. Speaker, I can only thank you for the indulgence you have shown me.

Mr. CADMAN:

If one looks at this Bill as a whole, that is the contents of this Bill as a whole, one finds that the whole, or a greater part of it, is in every way objectionable. Certain clauses, Clause 3 is one of them, are to a degree slightly less objectionable, and it has been said in these proceedings that one would have expected this side of the House in respect of those clauses at least to express a certain measure of thanks or commendation for the content of those particular clauses. But that I think is a strange point of view …

Mr. SPEAKER:

Order! The hon. member must not allow himself to be led astray by what was said. This is the third reading of the Bill we are dealing with now.

Mr. CADMAN:

No, Sir, I won’t be led astray by that, because you see it was expressed by the Minister, but coming to the particular clauses, of which Clause 3 is one, it is like saying to a man on whom you have set a pack of six dogs, when you have called off one of them, “You ought to be thankful”. That is the point of view that does not commend itself to those of us who have spoken against this Bill. But the objection mainly to the contents of the Bill is not only that the objects of these powers themselves are undesirable and objectionable, but the manner of their exercise is equally objectionable. It has been said in opposition to this Bill that, in sum, the objection is against a concentration of power in the hands of one individual, and I think that if one wants a summary of that objection, it can be obtained by looking at the contents of Clause 28, which has been touched on. By looking at the contents of Clause 28, whereby the Minister is empowered by way of regulation to make provision for a very wide field of endeavour, one comes to the conclusion that is really the high-light, or the depth (whatever one’s point of view is) of the whole of this Bill.

Mr. SPEAKER:

Order! I must draw the hon. member’s attention again to the fact that every speech in opposition to the third reading has dealt with Clause 28.

Mr. CADMAN:

Yes, Sir, it has been touched on by most speakers, but if you will allow me, Sir, it may perhaps be thought after I have dealt with Clause 28 that I have thrown light on that particular clause, as being representative of the Bill as a whole, which no other speaker so far has been able to do. For that reason I should like very briefly to illustrate my objections to the Bill as a whole, that is the contents of the Bill as a whole, by a brief reference to Clause 28, as it does tend to summarize the flavour of the Bill taken as a whole. Now the Minister is empowered in that clause to make regulations as to the manner of constituting management or consultative committees, as to the manner of electing their members, as to their tenure of office, as to the filling of vacancies, as to the holding of meetings, as to the procedure at meetings and as to the qualifications of voters, and finally, how these committees are to be consulted and as to the prescribing of the powers, functions and duties of such committees. I said that one could summarize one’s objections to the contents of this Bill merely by looking at this one clause. Every conceivable matter relating to these two types of local authority is to be dealt with by way of regulation, and the objection to that is not only the difficulty, as we said earlier, of finding one’s way through the mass of regulations of that kind, but that all this power can be put into effect without consultation, without any discussion, without being the subject of scrutiny by any legislative body, either of this House or of a provincial council, and although from the point of view of the person promulgating these regulations, they may be in every way desirable, it is so often found after such things have been the subject of debate …

Mr. SPEAKER:

Order! The hon. member is going too far now.

Mr. CADMAN:

All I want to say can be said in one sentence on this point, and that is that no amount of scrutiny of these things in an office by a number of individuals can show up the blemishes in those regulations as can a debate in a House such as this. That really is the principal objection to all these measures embodied in this Bill.

*The MINISTER OF COMMUNITY DEVELOPMENT:

Not much was said in this debate to which I can reply. The points raised here are all points to which I have reacted in the earlier stages. Suffice it therefore to say that this Bill as a whole really comprises four different characteristics and they are in the first place the clauses which, like Clause 3 and a few others, deal with the establishment of a Department; those clauses all facilitate the administration of the Group Areas Act, and not only facilitate it but speed up the administration. That is the first characteristic. The second is the characteristic contained in Clause 29, particularly (h), which is an outstanding feature of the Bill, namely the future handling of affected properties. Both to the Department and to the members of the public who are affected, this provision in the Bill is not only a great concession, but it facilitates the whole process. The third characteristic is contained in the provision by means of which a further attempt is now being made to eliminate all hard cases, or to make it possible that all hard cases can be eliminated. That is the provision dealing with the ex gratia payments. And in the fourth place—that was the main point around which all the objections in the Bill really turned, because the rest of the Bill was negatived right from the beginning, also in this debate, except by a few hon. members who did not stick to the facts when they made certain allegations, like the hon. member for Durban (North) (Mr. M. L. Mitchell)—there is the characteristic contained in Clauses 22 and 28. In this regard I just want to add this to what I have already said, that these clauses now introduce a new deal right throughout the Republic whereby consultation and discussion can take place on local Government level. Nobody can deny that right throughout the Republic this introduces a new deal in regard to consultation and discussion at local government level. In the second place a foundation is being laid here which makes possible the concept of administrative rights in their own circle and which sets no limits to the consequences of it. In other words, the same opportunities the White man had to develop from the lowest level of administration to the highest in the local government sphere are now being made possible for the Coloureds and the Indians in their own area. Finally, this Bill establishes the methods by which there will be the best opportunity for the Department of Community Development, which is intensely concerned with every local government and every Provincial Administration with whom there are continual consultations, and it creates that opportunity for consultation. In fact, without consulting all those bodies, no group area can be established. That consultation between the Department of Community Development and the Provincial Administrations and the parent local authority concerned is being made possible and much more effective by this Bill, and it therefore lays the foundation for proper channels right from the Central Government to the local government by means of which this consultation can take place.

I just wanted to mention these four points because, whatever may have been said by the opposite side of the House, these four points cannot be controverted. In this connection the hon. member for Hospital (Mr. Gorshel) emphasized the point that the local authority under whose jurisdiction such a consultative committee or management committee will be established ought to be represented in the consultative body, as well as on this committee of investigation. But of course as I have said right throughout the debate, I have said during the second reading and also during the Committee Stage, that at no stage do I want to ignore the local authority, and that I will not dream of taking any action without consulting them. But of course it is no use telling hon. members that.

That is what I told the Municipal Association which interviewed me, and to make it quite certain now, that is one of the amendments I will introduce.

*An HON. MEMBER:

Yes, now.

*The MINISTER OF COMMUNITY DEVELOPMENT:

But I repeatedly said so. I wish to conclude. This Bill, as we have it before us to-day, has evoked one protest throughout the whole country, apart from hon. members opposite. There was one voice of protest, and that is what the hon. member for Peninsula tried to read out. For the rest, not a single word of protest was received by any of my departments verbally or in writing or by way of resolution.

Motion put and the House divided:

AYES—87: Badenhorst, F. H.; Bekker, G. F. H.; Bekker, H. T. van G.; Bekker, M. J. H.; Bezuidenhout, G. P. C.; Bootha, L. J. C.; Botha, H. J.; Botha, M. C.; Botha, P. W.; Botha, S. P.; Cloete, J. H.; Coertze, L. L; Coetzee, P. J.; Cruywagen, W. A.; de Villiers, J. D.; Diederichs, N.; Dönges, T. E.; Faurie, W. H.; Fouché, J. J. (Sr.); Fouché, J. J. (Jr.); Frank, S.; Greyling, J. C.; Grobler, M. S. F.; Haak, J. F. W.; Hertzog, A.; Heystek, J.; Hiemstra, E. C. A.; Jonker, A. H.; Knobel, G. J.; Kotze, G. P.; Kotzé, S. F.; le Roux, P. M. K.; Loots, J. J.; Luttig, H. G.; Malan, A. I.; Malan, W. C.; Marais, J. A.; Maree, G. de K.; Maree, W. A.; Martins, H. E.; Meyer, T.; Mostert, D. J. J.; Mulder, C. P.; Nel, M. D. C. de W.; Niemand, F. J.; Otto, J. C.; Pelser, P. C.; Potgieter, J. E.; Rall, J. J.; Rall, J. W.; Sadie, N. C. van R.; Sauer, P. O.; Schlebusch, J. A.; Serfontein, J. J.; Smit, H. H.; Stander, A. H.; Steyn, J. H.; Treurnicht, N. F.; Uys, D. C. H.; van den Berg, G. P.; van den Berg, M. J.; van den Heever, D. J. G.; van der Ahee, H. H.; van der Merwe, J. A.; van der Spuy, J. P.; van der Walt, B. J.; van der Wath, J. G. H.; van Eeden, F. J.; van Niekerk, G. L. H.; van Nierop, P. J.; van Rensburg, M. C. G. J.; van Staden, J. W.; van Wyk, G. H.; van Wyk, H. J.; van Zyl, J. J. B.; Venter, M. J. de la R.; Venter, W. L. D. M.; Verwoerd, H. F.; Viljoen, M.; Visse, J. H.; von Moltke, J. von S.; Vorster, B. J.; Vosloo, A. H.; Waring, F. W.; Webster, A.

Tellers: D. J. Potgieter and P. S. van der Merwe.

NOES—44: Barnett, C.; Basson, J. A. L.; Basson, J. D. du P.; Bowker, T. B.; Cadman, R. M.; Connan, J. M.; Cronje, F. J. C.; de Kock, H. C.; Dodds, P. R.; Durrant, R. B.; Emdin, S.; Field, A. N.; Fisher, E. L.; Gay, L. C.; Gorshel, A.; Graaff, de V.; Henwood, B. H.; Hickman, T.; Higgerty, J. W.; le Roux, G. S. P.; Lewis, H.; Malan, E. G.; Mitchell, D. E.; Mitchell, M. L.; Moore, P. A.; Odell, H. G. O.; Oldfield, G. N.; Plewman, R. P.; Raw, W. V.; Ross, D. G.; Russell, J. H.; Steenkamp, L. S.; Steyn, S. J. M.; Streicher, D. M.; Suzman, H.; Swart, H. G.; Taurog, L. B.; Thompson, J. O. N.; Timoney, H. M.; Waterson. S. F.; Weiss, U. M.; Wood, L. F.

Tellers: H. J. Bronkhorst and A. Hopewell.

Motion accordingly agreed to.

Bill read a third time.

MARKETING AMENDMENT BILL

Second Order read: House to go into Committee on Marketing Amendment Bill.

House in Committee:

On Clause 4,

Capt. HENWOOD:

As we said during the second reading debate, we would move an amendment, which will be moved just now by my colleague, and I want to appeal to the hon. the Minister to accept that amendment. In Clause 4 the hon. the Minister is trying to cover omissions of the past, in other words, covering himself as Minister in relation to schemes that have been brought into being and have been found not to conform with the present Marketing Act, and to cover that omission, the hon. the Minister has come with this amendment. Now we have no objection to the hon. the Minister validating actions where a scheme has been successful and validating schemes of which we have knowledge and which are in operation, and which are there after going through certain Marketing Act procedure. But we do object to the hon. the Minister amending the original Act and to just validate omissions of the past, and that to be written into the Act for the future. We feel, Mr. Chairman, that if the Minister has to validate something, he should come with a special clause dealing with that only. He should not amend the original Act in such a way that this amendment will apply to the advertising as far as future schemes are concerned. It is absolutely essential in my opinion that there should be the widest publicizing of any scheme to be brought into being, because it affects practically all sections of the community as far as that particular product is concerned; a product which is to be dealt with by a scheme does not only affect the producer, but it affects the consumer and the distributor as well. It is only right, as was laid down in the original Marketing Act, that the widest publicity should be given to that scheme so that everybody affected, especially where it is in one particular area such as the fresh milk marketing scheme, should have full knowledge of what steps are to be taken under the scheme, because it affects his whole life. In terms of the existing Act the Minister must of course advertise that scheme in two local newspapers circulating in the area where that product is to be controlled. If the Minister will accept our amendment which will be moved shortly, he will be in a position where he will not be involved in heavy expenditure in advertising the scheme in the local newspaper. As the Minister himself said during the second reading, that involves heavy expenditure. But if the Minister advertises that scheme in the Gazette, we feel the very least he should do is to place a small notice in two local newspapers circulating in that area where the scheme is to be brought into being, drawing attention to the scheme as advertised in the Gazette and giving the date and the number of the Gazette concerned. That would cover him. As I have said before it is not only the consumer who is concerned but there are also the producer and the distributor. The livelihood of many people is affected. I want to point out to the Minister and hon. members opposite that the producer himself is also a very large consumer of other agricultural products in the production of his own particular agricultural product. It is absolutely essential in our opinion that all these people should be aware of the fact that a scheme is to be applied to their product or that distribution in their area is to be controlled so that representations can be made at the right time. Because if you want to introduce a scheme which will be successful it is essential that everybody who is affected by that scheme shall know the particulars of it and be given an opportunity of making representations if he so wishes. As I have said before, if the Minister wishes to validate schemes which are in existence at the moment, the very least he should do is to bring in a separate clause validating what has been done in the past and not amend the original Act which will apply to all future schemes.

*Mr. CONNAN:

Mr. Chairman, as we have already intimated, we would like to move an amendment to this clause. We have informed the hon. the Minister about it. We feel that it is no more than right that all interested parties will know beforehand that a scheme is being proposed and that it will be applied. The Minister said here yesterday that there was no idea of misleading people. He also said it seemed that there was a little suspicion. That is not the case. There is no suspicion on our part in regard to this matter, nor do we think that the intention is to mislead anybody. But it is no more than right that people who are interested in such a scheme should have the fullest opportunity of knowing that such a scheme will be forthcoming, because otherwise there might be suspicion in their minds, and that is what we want to prevent. There are perhaps people who have objections, and they must have the fullest opportunity to voice their objections. Therefore I want to move the following amendment, of which we have informed the Minister—

To omit paragraph (a) of sub-section (1) and to substitute the following new paragraph:

  1. (a) by the substitution in paragraph (b) of sub-section (3) for the words “cause the particulars concerning such scheme to be published by notice in the Gazette and in one or more newspapers circulating in the area in which the scheme is to apply” of the words “if he deems it necessary, cause to be published in the Gazette a notice containing the particulars concerning such scheme, and in one or more newspapers circulating in the area in which the scheme is to apply a statement indicating that the particulars of such scheme have been published in the Gazette”; and.

I hope the Minister will accept this amendment, because we would also like to make this legislation as effective as possible.

*The MINISTER OF AGRICULTURAL ECONOMICS AND MARKETING:

I am sorry but I cannot accept this amendment and I shall tell hon. members why not. If hon. members read the clause they will see that in the first place it is permissive for the Minister to publish a scheme in the Government Gazette. He is not compelled to publish it. He can institute a scheme without publishing it in the Government Gazette. But because we want to give notice to the persons concerned, to those who are connected with the industry covered by the scheme, and because we want to publish that notice to the effect that a scheme is being instituted as widely as possible, the Minister makes use of the right he has to publish the scheme in the Government Gazette. But as the law stands at the moment it means that if the Minister makes use of that right, he cannot publish only in the Government Gazette but must publish also in one or more newspapers circulating in the area concerned. If a Minister were to do what hon. members are afraid of, namely if he does not want to give proper notice to the producer and the consumer who are concerned with the product which is being controlled, he simply need not publish the scheme in the Government Gazette. He can then just institute the scheme, because in terms of the Act he has the power to do so. If we make it difficult for him to publish the scheme in the Government Gazette, the logical consequence will be that he will make use of his other power simply to institute the scheme. Then these people will know nothing about it. The hon. member opposite mentioned the example of the fresh milk scheme which was instituted in various areas, in the Pretoria-Johannesburg complex, Bloemfontein and Cape Town. In other words, in each of those areas the whole scheme must be published in at least one newspaper, which will cost a tremendous amount of money. Never has any scheme been instituted in regard to which there was publication in other newspapers apart from the Government Gazette. All the schemes established under the Marketing Act have always been published in the Government Gazette only. If I were now to accept the hon. member’s amendment, it means that any scheme which in the past was published only in the Government Gazette, but in connection with which the attention of the public was not also attracted to the local newspapers—as hon. members now suggest in their amendment—can now be tested in court. I am not referring only to the fresh milk scheme now, but any scheme established in the past can now be tested in court, and then the court will say that the power which the Minister is now taking was not used at that time, that the scheme was in fact published in the Government Gazette but that notice of it was never given in the local newspapers. That is another reason why I cannot accept the amendment, because it will mean that all the schemes of the past will be able to be tested in court again on the same grounds.

Mr. Chairman, surely the intention is, when a scheme is established, to publicize the contents of that scheme as widely as possible; and when the scheme is published in the Government Gazette, the Minister does so particularly in order to notify the public about the scheme. The object is to spread that notice as widely as possible, and therefore a statement is usually made in the Press circulating in that area for which the scheme is instituted. It is usually stated in the Press that such-and-such a scheme was accepted by the Minister and that it has been published in the Government Gazette for everybody to read. Before the scheme is instituted it is a preliminary notice, because the Minister must convince himself that the majority of the producers of that product are in favour of the scheme. The Minister must do so before he can finally establish the scheme. I cannot see why hon. members have these objections. As I have said, the primary consideration is that the Minister need not publish it in the Government Gazette at all. For the reasons I have given I cannot accept this amendment. I want to ask hon. members not to make the position more difficult. If I accept the amendment, any person may again go to court to have any scheme established in the past tested, and where this section is made retrospective the plea will be that this section was not complied with. I hope hon. members follow this argument and that they will not insist on the amendment.

*Mr. SWART:

I want to support the amendment of the hon. member for Gardens (Mr. Connan). I want to agree with the Minister, as I did yesterday also, that it is permissive for him to publish a scheme in the Government Gazette. The words in the principal Act are permissive. The Minister need not do so if he does not want to. But where I do not agree with the Minister, with respect, is the statement that when a scheme has been published in the Government Gazette, the widest possible publicity has been given to it.

*The MINISTER OF AGRICULTURAL ECONOMICS AND MARKETING:

I did not say that.

*Mr. SWART:

The Minister said that the object is to publicize the scheme as widely as possible. I take it the Minister means by that if a scheme is published in the Government Gazette it is publicized as widely as possible I do not agree with that, because the Government Gazette is read by very few members of the ordinary public. It is only people interested in certain aspects of our economic and other national activities who read the Government Gazette. Therefore I say that the fact that it is published in the Government Gazette does not necessarily mean that it is widely publicized to those affected by the scheme. Now the Minister says that the amendment provides him with a loophole. If in terms of this amendment we want to compel him, when he publishes a scheme in the Government Gazette, also to make a statement in the newspapers circulating locally in an area where the scheme will be applied, to draw attention to the fact that the scheme has been fully published in the Government Gazette, then we give him a loophole for simply not publishing the scheme in the Government Gazette. I did not expect such a statement from a Minister whom I know is so well disposed to the farmers—that he will now look for loopholes when he thinks it is necessary for the public to know certain things; and I am also sure that the Minister and his Department, when they consider that it is necessary to publish the scheme in the Government Gazette, will never think of looking for a loophole so as not to do it, simply because he must publish a statement in a local paper. It is not the complete scheme which is published in the local paper. It is just a short statement drawing attention to the fact that the complete scheme has been published in the Government Gazette of a certain date. It will take one of the responsible officials in his Department just two or five minutes to write out such a statement and to ring through to the Press to ask that it be published. I can therefore not see why the Minister insists on refusing this amendment, simply on the basis of the argument he mentioned that we are giving him a loophole for not publishing in the Government Gazette. I cannot accept that, because I think this Minister stands on a higher moral basis than that when he has to serve the best interests of the farmers and of the public. He will not seek such loopholes.

Sir, I insist that if the Minister and his Department consider a scheme so important that he thinks the public and the parties concerned are so interested in the scheme that it should be publicized as widely as possible before the scheme is promulgated—then I think that if he thinks it is so essential that it should be published in the Government Gazette in the general interest, it is equally essential that the persons particularly concerned in such a scheme should be notified simply by way of advertisement in the local newspaper that the details of such a scheme have appeared in the Government Gazette. Then the people who consider that they are affected by the scheme can buy the Government Gazette and read the complete scheme. I think it is a duty resting fairly on the Minister and his Department to give that notice to the people concerned.

I see the other point of the Minister—I am not a lawyer—that if this amendment of ours is accepted, and seeing that provision is made in Clause 4 (2) that the date of the coming into operation of that clause will be considered to be the date on which the principal Act came into operation, the position of the Minister will be made difficult. I think I can realize the Minister’s difficulty. But I think the Minister can seek another way out if he accepts our amendment. He can insert a clause saying that schemes already promulgated are legal, and then leave the door open for the future, so that schemes promulgated in future will be covered by the provisions of this clause. I do not think there is anything to prevent the Minister from inserting a sub-section to legalize schemes already promulgated in the past, irrespective of the fact that they were not published in local newspapers. I therefore cannot understand this objection. Therefore I think that, all things considered, this amendment of ours is reasonable. We have tried to get the Minister out of the difficulty of having to spend thousands of rand to publish complete schemes in perhaps eight or ten newspapers, as in the case mentioned, the fresh milk scheme, where it would have had to be done because it is applicable in the four big centres in the country. We have tried to save the Minister from that difficulty by simply asking that an advertisement be published, instead of the complete scheme, which will then notify the people concerned through the local newspaper. I think that is a reasonable request.

*The MINISTER OF AGRICULTURAL ECONOMICS AND MARKETING:

I think I could perhaps shorten the discussions. The position is that two powers are being given here to the Minister. He can do one of two things. He can introduce a scheme without advertising it or he can advertise it in the Government Gazette. Why should the Minister advertise it in the Government Gazette? The only reason is to bring it to the notice of as many people as possible. Having taken the trouble of bringing it to the notice of people by means of the Government Gazette, he will also make use of all the other means at his disposal to bring the scheme to the notice of the people concerned. That is logical. Why does the Minister otherwise use the power which he has? If he exercises that power it is only logical that he does so only to bring it to the notice of as many people as possible. If he has other means at his disposal whereby he can bring a scheme to the notice of the public, except the Government Gazette, he will naturally use them. It is logical that he will do so. He will make a statement to the daily Press that such and such a scheme is being advertised. Any newspaper in South Africa to whom you say that a new scheme is to be introduced, is sufficiently interested, if you ask them to send one of their reporters and give him a broad outline of the scheme to give full publicity to it. It is important news to such a newspaper. In other words, that scheme is advertised as widely as possibly. Even the people concerned with the production of the product in respect of which the scheme is being advertised, are consulted. They are notified and the scheme is considered with them. Not I but other Ministers have in the past introduced 17 schemes under the Marketing Act. The majority of them were advertised in the Government Gazette, but not one in any local newspaper. Nor was notice given in any local newspaper in the way the hon. member has suggested should be done. In respect of no scheme introduced in the past has there ever been any complaint that it had not been advertised sufficiently widely. Everybody who was concerned with it was fully acquainted with the nature of the scheme the day it was introduced. All we are doing in this Bill is to legalize a practice which has existed in the past and which has always been accepted in the past as being legal, namely that the Minister may advertise in the Government Gazette and in one or more newspapers circulating in the area concerned. Our legal advisers’ interpretation in the past has been that it was legal to do it that way, namely that the Minister “may” advertise in the Government Gazette or in other newspapers as well. The judgment of the court in this connection was that if the Minister exercised the power which this legislation gave him and advertised in the Government Gazette he must also advertise in another newspaper. It has never been interpreted that way in the past. Someone went to court in respect of the milk scheme and obtained judgment in his favour on that technical point. If I were to accept the amendment moved by hon. members, without taking the other complicated steps as suggested by the hon. member for Florida (Mr. Swart), it would mean that those same people could again go to court and adopt the attitude that as far as the 16 or 17 schemes introduced in the past were concerned, the Minister had not complied with the provisions of the Act, because this clause will be of retrospective effect. They will then be able to obtain an interdict in a court of law in respect of each of those schemes on the same grounds. I hope hon. members follow that. We want to prevent that. I want to ask the hon. member this: Why will the Minister advertise in the Government Gazette? There is only one reason, and that is to make the scheme known and if that area has a local newspaper, why should he not make use of that newspaper’s anxiety to obtain news to make the scheme known? Surely that is clear. For those reasons I think hon. members are seeing dangers in this amending clause which do not exist at all and which never existed in the past, because in the past it was not interpreted the way in which it is to-day. I hope hon. members will accept it as such and withdraw their amendment.

Mr. CONNAN:

The hon. the Minister has just told us that there are two ways of dealing with this matter. One by not advertising at all and the other by advertising it in the Government Gazette. There is no question of even discussing the first one because the Minister will always publish in the Gazette. I do not think the Minister will ever try to introduce any scheme without advertising it in the Gazette. I do not want to go into all the details. I just want to make this point. We fully realize the Minister’s difficulty with regard to the amendment we have moved, but we do want to impress upon him that we feel very strongly about the fact that we think that the public should be, as the Minister himself has said, acquainted with the fact that such a scheme is being advertised and that it will be brought into operation. That fact should be brought to their notice. A small amendment can very easily put that position right. I therefore wish to move the following amendment—

To add the following new paragraph at the end of sub-section (1):
(c) the provisions of paragraph (a) shall not affect the validity or otherwise of any scheme or of any proceedings in terms of that paragraph.

I think we are being perfectly reasonable in moving this amendment and I hope the Minister will accept it.

Mr. BOWKER:

We fully realize that the Minister seeks to validate all schemes which were not advertised in local newspapers. The hon. the Minister must understand that we wish to assist him in that regard. This side of the House is supporting him in that. But we do feel that under the Marketing Act we should ensure that the widest possible publicity is given to any scheme. I appeal to the Minister to accept this amendment. This amendment ensures that publicity. We realize that the earlier amendment may hamper the Minister in trying to validate existing schemes. But the amendment just moved by the hon. member for Gardens (Mr. Connan) provides that existing schemes will not be affected by the first amendment. The Marketing Act does provide for the regulation of the production and sale of agricultural products in the interests of both consumer and producer. We have the position to-day that the consumers consider that their interests are not being safeguarded. The Bill provides for a consumers’ council. But there is very little activity in respect of the establishment of such a consumers’ council. The very fact that provision is made for the establishment of a consumers’ council indicates that the widest possible publicity should be given to any scheme. Any scheme must be brought to the knowledge of the producer and any scheme which is designed to protect the interests of the producer and the consumer should be brought to the notice of the consumer. If no indication is given in the local newspaper that a scheme is about to come into operation, the consumers will know very little about it. What we ask the Minister to do is this. Validate your amending Acts that have been passed that are in danger of being questioned in the courts, but add a provision to ensure that in future some indication will be given in the local papers of a proposed scheme. It is as simple as that. We have no doubt the Minister could make provision for that. If he feels that this amendment was sprung on him too suddenly, perhaps he will indicate that he will consider it later in the Other Place. Even that would satisfy us. We want to help the Minister, but we want to retain the confidence and support of the public in general, to assist the farmer to provide food at as economical a price as possible.

*Mr. G. F. H. BEKKER:

I really cannot understand our friends opposite. The farmers have asked that it should be possible to proclaim a scheme under the Marketing Act. The Minister is trying to close loopholes. He has said that there have been court cases. He is only asking hon. members to protect the farmers and to word this section in such a way that the farmers will be protected. But it seems to me that our friends opposite are so concerned about the consumer and so little concerned about the farmer that they want us to leave the back door open so that the commercial people may enter and sabotage the Marketing Act. I hope the Minister will be adamant on this point.

Mr. GAY:

May I put the point of view of the consumers. I believe that the producer is well able to keep up his own end, but I want to touch on this point as it affects the consumer. What we ask for is nothing new; no new principle is involved. It is part of the principle of the Marketing Act to provide for orderly marketing and to safeguard the interests of both the producer and the consumer. The hon. member for Cradock said this side is not interested in protecting the producer, but unless he can satisfy the consumer the producers will not have a market. All we ask here is that the consumer will have notice as to what is taking place in regard to the marketing of any basic article of his food, such as milk and dairy produce. The producer sets out to produce the best article he can and to obtain the most satisfactory marketing conditions for it, but in marketing there are two factors, the welfare of both producer and consumer. There is no new principle involved here. Local government encountered the very same problem. The Minister raised the problem of expense in the multiplicity of publications in the papers. In the big urban areas the newspapers are the only means of communicating between the producer and the consumer and of keeping the consumer acquainted with what is going on. The average member of the public has no knowledge of what is published in the Government Gazette. All we ask is that there will be a notice in the paper to draw his attention to the fact that on such a day a notice which affects his foód will be published in the Gazette. Then if the consumer is interested he can read it. If not, he cannot squeal afterwards. That is how the local authorities work. Their ordinances and their proclamations have to be published in the Government Gazette. Attention is drawn to them by notices in the local papers. I hold no brief for any attempt on the part of the producers, because it is a little more inconvenient or costly, to try to evade that point of connection between themselves and the people they have to depend on for their business. They could not exist without the consumers. I appeal to the Minister to give this amendment further consideration. There may be some legal flaw that unless he follows this course in every case, someone will go to court. That should not be difficult to deal with. Costs do not enter into it because a small advertisement in one or two local papers does not cost much, and even if it is a general publication throughout the country, is it not better to incur that cost than to start off with something which is detrimental to orderly marketing? If the question of a court case comes into it, surely it is not beyond the ability of the Minister to insert a short clause which exonerates him. I believe there is a fundamental principle which we will undermine if this amendment is not adopted. It is something which has been accepted as part of the Marketing Act and as an every-day feature in public life. I see no reason why the farming community should expect to be treated in this regard any more leniently than any other member of the public. It is a matter which affects the well-being of everyone in the area. Surely it is not too much to ask that the farmers should take these necessary steps to keep in touch with the consumers. An example was given only a few months ago when the new coupon system for the sale of milk came into operation, a system under which some of the lower-paid people who are only paid weekly now have to buy their coupons and pay a week or a month in advance for milk they have not yet received. It is a good scheme, but my point is that the public should have been informed about it in advance. The ordinary newspapers are the channel for making these communications.

*Mr. MARTINS:

In order to see this matter in its right perspective it is necessary to refer to Section 19 of the Financial Adjustments Act of 1932 which provides that where it is required under an Act that something should be advertised in the Government Gazette and in the newspapers, the Minister concerned can instruct that it be advertised in the Government Gazette only and that would be sufficient. That has always been the position in respect of all notices. We should also bear in mind that it has only been as a result of a court decision that the Minister must also in this case advertise it in an ordinary newspaper. But we should not lose sight of the background, namely, that as the Marketing Act reads at the moment, a position which has been accepted all these years, it has always been in the Minister’s discretion whether or not he even advertised in the Government Gazette. He has never been obliged by law to advertise in the Government Gazette.

*Mr. STREICHER:

On a point of order, is the hon. member for Cradock entitled to say that the hon. member for Durban (North) is committing sabotage?

*Mr. G. F. H. BEKKER:

I said he wanted to sabotage it.

*The CHAIRMAN:

The hon. member may continue.

*Mr. MARTINS:

We find that the court recently ruled that the relevant provision of Act 35 of 1932 does not cover what is envisaged under the Marketing Act. The court has ruled that once the Minister has decided to advertise he must also advertise in the local newspapers. But the courts have never found that the Minister is obliged to advertise, not even in the Government Gazette. I want to know this that if the position arises where the Minister regards it as necessary to advertise in the Government Gazette for the information of the producer and the consumer, why should we compel him to advertise in a local newspaper as well because the legal position is that if he advertises in a local newspaper he must place the entire advertisement as it appears in the Government Gazette in the local newspaper. That is what this amendment entails. But I go further. I come to the second amendment moved by the hon. member for Gardens. If you analyse the amendment of the hon. member for Gardens, Sir, it means that we will be laying down by law that the Minister is compelled to provide the newspapers with news and I cannot see why we should lay that down by law, because the Press will publish anything which is advertised in the Government Gazette which they regard as being of news value and which is in the interests of the producer and the consumer. But I want to go further. If we lay down by law that the Minister is compelled to advertise a news item in the Press, as suggested by the hon. member for Gardens, must he do so in all the newspapers of South Africa? Because he cannot discriminate. If he places it in the Cape Times he must also place it in the Natal Witness and all the other newspapers, because it is an item of news to people everywhere and they do not all read the same newspaper.

I am even taking it further. Surely hon. members know that there are control boards under the Marketing Act and that the producer and the consumer are represented on those boards. It is incorrect to maintain, therefore, that the consumer will not know what is going on in respect of a controlled product and the marketing thereof. The consumer has his representative there and I cannot see why hon. members have moved this amendment. I want to ask the Minister not to consider it, because if he accepts it will only mean that the producer will have to pay for it; where we are already faced with over-production and where even hon. members opposite are complaining about the decreasing tendency in the prices which the farmer receives they should assist us so that we do not incur unnecessary expenditure. That is why I wish to ask the Minister not to accept the amendment, because it will only mean an increase in the production costs of the producer.

Capt. HENWOOD:

I think it is most unfortunate that the hon. member for Cradock should have tried to introduce politics into the matter.

Mr. G. F. H. BEKKER:

What politics?

Capt. HENWOOD:

By saying that our side are not interested in the producer. Everyone in this House knows that it is the United Party which passed the Marketing Act and over the years on both sides of the House we have co-operated to make this a workable Act for the benefit of everyone concerned. In relation to the amendment we moved, we only had the second reading late yesterday afternoon. When we drew up this amendment this morning we sent a copy to the Minister for his information. We want a workable Marketing Act and we want the schemes under that Act to be successful. For that reason we suggest in this amendment that the Minister should validate any omissions of the past in a separate clause or a separate sub-section to Clause 4. We said we would give him our support if he did that. What more can we do to show that we are dealing with thise Bill objectively for the benefit of everyone?

In reply to the hon. member for Wakkerstroom (Mr. Martins), our amendment does not say that the Minister, having published a scheme in the Gazette, should then have to advertise in all the newspapers. If he had only listened to the amendment, he would have heard that we kept to the wording of the present Act, and that instead of publishing the whole scheme in two newspapers circulating in the area, the Minister should just put a small notice in two papers.

Mr. MARTINS:

May I put a question? If you have a scheme for the whole of the Republic and that scheme affects people in one area who receive the paper published there, do you want it in all the papers?

Capt. HENWOOD:

We say in our amendment only two papers circulating in the area should have a small advertisement and not the whole scheme. [Interjections.] We are trying to deal with this matter objectively and I object to party politics being dragged into the matter. Over the years we have applied schemes successfully and everybody who is affected is entitled to know about the scheme. The hon. member for Florida (Mr. Swart) asked the Minister to consider this angle, that if it is an important scheme dealing with the product consumed by very many people, we feel sure that he will publish it in the Gazette, but how many people see the Gazette? Even we in this House, with the number of Gazettes published to-day turned out like sausages, find it impossible to read them all. But if there is a small advertisement in the Press it will come to the notice of everyone. Surely that is reasonable. We are trying to help the Minister to see that the schemes are accepted by the bulk of the people interested.

Mr. BOWKER:

On a point of explanation, the last speaker was not informed that the amendment did not reach the Minister’s office this morning, through an error.

*The MINISTER OF AGRICULTURAL ECONOMICS AND MARKETING:

I really cannot understand why hon. members are so concerned about this advertisement which they wish to publish in the newspapers. That notice will in any event be given in the newspapers but we simply do not wish to be compelled by law to do so because if you are compelled to give notice the schemes of the past will be illegal. Hon. members now want another clause to declare those schemes to be legal, but that is unnecessary. Hon. members have said that if you give notice in the Government Gazette, you must do so in the newspapers, and that this was an accepted principle. But, it is not an accepted principle. This Parliament adopted a law, Section 19 of the Financial Relations Act of 1932, which provides that where a law requires publication in the Government Gazette and in the newspapers, the Minister concerned may issue an instruction that publication should only take place in the Government Gazette and that this will be sufficient. We adopted that law and it is still on the Statute Book and no one has objected to it yet. Now they say if I do not accept this amendment a terrible thing will happen. That is directly in conflict with what this House decided.

The hon. member for Simonstown (Mr. Gay) says that if you do not publish the notice in local newspapers, the consumers will not know about the scheme. However, the Marketing Act provides that any scheme which is investigated and recommended by the Marketing Council must also be referred to the consumers’ committee for their comments. You have to refer it to them

Mr. GAY:

Do you keep that committee in cold storage?

*The MINISTER OF AGRICULTURAL ECONOMICS AND MARKETING:

No, it meets regularly four times a year and it has its representatives on all the boards. However, the most important consideration of all is why notice must be given as widely as possible. I do not think any hon. member believes that a Minister would institute a scheme that the majority of producers know nothing about. I want to see the Minister who would dare to do this because the repercussions would be so great that he would not dare to do it. I cannot see why hon. members should be afraid that the Minister will institute a scheme with which the public are not acquainted. When a scheme is established, it is published as widely as possible. But there is this further point. It may be that a scheme was published in the past and that amendments are made to it at some future date. You then have to publish those amendments in the Government Gazette. This means that once again you have to publish the entire scheme, with all the amendments which you effect, in the local newspapers, and that proposal will be on the recommendation of the Council on which all these interests are represented. I am sorry but I cannot accept this amendment.

*Mr. SWART:

In spite of what the hon. the Minister said—and he made out a reasonably good case—I want to say that I am not used to the type of argument of the hon member for Wakkerstroom (Mr. Martins). In spite of his predilection for sometimes yielding to the temptation to talk politics. I am not used to his advancing that type of argument. He usually puts up a reasonably good argument if he has studied the matter. The hon. member says that if the amendment of the hon. member for Gardens is accepted, it will only mean that the farmers will have to spend enormous sums of money on the publication of advertisements. The hon. member knows that is not so because the person who would pay is the hon. the Minister or his Department, and it would only be a small advertisement. The argument that the farmers would have to pay a great deal of money is one which is not worthy of that hon. member —that a small advertisement in two newspapers would cost the farmers a great deal of money.

*Mr. MARTINS:

But an advertisement in only one or two newspapers would not be worth the trouble.

*Mr. SWART:

The further argument is that there are producers and consumers represented on the boards but to say that for this reason it is not necessary to publish the scheme does not hold water because this amendment of the Marketing Act refers particularly to schemes which are not yet functioning. Except in the case which the hon. the Minister mentioned, most of them have not yet come into operation and in that case you will have no boards which represent these various bodies.

*The MINISTER OF AGRICULTURAL ECONOMICS AND MARKETING:

May I explain the position? It means that notice has to be given in the Press of every amendment which is made to a scheme, in terms of this amendment, and which is published in the Government Gazette.

*Mr. SWART:

I think that this is a responsibility and a duty which the Government of the country has and which a department has in regard to the people who are affected. I think that it is a duty and a responsibility which must be carried out.

The hon. member for Wakkerstroom used another argument which was just as petty and that was that the hon. the Minister must be held responsible for giving news value to the Press. To link up the idea of news value with this amendment which we have moved is completely wrong. I am not interested in news value which has to be given to the Press in this case, or whether it is news value or not. I am only interested in the fact that the people who are going to fall under a scheme must have knowledge of it. If the hon. the Minister considers it so important that it should be published in the Government Gazette, then the public should be notified by a notice in the Press. I am not interested in the slightest in news value for the Press and I think that argument of the hon. member for Wakkerstroom does not hold water.

I also want to say that I think that if this amendment of ours had originally been included in the Marketing Act in 1937, instead of the section as it now stands, the hon. the Minister would not have had the difficulty at all that he now has to make certain clauses retrospective, because the most important reason why it is not always published in the local Press is the question of expense, as the hon. the Minister himself said. We are now trying to solve this problem of expense for him by means of this amendment, and this would also have happened in the past if the section in the Marketing Act had originally been framed in this way. Therefore I am even more convinced that this is an improvement even on the original terms of the Marketing Act as passed in 1937.

Question put: That paragraph (a) of sub-section (1), proposed to be omitted, stand part of the clause.

Upon which the Committee divided:

AYES—85: Badenhorst, F. H.; Bekker, G. F. H.; Bekker, H. T. van G.; Bekker, M. J. H.; Bezuidenhout, G. P. C.; Bootha, L. J. C.; Botha, H. J.; Botha, M. C.; Botha, P. W.; Botha, S. P.; Cloete, J. H.; Coertze, L. I.; Coetzee, P. J.; Cruywagen, W. A.; de Villiers, J. D.; Diederichs, N.; Dönges, T. E.; Faurie, W. H.; Fouché, J. J. (Sr.); Fouché, J. J. (Jr.); Frank, S.; Greyling, J. C.; Grobler, M. S. F.; Haak, J. F. W.; Hertzog, A.; Heystek, J.; Hiemstra, E. C. A.; Jonker, A. H.; Knobel, G. J.; Kotze, G. P.; Kotzé, S. F.; le Roux, P. M. K.; Loots, J. J.; Luttig, H. G.; Malan, W. C.; Marais, J. A.; Maree, G. de K.; Maree, W. A.; Martins, H. E.; Meyer, T.; Mostert, D. J. J.; Mulder, C. P.; Nel, M. D. C. de W; Niemand, F. J.; Otto, J. C.; Pelser, P. C.; Potgieter, J. E.; Rall, J. J.; Rall, J. W.; Sadie, N. C. van R.; Sauer, P. O.; Schlebusch, J. A.; Serfontein, J. J.; Smit, H. H.; Stander, A. H.; Steyn, J. H.; Treurnicht, N. F.; Uys, D. C. H.; van den Berg, G. P.; van den Berg, M. J.; van den Heever, D. J. G.; van der Ahee, H. H.; van der Merwe, J. A.; van der Spuy, J. P.; van der Walt, B. J.; van der Wath, J. G. H.; van Eeden, F. J.; van Niekerk, G. L. H.; van Nierop, P. J.; van Rensburg, M. C. G. J.; van Staden, J. W.; van Wyk, G. H.; van Wyk, H. J.; van Zyl, J. J. B.; Venter, M. J. de la R.; Venter, W. L. D. M.; Verwoerd, H. F.; Viljoen, M.; Visse, J. H.; von Moltke, J. von S.; Vosloo, A. H.; Waring, F. W.; Webster, A.

Tellers: D. J. Potgieter and P. S. van der Merwe.

NOES—39: Barnett, C.; Basson, J. A. L.; Bowker, T. B.; Cadman, R. M.; Connan, J. M.; Cronje, F. J. C.; de Kock, H. C.; Dodds, P. R.; Durrant, R. B.; Emdin, S.; Field, A. N.; Fisher, E. L.; Gay, L. C.; Gorshel, A.; Graaff, de V.; Henwood, B. H.; Hickman, T.; Higgerty, J. W.; Lewis, H.; Malan, E. G.; Mitchell, D. E.; Mitchell, M. L.; Moore, P. A.; Odell, H. G. O.; Oldfield, G. N.; Raw, W. V.; Ross, D. G.; Russell, J. H.; Steyn, S. J. M.; Streicher, D. M.; Swart, H. G.; Taurog, L. B.; Thompson, J. O. N.; Timoney, H. M.; Waterson, S. F.; Weiss, U. M.; Wood, L. F.

Tellers: H. J. Bronkhorst and A. Hopewell.

Question accordingly affirmed and the amendments negatived.

Clause, as printed, put and agreed to.

On Clause 6,

The MINISTER OF AGRICULTURAL ECONOMICS AND MARKETING:

I move—

To add the following new paragraph at the end of sub-section (1):
(c) by the insertion at the commencement of paragraph (c) of sub-section (2)bis of the words “where the board considers it equitable to do so”, and by the deletion in sub-paragraph (i) of paragraph (c) of sub-section (2)bis of the words “and provided such difference is not due to circumstances which, in the opinion of the board, were beyond the control of such producer ”.

Last year when the Marketing Act was amended the Opposition moved an amendment which I now propose to delete. I accepted that amendment last year, but it has now transpired that in the case of certain boards, particularly where the Citrus Board has to deal with exports and where producers have to give notice in advance of the quantity of citrus that they are going to deliver by a certain date, it is difficult for them to penalize those persons who fail to deliver the quantity that they undertook to deliver. The boards have to make provision for shipping, and where producers fail to deliver what they undertook to deliver, the pool concerned is involved in losses, and it is for that reason that we propose to delete that portion and to substitute for it the amendment which I have just moved.

*Mr. J. A. L. BASSON:

I should just like to hear from the Minister whether there were actual cases last year where the Citrus Board had booked shipping space and where the Board had to pay for space that was not taken up.

*The MINISTER OF AGRICULTURAL ECONOMICS AND MARKETING:

There were such cases, and those producers were penalized, but as the Act now reads those people would be able to go to court in every instance and say that they failed to deliver because of circumstances beyond their control. We are now inserting the words, “where the board considers it reasonable to do so it may with the approval of the Minister” claim the amount involved from the person concerned. There were such cases, but nobody took the matter to court. If the matter had been taken to court the boards would have had to prove that the person concerned was not prevented by circumstances beyond his control from delivering the quantity which he had undertaken to deliver.

*Mr. J. A. L. BASSON:

The hon. the Minister has not replied to my question fully. What I meant was this: Were there actually such cases during the last season, because we passed the Bill practically towards the end of the session? Were such cases reported to the Minister during the last season?

*The MINISTER OF AGRICULTURAL ECONOMICS AND MARKETING:

No such cases were reported to me, but the Citrus Board as such was faced with this difficulty, and this amendment is being proposed at the insistence of the Citrus Board, and it is being done particularly on the recommendation of one of the hon. members of the Other Place.

*Mr. J. A. L. BASSON:

But last year when the Minister accepted the amendment proposed by us, he gave us to understand that this request had come mainly from the banana-growers, and now the Minister says that the amendment is being proposed at the insistence of the Citrus Board. Who really asked for it; was it the Citrus Board or the Banana Board?

Amendment put and agreed to.

Clause, as amended, put and agreed to.

Remaining clauses and Title of the Bill put and agreed to.

House Resumed:

Bill reported with amendments.

UNEMPLOYMENT INSURANCE AMENDMENT BILL

Third Order read: Second reading,—Unemployment Insurance Amendment Bill.

The MINISTER OF LABOUR:

I move—

That the Bill be now read a second time.

Before I come to the saliant principles of the Bill, I think I should make a few general observations. As hon. members know, last year the Select Committee on Public Accounts drew the attention of Parliament to the worsening financial position of the Unemployment Insurance Fund, and it recommended that special attention should be given to the matter. It will be recalled also that the strong financial position of the Fund led to the decision being taken in 1957 that the rates of contributions and the benefits should be increased.

An HON. MEMBER:

The contributions were decreased.

The MINISTER OF LABOUR:

Yes, the contributions were to be decreased and the benefits were to be increased.

Mr. S. J. M. STEYN:

There is a slight difference.

The MINISTER OF LABOUR:

That is what I meant. At that time it was hoped that this action would result in the Fund coming out more or less square, as it was not considered necessary to keep on building up surpluses. Unfortunately this hope has not been realized. On the contrary, there has been a small but a growing reduction in the capital assets of the Fund, and although the Fund is more than able to meet its obligations in the foreseeable future, I agree with the Public Accounts Select Committee that the position must be reviewed. Expenditure on benefits has increased from approximately R5,000,000 in 1956 to over R12,000,000 in 1960, and the estimated amount for 1961 is R15,000,000. Income has remained stationary during that period, with the result that the Fund has shown a deficit from 1959 onwards. This deficit has grown from R3,000,000 in 1959 to an estimated R6,000,000 in 1961. These deficits have, of course, been financed by drawing on the Fund’s investments, which were consequently reduced by R3,000,000 in 1959, by R3,500,000 in 1960 and by over R5,000,000 in 1961. The money invested by the Fund with the Public Debt Commissioners was still quite imposing, because even at the end of 1961 it still exceeded R120,000,000.

Mr. S. J. M. STEYN:

Can you give us the percentage of unemployed at the present moment?

The MINISTER OF LABOUR:

I will tell the hon. member that later; I have the figures here. At the end of 1961 the Fund exceeded R120,000,000. Obviously with this amount invested the Fund, as hon. members will appreciate, is still in a very strong position, but I think hon. members will agree that this state of affairs cannot be allowed to continue indefinitely. The Unemployment Insurance Board has gone into the matter very carefully and has unanimously recommended certain important amendments to the Unemployment Insurance Act.

The proposals of the Board fall into two categories. Firstly, they propose increased contributions by employers, by contributors and by the State. These recommendations are being considered but it is not practicable to introduce legislation on this subject during this Session. The second is a proposal to amend the conditions relating to the payment of benefits so as to bring the use of the Fund more into line with its primary object, namely to tie a contributor over during a period of temporary unemployment. Those are the amendments in regard to the second category.

Before I proceed to discuss the detailed amendments, may I put before hon. members as briefly as I can the main causes of the deterioration of the financial position of the Fund, as I see them. For this purpose I propose once more to refer to the difference between the years 1956 and 1961. During this period payments in respect of benefits rose, as I have said, roughly from R5,000,000 to R15,000,000, an increase of 200 per cent. The main causes of this increase may, I think, be summarized as follows: (1) The unemployment figure as at 31 December 1956 was 12,631; the figure as at 31 December 1961 was 31,169.

Mr. DURRANT:

We heard a different story during the election campaign.

The MINISTER OF LABOUR:

The second reason is that in 1957 the scale of benefits was substantially increased. The rates of increase vary in the different groups from 14 per cent to 30 per cent—those were the benefits. Thirdly, the maximum remuneration for participation in the Fund was raised in 1957 from R1,500 to R2,500; that is to say, the ceiling of the salary of persons who could participate in the Fund was raised from R1,500 to R2,500. I want to point out that this brought into the Fund a number of additional contributors falling within the scope of the Act. These factors which I have mentioned account very largely for the increase in the amount paid in benefits.

With those facts in the background I would like to deal with the main provisions of the Bill as shortly as possible. If hon. members will refer to Clause 1 they will find that in terms of Section 40 (1) (g) of the Act which was passed in 1946, benefits may be withheld for a period of six weeks where a contributor loses his employment through his own misconduct or where he voluntarily leaves his employment without just cause. There has been some doubt as to whether a contributor is required to register for employment during such period, and it is now proposed that an unemployed contributor should be required to register during the whole period of the penalty if he is to qualify for benefits from the date such period expires, and that the claims officer should be given power to extend the penalty period if the contributor fails to register. The proposed amendment to Section 38 now provides for this.

The next clause to which I want to refer is Clause 2 (1) (a), and here I want to point out to hon. members that there is an error in the explanatory memorandum. If hon. members will refer to the explanatory memorandum they will see that the explanation of Clause 2 which amends Section 39 of the principal Act, is this—

This amendment provides that the contributor shall be entitled to one week’s benefits for each completed four weeks’ employment between 1 January 1960 and the date of the commencement of the Unemployment Insurance Amendment Bill.

The date “1960” should be “1950”. I am now dealing with Clause 2 (a). In terms of Section 39 (2)bis the benefits which may be paid to a contributor shall not exceed one week’s benefits for each completed four weeks as a contributor. This ratio was introduced into the Act in 1950. Previously, under the Unemployment Benefit Act of 1937, the ratio had been 1:6, and it is now proposed to revert back to the ratio of 1:6. Hon. members will notice that this provision will only come into force after the Bill has been placed on the Statute Book, in other words it will not be retrospective. Sir, it is imperative that benefits should as far as possible be only paid to genuine work-seekers. Most of the regular workers have large credits and the ratio of 1:6 would not really affect them. Those who would be affected would be contributors who are continually losing their employment, and also married women who periodically return to the labour market.

Clause 2 (b) is the next sub-section I want to deal with. The present Act provides that the number of weeks for which benefits are payable is not to exceed the number of weeks standing to a contributor’s credit and that the period of payment must not exceed 26 weeks in any period of 52 consecutive weeks. The Act provides that in the event of an emergency, the Minister may suspend the operation of these two restrictions. Now the proposed additional paragraph (1) to Section 41 of the Act, will have the effect that a contributor employed on short time will not be regarded as unemployed unless his contract of service has been terminated, whilst the proposed paragraph (m) will provide that an unemployed contributor shall not be entitled to benefits unless he has been in employment for at least 13 weeks during the preceding 52 weeks. It is felt, however, that both these provisions should also be subject to suspension by the Minister in the event of an emergency arising as far as unemployment is concerned. Hence the proposal contained in 2 (b) of the Bill.

The purpose of the amendment in Clause 2 (c) is to apply to illness, allowance payments and the restriction requiring a contributor to be employed for 13 weeks immediately preceding the date of unemployment. This proposal arises partly from the necessity to reduce expenditure and partly from the view that the primary object of the Unemployment Insurance Fund is to assist temporarily unemployed contributors until they can resume their work. The fund is not intended to provide a source of income for persons suffering from chronic illness and who are unlikely to ever work again. Such persons should receive assistance from other agencies and not from the fund.

Dr. FISHER:

Such as what?

The MINISTER OF LABOUR:

Oh, social welfare, I suppose.

Coming to Clause 2 (d), I may point out that according to the present wording of Section 39 (11) (a) (1), the date as from which maternity benefits are payable is open to doubt and the object of the amendment is to make it quite clear that payments may not be made for any period prior to 18 weeks before the expected date of confinement.

Clause 2 (e) proposes an amendment to Section 39 (11) (b). It arises from the fact that a large number of women cease to be employed when they get married and they have no intention of resuming their employment. Yet they apply for and receive maternity benefits.

Mr. S. J. M. STEYN:

Do you want them to go on working? Would it be wise that they should go on working?

The MINISTER OF LABOUR:

It is for them to decide whether they want to go on working, I think. Yet they apply for and receive, as I say, maternity benefits. I am of the opinion, Mr. Speaker, that such women should not be entitled to benefits unless they can prove that they had become pregnant while in employment. I am proposing therefore that the qualifying period of employment in the case of maternity benefits should be increased from 13 weeks to 18 weeks during the first 52 weeks immediately preceding the expected date of confinement.

The proposal contained in Clause 3 (b) will render persons on short time and persons who have not been in employment for at least 13 weeks during the 52 weeks immediately preceding the date upon which a period of unemployment is deemed to have commenced, ineligible for benefits. They must have worked for at least 13 weeks. The reasons for these proposals are as follows: (a) Payment of benefits to persons on short time is open to abuse by employers; (b) in most industries employers do not resort to short time and it would be unfair discrimination to subsidize employers in certain industries; (c) the payment of benefits for short time would aggravate the conditions of under-employment, in that more workers would be maintained in the industry concerned than warranted by economic forces. The industry would tend to become permanently subsidized and a stimulus would be imparted to the continuance of unemployment and the wasteful employment of labour. The payments for benefits for periods during which contributors are laid off on a short time might cause a very severe drain on the fund, which would necessitate a very considerable increase in contributions. The Unemployment Insurance Fund Board considers that in these circumstances benefits should not be paid to persons on short time.

I think hon. members will appreciate, Mr. Speaker, that the Minister still has the right in terms of Section 39 (3)bis of the Act to suspend this prohibition. As far as the question of the 13 weeks employment is concerned, the Act provides that if a contributor has credits standing to his name, he may be paid benefits even though he has not been in employment or even worked at all for a considerable period. There is no doubt that this has also led to abuse, particularly where married women are concerned. Furthermore, there is no age limit specified in the present Act and any unemployed contributor who is capable of and available for work of some sort is entitled to apply for benefits, even though on account of age he can hardly be regarded as being in the labour market, or he may not himself be seriously contemplating any further employment. As the result the fund has been called upon to pay benefits to old-age pensioners and others who are unlikely ever to work again. In most countries applicants must have been employed for a stated length of time within a specified period in order to qualify for benefits. I give a few examples: In Canada, 30 weeks in the last two years; West Germany, 26 weeks in the last two years; Italy, 52 weeks in the last two years; and in the Netherlands, 78 days in the last 12 months. So that the Board considers that a qualifying period of employment each year should be required, and it has unanimously recommended that a contributor should not be entitled to receive benefits unless he has been employed as a contributor or otherwise for at least 13 weeks, whether for a continuous period or not during 52 weeks immediately preceding the date upon which a period of unemployment is deemed to have commenced.

I turn to Clause 3 (c). As the Act stands at the present moment, a contributor is entitled to refuse an offer of employment if it is not suitable work as defined. In the case of contributors in Groups (1) to (3), inclusive, “suitable work” is any work which a contributor is physically capable of performing, which will not cause undue hardship and for which the wage payable is not less than the benefits would be. In the case of the other groups, “suitable work” means during the first 13 weeks of unemployment, work of a similar class and in the same group as the contributor ordinarily undertakes, and therefore, as in the case of groups (1) to (3), the intention of this provision is to protect the artisan and the skilled worker. But a large number of factory workers fall outside the first three groups and there is a tendency for many of them to take advantage of this provision and to refuse reasonable offers of employment which may be alternate employment. It is considered that the position would be met by providing that the period of grace be reduced to six weeks in the case of groups (4) and (5), since the tendency to take advantage of the position exists mainly in these groups. In the case of groups above group (5) employees often have good reason for not changing the industry in which they are employed because of the various privileges they enjoy, such as sick benefits, holidays and provident funds.

I now come to Clause 4 which provides that an employer who is registered with the fund shall continue to be regarded as an employer if he fails to notify the Secretary for Labour that he has ceased to employ contributors. This will remove a difficulty in areas not often visited by an inspector, more particularly where the public prosecutor is reluctant to institute proceedings in the absence of evidence that a contributor was employed during the period covered by the charge.

Mr. Speaker, I would like to stress the facts that the proposed amendments, which incidentally have the unanimous approval of the Unemployment Insurance Board, will not cause any hardship to any conscientious work-seeker, but they will materially assist in reducing expenditure, a great deal of which is due to nothing but abuse of the fund by people who have no intention or desire to become permanently employed. So what I am doing is that I am trying through these amendments to tighten up the administration of the Act and the provisions and regulations to see whether we can cut down on the expenditure through making provision for the stopping of certain gaps. When that has been done, the other matter of increased contributions by the employers and by the contributors and by the state will be taken into consideration. It is now receiving our attention, but we thought it would be advisable before we came to a question of increased contributions, which will be quite a serious matter, to see whether it would not be possible to reduce benefits which are paid not to deserving cases, but to cases where there have been abuses of the fund. Hon. members probably know of their own knowledge that there have been abuses of the fund. I believe there are many cases where there have been abuse. But my object is to see firstly whether we can bring some improvement in the administration and the provisions of the Act. I move.

Mr. S. J. M. STEYN:

I think that no member in this House has any objection to measures taken to tighten up the administration and to improve the administration of the Unemployment Insurance Act. Certainly no member can cavil with any steps taken to prevent abuse under the provisions of the Act. But the position becomes quite different, Sir, when the House is faced by a Bill such as this which even if it is intended to prevent abuse, seeks to achieve its object by hitting the innocent as hard as the guilty, and we on this side of the House will still have to be persuaded that the majority of the workers of South Africa are guilty of misconduct and abuse of the Unemployment Insurance Act. [Interjections.] I can understand why these murmurs come from the other side. Unless it can be shown that this Bill, which reduces the benefits to which contributors to the fund are entitled, is intended to punish guilty people more than to hurt innocent people, it is a bad Bill. And there is no doubt about it that the effect of the measure is to punish also the innocent. This side of the House cannot be a party to a measure which is directed at the workers of South Africa at a time when every worker in South Africa faces an uncertain future. The time may come in the near future when a great number of workers, completely innocent, will find themselves justifiable applicants for relief from this fund. And the Minister chooses a time like this to come with a measure intended to reduce the benefits and to reduce the rights of the workers! I want to express my personal surprise, my bitter surprise, at the fact that the hon. the Minister who occupies the position of Minister of Labour in the Cabinet, should as his first legislative measure in this House bring this Bill before us. I can remember the days when he was proud of the Unemployment Insurance Act. I can remember the days in 1948 when this Act was under assault from the present Government party that he was one of the main champions who rose in defence of the Act. But his first legislative act as a Minister is to diminish the rights of contributors to this fund. I cannot understand it. And just to make sure that there will be no misunderstanding, I want to move now the following amendment—

To omit all the words after “That” and to substitute “this House declines to pass the second reading of the Unemployment Insurance Amendment Bill because, inter alia, it will detrimentally affect the rights and benefits presently enjoyed by contributors”.

What the hon. the Minister is doing here, if I may make this general remark too, is to reduce the rights of people who have been contributing to an unemployment insurance fund. I am surprised that the hon. the Minister has not moved an amendment for the deletion of the word insurance from the Title of the Bill, because an insurance is a contract of the highest good faith. I can speak of personal experience, and I think many members here can speak of personal experience of how private insurance in South Africa adheres to this principle of the highest good faith which should be observed in all insurance contracts. But not this Minister! Not this Government! I wonder what would happen if private insurers after people had been contributing their premiums regularly over a period of years, suddenly decided to alter the terms of their policies to the detriment of the insured! It is an unheard of thing. It has never happened in the history of South Africa by any respectable company. I know of an incident that is happening now, but that is because the company has become bankrupt. Nobody can convince me that South Africa is bankrupt or that this fund is bankrupt.

An HON. MEMBER:

You have often said so.

Mr. S. J. M. STEYN:

We only have got a Government that is politically bankrupt. I think we should have a look more closely than the Minister helped us to look to-day at the various clauses of this Bill, the objectionable clauses. I am not so worried about Clause 1 (a). It seems to be only right that if a man is subject to a penalty, it does not mean that during the period in which the penalty applies, he should escape the obligations which fall upon normal people who are normally unemployed. I will not quibble about Clause 1.

But there is Clause 2 (a) which provides for a change in the law as it presently stands to this effect that whereas a contributor in the past, since 1950, would earn the right to one week’s compensation from the Insurance Fund for every four weeks of contribution, it will in future be for every “six weeks of contribution”. That is an alteration in existing rights. One could understand it if the hon. the Minister had said that in respect of any new contributor, anyone who from the date of this Bill becomes law, becomes a contributor to the fund for the first time, the altered period should apply. That would be a new contract and one would understand it and the Minister would be perfectly entitled to impose such a condition. But this will now apply to people who are contributors to this fund and over a period of years, believing that they were buying certain rights, have contributed. The Minister comes and changes those rights without consulting them or gaining their consent. I think that here the Government of South Africa is indulging in practices which would be unforgiveable and immoral if the same thing were done by a private insurance company.

Clause 2 (b) gives the Minister the right in case of an emergency, an employment emergency, to suspend some of the disadvantages that are imposed upon contributors in this Bill. Normally one would say that is a good provision. But this provision would have been unnecessary if the hon. the Minister had not committed the injustice that he is asking this House to vote for at the second reading of this Bill. An unemployment emergency! Sir, every case of unemployment is an emergency to the man concerned and to his wife and to his children! Every case! But the hon. the Minister says: I don’t care what happens to individuals, to ten individuals or 1,000 individuals, let them suffer, but if it becomes really large-scale and a lot of people suffer, then I will act. That was not the purpose of the Unemployment Insurance Act, and it was accepted and passed through this House by the party to which the hon. Minister belonged at the time. The Minister in his introductory speech said correctly that the purpose of the Unemployment Insurance Fund was to tide people over a period of personal emergency. It is intended for the individual who is unemployed. Surely if there is an emergency of large-scale unemployment, it would be unfair to expect this fund to carry the whole burden. In a time of national crisis this Parliament, the Government, would have to take crisis action.

Mr. GREYLING:

Calm down, man!

Mr. S. J. M. STEYN:

I can’t calm down about it. I refuse to calm down about it, because here an injustice is being perpetrated against people in this country who in good faith contributed towards a fund, believing that they were entitled to certain rights.

Then I come to Clause 2 (c) which applies to sick people an injustice that the hon. the Minister wants to commit against everybody. He is taking very good care that not even the ill and the incapacitated will escape the punishment that he wants to mete out. He provides that the chronically ill will also suffer. The Minister says that it is not the purpose of this fund to provide for the chronically ill. I think that probably was the intention originally. We should not forget that the Unemployment Insurance Act was amended by the present Government to include cases of illness under its provisions. Now the Minister provides that benefits will not be paid to people unless they were employed for 13 weeks, whether continuously or not, in the preceding 52 weeks. Again I say that if the Minister had made this rule applicable to new contributors, we might have said that the Minister has a case. But he is altering with retrospective effect the rights which people have bought, which they have paid for under a contract. Again I say that if a private insurance company were to indulge in practices like that, it would lose all its business and it would lose the confidence of all people who have any dealings with insurance companies. In fact, Sir, it is inconceivable that any decent South African Insurance organization would do what the Government is asking this Parliament to do.

Sub-section (e) of this clause is perhaps worse. The poor woman who is going to have a baby! The hon. the Minister of Labour seems to have some difficulty about doing justice to women who are going to be in labour. If one wants to understand what the Minister is doing, I think one should take one concrete example. I think we should take the example of a woman who marries on 1 January 1963, after this Bill has become law and the Minister has had his way, if some of the hon. members opposite who represent workingmen constituencies do not stop the Minister. We cannot stop the Minister without their help. I hope they will not be silent in this debate. But if this Bill becomes law, you will have this position that if a woman marries on 1 January 1963, and then finds that she is going to have a baby and that the expected date of her confinement is 31 December of the same year, then one finds that under the existing Act if she applies in advance for those benefits on 30 June, she can rely upon the insurance that she has bought up to six months before her marriage, by having worked for three months in the period six months before her marriage. But now under the Minister’s suggestion, the same woman will have to work after her marriage and after the beginning of her pregnancy.

Business suspended at 6.30 p.m. and resumed at 8.5 p.m.

Evening Sitting

Mr. S. J. M. STEYN:

Mr. Speaker, when the House adjourned for its dinner adjournment, I was referring to Clause 2 (e) of this Bill, and was quoting the example of a woman who got married on 1 January 1963, and who became confined on 31 December. Some of the work she does to-day before her marriage will qualify her for benefits. Under the Minister’s amendment, however, and with particular reference to the stipulation that in future the date of qualification will work retrospectively from the date of confinement and not from the date of application, will have as a result that any work she puts in before her marriage will not avail her at all. It also means that a married woman will in future have to be working when she expects her child. From this there arise two questions. The first of these is “What about the rights and obligations of the Fund towards this woman who might have contributed to it for years and years?” She might have been working for 5, 6 or 7 years before she married and stopped working. What about those rights which accrue to her under the law as it stands to-day and until it is amended by this Bill when it becomes law? She gets absolutely nothing for that. The second question is “Must we now assume that it is the policy of the Government to use economic weapons to force our womenfolk to marry, continue to work when they marry, whether it is necessary for them to work, or not?” This is the effect of this Bill. It offers a powerful inducement to a woman not to stop working when she gets married but to go on working in order not to lose those benefits which accrue to her under the Unemployment Insurance Act. I think that this is a very foolish thing which the hon. the Minister is proposing, because we know from reports which we have had from his own Department, that there is growing unemployment—in fact, it has almost trebled during the last few years. One of the problems facing the Minister and his Department as a result of this is that it is not so easy any more to find work for juveniles. And yet the hon. Minister comes here with a measure which must have the effect of compelling women on marriage to continue to work, thereby depriving juvenile girls of the opportunity of stepping into their shoes and finding work for themselves. This, Sir, can be said to be contrary to the good morals and the interests of the public of South Africa.

Dr. VAN NIEROP:

Why do you use the word “compel”?

Mr. S. J. M. STEYN:

Mr. Speaker, I do not know whether it is for me to give the hon. member for Mossel Bay a lesson in sematics. When you are providing a powerful inducement for a person to act in a certain way, then it is compulsion. This is exactly what the hon. Minister is doing here, namely applying economic compulsion on women for them to work after their marriage. I say again that this is contrary to the morals and to the interests of the public in South Africa.

Then, Sir, we come to Clause 3 (b) which provides that short-time will no longer be a qualification for people to receive benefits from the unemployment insurance fund, unless the Minister finds that things have come to such a mess in South Africa that he has to declare an employment emergency and to repeal the measure he has now introduced. The reason of the hon. the Minister for this deprivation of rights is that he does not want to be in a position where the unemployment insurance fund should be used to subsidize employers who arrange their affairs in such a way that the unemployment insurance fund supplements the wages of their employees. That was a very drastic statement for the Minister to make. When he made it, I sat back and I waited for him to quote examples of this particular malpractice in the past. This has been law for some time now, Sir, and surely the hon. the Minister could have told us, if he did not want to quote particular examples, that it has happened in the past and that it is a bad thing. But on two or three places in his speech he only spoke about the “possibility” and never once referred to the actuality of the situation. In other words, Sir, it is pure speculation on the part of the hon. Minister to say that it has happened. Furthermore, it is an insult to the employers in South Africa to make such a statement. I hope in his reply he will give us examples of these malpractices. He has given us neither proof nor evidence so far that such a state of affairs exists in South Africa. So he is not willing to subsidize firms who place their workers on short-time, but he is quite willing to offer an inducement to employers to dismiss their workers. You see, Sir, I know from experience—and the hon. the Minister should know too—that sometimes it is an enlightened employer who places his workers on short-time, because he does not want to throw people on the street in time of economic stress. After all, they have given him years and years of loyal service and he feels that he owes them something for that. He does not, therefore, want to destroy their security in life and make them dependent upon the unemployment insurance fund completely. So he comes to an arrangement with them that some of them will work shorter time so that all of them can remain in their work in the hope that the position will improve and that they will then be placed on a normal footing again. Now, however, it will be difficult in view of the provisions of this Bill, to make such an arrangement. Rather is he tempted to put these people out of work so that he can get rid of any responsibilities. Here again, Sir, the hon. Minister is taking a very short-sighted course. I suggest that he has not thought this through which he is suggesting to the people of South Africa.

This clause further lays down that in order to qualify for unemployment benefits in future, workers will have to work 13 weeks out of the 52 weeks preceding their unemployment. I have already referred to this principle when I dealt with people who become ill because the same principle will apply to them. I want to emphasize that the Government is hereby taking away rights from these people, rights which they have bought in good faith. Because, Sir, they have paid for these rights, but now the hon. Minister is taking them away. I want to tell you, Sir, what is worrying me. The hon. Minister of Finance told us in his Budget speech what we already knew, namely that there was a tendency, again in the first few months of this year, for unemployment to increase. Will hon. members try to think who the people are who, apart from juveniles to whom I have already made reference, are the most difficult to place in work in times of growing unemployment in South Africa? These are the elderly people—people of 45, 50 or older; not old age pensioners, but people who will be in the prime, in the most useful period, of their lives. Experience has shown that it is extremely difficult to find work for a man who loses his employment at the age of 50 or there about. These are people who will probably have contributed to this fund for the major part of their working lives. The Minister and his Department will then have to battle to find work for them, something which experience has shown is not an easy task. But knowing that, the hon. the Minister nevertheless comes along and proposes that these people should get unemployment insurance only for the first 26 weeks of their first year of unemployment, while they in fact have contributed to the fund for 10, 15 years and are entitled to twice that benefit. So the Minister is taking away their rights in that respect from them. I should like the hon. Minister when he replies to tell us what solution the Department of Labour has to offer to the problem these people of over 50 years will present once they have drawn their benefits for the 26 weeks.

Clause 4 of the Bill is not so objectionable as most of the clauses are. But Clause 5 is an interesting clause. If the Minister has done this in another context we would have appreciated it greatly, namely to introduce a conscience clause! Here in Clause 5 the hon. Minister admits guilt; he tries to satisfy his own conscience that it is not as bad as it looks, because Clause 5 provides that all these rights which are being taken away in this Bill will continue to exist, if the man or woman is qualified, for six months after this Bill has become law. What a confession to make! If I had any doubts whether this was a negative Bill which entailed a diminution of rights, then Clause 5 dispels those doubts. Why should this have happened? You know, Sir, that there was a time when this Government claimed that it was the working man’s Government.

HON. MEMBERS:

It still is.

Mr. S. J. M. STEYN:

But it is not so tonight, Sir. There is no evidence of that tonight. Why is this done? I want to suggest the reason for it: It is being done, Sir, because the Government, and the hon. Minister of Labour has been guilty of a grave miscalculation and of a grave error of judgement. In the years preceding the last two general elections they greatly increased the benefits payable from the fund and at the same time decreased the rate of contribution to the fund. They did that because they believed that prosperity would continue in the country and that there would be no growing unemployment while this Government was in power. They were hoping that the chickens would never come to roost in respect of the policies they were pursuing. But now, Sir, the chickens are beginning to come home to roost, because the unemployment figure for those who register for employment has gone up—I speak only of those who register for employment. And they are the minority of workers in this country. For them the unemployment figure has gone up from 12,000 to over 30,000. There is now a drain on the fund and they have to withdraw the investments at a rate of millions of Rand a year. So the only reason for this Bill is that this Government has miscalculated the prospects for South Africa under its own administration. For that the working man has now to pay the penalty. The hon. the Minister told us that he was considering increasing contributions, although not this session. He would do it next session, i.e. in a year’s time. But how does he know that he will be able to justify such an increase in a year’s time? Is he then such a pessimist? Why, Sir, does he pick on the working man first? Why does he not come with a Bill to do it all simultaneously? That would have been just and understandable in so far as he could not do otherwise. Why does he pick first on the working people? The hon. the Minister endeavoured to tell us about some of the principles underlying the Bill but suggest that there are other principles underlying it than those he mentioned. It is the duty of the Opposition, Sir, to reveal the true principles. One of the hidden principles is to save money, not for the principle of saving money, but to save for the Government one of its cheap sources of capital. How many times have we on this side, and especially my hon. friend the member for Kensington complained that the money which was being accumulated for the purpose of protecting the working people of South Africa against unemployment was being invested at rates which could not be justified considering the state of the money market and the cost of money at the time the investments were made. But now, Sir, this source of cheap money is being drained because the funds are being used for the purpose for which they were accumulated, namely to help people over a period of temporary embarrassment. But through this the Government is losing cheap money and immediately the worker is being called upon to make sacrifices to restore that source of cheap money to an embarrassed Government. That is the first hidden principle which underlies this Bill. The second hidden principle is that if you cannot administer a difficult Act like the Unemployment Insurance Act efficiently, and if you cannot by means of proper administration prevent abuses, then go on a punitive expedition and punish all the workers whether they are guilty or innocent —even if you punish more innocent then guilty people as is happening under these provisions. This, Sir, is unforgivable. It is the most wicked thing which I have seen happening in the South Africa Parliament for the past 14 years. [Laughter.] I am glad there is laughter because it is the most revealing laughter that has run through South Africa for many years. When we are protesting on behalf of the working people of South Africa we get these guffaws from the opposite side. I want to repeat, Sir, that if the hon. the Minister had come with one Bill under the present circumstances to increase contributions also, we would have understood it perhaps. But now he is going to penalize the workers for a year in advance probably hoping that it will not be necessary to penalize the employer at the end of that year. We would also have had sympathy with him, Sir, if he had applied these punitive measures only to future contributors and not to people who have already contributed in the past and who believed that by doing so they were acquiring rights which should be regarded as sacrosanct according to all the conceptions which surround the concept of insurance.

Mr. HOPEWELL:

I second.

*Mr. VAN DER WALT:

*Mr. Speaker, we have once again seen the hon. member for Yeoville (Mr. S. J. M. Steyn) at his best this evening. He is known to this House as a master of overstatement. Everything usually assumes extraordinary proportions as far as the hon. member is concerned. He helps hon. members on the other side to see ghosts. Let us take and analyse a few of the exaggerations which he made. He contends that by means of this legislation we are seeking to tell the country and the workers that the vast majority of workers are guilty of malpractices in regard to the Unemployment Insurance Fund. But that is not true. There is no truth at all in this statement. The hon. member himself will admit that there are malpractices but to suggest that we contend that the vast majority of workers are guilty of malpractices, is devoid of all truth. He came to light with another allegation in this House, namely, that we are doing these things without consultation. But that is also not true. Everything which stands in this Bill has been recommended by the Unemployment Insurance Council and this Council consists of an equal number of representatives of employees and employers. Let me tell the hon. member who is serving on that Council and then he can tell me whether this is not consultation, where the Minister is acting on the advice of this Council. These persons are: Mr. Bolton, representing the Associated Commercial Employers of South Africa; Mr. Burger of Cape Town who is connected with the Federated Chamber of Industries; Mr. Carstens of the Afrikaanse Handelsinstituut; Mr. du Plessis representing the Confederation of Employers’ Organizations; Mr. Warrell of the Transvaal and Orange Free State Chamber of Mines; Mr. de Villiers as the representative of the South African Labour Confederation and Messrs. Rem, Steyn, Tyler and van den Berg as the representatives of the workers. These people have recommended what is contained in this Bill and yet the hon. member for Yeoville comes along and says that the hon. the Minister has framed this legislation without consultation while under the Act which the United Party passed in 1946, this Council was established for the exclusive purpose of advising the hon. the Minister. Now the hon. member has the audacity to come to this House and to say that there was no consultation.

He goes on to say that we have been bestowing all sorts of privileges before general elections but that the results of this are catching up with us to-day. Let me state in this connection that the Unemployment Insurance Fund was certainly never brought into being to go on increasing its assets. At some or other stage the expenditure incurred in respect of unemployment had to exceed income. We are not denying that there has been some measure of increase in unemployment. But here too the hon. member exaggerated because, as I have said, everything assumes greater proportions as far as the hon. member is concerned. It is really true that we have a large-scale unemployment in South Africa to-day? What is really the percentage of unemployment in the country to-day? At the moment it is 2.49 per cent. Two per cent. is regarded as normal because there are always certain people who are unemployed. Indeed, 2 per cent is accepted as a condition of full employment. Our position therefore is .49 per cent more unfavourable than what is normally regarded as full employment. We do not deny that there has been a slackening off to some extent in the economic sphere in South Africa but the Government has already announced steps with a view to overcoming that economic recession. We do not deny that. However, let us compare ourselves with other countries. Other countries also have their economic recessions. If one studies the information of UNO regarding unemployment, one finds that the unemployment figure in Belgium in December 1961 was 4.8 per cent; in Canada in October 1961 it was 4.9 per cent; in Ireland in November 1961 it was 5.7 per cent; in the U.S.A. in November 1961 it was 5.6 per cent. We do not deny therefore that there has been some degree of unemployment but it is completely wrong to exaggerate it and to make out that it has assumed terrible proportions. It is a pity that hon. members on the other side continually seek to exploit matters for the sake of political capital. Our complaint against the Opposition in fact is that they do not wish to assist the Government in restoring confidence in our country so that our economy can once again expand. Our other complaint against the Opposition is that they sometimes make statements and say things which are detrimental to the economy of the country. In this connection we need only think of the hon. member for Wynberg (Mr. Russell) and what he said a few days ago in this House. Let us think too of the debate on such a vitally important matter for South Africa as Defence which took place last week in the Other Place. This is our charge then against the Opposition, namely, that they do not assist us to give the economy of our country the impetus which it needs to continue expanding for the sake of the workers and for the sake of South Africa, our homeland. They are always prepared to paint a black and exaggerated picture of South Africa.

The hon. member for Yeoville waxed lyrical this evening about the interests of the workers of South Africa. He said that this Government posed as the champion of the workers. I say with every confidence that I still regard this side of the House as the champion of the interests of the workers in South Africa. In contrast to this, the workers know the Opposition; they know the United Party. They know the United Party as a Party which continually comes to light with promises which are then just as quickly forgotten. How many promises have not been made by the United Party within the period of the past 12 years and then forgotten? Those promises were forgotten because in the first place they were half-baked and ill-considered. Mr. Speaker, the workers of South Africa will not forget either that the hon. member for Yeoville, the hon. member for Turffontein and others have come to this House year after year with motions that the Unemployment Insurance Fund should be used as the basis of a national pension scheme, and that they have tried to destroy the fund in that way. This is a policy which they have advocated in this House for years and which they have put before the voters of the country. However, I am pleased that sound advice has apparently triumphed on that side of the House and that they have abandoned that ill-considered plan. The workers of South Africa will also remember that it was the United Party which in the years 1947-8 made such a shambles of the Unemployment Insurance Act that the then Minister of Labour of the United Party Government was compelled to suspend the operation of the Act for three months and to appoint a commission of inquiry to go into the operation of the Act. The hon. member for Yeoville referred to the present Minister of Labour and said that in 1946 when the Act was placed on the Statute Book he thought that it was such a wonderful Act. The fact is, however, that the United Party made such a failure of the application of that Act that it had to be suspended for three months and that a commission of inquiry had to be appointed which deliberated on the Act for 18 months. It was also the National Party Government which in 1949 had legislation enacted to place the Unemployment Insurance Fund on a sound basis. The United Party Government went so far as to bring in all the Bantu workers in industry within the scope of the Fund. What was the result of this ill-considered and stupid action on the part of the United Party? The result was that thousands of Bantu workers began to lie idle with the sole object of receiving unemployment benefits. That idleness assumed such proportions that the Gold Producers’ Committee of the Chamber of Mines had to warn the then Government in 1948 against this particular provision in the Act. For example, they also included seasonal workers under the legislation, that is to say, people who regularly became unemployed and who as such had to be a regular burden on the Fund. They even went so far as to bring in married female teachers and ministers withing the scope of the Fund. It was the present Government which, when it came into power in 1948, had to rectify the position and place the Fund on a sound basis. On that sound basis the assets of the Fund grew to the colossal amount of about R140,000,000 and it was because the Fund grew so phenomenally that the Government then decided to make certain concessions. We are grateful that the Government saw its way clear to make these concessions to the workers. I would like to refer to a few of these concessions. The hon. member says that we have actually used the money too-royally but I want to say in my turn that workers as well as employers have been grateful for the concessions which this Government has made to them over the past 13 years. The contributions of workers and employers to the Fund, for example, have been reduced by half—and in some cases more than half—of what they were in 1948-9. In the highest wage group employers and employees to-day contribute 20 cents jointly per week. In 1948-9 this amount was 40 cents; in other words, twice as much. The fact is that for certain wage groups the contributions have even been reduced by more than half. Indeed, the Fund rose to such an extent that even the Government reduced its contribution from 50 to 25 per cent of the contributors’ contribution. I say again that I am grateful that the sound basis on which the National Party Government placed the Fund made these concessions possible. Notwithstanding these concessions, however, it was possible so to increase the benefits from the Fund that South Africa’s legislation in this sphere was quoted by the International Labour Organization as being one of the best and most favourable in the world. That was in 1956. I should like therefore to mention a few examples to show how these benefits to workers from the Fund have been increased. In 1948 the highest wage group which fell under the Act received a weekly benefit of R5. At the moment the highest wage group draws a benefit of R14— an increase therefore of 180 per cent.

*Mr. DURRANT:

To which wage group are you referring?

*Mr. VAN DER WALT:

If the hon. member had studied the Act he would have known that this was wage group No. 7 under the Act of 1946. This group only received R5 per week in benefits under the 1946 Act. To-day wage group No. 12—this wage group is equivalent to wage group No. 7 at that time—draws R14 per week. However, apart from these benefits, Mr. Speaker, a large number of new benefits have been created. In 1952, for example, sick benefits were instituted.

*Mr. DURRANT:

Who suggested that?

*Mr. VAN DER WALT:

That hon. member has apparently suggested everything, Mr. Speaker. I sometimes wonder whether he did not suggest his own birth! As I say, sick benefits were instituted in 1952 which made it possible for any contributor to the fund who became unemployed as a result of illness or who retained less than one-third of his income, to be considered for sick benefits from the fund. In 1960 these benefits were paid to 23,736 employees and the amount involved was R2,890,790. This was a big contribution towards the maintenance of those workers who became ill in 1960. In 1954 a second new and important benefit was instituted, namely, maternity benefits. Let me mention the year 1960 again. In 1960 there were 22,702 female workers who drew benefits in this regard. The hon. member forgets that 22,000 women obtained benefits under this provision in 1960 and the expenditure connected with it was R2,476,000.

*Mr. S. J. M. STEYN:

Is that very wrong?

*Mr. VAN DER WALT:

I shall come back to this question of misuses. The next step which the Government took was to introduce death benefits in 1957. I want to say immediately that if there is anything in regard to which the Government can perhaps be criticized it is in regard to these death benefits but we still believe that this was a very great advantage to the dependants of deceased contributors. In terms of this benefit the widow or her dependent children receives benefits for six months in a lump sum on the death of the contributor and in the year 1960 death benefits amounting to R669,000 were paid to the widows of 2,746 contributors. Through these benefits thousands of people received assistance, people who found themselves in the greatest need. If we add all these things together, I think that in the year 1960, 49,000 contributors benefited from the new benefits which the Government introduced and the colossal amount of R6,000,000 was paid out to them.

We admit that unemployment is a contributory factor but I say that it was only to be expected that at some time or other the expenditure of this fund would exceed its income if we had a period of unemployment. However, this is not the only factor which has contributed to this unfavourable position of the Fund. As I have already stated, the contributions of the Government and of employers and of employees were reduced by at least 50 per cent. I want to point out further how the contributions were reduced as a concession to employers and contributors. In 1950 there were 550,000 contributors to the Fund. They contributed R13,000,000 to the Fund. Ten years later, in 1960, the number of contributors was 767,000 and they contributed only R4,750,000 as against R13,000,000 ten years previously. In other words, a tremendous concession was granted in respect of the contributions and this resulted in large sums of money remaining in the pockets of the employers and the workers. The number of contributors rose by 39 per cent but as a result of the lowering of the contribution tariffs the income dropped to one-third of what it was in 1950.

But there is another very important reason why the expenditure of the fund rose and that is the pattern of rising earnings of our industrial workers in South Africa. In terms of the Act benefits are being paid on the basis of 12 wage groups at the moment. In 1948 there were seven wage groups. I would like to compare 1950 with 1960. In 1950 the wage limit of the highest wage group was fixed at between R884 and R1,500. There were 109,034 contributors in this wage group to whom the highest unemployment benefits were paid. However, as a result of the consolidation of cost-of-living allowances and the rising earnings of the workers, the maximum earnings of the highest group in 1957 rose to R2,500 and two new wage groups with higher incomes were created at that time. In 1957 these higher wage groups immediately brought in an additional 60,000 workers who contributed to the fund and who also had to be considered for benefits. In other words, whereas in 1950 there were 109,000 workers belonging to the highest wage group, in 1960 there were 346,000 workers in the higher wage groups. One can understand that every time that workers rise from a low wage group to a higher wage group, they immediately draw increased benefits although they have contributed at the lower tariff. This has been a great drain on the Fund and has contributed to this unfavourable position of the fund.

There can be no doubt that the Unemployment Insurance Fund has become an emergency relief fund to a very large section of our workers. Since these benefits have been increased to such an extent I think every right-thinking person—and I am sorry that I cannot include the Opposition in this—will assist the hon. the Minister in trying to eliminate abuses. Since these benefits have been so greatly increased, one would think that the Opposition would assist us to eliminate these misuses. We are accused of creating hardship, but I think that we can actually be accused of being too generous. However, the purpose of the Unemployment Insurance Act is to be of assistance and to protect workers during times of unemployment but this law must not be misused to create artificial unemployment and to demoralize the worker in South Africa. If we were to permit these benefits to encourage a large number of workers to become unemployed artificially, with the strong competition of to-day, we would have to pay dearly as far as the productivity of our labour force is concerned. Therefore I want to emphasize once again, as I said at the start, that all these amendments which are now being effected to eliminate these malpractices were recommended by the Unemployment Insurance Council. My own idea is that it is completely wrong to speak about hardships. I cannot believe that the representatives of the workers on that Insurance Council who made the recommendations would contribute towards the hardships suffered by workers. I would like to deal with the clauses of the Bill. As the hon. member for Yeoville clearly stated, it is provided in the principal Act that a worker who has resigned his employment because of misconduct or without sound reasons, may be punished by having his benefits postponed for six weeks. I know that the hon. member for Yeoville (Mr. S. J. M. Steyn) has agreed that they have no objection to this. All that this clause does is to say that if a work-seeker stays away and does not sign the register, the claims officer will be given the power to fine or punish him by means of an extended period without benefits. If a contributor is punished for six weeks because he has resigned his work without good reason or because he has lost his employment because of his own misconduct and then simply stays away for those six weeks and does not present himself at the labour bureau, it will be difficult to place him in employment, because during those six weeks when there was no trace of him suitable posts may have been found which are no longer available then. Therefore this amendment is being introduced to ensure that in those six weeks this workseeker will present himself regularly at the labour Bureau. I do not think that the ordinary reliable workers will be affected but only those people who regularly change their work. The next clause is Clause 2 which limits the benefits to one week’s benefits for every six weeks’ completed service as contributor. I want to tell the hon. member for Yeoville that all that the hon. the Minister is now doing is to bring the law in conformity once again with what it was in 1946. In 1946 the provision was that a contributor was entitled to one week’s benefits for every six weeks during which he contributed, and that provision was amended in 1950. All that we are doing now is to bring it back to the basis upon which the United Party established it, and there are many good reasons for this. It is not going to affect the good and reliable worker because he will build up large credits but it is going to affect and penalize the worker who resigns his employment often, so that his benefits will be built up one-third more slowly in the future. He will now receive a week’s benefits for six weeks. In other words, it is built up one-third more slowly. This means that the worker who often resigns his employment will not have very large credits. This does not penalize the good worker; it penalizes the man who is work-shy and who changes his employment often or becomes unemployed. This amendment is being effected to pin him down.

The hon. member said “We are busy punishing the sick and the innocent”, because an amendment is being introduced in connection with sick benefits. The facts are as I have mentioned them. The sick benefits were introduced in 1950 and they entail a tremendous expenditure of more than R2,000,000. Under the existing provision, however, a contributor qualified if at any time for 13 weeks he was a contributor to the fund and if he still has credit with the fund. This had the effect that even chronically ill people could be considered for benefits even though they were no longer bona fide workers or potential workers. All that they did was that they presented themselves for one or two weeks for employment and having worked for that week or for two weeks they were entitled to be considered for benefits.

*Mr. S. J. M. STEYN:

How can you say such things? They had to work for at least four weeks.

*Mr. VAN DER WALT:

That is true. The sick man who only built up credits in a short period is not the type of a man who will stay away from work for a year or more. [Interjection.] I repeat that the purpose of this provision is only that a man who stays away from work for a long time must be pinned down. Therefore it is now being provided that he has to work for at least three months in the year preceding his application.

We come to the question of maternity benefits which are now being improved. These benefits were introduced in 1954 but there have been many complaints that they have been abused by married women. The hon. member for Yeoville said that the hon. the Minister mentioned no examples but I want to give the House information which has been given to me. This information is that at the moment there are 8,700 unemployed women who are registered and according to a survey made by the Department 70 per cent of them are not bona fide work-seekers. The hon. member now says that we are forcing them to work but if they want benefits I think that they must be regular workers. If they work temporarily just to receive benefits they stand in the way of unmarried women who want employment. In other words, you cannot permit such people to be a drain on the Fund.

*Mr. RAW:

Have they contributed or not?

*Mr. VAN DER WALT:

They have contributed but let me say something now about the contributions. Take the question of confinements. The same malpractices have arisen here where people contribute, perhaps for a long time, and then marry and are no longer regular workers.

*Mr. DURRANT:

That is not a malpractice. The law says that.

*Mr. VAN DER WALT:

Yes, that was in the law but the law was not passed to provide benefits to people who do not work. The law was enacted to help the bona fide worker. Let me say again that these benefits are abused in this way that married women who do not wish to work any longer, go out and work for a week or three as soon as they fall pregnant, and thereafter they can be considered for benefits. It is now being amended therefore. As the law now stands they receive benefits for 18 weeks prior to the confinement. It is now provided that they will have to work for a further 18 weeks in the year preceding the confinement. This means 36 weeks or nine months. This will enable the regular worker to obtain these maternity benefits but those who do not work regularly will not obtain them.

*Mr. DURRANT:

Those are not the true facts.

*Mr. VAN DER WALT:

They are the true facts. There is also the other group who fall under that provision, the older workers. The hon. member waxed lyrical about the older workers. I want to say immediately that this law is an insurance law. It is not a law which accumulates funds which anyone can draw. It is there to protect workers in time of unemployment. Older people of 60 or 70 years— it does not affect the people of 40 or 50 years whom the hon. member mentioned who can still work. They can work for 13 weeks before they apply for benefits. It affects the older people who have built up benefits but who no longer work. They are no longer bona fide workers. They only make application for work for one or two or three weeks and then they are again considered for benefits. That is why this provision has been instituted so that this matter can be rectified. The hon. member spoke about abolishing short-time work and he asked on what grounds we were doing this and what evidence we had. I would like to give the evidence from the report of the Unemployment Insurance Council of 1958 on page 17. They say—

A request for support was received from a trade association of which many members worked fewer than the normal hours per week and accordingly earned less. Acting on legal advice it was decided to pay out benefits to any contributor who was laid off for a full week or longer and who received no wages although his service contract was not terminated. During the period August to December 1958, 690 such contributors received benefits to an amount of £3,674.

The Unemployment Insurance Council opposed these provisions. These provisions were not in the law but on legal advice they discovered that loophole in the law and these benefits have been paid in the past four years. However, the Council opposed these payments and asked the Minister to abolish them and the reason which they gave was because it resulted in unjust competition between certain employers and others and because it subsidized certain employers at the expense of others.

*Mr. RAW:

Nonsense.

*Mr. VAN DER WALT:

No, that is so. How can the hon. member say it is nonsense? If you pay an amount to certain workers of an employer, employees for whom that employer is not responsible, you then subsidize his employees and you find that employers will be inclined in a time of recession to encourage their employees to apply for those benefits. This is a way in which employers can abuse that provision. Therefore, the Council recommended that this opportunity to obtain benefits in that way should be abolished.

I want to conclude by saying this. The hon. member says that we have taken away rights which people have bought with their own money. We must make an appeal to the workers of South Africa. The Unemployment Insurance Fund is an insurance law. It insures people who are unemployed but it is not an investment fund into which people pay money which they can demand should be repaid to them. If people do not become unemployed in their careers and are not repaid their money, they must be grateful because they have had an income. They must not become unemployed deliberately simply to obtain benefits. That is not the purpose of the Fund. Therefore we want to make an appeal that the worker must co-operate with the Government to combat this draining of the Fund as far as possible by the elimination of these malpractices.

Mr. DURRANT:

The hon. member for Pretoria (West) (Mr. van der Walt) not only seeks to manipulate the physical form, but he also sought in the course of his speech to manipulate the truth to suit his arguments. [Interjections.]

Mr. SPEAKER:

Order!

Mr. DURRANT:

I wish to say that the hon. member has based his speech on untruths. Let me show up a few of them. The hon. member made the categorical statement that the Act of 1946 was suspended by the United Party Government. I challenge the hon. member to prove it.

Mr. S. J. M. STEYN:

He cannot.

Mr. DURRANT:

I am going to prove the palpable untruth the hon. member uttered here to-night. [Interjections.]

*Mr. VAN DER WALT:

The hon. member says I told an untruth. I can give the proof. Will he allow me to do so?

Mr. DURRANT:

The hon. member for Pretoria (West) need not concern himself because I will bring the evidence and I will use his own Minister as a witness to prove that the hon. member told a palpable untruth when he said that this side of the House suspended the 1946 Act. I am going to quote from Vol. 68, Col. 6513, of 25 May 1949. This is what the then Minister of Labour, Mr. Schoeman, had to say when the Unemployment Insurance Amendment Bill was brought before the House. He said this at the very commencement of his speech, talking about the 1946 measure—

Immediately after it was promulgated, the tests and objections commenced to pour in. After being in operation for only three months, my predecessor decided to suspend the Act, but so much pressure was brought to bear upon him that he was compelled to reverse his decision, and instead of suspending the Act he appointed a commission of inquiry.

Now what does the hon. member say? That is the evidence of his own Minister. Let me indicate a few of the other untruths and halftruths on which the hon. member based his speech.

*Mr. MARTINS:

On a point of order, may the hon. member say that the hon. member has told untruths?

The ACTING-SPEAKER (Mr. Pelser):

The hon. member may continue.

Mr. DURRANT:

The hon. member said that a respectable Opposition would assist the Minister to combat the abuses which are taking place. I want to remind the hon. member that he was in the House in 1961 when this side of the House supported the Minister of Labour in respect of the provisions that were then introduced in the Amending Act of 1961 to combat the very evils and abuses which the hon. the Minister to-night again referred to in his speech. Let me remind the House that amendments were introduced to take care of the position where contributors failed to report and this side of the House made suggestions and moved amendments to assist the Minister to combat this evil. In respect of sickness benefits where there were abuses, amendments were introduced last year and this side of the House assisted the Minister to combat those abuses. When it came to people who were abusing the fund and taking holidays at the expense of the fund, it was this side of the House which assisted the Minister to combat that evil. Let me take another instance. The hon. member says it was his side of the House, the Government, which introduced the additional benefits such as maternity grants and sickness allowance and death benefits.

Mr. VAN DER WALT:

Are you against it?

Mr. DURRANT:

I am not against it, but I am going to prove that he told an untruth. There sits the Minister who can testify that it was this side of the House which moved and suggested and made these proposals for these additional benefits to be paid to the workers, and let the Minister deny it. He was a party to it when these propositions and motions were moved by this side of the House. The Minister can testify that any constructive proposals that came or the use of the Fund for the benefit of the workers were in fact made by this side of the House in the past ten years. Now the hon. member says it was the Government which introduced them.

Then the hon. member gave us a lengthy discourse on the benefits that accrued to the workers because their contributions were reduced in 1957. He said even the Government’s contributions were reduced by 25 per cent and the workers’ contributions were halved, and the employers’ contributions were halved. But the hon. member did not continue, as I challenged him to continue, to say that the workers’ contributions to the fund were retained on a sliding scale, but the employers’ contributions were pegged, and that the pegging of the employers’ contributions in 1957 is one of the reasons why the fund to-day is declining, whereas in former years its capital increased.

Mr. VAN DER WALT:

That is not the truth.

Mr. DURRANT:

I will show the hon. member in a minute that it is true. It shows the extent of the knowledge of the hon. member for Pretoria (West) in regard to this fund, if he says that the employers’ contributions are not pegged.

Mr. VAN DER WALT:

They are pegged.

Mr. DURRANT:

The hon. member said also that it was never intended to build this fund up to astronomical figures.

Mr. S. J. M. STEYN:

What? Did he say that?

Mr. DURRANT:

Yes, and let him deny it. He said it was never intended that this fund should continue to increase, but that it should be retained at a level where it could meet its obligations. Like every other Government member, when it comes to playing politics with the interests of the workers, they present the point of view which at the moment suits them politically. But the hon. member for Pretoria (West) forgets that he spoke himself when the Bill was before the House in 1957. May I remind him of what the then Deputy Minister of Labour said? In that year the Deputy Minister put up a powerful argument that the fund should be allowed to continue to increase to give security to the workers, and he used the Rand Daily Mail as evidence.

Mr. MOORE:

What?

Mr. DURRANT:

He quoted this relevant portion from the Rand Daily Mail and he used the example of what had happened to the Unemployment Insurance Fund in Britain. He said—

In 1920, when conditions were comparatively favourable, an optimistic view of future employment was taken, but subsequently the fund went through a period in which the amount of benefits paid grew substantially because of the later increase in unemployment. At one stage I believe the fund in Britain had to be subsidized heavily by the Exchequer. After all, one must learn from what happens in the rest of the world. This experience is certainly a lesson to South Africa and it is a reply to those people who constantly ask that this fund should be restricted.

I would ask the hon. member for Pretoria (West), who suggested to-night a restriction on the capital growth of the fund, to take note of the words of the Deputy Minister of Labour.

But let me come back to the hon. the Minister. I am surprised that the Minister in this first measure he has brought before the House should allow himself to be swayed that he could present such a measure which is obviously detrimental to the 768,000 contributors to the fund. Throughout his political life the Minister has represented working constituencies. He represented Brakpan and Bezuidenhout. He should have an understanding of the feelings of the working men and women of South Africa. I am surprised, knowing the Minister as I do, that he has permitted himself to be inveigled into the position of having to come with a measure of this nature. But he comes with this measure and offers only one reason really for its justification, that there is a decline in the capital funds and he must take steps to stop it, and the step he is going to take is to apply these restrictions in regard to certain classes of benefits. The first restriction is on illness, on the sickness of the worker. The second benefit that is now restricted is to stop the benefits of the worker who goes on short time. The third one is for the working women, and the fourth one is a general application of restrictions to all the 768,000 workers. Let me take one instance. What saving, in fact, will result to the fund by the restrictions now being placed on sickness benefits? What do the figures reveal? We find that R2,890,000 was paid to 23,736 contributors for the year ending 1960, according to the latest report. This represented only an increase of some R250,000 over the former year, and as I understand the latest figures they are also in that region, with a slightly smaller increase. So in order to curtail the sickness benefits for the comparatively small cost of R250,000, the Minisster has taken these steps which are obviously prejudicial to the interests of the workers.

Let us take another one, short time, about which the hon. member for Pretoria (West) had so much to say. What is the saving that will be affected there? What do workers get for short time? Contributors who are laid off for a full week or more and receive no wages are entitled to benefits, although the contract of service has not been terminated. The beneficiaries for 1960 amounted to 6,276, who received benefits totalling the comparatively small sum of only R69,384. That is the point, R69,384. It is like tickey-snatching out of the pockets of the workers of South Africa. And of the 6,276 who got the benefit? Five thousand and eighty-five of the hon. member for Germiston’s (Mr. Cruwagen) constituents who worked in the clothing industry. I am surprised to see that the hon. member for Germiston is not putting up a fight for his constituents in this House to-night.

Mr. RAW:

He is not interested in them.

Mr. DURRANT:

What is even more incredible in this measure is how members of the Government change their attitude or their political approach as it suits them. In 1957 when the rate of contribution in respect of workers and the rate of contribution in respect of employers and the rate of contribution by the Government was reduced, there was a completely different approach to unemployment. Let me indicate to the House the attitude which was then adopted. I quote from Col. 1067 of Hansard, Vol. 93. This was what the then Minister had to say—

This is a time of full employment, and in the good years we should fill our warehouses in order to cope with the possible lean years which might follow.

A very laudable sentiment, Sir—

The latest increase in benefits took place in 1954 and we can now safely increase benefits and reduce contributions and other concessions can be made available for the benefit of both employers and employees.

That, Mr. Speaker, was said on 13 February 1957.

Mr. S. J. M. STEYN:

Who said that?

Mr. DURRANT:

The then Minister of Labour. The Government was able to be optimistic at that time, but that optimism was attributable not to Government money but to the workers’ money because this fund belongs to the workers; it does not belong to the Government. It was the workers who contributed. During the whole history of this National Party Government they have only contributed something like R34,000,000. That is all, the rest comes from the employers and the employees of South Africa. When you look at the report of the Auditor-General you realize that the feeling of optimism which was displayed prior to the general election was not justified at all. When you look at the report of the Auditor-General you find that deficits have been reflected in this fund since 1957 and not since 1959 as the hon. Minister stated, which I assume was a mistake on his part. It indicates clearly the manner in which the Government is prepared to exploit at the least provocation for political gain, the interests of the workers of South Africa. What did we warn the Government against at that time?

Mr. GREYLING:

What do you mean by “political gain”?

Mr. DURRANT:

The hon. member has apparently just woken up, Sir. We warned the Government at the time when this step was taken, that the step which they were taking and the manner in which they were taking it, would result in a possible decrease in the capital account of the Unemployment Insurance Fund to the detriment of the workers of South Africa. We warned the Government for this reason that formerly the level of contributions by employers and employees had always been based on some actuarial valuation as to whether the fund could or could not meet its obligations. But the Minister of the Nationalist Party Government of the day made an arrangement which had never been made before. He threw the onus upon the worker representatives and the employer representatives because pressure was being exerted at that time by the workers to raise the level of the benefits that could be paid to workers from a maximum of £750 as it then stood, to £1,250 and because the Government would not assume its obligations and its responsibilities in that regard, he threw the onus as to what should happen in that regard upon the Unemployment Insurance Board representatives of employers and employees. They came to a compromise agreement, an agreement under which the employer representatives would recognize the rights of the employees to additional benefits, provided that the employer contributions were pegged at a fixed level which was fixed at 9d. whereas the employees in the higher income groups had to contribute as much as Is. We warned the Government at that time of the losses that the fund would sustain as a result of that arrangement. To prove it, Sir, I would like to quote to the House what was said then so that there can be complete understanding about this matter. I am quoting from Hansard of 7 February 1961. I don’t want to quote what was said in 1957. This reinstates the position. I quote (Col. 982, Vol. 106)—

When one analyses the position one finds that the claims on this fund since 1957, when the number of claims stood at 52,262, have risen in two years to 94,471—and that is the latest available figure that we have. That is an increase of something like 42,000 claims on the fund. And that shows a loss of some 7,240,000 working days suffered by industry and commerce. When one sees those figures one realizes it is time to become concerned about what is happening to this fund. It no longer shows the graphic rise necessary to meet its increased obligations, it now shows a declining graph on the basis of the present contributions. The hon. the Deputy Minister may remember my words of warning in this respect in 1957, words which I am going to repeat to-day. There has now been a departure from the principle which was in force throughout the years, to the effect that any contributions to the fund, or benefits payable should be determined on an actuarial basis. We have now gone over to the basis of trying to meet the situation by agreement at a board which is not concerned with the actuarial results at all. The fund may be placed in the position, as a result of this, that in a time of general unemployment or economic crisis it may not be able to meet its obligations. I warned the hon. the Deputy Minister in 1957 that on a compromise basis, where fixed contributions are fixed by agreement rather than on the basis of actuarial valuations, there exists no sound financial basis for the level of incoming and benefit payments. And in the long run this will have only one effect, namely, a decrease in the capital level of the fund and consequent dissatisfaction on the part of the workers of South Africa.

If ever words of prophecy were uttered, they were uttered then. That was the attitude adopted by this side of the House. In the light of the fact that the Minister has produced a Bill of this nature to save the fund, to keep it at a static level, to penalize workers to that extent, is absolute proof of the right attitude and right point of view adopted by this side of the House at that time. The Minister in fact has admitted it when he said he would probably have to come in 1963 with a measure to increase the rates of contributions payable by workers and employers in future. If the Minister does come with that measure I want to make this plea to him tonight: Allow these contributions to be fixed on a sliding scale basis as they were fixed before, on a £ for £ or penny for penny basis, and do not fix them on the basis where a separate agreement is arrived at with one group who are interested and another agreement with another group. Let the old principle which worked satisfactorily where the fund took care of the needs of the workers of the day, apply as it did apply successfully in the past. I am sure that if those steps had not been taken in 1957 we would not have been faced to-day with a shortfall of some millions in the fund, which in plain words, Mr. Speaker, is a loss of security for the workers of South Africa.

I want to come to one other matter. The other aspects of the Bill have been adequately dealt with by my hon. friend, the member for Yeoville (Mr. S. J. M. Steyn). There is one particular matter in respect of which I do want to make a plea to the hon. the Minister. The hon. the Minister himself has a fatherly interest in the matter. The Minister possibly has more than a fatherly interest in this matter.

Mr. S. J. M. STEYN:

He is not interested in prospective brothers.

Mr. DURRANT:

Well, that is what I am coming to. I want to ask the Minister whether he will not consider dropping this provision in the Bill which affects the maternity grants. I will tell the Minister why I am asking him to do that. Originally when this benefit was granted to working mothers, it was on the basis that if a woman had not worked for 52 weeks but had been a contributor to the fund over a period of five to six years, she could still claim that benefit even though the date of birth of the child may be some nine months after the date on which she originally made her application. In other words, a period of 12 months could have elapsed in which the woman had not worked but she could still have lodged her application. But the Act was amended in 1961 and we conceded the arguments which were then presented by the Minister, because we did not think that it would affect in any way detrimentally the over-all position, the position that she would have had to have worked for 13 weeks in the 52 weeks preceding the date of her application. What has transpired since this benefit was first granted in 1954? Let me tell the House. At the expense of some R12,000,000 of workers’ money, not Government money, South Africa has been enriched by more than 107,000 new citizens.

Mr. S. J. M. STEYN:

Little ones?

Mr. DURRANT:

Some of them have grown big. You see, Mr. Speaker, the Minister of Labour is not only Minister of Labour but he is also Minister of Immigration. The Minister will admit to-night that he could never bring 107,000 immigrants to South Africa at no cost to the Government in such a short period of time—in nine months; one year. If the Minister has any doubts he should look at the report of his own Department because in that report we are told that this year at a cost of R2,467,000 South Africa’s population has been enriched by 22,702 new citizens in a period of 12 months. That is a wonderful effort, Sir.

Mr. S. J. M. STEYN:

By contributors to the fund only?

Mr. DURRANT:

The mere fact that this side of the House of which the Minister was a member, introduced the original motion and introduced amendments to the amending Bill which the then Minister of Labour introduced in 1954, proves the virility of this side of the House in the productive efforts of the women of South Africa, with the result that there have been more than 107,000 babies. In fact, Mr. Speaker, I go further and say this: That we on this side of the House, by the Government’s acceptance of our proposals, have fathered more than 22,702 babies in the past 12 months. We have maintained a consistent record in this regard over the past four years.

Mr. Speaker, this issue goes further than the Unemployment Insurance Fund. It hits at the very vital interests of South Africa. The Minister, as Minister of Immigration, will admit that he could never bring 107,000 new citizens into this country in a period of six years at no cost to the Government. The benefits that have been paid in this regard have not been paid at the expense of the Government. This fund belongs to the workers. This is a communal effort on the part of the workers who have paid their money into the Unemployment Insurance Fund and the women of this country at least expect to get something back of what they have paid into that fund because that is an essential reward to the women who are doing their duty towards their country. It is a small reward. I make a strong appeal to the hon. the Minister that he will consider dropping this particular aspect from the Bill. The effect of the Minister’s amendment is going to be this: A young girl can work for four or five years, then get married and cease to work. We do not want our women to work. We want them in our homes to build a solid nation, because a nation is built in the home, it is not built in the office, it is not built on the streets. If we have to reach the economic position where we have to send our young mothers out to work in order that the White people may maintain their standard of living, then we are not building a nation, we are building the end of our nation. That is the plea which I want to make to the Minister that he drops this from the Bill. By doing that we will be assisting young married couples to build a home. If a young girl has worked for R80 per month for three or four years, gets married in January and finds in March that she is going to help build a South African nation she can lodge her application there and then for this maternity benefit and she gets back at least a portion of what she has paid into that fund over the years that she did work. It is a short-sighted policy for the relatively small cost because the saving that the Minister will effect under this Bill will not be a very big saving. When you think of the other advantages that can be gained by leaving the position as it is for the welfare and the benefit of our nation, then I plead with the hon. the Minister not to consider proceeding with this aspect of the Bill.

*Mr. G. L. H. VAN NIEKERK:

Last year The Select Committee on Public Accounts asked that the particular attention of Parliament should be given to the deteriorating condition of the Unemployment Insurance Fund. The hon. the Minister gave his attention to this matter with the measures which we have here before us are the result of that attention. Any responsible person had to take note of that request which came from the Select Committee on Public Accounts. The hon. the Minister of Labour did, and decided to take positive action. The hon. the Minister had two ways open to him. The first was to increase the contributions of contributors. The second was to eliminate abuses as far as possible. He then followed this last way. We wish to express the hope that the elimination of malpractices will lead to the fact that it will not be necessary for the hon. the Minister to increase contributions in the future.

Mr. RAW:

What about the genuine cases?

*Mr. G. L. H. VAN NIEKERK:

I am making my own speech. I do not interrupt the hon. member for Durban (Point) (Mr. Raw) when he makes a speech.

I was amazed this evening, Mr. Speaker, that the United Party expressed concern about the position of the Unemployment Insurance Fund, in the person of the hon. member for Turffontein (Mr. Durrant). He expressed concern about the state of the fund while it was he himself who in the past wanted to give the fund away for a national pension scheme in the first place. Last year the hon. member for Turffontein came to light with an even more stupid idea when he stood up in this House and suggested that we should utilize this fund for a “honeymoon” fund. Indeed he asked that we should convert it partly into a marriage fund! I do not know whether he still remembers that. This evening he and his colleagues are suddenly concerned and worried about the position of the fund—the fund, as they put it, which cannot fulfil its obligations. What does amaze one is their concern about the state of the fund but what amazes me even more is that now that the Government is taking these measures to prevent exploitation of the fund, they do not support the Government in this matter. Let me put it that those who oppose these measures are no friends of the workers. They are not acting in the best interests of the workers of South Africa. They are doing no service to the workers.

*Mr. E. G. MALAN:

You say then that the workers are the exploiters of the fund.

*Mr. G. L. H. VAN NIEKERK:

On the contrary, they are doing the workers of South Africa the greatest disservice.

When we are called upon to make decisions and to take resolutions in connection with this fund then there are certain things in this connection in regard to which we must have full clarity and must not lose sight of. In the first place: The Unemployment Insurance Fund is the fund of the bona fide workers of South Africa. The fund belongs to those who are contributors to the fund. Secondly: The Unemployment Insurance Fund is no state fund and no government fund. The State or Government cannot distribute this fund right and left as it pleased. Let me add, Mr. Speaker, that the workers of South Africa who are contributors to this fund have given this fund in trust to the state and the government of the day must administer it and ensure that this fund is used exclusively for the purpose for which it was brought into being, namely, for the primary purpose for which it was established. This brings me to the third consideration. Thirdly: This fund must be utilized to enable those people amongst the contributors who become unemployed through force of circumstances, to pay for their basic requirements of life and those of their dependants during the period of their unemployment. In other words, the Unemployment Insurance Fund is a fund to enable bona fide workers who were contributors and who are still bona fide employment-seekers to bring together two impossible extremities, the extremities of income and expenditure; when income has ceased upon loss of employment but expenditure continues as always because the basic requirements continue to exist. In other words, the Unemployment Insurance Fund is intended to assist bona fide workers who are bona fide employment-seekers—I say this with emphasis, who are bona fide employment-seekers—over a crisis which is a living crisis. The trustee must therefore not permit this fund to be wasted. He must protect it against exploitation, against abuse and against malpractices.

On further analysis it appears that this is precisely what these measures which we have here before us envisage doing. These measures are not aimed at honest workers or honest employment-seekers. They are chiefly aimed at those who are more interested in benefits than in employment. With these measures the hon. the Minister seeks to present its being more beneficial for a man to be unemployed than to work. That is very clear.

*Mr. S. J. M. STEYN:

Do you think so little of the workers?

*Mr. G. L. H. VAN NIEKERK:

I am speaking now about the exploiters. Has the hon. member for Yeoville (Mr. S. J. M. Steyn) not been listening? I said it was aimed at those who are more interested in benefits than in employment. Therefore, Sir, I want to repeat: With these measures the hon. the Minister wishes to prevent it being more beneficial for exploiters to be unemployed than to work. These measures were analysed here to-day by the hon. the Minister himself and by the hon. member for Pretoria (West) (Mr. van der Walt) and their analyses support what I have just said. I am not going to deal with these measures one by one. That we can do at the Committee Stage. I simply say that the Government is engaged in protecting this fund against exploitation. It is clear, Mr. Speaker, that as trustee, the Government is not going to permit this fund to be drained or emptied through the utilization thereof for purposes other than those for which it was brought into being, even though those aims may be as deserving as possible and even though they be as praiseworthy as possible. Other funds must be found for those things. Think, for example, of maternity benefits. Think of sick benefits; other funds have to be created in order to comply with the requirements which exist in this regard. I say that it is clear that the Government cannot allow this fund to be bled dry for purposes other than those for which it was originally established. The measures which we have before us prove this. In effect, these measures tell us: This Unemployment Insurance Fund is not a charitable fund; this fund is not a welfare fund; this fund is not an additional old-age pension fund; this fund is not a sick fund except in so far as temporary illness may create temporary unemployment; this fund is not a maternity fund either except in so far as pregnancy creates unemployment on the part of bona fide working mothers. And when I speak about bona fide working mothers, I am not speaking either about the exploiters in this case; I am not speaking about those women who, once they discover that they are pregnant, go out to work merely with a view to obtaining these benefits and not because they are really honest employment-seekers. I am not speaking about them. I want to go further, Sir, and I want to say that this fund is no idlers’ or topers’ fund; this fund is not a “hobo” fund. This fund is not a “honeymoon” fund either, for the information of the hon. member for Turffontein. This fund is a fund of the workers of South Africa who have built it up during the years of plenty for the lean years which may come. These measures tell us all this very clearly.

*Mr. E. G. MALAN:

Are these lean years?

*Mr. G. L. H. VAN NIEKERK:

They are lean years for the United Party but since 1948 those of us sitting on this side have always enjoyed years of plenty. The Saps are becoming so few, Sir, we are already moving deeper and further into their benches. I do not think that they should speak about lean years.

*Mr. GREYLING:

We are “overflowing” and they “flow out”.

*Mr. G. L. H. VAN NIEKERK:

I say that this Fund is a fund of the workers of South Africa which they have built up in the years of plenty for the lean years which may lie ahead. As trustee, the Government must build up this Fund into a mighty fund so that if abnormal times are forthcoming which create large-scale unemployment, the workers of South Africa will not fall unsaved or die of hunger and misery. Therefore, the Government will continue to keep a watchful eye on everything which threatens to drain this Fund unnecessarily and to rob it unnecessarily.

Unnecessary unemployment will also be guarded against. Unemployment must where possible not be combated by the utilisation of the Unemployment Insurance Fund in the first place but by the creation of opportunities for employment for the workers of South Africa. The Government also accepts this as its very first duty and very first task because its ideal remains: Full employment.

*Mr. E. G. MALAN:

But it does not succeed.

*Mr. G. L. H. VAN NIEKERK:

I will come to why the Government has not succeeded in this regard to the extent to which we would have like it to have succeeded although we do actually have full employment in South Africa to-day.

*Mr. S. J. M. STEYN:

And the fund is becoming bankrupt!

*Mr. G. L. H. VAN NIEKERK:

The Fund is not becoming bankrupt. We are again taking timeous meausres here to prevent the Fund becoming bankrupt. If we had listened to the United Party the Fund would have become bankrupt. If we had listened to the hon. member for Turffontein the Fund would have been bankrupt long ago. It is a bankrupt party which is speaking there. I want to proceed, Mr. Speaker, and say that nothing is calculated to drain this Fund at such a swift pace as continued and large-scale unemployment. However, if unemployment is the result of economic and political factors over which the Government has no control …

*Mr. E. G. MALAN:

What political factors?

*Mr. G. L. H. VAN NIEKERK:

… this untilization and draining of the Fund is unavoidable and justified—a case of needs must when the devil drives. [Interjections.] Mr. Speaker, I cannot even hear myself think because of the conversation which is in progress on both sides.

*Mr. SPEAKER:

Order!

*Mr. G. L. H. VAN NIEKERK:

Where unemployment is, however, the result of the neglect or the inability of the Government or of the unwillingness of the Opposition to co-operate to keep the economic activities of our country at the highest level, that unemployment is unnecessary and it places an unnecessary burden upon the Unemployment Insurance Fund. Mr. Speaker, in this sense there is unnecessary, not necessary unemployment in South Africa to-day. I am not referring now to “won’t works” or the vultures who prey on the Unemployment Insurance Fund. I am referring to the fact that we do not obtain all the capital from abroad which we can obtain for our industrial development and for the erection of our factories which will provide work for all who wish to work. These are unpleasant facts but I must lay them where they belong—at the door of the Opposition and its Press which are the cause of this with their evil-smelling tales which they broadcast to the world. This has resulted in South Africa being called the skunk of the world—these evil-smelling tales about Government policy!

*Mr. SPEAKER:

Order! The hon. member should use more savoury language.

*Mr. G. L. H. VAN NIEKERK:

Yes, Mr. Speaker, but we have to deal with a skunk here …

*Mr. SPEAKER:

Yes, but who is the skunk to which the hon. member is referring?

*Mr. G. L. H. VAN NIEKERK:

I am referring to South Africa which according to the Burger has been called the skunk of the world. Now I say that the irresponsible statements of the Opposition have given us that reputation and it is those irresponsible statements of the Opposition which have given South Africa that reputation and which continually frighten away foreign capital and in this way contribute unnecessarily towards unemployment. It does not help for the Opposition to come along here with pious words and requests that we should combat unemployment by opportunities for work while they contribute towards destroying potential opportunities for employment at source. In the name of the workers of South Africa I want to make this plea to the Opposition this evening: Stop these irresponsible talks, stop them for the sake of the workers of South Africa. Let them rather remain quiet and rather say nothing and leave it to the Government to bring the economic activities of South Africa to the highest possible level in order in this way to ensure full employment and to restrict the unnecessary draining of the Unemployment Insurance Fund by unnecessary unemployment.

As far as the Government is concerned, it will do its duty as trustee of the Fund, undaunted and very definitely.

It will protect the Fund against abuse and malpractices, against unnecessary exhaustion. It will not sit quietly and summarily allow the fund of the workers of South Africa to be robbed by vultures. It would be criminal neglect of duty on the part of the Government if it were to tolerate this. We trust that these timeous steps of the hon. the Minister will have the effect of halting the deteriorating financial position of the Fund. As I have already said, we trust that it will never be necessary to increase the contributions of the workers. I want to ask the hon. the Minister in any case to consider compelling employers to make higher contributions for the higher groups. As you know, they are to-day paying 8 cents per week per capita as their contribution to the Fund in the higher groups. I want to ask that the hon. the Minister should reconsider the matter and consider raising the contributions of the employers in order to bring these into conformity with those of the employees.

In conclusion I want to ask him to invest the money of the Fund as advantageously as possible so that money can earn the highest possible interest.

*Mr. S. J. M. STEYN:

It is too late.

*Mr. G. L. H. VAN NIEKERK:

It is not too late. How can it be too late? We know that the Fund still has more than £60,000,000 or R120,000,000 available and it is never too late for the National Party to do something in the interests of the workers. We will always, as in the past, step into the breach for the workers of South Africa, as we are going here again through the medium of these measures.

Mr. OLDFIELD:

The hon. member for Boksburg (Mr. G. L. H. van Niekerk) to-night has made a plea on behalf of the workers of South Africa, but it is surprising that in looking towards the welfare of the workers of South Africa, he did not apply the practical implications that are involved in the introduction of this Bill. Because if he had looked at the Bill factually, he would have found that the provisions of this Bill adversely affect the workers of South Africa, and deprive them of certain rights they previously enjoyed under the principal Act of 1946. He was rather inclined to adopt the usual tactics employed by that side of the House of looking for a scapegoat, and of course that scapegoat was once again the English Press and the Opposition. Now, Mr. Speaker, the whole question here, looking at the interests of the workers, is to find what advantages they can gain as a result of the introduction of this Bill, and there we find a great deal of difficulty because in the past this Act has been amended over and over again. If you look at the principal Act and the amending Acts, you find it was amended in 1949, 1952, 1954, 1957, 1959, 1960 and 1961, and we were told last year when a Bill was introduced that it would be an attempt to stop certain abuses. Therefore we would like to know from the hon. the Minister whether he considers that amending Act of 1961 has failed in its object to stop certain abuses. Because as we see the position on this side of the House, the Select Committee on Public Accounts which submitted its report, showed that at an unemployment figure of 2 per cent this fund would continue to deteriorate. So with the normal unemployment figure (and we are told that it is a normal employment time now) the fund is deteriorating. Mr. Speaker, what will happen if there is an increase in unemployment? If the fund in what are normal employment times is now going into the red, what will happen in abnormal times? If these are normal times, one fears for the future of this fund. Sir, looking after the interests of the workers and looking after the interests in such a way that they are not deprived of certain rights, I believe it to be the duty of members of this House who represent in their own constituencies perhaps many thousands of contributors to this fund, to voice their objection here to-night in the course of this debate, because it has been outlined by the hon. member for Yeoville (Mr. S. J. M. Steyn) that certain rights have been taken away from the workers and from the contributors to this fund. We have supported in the past any measures that had been taken to prevent abuse of this fund. In Clause 1 of the Bill before us to-night, the Minister is taking a further step whereby a contributor who is penalized will have to register at the labour office and will have to continue to register during the period that he is penalized. Such a step is a step in the direction of stopping abuse. But the whole principle in this Bill is to curb expenditure and the steps that are being taken here to curb expenditure are impinging upon the rights of the workers that they previously enjoyed. When you look at the Department of Labour’s report for 1960, you will find that the main benefits, the main unemployment benefits amounted to £3,670,500—sickness allowances £1,445,500, maternity benefits of £1,233,500 and dependants’ allowances of £334,500. The three major benefits are now to have certain steps taken against them by the provisions of this Bill in an attempt to curb that expenditure, and the steps that are being taken are indeed severe steps, and so far we have failed to hear any justification from that side of the House for these steps. For instance in the report that I have just quoted, the question is mentioned of illness-allowances and maternity benefits, and it states that the increase in the number of persons who received illness-allowances and maternity benefits was not unduly large if the substantial increase in the number of contributors to the fund was borne in mind. So these increases that are outlined in this report show that they are not unduly large. Therefore we want to know where these abuses are taking place. If it is a normal increase in the amounts that have been paid out under these certain benefits, to what extent are abuses taking place? It seems wrong and unjust that the genuine and bona fide contributor and the genuinely unemployed person should be subject to these severe provisions, because if the percentage is a small percentage—possibly there are a certain number of persons, and to my knowledge it must be a very small number indeed, who abuse certain provisions of this fund, the genuine cases should not be made to suffer as a result. We on this side of the House have never condoned an habitual won’t-work, we have never condoned a man who is merely interested in receiving his 26 weeks’ benefits. When the hon. the Minister started his speech this afternoon, he mentioned the fact that we supported certain provisions of that Bill that was introduced last year, and that Clause 1 of this Bill goes a step further in regard to abuses and as far as people who are penalized are concerned.

Mr. DURRANT:

The claims officers have tremendous powers.

Mr. OLDFIELD:

Quite so. I know of a case in the constituency that I represent where a person felt that he had been unjustifiably penalized for a period of six weeks by the claims officer. It took him over four months before finality was reached. He appealed to the Benefits Committee, he took an appeal to the Unemployment Insurance Board, and his appeal was rejected, but it took a period of four months before he knew his financial fate, and during that period of time his furniture was repossessed, his family suffered severe hardships, his bond on his home was foreclosed. These people suffered severe hardships as the result of the arbitrary power that the claims officer has.

An HON. MEMBER:

[Inaudible.]

Mr. OLDFIELD:

It is all very well for the member over there to try and brush aside these matters, but if he goes and talks to those who are unemployed, standing in the unemployed queue, he will get a better idea from the inside as to what problems are facing these people, the sufferings of their families. The provisions of this Bill go very far indeed and the three main amendments which amend Section 38 of the principal Act (the application for benefits) Section 39 (the scales of benefits) and Section 40 (the conditions relating to payments of benefits) are all matters which vitally affect the contributor, these are matters in respect of which he has felt secure in the past in the knowledge that if he should become unemployed, he is covered by certain provisions. These provisions are now to be altered, and in judging the merits of this Bill, I think those persons who have the interests of the workers at heart should judge this Bill on its practical application and what it will mean in terms of the worker. What the practical application will be is the yardstick by which we should judge the merits of this Bill. Taking that as your yardstick, we find that these certain provisions, firstly the provision in Clause 2 of the Bill, are provisions which are going to affect also the future contributors to the fund—but what is it going to mean in the practical application? It is going to mean that where the period of benefits that is credited to the contributor was one week for every four weeks that he has contributed, it is now going to be one-week benefits for every six weeks that he has contributed to the fund. It means that to qualify for the full 26 weeks benefits, he will have to work a period of two years at present, but under the new provisions in sub-section (b), he will have to contribute for a period of three years before qualifying for the full 26 weeks benefits. That means a period of a whole year more. The new contributor will be put to the disadvantage of paying the same contribution to the fund, but receiving far less in regard to their benefits. So if a person commences work and then contributes to that fund for a period of two years, or 112 weeks, that person in future will only receive benefits for 18 weeks, whereas the person previously under the system of one week for four weeks received the full 26 weeks. So that is a disadvantage of two months which the new contributor is faced with. Therefore it is clear from these new provisions that a person who is paying the same insurance cover (this claims to be an insurance measure) receive nowhere near the same cover that other persons have been enjoying.

In further applying the yardstick of the practical application of this Bill in regard to the workers, we come to the clause that deals with illness-allowances. In terms of the provision that we have here, what is the position? We have heard from the other side that these provisions are necessary, because this is not a measure to provide for illness. But in the past it has been used for that particular purpose. During the introduction of this Bill, the hon. the Minister of Labour stated that he did not consider these allowances as falling within the scope of unemployment insurance and that the responsibility must rest elsewhere. So what is the position now when a man, perhaps at the age of 40 or 45, suffering illness, qualifying for the benefits, at the end of the period of benefits goes to claim benefit for another period when he remains unemployed? During that period of remaining unemployed he is not in the position to make the necessary contributions for another 13 weeks to that fund. Then he is not entitled to re-apply for any further benefits. The Minister stated that he becomes the responsibility of someone else. Where does that other responsibility lie? As I can see it the only avenue open to him is the Department of Social Welfare where he can apply for a disability grant. But what is the position if he applies for a disability grant? He is subject to the invidious means test, the same means test that applies in respect of old-age pensions. So you can see what the hon. the Minister is subjecting that person to. And if he does not qualify in terms of the means test for a disability grant, he then becomes the responsibility of charity. Why should a man who has contributed to a fund to secure the necessary cover for unemployment, then be subjected to have to live on charity? He has contributed to the fund and felt secure in the knowledge that he would have some form of benefits accruing to him, but he then finds that after contributing for many years, he is not entitled to any further benefit from that fund. Then he is dependent on charity. I think that is a scandalous situation, and this Bill brings about a situation of that kind. That is why I think it is not right for the hon. the Minister to try and shelve this whole question of the illness-allowances without realizing the severe effect of making provision here that he must come to you for a further period of 13 weeks before qualifying for any further benefits.

As I mentioned earlier, in the Department of Labour’s Report it is stated that there was no undue increase in the number of payments made under illness-allowances.

The other question that arises has already been dealt with by the hon. member for Turffontein (Mr. Durrant), who covered the position in regard to maternity benefits. Even under the existing law a certain degree of dissatisfaction exists. I wish to quote a particular case here. And may I say that when referring to these particular cases, one gets a good insight into the practical application of any law that is passed by this House. Here you have a person who had been employed for a period of ten years. She had contributed to the fund for a period of ten years and was married. She then found that she was unable to continue in her employment because she was called upon to look after the two children of the husband’s previous marriage. Under those circumstances she looked after those children for the period of a year, and just after that period of a year she wished to apply for benefits under the maternity allowances provision in the Act. However, her application was rejected because she had not contributed for a period of 13 weeks prior to her application. Now that period is going to be further extended to a period of 18 weeks. So you can see that there will even be more cases that will fall outside the provisions of this Act, cases where persons have contributed for a period of over ten years, receiving nothing in the form of benefits.

The other important factor in regard to this Bill is in connection with the new provisions under (1) and (m), which amend Section 40 of the principal Act. The hon. member for Yeoville mentioned this point and I want to take it a little bit further in regard to its practical application to see what the provision will be if this Bill becomes law. The provision here is that a person cannot re-apply if he has not contributed for a period of 13 weeks immediately prior to a period of unemployment, a period of 13 weeks during a period of 52 weeks immediately prior to the term deemed to be a period of unemployment. In regard to this provision, we come to the position of the older worker who endeavours to find employment, who is sometimes retrenched and replaced, and then sometimes at the age of 40 or 45, with family responsibilities, finds it exceedingly difficult to obtain suitable employment. Consequently there is. and there always has been for a long period of time, ever since the economy of this country slowed up, a large number of these people who have become quite desperate in regard to finding some means of supporting their families and their dependants. Now with all good intentions in the world, the contributor who has perhaps worked for a long period of time, draws his full 26 weeks benefits, and then during the following period is unable to find any type of employment whatsoever; in terms of the provision that is before the House to-night, that person must be employed for another period of 13 weeks, during the 52 weeks prior to another period of unemployment. Consequently he must find some form of employment before he can draw any further benefits. This is going to be another severe hardship to the man who is genuinely unemployed. It is all very well for members to talk about the won’t-works and those who abuse the Act, but we have got to take into account that the practical application of this Bill is seriously going to affect the genuine person who cannot find employment. He is unable to find employment, and because he is unable to find employment, the fund that he has contributed to is unable to assist him if this amending Bill should be passed.

The other point is in regard to still older people. The hon. the Minister in introducing this Bill spoke about the old-age pensioner, the older person. There are several cases that I have knowledge of where a great deal of hardship has been caused by the present system, whereby a person has been drawing benefits for six months from the Unemployment Benefit Fund and then because in terms of the Act he cannot draw more than 26 weeks benefits, he applies for an old-age pension and he draws an old-age pension for the next six months. But often the period of time between the ceasing of the unemployment benefit and the granting of an old-age pension can be up to two and three months, and during that period of time those people suffer severe hardships. Then it is adjusted again as the law is to-day, when they go back after drawing the old-age pension for six months, to six months drawing of the unemployment benefit. As I understand the provisions of this Bill, and I hope the hon. the Minister will be able to confirm this, or otherwise, these elderly folk who perhaps are over 65 years of age who have drawn benefits for 26 weeks and who naturally because of their advanced age, cannot find work, will then cease to become the responsibility of the Unemployment Benefit Fund after drawing their 26 weeks benefits. If that is so, then the additional burden will fall on the Department of Social Welfare and Pensions, because they will then commence drawing their old-age pension immediately the 26 weeks benefit has been drawn under the Unemployment Insurance Act. That being so, I would like to know from the hon. the Minister whether this particular provision has got the approval of the Minister of Pensions, because it is going to increase the amount of money paid out in pensions, because instead of them being able to draw in respect of the contributions they have been credited with over the years, after each period of 26 weeks, these people now will only draw for one initial period of 26 weeks, and thereafter for the rest of their lives they will continue drawing benefits as old-age pensioners, or they will draw other social benefits. They will then become the responsibility of the Minister of Pensions. I was hoping to raise this matter at a later stage with the hon. the Minister of Labour, because, as I mentioned earlier, having to go from one fund to the other has caused some degree of hardship. But there are some people, and here is one particular case I have been asked to raise, who would like to continue to draw their benefits from the Unemployment Insurance Fund. They think they are entitled to those benefits in view of the amount of credit standing in their name, before they go onto the old-age pension. Because there is quite a difference between the benefits that they enjoy from the Unemployment Fund and the benefits they receive as old-age pensioners. Therefore they would like to know whether it is not possible for them to be able to draw the full amount that is standing to their credit in that fund, because they had been contributors for many years, and they believe that they are entitled to that consideration.

So in summing up the whole position in regard to this Bill. I support the amendment that has been moved by the hon. member for Yeoville, because in judging the application of this Bill as we see it, it adversely affects the workers, and it is surprising that people on the other side who generally say that they are looking after the interests of the workers, have not applied the practical application of this Bill to see how it affects them and how adversely it can affect the genuine person who is a contributor to the fund and is entitled to those benefits. This Bill deprives that person of certain rights we feel most strongly about, and we believe the Bill should not be proceeded with.

*Mr. VAN RENSBURG:

The hon. member who has just sat down says that the workers will judge these amendments on their merits. But if there is one thing of which I am very convinced this evening it is that the workers will judge the United Party on its merits, particularly as regards the United Party’s pathetic action in respect of this matter of unemployment insurance. In 1959 the United Party’s attitude was that the Unemployment Insurance Fund was a fund for the unemployed which had to be used to assist them in difficult times when they became unemployed. This evening and this afternoon the United Party refused to give its support to the elimination of abuses and to steps which are designed to protect the fund for this very purpose for the workers of our country. The United Party is the last party that can come along and object, as they have done to-day through the hon. member for Yeoville (Mr. S. J. M. Steyn), to the withdrawal of short-time benefits. They have a very short memory. They are the very people who opposed the granting of those short-time benefits in 1959 when this matter was before the House. At that time they moved an amendment in this regard and the hon. member for Umhlatuzana (Mr. Eaton) who moved the amendment, had the following to say, inter alia

We cannot permit a state of affairs to be brought about by an amendment of this nature whereby all the workers who are working to-day and who may become unemployed in the future will have to discover in the course of time that their fund is becoming smaller and smaller because of schemes which are applied to combat unemployment itself.

The hon. member for Yeoville must listen how he has changed his opinions since 1959. The hon. member for Umhlutazana went on to say—

In other words, the fund can now be used not for unemployment purposes but to subsidize employers in order to prevent unemployment. This is a new principle entirely. It is a risky principle.

And the United Party voted as one man against the giving of short-time benefits in 1959. This evening they pose as the advocates of short-time benefits.

*Mr. S. J. M. STEYN:

Did you support us then?

*Mr. VAN RENSBURG:

The hon. member for Yeoville comes along and says that we have been acting too royally with the fund by granting benefits left and right. In 1959 the hon. member for Umhlatuzana stated as follows in this House—

Over a period of nine years a great change has already come about in the finances of the fund. We do not object to this because we know that the largest portion of it has been taken up by improved benefits to the workers.
*Mr. DURRANT:

What is wrong with that?

*Mr. VAN RENSBURG:

Yes, but this evening the hon. member for Yeoville accuses us of having acted too royally with the funds of the workers. Hon. members on the other side talk about things which are morally indefensible but they are the last people who can say such things. The hon. member for Yeoville is certainly the last person who can speak about such things. I have here a pamphlet which was issued during a very important election by the United Party entitled: “The Workers’ Charter: The United Party’s Guarantees to the workers of South Africa.” If we revise this pamphlet we find that the United Party said—

The objection of the Nationalists that under this pension scheme the £50,000,000 in the Unemployment Fund is inadequate to protect the workers against unemployment, is nonsense.

Does the hon. member agree with what is stated here?

*Mr. S. J. M. STEYN:

We did not reduce the contributions.

*Mr. VAN RENSBURG:

No, I am putting a direct question as to whether he agrees with what is said here.

*Mr. S. J. M. STEYN:

On the contributions which were payable at the time, no.

*Mr. VAN RENSBURG:

Do you know what the hon. member for Yeoville wrote in Weekblad on 29 May 1959? At that time he wrote—

The funds to insure people against unemployment are not inexhaustible.

And at that time the amount in the fund stood far higher than the amount of £50,000,000 at which it stood in 1952. However, this pamphlet goes on to say—

A capital investment of £50,000,000 is sufficient for all claims which may be made against the Unemployment Fund, even though the unemployment figure reached 80 per cent in any particular year.

In all probability it was he who drafted it because he was the propagandist of the United Party.

At 10.25 p.m. the business under consideration was interrupted by Mr. Speaker in accordance with Standing Order No. 26 (1), and the debate was adjourned until 23 March.

The House adjourned at 10.26 p.m.